Why Alliance Aviation (ASX:AQZ) shares jumped over 60% in 12 months

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Why Alliance Aviation (ASX:AQZ) shares jumped over 60% in 12 months

 Why Alliance Aviation (ASX:AQZ) shares jumped over 60% in 12 months

Summary

  • The Alliance Aviation (ASX:AQZ) shares are in high demand among investors after the release of half-yearly earnings update on Wednesday. 
  • The shares of Alliance Aviation have jumped 63 per cent in the last 12 months. 
  • The 72 per cent jump in the underlying profit before tax (PBT) to A$26.7 million was in line with the company’s half-year guidance. 

The Alliance Aviation Services Ltd (ASX:AQZ) shares are in high demand among the investors after the release of half-yearly earnings update on Wednesday. The company reported profit growth on higher-margin contract and charter flights, which counterbalanced weaker wet lease and RPT revenues. Even the company’s operating cash flow is healthy. The robust earnings come at a time when coronavirus pandemic significantly impacted the sector’s overall business.

The shares of Alliance Aviation have jumped 63 per cent in the last 12 months. On Thursday, 11 February 2021, the stock closed at A$4.37, up 0.0100 points, or 0.23 per cent, against the previous closing on Wednesday, 10 February 2021. The YTD returns for the stock stand at 17.5 per cent.

Image Source: © Moth | Megapixl.com

Alliance Aviation reported a 2.3 per cent rise in total revenue to A$154.8 million and a 116.8 per cent surge in profit before tax (PBT) to A$33.6 million for the six months ended 31 December. The 72 per cent jump in the underlying profit before tax (PBT) to A$26.7 million was in line with the company’s half-year guidance. Similarly, operating cash flow was recorded at A$47.5 million, a 225 per cent rise from the corresponding period last year. The company’s net debt stood at $6.8 million during the period.

Image Source: © Spectruminfo | Megapixl.com

Management commentary

Commenting on the results, Alliance’s Managing Director, Scott McMillan, said that the company was expected to grow further going ahead on account of the robustness in its business model, the commitment of our staff and the relationship with its clients.

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Outlook

Alliance Aviation did not provide any guidance for the full year in its latest update. However, the management remains upbeat on its outlook for FY21 and FY22 since it has deployed additional aircraft.

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