AIR.L Regulatory News (AIR)

Air Partner PLC

("Air Partner" or "the Group" or "the Company")

Results for the year ended 31 July 2011

Air Partner is a leading provider of private aviation services to industry, commerce, governments and individuals worldwide.

Highlights:

·; Focus on core broking has delivered strong results, despite a difficult trading environment.

·; Profit before tax up by 93% to £5.3 million; revenue up 23% to £282 million

·; Final dividend proposed of 11 pence per share, bringing dividends for the period to 16.5 pence per share, up 10%

·; Year characterised by response to unusual trading circumstances: shortage of wide bodied aircraft in first half, Arab Spring evacuations of 12,000 people in 6 weeks and aid flights to Japan and New Zealand in second half

·; Investment in skills and focus on sales already being seen in growth of revenues from non-UK offices

·; Cautious further investment to secure sustainable increases in profitability over the longer term

·; Aubrey Adams to stand down as Chairman in due course, to focus on other roles, once the search for his successor has been completed

Aubrey Adams, Chairman of Air Partner, commented:

"Trading performance in the year demonstrates clearly Air Partner's ability to add value and play an important role across the world. The team's years of experience and dedication to clients have been harnessed to competitive advantage, delivering a strong set of results. The Board is cautious in its assessment of prospects for the current year, given the severe economic uncertainty in major world markets and the lack of visibility which characterises our industry. Nevertheless, the Board is confident in the long term growth prospects for Air Partner's key markets and believes that cautious investment in people and in new systems will promote sales and provide a firm basis for future success.

The Group's core strategy remains unchanged: to focus on high quality broking and client care; to build a global presence at an appropriate pace and level of risk and to broaden the markets in which Air Partner is recognised as the leading provider of aviation solutions."

13 October 2011

Enquiries:

CHAIRMAN'S STATEMENT

The decision to concentrate on core broking has strengthened confidence within Air Partner and has helped to bring about a near doubling of profit before tax to £5.3 million (2010: £2.7 million). Revenue this year increased by 23% to £282 million, a new high point for the Group.

Air Partner remains financially robust, with no debt and the Board has been able to maintain its intention to increase dividends progressively year on year. Accordingly, a final dividend of 11 pence per share is proposed, to be paid on 16 December 2011 to shareholders on the register on 18 November 2011, subject to shareholder approval at the Annual General Meeting. This brings the total dividend for the year to 16.5 pence per share, an increase of 10% over the prior year.

Crucial to the delivery of these financial results has been the dedication of Air Partner's teams in their various countries and divisions, each contributing their individual skills and experience to a united goal. The Board is grateful to all those who work for, and with, Air Partner for their sustained effort - and for their support of the new management team in its first full year of running the business.

The Commercial Jet Broking division's rapid response to unusual trading circumstances led a profitable start to the financial year. International offices worked together to overcome a shortage of supply in wide-bodied aircraft which affected major clients in the latter part of 2010. Air Partner was able to maximise its supplier relationships to deliver charter contracts when others could not and, as a result, won important business.

The Group then experienced a period of high intensity emergency activity as the events of the Arab Spring in 2011 unfolded. Air Partner's financial security and its reputation for service to governments, non-governmental organisations and multi-national corporate clients counted strongly in the flurry of evacuations. Performance this year has shown that good broking skills and the flexibility to react quickly, matched by global reach and experience, can deliver impressive results.

Whilst short term factors drive the demand for air charters, Air Partner is also focusing on its longer term aim: to be the best global air charter provider, offering a total aviation solution for client needs and, at the same time, driving profitable growth for the benefit of shareholders and those who work within the business. The Group has entered a phase of cautious investment, to ensure that the building blocks are in place for Air Partner to be the leading global provider of aviation solutions into the future.

Increasing professionalism, together with improved financial reporting and stronger controls, will enhance Air Partner's governance. Investment in key people and in their continuing development will enable the Group to extend both its global presence and its service across the client portfolio. New system applications and the restructuring of operational management will improve efficiency, promote sales and extend business relationships.

Going forward, Air Partner needs to accommodate changes in the complexity of client needs, respond to increases in client numbers and further develop key products. In particular, we will aim to grow the contribution to Group profits from non-UK operations, whether from existing or newer developing markets.

Board

The Board was strengthened in June 2011 by the recruitment of a further independent non-executive director, Andrew Wood. A chartered management accountant and former Finance Director of BBA Aviation plc, Andrew brings to the Board highly relevant experience of private aviation and financial management; he now chairs the Audit Committee. The appointment was made using external consultants and followed a rigorous process, as recommended by the UK Corporate Governance Code. The Group as a whole will benefit from Andrew's knowledge and independent viewpoint.

