ALLIANCE Aviation Services’ underlying profit before tax is expected to exceed its previous 2023 fiscal year guidance of $50-55 million, the company has confirmed.
The Brisbane-based airline is expecting its underlying 2023 fiscal year net profit before tax to total $56.9 million, which will be confirmed in its full FY23 results, due post the close of markets on 09 August.
Alliance’s flying activity has increased in the second half of the fiscal year, as it predicted in its first half results presentation, in line with the deployment of additional aircraft into service under contracted wet lease arrangements.
In response, Alliance has entered into a contract to acquire an additional four Embraer E190 airframes from Azorra Aircraft Holdings, having identified a capacity shortfall in the first quarter of 2024.
The airframes will be delivered to Alliance in Costa Rica, without their engines fitted, starting next month, with the company to use spare engines to bring them into operation between November and March.
The shortage is due to an increase in demand, contractual commitments, fleet logistics, and the timing of Alliance’s previously announced acquisition of 30 additional E190 jet aircraft from AerCap Ireland Limited, which are scheduled to be delivered from September 2023-January 2026.
Alliance has also renewed its contract with Incitec Pivot Limited for a further five years for the provision of eight weekly air services between Townsville and the company’s mine operations at Phosphate Hill in Queensland’s Gulf Country.
When the renewed contract reaches expiry, Alliance will have supplied air services to the town on a continuous basis for 27 years.
“We have retained this contract through the various early ownership changes of the mine and most recently under the long-term ownership of IPL,” Alliance Managing Director Scott McMillan observed.
“The long tenure of this contract is attributable to our superior operational capability, which is focused on delivering safe, reliable and on time services.
“Longevity of customer relationships based upon the high standards we provide is the cornerstone of our success in the FIFO sector”.
Alliance also announced it has entered into a US$100 million debt facility with Pricoa Private Capital, which allows for the issuance of AUD and USD notes over three years, in maturities of up to 10 years.
The facility was concluded during the second half of this financial year, and is available to be drawn down to fund future aircraft settlements and working capital requirements.