Airline Services ‘back on track’ after setbacks

SALES at Airline Services and Components Group, the private equity-backed company which cleans, maintains and de-ices aircraft, rocketed last year, but problems in one of its divisions pushed it into the red.

Turnover at the company soared from £33.6m to £61.5m, but an operating loss of £187,067 was reported for the year to the end of October 2013, compared with a profit of £1.17m the previous year.

After interest payments of £3.6m related to the group’s borrowings, ASCG posted a bottom-line line loss of £4.5m, compared with a loss of £902,407 in 2012.

The group reported two other significant exceptional items – one for £580,088 was related to implementing a new ERP system and a smaller sum, £169,211 related to redundancy and legal costs following a “restructuring exercise”.

The Sharston-based company, backed by LDC, has had a somewhat turbulent year – long-serving chief executive Bryan Bodek left the business in June to be replaced by experienced aviation sector executive Mike Humphreys.

The company is made up of three divisions,  Ramp Operations, Approved Workshop and Soft Furnishings. It  said there had been change in the period, in terms of leadership and also “significant investment of resources to repair issues in the Approved Workshop division.”

In January a new MD, Martin Barnes, was appointed to the Approved Workshop division and the group said this had already led to a improvement. “Under his leadership the division has made great strides, streamlining the operation and returning the business to a sound and profitable base.”

The group said its Ramp Operations division had seen a record year as a result of high demand for de-icing and its components business had had a good year too. However the Approved Workshop had “issues of rapid over-expansion and consequential project management difficulties affected profitability badly in the second half of the financial year 12/13.”

Writing in the annual accounts just filed at Companies House, finance director Sean Taylor said the group is now back on track and the “mid-term outlook is now extremely positive.”

“In summary, the business, specifically Approved Workshops division, has suffered setbacks during FY12/13. And we are extremely grateful to our shareholders for unreservedly backing the new management team to turn things around and put the business back on track.”