DAE announces Financial Results for the six months ended June 30, 2021
Dubai, U.A.E., 4 August 2021 – Dubai Aerospace Enterprise (DAE) Ltd today reported its financial results for the six months ended June 30, 2021. The consolidated financial statements can be found here.
Selected Financial and Operating Highlights:
- Total Revenue: US$613.4 million (H1 2020: US$675.9 million)
- Adjusted Profit Before Tax: US$67.3 million (H1 2020: US$131.9 million)
- Operating Cash Flow: US$498.5 million (H1 2020: US$432.2 million)
- Unsecured Debt as a percentage of Total Debt: 70.8% (Year-end 2020: 62.6%)
- Available Liquidity: US$4,099.0 million (Year-end 2020: US$2,693.0 million)
- Fleet Utilization: 99.1% (Year-end 2020: 98.2%)
- Collection rate[1]: 89% (H1 2020: 83%)
- Credit Outlook revised up to ‘Stable’ by Moody’s and Fitch
- Inaugural ESG Report published with FY2021 and FY2025 ESG Targets
- Committed to purchase 26 and sell 27 aircraft
- Increased available liquidity to US$4.1 billion from US$2.7 billion at year-end 2020
- Redeemed approximately US$456 million of high coupon debt in March 2021 and announced for early redemption an additional US$1.25 billion in August 2021
Commenting on the results, Firoz Tarapore, Chief Executive Officer of DAE, stated, “Our financial results for the first half of 2021 reflect strong origination of new technology, fuel-efficient narrow body aircraft and a robust environment for sales of aircraft assets. We placed a direct order with Boeing for up to 15 737-8 MAX aircraft to meet our customers’ requirements for modernizing and upgrading their fleets.
"Recovery in passenger air traffic demand is progressing well but not evenly in all jurisdictions and for all aircraft types. The uneven nature of vaccine deployment geographically and the emergence of virus variants remains a barrier to a predictable return to full normalcy. We remain optimistic and vigilant. Our balance sheet stays strong with high levels of capital adequacy and exceptional levels of available liquidity.”
Webcast and Conference Call
In connection with DAE’s second quarter 2021 earnings release, management will host a conference call on August 4, 2021 at 09:00 EDT / 14:00 BST / 17:00 GST / 21:00 SGT.
The call can be accessed live by clicking here from your laptop, tablet, or mobile device, or by dialing one of the global dial-in numbers and using the following access code: 2145801.
Full details of the call can also be accessed live via the link on DAE’s website:
www.dubaiaerospace.com/investors.
Forward Looking Statements
Certain information contained in this Press Release may constitute “forward-looking statements” which can be identified by the use of forward-looking terminology such as “may”, “will”, “should”, “could”, “continue”, “expect”, “anticipate”, “predict”, “project”, “plan”, “estimate”, “budget”, “assume”, “potential”, “future”, “intend” or “believe” or the negatives thereof or other comparable terminology. These statements reflect DAE’s current expectations and assumptions and involve known and unknown risks regarding future events, results or outcomes and are not guarantees of future results or financial condition. Actual results, performance, achievements or conditions may differ materially from those in the forward‐looking statements and assumptions as a result of a number of factors, many of which are beyond DAE’s control.
Non-IFRS Financial Information
This Press Release may include certain non-IFRS financial information, such as Adjusted EBITDA, not prepared in accordance with IFRS. Because of the limitations of Adjusted EBITDA, it should not be considered as a substitute for financial information prepared or determined in accordance with IFRS, as applicable. Where applicable, DAE compensates for these limitations by relying primarily on its IFRS results and using Adjusted EBITDA only for supplemental purposes.
[1] Collection Rate is defined as the sum of all cash collected from lease rentals as a percentage of the total contracted receivables due for the period after incorporating the effect of any lease amendment or deferral agreements executed as of June 30, 2021.
Results of Operations
The following discussion of our results of operations is based on the condensed consolidated statement of profit or loss and other comprehensive income and consolidated statement of financial position which have been extracted from our financial statements for the six months ended June 30, 2021.
| Results of operations (in millions of USD) | Six months ended Jun 30 | |
| 2021 | 2020 | |
| Consolidated statement of profit or loss and comprehensive income | ||
| Total revenue | 613.4 | 675.9 |
| Gain on disposal of aircraft | 29.2 | 9.9 |
| Expenses | ||
| Depreciation and amortization | (287.2) | (279.9) |
| General and administrative expenses | (36.5) | (38.5) |
| Cost of providing engineering maintenance services | (31.9) | (22.5) |
| Loss allowance | (35.7) | (27.9) |
| Aircraft maintenance | (10.8) | (9.0) |
| Operating profit | 240.5 | 308.0 |
| Finance income | 3.2 | 10.0 |
| Finance expense | (176.4) | (186.1) |
| Debt redemption costs | (16.1) | - |
| Net finance costs | (189.3) | (176.1) |
| Profit before income tax | 51.2 | 131.9 |
| Income tax expense | (2.2) | (10.2) |
| Profit for the period | 49.0 | 121.7 |
| Add back debt redemption costs | 16.1 | - |
| Adjusted profit for the period | 65.1 | 121.7 |
| As at | ||
| Consolidated statement of financial position (Extract) | Jun 30, 2021 | Dec 31, 2020 |
| Total cash and cash resources | 1,613.3 | 566.5 |
| Aircraft held for lease | 11,497.2 | 11,321.0 |
| Total assets | 14,284.1 | 12,742.5 |
| Total loans and borrowings | 9,515.3 | 7,907.2 |
| Total equity | 2,964.8 | 2,891.1 |
| Total liabilities and equity | 14,284.1 | 12,742.5 |
| Six months ended Jun 30 | ||
| Adjusted EBITDA calculation P(1) | 2021 | 2020 |
| Profit for the period | 49.0 | 121.7 |
| Add back | ||
| Net finance costs | 189.3 | 176.1 |
| Income tax expense | 2.2 | 10.2 |
| Loss allowance | 35.7 | 27.9 |
| Depreciation and amortization | 287.2 | 279.9 |
| Adjusted EBITDA | 563.4 | 615.8 |
| As at | ||
| Financial metrics | Jun 30, 2021 | Dec 31, 2020 |
| Pre-tax margin (per cent) (2) | 8.3 | 19.2 |
| Pre-tax return on equity (per cent) P(3) | 3.5 | 8.4 |
| Net debt to equity (times) P(4) | 2.69x | 2.57x |
| Total available liquidity (USD billions) (5) | 4.1 | 2.7 |
| Unsecured debt/total debt (per cent) (6) | 70.8 | 62.6 |
| Liquidity coverage ratio (per cent) (7) (8) | 238.0 | 235.2 |
All financial information above has been rounded for presentation purposes. Any percentages are based on unrounded figures.
- We define Adjusted EBITDA as profit, excluding net finance costs, loss allowance for financial assets, income tax expense and depreciation and amortization.
- Calculated as profit before income tax divided by total revenue.
- Calculated as profit before income tax (annualized in the case of interim periods) divided by average total equity.
- Calculated as net debt (being total loans and borrowings, net of debt issuance costs less cash and cash equivalents) divided by total equity.
- Calculated as the sum of available revolving credit and cash and cash equivalents.
- Calculated as unsecured loans and borrowings divided by total bank loans.
- Calculated as total available liquidity divided by recourse debt payments.
- Liquidity Coverage Ratio for June 30, 2021 has been adjusted to exclude the approximately US$1.25 billion in Senior Notes that have been announced for redemption, which are due to be redeemed on August 02, 2021