16th Mar 2010 07:00
Air Partner PLC
("Air Partner" or "the Group" or "the Company")
Results for the six months ended 31 January 2010
Air Partner is a leading provider of private aviation services to industry, commerce, governments and private individuals worldwide.
Highlights:
|
* Commercial Jet Broking Division: overcapacity and discounting continues - working with political party for UK general election campaign
|
|
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* Private Jet Broking Division: broking & JetCard have held up relatively well |
|
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* Freight Broking Division: significantly increasing market share |
|
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* Private Jet Operating Company ("PJOC"): placed into administration: - decisive action stops losses, alternative exit options exhausted - change in aviation environment removed need to secure capacity via PJOC - core private jet broking and JetCard products not affected by closure
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|
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* Active management of office network for efficiencies and future growth |
|
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* Current trading remains challenging, some tentative signs of Q4 improvement |
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Continuing operations (core commercial and private jet broking): |
|
|
* Group Sales |
Down 7% to £95.0m (2009: £101.8m) |
|
* Group PBT |
Down 77% to £1.0m (2009: £4.3m) |
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* Group diluted EPS |
Down 64% to 11.7p (2009: 32.3p) |
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Including discontinued operations (including private jet operating company): |
|
|
* PAT |
Down 148% to (£1.2m) (2009: £2.5m) |
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* Diluted EPS |
Down 147% to (11.6p) (2009: 24.5p) |
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* Cash |
Down 34% to £14.7m (2009: £22.1m) |
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* Exceptional items and impairments: £2.4m from costs associated with PJOC |
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* Board not declaring dividend payment until year end due to losses and current trading |
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16th March 2010
Aubrey Adams, Chairman of Air Partner commented: "The Board has taken decisive action to reduce overheads and ensure that the Group is well positioned to return to growth as the market starts to improve. The decision to suspend the half year dividend until the year-end, when we intend to make a payment to shareholders, reflects the extraordinary conditions in the aviation market. The steps announced today will enable the Group to focus on its core broking business, offering excellent charter and jet card services to governments, corporates and high net worth clients."
Enquiries:
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Air Partner plc |
T. 01293 844 788 |
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Mark Briffa CEO Designate (on March 16th 2010) |
T. 0207 002 1080 |
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Temple Bar Advisory |
T. 0207 002 1080 |
|
Tom Allison |
T. 0778 999 8020 |
|
Nicola Flynn |
|
Air Partner PLC
("Air Partner" or "the Group" or "the Company")
Results for the six months ended 31 January 2010
Chairman's Statement
The six months to 31 January 2010 have been characterised by tough trading conditions both at Air Partner and within the wider aviation sector. This economic backdrop particularly impacted the Private Jet Operating Company at Biggin Hill ("PJOC" or "the Subsidiary"), which reported losses and negatively affected the larger Group. Accordingly, the Board has decided to close the PJOC, and the
Subsidiary has been placed with administrators. While it is extremely disappointing to be disposing of the PJOC via an administration, the Board has exhausted all alternative options to further reduce costs and protect shareholder value in the core broking business.
In the period under review, continuing Group sales fell by 7% to £95.0m (2009: £101.8m). The Group's continuing activities made a profit before tax of £1.0m, but the exceptional charges of £2.4m associated with the PJOC, contributed to an overall loss after tax to £1.2m (2009: £2.5m profit), and core diluted earnings per share were down 64% to 11.7p (2009: 32.2p). The Group cash balance has reduced to £14.7m (2009: £22.1m). It is worth stressing that Air Partner entered the recession late and reported a very strong first quarter in 2008. Accordingly, while current trading is challenging and the losses at the PJOC draining, the year on year comparisons are particularly stark at this stage in the economic cycle.
Despite last year's significant cost cutting, the PJOC still reported a loss of £1.2m, and a £1.5m impairment of goodwill charge in the period under review. Since 2009, the Board has looked at a number of joint venture and disposal options for the PJOC, but these have failed to conclude. Moreover, the continued decline in the aviation sector has removed the rationale for Air Partner to control a managed fleet of private jets at the PJOC. In the current economic environment, as a pure charter broker, Air Partner will be better placed to access competitive hourly jet rates from its approved list of operators. Consequently, the Board believes the closure of the PJOC will better enable the Group to focus on its core private jet broking business, continuing to offer excellent charter and JetCard services to governments, corporates and high net worth clients.
Given the current economic situation and the ongoing efficiency changes at Air Partner, as the Group continues to transition back to its core broking business and growth, the Board believes it is prudent to conserve cash and not pay a half year dividend. The Board will review the dividend at the year end, once the PJOC closure is complete and working capital requirements have been met for the Group's key government work. However, it should be stressed that Board currently anticipates paying a final dividend to shareholders.
