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    Half-year Financial Report

    Picture of Avation logoAvation
    26/02/2026 07:50
    RNS Number : 5209U

Avation PLC

26 February 2026

 

AVATION PLC

("Avation" or "the Company")

 

UNAUDITED Results for the SIX MONTHS ended 31 December 2025

Avation PLC (LSE: AVAP), the commercial passenger aircraft leasing company, announces unaudited results for the six months ended 31 December 2025.

 

Financial Highlights

 

·    Revenue and other income increased to US$56.0 million (2024: US$55.4 million);

·    Operating profit increased to US$29.3 million (2024: US$18.8 million);

·    Total cash was US$104.8 million (30 June 2025: US$130.0 million) after paying cash for a new ATR 72-600 in December 2025;

·    Ten aircraft unencumbered at 31 December 2025 (30 June 2025: six);

·    Net indebtedness reduced by US$61.5 million to US$542.7 million (30 June 2025: US$604.2 million), representing 54.7% of total assets (30 June 2025: 54.8%);

·    In November 2025 Avation Group (S) Pte Ltd issued US$300 million 8.5% unsecured notes due May 2031.  The proceeds were used to fully redeem the group's outstanding 8.25% unsecured notes due 2026;

·    Ratio of net debt to EBITDA improved to 5.1x (30 June 2025: 5.6x); and

·    Net asset value per share increased by 2.6% to £2.74 (30 June 2025: £2.67).

 

Operational Highlights

 

·    In October 2025 the Company agreed a four-year extension to a lease for an Airbus A330-300 widebody aircraft with EVA Air.  The lease will now run to November 2031;

·    In August 2025 Avation sold a Boeing 777-300ER widebody aircraft realising a gain of US$4.1 million;

·    In December 2025 Avation took delivery of a new ATR 72-600 which has been placed on a 12-year lease to Korean airline Sum Air; and

·    Two ATR 72-600 aircraft have recently been transitioned to new 6-year leases with existing customers PNG Air and Clic Air. A third ATR 72-600 aircraft is due to transition to a new 6-year lease with a Croatian airline in March.

 

Overview

Avation PLC is a commercial passenger aircraft leasing company focused on the acquisition, leasing and management of modern, fuel-efficient commercial aircraft. The Company's strategy is to generate stable long-term cash flows through secured lease contracts with airline counterparties globally, supported by disciplined capital management.

The Company derives the majority of its income from fixed-rate operating lease rentals and associated maintenance reserve contributions.

Avation continued to focus on:

·      Maintaining high fleet utilisation;

·      Securing long-term lease agreements with creditworthy counterparties;

·      Active asset management and remarketing;

·      Strengthening the balance sheet through refinancing and maturity extension; and

·      Identifying opportunities to acquire new and used aircraft to grow the portfolio.

This report should be read in conjunction with the Company's Annual Report and Audited Financial Statements for the year ended 30 June 2025.

Market

According to IATA, in 2025 global passenger traffic grew 5.3% year-on-year. Both domestic and international passenger traffic growth moderated in 2025. Domestic traffic increased by 2.4% year-on-year, while international traffic expanded by 7.1%. Passenger load factors increased to 83.6%, the highest on record for any year. Continued growth in the overall air travel market is supportive for commercial aircraft leasing.

Fleet and Leasing Activity

The number of aircraft in Avation's fleet is unchanged since 30 June 2025 at 33 aircraft following the sale of a Boeing 777-300ER in August 2025 and delivery of a new ATR 72-600 aircraft in December 2025.  The fleet is set to grow through nine further deliveries of ATR 72-600 aircraft on order from the manufacturer. The nine ordered aircraft are scheduled for delivery between the second quarter of this year and the second quarter of 2028.

The first of these nine aircraft is scheduled for delivery in April 2026 and will be placed on lease to Cambodia Airways for 12 years.  A second aircraft, scheduled for delivery later this year, has also been placed with Cambodia Airways on a 12-year lease.  A total of four new aircraft deliveries are expected this year, based on the manufacturer's current production schedule.

Avation was pleased to conclude a four-year extension to the lease of its remaining widebody aircraft in October. This extension, which was agreed more than two years ahead of the scheduled expiry of the lease, is an indicator of the continued strong demand for leased aircraft.

Two ATR 72-600 aircraft have been transitioned to new lessees recently following the expiry of their lease to Mandarin Airlines.  A third aircraft will be transitioned to a new lessee in March.  Avation has one additional ATR 72-600 aircraft coming off lease in May and is currently in discussion with prospective new lessees for the aircraft.

Avation's customer for two ATR 72-600 aircraft Braathens Regional Airways AB entered administration in October 2025 and the Company has terminated the leases for both aircraft.  The aircraft were both redelivered to Avation recently and the Company is currently seeking replacement lessees.  The Company is still evaluating the financial impacts, if any, of the termination of the leases to Braathens.

Avation was recently notified that following a technical failure, one of its Airbus A220-300 aircraft on lease to Air Baltic has been classified as unrepairable and is deemed to be a total loss. Avation will receive an insurance claim settlement of US$33.4 million as compensation for loss of the aircraft which is in line with its book value.  It is expected that the claim settlement will be paid shortly.

Capital Structure and Financing

The Company was pleased to close the issuance of US$300 million 8.5% unsecured notes due May 2031 in November 2025 ("Notes").  The new Notes, which represent just over 50% of Avation's total debt, provide the Company with a stable long-term capital structure, support operational stability, and remove the near-term refinancing risk inherent in the group's previous note issue which was due to mature In October 2026.

The Notes are rated B by Fitch Ratings, B2 by Moody's and B by S&P Global Ratings. The rating agencies also provide corporate ratings for Avation of B (outlook stable), B1 (outlook stable) and B (outlook stable) respectively.

During the period the Company repurchased 5,181,996 ordinary shares at an average price of 147 pence per share and issued a total of 890,978 shares pursuant to exercises of employee and bondholder warrants.  As a result of these actions the number of shares in issue less treasury shares has been reduced by 6.4% from 66,588,737 at 30 June 2025 to 62,297,739 at 31 December 2025.

The Company paid an interim dividend of 1.0 US cents per share in respect of the financial year ended 30 June 2025 in October 2025.

The Group continues to manage leverage levels prudently, with a focus on maintaining adequate headroom under debt facilities and compliance with financial covenants.

Executive Chairman, Jeff Chatfield, said:

"We are pleased to present these results for the six-month period ended 31 December 2025 which show continued stable cash flow generation from a fully utilised fleet with ten unencumbered aircraft. 

We are particularly pleased to report the successful refinancing of our near-term unsecured debt obligations with a new long-dated issue of US$300 million unsecured Notes in November 2025.  The extended maturity for the new Notes creates stability in our capital structure and provides a platform for future fleet growth.

