9 August 2024
AMEDEO
AIR FOUR PLUS LIMITED (the "Company")
(LSE: AA4, LEI: 21380056PDNOTWERG107)
Factsheet
The Company announces that its factsheet for the period to 30 June 2024 is
now available on its website at http://www.aa4plus.gg. An
extract from the Chairman's statement within the factsheet is
reproduced below.
The past year has seen rapid changes
in the aviation industry with strong airline performances from our
two lessees, Emirates and Thai Airways, as passenger traffic
continues to improve. Boeing's travails are front page news, less
so are the continuing labour and parts supply issues which are
hindering efforts by equipment manufacturers to fill the supply gap
left by COVID shutdowns. Whilst some airlines are still paying off
government financial support from 2020, others are placing large
orders for new generation aircraft. There is increasing evidence
that cost pressures, notably fuel and staff costs, are causing
excess capacity in some areas.
Your Company continues to show
strong financial performance with the cash flows from Emirates
supporting the dividend payments to Shareholders. Whilst the lease
rentals from Thai do not provide dividend income to the Company,
nevertheless, due to the lower interest rates achieved by the
existence of highly favourable derivatives, they act to reduce
outstanding debt.
The recent news that Emirates
intends to upgrade all its A380 aircraft which do not currently
have Premium Economy seats should be supportive of values
especially since doubts continue over the entry into service date
of the largest available replacement, the Boeing 777X. Emirates
financial results were outstanding and the A380's biggest
supporter, Sir Tim Clark is at the time of writing still at the
helm. However, the residual value of the Group's Assets is
key to the value of the Group to shareholders. The only empirical
evidence of value lies in the transactions by other investment
funds that have reached maturity where sales have been concluded to
Emirates. Recent news concerning progress made by Boeing with the
777X, further increases the uncertainty surrounding the future of
the A380 and so your Board remains of the view that these
transactions are not persuasive.
Thai Airways has placed a large
order for new Boeing aircraft and remains on track to emerge from
rehabilitation in 2025 with reduced debt, increased capital and a
slimmed down workforce.
To provide an update on our review
of strategic options available to the Company, I hope investors
will not mistake our comparative silence on this topic as lack of
effort. A great deal of work is being done in assessing the best
way forward, with a number of different industry participants and
advisers including our asset manager, Amedeo Limited.
Whilst the Group's fleet is not the
most complex, it is not the simplest, either. One of our aircraft
types, the A380, is less liquid given the shallow operator base
although the good news flow I refer to above should support
stronger valuations. In addition, one of our lessees is still
under bankruptcy protection, and this is discouraging to investors.
Consequently, in weighing up the possible alternative ways forward
- including running off the leases as is or selling the whole or a
part of the portfolio now or over time - in terms of value to you,
our shareholders, is not straightforward. Your Board remains
committed to identifying the best value for you overall, including
assessing the return of cash to you, as we consider prudent, along
the way. We intend to provide an update to Shareholders later this
year.
Finally, I would like to take the
opportunity to thank our two outgoing Directors, Laurence Barron
and Mary Gavigan, for their diligence and commitment during their
time in office. We welcome Eithne Manning whose deep leasing
industry experience will be relevant in our ongoing
review.
Robin Hallam
For further information, please
contact:
JTC Fund Solutions (Guernsey)
Limited
+44 (0) 1481 702 400
Panmure Liberum Limited
Chris Clarke / Darren
Vickers
+44 (0) 20 3100 2000
About the Company
The Company is a Guernsey-domiciled
company, with shares admitted to trading on the Specialist Fund
Segment of the London Stock Exchange's Main Market (LSE:
AA4).
The Company's investment objective
is to obtain income returns and a capital return for its
Shareholders by acquiring, leasing and then selling
aircraft.
