LONDON (Alliance News) - BBA Aviation PLC Wednesday reported higher pretax profit for 2014, as strong earnings growth in its flight support business offset a weaker-than-expected performance in its aftermarket services business, and said it expects further "good growth" in 2015.
The company, which provides flight support services like refuelling, ground handling and de-icing, and aftermarket services including aircraft engine repair and parts provision, reported a pretax profit of USD152.4 million for 2014, up from USD245.2 million in 2013, as revenue rose to USD2.29 billion, from USD2.22 billion.
Organic revenue rose 8% in its flight support business, while the operating profit excluding exceptional items rose 14%. This offset a 4% organic revenue decline and 12% underlying oeprating profit decline in its aftermarket services business.
It raised its dividend for the year to 16.2 cents, from 15.4 cents in 2013, although it said it was pausing its share repurchase programme which was 62% complete on March 4, saving the money for "a continued strong pipeline of value creative opportunities".
For 2015, BBA is expecting further good growth for its flight support business, driven by its Signature unit and as improvements at its ASIG business offset the loss of a ground-handling contract at John F. Kennedy International Airport in New York.
It said its Legacy aftermarket services business remains solid, its ERO unit has stabilised, while it expects rationalisation in the aftermarket services area as a whole to offset ongoing market weakness.
"In addition, our overall performance will be supported by further incremental contributions from the substantial investments made across the group in recent years. The board therefore expects further good growth in 2015," BBA Chief Executive Simon Pryce said.
Still, BBA Aviation shares were down 2.1% at 335.80 pence early Wednesday.
By Steve McGrath; stevemcgrath@alliancenews.com; @stevemcgrath1
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