While the current economic downturn has required cost cutting and cash conservation as the Group adjusts to today's reduced trading levels, the core strategy remains firmly in place. We continue to seek diversification of Group revenue by geography, product and client, and while the primary focus for the last six months has been to maximise the potential of our existing offices, the Board has actively managed the Group's international offices to optimise reach, profitability and client requirements. This has seen the closure of the Lyon office, where medium term forecasts were poor, and the successful transfer of the existing business to Paris. Meanwhile, in January the Group identified and executed an opportunity to expand into Turkey and early signs are positive. Elsewhere, a Freight partnership has been agreed in Hong Kong and we are testing opportunities to use this territory as a hub for the surrounding area. The Company's sales presence in Moscow continues and is currently producing good results.
In February, Chief Executive Officer, David Savile, announced he will be resigning with effect from 31 March 2010. We are very grateful for the commitment and leadership David has shown throughout his time at Air Partner and wish him well for the future. We are delighted with the appointment of Mark Briffa as the new Chief Executive Officer. He brings fourteen years of experience at Air Partner and 20 years in the aviation industry.
Commercial Jets
The primary division continues to represent almost 49% of continuing Group activity with total sales of £46.6m. The sector continues to suffer from significant over capacity and heavy discounting. As a result, competition has increased across the commercial jet market and is more aggressive than before, with margins reducing as a result. Suppliers continue to market products directly and clients remain very price focused. Consequently, Air Partner is highly focused on client care and despite the current constraints, we continue to grow our client base. Not surprisingly, the conference and incentive and automotive sectors continue to be badly affected, but we are starting to see signs of recovery albeit very slowly. More positively, government and military business remains buoyant and the Group is actively working with Political Parties to help them carry out their flying needs for the forthcoming general election. We continue to develop our government business on a global basis. Elsewhere, niche areas such as sport, inclusive tours and special interest groups are performing relatively well, and we continue to work with our General Sales Agent ("GSA") partners to provide creative solutions into our niche markets.
Private Jets
Pleasingly, private jet broking and JetCard have held up well. The Board expects fractional schemes and jet ownership to come under pressure, as clients realise the benefits of ad hoc charter and card schemes in these markets. While a high number of users are currently tied into fractional contracts for a set term, we believe clients will migrate to chartering in the near future. Air Partner's JetCard product remains profitable and while sales are slow, existing clients continue to renew. We are expanding our JetCard product into France, Germany, Italy, and Russia, and initial responses have been positive. The downturn in the private jet market has removed the necessity to control capacity, which contributed to the Board's decision to close the PJOC and access competitive hourly jet rates from its approved list of operators. The Board has also entered a GSA agreement with a private jet operator and is marketing their private jets on an exclusive basis in Russia.
Freight
Whilst the global general cargo market is down approximately 10-15%, it is pleasing to report that the Freight division, which accounts for 24% of continuing Group sales, has continued to perform robustly and report good sales along with a growing client base. H1 sales were £22.9m, as the team has continued to win repeat and long-term government business, and enquiry levels are currently at an all time high. We are excited by the prospects presented by the new partnership agreed in Hong Kong and the surrounding area. The market remains competitive and margins have been adversely affected accordingly, but we are pleased with the performance of this division. The Group has invested for further growth, expanding the team in Germany and France.
Air Partner's smaller divisions, Emergency Planning, Flight Operations, SAAB leasing, travel agency and Fuel broking, while not individually significant to the Group's profitability, are all performing in line with expectations, efficiently servicing clients and providing further revenue and client diversification.
Outlook
The Board has taken decisive action to ensure that the Group is well positioned to return to growth, as the market starts to improve. Today the Company is working towards becoming leaner, more flexible and better positioned for current business levels. We continue to transition back to our core broking business and believe our unique skills and international network, combined with product and client diversification provide a strong foundation to weather the remaining downturn and return to growth as the economy improves. The air charter market remains extremely challenging, but we are seeing tentative signs of some recovery in the fourth quarter.
