China Aircraft Services
FBO/Handler (Sharjah International / Sharjah)
Gama Aviation Engineering
Jet East, a Gama Aviation company
BAN's World GazetteerGeorgia
Gama Aviation has announced a collaborative scheme between two talented business aviation design teams and its own Fort Lauderdale, USA, and Bournemouth, UK, maintenance centres.
The roster will showcase some of the brightest talents in the business, providing them with another marketing channel as well as allowing them to team up on the technical side of completions with the Gama Aviation team. The combination provides clients the ability to translate their vision into an attainable reality.
The first two roster members, Autumn Elizabeth Design and MBG International Design, will be showcased across Gama's social channels and web site from next week, with interviews and Q&As being scheduled later in the month.
Chief marketing officer Duncan Daines comments: “Showcasing the fantastic, independent design talent that our sector has is a privilege, and I believe there is no better time to launch such an initiative. Our first two design teams on the roster have strong credentials regularly demonstrating the ‘art of the possible’ whether that is a full refit, external paint or understanding how to present the aircraft to be more attractive in the Part 135 charter market.”
Nikki Gledhill, CEO and creative director of MBG International, adds: “Gama Aviation has an excellent global reputation, which made teaming up with it an easy decision to make. Likewise, MBG International has a strong portfolio of transformation projects that we have undertaken for clients in the US and elsewhere. Therefore it seemed like an ideal way for us to work with it on completions and post completion support as it has a strong global network.”
Autumn Duntz, principal, Autumn Elizabeth Design says: “My clients demand high quality creativity and advice. This is a great opportunity to share Autumn Elizabeth Design's customer-centred designs by utilising Gama Aviation's global reach. I'm excited to be collaborating with an organisation that has a shared value of providing customers with bespoke customised solutions.
Daines concludes: “Given the current global situation I believe it's important that we assist smaller companies and use our platforms to showcase their considerable talents. The roster is symbiotic, but independent, providing our clients, as ever, with the benefit of selecting best in breed services for all their business aviation needs.”
Gama Aviation has also updated investors on the continuing impact of COVID-19 and on its results for the year ended 31 December 2019 (FY19).
The group has stated that its overriding priority remains the health and wellbeing of its staff and clients, and it is continuing to follow national government guidelines in the regions in which it operates. Since the outbreak of the pandemic, the group's management has held daily global leadership team calls to review and update its guidance to employees, manage business continuity measures, and coordinate controls on expenditure and cash.
The US Ground division achieved 85 per cent of planned maintenance activity in March but is now suffering a marked decline with activity below plan by over 50 per cent in the first week of April. The business has prepared an application for financial support from the federal government via the Paycheque Protection Program.
In Europe, service delivery on long-term contracts with NHS Scotland, the MoD and other government agencies is on-going. However, in the Air division charter sales are heavily impacted and in the Ground division other maintenance, overhaul and design activities are experiencing significant impacts as orders have been cancelled or delayed. Ground division labour hours were below plan by over 20 per cent in March and are down by 50 per cent in April so far. A small number of Air and Ground staff have been furloughed and this process will be extended to mitigate the financial impacts of reduced sales.
After a brief shutdown of flights in March, operations at Sharjah have resumed at around 60 per cent of the budgeted levels. Gama's operations there are benefiting from a waiver of airport fees and rental charges for three months and internal savings measures are being implemented.
All Hong Kong aviation remains severely disrupted with consequent major impact on the group's associate, China Aircraft Services Ltd (CASL). The Asia Air and Ground divisions have been less affected due to their business models, with the impact of reduced flying offset by strong maintenance activity on parked aircraft.
Impacts to FlyerTech and myairops have been limited to date, with some disruption to sales activities but also strong market interest in myairops software products due to their cloud deployment model supporting home-working and rapid on-boarding.
In terms of liquidity, the group retains a $50 million credit facility with HSBC of which $30 million remains undrawn and it currently has $17 million of cash following the receipt in March of a substantial annual advance payment in respect of a long-term contract. Gama remains focused on improving the collection of receivables, eliminating non-essential spend, mitigating costs and making use of all available financial support to ensure it preserves the group's healthy liquidity position.
Given the continuing operational and financial uncertainties resulting from the COVID-19 pandemic, the group's financial guidance for the year ending 31st December 2020 remains suspended.
The board remains committed to publishing its annual audited accounts at the earliest opportunity, whilst ensuring that the work required is concluded diligently and comprehensively. Given the disruption to the year-end process caused by the impact of COVID-19, it now expects to publish its annual audited accounts before the end of July 2020. Accordingly, it will be applying to AIM for an extension to the current reporting deadline of 30 June 2020, in accordance with recently announced temporary measures.
On 2 March 2020, the group announced the sale of its US Air associate, Gama Aviation Signature, for a consideration of $33 million, comprising $10 million in return for its 24.5 per cent equity interest and $23 million for accelerated branding fees and other trading related considerations. The sale had originally been expected to close in 2019.
Group revenue and rebate shortfalls associated with the separation and divestment of the US Air business were identified and the group had previously expected to recognise revenue in 2019 to compensate for this shortfall through a $3 million apportionment of the non-equity element of the purchase consideration.
The audit committee regularly assesses the appropriateness of the group's key accounting judgments and treatments to ensure the results provide a true, fair, balanced and reasonable presentation of its financial performance in conformity with accounting standards. Following a meeting of the audit committee it was concluded that, given the sale was delayed, the $3 million apportionment should be accounted for in 2020. It also concluded that various costs, totalling some $1.2 million, principally relating to items previously excluded from underlying trading costs, should be reclassified and included. Consequently, these re-classifications will result in a $4.2 million reduction in the group's adjusted EBIT for 2019 but will not have any cash impact.
While the audit is on-going, the board will continue its normal review of judgments in respect of its receivables, inventory and the carrying values of goodwill and intangibles to ensure it takes full account of the COVID-19 impact which could result in further audit adjustments.
Marwan Khalek, chief executive officer, says: “While we are undoubtedly facing significant challenges posed by the impact of COVID-19, Gama Aviation has a good level of liquidity and the group's resilient business model is supported by our essential contracted services and global reach. With the continuing support of our people, clients and shareholders, we believe we will be able to navigate these challenges and re-focus on delivering sustainable returns once the impact of COVID-19 has receded."