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US market drives growth at Gama Aviation
Business aviation services provider Gama Aviation updated the market on its trading since 1 January on Tuesday, reporting that trading across both its air and ground divisions had been "broadly satisfactory" although flat compared with last year, as its shareholders gathered for its annual general meeting.
The AIM-traded firm said conditions in Europe were "somewhat challenging", while conditions in the US were supporting strong growth.
Its EU air division's performance remained "stable" as it continued to expect modest growth for the year as a whole.
The US air associate was said to be continuing to deliver strong organic growth, enhanced by its Wheels Up contract, while the Middle East and Asia air divisions made "good progress" in scaling their operations.
On the ground, Gama said the EU ground division performance had been somewhat mixed, with some modest like-for-like revenue growth in the period supported by high-quality contract wins for base maintenance and design - the full effect of which would be seen in the second half of the year.
The recently-announced move to Bournemouth International Airport would allow the division to double its engineering capacity, improve its operational efficiency and extend its service offering.
Gama said its US ground division delivered "strong" organic revenue growth, with new clients continuing to be attracted to its line maintenance centres.
The further development of its US network was progressing well, the directors claimed, and they expected to be adding base maintenance capacity on both coasts in line with its 2018 strategic plan.
At the Middle East ground division, the group experienced a weak start to the year, with movements at the FBO being affected by regional events.
The group said its investment in the Sharjah BAC was progressing "well", with the design phase well-advanced, remaining on-track to open in the fourth quarter of 2019.
In Hong Kong, its collaboration with CASL was said to be making "good progress", and had started to deliver revenues.
Following its equity placing in March, Gama said it was "confident" in delivering its strategic growth plan for 2018.
The anticipated investments in US and Middle East ground were underway, and the group continued to actively review potential acquisition candidates, particularly, in Europe and the Middle East.
Additionally, Gama said it had further strengthened its leadership team with the appointment of a new CFO, a director of corporate development, and a COO of the US ground division.
As it had recently announced, David Stickland would be joining as the group CFO on 1 September.
Richard Kearsey was appointed as director of corporate development on 8 March to help deliver on the 2018 strategic plan and future acquisition strategy, the board said, and it also recently appointed Walter Berchtold as COO of the US ground division, in a bid to drive the performance and delivery of organic investments in that division.
Gama also gave an update on its ongoing litigation, confirming that during the period, it either resolved or settled on four out of the 10 previously-disclosed legal proceedings.
Those included Taz Hawker, ACC Columbia; the litigation with Credit Suisse arising from claims against Igho Sanomi, and Ukraine State Aviation Administration.
Two claims against the company had been inactive, with the board saying it was continuing to "vigorously pursue [or] defend the outstanding proceedings,", saying it remained confident that the overall awards and settlements would result in a cash inflow to the company.
"I am pleased with the progress that we are making in implementing our 2018 strategic plan which is tailored to ensure that, through a mix of organic investments and acquisitions, each division in the group receives the necessary support to allow it to address its specific growth opportunities," said chief executive Marwan Khalek.
"With the strengthened leadership team now established, we are even better equipped to deliver on our strategic objectives."
Gama Aviation said it would issue its half year trading update on 19 July.