I am very pleased to have been able to lead the Board and the Group out of an unsettled period and into its next phase of development. I will shortly be taking on a significant role within the Global Restructuring Group of the Royal Bank of Scotland and have therefore been reviewing my business commitments. With an excellent new management team in place at Air Partner and with the foundations firmly set for steady future growth, I have proposed that it would now be an appropriate time for the Board to begin the search for my successor. The Board will take the time needed to determine the qualities required of the next Chairman and the process will allow for an orderly transition over the coming months.

Economic situation

Global economic instability still presents the largest risk to Air Partner's short term growth prospects. Many Government, individual and corporate budgets are squeezed. Renewed financial volatility, resulting from US budget concerns and fiscal challenges in the Euro zone, means that recessionary pressure is a real threat in the short to medium term.

In a business such as this, where forward visibility of future bookings can be limited to weeks, rather than months, changes in any of our main client sectors can have a significant effect on annual performance and it is difficult to predict with any accuracy future trading levels. However, we remain convinced about the long term growth prospects for the markets in which we operate.

Recovery in the important financial and incentives sectors is dependent upon economic growth. In the aviation market as a whole, the business environment remains competitive. In the absence of more regulation or a major industry consolidation, day to day trading pressures are unlikely to improve in the shorter term. Within this tough economic environment, added value is an important factor across Air Partner's client base. Added value comes from industry knowledge, responsiveness to urgent needs, service levels which exceed clients' expectations and the ability to cover the globe, for any purpose, at any time.

Outlook

Trading performance in the year demonstrates clearly Air Partner's ability to add value and play an important role across the world. The team's years of experience and dedication to clients have been harnessed to competitive advantage, delivering a strong set of results. The Board is cautious in its assessment of prospects for the current year, given the severe economic uncertainty in major world markets and the lack of visibility which characterises our industry. Nevertheless, the Board is confident in the long term growth prospects for Air Partner's key markets and believes that cautious investment in people and in new systems will promote sales and provide a firm basis for future success.

The Group's core strategy remains unchanged: to focus on high quality broking and client care; to build a global presence at an appropriate pace and level of risk and to broaden the markets in which Air Partner is recognised as the leading provider of aviation solutions.

Aubrey Adams

Chairman

CEO'S REVIEW

Financial Review

Despite continuing difficult trading conditions, the business performed well during the period. Profit before tax rose by 93% to £5.3 million (2010: £2.7 million) driven by a 23% increase in revenue to £282 million (2010: £230 million) and an increase in gross profit margin to 9.2% (2010: 8.7%). Basic earnings per share from continuing operations rose 23% to 32.5 pence per share. Air Partner remains debt free.

Discontinued operations

The business generated £0.7 million profit from discontinued operations. The closure of non-trading subsidiaries in Australia and a branch in Japan triggered a technical profit of £0.5 million with cumulative exchange differences in the translation reserve being recycled through the income statement, as required by International Financial Reporting Standards. The remaining £0.2 million represents an increase in the estimated return in respect of the administration of Air Partner Private Jets Limited, the former private jet operating company. The increase in expected return to the Company, to £0.6 million, was based on advice from the administrators.

Cash

Cash during the period fell by £4.5 million to £7.2 million. This was the result of a number of one-off cash outflows - principally, the resolution of historic accruals (£3.1 million), settlement of claims in relation to the discontinued private jet operating company (£0.6 million) and payments related to the relocation of the UK office (£0.6 million). Excluding these items, cash at the year end would have been £11.5 million, broadly in line with the opening position.

Cash levels do show considerable short term volatility as credit is extended to, and invoices are then settled by, larger clients. The cash position seven days after the year end had improved significantly.

Internal Controls

Legacy issues have been tackled in this period. As set out above, a cash payment of £3.1 million was made in settlement of historic accruals.

In July 2011, an announcement was made to the market concerning a potential liability for amounts of unpaid Federal Excise Tax in respect of past flights involving a US destination. Provision of £1.0 million was made by the Group, resulting in a restatement of retained earnings of £0.8 million and a reduction in current year pre-tax profit of £0.2 million. This estimate includes likely costs in relation to the tax, interest for late payment, any penalties and professional fees. The reasonableness of the Company's detailed calculations supporting the estimated provision have been independently reviewed by a leading accountancy firm. The Company has initiated discussions with the US Internal Revenue Service and the liability is expected to be resolved before 31 July 2012.

Air Partner has strengthened its financial management team considerably and there have been significant improvements in processes and reporting procedures in the period under review. As a prudent step to minimise the likelihood that there were other significant legacy liabilities, it was also announced in July that a top four accountancy firm had been appointed to review control procedures and provide independent, additional assurance. This review has now been completed and did not identify any additional liabilities. The report did make some recommendations on improving internal controls which will be implemented during the year.