The result for the period includes the final expenses recorded in relation to amortisation of the 2021 accounting gain on modification of the terms of our previous bond issue and the full redemption of the bonds in November 2025.  These non-cash expenses, totalling US$13.0 million, are non-recurring and stripping their impact from our half-year results reveals the underlying strength of the Company's financial performance.

Demand for passenger air travel continues to grow steadily and long OEM order backlogs, supply chain issues and delays to new aircraft deliveries are all supportive for aircraft lessors such as Avation.  These factors have contributed to increased demand for lease extensions, which is notably illustrated by our agreement of a four-year lease extension with EVA Air for an Airbus A330-300 widebody aircraft in October 2025.  This extension was negotiated over two years ahead of the scheduled expiry date for the lease.

Avation enters the second half of the financial year with a contracted lease portfolio providing visibility of cash flows, extended debt maturities following the successful refinancing of our unsecured debt obligations and continued demand for leased aircraft amid constrained new aircraft supply.

Management remains focused on portfolio optimisation, disciplined capital allocation and maintaining financial flexibility.

The Board believes that the Company is well positioned to navigate prevailing market conditions while continuing to generate long-term shareholder value."

Financial Summary


    US$ '000sSix months ended 31 December,
    20252024
    Revenue55,54752,980
    Other income4542,468
    56,00155,448
    EBITDA(1)54,02755,553
    Operating profit29,25818,816
    Profit/(loss) before tax(5,681)(9,769)
    Profit/(loss) after tax(4,901)868
    EPS(7.56c)1.23c
    US$ '000s31 December 202530 June
    2025
    Fleet assets(2)744,836819,807
    Total assets992,5121,101,935
    Cash and bank balances(3)104,788129,975
    Unrestricted cash and cash equivalents46,00448,102
    Net asset value per share (US$)(4)$3.70$3.66
    Net asset value per share (GBP)(5)£2.74£2.67
    

 

1.   EBITDA is a non-GAAP financial measure used as an indicator of a company's ability to incur and service debt. EBITDA has been calculated as the sum of profit before tax, finance expenses, depreciation and impairment and unrealised losses on aircraft purchase rights and deposits paid for aircraft. EBITDA presented herein may not be comparable to similarly titled measures presented by other companies.

2.   Fleet assets are defined as property, plant and equipment plus assets held for sale plus finance lease receivables.

3.   Cash and bank balances as at 31 December 2025 comprise cash and cash equivalents of US$46.0 million (30 June 2025: US$48.1 million), restricted cash balances of US$58.8 million (30 June 2025: US$80.8 million) and investment in fixed term deposits US$nil (30 June 2025: US$1.0 million).

4.   Net asset value per share is total equity divided by the total number of shares in issue, excluding treasury shares.

5.   Based on GBP:USD exchange rate as at 31 December 2025 of 1.35 (30 June 2025:1.37).

Aircraft Fleet


    Aircraft Type31 December 202530 June 2025
    Boeing 777-300ER-1
    Airbus A330-30011
    Airbus A321-20066
    Airbus A320-20033
    Airbus A220-30055
    ATR 72-6001413
    ATR 72-50044
    Total3333
    

At 31 December 2025, Avation's fleet comprised 33 aircraft, including three aircraft on finance lease. Avation currently serves 16 customers in 15 countries. The weighted average age of the fleet is 8.8 years (30 June 2025: 8.5 years) and the weighted average remaining lease term is 4.3 years (30 June 2025: 3.9 years).

Avation sold a Boeing 777-300ER widebody aircraft during the period generating a gain on sale of US$4.1 million. The Company also acquired a new ATR 72-600 turboprop aircraft in late December which has been placed on a 12-year fixed rate lease agreement with an airline in Korea. Avation's fleet comprises 61% narrowbody, 31% turboprop and 8% widebody aircraft by book value as at 31 December 2025. Fleet assets have decreased 9.1% to US$744.8 million (30 June 2025: US$819.8 million) principally due to the Boeing 777-300ER sale noted above. During the six months ended 31 December 2025 all aircraft were on lease. 

Avation has nine new ATR 72-600 aircraft on order for delivery between Q2 2026 and Q2 2028 and purchase rights for a further 24 aircraft as at 31 December 2025.

Debt summary


    US$ '000s31 December 202530 June
    2025
    Current loans and borrowings45,63870,084
    Non-current loans and borrowings543,086582,253
    Total loans and borrowings588,724652,337
    Unrestricted cash and bank balances46,00448,102
    Net indebtedness(1)542,720604,235
    Net debt to total assets54.7%54.8%
    Net debt to EBITDA5.1x5.6x
    Weighted average cost of secured debt(2)5.1%5.2%
    Weighted average cost of total debt(3)6.8%6.6%
    

 

1.   Net indebtedness is defined as loans and borrowings less unrestricted cash and bank balances.

2.   Weighted average cost of secured debt is the weighted average interest rate for secured loans and borrowings at period end.

3.   Weighted average cost of total debt is the weighted average interest rate for total loans and borrowings at period end.

Net indebtedness was reduced by 10.2% to US$542.7 million (30 June 2025: US$604.2 million).

The weighted average cost of total debt has increased to 6.8% at 31 December 2025 (30 June 2025: 6.6%) largely due to an increase in the Company's unsecured debt coupon from 8.25% to 8.50% following the successful issue of US$300 million unsecured notes due May 2031 in November 2025. The weighted average cost of secured debt decreased to 5.1% at 31 December 2025 (30 June 2025: 5.2%).

At the end of the period, Avation's net debt to total assets ratio improved slightly to 54.7% (30 June 2025: 54.8%). At 31 December 2025, 84.0% of total debt was at fixed or hedged interest rates (30 June 2025: 84.2%). The ratio of unsecured debt to total debt was 50.1% (30 June 2025: 45.3%).

Financial Analysis

Revenue


    US$ '000sSix months ended 31 December,
    20252024
    Lease rental revenue44,10844,558
    Less: amortisation of lease incentive assets(1,540)(1,628)
    42,56842,930
    Interest income from finance leases420780
    Maintenance reserves revenue10,2999,270
    End of lease compensation2,260-
    55,54752,980
    

 

Lease rental revenue decreased by 1.0% from US$44.6 million in the six months ended 31 December 2024 to US$44.1 million in the six months ended 31 December 2025. The decrease was principally due to the sale of a Boeing 777-300ER aircraft in August 2025 partially offset by an increase in the US dollar equivalent value of the Company's Euro-denominated lease revenue. All of Avation's aircraft were on-lease throughout the period.

Interest income from finance leases decreased by 46.2% from US$0.8 million in the six months ended 31 December 2024 to US$0.4 million in the six months ended 31 December 2025. The reduction was principally due to fewer aircraft on average leased on finance leases during the six months ended 31 December 2025. There were three aircraft leased on finance leases at 31 December 2025.

