Ryan Mee, CEO of Fulcrum Metals, reviews FY23 and progress on the Gold Tailings Hub in Canada. Watch the video here.
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"Gama Aviation, the global business aviation service provider, has been awarded a contract by the Home Office to complete Transmitting Portable Electronic Devices ("TPED") testing on several Emergency Services aircraft in-line with its delivery of the new Emergency Services Network (ESN).
ESN is the next generation of critical communications for the three Emergency Services and other user organisations, and an element of ESN is the development of a 4G LTE Air to Ground (A2G) network and Aircraft Communication System (ACS). "
Good to see them ploughing on and getting involved with supplying specialist services to the government.
Meantime friends tell me that to get commercial flights - for instance to long distance to China - is incredibly expensive. That defies logic to me, but gives GMAA all the more of a competitive edge as people who need to travel eye the A to B process very nervously. Going private, perhaps joining together to fill a plane, becomes a better and better option. It may even be cheaper.
A bid would be great - let's hope at the least that Rozzi Business Inc continue to increase from the now almost 8%, or 5m shares, of GMAA which they've bought in the last six weeks (presumably taking up Downing's sales):
Https://www.investegate.co.uk/gama-aviation-plc--gmaa-/rns/holding-s--in-company/202004301638455533L/
Well that explains the sp surge lately
I've attempted the noble art of bottom fishing far too many times: only to find I've been flapping around in the shallows!
Let's hope it was better timed this time. :)
47p paid.
Apparently, a seller was holding it down and has CL finished selling. No buy quotes available unless calling broker. The seller was the reason this did not move up after the $30+ million sale recently.
Bottom-fishing buying coming in - and happy to pay well over the odds at up to 45p, way above the published offer price at the time.
... and topped up. Lost too much here already but like Rivaldo I can't see how private aircraft won't benefit greatly once the lockdown has lifted, if not before. $33m will have helped with cash flow in the meantime, on top of their Covid update on 9th April: "In terms of liquidity, the Group retains a $50m credit facility with HSBC of which $30m remains undrawn and we currently have $17m of cash following the receipt in March of a substantial annual advance payment in respect of a long-term contract."
While the ask price was supposed to be 37p my first offer was for 40, so beware: keeping at it I got it at 37 by working up from a lower figure.
Yep, today's encouraging news hasn't been flagged up on ADVFN's Portfolio, so here it is for the record in case anyone missed it:
Https://www.investegate.co.uk/gama-aviation-plc--gmaa-/rns/airops-software-secures-usd-2-5m-software-sale/202003100700075088F/
"Airops Software ("myairops") secures USD$2.5million software sale
Gama Aviation, the global business aviation service provider, announces that its Global Services subsidiary Airops Software Ltd (trading as myairops) has secured a USD$2.5million Software as a Service (SaaS) contract with one of the world's largest business aviation operators. The system is live and provides comprehensive fleet management, crew rostering and maintenance planning capabilities in support of a large fleet operation.
The three-year contract is the largest single deal yet signed by myairops, following a substantial investment in its SaaS platform by the Group.
Commenting on winning the contract, Marwan Khalek, Chief Executive of Gama Aviation said:
"We are pleased with the market traction being achieved by myairops, demonstrated by the confidence placed in the platform by one of the world's largest business aircraft fleet operators. It is another example of our strategic organic investment into innovative services that simplify business aviation."
......and further good news this morning
Looks like good news. To get $33m for the 24.5% stake in Gama Signature reflect nicely against the now £36m m/cap.
WH Ireland interestingly say this morning that the disposal will be earnings-enhancing going forward.
And that's against their previous forecasts of 12.6c EPS for last year and 13c EPS this year.
Also anecdotally I've been reading that the coronavirus alert has strongly benefited private aviation, for obvious reasons.
WH Ireland conclude today:
"WHI view: We view this move as strategically very sensible for Gama given its
minority ownership in a business that we forecast would have generated EBIT of
$4m in FY 2020E for the group and that is set to bring in cash of c.80% of Gama’s
current market capitalisation over the next four years. The group retains its
higher margin US Ground business, which illustrated strong growth at the time of
the interims in September.
We will review our PBT/EPS expectations to take account of this transaction at the time of the FY 2019E full year results (WHI est.FY 2019E PBT $10.0m, EPS 12.6c, FY 2020E PBT $10.5m, EPS 13.0c), whilst noting that this transaction should give investors confidence in the underlying value across the wider group."
Anyone have any views on the reasons for recent weakness? Is it because of expectation that there should have been a trading update by now or perhaps Hong Kong vulnerabilities? My hope was / is that we are in at the start of a more positive phase for this company.
Looks like good news in two of the three outstanding legal cases, with the final upcoming one already provided for and GMAA still anticipating "a net cash inflow as an overall result":
Https://www.investegate.co.uk/gama-aviation-plc--gmaa-/rns/litigation-update/201912110700084814W/
Bought about a year ago, so down almost 50%. But if their EBIT guidance is good ($11m for the year) I see a re-rate as likely, and the other news since the results has been positive. No further word from the company. Topped up. Will forget if I hold off!
