Oasis Leasing posts AED 4.685m 2003 profit result reflects improved business climate

The latest figures continue the trend set in the first half of 2003 when the company posted net profits of AED 3.4 million. Revenue and gross and operating profits also improved year on year, while operating and administrative costs were reduced.

Oasis Leasing says the figures reflect the generally improving business climate in the aviation industry and increased activity in the leasing sector.

"Last year was an eventful year," said Mohammed Saif Al-Mazrouei, Chairman, Oasis Leasing. "The war in Iraq and SARS negatively affected business confidence and as a result global economic recovery was hesitant during the first half of 2003.

However, the second half was more stable and there are signs that the bottom of the trading cycle has been reached and a tentative recovery is underway in the aviation industry. Passenger volumes are recovering in those parts of the world hardest hit and airlines are slowly regaining confidence.

There is surely no better evidence of this renewed confidence than recent developments in the UAE's aviation sector. Oasis Leasing is working very hard to ensure that we play a role in the growth, development and prosperity of exciting new ventures like Etihad and Royal Jet," Al-Mazrouei added.

Gordon Dixon, Oasis Leasing's CEO, said despite the tough business climate in 2003, the company was able to keep all its assets generating revenue.

"This was a real achievement in the light of the market conditions," he said. "Cash inflow from operating activities not only exceeded 2002 but also 2001 levels, a clear demonstration that we continued to drive value from the asset portfolio even during the down cycle."

During 2003 Oasis Leasing successfully managed the return and onward lease of four aircraft to new customers and also extended three leases with existing customers. The company re-financed five aircraft and successfully renegotiated the leases and financings of four aircraft with Air Canada. Five new assets were added to the company's portfolio and it also profitably traded some aviation based financial investments.

"We have always made a point of emphasising the cyclical nature of our industry and that different asset types have different cycles," Dixon said. "Whilst aviation has been going through a down cycle, making acquisitions more attractive than disposals, shipping can be said to be the opposite of this.

"Consequently, as 2003 drew to a close we took advantage of the buoyant nature of the dry bulk market and sold our Capesize vessel in January. This will be reflected in the first quarter of 2004."

Dixon confirmed Oasis Leasing' board had decided not to recommend a dividend payment to shareholders for 2003. "The directors took the view the shareholders' long term interests are best served by reinvesting profits for longer term gain."