Gama Aviation : FY2022 Annual Report

GAMA AVIATION PLC Company number 07264678

ANNUAL REPORT AND FINANCIAL STATEMENTS 2022

GAMA AVIATION PLC ANNUAL REPORT

FOR THE YEAR ENDED 31 DECEMBER 2022

Our purpose

…is to provide aviation services that enable a decisive advantage.

STRATEGIC REPORT

2022 highlights	2
Chief Executive Officer's statement	5
Strategy	7
Group operational performance review	9
Finance review	15
Principal risks and uncertainties	19
Section 172 statement	23

GOVERNANCE

Board of Directors	27
Corporate governance	29
Directors' Remuneration Report	35
Corporate social responsibility	41
Directors' Report	47

FINANCIAL STATEMENTS

Independent auditor's report	52
Consolidated income statement	59
Consolidated statement of comprehensive income	60
Consolidated balance sheet	61
Consolidated statement of changes in equity	63
Consolidated cash flow statement	64
Notes to the financial statements	66
Parent Company balance sheet	136
Parent Company statement of changes in equity	137
Notes to the Parent Company financial statements	138

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GAMA AVIATION PLC STRATEGIC REPORT

FOR THE YEAR ENDED 31 DECEMBER 2022

Strategic Report

2022 Highlights

Chief Executive Officer's statement

Strategy

Group operational performance review

Finance review

Principal risks and uncertainties

Section 172 statement

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GAMA AVIATION PLC STRATEGIC REPORT

FOR THE YEAR ENDED 31 DECEMBER 2022

2022 HIGHLIGHTS

Gama Aviation Plc is pleased to announce the results for the year ended 31 December 2022.

Financial highlights:

Revenue	Gross profits
$285.6m	$55.0m
Up 21% (2021: $235.9m)	Up 33% (2021: $41.5m)
At constant currency2 up 27% (2021: $224.5m)	At constant currency2 up 41% (2021: $39.1m)
Adjusted EBIT profit1	Statutory loss for the year
$8.8m	$8.6m
(2021: $4.3m loss)	(2021: $8.8m loss)
Net debt1	Net cash inflow from operating activities
$66.4m	$31.4m
(2021: $104.9m)	(2021: $5.2m cash inflow)

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GAMA AVIATION PLC STRATEGIC REPORT

FOR THE YEAR ENDED 31 DECEMBER 2022

Financial summary

	Adjusted1	$m	Statutory $m
	Dec-22	Dec-213	Dec-22	Dec-213
Revenue	285.6	235.9	285.6	235.9
Gross Profit3	55.1	41.5	55.0	41.5
Gross Profit %3	19.3%	17.6%	19.3%	17.6%
EBITDA4	22.9	11.8	19.1	10.1
EBIT	8.8	(4.3)	0.4	(7.3)
Loss for the year	(1.4)	(6.3)	(8.6)	(8.8)
Loss per share (cents)	(2.6)	(8.7)	(13.9)	(12.7)

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The Adjusted Performance Measures (APMs) are defined in Note 15 to the financial statements and reconciled to the nearest International Financial Reporting Standards (IFRS) measure. APMs include Adjusted Gross Profit, Adjusted EBIT and Net Debt.

To aid comparability, a further version of the 2021 results has also been calculated on a constant currency basis using a constant foreign exchange rate of $1.24 to £1, being the cumulative average USD/GBP exchange rate for 2022, instead of the reported exchange rate of $1.38 to £1 for 2021. On a constant currency basis 2021 Revenue is $224.5. Gross Profit is $39.1m, Gross Profit percentage is 17.4%, and Adjusted EBIT is a loss of $4.3m. Refer to Note 15 of the notes to the financial statements for further details.

Depreciation charges of $3.2m in the prior year relating to aircraft and refurbishment, and leasehold property improvements have been

reviewed and reclassified from administrative expenses to cost of sales to be consistent with the current year presentation and to show depreciation of assets used in the delivery of revenues in cost of sales. There has been no change in loss for the year in respect

of the prior year.

EBITDA represents earnings before interest, tax, depreciation, and amortisation. Adjusted EBITDA is Statutory EBITDA before adjusting items.

Financial highlights

• Revenue up 21% (27% at constant currency2) to $285.6m (2021: $235.9m)
• Gross Profit up 33% (41% at constant currency2) to $55.1m (20213: $41.5m)
• Gross Profit Margin up by 1.7ppts (up 2.7ppts at constant currency) at 19.3% (20213: 17.6%)
• Adjusted EBITDA profit up $11.1m to $22.9m (2021: $11.8m)
• Adjusted EBIT profit up $13.1m to $8.8m (2021: $4.3m loss)
• Net cash inflow from operating activities of $31.4m (2021: $5.2m cash inflow). Improvement of $26.2m with $7.7m improvement in EBIT and $14.7m positive contribution from working capital
• Group cash balances were $22.4m (2021: $10.2m) of cash and $9.0m of the Group's US $15.0m revolving
  credit facilities (RCF) (2021: $12.1m of Group $50m revolving credit facilities) was undrawn as of 31 December 2022
• Net debt, inclusive of $52.7m (2021: $48.0m) of lease obligations, decreased to $66.4m (2021: $104.9m).
• As at 7 June 2023 cash balances were $12.5m
• The Board of Directors does not recommend a dividend to be paid

Strategic highlights

• Significant growth and improved profitability in the Group's US Business Aviation maintenance and repair operations ("MRO") business, Jet East
• The award of a seven-year, five aircraft Wales Air Ambulance Charity contract, finalised in February 2023, represents a significant contract win for the group's Special Mission Strategic Business Unit ("SBU") in line with its organic growth plans

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