Alliance Aviation Services (AQZ) H1 2025 earnings summary

Executive summary

• Record half-year revenue of AUD 339 million (up 11% year-over-year), with EBITDA of AUD 101.2 million and profit before tax of AUD 41.3 million, driven by increased flight hours and fleet expansion.

• Flight hours reached 58,362 (up 14.9%), with 76 aircraft in service, including 38 E190s and 38 Fokkers.

• 98% of flights operated on long-term contracts, providing stable revenue.

• Major contract renewals and wet lease growth supported profitability, though BHP Nickel West's transition reduced contract revenue.

• Industrial action and aircraft damage impacted on-time performance and increased costs.

Financial highlights

• Wet lease revenue increased by AUD 32 million (25%) to AUD 160.1 million, with contract revenue stable at AUD 153.6 million.

• Net assets rose 7% to AUD 440 million; net debt increased to AUD 425.5 million, mainly to fund aircraft and hangar acquisitions.

• Net operating cash flow (excluding aircraft purchases) was AUD 27.2 million; statutory net cash from operating activities decreased by AUD 15.1 million.

• Total capital expenditure for the period was AUD 145.7 million, with FY25 forecast at AUD 262.4 million.

• Basic EPS increased to 17.95 cents; net profit after tax up 10% to AUD 28.9 million.

Outlook and guidance

• Guidance unchanged: FY25 consensus forecast of AUD 92.9 million PBT and AUD 202.1 million EBITDA.

• Wet lease activity expected to remain strong, with further E190 deployments and ongoing investment in fleet and facilities.

• Net debt expected to reduce to around AUD 410 million by year-end, remaining stable through FY26 as operating cash flow funds further aircraft purchases.

• 13 E190 aircraft remain to be purchased by 2H26, with an estimated cost of USD 103 million.

• No interim dividend declared; capital retained for growth and debt repayment.