Shares in AIM-listed aircraft leasing firm Avation (LON:AVAP) jumped 13.33% to 175.67p (as of 15:20 BST) after the company reported a 14% increase in revenues for the nine months ended 31st March. Pre-tax profits for the period were up 173%.
Executive Chairman Jeff Chatfield commented: “Avation is pleased to present its unaudited financial results for the nine months ended 31 March 2020. Revenue from the aircraft leasing business grew steadily throughout the first nine months of the year and the Company is in a strong financial position.
“The Company is releasing these unaudited interim accounts to provide investors with an up to date report on the business as we progress through the COVID-19 pandemic. This one-off presentation was undertaken to provide updated information about Avation’s position at a time of uncertainty in financial markets.
“Immediately at the outset of the COVID-19 pandemic Avation instituted a programme of support for some of its airline customers to defer for later payment certain portions of their rent in the short term. The cashflow impact of this support programme has been mitigated by adjusting the amortisation profiles of the relevant financings with the agreement of lenders. Since the outbreak of COVID-19 the Company has also reduced administration costs and has instituted a pause on capital expenditure with the goal of maximising cashflow.
“Avation has a strong cash balance of $131.6 million as at 31 March 2020. The Company is fortunate that some of its largest customers are in countries where there has been comparatively lower impact from the pandemic. We are now observing a gradual return to service of certain customers including VietJet, airBaltic, EVA Air and Mandarin Airlines which presently represent over 60% of Avation’s future unearned contracted leasing revenue.
“Avation is optimistic about the long term opportunity for airline travel particularly the turboprop and narrow-body aircraft sectors“.