Aubrey Adams
Chairman
16 March 2010
Air Partner PLC
Results for the six months ended 31 January 2010
Condensed consolidated income statement
|
Continuing operations |
Note |
Half year to 31 January 2010 (unaudited) £'000 |
Half year to 31 January 2009 (unaudited) £'000 |
Year to 31 July 2009 (audited) £'000 |
|
Revenue |
2 |
95,006 |
101,822 |
184,929 |
|
Cost of sales |
(85,756) |
(89,807) |
(162,826) |
|
|
Gross profit |
9,250 |
12,015 |
22,103 |
|
|
Administrative expenses |
(8,332) |
(8,089) |
(16,951) |
|
|
Operating profit |
918 |
3,926 |
5,152 |
|
|
Finance income |
95 |
394 |
490 |
|
|
Finance costs |
(7) |
- |
- |
|
|
Profit before tax |
1,006 |
4,320 |
5,642 |
|
|
Taxation |
7 |
196 |
(1,029) |
(965) |
|
Profit for the period from continuing operations |
1,202 |
3,291 |
4,677 |
|
|
Loss for the period from discontinued operations |
12 |
(2,391) |
(792) |
(4,715) |
|
(Loss) / profit for the period |
(1,189) |
2,499 |
(38) |
|
|
Attributable to: |
||||
|
Equity holders of the parent |
(1,189) |
2,499 |
(38) |
|
|
Earnings per share: |
||||
|
Continuing & discontinued operations |
||||
|
Basic |
4 |
(11.6)p |
24.5p |
(0.4)p |
|
Diluted |
4 |
(11.6)p |
24.5p |
(0.4)p |
|
Continuing operations |
||||
|
Basic |
4 |
11.7p |
32.3p |
45.9p |
|
Diluted |
4 |
11.7p |
32.2p |
45.7p |
Air Partner PLC
Results for the six months ended 31 January 2010
Condensed consolidated statement of comprehensive income
|
Half year to 31 January 2010 (unaudited) £'000 |
Half year to 31 January 2009 (unaudited) £'000 |
Year to 31 July 2009 (audited) £'000 |
|
|
(Loss) / profit for the period |
(1,189) |
2,499 |
(38) |
|
Exchange differences on translation of foreign operations |
261 |
1,189 |
843 |
|
Total comprehensive income for the period |
(928) |
3,688 |
805 |
|
Attributable to: |
|||
|
Equity holders of the parent |
(928) |
3,688 |
805 |
|
(928) |
3,688 |
805 |
|
Air Partner PLC
Results for the six months ended 31 January 2010
Condensed consolidated statement of changes in equity
|
Share capital £'000 |
Share premium account £'000 |
Share option reserve £'000 |
Translation Reserve £'000 |
Retained earnings £'000 |
Total equity £'000 |
|
|
Opening equity as at 1 August 2008 |
509 |
4,264 |
591 |
356 |
11,362 |
17,082 |
|
Profit for the period |
- |
- |
- |
- |
2,499 |
2,499 |
|
Exchange differences on translation of foreign operations |
- |
- |
- |
1,189 |
- |
1,189 |
|
Total comprehensive income for the period |
- |
- |
- |
1,189 |
2,499 |
3,688 |
|
Share option movement for period |
- |
- |
196 |
- |
- |
196 |
|
Issue of shares under share option scheme |
1 |
45 |
(12) |
- |
12 |
46 |
|
Dividends |
- |
- |
- |
- |
(2,306) |
(2,306) |
|
Closing equity as at 31 January 2009 |
510 |
4,309 |
775 |
1,545 |
11,567 |
18,706 |
During October 2008 11,600 new shares were issued following exercise of staff options under the Air Partner plc Company Share Option Plan 2003.
|
Share capital £'000 |
Share premium account £'000 |
Share option reserve £'000 |
Translation reserve £'000 |
Retained earnings £'000 |
Total equity £'000 |
|
|
Opening equity as at 1 August 2009 |
512 |
4,440 |
896 |
1,199 |
8,240 |
15,287 |
|
Loss for the period |
- |
- |
- |
- |
(1,189) |
(1,189) |
|
Exchange differences on translation of foreign operations |
- |
- |
- |
261 |
- |
261 |
|
Total comprehensive income for the period |
- |
- |
- |
261 |
(1,189) |
(928) |
|
Share option movement for period |
- |
- |
82 |
- |
- |
82 |
|
Issue of shares under share option scheme |
1 |
59 |
(16) |
- |
16 |
60 |
|
Dividends |
- |
- |
- |
- |
(2,315) |
(2,315) |
|
Closing equity as at 31 January 2010 |
513 |
4,499 |
962 |
1,460 |
4,752 |
12,186 |
During January 2010 15,000 new shares were issued following exercise of staff options under the Air Partner plc Company Share Option Plan 2003.
Air Partner PLC
Results for the six months ended 31 January 2010
Condensed consolidated balance sheet
|
Note |
Half year to 31 January 2010 (unaudited) £'000 |
Half year to 31 January 2009 (unaudited) £'000 |
Year to 31 July 2009 (audited) £'000 |
|
|
Assets |
||||
|
Non-current assets |
||||
|
Goodwill |
8 |
755 |
4,374 |
2,268 |
|
Other intangible assets |
98 |
116 |
29 |
|
|
Property, plant and equipment |
9 |
2,145 |
1,934 |
2,238 |
|
Deferred tax assets |
524 |
375 |
487 |
|
|
3,522 |
6,799 |
5,022 |
||
|
Current assets |
||||
|
Inventories |
- |
352 |
424 |
|
|
Trade and other receivables |
26,714 |
19,724 |
26,507 |
|
|
Current tax assets |
1,461 |
814 |
359 |
|
|
Cash and cash equivalents |
14,604 |
22,148 |
16,137 |
|
|
42,779 |
43,038 |
43,427 |
||
|
Assets held for sale |
12 |
2,137 |
- |
- |
|
Total assets |
48,438 |
49,837 |
48,449 |
|
|
Liabilities |
||||
|
Current liabilities |
||||
|
Trade and other payables |
(10,388) |
(11,085) |
(10,033) |
|
|
Financial liabilities |
- |
- |
(3) |
|
|
Current tax liabilities |
(1,414) |
(1,227) |
(537) |
|
|
Other liabilities |
(22,942) |
(18,783) |
(22,571) |
|
|
|
(34,744) |
(31,095) |
(33,144) |
|
|
Net current assets |
8,035 |
11,943 |
10,283 |
|
|
Non-current liabilities |
||||
|
Deferred tax liability |
- |
(36) |
(18) |
|
|
|
- |
(36) |