Operating Review

The Group rose to the challenge presented by extraordinary trading circumstances this year. Revenue of £6.8 million was generated from Commercial Jet and Freight broking of flights chartered in response to the events of the Arab Spring and significant ongoing contracts were also won across the Group, for example from clients in the automotive, transport and oil and gas sectors.

Strategic progress has been made in exploring new markets and in developing products, while the recruitment of additional sales and broking staff, including established aviation professionals, has expanded the specific industry knowledge and connections available to Air Partner. This investment in people and renewed focus on strategic priorities are showing results and the proportion of business being generated and executed by non-UK offices is growing.

Commercial Jet Broking

The Commercial Jet Broking division was able to take advantage of the co-ordinated resources of the Group's international offices to satisfy client requests for particular aircraft configurations, during a period of shortage of supply in the first half of the financial year. This division also saw the greatest impact from the high levels of demand for repatriation flights from Libya, Egypt, Bahrain and Tunisia in the early part of 2011. Commercial Jet broking teams in the UK, Germany, France, Dubai and the US together sourced aircraft to evacuate over 12,000 people over a six week period. The teams were also involved in dispatching repatriation and aid flights to Japan following the tsunami in March 2011, as part of Air Partner's contract with the Department for International Development ("DFID").

This division, the largest across the Group and the major contributor to Group profit, exceeded its targets for the year, with revenue increasing by 49% to £170.0 million (2010: £114.3 million) and an 84% increase in profit, to £2.7 million (2010: £1.5 million).

There was continuing success in tenders for governments and non-governmental organisations but sales were also strong in the tour operator market, where business is showing encouraging progress, in particular in Italy, France, Germany and Austria.

Air Partner will continue to seek out clients in smaller niche areas of business where there is an alignment of brand values and a shared understanding of the importance of high levels of customer service. These include pilgrim flights, sports team and entertainment industry contracts, where a bespoke and adaptable aviation solution provides the best service to meet specific needs.

There was encouraging business from the Conference and Incentives sector, particularly in France and Switzerland. However, renewed instability within the Euro zone could limit short term recovery in this area.

The division has a three year target of developing new multi-national markets to broaden its client base and has had some early success in the natural resources sector, where global reach and cost-effective solutions to logistical difficulties are important. Relationships have been renewed with automotive clients by the German office, which has also responded well to tenders for longer term regular rotations and "shuttle" services into Russia and South Africa.

The division's aim is to continue to work closely with key clients but also to increase the number and quality of accounts to diversify risk in a period of economic uncertainty.

Private Jet Broking

The Private Jet Broking business continued to be affected by a move among some corporate and banking clients to de-scope their charter requests and choose lighter and smaller aircraft. This trend has coincided with a period of high capacity of such aircraft in a very competitive market. Revenue fell by 2% to £40.7 million (2010: £41.4 million) but careful control of margins and cost allocation significantly increased profitability.

After a difficult prior year, action was taken to address performance in this area of the business, notably by investment in building up the sales team. Increased sales focus, together with the division's strong reputation for client care, saw divisional profit increase by 85% to £1.2 million (2010: £0.7 million). Recruitment in the UK and US, developing sales relationships in Spain and Eastern Europe and a new office in Monaco are expected to reap rewards in the longer term. However, this sector remains particularly vulnerable to changes in the economic environment.

Client care is a key differentiator in this market and Air Partner was honoured by the renewal of the Royal Warrant as supplier of Aircraft Charter services to Her Majesty The Queen for a further three year period. This is a hallmark of great distinction and a source of pride for all members of the Air Partner team.

The high quality of service is not limited to heads of state but is extended to all private jet clients. Wide industry knowledge and relationships built up with a large number of different operators mean that Air Partner can charter flights in areas of the world inaccessible to some competitors and can respond well in difficult circumstances, such as the provision of ambulance flights.

For those looking for a fixed price solution, the JetCard product provides clients with guaranteed access to an aircraft of their choice, at 24 or 48 hours' notice, at a fully inclusive hourly rate. From the time of purchase, the hourly rate is fixed, there is no expiry date and the value of hours outstanding can be refunded to the client at any time.

While renewal rates remain strong, JetCard use has been evolving, with more corporate clients considering the JetCard as a convenient and transparent alternative to fractional ownership schemes and individuals travelling further, for business, leisure or international sporting and cultural events. JetCard's guaranteed ready access to private aviation can be used to secure an all-inclusive fixed price for regular routes within a single geographic area, or it can run alongside ad-hoc charter arrangements within a single Air Partner relationship.

Strengthening of the sales team contributed to an 82% increase in the number of JetCards sold and growth of 22% in JetCard cash deposits. Sales came from across the Group, with a third being generated outside the UK.

