Aviation services company, Air Partner, is one of the few companies in its industry to have successfully withstood the impacts of the Covid-19 pandemic and to emerge in a stronger position. The diversity of the group’s operations has given the company a unique advantage in some of the most challenging market conditions and it looks set to thrive with the re-emergence of international travel.
Providing charters for commercial aircraft and freight services, Air Partner played a key role in the international response to the Covid-19 pandemic. Not only was the company involved in global repatriation and evacuation efforts, but it was also able to ensure that critical healthcare supplies were delivered in a timely manner around the world. This enabled the company to still turn a profit in one of the worst affected industries.
Whilst revenues from the Group Charter and Freight divisions are now beginning to fall, Air Partner is seeing heightened levels of demand for its Private Jet division once more as travel restrictions continue to ease.
After a £7.5 million equity raise last year to strengthen the balance sheet and take advantage of market opportunities, the company has continued to make strategic acquisitions to enhance and diversify its unique business offering, and fortify its competitive moat.
However, given the company’s limited organic growth in recent years and its dwindling Covid-19 related revenues, will Air Partner’s share price continue its ascent?
Profile
What are the company's principal business activities, how does it generate its revenues/profits?
Air Partner's 4 key business segments fall under Private Jets, Group Charter, Freight and Safety & Security.
The Private Jets division offers charters for smaller aircraft (up to 19 people), which are typically used by corporates or high-net-worth individuals. Through the company’s JetCard membership programme, which offers greater flexibility and perks for private jet charters, the company is able to generate lots of repeat business from regular flyers.
The Private Jet division currently accounts for the largest portion of the company's profits, after a surge in bookings over the last 6 months, particularly in the UK and US. The Gross Profit by Division contribution (from the company’s H1 2021 interim results) can be seen below.
Source: Air Partner H1 2021 Results Presentation
During the initial outbreak of the Covid-19 pandemic,…
