New Zealand’s largest general aviation company, which has extensive scenic tourism and charter flight interests, has reported interim net profit after tax of $12.7m.
Airwork’s result for the six months to the end of December last year was an increase of 9.5% on the previous corresponding period’s $11.6m and came despite “challenging market conditions” for its helicopter division.
The Auckland-based company owns INFLITE Charters, which offers private plane and helicopter charter scenic flights and activities such as heli-fishing, heli-skiing, and private island dining.
INFLITE launched a joint venture with Fox Glacier Guiding last year to offer Mount Cook glacier guiding tours.
INFLITE’s performance was not detailed in the results but owner Airwork’s total revenue increased by 1.3% on the prior period to $84.5m, with earning before interest and tax up 10.5% to $50.3m due to “significant expansion of the Fixed Wing Division including the impact of contracts that commenced in the prior year”, said the company.
However, the Fixed Wing Division’s growth was partly offset by a reduction in the Helicopter Division due to continued challenging market conditions.
“The Helicopter Division’s performance is expected to improve in the second half with the commencement of two projects delayed from the first half, and greater helicopter sales and maintenance, repair and overhaul activity,” said Airwork.
“Headwinds in the helicopter industry continue, in particular in the resources sector. Airwork’s helicopter business will continue to focus on diversifying its customer base and expanding its global footprint.”
Based on current and expected trading for the remainder of the year, Airwork forecasts a net profit after tax of approximately $25m for the 2017 financial year, up slightly on 2016’s $24.6m.
Airwork is subject to a partial takeover by Chinese machinery firm Zhejiang RIFA Holding Group. The takeover depends upon Chinese regulatory approval and confirmation that Airwork’s operations will remain unaffected by the deal.
RIFA is purchasing 75% of Airwork’s ordinary shares at $5.40 per share. Its offer to shareholders closed on March 5 and it has until April 5 to make it unconditional.
“The takeover process has been protracted and inevitably this has been a distraction for the management team at times,” said Airwork.
“Notwithstanding, Airwork believes that the involvement of RIFA can open up exciting new opportunities for the company to leverage its expertise into the Chinese market and the wider Asia region.”
No dividend was declared in line with the conditions of RIFA’s partial takeover.