Hangar8 (AIM: HGR8), one of Europe's largest operators of privately owned passenger jet aircraft, today announces a trading update for the 14 months ended 30 June 2011. The Company’s final results for the period, its first as a publicly quoted business, will be released in October 2011.
Turnover for the 14 months to 30 June 2011 is expected to be approximately ?18.4 million, an increase of 70% on the year to April 2010. Gross margin improved to c.20% as a consequence of better management of both the Company’s controllable costs and its sales processes. The Company expects to report an operating profit for the period, before the one-off costs associated with the IPO in November, in line with management expectations. Cash balances at the period end were ?2.1 million and the Company has no debt.
Management are delighted with the outstanding operational performance of Hangar8 during the period. As at 30 June 2011, Hangar8’s fleet of managed aircraft totalled 32. This is an increase of four since the Company’s announcement of 6 May 2011, and an increase of 68% compared to 19 aircraft at the time of the IPO in November 2010. Five new aircraft types have been added to the Company’s Air Operator Certificates (of which the Company now have 13) and Hangar8 is now the second largest operator of private jet aircraft in the UK and Europe and the largest charter fleet operator of Hawker aircraft in the world.
In addition to the strong organic growth shown above, new bases have been added in Europe and Africa, broadening the Company’s geographic presence. Management continue to examine and evaluate the viability of other operational bases in strategic locations.
The Company experienced, and is still experiencing, strong charter demand across its fleet. Operators that own their assets, many of which are currently in negative equity, have been forced to charge uneconomic charter rates in order to cover their costs. They have been unable to sustain this and have been falling by the way side allowing Hangar8 to increase its market share with a more competitive pricing structure.
Dustin Dryden, Chief Executive of Hangar8 commented:
“I am delighted with our progress in our first full year as a listed company. We have invested across the Group, including strengthening and professionalising the Board and senior management team with the appointment of Philip Brady as Chief Financial Officer, as well as our wider operational infrastructure and flight crews. Financially, we have performed well in a difficult market and we now have a strong platform from which we can continue to expand. This has all been achieved without abandoning the corporate culture of fun and ‘can-do’ that brought us our original success.
I am confident there are still good organic growth opportunities in our current markets but with our strong brand and existing platform will continue to investigate expanding our geographical reach by opening bases in new jurisdictions. We will also review acquisitions on a case by case basis and pursue those which we feel are strategically important to us.
However, our focus remains on customer service. We believe that quality – in the standard of aircraft, flight crews and service are of more importance to charter customers than absolute price. This is as true for private sector customers as it is for international government customers (for whom Hangar8 arranged flights for the first time in the year). As we gain critical mass our owners will benefit further from our increased buying power across all areas of aviation expense. I look forward to providing shareholders with a more detailed review of the year, together with an update on the current financial year, at the time we report full final results.”