12th Nov 2009 07:00
12 November 2009
Interim Management Statement
BBA Aviation plc, the focused aviation services and systems support group, is today issuing an Interim Management Statement for the period from 1 July to 11 November 2009.
The Group's performance for the period was in line with the Board's expectations, despite the ongoing difficult trading environment and some weakening in the US Dollar/Sterling exchange rate since the half-year.
The signs of stabilisation in most of our markets, highlighted in our 2009 interim results announcement, have continued. In the business and general aviation market, absolute month-on-month flight operations continue to improve, and the rate of year-on-year decline in flight activity moderated to 22% to the end of October compared to 24% to the end of June. The year-on-year reduction in commercial aviation flight activity is unchanged from the half-year at 10%.
Against this background, group revenue for the year to 31 October was only 11% lower on an organic basis (after adjusting for acquisitions and disposals, exchange rates and fuel prices) than the comparable period last year, an improvement on the 13% decline reported for the first half.
In Flight Support, the organic revenue decline year to date was limited to 8%, compared with 11% in the first half of the year. Signature continues to perform strongly relative to its markets. Although it is too early to predict a more broadly based market recovery, in October Signature USA saw modest organic volume growth over the same month last year for the first time since the end of 2007. ASIG continues to perform strongly as it enters the de-icing season.
In Aftermarket Services and Systems, organic revenue decline year to date was broadly unchanged from the first half at 17%, with the later-cycle ERO businesses experiencing weak market conditions across a number of engine programmes as expected. Legacy Support continues to perform well, but APPH is still being impacted by OEM production cutbacks and a lack of demand for MRO work on regional turboprops.
Cash generation remained strong over the period and net debt on a constant currency basis has been further reduced. This is despite the $13m final payment in July in relation to the Honeywell APU licence. The continuing focus on cash generation is expected to result in a further reduction in net debt by the end of the year.
Commenting on the Interim Management Statement, Simon Pryce, Chief Executive said:
"Whilst market conditions remain challenging, they have been more stable for the last four months. The actions that we have taken to date have ensured that our business continues to operate robustly and this gives us confidence in our performance for the year, despite the translation impact of a weaker US Dollar/Sterling exchange rate.
The continued outperformance of our market leading Flight Support businesses, the group wide cost reduction actions, our service and aftermarket focus and our continuing strong cash generation underline the through-cycle resilience of BBA Aviation. We are well positioned to benefit from a cyclical recovery and the secular growth inherent in our markets."
BBA Aviation plc will issue its Preliminary Results for the year ended 31 December 2009 on 25 February 2010.
Enquiries:
BBA Aviation plc
Andrew Wood, Finance Director
020 7514 3950
Brunswick Group LLP
Simon Sporborg / Jayne Rosefield
020 7404 5959
Notes to Editors
BBA Aviation plc is a world leader in the provision of Flight Support and Aftermarket Services and Systems for business aviation, regional airline, military and commercial aviation operators, including FBO services, fueling, ground handling, turbine engine repair and overhaul and aviation components, landing gear and hydraulic systems. BBA has leading positions, well-known and reputable brands and a proven track record of organic and acquisition-led growth. BBA Aviation companies include Signature Flight Support, ASIG, Executive Beechcraft, Ontic, International Governor Services, APPH, Dallas Airmotive, Premier Turbines, H&S Aviation, International Turbine Service and Barrett Turbine Engine Company. For more information, please visit www.bbaaviation.com.
This statement is available in electronic format from the Company's website, www.bbaaviation.com.
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