Last year BBA Aviation (BBA) snapped up a company called Landmark Aviation: a fitting name, given management's bullish claims that the acquisition will "fundamentally transform" the business. It certainly has had a 'landmark' impact on this year's earnings per share, given the dilutive impact of the $1.1bn rights issue launched in October 2015 to fund the acquisition. So what looks like a rotten set of figures is actually, in management's words, "satisfactory".
Ignoring the $1.1bn rights issue, earnings per share would have risen 1 per cent to 30.9¢, while the dividend per share would have increased by 5 per cent to 17¢. BBA's flight support division, which operates under the Signature brand, generates 73 per cent of group profits and saw underlying profits rise by a fifth to $158.5m, as good operational performance offset lower revenues. The addition of Landmark will only augment the division's importance.
After-market services, which include its engine repair business, continue to be an issue. Underlying operating profits there dropped by a third and management flagged further cost cuts.
Analysts at Liberum expect adjusted pre-tax profits of $256m in the 2016 financial year, leading to EPS of 20.2¢, compared with $170m and 20.1¢ in 2015.
BBA AVIATION (BBA) | ||||
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ORD PRICE: | 194p | MARKET VALUE: | £2bn | |
TOUCH: | 194p-194.3p | 12-MONTH HIGH: | 254p | LOW: 150p |
DIVIDEND YIELD: | 4.9% | PE RATIO: | 24 | |
NET ASSET VALUE: | 211¢* | NET DEBT: | 30% |
Year to 31 Dec | Turnover ($bn) | Pre-tax profit ($m) | Earnings per share (¢)** | Dividend per share (¢)** |
---|---|---|---|---|
2011** | 2.14 | 164 | 23.0 | 9.9 |
2012** | 2.18 | 125 | 16.4 | 10.4 |
2013** | 2.22 | 145 | 20.5 | 10.9 |
2014** | 2.29 | 152 | 17.4 | 11.5 |
2015** | 2.13 | 95.3 | 8.2 | 9.6 |
% change | -7 | -37 | -53 | -17 |
Ex-div: 7 Apr Payment: 20 May *Includes intangible assets of $1.15bn, or 112¢ a share £1=$1.41 **Adjusted for 2015 six-for-five rights issue at 133p |