Strong group and cargo charter business in May following record trading in April has pushed Air Charter PLC to an underlying profit before tax of £7.5 million for the first four months of its financial year. The company described the results as “well ahead” of budget.
The estimated results were announced today as part of management’s ongoing updates being released every four to six weeks during the current Covid-19 pandemic that has caused a crisis across the greater travel industry.
Although activity in its Private Jets has been weak throughout the pandemic, Air Partner said it is now starting to see early signs of recovery.
In May, its U.S. Private Jets business had double the level of inquiries for future flight bookings compared to April, and JetCard inquires in Europe have also increased.
However, Group Charter helped keep the company’s fortunes moving forward. While initial crisis activity was emergency evacuations and repatriation work, a large proportion of current demand is for corporate shuttles, as companies in the U.K. and U.S. seek to safeguard their employees.
Freight was also a star flying emergency protective personal equipment (PPE) from Asia to the U.K., Europe and U.S.
And in more positive news, Air Partner said in addition to the emergency activity, it is beginning to see some recovery in core Freight activity as well.
The company remains cautious on predicting the future.
In its update, Air Partner said, “While we expect crisis work to slow down in H2, we expect this to be replaced by a recovery in activity in our core Freight business, Private Jets and Safety & Security.
“Nevertheless, there are undoubtedly challenging times still ahead and we continue to monitor the situation extremely closely, while prudently managing costs tightly across the Group to preserve cash and maintain our working capital.”
At the end of May, the Group has normalized cash in the bank of £16.5 million, excluding “significant customer deposits and JetCard cash.”
Air Partner also has access to a total debt facility of £14.5 million, comprising a £13 million revolving credit facility and a £1.5 million overdraft.
As at 31 May 2020, the Group had drawn down £11.5 million of its RCF. The RCF is due to expire in February 2023.
Analyst Greg Poulton of N+1 Singer wrote, “The forward order book for June is also strong, with continued demand for Freight and Group Charter services.”
He added, “We believe the Group is well placed to achieve a strong FY21 given the diversity of its model and the strength of the balance sheet.”