(18) |
|
|
Liabilities held for sale |
12 |
(1,508) |
- |
- |
|
Total liabilities |
(36,252) |
(31,131) |
(33,162) |
|
|
Net assets |
12,186 |
18,706 |
15,287 |
|
|
Share capital |
513 |
510 |
512 |
|
|
Share premium account |
4,499 |
4,309 |
4,440 |
|
|
Translation reserve |
1,460 |
1,545 |
1,199 |
|
|
Share option reserve |
962 |
775 |
896 |
|
|
Retained earnings |
4,752 |
11,567 |
8,240 |
|
|
Equity attributable to equity holders of the parent |
12,186 |
18,706 |
15,287 |
|
|
Total equity |
12,186 |
18,706 |
15,287 |
|
|
Total equity and liabilities |
48,438 |
49,023 |
48,449 |
|
Air Partner PLC
Results for the six months ended 31 January 2010
Condensed consolidated statement of cash flows
|
Note |
Half year to 31 January 2010 (unaudited) £'000 |
Half year to 31 January 2009 (unaudited) £'000 |
Year to 31 July 2009 (audited) £'000 |
|
|
Cash flows from operating activities |
||||
|
Continuing operations |
5 |
3,528 |
3,902 |
1,264 |
|
Discontinued operations |
|
(1,288) |
(1,103) |
(2,630) |
|
Net cash from operating activities |
|
2,240 |
2,799 |
(1,366) |
|
Investing activities |
||||
|
Continuing operations |
||||
|
- Interest received |
95 |
400 |
496 |
|
|
- Purchases of property, plant and equipment |
(1,627) |
(317) |
(1,319) |
|
|
Discontinued operations |
- |
29 |
30 |
|
|
Net cash (used in) / generated by investing activities |
(1,532) |
112 |
(793) |
|
|
Financing activities |
||||
|
Continuing operations |
||||
|
- Dividends paid |
3 |
(2,315) |
(2,306) |
(3,132) |
|
- Proceeds on issue of shares |
60 |
46 |
179 |
|
|
Discontinued operations |
- |
- |
- |
|
|
Net cash used in financing activities |
(2,255) |
(2,260) |
(2,953) |
|
|
Net (decrease) / increase in cash and cash equivalents |
6 |
(1,547) |
651 |
(5,112) |
|
Opening cash and cash equivalents |
16,137 |
20,756 |
20,756 |
|
|
Effect of foreign exchange rate changes |
14 |
741 |
493 |
|
|
Closing cash and cash equivalents |
14,604 |
22,148 |
16,137 |
|
Notes to the condensed consolidated financial statements
1 Interim statement
Basis of preparation
This unaudited condensed interim financial information for the half year ended 31 January 2010 has been prepared in accordance with the Disclosure and Transparency Rules of the Financial Services Authority and IAS 34, 'Interim Financial Reporting' as adopted by the European Union. The interim condensed financial report should be read in conjunction with the annual financial statements for the year ended 31 July 2009.
The financial information contained in this document does not constitute statutory accounts as defined in Section 435 of the Companies Act 2006. The auditors have issued an unqualified opinion on the Group's statutory financial statements under International Financial Reporting Standards as adopted by the European Union for the year ended 31 July 2009, which have been filed with the Registrar of Companies.
The accounting policies adopted are consistent with those of the annual financial statements for the year ended 31 July 2009, as described in the annual financial statements for the year ended 31 July 2009, except as described below:
a) Adoption of new and revised standards
In the current financial year, the Group has adopted IFRS 8 Operating Segments and IAS 1 Presentation of Financial Statements (revised).
IFRS 8 requires operating segments to be identified on the basis of internal management information that is regularly reviewed by the Chief Operating Decision Maker (CODM) to allocate resources to the segments and to assess their performance. In contrast, IFRS 8's predecessor (IAS 14 Segmental Reporting) required the Group to identify two sets of segments (geographical and business) with one being designated as the primary segment (geographical). As a result of the application of IFRS 8, the Group's segmental information has been presented as discussed in note 2 and comparative information has been represented accordingly.
IAS 1 (revised) requires non-owner changes in equity to be presented separately from owner changes in equity within a performance statement. The Group have chosen to present two performance statements, the consolidated income statement and the consolidated statement of comprehensive income. The statement of changes in equity has been included as a primary statement and presents all owner changes in equity and non-owner changes in equity.
b) Key accounting estimates and judgements
The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. These estimates and associated assumptions are based on historical experience and various other factors believed to be reasonable under the circumstances. Actual results could differ from these estimates. These underlying assumptions are reviewed on an on-going basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period; or in the period of the revision and future periods if these are also affected.
The estimates and assumptions that have a significant effect on the amounts recognised are those related to impairment testing as these tests require the recoverable amount of the cash generating unit or asset to be estimated (note 8).