Freight Broking

The Freight Broking division experienced a year of transition as it sought to rebalance its business and develop stronger connections with clients in the freight forwarding and transport sectors, following completion of a major government contract. As a result revenue was down 25% year on year to £41.8 million (2010: £55.7 million) and profit before tax in this sector fell by 36%, to £0.2 million (2010: £0.4 million).

The need for continuing diversification of the client base is well recognised and focus on this area has resulted in client numbers in the industrial and commercial sector increasing by 19% in the period under review.

The growth of the international Air Partner freight network continues to be valuable in locating local capacity and the team has extended its international reach successfully through General Sales Agency arrangements in the Far East, providing wide-bodied capacity to the Hong Kong and Shanghai markets.

Air Partner's French office enhanced its reputation in the Freight market through its work chartering aircraft to Japan following the tsunami in March 2011, alongside important earthquake relief and medical equipment flights organised by colleagues in the German office. Under the framework contract with DFID, 100 tonnes of fresh water were transported from Hong Kong to Japan and, more recently, Land Cruisers were airlifted towards their final destination in Libya, to support aid efforts.

Towards the end of the year, the Freight team launched its new Time Critical product. This new door to door freight delivery service includes online booking and tracking systems for the convenience of large corporate clients. The product has already generated interest from market leaders in the aerospace and automotive industries. Both of these sectors operate to tight schedules which are built into their brand values and are crucial to their own ongoing customer service standards. Air Partner's facility to put together private aviation services with freight forwarding capacity matches this profile well and will be rolled out from the UK to other offices in the coming year.

Other Services

The contribution to Group revenue from fuel sales, the Emergency Planning Division, aircraft sub-leasing within our 24 hour operations capability and the in-house travel agency increased by 59% to £29.5 million (2010: £18.6 million). These additional services are complementary to core broking capacity. They are important to the Group in extending relationships and proving to clients our integrated approach to solving their transport problems.

The Fuel team won a number of new major contracts this year, harnessing the benefits of international co-operation across the UK, French and Italian offices in particular. New clients included non-governmental and major transport organisations, such as the World Food Programme and a contract won with British Airways for the supply of fuel to ad-hoc and diversion locations, outside its standard international fuelling arrangements. Other major airlines have expressed interest in similar services.

Political instability in North Africa and the Middle East generated higher levels of enquiry for the Emergency Planning Division. Contingency planning for the potential repatriation of employees is a priority for a wide range of multi-national organisations which operate in areas of the world subject to violent disturbance or natural disaster. From smaller charities to some of the largest oil companies, clients appreciate Air Partner's integrated industry knowledge and 24 hour operational capacity when faced with dangerous or difficult circumstances. Repatriation activities are often matched with relief and aid flights: as people are evacuated, emergency supplies can be delivered for those who remain.

Substantial additional revenues were generated in this period by members of the Aircraft, Crew, Maintenance and Insurance (ACMI) team. This specialist sub-leasing service is built on knowledge of aircraft availability across a large number of operators. It allows commercial and private airlines to obtain substitute aircraft on short or longer term leases - for example, to replace a charter service aircraft which has experienced technical failure or for longer term weekly scheduled rotations during the busy European summer holiday season. The team doubled in size during the year to grow market share. Revenue grew significantly as a result of the team's 24 hour availability and excellent relationships with operators.

Together with the ACMI team, Air Partner's flight planning, flight watching and ground handling capabilities were rebranded during the year as Ops24. During this year, when airports in western Europe were badly affected by snow during the winter months and earthquakes in Japan and New Zealand later disrupted travel plans in the southern hemisphere, the flight operations centre at Gatwick was on hand to assist and advise clients.

The expertise within Ops24 allows bookings to be made on any size of aircraft at any time of the day or night; the Group's network of international offices means that payments can be made during weekends and holidays and an Air Partner client can be in contact with the team 24 hours a day, 365 days a year.

Profit from Other Services as a whole increased to £1.1 million (2010: £0.2 million).

Strategy

Our strategy remains to focus on core broking and to promote sales and build business by concentrating on five key target areas:

·; investing in the people and systems crucial to Air Partner's business

·; building strong relationships with operators and aviation service providers across the world

·; developing products which give clients the single best aviation solution for their needs

·; diversifying the client base so that a fall in demand or cyclical changes in one key sector can be better absorbed

·; growing the business into new territories outside existing developed markets, subject to proper risk assessment and business planning.

In this period we have concentrated on building the strategic foundations for development of the business into different client markets and new geographic territories through the next five years.

Investment

The main asset of the Group is its people. 21 new client-facing roles have been created this year, representing an overall increase of over 18% in sales and broking capacity across the Group.