Other income


    US$ '000sSix months ended 31 December,
    20252024
    Fees for late payment269753
    Foreign currency exchange gain-1,002
    Claim recovery-442
    Others185271
    4542,468
    

 

Fees charged for late payments reduced by 64.3% from US$0.8 million in the six months ended 31 December 2024 to US$0.3 million in the six months ended 31 December 2025. The reduction is due to reduced levels of arrears throughout the period.

Claim recoveries recognised in other income in the six months ended 31 December 2024 are distributions paid to creditors of Virgin Australia in excess of amounts allocated to trade receivables.

Foreign currency exchange gains in the six months ended 31 December 2024 arose principally from the revaluation of Euro-denominated loans during the period.

Administrative expenses


    US$ '000sSix months ended 31 December,
    20252024
    Staff costs3,0552,875
    Other administrative expenses2,5511,725
    5,6064,600
    

 

Staff costs increased by 6.8% from US$2.9 million in the six months ended 31 December 2024 to US$3.1 million in the six months ended 31 December 2025 principally as a result of inflationary salary increments.

Other administrative expenses increased by 47.9% from US$1.7 million in the six months ended 31 December 2024 to US$2.6 million in the six months ended 31 December 2025.  The increase in the six months ended 31 December 2025 was principally due to additional audit and accounting fees of US$0.4 million associated with the update of the Company's GMTN programme documentation and US$0.2 million of fees paid to retained contractors for commercial marketing services.

 

 

Finance income


    US$ '000sSix months ended 31 December,
    20252024
    Interest income2,1162,752
    Fair value gain on financial derivatives--
    Finance income from discounting non-current deposits to fair value317315
    Gain on early full repayment of borrowings-1,084
    2,4334,151
    

 

Interest income was US$2.1 million in the six months ended 31 December 2025. Interest income includes distributions from investments in money-market funds. The group deploys surplus cash balances into fixed term deposits and money-market funds while maintaining sufficient liquidity to meet near-term payment obligations.

A gain of US$1.1 million on early full repayment of borrowings arose when in-the-money interest rate swaps were terminated concurrently with repayment of two loans on the sales of aircraft in August 2024.

Finance expenses


    US$ '000sSix months ended 31 December,
    20252024
    Amortisation of IFRS 9 gain on debt modification4,1887,440
    Interest expense on secured borrowings8,1398,447
    Interest expense on unsecured notes12,47713,677
    Amortisation of loan transaction costs575699
    Amortisation of interest expense on non-current borrowings324314
    Loss on repurchases and redemption of unsecured notes8,790-
    Fair value loss on financial derivatives2,8002,002
    Others79157
    33,18425,296
    

 

Amortisation of IFRS 9 gain on debt modification of US$4.2 million represents the non-cash accretion in the book value of Avation Capital S.A. 8.25%/9.0% unsecured notes resulting from the accounting treatment of the extension and changes to the terms of the notes agreed with noteholders in March 2021. The extension was accounted for as a substantial modification of a debt instrument in accordance with IFRS 9.

Avation Capital S.A. 8.25%/9.0% unsecured notes were fully redeemed in November 2025.  The Company has recognised a loss of US$8.8 million on the redemption of these notes to write off the difference between the accreted value of the notes and the amount paid on redemption.

Interest expense on secured borrowings reduced by 3.6% to US$8.1 million in the six months ended 31 December 2025 from US$8.4 million in the six months ended 31 December 2024 as a result of repayments of secured loans. Secured loans have been reduced by US$34.9 million from US$328.7 million at 31 December 2024 to US$293.8 million at 31 December 2025.

Interest expense on unsecured notes reduced by 8.8% from US$13.7 million in the six months ended 31 December 2024 to $12.5 million in the six months ended 31 December 2025. The reduction principally results from repurchases of notes which reduced the average outstanding principal amount.

A non-cash mark-to-market loss of US$2.8 million arose on the revaluation of interest rate swap agreements as a result of changes in floating interest rates in the six months ended 31 December 2025.

Results Conference Call

Avation's senior management team will host an investor update call on 26 February 2026, at 12:00 PM GMT (UK) / 7:00 AM EST (US) / 8:00 PM SGT (Singapore), to discuss the Company's financial results.

 

A replay of the investor update call will be made available on the Investor Relations page of the Avation PLC website.

Forward Looking Statements

This release contains certain "forward looking statements". Forward looking statements may be identified by words such as "expects," "intends," "initiate", "anticipates," "plans," "believes," "seeks," "estimates," "will," or words of similar meaning and include, but are not limited to, statements regarding the outlook for Avation's future business and financial performance. Forward looking statements are based on management's current expectations and assumptions, which are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Actual outcomes and results may differ materially due to global political, economic, business, competitive, market, regulatory and other factors and risks. Further information on the factors and risks that may affect Avation's business is included in Avation's regulatory announcements from time to time, including its Annual Report, Full Year Financial Results and Half Year Results announcements. Avation expressly disclaims any obligation to update or revise any of these forward-looking statements, whether because of future events, new information, a change in its views or expectations, or otherwise.

Basis of presentation

This announcement covers the unaudited results of Avation PLC for the six months ended 31 December 2025.

Financial information presented in this announcement is being published for the purposes of providing preliminary Group financial results for the six months ended 31 December 2025. The financial information in this preliminary announcement is not audited and does not constitute statutory financial statements of Avation PLC within the meaning of section 434 of the Companies Act 2006. The Board of Directors approved this financial information on 25 February 2026. Avation PLC's most recent statutory financial statements for the purposes of Chapter 7 of Part 15 of the Companies Act 2006 for the year ended 30 June 2025, upon which the auditors have given an unqualified audit, were published on 1 October 2025 and have been annexed to the annual return and delivered to the Registrar of Companies.

All "US$" amounts in this release are US Dollar amounts unless stated otherwise. Certain comparative amounts have been reclassified to conform with current year presentation.

 

 

Enquiries:

Avation PLC - Jeff Chatfield, Executive Chairman                                      +65 6252 2077

Avation welcomes shareholder questions and comments and advises the email address is: investor@avation.net

 

More information on Avation is available at www.avation.net.