Remember the merger of BBA's and GMAA's US charter and management operations - called Signature - into a 50/50 JV in 2017 to form the largest aircraft management business in the country:
Https://www.flightglobal.com/news/articles/bba-and-gama-merge-us-charter-and-management-operati-432834/
This morning BBA confirmed their disposal of Ortic, their MRO operation, for $1,365 million, to concentrate on Signature.
There are some interesting comments:
"Following completion of the Ontic disposal and given the on-going process to dispose of the ERO business, it is expected that the Group will from that point comprise predominantly the market-leading Signature business. This will enable enhanced focus on Signature, which the Board believes to be a significant source of future shareholder value creation. The Board has therefore elected to change the Company's name to "Signature Aviation plc" which will better align it with the Company's most significant brand in its core market. In addition, it will create a stronger and clearer connection of the brand to shareholders and other stakeholders."
"Signature's free cash generative characteristics should allow it to sustain a progressive dividend policy and the potential for ongoing returns of capital, surplus to the investment requirements of the Signature business, while maintaining a strong balance sheet within the target leverage range on a covenant basis."
Not used to a blue colour next to GMAA :o))
I did notice good news re GMAA's partner Wheels Up - raising such a large amount for expansion should be good for GMAA (who get a mention here):
Https://pulse2.com/wheels-up-128-million-funding/
"Wheels Up: $128 Million Funding, Over $1.1 Billion Valuation, And 6,000 Members
Wheels Up — a membership-based private aviation company — recently announced it raised $128 million in Class D equity capital. Funds managed by Franklin Templeton co-led the round with funds and accounts advised by T. Rowe Price and Fidelity Management & Research along with other institutional and private investors.
The post-money enterprise valuation of Wheels Up is now more than $1.1 billion. And this round of funding comes on the heels of Wheels Up’s recent acquisition of Travel Management Company, which closed a few months ago.
Wheels Up founder and CEO Kenny Dichter pointed out that this round of funding will be used for a number of business initiatives such as additional potential acquisitions, the acceleration of membership growth through further investment in sales and marketing, and significant scaling of the company’s technology and digital platforms.
Wheels Up significantly reduces the upfront costs to fly privately while providing unparalleled safety, service, flexibility, and quality. And Wheels Up offers a total private aviation solution for its user base of more than 6,000 members across North America through three unique membership options—Connect, Core, and Business—and a vast selection of program features. The Wheels Up Core and Business Members receive guaranteed access to a members-only fleet of 93 King Air 350i, Citation Excel/XLS and Citation X aircraft (operated exclusively by Gama Aviation) up to 365 days a year with as little as 24 hours’ notice and paying fixed hourly rates for time flown only.
etc"
H1 results are out, and are pretty reasonable in terms of results and encouraging in terms of outlook, with prior guidance of $10.5m to $11.5m EBIT reiterated, against a now £48m m/cap.
The overriding sense is that this large, sprawling business is being steadied, and that the period of investment and consolidation is starting to coming to an end and beginning to deliver (i.e Bournemouth, US Ground etc).
Cash flows were poor, but these were due to one-offs such as short-term changes to billing procedures and slow recovery of particular receivables.
Interesting comment from the Chairman, suggesting that acquisitions are still on the agenda:
"The Board will continue to oversee the reforms the Company is implementing in terms of corporate governance and financial discipline, whilst supporting the Company's organic and acquisitive growth strategy, with the aim of delivering stronger future shareholder returns."
Seems a pretty high caliber kind of guy. Once he's on board the BoD will be a great improvement on say a year or two ago. I'm down around 50% will be looking at the results keenly with a view to a top-up. Judicious averaging down usually seems to work for me although not every time.
Hi Dandee - re a takeover. I don't think the BoD would have gone through the selection process if they thought this was in the offing. Never say never of course, but one of my reasons for buying was that this is a fragmented market sector and Gama wanted to capitalise on this by acquisitions. As we have seen keeping on top of such a wide spread business can be quite a challenge and I was wondering what other competitors could be out there. I've no real knowledge of this market but bought in because I could see the business sense. I was actually tracking Hanger 8 back in the day when it was taken over.
Appointment of Chief Financial Officer
Gama Aviation Plc, the global business aviation services company, today announces Daniel Ruback's appointment to the post of Chief Financial Officer ("CFO"). Daniel's appointment will be effective from 16th December 2019 when he will also join the Company's Board.
