BOC Aviation : Financial Statements/ESG Information - 2022 INTERIM REPORT

WELL POSITIONED

AS GROWTH RECOVERS

2022 INTERIM REPORT

BOC Aviation recorded core net profit after tax of US$206 million in the first half of 2022, excluding the impact of the write-down of the net book value of the 17 aircraft that remain in Russia. Including the write-down, we reported a net loss after tax of US$313 million or a loss per share of US$0.45.

The Board of Directors has approved a distribution of US$0.0889 per share by way of interim dividend, which represents 30% of our core net profit after tax. This is the same proportion of net profit after tax that we distributed as an interim dividend in prior years and demonstrates the Group's strong cash flow and the Board's confidence in the strength of its underlying business.

In the first half of 2022, we saw robust recovery in the world's airline and travel sectors. According to the International Air Transport Association, total global passenger traffic rose 83% in the six months to June 2022 compared with the prior year and has now reached 71% of 2019 levels, with the recovery most notable in the Americas, Western Europe and the Middle East. We expect further recovery when China and Japan fully resume international travel.

This has become evident in our airline customers' better earnings and cash flow during the first half of 2022, which has sustained our collections, as these rose to 97% from 96% the previous year. Operating cash flow net of interest also rose, up 29% to US$717 million and we ended the half year with liquidity in the form of cash and available credit lines largely unchanged at US$6.0 billion.

During the first half of 2022, we placed the largest single aircraft order by value in our Company's history when we committed to purchase 80 Airbus A320NEO family aircraft, which will support future revenues and position us well as growth recovers.

BOC AVIATION LIMITED INTERIM REPORT 2022

CONTENTS

02 Financial Overview

04 Portfolio and Operational Overview

10 Half Year Business Review

1. Business Overview
2. Management Discussion and Analysis

27 General Information

1. Corporate Information
2. Definitions
   Appendix - Interim Condensed Consolidated Financial Statements

01

BOC AVIATION LIMITED INTERIM REPORT 2022

FINANCIAL OVERVIEW

Our financial overview for the six months ended 30 June 2022 are:

• Total revenues and other income increased 8% to US$1,196 million compared with the first half of 2021
• Operating cash flow net of interest increased 29% to US$717 million compared with the first half of 2021
• Net loss after tax of US$313 million, compared with net profit after tax of US$254 million in the first half of 2021. This included write-downs of US$804 million related to the net book value of aircraft remaining in Russia partially offset by US$223 million of cash collateral held by the Group in respect of those aircraft and US$63 million of tax credit, resulting in an after-tax impact of US$518 million
• Loss per share of US$0.45
• Interim dividend of US$0.0889 per share
• Total assets decreased 4% to US$22.8 billion as at 30 June 2022 compared with 31 December 2021, primarily on account of the write-down of the net book value of aircraft remaining in Russia
• Maintained strong liquidity with US$454 million in cash and short-term deposits1 in addition to US$5.5 billion in undrawn committed credit facilities as at 30 June 2022

1Includes encumbered cash and cash balances of US$3.2 million.

Capitalised terms used but not defined in this interim report are found in pages 34 to 35.

Due to rounding, numbers presented throughout this interim report may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures.

02

BOC AVIATION LIMITED INTERIM REPORT 2022

FINANCIAL OVERVIEW

	Unaudited
	6 months ended 30 June
	2022	2021
	US$m	US$m
Statement of Profit or Loss
Revenues and other income	1,196	1,107
Costs and expenses	(1,543)	(820)
(Loss)/Profit before income tax	(347)	288
Net (loss)/profit after income tax	(313)	254
(Loss)/Earnings per share (US$)1	(0.45)	0.37
	Unaudited	Audited
	30 June	31 December
	2022	2021
	US$m	US$m
Statement of Financial Position
Cash and short-term deposits2	454	486
Total current assets	679	673
Total non-current assets	22,133	23,207
Total assets	22,813	23,879
Total current liabilities	2,815	2,206
Total non-current liabilities	15,077	16,408
Total liabilities	17,893	18,613
Net assets	4,920	5,266
Financial Ratios
Net assets per share (US$)3	7.09	7.59
Gross debt to equity (times)4	3.3	3.2
Net debt to equity (times)5	3.2	3.1

1

2

3

4

5

(Loss)/Earnings per share is calculated by dividing net (loss)/profit after tax by total number of shares outstanding at 30 June 2022 and 30 June 2021. Number of shares outstanding at 30 June 2022 and 30 June 2021 was 694,010,334.

Includes encumbered cash and bank balances of US$3.2 million and US$1.2 million at 30 June 2022 and at 31 December 2021, respectively.

Net assets per share is calculated by dividing net assets by total number of shares outstanding at 30 June 2022 and 31 December 2021. Number of shares outstanding at 31 December 2021 was 694,010,334.

Gross debt to equity is calculated by dividing gross debt by total equity at 30 June 2022 and 31 December 2021. Net debt is defined as gross debt less cash and short-term deposits. Net debt to equity is calculated by dividing net debt by total equity.

03