2 Segmental analysis
The Group has adopted IFRS 8 'Operating segments' effective from 1 August 2009. IFRS 8 requires operating segments to be identified on the basis of how internal management reporting presents components of the Group to the 'Chief Operating Decision Maker' and on the basis that this information is reviewed and used to allocate resources to the segments and to assess their performance.
The 'Chief Operating Decision Maker' is considered to be the Board. Based on monthly internal reporting, the Board considers the Group's business from both a services and geographical perspective. However in contrast to the information which was presented using a risks and returns approach, as previously required under IAS 14 'Segmental Reporting', the adoption of IFRS 8 has resulted in minor changes to the identification of the Group's reportable segments.
The Board reviews the performance of the services that are provided by the Group on the following basis: commercial jet services, private jet services, freight services and other support services. Each of these components have been identified as operating segments.
The segmental information, which is provided to the Board for the reportable segments on a monthly basis, is as follows:
Sale transactions between operating segments are carried out on an arm's length basis and all revenues, results, assets and liabilities which are reviewed by the Board are prepared on a consistent basis to those that are reported in the financial statements.
The Board does not review information about the amounts of additions which are made to the operating segments non-current assets. Assets and liabilities are not reviewed at a segmental level, therefore these are not disclosed.
Revenues from external customers are derived primarily from the provision of services within the commercial jets and private jets operations. Revenues are also derived through the offering of freight services and travel support services, including operations and insurance.
|
Half year to 31 January 2010 (unaudited) £'000 |
Private Jets |
Commercial Jets |
Freight |
Other |
Discontinued Operations |
Total |
Discontinued operations |
Adjustments |
Per consolidated financial statements |
|
Total revenues |
18,425 |
47,165 |
22,983 |
9,722 |
3,254 |
101,549 |
(3,254) |
- |
98,295 |
|
Revenues from transactions with other operating segments |
(128) |
(544) |
(78) |
(1,629) |
(910) |
(3,289) |
910 |
(910) |
(3,289) |
|
Revenues from external customers |
18,297 |
46,621 |
22,905 |
8,093 |
2,344 |
98,260 |
(2,344) |
(910) |
95,006 |
|
Profit before tax |
428 |
432 |
88 |
58 |
(1,218) |
(212) |
1,218 |
- |
1,006 |
|
Segment assets |
14,714 |
22,323 |
5,716 |
3,548 |
2,137 |
48,438 |
(2,137) |
- |
46,301 |
|
Half year to 31January 2009 (unaudited) £'000 |
Private Jets |
Commercial Jets |
Freight |
Other |
Discontinued Operations |
Total |
Discontinued Operations |
Adjustments |
Per consolidated financial statements |
|
Total revenues |
20,417 |
71,182 |
10,089 |
1,362 |
5,312 |
108,362 |
(5,312) |
- |
103,050 |
|
Revenues from transactions with other operating segments |
(12) |
(18) |
(1) |
(135) |
(1,062) |
(1,228) |
1,062 |
(1,062) |
(1,228) |
|
Revenues from external customers |
20,405 |
71,164 |
10,088 |
1,227 |
4,250 |
107,134 |
(4,250) |
(1,062) |
101,822 |
|
Profit before tax |
1,002 |
2,491 |
589 |
238 |
(1,100) |
3,220 |
1,100 |
- |
4,320 |
|
Segment assets |
10,898 |
28,191 |
4,226 |
2,952 |
2,756 |
49,023 |
(2,756) |
- |
46,267 |
|
Year to 31 July 2009(audited) £'000 |
Private Jets |
Commercial Jets |
Freight |
Other |
Discontinued Operations |
Total |
Discontinued Operations |
Adjustments |
Per consolidated financial statements |
|
Total revenues |
39,251 |
124,278 |
20,076 |
4,427 |
9,369 |
197,401 |
(9,369) |
- |
188,032 |
|
Revenues from transactions with other operating segments |
(147) |
(580) |
(37) |
(239) |
(2,100) |
(3,103) |
2,100 |
(2,100) |
(3,103) |
|
Revenues from external customers |
39,104 |
123,698 |
20,039 |
4,188 |
7,269 |
194,298 |
(7,269) |
(2,100) |
184,929 |
|
Profit before tax |
3,384 |
1,409 |
749 |
100 |
(4,742) |
900 |
4,742 |
- |
5,642 |
|
Segment assets |
11,929 |
26,288 |
4,502 |
3,128 |
2,602 |
48,449 |
(2,602) |
- |
45,847 |
The Company is domiciled in the UK however, due to the nature of the Group's operations a significant amount of revenue from external customers is derived from overseas countries. The Group attributes revenue to individual countries based upon the location of the assets used to generate those revenues. Apart from the UK, no one individual country is deemed to have material revenue and non-current asset levels, however the Board continues to monitor potential reportable segments.