Daniel is Finance Director, Signature Flight Support EMEA, a part of BBA Aviation plc, the world's largest fixed base operation (FBO) network operator with over 200 global locations. His responsibilities at Signature included the delivery of the EMEA business plan and strategic objectives, alongside ownership of the financial reporting, control, risk and compliance frameworks. From 2006 to 2015 Daniel worked at Smiths Group plc, the FTSE 100 global technology company in several roles, including a two-year assignment as Director, Operational Finance, Smiths Detection USA and finally as Head of Divisional Business Partnering, Smiths Detection. Daniel is a qualified chartered accountant.
Commenting on the appointment, Marwan Khalek, CEO of Gama Aviation Plc said:
"I am delighted to welcome Daniel to our executive leadership team, and I look forward to forward to working closely with him. Daniel brings with him a strong, proven background in aviation as well as significant knowledge running international finance teams in diverse businesses. This valuable experience will accelerate the improvements we are already delivering and help drive the next stage of our growth."
Simon To, Chairman of Gama Aviation Plc said:
"The Board is delighted to welcome Daniel to Gama Aviation. His appointment, which was diligently assessed and recommended by the nominations committee, completes a strong Board with the necessary range of complementary skills and expertise to navigate the challenging global trading conditions apparent in our key markets while driving ahead with our growth strategy."
The chairman has been paying around a pound per share. He probably invested around 18M to build that 30% stake.
Hutchison Capital Holdings Limited: 29.79%
Marwan Abdel-Khalek: 22.28%
Crescent Investments LLC: 4.08%
Canaccord Genuity Wealth Management: 8.01%
Downing LLP: 6.96%
Gresham House Asset Management: 4.68%
We already know that H1 results will be in line with forecast 12.6c EPS for the year.
This report from the business aviation sector in the U.S., Canada and the Caribbean is interesting. We already know that overall the sector was mixed in H1, but it's good to see that GMAA were the market leaders, and business is expected to improve markedly in H2:
Https://www.ainonline.com/aviation-news/business-aviation/2019-08-26/argus-sees-ops-growth-after-mixed-first-half
"Gama Aviation Signature logged the most hours of the 135 carriers in the first half at 42,020, which was down from the 43,974 in the first half of 2018. The next closest in terms of flight hours was Executive Jet Management at 31,053 hours, followed by XOJet (23,209), Delta Private Jets (20,314), and Solairus Aviation (15,581).
Argus anticipates that business aviation will be up 2 percent year-over-year in the second half, with September and December expected to bring the strongest gains in this period. Argus forecasts a 4.6 percent increase in September and 3.3 percent in December. Bolstering this is that returns for July surpassed initial expectations of a 1 percent rise; it actually logged a 2.4 percent increase."
Downing Strategic's quarterly investor letter to 30/6/19 (so issued before the latest in-line trading update) has some interesting reflections on GMAA. This is the conclusion:
"The results themselves, restatements and missed expectations aside, show some promising signs of growth in parts of the Management business (8% fleet growth in US and Europe, and doubling in Asia). The key is really to get scale in these businesses and to see the operational gearing start to come through. It’s a tough market but we think that there is a compelling business opportunity to scale up in Asia particularly, and the Hutchison relationship could help that. Over the long term, we still think consolidation is viable. There have been strategic changes in the Maintenance business, such as moving to Bournemouth and investment in new US facilities, both of which sound like the right long term moves but which bear the restructuring costs and operating cost investment through the P&L in the nearer term.
We think that the Maintenance proposition is a good one, bolstered by some very material special missions’ contracts. Gama has been winning contracts recently – two new ones total over $100 million over the life of the contracts. Elsewhere, cash generation was negatively affected by a large working capital outflow, but
we expect the debtors portion to reverse as debts are collected against a few larger customers. The balance is reflective of investment for growth, particularly inventories in new maintenance locations.
2019 will be a year of transition and rebasing of financials, as clearly some of the reporting practices of the past were not prudent. The half year results should give a better indication of what the business is really capable of, alongside, we hope, confirmation from the new chairman of the strategic plan.
In our view, there remain real opportunities to improve margins and cash generation across the business. M&A activity in the sector remains buoyant and multiples are generous for businesses with scale. This gives us confidence in the strategic value of the group as a fall-back valuation. The de-geared balance sheet and Hutchison’s interest provide comfort while the business transitions."
Yep, that's a very pleasant surprise - a nice in-line trading update, with no alarms/caveats. And the outlook for the full year also shows confidence, being in line with prior guidance.
Forecasts are for 9.85p EPS this year (with a 2.88p dividend). Baby steps, but perhaps this is now a recovery story.
londonstockexchange.com
Trading update for the 6 months ended 30 June 2019 - RNS
2-3 minutes
29th July 2019
Trading update for the 6 months ended 30 June 2019
Gama Aviation Plc, the global business aviation services provider, is pleased to report that its underlying trading performance for the six months ended 30 June 2019 is in line with management expectations. The outlook for the full year 2019 remains in line with the Group's previous guidance.
https://www.londonstockexchange.com/exchange/news/market-news/market-news-detail/GMAA/14165794.html