AVATION PLC

CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025


    Note31 Dec
    2025    		31 Dec
    2024
    US$'000sUS$'000s
    Continuing operations
    Revenue555,54752,980
    Other income64542,468
    56,00155,448
    Depreciation11(18,102)(18,599)
    Gain on disposal of aircraft4,1451,713
    Unrealised loss on aircraft purchase rights and pre-delivery aircraft deposits paid16,17(4,234)(15,389)
    Unrealised loss on equity investment18(1,093)(124)
    Reversal of impairment loss on aircraft11-1,402
    Aircraft transition expenses(50)(180)
    (Provision for)/reversal of expected credit losses(54)85
    Administrative expenses(5,606)(4,600)
    Legal and professional fees(1,640)(940)
    Other expenses7(109)-
    Operating profit29,25818,816
    Finance income82,4334,151
    Amortisation of IFRS 9 gain on debt modification of the unsecured notes(4,188)(7,440)
    Finance expenses9(33,184)(25,296)
    Loss before taxation(5,681)(9,769)
    Taxation78010,637
    (Loss)/profit from continuing operations(4,901)868
    (Loss)/profit attributable to:
    Shareholders of Avation PLC(4,901)868
    Non-controlling interests--
    (4,901)868
    Earnings per share for (loss)/profit
    attributable to shareholders of Avation PLC
    Basic earnings per share (US cents)(7.56)1.23
    Diluted earnings per share (US cents)(7.36)1.18
    

 

 

 

 

 

 

 

AVATION PLC

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025


    31 Dec
    2025    		31 Dec
    2024
    US$'000sUS$'000s
    (Loss)/profit from continuing operations(4,901)868
    Other comprehensive loss:
    Items may be reclassified subsequently to profit or loss:
    Net profit/(loss) on cash flow hedge, net of tax1,468(2,003)
    1,468(2,003)
    Items may be reclassified subsequently to profit or loss:
    Revaluation loss on property, plant and equipment, net of tax-(561)
    Other comprehensive loss, net of tax(3,433)(2,564)
    Total comprehensive loss for the period(3,433)(1,696)
    Total comprehensive loss attributable to:
    Shareholders of Avation PLC(3,433)(1,696)
    Non-controlling interests--
    (3,433)(1,696)
    

 

 

 

 

AVATION PLC

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2025


    Note31 Dec
    2025    		30 Jun
    2025
    ASSETSUS$'000sUS$'000s
    Non-current assets
    Property, plant and equipment11732,665725,134
    Finance lease receivables133,54611,129
    Trade and other receivables128201,005
    Pre-delivery aircraft deposits paid1613,08618,218
    Derivative financial assets15393836
    Aircraft purchase rights1786,05091,740
    Lease incentive assets3,3194,831
    Goodwill141,9021,902
    841,781854,795
    Current assets
    Finance lease receivables138,6251,734
    Trade and other receivables1211,9529,912
    Pre-delivery aircraft deposits paid1614,44310,960
    Derivative financial assets9714
    Investment in equity, fair value through profit or loss188,0229,115
    Lease incentive assets2,8922,920
    Restricted cash58,78480,831
    Cash investment in fixed term bank deposits-1,042
    Cash and bank balances46,00448,102
    150,731165,330
    Assets held for sale-81,810
    150,731247,140
    Total assets992,5121,101,935
    EQUITY AND LIABILITIES
    Equity
    Share capital191,0981,234
    Share premium78,92479,447
    Treasury shares19(8,484)(16,003)
    Merger reserve6,7156,715
    Asset revaluation reserve62,15862,158
    Capital reserve8,8768,876
    Other reserves(206)(1,406)
    Retained earnings81,265102,818
    Equity attributable to shareholders of Avation PLC230,346243,839
    Non-controlling interests77
    Total equity230,353243,846
    Non-current liabilities
    Loans and borrowings20543,086582,253
    Trade and other payables19,99618,843
    Derivativefinancial liabilities153,0443,142
    Maintenance reserves2135,64631,360
    Deferred tax liabilities29,77531,637
    631,547667,235
    Current liabilities
    Loans and borrowings2045,63870,084
    Trade and other payables18,91119,595
    Maintenance reserves2163,19769,423
    Income tax payable2,8661,314
    130,612160,416
    Liabilities associated with assets held for sale-30,438
    130,612190,854
    Total equity and liabilities992,5121,101,935
    


    Attributable to shareholders of Avation PLC
    Share capitalShare
    premium    		Treasury
    Shares    		Merger reserveAsset revaluation reserveCapital reserveOther
    reserves    		Retained earningsTotalNon-controlling interestTotal
    equity
    US$'000sUS$'000sUS$'000sUS$'000sUS$'000sUS$'000sUS$'000sUS$'000sUS$'000sUS$'000sUS$'000s
    Balance at 1 July 20251,23479,447(16,003)6,71562,1588,876(1,406)102,818243,8397243,846
    Loss for the period-------(4,901)(4,901)-(4,901)
    Other comprehensive income------1,468-1,468-1,468
    Total comprehensive loss------1,468(4,901)(3,433)-(3,433)
    Issue of shares19185-----86-86
    Purchase of treasury shares19--(10,132)-----(10,132)-(10,132)
    Treasury shares re-issue-(608)1,648---(648)-392-392
    Cancellation of treasury shares(137)-16,003---137(16,003)---
    Share warrant expense------243-243-243
    Dividend paid24-------(649)(649)-(649)
    Total transactions with owners recognised directly in equity(136)(523)7,519---(268)(16,652)(10,060)-(10,060)
    Balance at 31 December 20251,09878,924(8,484)6,71562,1588,876(206)81,265230,3467230,353
    

AVATION PLC

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

    

 

 

Capital reserve comprises acquisitions with non-controlling interests that do not result in a change of control.

 

Other reserves consist of capital redemption reserve, share warrant reserve, fair value reserve and foreign currency hedge reserve.

 

The merger reserve arose on acquisition of additional shares of the Company's subsidiary Capital Lease Aviation Limited through the allotment of ordinary shares in the year ended 30 June 2015.  The merger reserve represents the difference between the fair value and the nominal value of the shares issued by the Company.

 

AVATION PLC

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE SIX MONTHS ENDED 31 DECEMBER 2024

 


    Attributable to shareholders of Avation PLC
    Share capitalShare
    premium    		Treasury
    Shares    		Merger reserveAsset revaluation reserveCapital reserveOther
    reserves    		Retained earningsTotalNon-controlling interestTotal
    equity
    US$'000sUS$'000sUS$'000sUS$'000sUS$'000sUS$'000sUS$'000sUS$'000sUS$'000sUS$'000sUS$'000s
    Balance at 1 July 20241,18270,120-6,71547,3438,87611,210110,944256,3907256,397
    Profit for the period-------868868-868
    Other comprehensive loss----(561)-(2,003)-(2,564)-(2,564)
    Total comprehensive loss----(561)-(2,003)868(1,696)-(1,696)
    Issue of shares19488,847----(2,753)-6,142-6,142
    Purchase of treasury shares19--(14,962)-----(14,962)-(14,962)
    Share warrant expense------222-222-222
    Dividend paid24-------(450)(450)-(450)
    Total transactions with owners recognised directly in equity488,847(14,962)---(2,531)(450)(9,048)-(9,048)
    Balance at 31 December 20241,23078,967(14,962)6,71546,7828,8766,676111,362245,6467245,653
    

 

 

