Re: Avation (AVAP)
Posted: January 23rd, 2024, 9:43 am
A couple of charts:
Adjusted Return on Equity
Net Spread
Video Interview
An anemic interviewer asking, yet again, the wrong/inappropriate/amateurish questions. Might have been more informative to ask about the weather. I just put the link here for reference but cannot recommend anyone viewing it.
Random News
Ransomware
Aercap (2000+ aircraft lessor) confirmed a cyber incident related to ransomware on 17 January.
Aercap says its investigation into this incident, including the extent to which data may have been exfiltrated or otherwise impacted, remains ongoing. Aercap reportedly faced a 29 January deadline to reach an agreement with a new cyber threat group before it released data allegedly belonging to the NYSE-listed company.
Air Travel
The International Air Transport Association (IATA) has released data for November 2023 air travel performance, indicating that air travel demand topped 99% of 2019 levels. Asia-Pacific capacity rose 58% and the load factor was up 2.9 percentage points to 82.6%.
Research by Airfinance Journal has shown the depths to which airline ratings fell during the pandemic, which ravaged airline profitability, liquidity and balance sheets. The airline industry was, on average, rated a consensus BB before the pandemic, with the index weighted by the size of the airline, but this fell to CCC+ in the depths of the crisis in 2020-21.
ATR
The top performer in the turboprop segment is the ATR72-600, which has seen an average 8% increase in values in 2023 compared to the previous year. This rise in value can be attributed to the cheap cost of passenger-to-freighter (P2F) conversions available for the type, coupled with the OEM facing little competition in the turboprop market - the only other viable option being the older DHC8-Q400.
https://www.iba.aero/insight/regional-a ... mance-2023
The interest in the ATR72-600 aircraft type has surged over the last year, especially among airlines in search of capacity to meet the current market demand. This has led to many existing operators opting not to return their aircraft at lease maturity and instead choosing to extend leases at higher Lease Rates.
Avation Related News
SkyExpress
Operating lessor Abelo has completed lease agreements for the first two of 20 ATR 72-600s under its orderbook. The aircraft will be leased to Greek carrier SkyExpress. The first aircraft was delivered on 15 January, while the second unit is anticipated to be delivered by March. Abelo is also the launch customer of the new STOL variant of the ATR42 model and has an orderbook for 10 units. SkyExpress has two ATR72-500s and seven ATR72-600s in its fleet along with five ATR42-500s.
Binter Canarias
Nordic Aviation Capital has confirmed a lease agreement for one ATR72-600 with Binter Canarias. The Spanish carrier operates a fleet of 19 ATR72-600s and four ATR72-500s.
Pelita Air
Indonesian carrier Pelita Air is looking to lease in up to 15 additional Airbus A320 aircraft this year as its proposed merger with Garuda’s budget offshoot Citilink awaits approval. It's Citilink subsidiary has 66 A320, A320neo, A330neo and ATR72-600s in its fleet.
I used to work with Pelita Air around 2002-4. They started out as a contract airline for the O&G industry. As a result they were very competent.
Cebu Pacific
Filipino carrier Cebu Pacific has agreed to lease a pair of ATR72-600s from Nordic Aviation Capital (NAC) for regional subsidiary Cebgo. Cebu Pacific's Cebgo turboprop fleet incudes 21 ATR72s and five ATR72-500s in storage
Loan Notes - A roundup
Aircastle has priced a new set of 5.95%, $650m senior notes due 2029 at an issue price of 99.391%
Other recent lessor offerings priced a little lower although still in a similar range, including Avolon’s $1.15 billion 5.75% senior notes due 2029
BOC Aviation’s $500million senior 2029 notes with a coupon of 5% and all-in yield of 5.25%;as well as Aercap’s $800m, 5.1% senior notes due 2029.
In contrast, Griffin Global AssetManagement earlier this month expanded its existing $400m 8% senior unsecured notes due 2027 with an additional $300m of senior unsecured notes. The upsized bond will carry the same coupon of 8% per annum, but the additional $300m of new notes were priced at 101 to yield 7.636% per annum.
Earlier this month, Aircastle amended of one of its unsecured revolving credit facilities, expanding the size of the facility that matures on 24 May 2025 to $375m from $245m during the nine months ended 30 November 2023.