In this period, Air Partner has seen results from recruiting established professionals: an example is the substantial increase in sales by the US freight business following the recruitment of two experienced brokers. In turn, those who are at an earlier stage of their career benefit from working within a team of professionals and from continual learning. The UK office was pleased to regain a one star rating in The Sunday Times 2011 "Best Companies To Work For" Survey. Talent management and learning and development initiatives are being implemented which will encourage personal success, to ensure that Air Partner people are " best in industry".

To support the recent programme of investment in people, a commitment has also been made to implement a new integrated financial and customer relationship management system. This will give all members of the Air Partner team a co-ordinated resource to share information across the Group and take action in response to changes in the key indicators of business performance. It will improve administrative efficiency, help drive Group sales and marketing efforts and record feedback to enable continuous improvement in client care.

The Board is mindful that, while some returns from recent investments are already materialising, other benefits may take time to come through. In the meantime, we will invest cautiously where required. Costs must, and will, be monitored carefully.

Products geared to clients

High standards of client care add value to distinguish Air Partner's offering from that of a simple travel intermediary. Extending our service through different distribution channels is one way in which the benefits of private aviation can be made accessible to a new generation of clients who look across the global market for the best provider of any service.

The first booking through Freight's Time Critical service in June 2011 and the Air Partner iPhone App, launched just after the year end, are examples of a significant move forward. Both give potential clients the ability to check availability of the types of aircraft they might need and an easy way of comparing an integrated private aviation solution against the regular scheduled services. The success of these products, particularly in attracting new clients, will be monitored over the coming months.

They also require strong working relationships with other service providers. This is a key focus area for the Group. Alliances, supplier agreements and General Sales Agency arrangements, under which local knowledge is used to source supply and market Air Partner products in a particular country or business area, are starting to deliver results. The benefits have been seen this year in freight business won in south east Asia, clients of CitationAir in the US using the Air Partner JetCard facility in Europe and specialist aircraft configurations required by Commercial Jet clients being sourced from France and Turkey.

Expanding into new areas, meeting new demands

The Group has a long term objective to increase the proportion of business derived from outside the UK: international offices this year have accounted for 42% of total revenues (2010: 38%). The largest offices outside the UK currently are France, Germany, Italy and the US and they have the greatest impact on non-UK revenues and profits. Following a review of the Dubai office, its focus has changed from full service delivery to generating sales. Progress will be kept under review in the current year.

Diversification of the business means looking towards new territories, whose economies are developing notwithstanding the fiscal concerns within the US and the EU. Detailed work is ongoing to establish a credible presence in Asia, with India a particular area of focus. The Group is also considering possible approaches to developing business further in South America and Africa. Provision has been made within the three year business plan for establishment of a presence in at least one of the BRIC territories, subject to careful consideration of the balance between risk and opportunity in each case.

The events of this year have shown that international reach is important but our goal is not just to place a flag on a territory - the strategy is to attract clients of different national origins, in different sectors, wherever they operate in the world. In turn, the Group will itself extend Air Partner's business model where there is client demand and availability of supply, keeping overheads and risk under control.

In a year of celebration of an unsurpassed fifty years' trading, Air Partner is proud to be still growing and developing - but it is also important to highlight the fundamental principles which have remained unchanged: the commitment to service, the building of strong relationships with clients, with suppliers and with people across the aviation industry and the eagerness "to deliver the impossible as a matter of routine".

Mark Briffa

CEO

Financial information

This preliminary announcement of annual results was approved by the Board of Directors on 12 October 2011. The announcement has been prepared solely to provide additional information to shareholders, in accordance with the UK Listing Authority's Disclosure and Transparency Rules. It should not be relied on by any other party, for any other purpose.

The financial information in this preliminary announcement which comprises the consolidated income statement, consolidated statement of comprehensive income, consolidated statement of financial position, consolidated statement of changes in equity, consolidated statement of cash flows, summary accounting policies and related notes does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006.

Statutory accounts for the year ended 31 July 2011 have not yet been delivered to the Registrar of Companies. The auditor's reports on the financial statements for the years ended 31 July 2011 and 31 July 2010 were unqualified and did not contain a statement under Section 498 of the Companies Act 2006. The financial statements for the year ended 31 July 2010 have been delivered to the Registrar of Companies.

Forward-looking statements

Announcements issued by Air Partner plc may contain forward-looking statements, indicated by words such as "aims", "believes," "expects", "intends," and similar expressions. These statements reflect current views and expectations up to the date of approval of this statement and are made in good faith by the directors. Unless otherwise required by laws, regulations or changes in accounting standards, Air Partner accepts no obligation to update these statements as a result of future events or new information subsequently obtained. New announcements will be made to the market as required under the Disclosure and Transparency Rules.