AVATION PLC

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025


    Note31 Dec
    2025    		31 Dec
    2024
    US$'000sUS$'000s
    Cash flows from operating activities:
    Loss before taxation(5,681)(9,769)
    Adjustments for:
    Amortisation of lease incentive asset51,5401,628
    Depreciation expense1118,10218,599
    Depreciation of right-of-use assets144141
    Provision for/(reversal of) expected credit losses54(85)
    Finance income8(2,433)(4,151)
    Finance expense933,18425,296
    Amortisation of IFRS 9 gain on debt modification of the unsecured notes4,1887,440
    Gain on disposal of aircraft(4,145)(1,713)
    Interest income from finance lease5(420)(780)
    Reversal of impairment loss on aircraft11-(1,402)
    Maintenance reserves income5(10,299)(9,270)
    Share warrants expense243222
    Foreign currency exchange loss/(gain)74(1,231)
    Unrealised gain on aircraft purchase rights and pre-delivery aircraft deposits paid16,174,23415,389
    Unrealised loss on equity investments181,093124
    Operating cash flows before working capital changes39,87840,438
    Movement in working capital:
    Trade and other receivables and finance lease receivables(1,026)29,685
    Pre-delivery aircraft deposits paid(1,134)(4,536)
    Trade and other payables1,286806
    Maintenance reserves(22,079)5,438
    Cash from operations16,92571,831
    Finance income received2,7275,236
    Finance expense paid(20,787)(21,972)
    Income tax refund/paid98(514)
    Net cash (used in)/from operating activities(1,037)54,581
    Cash flows from investing activities:
    Cash investment in fixed term bank deposits1,042(39,274)
    Purchase of aircraft and aircraft engine(21,394)(15,682)
    Proceeds from disposal of aircraft85,81419,790
    Net cash from/(used in) investing activities65,462(35,166)
    Cash flows from financing activities:
    Net proceeds from issuance of ordinary shares866,142
    Purchase of treasury shares19(10,132)(14,962)
    Dividend paid24(649)(450)
    Decrease of restricted cash balances22,04740,217
    Proceeds from loans and borrowings, net of transactions costs302,141-
    Repayment of loans and borrowings(380,016)(41,747)
    Net cash used in financing activities(66,523)(10,800)
    Net (decrease)/increase in cash and cash equivalents(2,098)8,615
    Cash and cash equivalents at beginning of financial period48,10223,561
    Cash and cash equivalents at end of financial period46,00432,176
    

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

This interim condensed consolidated financial statements for Avation PLC for the six months ended 31 December 2025 were authorised for issue in accordance with a resolution of the Directors on 25 February 2026.

 

1          CORPORATE INFORMATION

 

Avation PLC is a public limited company incorporated in England and Wales under the Companies Act 2006 (Registration Number 05872328) and its shares are traded on the Standard Segment of the Main Market of the London Stock Exchange.

 

The Group's principal activity is aircraft leasing. 

 

 

2          BASIS OF PREPARATION AND ACCOUNTING POLICIES

 

These interim condensed consolidated financial statements have been prepared in accordance with the Disclosure and Transparency Rules (DTR) of the Financial Conduct Authority and in accordance with UK-adopted International Accounting Standard (IAS) 34 'Interim Financial Reporting'.

 

The interim condensed consolidated financial statements do not include all the notes of the type normally included within the annual report and therefore cannot be expected to provide as full an understanding of the financial performance, financial position and financial and investing activities of the consolidated entity as the annual report.

 

It is recommended that the interim condensed consolidated financial statements be read in conjunction with the annual report for the year ended 30 June 2025 and considered together with any public announcements made by Avation PLC during the six months ended 31 December 2025.

 

The accounting policies and methods of computation are the same as those adopted in the annual report for the year ended 30 June 2025.

 

The preparation of the interim condensed consolidated financial statements requires management to make estimates and assumptions that affect the reported income and expenses, assets and liabilities and disclosure of contingencies at the date of the Interim Report, actual results may differ from these estimates.

 

The statutory financial statements of Avation PLC for the year ended 30 June 2025, which carried an unqualified audit report, have been delivered to the Registrar of Companies and did not contain any statements under section 498 of the Companies Act 2006.

 

The interim condensed consolidated financial statements are unaudited.

 

The interim condensed consolidated financial statements do not constitute statutory financial statements within the meaning of section 434 of the Companies Act 2006.

 

 

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

3          NEW STANDARDS AND INTERPRETATIONS NOT APPLIED AND STANDARDS IN EFFECT IN 2026

 

(a)           New standards and interpretations not applied

 

The Group has not adopted the following new or amended standards and interpretations which are relevant to the Group that have been issued but are not yet effective:

(b)  


    DescriptionEffective date
    (period beginning)
    Amendments to IFRS 9 and IFRS 7 : Classification and Measurement of Financial Instruments1 January 2026
    IFRS 18 - Presentation and Disclosure in Financial Statements1 January 2027
    Annual Improvement Volume 111 January 2026
    IFRS 18 - Presentation and Disclosure in Financial Statements1 January 2027
    IFRS 19 - Subsidiaries without Public Accountability: Disclosures1 January 2027
    Amendments to IFRS 10 and IAS 28: Sale or Contribution of Assets between an Investor and its Associate or joint venturePostponed indefinitely
    

 

Based on a preliminary assessment using currently available information, the Group does not expect the adoption of the above standards to have a material impact on the financial statements in the period of initial application. These preliminary assessments may be subject to changes arising from ongoing analyses when the Group adopts the standards. The Group plans to adopt the above standards on the effective date.

 

(b)           Standards in effect in 2026

 

The Group has adopted all new standards that have come into effect during the six months ended 31 December 2025. The adoptions do not have a material impact on the Group's interim condensed consolidated financial statements.

 

 

 

 

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

4          FAIR VALUE MEASUREMENT

 

The fair value of a financial instrument is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

 

The carrying amounts of cash and bank balances, trade and other receivables, finance lease receivables - current, trade and other payables - current, loans and borrowings - current and maintenance reserves are a reasonable approximation of fair value either due to their short-term nature or because the interest rate charged closely approximates market interest rates or that the financial instruments have been discounted to their fair value at a current pre-tax interest rate.

 


    31 Dec 202530 Jun 2025
    Carrying amountFair valueCarrying amountFair value
    US$'000sUS$'000sUS$'000sUS$'000s
    Financial assets:
    Finance lease receivables - non-current3,5463,29511,12910,301
    Pre-delivery aircraft deposits paid27,52927,52929,17829,178
    Derivative financial assets4024021,5501,550
    Aircraft purchase rights86,05086,05091,74091,740
    Investment in equity, fair value through profit or loss8,0228,0229,1159,115
    Financial liabilities:
    Deposits collected - non-current16,97715,60815,31313,379
    Loans and borrowings other than unsecured notes - non-current248,159235,827286,565264,290
    Unsecured notes294,927293,754295,688301,549
    Share warrants3,0443,0443,1423,142
    

The fair values (other than for unsecured notes, investment in debt instrument, fair value through profit or loss) above are estimated by discounting expected future cash flows at market incremental lending rate for similar types of lending, borrowing or leasing arrangements at the end of the reporting period, which is classified under level 2 of the fair value hierarchy.

