INTERNATIONAL. Inflight services provider gategroup has reported a solid set of first-half results, with increased profitability against stable revenues, despite a tough trading environment for aviation.
The company also added some key contracts to its portfolio, including the inflight retail programme at Brazilian carrier GOL.
Reported H1 revenue rose marginally (+0.1%) to CHF1,318.7 million (US$1.8 billion). At constant exchange rates, revenue rose by +14% year-on-year.
EBITDA for the period hit CHF88.4 million (US$121 million), down by -4.7% reported, and up +9.7% at constant currency rates. The company had an EBITDA margin of 6.7%, down by 0.3 percentage points reported, and down by 0.2 percentage point in constant currencies.
Its operating profit was CHF49.1 million (US$67.2 million), up +24.3% reported, or +44.6% in constant currencies. Profit for the period hit CHF20.1 million (US$27.5 million), up by +116.1%.
The company noted: “gategroup has seen year-over-year growth for the airline industry, its largest customer base, despite concerns that emerged earlier in the year. These included a sharp spike in oil prices; the triple earthquake/tsunami/nuclear disasters in Japan; smaller natural disasters in Australia and New Zealand; civil uprisings in the Middle East and flight disruptions due to volcanic activity in Europe and South America.”
Newly appointed CEO Andrew Gibson said: “gategroup continues to deliver to expectations despite these challenging, but transient, conditions. Historically our business is stronger in the second half, and we are optimistic the effects we have seen in the first half will be further mitigated as the year unfolds.”
New business in the period included a system-wide agreement to manage Brazil low-cost carrier GOL’s onboard retail programme. It also added Delta Air Lines as the fourth customer of the new Gate Gourmet unit at Tokyo Haneda Airport.
“gategroup continues to demonstrate its ability to manage a difficult environment with its resilient business model,” Gibson said. “Looking ahead to the second half of the year, we remain cautiously optimistic.”
Barring any unforeseen events, gategroup targets full-year revenue in 2011 of approximately CHF3.0 billion (US$4.1 billion) on a 2010 constant currency basis, with an EBITDA margin of around 8%.
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About gategroup
gategroup is a leading independent global provider of onboard products, services and solutions to airlines and railways. It comprises 11 member brands, which are deSter, eGate Solutions, Elan, Gate Aviation, Gate Gourmet, Gate Safe, Harmony, Performa, potmstudios, Pourshins and Supplair.