The Board also reviews information about operating segments on a geographical basis based on the parts of the world which are considered to be key to operational activities. As a result the following additional information is provided showing a geographical split of the United Kingdom, Europe, United States of America and the Rest of the World.
|
United Kingdom £'000 |
Europe £'000 |
United States of America £'000 |
Rest of the World £'000 |
Total £'000 |
|
|
Half year to 31 January 2010 (unaudited) |
|||||
|
Revenues from external customers |
61,140 |
30,793 |
5,132 |
1,195 |
98,260 |
|
Non-current assets |
1,554 |
216 |
1,379 |
- |
3,149 |
|
Half year to 31 January 2009 (unaudited) |
|||||
|
Revenues from external customers |
61,181 |
37,486 |
5,997 |
2,470 |
107,134 |
|
Non-current assets |
5,525 |
252 |
3 |
644 |
6,424 |
|
Year to 31 July 2009 (audited) |
|||||
|
Revenues from external customers |
108,713 |
70,283 |
12,057 |
3,245 |
194,298 |
|
Non-current assets |
3,043 |
214 |
3 |
1,275 |
4,535 |
3 Dividends
|
Half year to 31 January 2010 (unaudited) £'000 |
Half year to 31 January 2009 (unaudited) £'000 |
Year to 31 July 2009 (audited) £'000 |
|
|
Interim dividend for year ending 31 July 2009 of 8.1p per share |
- |
- |
826 |
|
Final dividend for year ending 31 July 2009 of 22.6p (2008: 22.6p) per share |
2,315 |
2,306 |
2,306 |
|
2,315 |
2,306 |
3,132 |
|
The final dividend for the year ended 31 July 2009 was paid on 18 December 2009.
4 Earnings per share
The calculation of the basic and diluted earnings per share is based on the following data:
|
Half year to 31 January 2010 (unaudited) £'000 |
Half year to 31 January 2009 (unaudited) £'000 |
Year to 31 July 2009 (audited) £'000 |
|
|
Earnings |
|||
|
Continuing operations |
|||
|
Earnings for the purposes of basic earnings per share being net profit attributable to equity holders of the parent |
1,202 |
3,291 |
4,677 |
|
Earnings for the purposes of diluted earnings per share |
1,202 |
3,291 |
4,677 |
|
Continuing and discontinued operations |
|||
|
Earnings for the purposes of basic earnings per share being net profit attributable to equity holders of the parent |
(1,189) |
2,499 |
(38) |
|
Earnings for the purposes of diluted earnings per share |
(1,189) |
2,499 |
(38) |
|
Number of shares |
|||
|
Weighted average number of ordinary shares for the purposes of basic earnings per share |
10,241,882 |
10,195,782 |
10,200,067 |
|
Effect of dilutive potential ordinary shares |
23,268 |
13,666 |
43,080 |
|
Weighted average number of ordinary shares for the purposes of diluted earnings per share |
10,265,150 |
10,209,448 |
10,243,147 |
5 Net cash from operating activities
|
Half year to 31 January 2010 (unaudited) £'000 |
Half year to 31 January 2009 (unaudited) £'000 |
Year to 31 July 2009 (audited) £'000 |
|
|
Operating profit for the period |
918 |
3,926 |
5,152 |
|
Adjustments for: |
|||
|
Depreciation and amortisation Costs written off (hangar project) |
221 - |
298 - |
566 536 |
|
Intercompany movement of aircraft |
1,547 |
- |
- |
|
Movement on financial liability |
(4) |
(217) |
(214) |
|
Share option cost for period |
125 |
197 |
353 |
|
Operating cash flows before movements in working capital |
2,807 |
4,204 |
6,393 |
|
(Increase) / decrease in receivables |
(1,669) |
10,664 |
3,881 |
|
(Increase) / decrease in inventories |
(10) |
82 |
10 |
|
Increase / (decrease) in payables |
2,054 |
(9,237) |
(6,613) |
|
Cash generated from operations |
3,182 |
5,713 |
3,671 |
|
Income taxes paid |
368 |
(1,808) |
(2,396) |
|
Interest paid |
(22) |
(3) |
(11) |
|
Net cash from operating activities |
3,528 |
3,902 |
1,264 |
6 Reconciliation of movement of net funds
|
Half year to 31 January 2010 (unaudited) £'000 |
Half year to 31 January 2009 (unaudited) £'000 |
Year to 31 July 2009 (audited) £'000 |
|
|
Decrease / increase in cash in the year |
(1,547) |
651 |
(5,112) |
|
Effect of foreign exchange rate changes |
14 |
741 |
493 |
|
Movement in net funds during the period |
(1,533) |
1,392 |
(4,619) |
|
Opening net funds |
16,137 |
20,756 |
20,756 |
|
Closing net funds |
14,604 |
22,148 |
16,137 |
7 Tax
|
Half year to 31 January 2010 (unaudited) £'000 |
Half year to 31 January 2009 (unaudited) £'000 |
Year to 31 July 2009 (audited) £'000 |
|
|
Continuing operations |
|||
|
Current tax: |
|||
|
UK corporation tax |
(167) |
990 |
743 |
|
Foreign tax |
10 |
117 |
409 |
|
(157) |
1,107 |
1,152 |
|
|
Deferred tax |
(39) |
(78) |
(187) |
|
Total tax on continuing activities |
(196) |
1,029 |
965 |
|
Discontinued operations |
|||
|
Current tax: |
|||
|
UK corporation tax |
(340) |
(308) |
- |
|
Foreign tax |
- |
- |
- |
|
(340) |
(308) |
- |
|
|
Deferred tax |
- |
- |
(26) |
|
Total tax on discontinued activities |
(340) |
(308) |
(26) |
|
Total tax |
(536) |
721 |
939 |
Income tax for the interim period is charged at 31.0% (2009: 22.4%), representing the best estimate of the weighted average income tax expected for the full financial year.