 

The fair value of the unsecured notes and share warrants are based on level 1 quoted prices (unadjusted) in an active market that the Group can access at measurement date.

 

The fair value of pre-delivery aircraft deposits paid are classified under level 2 of the fair value hierarchy for which the inputs are observable for the determination of fair value using the discounted cashflow model.

 

The fair value of the derivative financial instruments is determined by reference to marked-to-market values provided by counterparties.  The fair value measurement of all derivative financial instruments is classified under level 2 of the fair value hierarchy, for which inputs other than quoted prices that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) are included as inputs for the determination of fair value.

 

 

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

4          FAIR VALUE MEASUREMENT (continued)

 

Assets measured at fair value classified under level 3:


    31 Dec
    2025    		30 Jun
    2025
    US$'000sUS$'000s
    Fair value measurement using significant unobservable inputs:
    Aircraft and engines732,647725,116
    

 

5          REVENUE

 


    31 Dec
    2025    		31 Dec
    2024
    US$'000sUS$'000s
    Lease rental revenue44,10844,558
    Less: amortisation of lease incentive asset(1,540)(1,628)
    42,56842,930
    Interest income on finance leases420780
    Maintenance reserves revenue10,2999,270
    End of lease compensation2,260-
    55,54752,980
    

Geographical analysis

           


    EuropeSouth AmericaAsia PacificTotal
    US$'000sUS$'000sUS$'000sUS$'000s
    31 Dec 202510,19881944,53055,547
    31 Dec 202410,031-42,94952,980
    

 

 

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

5          REVENUE (continued)

 

Operating lease commitments

 

The Group leases out aircraft under operating leases. The maturity analysis of the undiscounted lease payments to be received under operating leases are as follows:

 


    31 Dec
    2025    		31 Dec
    2024
    US$'000sUS$'000s
    Within one year84,46387,878
    One to two years79,93480,822
    Two to three years57,98075,315
    Three to four years41,42448,408
    Four to five years37,99631,482
    Later than five years36,15826,245
    

 

6          OTHER INCOME

 


    31 Dec
    2025    		31 Dec
    2024
    US$'000sUS$'000s
    Fees for late payment269753
    Foreign currency exchange gain-1,002
    Recovery of claims from customer-442
    Others185271
    4542,468
    

 

7          OTHER EXPENSES

 


    31 Dec
    2025    		31 Dec
    2024
    US$'000sUS$'000s
    Foreign currency exchange loss109-
    

 

 

 

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

8          FINANCE INCOME

 


    31 Dec
    2025    		31 Dec
    2024
    US$'000sUS$'000s
    Interest income from financial institutions1,4672,555
    Interest income from non-financial institutions28197
    Dividend income (money market funds)621-
    Finance income from discounting non-current deposits to fair value317315
    Gain on repurchases of unsecured notes--
    Gain on early full repayment of borrowings-1,084
    2,4334,151
    

 

9          FINANCE EXPENSES

 


    31 Dec
    2025    		31 Dec
    2024
    US$'000sUS$'000s
    Interest expense on borrowings8,1398,447
    Interest expense on unsecured notes12,47713,677
    Amortisation of loan transaction cost575699
    Amortisation of interest expense on non-current deposits324314
    Fair value loss on financial derivatives2,8002,002
    Loss on repurchase/redemption of unsecured notes8,790-
    Others79157
    33,18425,296
    

 

10         RELATED PARTY TRANSACTIONS

 

Significant related party transactions:


    31 Dec
    2025    		31 Dec
    2024
    US$'000sUS$'000s
    Entities controlled by key management personnel
    (including directors):
    Lease liability paid(159)(175)
    Consulting fee expense(349)(221)
    Service fee income4741
    

 

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

11        PROPERTY, PLANT AND EQUIPMENT

 


    Furniture and equipmentEnginesJet
    aircraft    		Turboprop aircraftTotal
    US$'000sUS$'000US$'000sUS$'000sUS$'000s
    31 December 2025:
    Cost or valuation:
    At 1 July 202564-751,883291,2771,043,224
    Additions42,619-23,01025,633
    At 31 December 2025682,619751,883314,2871,068,857
    Representing:
    At cost68---68
    At valuation-2,619751,883314,2871,068,789
    682,619751,883314,2871,068,857
    Accumulated depreciation and impairment:
    At 1 July 202546-226,75891,286318,090
    Depreciation expense44913,3134,73618,102
    At 31 December 20255049240,07196,022336,192
    Net book value:
    At 1 July 202518-525,125199,991725,134
    At 31 December 2025182,570511,812218,265732,665
    

 

 

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

11         PROPERTY, PLANT AND EQUIPMENT (continued)

 


    Furniture and equipmentJet
    aircraft    		Turboprop aircraftTotal
    US$'000sUS$'000sUS$'000sUS$'000s
    30 June 2025:
    Cost or valuation:
    At 1 July 2024102850,755289,4111,140,268
    Additions1631,92238,10170,039
    Disposals(54)-(38,101)(38,155)
    Revaluation recognised in equity-14,2601,86616,126
    Reclassified to assets held for sale-(145,054)-(145,054)
    At 30 June 202564751,883291,2771,043,224
    Representing:
    At cost64--64
    At valuation-751,883291,2771,043,160
    64751,883291,2771,043,224
    Accumulated depreciation and impairment:
    At 1 July 202491264,40284,355348,848
    Depreciation expense928,2829,22137,512
    Disposals(54)--(54)
    (Reversal of)/impairment loss-(2,541)(2,290)(4,831)
    Reclassified to assets held for sale-(63,385)-(63,385)
    At 30 June 202546226,75891,286318,090
    Net book value:
    At 1 July 202411586,353205,056791,420
    At 30 June 202518525,125199,991725,134
    

 

Assets pledged as security

 

The Group's aircraft and aircraft held under asset for sale with carrying values of US$555.5 million (30 June 2025: US$651.2 million) are mortgaged to secure the Group's borrowings (Note 20).

 

Additions and Disposals

 

During the period, the Group purchased 1 turboprop aircraft, 1 aircraft engine and sold 1 jet aircraft held under asset held for sale and recognised a gain on disposal of US$4.1 million.