Trends and factors affecting the business

Lead times for ad-hoc bookings are measured in days or weeks, rather than months. Forward bookings can be impacted very suddenly by changes in financial markets, political instability and natural events affecting the movement of people or cargo from one country to another. Economic uncertainty affects corporate, government and individual clients and affects the quality of supply of aircraft as operators consolidate or leave the market. These are trends outside the Group's control but the strategy remains to diversify to address seasonality and changes in the client mix.

Principal risks and uncertainties facing the Group

Aircraft charter broking on the Air Partner model can be classed as a relatively low financial risk business, in that the broker sells capacity on aircraft owned and operated by a third party and contracts are normally placed as mirrored transactions. The Group does not have any contractual arrangements with any significant individual or company which are essential to continuation of the business.

The Board has reviewed the processes for identification and reporting of risks during the year, including operational aviation-related risks (shortages of supply, adverse weather conditions, competitive pricing pressure and regulatory changes) and financial risks such as foreign exchange and interest rate fluctuations, credit risk and liquidity and cashflow management. The profile of both financial and operational risks varies from time to time. The principal risk to the Group's business stems from the ongoing financial position of clients and the general economic conditions in which they operate, affecting their willingness to charter. Ad-hoc charters are likely to continue to be impacted by serious economic instability in the major world markets.

Going concern

After making enquiries, the directors are satisfied that the Group and the Company have adequate resources to continue in business for the foreseeable future. The directors have therefore continued to adopt the going concern basis in the preparation of these financial statements.

Directors' responsibility statement

Each of the directors serving at the date of approval of the accounts confirms that, to the best of his knowledge and belief:

·; the financial statements, which have been prepared in accordance with IFRS as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and financial performance of the Group; and

·; the Chairman's Statement and the CEO's Review, together with the supporting notes, give a fair review of the Group, including a description of the principal risks and uncertainties faced by Air Partner plc.

The responsibility statement was approved by the Board of Directors on 12 October 2011.

Air Partner PLC

("the Group" or "the Company")

Preliminary Announcement of audited results for the year ended 31 July 2011

Consolidated income statement

for the year ended 31 July 2011

Consolidated statement of comprehensive income

for the year ended 31 July 2011

Consolidated statement of financial position

as at 31 July 2011

Consolidated statement of changes in equity

for the year ended 31 July 2011

The translation reserve represents the accumulated exchange differences arising from the impact of the translation of subsidiaries with a functional currency other than Sterling.

The share option reserve relates to the accumulated costs associated with the outstanding share options issued to staff but not exercised.

Consolidated statement of cash flows

for the year ended 31 July 2011

1 GENERAL INFORMATION, BASIS OF PREPARATION AND ACCOUNTING POLICIES

General information

The Company is a limited liability company incorporated and domiciled in England and Wales under registration number 980675. The address of its registered office is 2 City Place, Beehive Ring Road, Gatwick, West Sussex RH6 0PA. The Company is listed on the London Stock Exchange.

This condensed consolidated financial information was approved for issue on 12 October 2011.

This condensed consolidated financial information does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. Statutory accounts for the year ended 31 July 2011 were approved by the board of directors on 12 October 2011, but have not yet been delivered to the Registrar of Companies. The auditor's reports on the financial statements for the years ended 31 July 2011 and 31 July 2010 were unqualified and did not contain a statement under Section 498 of the Companies Act 2006. The financial statements for the year ended 31 July 2010 have been delivered to the Registrar of Companies.

Basis of preparation

The financial information attached has been extracted from the audited financial statements for the year ended 31 July 2011 and has been prepared in accordance with IFRS as adopted by the EU and IFRIC interpretations issued and effective at the time of preparing those financial statements.

Accounting policies

Except as described below, the accounting policies applied are consistent with those of the annual financial statements for the year ended 31 July 2010, as described in those annual financial statements.

- IFRS 2 Share-based Payment (amendment); effective for periods beginning on or after 1 January 2010. The standard has been amended to clarify the accounting for group share-based payment transactions. Although the adoption of this amendment did not have any impact on the financial position of the Group, it has resulted in a restatement of the comparative information within the Parent Company's financial statements as follows:

~ As at 1 August 2009: an increase in investments in subsidiaries of £406,000 and a corresponding increase in retained earnings;

~ As at 31 July 2010: an increase in investments in subsidiaries of £451,000 and an increase in profit for the year then ended of £45,000;

~ Adoption of the amendment resulted in an increase in investments in subsidiaries of £528,000 as at 31 July 2011 and an increase in profit for the year then ended of £77,000.