8 Goodwill
|
Notes |
£'000 |
|
|
Cost |
||
|
At 1 August 2008 |
4,374 |
|
|
Additions |
- |
|
|
At 31 January 2009 |
4,374 |
|
|
Provision for impairment |
||
|
At 1 August 2008 |
- |
|
|
Impairment |
- |
|
|
At 31 January 2009 |
- |
|
|
Net book value |
||
|
At 31 January 2009 |
4,374 |
|
|
Cost |
||
|
At 1 August 2009 |
4,374 |
|
|
Additions |
- |
|
|
At 31 January 2010 |
4,374 |
|
|
Provision for impairment |
||
|
At 1 August 2009 |
(2,106) |
|
|
Impairment |
12 |
(1,513) |
|
At 31 January 2010 |
(3,619) |
|
|
Net book value |
||
|
At 31 January 2010 |
755 |
|
The Group tests goodwill annually for impairment or more frequently if there are indications that goodwill may be impaired. Impairment is recognised as an exceptional item above operating profit in the consolidated income statement.
Goodwill has been measured on the basis of its value in use, by applying cash flow projections based on the financial forecasts circulated to the Board covering a five-year period and is allocated to the appropriate cash generating unit. In the case of goodwill in Air Partner International SAS, the period reviewed in terms of financial forecasts is five years. The key assumptions for the value in use calculations are those regarding the discount rates, growth rates and expected changes to selling prices and direct costs during the period. The estimated growth rates are based on past performance and expectation of future changes in the market. The rate used to discount the forecast cash flows from each unit is 10%.
Air Partner Private Jets has suffered from a global downturn in the private jet aviation market, which has led to lower prices, lower yields, less flying hours and less optimisation. The Group has revised its cash flow forecasts for this company as a result and has impaired goodwill to its recoverable amount. The goodwill recognised on the acquisition of Air Partner Private Jets Limited has been fully impaired via the recognition of an impairment loss of £1,513,000. Further details of this are provided in the Chairman's statement.
9 Property, Plant and Equipment
|
Short leasehold property and leasehold improvements £'000 |
Aircraft £'000 |
Fixtures and equipment £'000 |
Assets under construction £'000 |
Motor Vehicles £'000 |
Total £'000 |
|
|
Cost |
||||||
|
At 1 August 2008 |
208 |
855 |
1,401 |
389 |
176 |
3,029 |
|
Exchange adjustments |
- |
(31) |
165 |
- |
8 |
142 |
|
Additions |
10 |
- |
210 |
27 |
41 |
288 |
|
Disposals |
- |
- |
(186) |
- |
- |
(186) |
|
At 31 January 2009 |
218 |
824 |
1,590 |
416 |
225 |
3,273 |
|
Depreciation |
||||||
|
At 1 August 2008 |
56 |
150 |
906 |
- |
65 |
1,177 |
|
Exchange adjustments |
- |
(6) |
140 |
- |
6 |
140 |
|
Charge for the year |
10 |
37 |
141 |
- |
20 |
208 |
|
Disposals |
- |
- |
(186) |
- |
- |
(186) |
|
At 31 January 2009 |
66 |
181 |
1,001 |
- |
91 |
1,339 |
|
Net book value |
||||||
|
At 31 January 2009 |
152 |
643 |
589 |
416 |
134 |
1,934 |
|
Cost |
||||||
|
At 1 August 2009 |
218 |
1,519 |
1,645 |
- |
197 |
3,579 |
|
Exchange adjustments |
- |
(170) |
(33) |
- |
- |
(203) |
|
Additions |
- |
1,547 |
68 |
16 |
1 |
1,632 |
|
Disposals |
- |
(1,518) |
(34) |
- |
(20) |
(1,572) |
|
Assets held for sale |
(99) |
- |
(46) |
- |
(34) |
(179) |
|
At 31 January 2010 |
119 |
1,378 |
1,600 |
16 |
144 |
3,257 |
|
Depreciation |
||||||
|
At 1 August 2009 |
77 |
244 |
924 |
- |
96 |
1,341 |
|
Exchange adjustments |
- |
- |
(30) |
- |
- |
(30) |
|
Charge for the year |
10 |
73 |
98 |
- |
11 |
192 |
|
Disposals |
- |
(317) |
(26) |
- |
(20) |
(363) |
|
Assets held for sale |
(1) |
- |
(24) |
- |
(3) |
(28) |
|
At 31 January 2010 |
86 |
- |
942 |
- |
84 |
1,112 |
|
Net book value |
||||||
|
At 31 January 2010 |
33 |
1,378 |
658 |
16 |
60 |
2,145 |
There were no commitments at the period end to purchase any items of property, plant or equipment.