 

 

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

11        PROPERTY, PLANT AND EQUIPMENT (continued)

 

Geographical analysis

 


    31 Dec 2025EuropeSouth AmericaAsia PacificTotal
    US$'000sUS$'000sUS$'000sUS$'000s
    Capital expenditure-2,61923,01425,633
    Net book value - aircraft and engines216,11815,954500,575732,647
    30 Jun 2025EuropeSouth AmericaAsia PacificTotal
    US$'000sUS$'000sUS$'000sUS$'000s
    Capital expenditure38,031-32,00870,039
    Net book value - aircraft221,200-503,916725,116
    

 

12         TRADE AND OTHER RECEIVABLES

 


    31 Dec
    2025    		30 Jun
    2025
    US$'000sUS$'000s
    Current
    Trade receivables7,7166,262
    Less:
    Allowance for expected credit losses(484)(432)
    7,2325,830
    Accrued revenue2,0362,144
    Less:
    Allowance for expected credit losses(5)(6)
    2,0312,138
    Other receivables1,105631
    Less:
    Allowance for expected credit losses-(22)
    1,105609
    Interest receivables261452
    Less:
    Allowance for expected credit losses(18)(14)
    243438
    Deposits551446
    Prepaid expenses790451
    11,9529,912
    

 


    Non-current:
    Other receivables-41
    Right-of-use assets820964
    8201,005
    

 

 

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

13         FINANCE LEASE RECEIVABLES

 

Future minimum lease payments receivable under finance leases are as follows:

 


    31 Dec 202530 Jun 2025
    Minimum lease paymentsPresent value of paymentsMinimum lease paymentsPresent value of payments
    US$'000sUS$'000sUS$'000sUS$'000s
    Within one year9,1898,6682,6321,756
    Less:
    Allowance for expected credit losses(43)(43)(22)(22)
    9,1468,6252,6101,734
    One to two years3,5893,54611,40511,129
    Two to three years----
    Three to four years----
    Four to five years----
    Later than five years----
    Total minimum lease payments12,73512,17114,01512,863
    Less: amounts representing interest income(564)-(1,152)-
    Present value of minimum lease payments12,17112,17112,86312,863
    

 

 

14        GOODWILL

 

The Group performs its annual impairment test in June and when circumstances indicate the carrying value may be impaired. For the purpose of these financial statements there was no indication of impairment. The key assumptions used to determine the recoverable amount for the different cash generating units were disclosed in the annual consolidated financial statements for the year ended 30 June 2025.

 

 

15        DERIVATIVE FINANCIAL ASSETS/LIABILITIES

 


    Contract/
    notional amount    		Fair value
    31 Dec 202530 June 202531 Dec 202530 Jun
    2025
    US$'000sUS$'000sUS$'000sUS$'000s
    Derivative financial assets -current
    Interest rate swap - current6,50058,5019714
    Derivative financial assets -non- current
    Interest rate swap - non-current75,99480,183393836
    Derivative financial liabilities
    Warrants--3,0443,142
    

 

 

 

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

15        DERIVATIVE FINANCIAL ASSETS/LIABILITIES (continued)

 

Hedge accounting has been applied for interest rate swap contracts and cross-currency interest rate swap contracts which have been designated as cash flow hedges.

 

The Group pays fixed rates of interest of 2.3% to 3.8% per annum and receives floating rate interest equal to 1 to 3 month SOFR under the interest rate swap contracts. 

 

The swap contracts mature between 28 January 2026 and 25 September 2031.

 

Changes in the fair value of these interest rate swap contracts are recognised in the fair value reserve. The net fair value gain net of tax of US$1.3 million (31 December 2024: loss of US$3.2 million) on these derivative financial instruments was recognised in the fair value reserve for the period.

 

The Group entered into Euro denominated lease agreements which create exposure to variability in cash flows due movements in the EUR:USD exchange rate.  To hedge its exposure to variable cash flows resulting from changes in EUR:USD spot rates, the Group has arranged Euro denominated financing which reduces overall exposure to variable cash flows to the extent that lease receipts and debt service cashflows are matched. The Group is making use of a non-derivative hedging instrument and has designated the cash flows with respect to the loan interest and principal repayment (hedging instrument) against a specific portion of the lease receivable (hedged item).

 

Unrealised foreign exchange gains and losses arising on Euro denominated loans designated as cash flow hedges are recognised in the foreign currency hedge reserve.  Unrealised foreign exchange gains and losses recorded in the foreign currency hedging reserve are systematically re-cycled through profit or loss over the remaining term of the related loan on a straight-line basis.

 

The share warrants consist of 5,654,078 (30 June 2025: 5,728,054) share warrants granted to the holders of the unsecured notes to subscribe for the ordinary shares of the Company exercisable to 31 October 2026 at a price of 114.5 pence per share (including cashless exercise option).

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

16        PRE-DELIVERY AIRCRAFT DEPOSITS PAID

 


    31 Dec
    2025    		30 Jun
    2025
    US$'000sUS$'000s
    Current14,44310,960
    Non-current13,08618,218
    27,52929,178
    Pre-delivery aircraft deposits paid, at fair value:
    At 1 July 2025/ 1 July 202429,17830,333
    Additions1,1346,238
    Transfer to property, plant and equipment upon delivery of aircraft(4,239)(6,790)
    Unrealised gain/(loss)1,456(603)
    At 31 December/30 June27,52929,178
    

 

17        AIRCRAFT PURCHASE RIGHTS

 


    31 Dec
    2025    		30 Jun
    2025
    US$'000sUS$'000s
    Aircraft purchase rights, at fair value:
    At 1 July 2025/ 1 July 202491,740112,780
    Unrealised loss(5,690)(21,040)
    At 31 December/30 June86,05091,740
    

The Group has determined that it would seek to dispose of excess aircraft purchase rights over and above its requirement to acquire additional aircraft for its fleet.  The Group accounts for aircraft purchase rights at fair value through profit or loss.

 

 

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

18        INVESTMENT IN EQUITY, FAIR VALUE THROUGH PROFIT OR LOSS

 


    31 Dec
    2025    		30 Jun
    2025
    US$'000sUS$'000s
    Listed equity, at fair value
    At 1 July 2025/ 1 July 20249,11510,745
    Unrealised loss(1,093)(1,630)
    At 31 December/30 June8,0229,115
    

The Group received 8,014,602 ordinary shares from an airline customer as part of the airline's restructuring plan during the year ended 30 June 2022.

 

The Group exchanged 8,014,602 unlisted ordinary shares in Philippine Airlines, Inc. with 124,787,353 ordinary shares in PAL Holdings, Inc. during the previous year.

 

The Group holds 124,491,353 ordinary shares in PAL Holdings, Inc as of 31 December 2025.

 

19         SHARE CAPITAL AND TREASURY SHARES

 

(a)        Share capital

 


    31 Dec 202530 Jun 2025
    No of sharesUS$'000sNo of sharesUS$'000s
    Allotted, called up and fully paid
    Ordinary shares of 1 penny each:
    At 1 July 2025/ 1 July 202474,950,2571,23470,878,1241,182
    Issue of shares47,98114,072,13352
    Cancellation(8,361,500)(137)--
    At 31 December/30 June66,636,7381,09874,950,2571,234
    

During the period, the Company issued 47,981 ordinary shares of 1 penny each at an exercise price of 114.5 pence following the exercise of the Company's listed warrants by warrant holders.

