Wednesday 05 December 2018 by FIIG Research General

Company updates – Ansett Aviation Training

This week, we provide an update on Ansett Aviation Training FY18 results

Ansett Aviation Training FY18 update (AAT)

We revise our credit outlook on AAT and reiterate our recommendation on its 7.50% notes due 2020.

  • AAT has provided its audited FY18 accounts. While revenue of AUD20.5m was higher than our forecast of AUD18.6m, increased operating expenses led to a reduction in margin and slightly lower than expected EBITDA of AUD10.9m (FY18F: AUD11.2m).
  • However net debt was AUD3.7m lower than our forecast ending the year at AUD40.8m. This translated to a better than expected leverage ratio of 3.7x compared to a forecast of 4.0x. Interest coverage was 2.7x, compared to our forecast of 3.0x.
  • Given the improved top line performance, and expectations of margins returning to more historic levels we expect EBITDA to be about AUD1m higher in FY19 and FY20 compared to the prior forecast at AUD12.8m and AUD13.0m respectively.
  • Although AAT’s Notes are unsecured and non-amortising, we believe that AAT’s revenue is more predictable than its peers, as the revenue is based on medium- to long-term ‘use or pay’ or exclusive contracts.

The full update is available here on the FIIG website available to all investors.



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