20 Jul 2011 07:00
AIR PARTNER PLC
("Air Partner", "the Group" or "the Company")
The Board of Air Partner plc, the leading supplier of air charter services to corporates, governments and high net worth individuals, has today issued the following statement:
Air Partner has notified the Internal Revenue Service of the United States ("IRS") of a potential liability relating to Federal Excise Tax ("FET") due on certain flights. The potential liability relates to certain past flights contracted by Air Partner plc outside the US but involving a US destination. The Company and its US tax advisors are in preliminary discussions with the relevant authorities to understand and resolve any outstanding payments.
At this early stage, the Company estimates the financial liability is likely to be in the region of £1 million. A provision for this liability will be made in the current financial year. Procedures within the Company have now been changed on the instructions of the current management team to ensure no further liabilities are created.
There has been no change in trading levels since the interim management statement issued on 7 June and, as indicated at that time, general trading performance has remained positive. However, profit before tax for the full year to 31 July 2011 will be reduced as a result of the exceptional tax provision for settlement of the FET liability. Excluding the provision for FET liability, underlying trading remains positive, and the Group's focus on its core strategy continues to make good progress.
The Board is not aware of any other legacy issues but, as a prudent step, Air Partner has appointed a top four accountancy firm to review control procedures and provide an independent additional assurance. There have already been significant improvements in processes and reporting procedures and Air Partner has significantly strengthened its financial management team over the past twelve months, with the appointment of Gavin Charles as CFO in July last year, Jim Bowden as Group financial controller in March 2011, and Andrew Wood, former CFO of BBA Aviation plc who joined the Board as a non-executive director in June of this year.
20 July 2011
Enquiries:
Air Partner 01293 844 788
Mark Briffa, CEO
Gavin Charles, CFO
Temple Bar Advisory 0207 002 1080
Tom Allison