Tuesday 21 November 2017

Pay to 11 high-fliers at Dublin-based lessor soars 160pc to €24.3m

Operating profits increased from €568m to €599m last year
Operating profits increased from €568m to €599m last year

Gordon Deegan

Eleven directors at Dublin-based aircraft leasing firm AWAS Aviation Capital last year shared a pay-pot of $27.3m (€24.3m).

The soaring pay to the directors at the aircraft leasing firm coincided with revenues increasing by 3pc to top $1.2bn.

Eleven directors served on the board during the year, including six Irish residents who enjoyed the soaring pay as aggregate pay increased from $10.4m to $27.34m, which works out at $2.48m each on average.

The directors enjoyed the increased pay as operating profits last year went up from $568.53m to $599.87m.

However, finance expenses of $6109m resulted in the firm recording a pre-tax loss of $9.5m.

This compares to a pre-tax profit of $221.97 in 2014.

The firm last year returned $912.3m to its shareholder through a combination of $631m in dividends and repayment of $280m in a shareholder's loan.

AWAS moved its HQ to Ireland in 2006 following Terra Firma, run by financier Guy Hands, buying 75pc of the firm for $2.5bn.

Earlier this year, AWAS was the subject of takeover speculation after it was reported that Terra Firma rejected two bids worth up to $2.2bn from Chinese firm Bohai Leasing which completed the purchase of another Dublin aircraft leasing firm, Avolon in January.

During last year, the ceo of AWAS Capital, Raymond Sisson, left the firm and has been replaced by David Siegel. Two other directors also resigned from the board last year.

According to the directors' report, "during the year, there was strong revenue growth driven by aircraft deliveries, gain on disposal of aircraft, lower depreciation and amortisation".

The firm's main growth came from the Asia/Pacific region last year where revenues increased from $544.67m to $570.96m. The Asia Pacific business accounted for 47pc of business while Europe accounted for 22pc or $266.36m of revenues.

The directors state that the downturn in profits last year "was predominantly due to acceleration of internal interest of $249.8m related to the repayment of certain shareholder loans, which nets in equity".

The firm's cash pile at the end of November last year totalled $695m and total assets amounted to $9.5bn.

Numbers employed by the firm last year fell from 130 to 120 but staff costs rose from $56.2m to $66.4m.

That includes $36m in salaries and wages and $24.8m in long term employment benefits and share-based payments.

The amount that the firm spent on legal and professional fees last year soared from $18m to $29.9m while its travel expenses fell from $4.6m to $3.4m. The operating profit last year takes account of large non-cash depreciation costs of $376.52m and property impairment of $36.6m.

At the end of November last, the group owned 257 aircraft including 50 aircraft held for sale.

During last year, the firm sold 88 aircraft and purchased 31.

A note attached to the accounts states that one member of the firm's key management personnel last year left the business and was entitled to a payment of $700,000.

Ireland is the centre of the world's aircraft leasing industry with nine of the top 10 firms based here. The industry grew from Tony Ryan establishing GPA in Shannon in the 1980s.

Irish Independent

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