Press Release

BOC Aviation Achieves Record Net Profit after Tax of US$107 Million

30 Mar 2009

BOC Aviation recorded a net profit after tax of US$107 million for 2008, 32% higher than the US$81 million earned in the previous year.  This is the first year that BOC Aviation has achieved a net profit after tax of more than US$100 million.

The Company attained the solid performance from the implementation of its plan for the downturn.  It was a net seller of aircraft in the first half of the year and a strategic buyer in the final quarter as competition reduced.  Throughout the year, continued emphasis was placed on forward placements of its own orders with airlines.  With this successful strategy, BOC Aviation ended the year with only one new aircraft due to be placed in 2010.  Thereafter, the next new aircraft is available in May 2011. 

BOC Aviation recorded higher lease rentals from a bigger portfolio as forward placements of aircraft on long-term leases in previous years generated a steady stream of rental revenue.  The Company took delivery of a total of 26 aircraft during the year, of which 13 were delivered in the last quarter.  Continued financial discipline to keep operating costs under control and lower prevailing interest rates also contributed to the improved profit figure. 

The Company took advantage of favourable market conditions in the first half of the year to sell 12 aircraft.  With a well-balanced portfolio, BOC Aviation’s fleet remains one of the youngest in the industry with an average fleet age of four years and comprises a broadly diversified base of carriers in all major continents.  At year end the Company had a portfolio of 92 aircraft, 73 owned and 19 managed, and an order book of 71 aircraft. 

Reflecting on the financial performance, Robert Martin, Chief Executive Officer and Managing Director of BOC Aviation, said “Global economic and financial upheavals during 2008 presented a set of unprecedented challenges for the aviation industry. With a dynamic and forward-looking strategy, we were able to achieve this significant profit milestone in our company’s history.  Our balance sheet remains robust with a debt to equity ratio of less than 3.5:1.  As of 31 December, we have a strong cash position and backstop lines of US$855 million available.  We are well positioned to handle the challenges and opportunities of a downturn.”

BOC Aviation is the leading Asia-based aircraft leasing company with a portfolio of 105 modern aircraft operated by airlines worldwide. In addition, the company has 70 aircraft on firm order for delivery through to 2013. 

BOC Aviation is 100% owned by Bank of China, the third largest bank in the world*.

*Based on market capitalization as at 27 March 2009.