LONDON (Alliance News) - Gama Aviation PLC boosted its dividend on Monday after profit in 2017 was hurt by the absence of a one-off gain, as revenue grew in a strategically "exciting" year.
In 2017, pretax profit narrowed 16% to GBP16.2 million from GBP19.3 million the year prior. This was despite revenue growing 2.2% to GBP207.4 million from GBP203.0 million the year before.
Profit performance was primarily hurt by the comparison to a GBP9.8 million finance income gain in 2016 which was not repeated in 2017. On an underlying basis, pretax profit expanded 25% to GBP17.1 million from GBP13.7 million the year prior.
Gama proposed a 2.75 pence per share full year dividend, up 5.8% from 2.6 pence the year prior.
"We are pleased to report financial results for 2017 in line with expectations," Gama Chief Executive Officer Marwan Khalek said. "In particular, we have increased our operating margins and delivered improved operating cash flow."
"Strategically this is an exciting time for Gama Aviation, having recently completed our successful GBP48 million fund raising," Khalek added. "This will allow us to deliver significant growth and scale across all geographies and service lines, enabling us to make further value enhancing acquisitions from within our fragmented market and will help us to fulfil our ambition of becoming the global leader in business aviation services."
In February, Gama raised GBP48.0 million through the placing of 19.6 million shares at 245 pence each. At the time, Gama explained USD18.9 million of proceeds will go towards acquiring Hutchison Capital Holdings Ltd's Hong Kong aviation interests. This comprised a 50% stake in Gama Aviation Hutchison Holdings Ltd and a 20% stake in China Aircraft Services Ltd.
"In US Air, following the BBA aircraft management business merger, we are now the market leader in US business aviation management," Khalek continued. "This offers us cross-selling opportunities into our US Ground division. We will leverage customer relationships across our national network and invest in base facilities to increase the scale and scope of services."
In January 2017, Gama agreed to merge its US aircraft management unit with the aircraft management and charter business of BBA Aviation Ltd to create a joint venture.
"Europe Air is positioned for sustainable growth and we continue to build our offering in Europe Ground," Khalek said. "The acquisitions in Europe have been successful and have added significant value."
"Recent corporate developments by us in the Middle East and Asia, together with the proposed construction of a business aviation centre in Sharjah will accelerate growth," Khalek added.
"With Hutchison as a strategic investor," Khalek continued, "the addition of two experienced non-executive board directors and the strengthened management teams across the regions, we are well positioned for growth in 2018 and beyond."
Shares in Gama Aviation were up 0.1% at 255.35 pence on Monday.
