Alliance Aviation Services (AQZ) H1 2026 earnings summary

Executive summary

• Half-year results were disappointing, with a statutory net loss after tax of $105.8 million, primarily due to $164.8 million in impairments and write-downs on the Fokker fleet and related assets, and a commercially unviable wet lease contract.

• Underlying EBITDA was $87.4 million, profit before tax $14.6 million, and underlying NPAT $11.9 million, all materially lower year-over-year.

• A turnaround plan is underway, focusing on capital allocation, free cash flow, asset sales, cost controls, and a comprehensive review of operations and leadership.

• Aircraft trading activity ceased as of 31 December 2025 to reduce volatility and focus on core operations.

Financial highlights

• Underlying revenue for the half was $368.8 million, up 9% year-over-year, with record flight hours exceeding 59,000.

• Underlying EBITDA declined 14% to $87.4 million, and underlying NPAT fell 59% to $11.9 million compared to 1H25.

• Net debt at period end was $433.4 million, with net tangible assets per share at $2.22 and net assets at $357.9 million.

• Operating cash flow before aircraft purchases was $8.2 million, with cash conversion weaker than desired.

• No interim dividend declared for 1H26, but a final FY25 dividend of 3.0 cents per share was paid.

Outlook and guidance

• Full-year 2026 underlying profit before tax is expected to be $35–40 million, reflecting the cessation of aircraft trading and reduced depreciation following fleet impairment.

• Guidance reflects ongoing uncertainty around wet lease negotiations, asset divestments, and cost efficiency delivery.

• FY26 results are expected to be materially below analyst consensus due to higher depreciation, increased operating costs, and contract disputes.