10 Related Party Transactions
The Company had transactions in the ordinary course of business, during the period under review, with related parties.
|
Half year to 31 January 2010 (unaudited) £'000 |
Half year to 31 January 2009 (unaudited) £'000 |
Year to 31 July 2009 (audited) £'000 |
|
|
Trading Transactions |
|||
|
Subsidiaries |
|||
|
Sales to subsidiaries |
40 |
4 |
114 |
|
Purchases from subsidiaries |
1,021 |
1,276 |
2,477 |
|
Amounts owed by subsidiaries |
483 |
1,711 |
2,160 |
Outstanding balances that relate to trading balances are placed on the inter-company accounts with no specific credit period.
|
Half year to 31 January 2010 (unaudited) £'000 |
Half year to 31 January 2009 (unaudited) £'000 |
Year to 31 July 2009 (audited) £'000 |
|
|
Loans to related parties |
|||
|
Loans to Air Partner Private Jets Limited |
- |
3,000 |
3,000 |
During the period under review, the Lee Baron Group Limited charged fees to the Group of £nil (2009 year end: £33,500) and Gleeds Building Surveying Limited £nil (2009 year end: £55,700) in respect of project management on the development of a hangar in Biggin Hill. P Savile, brother of D C W Savile, a director, is employed by Gleeds Building Surveying Limited and was previously employed by Lee Baron Group Limited. The initial contract negotiation for this year was supervised by S J White and A G Mack, independent of D C W Savile. At the period end there was a balance of £nil (2009 year end: £11,500) owed to Gleeds Building Surveying Limited and £nil owed to Lee Baron Group Limited (2009 year end: £nil)
During the period under review, M Barber was employed as a contractor in the engineering department of Air Partner Private Jets Limited. M Barber, brother of J Barber, a director, is employed by Avmarine Consultancy Limited and was paid £30,030 during the course of the period under review (2009 year end: £28,894). The contract rates were agreed by the Board excluding J Barber. At the period end there was a balance of £6,000 (2009 year end: £4,500) owed to M Barber.
11 Contingent Liabilities
The Group has a terminable indemnity for £240,000 (2009 year end: £240,000) in respect of a passenger sales agency agreement and also a bank guarantee for £4,500 (2009 year end: £4,500) lodged in regard to certain employee rights in Dubai.
12 Discontinued Operations
At the interim report date, the Board were actively looking to sell its subsidiary, Air Partner Private Jets Limited and hence have classified the assets and liabilities associated with the subsidiary as a discontinued operation in accordance with IFRS 5 'Non-current assets held for sale and discontinued operations'.
However on15 March 2010, the planned sale fell through and consequently the Board have decided to put the company into administration.
As a result of this decision, the profits for the forthcoming period to 31 July 2010 will be impacted following the administration process and the estimated financial effect of this is £629,000.
Notes to the condensed consolidated statement of consolidated income
|
Half year to 31 January 2010 (unaudited) Discontinued operations £'000 |
Half year to 31 January 2009 (unaudited) Discontinued operations £'000 |
Year to 31 July 2009 (audited) Discontinued operations £'000 |
|
|
Revenue |
3,254 |
5,312 |
9,369 |
|
Cost of sales |
(2,700) |
(4,394) |
(6,576) |
|
Gross profit |
554 |
918 |
2,793 |
|
Administrative expenses |
(1,757) |
(2,021) |
(5,424) |
|
Impairment of goodwill |
- |
- |
(2,106) |
|
Operating loss |
(1,203) |
(1,103) |
(4,737) |
|
Finance income |
- |
22 |
23 |
|
Finance costs |
(15) |
(19) |
(28) |
|
Loss before tax |
(1,218) |
(1,100) |
(4,742) |
|
Taxation |
340 |
308 |
27 |
|
Loss on disposal of discontinued operations |
(878) |
(792) |
(4,715) |
|
Loss recognised on the measurement to fair value less costs to sell |
(1,513) |
- |
- |
|
Loss for the period from discontinued operations |
(2,391) |
(792) |
(4,715) |
Notes to the condensed consolidated balance sheet
|
Half year to 31 January 2010 (unaudited) discontinued operations £'000 |
|
|
Assets |
|
|
Non-current assets |
|
|
Goodwill |
- |
|
Other intangible assets |
- |
|
Property, plant and equipment |
151 |
|
Deferred tax assets |
- |
|
151 |
|
|
Current assets |
|
|
Inventories |
434 |
|
Trade and other receivables |
1,467 |
|
Current tax assets |
- |
|
Cash and cash equivalents |
85 |
|
1,986 |
|
|
Total assets held for sale |
2,137 |
|
Current liabilities |
|
|
Trade and other payables |
(322) |
|
Financial liabilities |
- |
|
Current tax liabilities |
- |
|
Other liabilities |
(1,165) |
|
(1,487) |
|
|
Net current assets |
499 |
|
Non-current liabilities |
|
|
Deferred tax liability |
(21) |
|
(21) |
|
|
Total liabilities held for sale |
(1,508) |
|
Net Assets held for sale |
629 |
Related Shares:
AIR.L