 

The holders of ordinary shares (except for treasury shares) are entitled to receive dividends as and when declared by the Company.  All ordinary shares carry one vote per share without restrictions.

 

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

19         SHARE CAPITAL AND TREASURY SHARES (continued)

 

(b)        Treasury shares

 


    31 Dec 202530 Jun 2025
    No of sharesUS$'000sNo of sharesUS$'000s
    At 1 July 2025/ 1 July 20248,361,50016,003--
    Acquired during the period5,181,99610,1328,361,50016,003
    Re-issue during the period(842,997)(1,648)--
    Cancellation(8,361,500)(16,003)--
    At 31 December/30 June4,338,9998,4848,361,50016,003
    

During the six months ended 31 December 2025, the Company bought 5,181,996 treasury shares at market prices ranging from 138.0 pence to 160.0 pence per share, cancelled 8,361,500 shares and re-issued 842,997 treasury shares through the employee warrants exercise.

 

(c)        Net asset value per share

 


    31 Dec 202530 Jun
    2025
    Net asset value per share (US$)(1)$3.70$3.66
    Net asset value per share (GBP)(2)£2.74£2.67
    

(1)  Net asset value per share is total equity divided by the total number of shares issued and   outstanding at period end.

(2)  Based on GBP:US$ exchange rate as at 31 December 2025 of 1.35 (30 June 2025: 1.37).

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

20         LOANS AND BORROWINGS

 


    31 Dec
    2025    		30 Jun
    2025
    US$'000sUS$'000s
    Secured borrowings293,797356,649
    Unsecured notes294,927295,688
    Total loans and borrowings588,724652,337
    Less: current portion(45,638)(70,084)
    Non-current loans and borrowings543,086582,253
    

 


    MaturityWeighted average interest rate per annum
    31 Dec
    2025    		30 Jun 202531 Dec
    2025    		30 Jun 2025
    %%
    Secured borrowings2026-20312026-20315.09%5.19%
    Unsecured notes203120268.50%8.25%
    

 

Secured borrowings are secured by first ranking mortgages over the relevant aircraft, security assignments of the Group's rights under leases and other contractual agreements relating to the aircraft, charges over bank accounts in which lease payments relating to the aircraft are received and charges over the issued share capital of certain subsidiaries.

 

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

21        MAINTENANCE RESERVES

 


    31 Dec
    2025    		30 Jun
    2025
    US$'000sUS$'000s
    Current:
    Maintenance reserves50,65456,880
    Maintenance lease contribution12,54312,543
    63,19769,423
    Non-current:
    Maintenance reserves29,18124,895
    Maintenance lease contribution6,4656,465
    35,64631,360
    Total maintenance reserves98,843100,783
    31 Dec
    2025    		30 Jun
    2025
    US$'000sUS$'000s
    At 1 July 2025/ 1 July 2024100,783135,423
    Contributions20,98132,450
    Utilisations(12,622)(7,879)
    Released to profit or loss(10,299)(22,086)
    Transfer to buyer-(6,687)
    Transfer to liabilities directly associated with assets held for sale-(30,438)
    At 31 December/30 June98,843100,783
    

During the six months ended 31 December 2025, maintenance reserves of US$10.3 million were released to profit or loss as income.

 

22        CAPITAL COMMITMENTS

 

                Capital expenditure contracted for at the reporting date but not recognised in the financial statements is as follows:

 


    31 Dec
    2025    		30 Jun
    2025
    US$'000sUS$'000s
    Property, plant and equipment183,554207,591
    

Capital commitments represent amounts due under contracts entered into by the Group to purchase aircraft. The Company has paid deposits towards the cost of these aircraft which are included in pre-delivery aircraft deposits paid.

 

As at 31 December 2025, the Group has commitments to purchase nine ATR 72-600 aircraft from the manufacturer with expected delivery dates ranging from 2026 to 2028. 

 

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

23        CONTINGENT LIABILITIES

 

                There were no material changes in contingent liabilities since 30 June 2025.

 

 

24        DIVIDENDS

 


    31 Dec
    2025    		31 Dec
    2024
    US$'000sUS$'000s
    Paid during the period:
    Dividends on ordinary shares
    -Interim (one-tier) dividend for 1.0 US cents (31 Dec 2024: Nil US cents) per share649-
    -Final (one-tier) dividend for Nil pence (31 Dec 2024: 0.5 pence) per share-450
    

Dividends are recognised as liabilities when they are approved for payment.

 

 

25        SUBSEQUENT EVENTS

 

Subsequent to the period end, the Company repurchased 170,000 ordinary shares, through the market at prices ranging from 138.0 pence to 141.8 pence per share.  The repurchased shares will be held in treasury.

In January 2026 the Company was notified that one of its Airbus A220-300 aircraft on lease to Air Baltic has been classified as unrepairable and is deemed to be a total loss. Avation will receive an insurance claim settlement of US$33.4 million as compensation for loss of the aircraft.

 

 

 

  

AVATION PLC

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2025

 

PRINCIPAL RISKS         

 

The Group's risk management processes bring greater judgement to decision making as they allow management to make better, more informed and more consistent decisions based on a clear understanding of risk involved.  We regularly review the risk assessment and monitoring process as part of our commitment to continually improve the quality of decision-making across the Group.

 

The principal risks and uncertainties which may affect the Group in the second half of the financial year will include the typical risks associated with the aviation business, including but not limited to any downturn in the global aviation industry, fuel costs, finance costs, war and extremism and the like which may affect our airline customers' ability to fulfil their lease obligations.

 

The business also relies on its ability to source finance on favourable terms.  Should this supply of finance contract, it would limit our fleet expansion and therefore growth.

 

 

GOING CONCERN

 

After making enquiries, the directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future.  For this reason they continue to adopt the going concern basis in preparing the financial statements.  The financial risk management objectives and policies of the Group and the exposure of the Group to credit risk and liquidity risk are discussed in the annual report for the Group for the year ended 30 June 2025.

 

 

DIRECTORS

 

The directors of Avation PLC are listed in its Annual Report for the year ended 30 June 2025.  A list of the current directors is maintained on the Avation PLC website: www.avation.net

 

 

STATEMENT OF DIRECTORS' RESPONSIBILITIES

               

The Directors confirm that, to the best of their knowledge, this condensed consolidated interim financial information have been prepared in accordance with UK-adopted IAS 34 and that the interim management report herein includes a fair review of the information required by DTR 4.2.7 and DTR 4.2.8 namely

 

·      an indication of important events that have occurred during the first six months and their impact on the Interim Report, and a description required by the principal risks and uncertainties for the remaining six months of the financial year; and

 

·      material related party transactions in the first six months and any material changes in the related party transactions described in the last annual report.

 

 

 

By order of the Board

 

 

Jeff Chatfield

Executive Chairman

Singapore, 25 February 2026

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