Highlights
Markets: Continued US B&GA growth
US business & general aviation movements up 1%
European business & general aviation movements down 3%
Commercial aircraft movements down 1% in North America and up 2% in Europe
Flight Support (76% of Group OP): Very strong performance driven by Signature
Revenue up 7% (adjusted for fuel and FX); underlying operating profit up 19%
Signature: further market outperformance and good operating leverage
ASIG: satisfactory underlying progress given net contract losses and Singapore exit
Outlook: continued strong progress despite lower than anticipated B&GA movement growth
Aftermarket Services (24% of Group OP): Weaker than anticipated due to impact of ERO footprint rationalisation
Revenue up 6%; underlying operating profit down 33%
ERO: greater than anticipated throughput inefficiencies associated with ongoing footprint rationalisation
Legacy Support: satisfactory performance in line with expectations
Outlook: ERO footprint rationalisation challenges addressed and expected to materially improve H2 performance, supported by strong Legacy order book
Strategic progress
Flight Support further expansion: successful integration of the 11 FBOs added in 2014 and a further 8 Signature SelectTM locations added in H1 2015
Aftermarket Services growth: further extension of Legacy Support's product portfolio from important new licensors, $10.8 million acquisition
Good progress on FBO development projects and ERO rotorcraft expansion
Strong pipeline of value creative opportunities
Dividend increased by 5% reflecting continued confidence in Group's future growth prospects
Simon Pryce, BBA Aviation Chief Executive Officer, commented:
"The Group delivered a good first half overall. Flight Support's very strong performance was driven by Signature's excellent operational delivery, with continued buoyant customer demand for its services across its unique, growing and world leading network. This more than offset ongoing challenges in ASIG and an unsatisfactory contract in Singapore which we have now exited.
Aftermarket Services delivered a weak first half due to greater than anticipated production inefficiencies within ERO associated with the ongoing footprint rationalisation programme. These inefficiencies were addressed at the end of Q2 and support a much stronger performance in the second half as evident in June and July trading. Legacy delivered well as anticipated.
We remain confident in the full year outlook. We have strong momentum in Flight Support, with Signature's continued outperformance and reduced start-up costs in ASIG. In Aftermarket Services, we anticipate a more positive second half performance as the efficiency improvements in ERO feed through, underpinned by the completion of new licence adoptions and a strong order book in Legacy. This coupled with a continued, albeit slow, recovery in our major markets gives us confidence that 2015 will be a year of good growth with strong momentum into 2016."
