Signature Aviation has released a trading update for the six months to 30 June 2020. CEO Mark Johnstone says: “Since our AGM statement in mid-May, flight activity across our global network has continued to show an encouraging recovery and, in the US, with the support of the CARES Act, we have now called back all our furloughed staff. As we look forward, I remain confident in the resilience and potential of our market leading FBO business model, the quality of our unique network, the strength of our liquidity and therefore our ability to continue to invest in and grow our attractive and high return business. Thus, we are delighted to have recently reached an agreement to acquire two FBOs in Switzerland, including Geneva, which is a highly strategic addition to our network. Finally, and as a precautionary measure given the macroeconomic uncertainties, we have secured a covenant waiver from our relationship banks for December 2020 and June 2021.”

In line with its strategic growth target to grow customer value through expanding our network, Signature is pleased to have reached agreement to acquire TAG Aviation FBO SA. The acquisition comprises two FBOs in Switzerland, namely the strategically important location in Geneva, which has been a Signature target for some time, and Sion.

Geneva is the second largest trafficked general aviation location in the EMEA region, with strong connectivity to other locations in Signature European FBO network such as Paris, Luton and Nice. TAG is the largest operator at Geneva and is well located on the field. The transaction is expected to close in the third quarter.

Signature has also continued to invest growth capital during the COVID-19 period and was pleased to have recently opened its newly constructed Atlanta FBO, which has been built to LEED silver standard.

Flying activity across the group's US network through to the third week of March was in line with its expectations and Signature saw limited impact on its fuel volumes from COVID-19. Although it experienced an average 77 per cent year on year reduction in flight activity during April, it has seen a substantial recovery in flight activity over the last two months. Flight activity during May was down by an average of 58 per cent and Signature has seen a further significant recovery during June with flight activity down by an average of 32 per cent.

Signature Aviation says it entered this period of uncertainty in a strong financial position and has proactively taken decisive steps to preserve liquidity, including reducing costs and capital expenditure and suspending the group dividend. As a result, notwithstanding the severe impact of COVID-19 on its operations, the group remained net cash flow positive in the second quarter.

Signature's engine, repair and overhaul (ERO) business continues to operate as expected and has seen minimal impact from COVID-19 on revenues so far this year. In the six months to June revenues declined 1.9 per cent compared to the prior year. On a like-for like basis (adjusting for constant currency) revenue was down 1.4 per cent.

All guidance remains suspended. Signature will continue to monitor the COVID-19 recovery closely and will provide further updates when it publishes its interim results in early September. Furthermore, its board will review the deciSion on suspenSion of dividend payments as trading conditions become clearer.