Adjusted Return on Equity
Net Spread
Video Interview
An anemic interviewer asking, yet again, the wrong/inappropriate/amateurish questions. Might have been more informative to ask about the weather. I just put the link here for reference but cannot recommend anyone viewing it.
Random News
Ransomware
Aercap (2000+ aircraft lessor) confirmed a cyber incident related to ransomware on 17 January.
Aercap says its investigation into this incident, including the extent to which data may have been exfiltrated or otherwise impacted, remains ongoing. Aercap reportedly faced a 29 January deadline to reach an agreement with a new cyber threat group before it released data allegedly belonging to the NYSE-listed company.
Air Travel
The International Air Transport Association (IATA) has released data for November 2023 air travel performance, indicating that air travel demand topped 99% of 2019 levels. Asia-Pacific capacity rose 58% and the load factor was up 2.9 percentage points to 82.6%.
Research by Airfinance Journal has shown the depths to which airline ratings fell during the pandemic, which ravaged airline profitability, liquidity and balance sheets. The airline industry was, on average, rated a consensus BB before the pandemic, with the index weighted by the size of the airline, but this fell to CCC+ in the depths of the crisis in 2020-21.
ATR
The top performer in the turboprop segment is the ATR72-600, which has seen an average 8% increase in values in 2023 compared to the previous year. This rise in value can be attributed to the cheap cost of passenger-to-freighter (P2F) conversions available for the type, coupled with the OEM facing little competition in the turboprop market - the only other viable option being the older DHC8-Q400.
https://www.iba.aero/insight/regional-a ... mance-2023
The interest in the ATR72-600 aircraft type has surged over the last year, especially among airlines in search of capacity to meet the current market demand. This has led to many existing operators opting not to return their aircraft at lease maturity and instead choosing to extend leases at higher Lease Rates.
Avation Related News
SkyExpress
Operating lessor Abelo has completed lease agreements for the first two of 20 ATR 72-600s under its orderbook. The aircraft will be leased to Greek carrier SkyExpress. The first aircraft was delivered on 15 January, while the second unit is anticipated to be delivered by March. Abelo is also the launch customer of the new STOL variant of the ATR42 model and has an orderbook for 10 units. SkyExpress has two ATR72-500s and seven ATR72-600s in its fleet along with five ATR42-500s.
Binter Canarias
Nordic Aviation Capital has confirmed a lease agreement for one ATR72-600 with Binter Canarias. The Spanish carrier operates a fleet of 19 ATR72-600s and four ATR72-500s.
Pelita Air
Indonesian carrier Pelita Air is looking to lease in up to 15 additional Airbus A320 aircraft this year as its proposed merger with Garuda’s budget offshoot Citilink awaits approval. It's Citilink subsidiary has 66 A320, A320neo, A330neo and ATR72-600s in its fleet.
I used to work with Pelita Air around 2002-4. They started out as a contract airline for the O&G industry. As a result they were very competent.
Cebu Pacific
Filipino carrier Cebu Pacific has agreed to lease a pair of ATR72-600s from Nordic Aviation Capital (NAC) for regional subsidiary Cebgo. Cebu Pacific's Cebgo turboprop fleet incudes 21 ATR72s and five ATR72-500s in storage
Loan Notes - A roundup
Aircastle has priced a new set of 5.95%, $650m senior notes due 2029 at an issue price of 99.391%
Other recent lessor offerings priced a little lower although still in a similar range, including Avolon’s $1.15 billion 5.75% senior notes due 2029
BOC Aviation’s $500million senior 2029 notes with a coupon of 5% and all-in yield of 5.25%;as well as Aercap’s $800m, 5.1% senior notes due 2029.
In contrast, Griffin Global AssetManagement earlier this month expanded its existing $400m 8% senior unsecured notes due 2027 with an additional $300m of senior unsecured notes. The upsized bond will carry the same coupon of 8% per annum, but the additional $300m of new notes were priced at 101 to yield 7.636% per annum.
Earlier this month, Aircastle amended of one of its unsecured revolving credit facilities, expanding the size of the facility that matures on 24 May 2025 to $375m from $245m during the nine months ended 30 November 2023.