- IFRIC 19 Extinguishing Financial Liabilities with Equity Instruments; effective for periods beginning on or after 1 July 2010. The interpretation provides guidance on the accounting treatment to be applied by the issuer of equities when a financial liability is extinguished by the issue of equity instruments. The adoption of the interpretation had no effect on the financial position or performance of the Group.

- Improvements to IFRSs (issued April 2009); certain improvements effective for periods beginning on or after 1 January 2010. This set of amendments was issued to make necessary, but non-urgent, amendments to IFRSs. The adoption of the amendments had no effect on the financial position or performance of the Group.

- Improvements to IFRSs (issued May 2010); certain improvements effective for periods beginning on or after 1 July 2010. This set of amendments was issued to make necessary, but non-urgent, amendments to IFRSs. The adoption of the amendments had no effect on the financial position or performance of the Group.

The following standards and interpretations came into effect but they are not relevant to the Group:

- IAS 32 Financial Instruments: Presentation, Classification of Rights Issues (amendment); effective for periods beginning on or after 1 February 2010.

New standards, amendments and interpretations in issue but not yet effective

The following standards, amendments and interpretations to existing standards have been published and are mandatory for accounting periods beginning after 1 August 2010 or later periods, but they have not been early adopted by the Group:

- IAS 1 Presentation of Financial Statements; effective for periods beginning on or after 1 July 2012;

- IAS 12 Income taxes - Recovery of underlying assets (amendment); effective for periods beginning on or after 1 January 2012;

- IAS 24 Related Party Disclosures (revised); effective for periods beginning on or after 1 January 2011;

- IAS 27 Separate Financial Statements and IAS 28 Investments in Associates and Joint Ventures (revised); effective for periods beginning on or after 1 January 2013;

- IFRIC 14 Prepayments of a Minimum Funding Requirement (amendment); effective for periods beginning on or after 1 January 2011;

- Improvements to IFRSs (issued May 2010) - certain improvements effective for periods beginning on or after 1 January 2011;

- IFRS 7 (amendment) Financial instruments disclosures; effective for periods beginning on or after 1 July 2011;

- IFRS 9 Financial Instruments; effective for periods beginning on or after 1 January 2013;

- IFRS 10 Consolidated Financial Statements; effective for periods beginning on or after 1 January 2013;

- IFRS 11 Joint Arrangements; effective for periods beginning on or after 1 January 2013;

- IFRS 12 Disclosure of Interests in Other Entities; effective for periods beginning on or after 1 January 2013;

- IFRS 13 Fair Value Measurement; effective for periods beginning on or after 1 January 2013.

There are no standards and interpretations in issue but not yet adopted which, in the opinion of the directors, will have a material effect on the reported income or net assets of the Group.

Restatement - Federal Excise Tax

During the year, the Company identified a liability in relation to unpaid Federal Excise Tax due on certain flights contracted by the Company outside the US but involving a US destination. This liability had not been identified and provided for in prior years, and accordingly the comparative information within the Group and Company financial statements has been restated as follows:

- As at 1 August 2009: an increase in provisions of £726,000, an increase in deferred tax assets of £129,000 and a corresponding reduction in retained earnings of £597,000;

- As at 31 July 2010: an increase in provisions of £780,000, an increase in deferred tax assets of £134,000, an increase in administrative expenses of £31,000, an increase in finance expense of £23,000, a reduction in the taxation charge of £5,000, and a reduction in basic and diluted earnings per share respectively of 0.48 pence and 0.48 pence;

- The restatement resulted in an increase in provisions of £1,000,000 and a reduction in current tax liabilities of £177,000 as at 31 July 2011, and an increase in administrative expenses of £196,000, an increase in finance expense of £24,000, a reduction in the taxation charge of £43,000, and a reduction in basic and diluted earnings per share respectively of 1.73 pence and 1.71 pence for the year then ended.

Key accounting estimates and judgments 

The preparation of financial statements requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. These estimates and associated assumptions are based on historical experience and various other factors believed to be reasonable under the circumstances. Actual results could differ from these estimates. These underlying assumptions are reviewed on an on-going basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period; or in the period of the revision and future periods if these are also affected.

Federal Excise Tax

An estimate has been made of the Company's liability for unpaid Federal Excise Tax arising on certain flights contracted by the Company outside the US but involving a US destination. The estimate is supported by detailed calculations, and assumptions which are based on input from the Company's US tax advisors. However, these calculations are complex and discussions with the relevant authorities are still at a preliminary stage, hence the ultimate payment may vary from the amount provided at the reporting date.

Third party claimsAn assessment has been made of the potential costs of settlement of third party claims received following the closure of Air Partner Private Jets Limited, based on discussions with advisors and the outcomes of similar legal cases. There is no guarantee that such claims will be successful, nor that the full amount of the provision will be required.

