A high-value aircraft leasing company that is rapidly gaining popularity

Annual adjusted pre-tax profit increased 80 percent to $40.8 million
An increase in the fair value of aircraft rights by $47 million
Analysts are significantly increasing earnings estimates for 2025 and 2026
50% discount to immediate net asset value (NAV) of 271p

Annual results of an aircraft leasing company Aviation (AVAP: 135.5p) received a turbo boost from profits from aircraft rights.

This happened because Avation exercised its rights to purchase 10 new aircraft from manufacturer ATR and restructured its aircraft purchasing plan. This resulted in the granting of new rights to purchase six aircraft and the extension of existing rights for 24 aircraft until 2034, i.e. during the period of recovery of global air traffic. In fact, global travel demand is now exceeding pre-pandemic levels, with aircraft manufacturer Airbus predicting airline operating profit this year will be the highest since 2016. Well-documented constraints on new aircraft deliveries and maintenance issues on both Airbus and Boeing means that leasing rates on some aircraft are also now above 2019 levels.