Proceeds from administration

On 15 March 2010, Air Partner Private Jets Limited, a wholly-owned subsidiary, was put into administration. On that date the control of the subsidiary was passed to the administrators. Management has made an estimate of the dividends that the Company will receive, based on advice from the administrators. However, until the administration process is finalised, there is no certainty as to the Company's final dividends.

Impairment of aircraft

During the year, the carrying value of the Group's sole owned aircraft was written down to management's estimate of its recoverable amount. Based on the assumption that the aircraft will be sold, the recoverable amount was equal to an estimate of the aircraft's fair value less costs to sell, based on a sales price agreed with a third party. It is possible that the sale will not be completed, or that the final sales price will differ from the agreed amount, or that the selling costs will not equal management's estimates.

2 SEGMENTAL ANALYSIS

The services provided by the Group consist of hiring different types of aircraft for charter to its clients and related aviation services. The Board reviews the performance of the services that are provided by the Group on the following basis: Commercial Jet Broking, Private Jet Broking, Freight Broking and Other Services. Each of these components has been identified as an operating segment.

Sale transactions between operating segments are carried out on an arm's length basis and all revenues, results, assets and liabilities which are reviewed by the Board are prepared on a basis consistent with those that are reported in the financial statements.

Revenues from external customers are derived primarily from the provision of services within the commercial jet, private jet and freight broking operations. Revenues are also derived from the offering of freight broking services, operations and travel services.

The Board does not review information about the amounts of additions which are made to the operating segments' non-current assets. Assets and liabilities are not reviewed at a segmental level, therefore these are not disclosed.

Discontinued operations comprised the activities of Air Partner Private Jets Limited, which was put into administration on 15 March 2010.

The segmental information, as provided to the Board for the reportable segments on a monthly basis, is as follows:

The Company is domiciled in the UK but, due to the nature of the Group's operations a significant amount of revenue from external customers is derived from overseas countries. The Group attributes revenue to individual countries based upon the location of the assets used to generate those revenues. Apart from the UK, no single country is deemed to have material revenue and non-current asset levels, but the Board continues to monitor potential reportable segments.

The Board also reviews information about operating segments on a geographical basis based on the parts of the world which are considered to be key to operational activities. As a result the following additional information is provided showing a geographical split of the United Kingdom, Europe, the United States of America and the Rest of the World.

3 Tax

Corporation tax in the UK was calculated at 27.33% (2010: 28%) of the estimated assessable profit for the year. Taxation for other jurisdictions was calculated at the rates prevailing in the respective jurisdictions.

The charge for the year can be reconciled to the profit per the consolidated income statement, as follows:

The UK corporation tax rate decreased from 28% to 26% from 1 April 2011. The impact on the current year's tax charge is shown above. The deferred tax balance has been adjusted to reflect this change.

Further reductions to the UK corporation tax rate have been announced. The changes, which are expected to be enacted separately each year, propose to reduce the rate by 1% per annum to 23% by 1 April 2014. The changes had not been substantively enacted at the reporting date and, therefore, are not recognised in these financial statements.

4 Dividends

5 Earnings per share

The calculation of the basic and diluted earnings per share is based on the following data:

6 Net cash outflow from operating activities

7 RESTRUCTURING COSTS

Restructuring costs are those items the Group considers to be material and which therefore have been disclosed separately. During the year the following restructuring costs were incurred and paid by the Group:

8 DISCONTINUED OPERATIONS

Group profit from discontinued operations comprises the following:

During the year, the Company liquidated two of its Australian subsidiaries, Air Partner Leasing Pty Limited and Air Partner Leasing No. 2 Pty Limited, and a former branch in Japan. In accordance with IAS 21, the cumulative exchange differences relating to these foreign operations and accumulated in the translation reserve were taken to profit on liquidation. This resulted in a gain of £532,000 (2010: £nil).

On 15 March 2010, Air Partner Private Jets Limited, a wholly-owned subsidiary, was put into administration. On that date the control of the subsidiary was passed to the administrators. As a result of this decision, the results of Air Partner Private Jets Limited up to the date of disposal have been classified as discontinued operations in the consolidated income statement in the prior year. An analysis of discontinued operations is presented below:

A loss of £90,000 arose on the administration of Air Partner Private Jets Limited during the prior year, being the loss of net assets at the time of administration (as shown below), less expected return from the administrators of £400,000. In the current year, the Company's estimate of the expected return from the administrators increased to £601,000, based on advice from the administrators. This change in estimate resulted in a profit on disposal of £201,000.

During the year, Air Partner Private Jets Limited contributed a reduction of £575,000 (2010: reduction of £1,336,000) to the Group's net operating cashflows and received £nil (2010: £26,000) in respect of financing activities. The effect of discontinued operations on segment results is disclosed in note 2.