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November 2017

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GMF AeroAsia has officially listed its shares on the Indonesia Stock Exchange, the first MRO company in Indonesia to go public. GMF offered 2,823,351,100 new shares, or 10% of the company’s issued and paid-up capital after its IPO, at a price of IDR400. In total, GMF raised IDR1,129,340,440,000. GMF oversubscribed its shares 2.6 times by the end of the public offering period. Around 60% of the net proceeds will be invested for capital expenditure, 25% for working capital, and the remaining amount will be used for refinancing.

 

Aircraft facilities planned in Batam, Australia, East Asia, and the Middle East will be the first to receive funding, and it will soon increase its capability in airframes, components, and engines, along with training.

 

GMF has a strong financial record as of fiscal year 2016. GMF’s EBITDA margin of 26% is noted as one of the highest in the MRO industry, and revenue growth has consistently reached double digits for the last three years – 27.18% last year. GMF revenue in 2016 reached $389 million, with net income at $57.7 million, a 15% profit margin growth. Measured by revenue, GMF is currently the 13th largest MRO in the world.

 

In 3Q17, revenue was $310.5 million, up 15% from a year ago and was 73.2%of the overall target for the end of 2017of $424 million. Net profit was $38.1 million, up 8.9% from 3Q16. This was attributed to the greater volume of engine maintenance and component maintenance work, which is also the focus of GMF’s business expansion in 2017. Revenue growth contributed by component maintenance business line was 25%, with 18% at airframe maintenance and 15% at engine maintenance.

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ST Aerospace secured new contracts worth about S$530 million in 3Q17. The heavy airframe maintenance contracts include long-term agreements to support a range of aircraft platforms from McDonnell Douglas MD-11, Boeing 777 and Boeing 757 to Airbus A300 for freight operators. Other MRO contracts clinched in 3Q17 include agreements to service CFM56-7B engines for European and Asian airlines, as well as agreements to overhaul the landing gears of commercial and military aircraft.

 

ST Aerospace further grew its cabin retrofit business and secured a launch customer for its aircraft seats when it won a contract from an aircraft leasing company to refresh and reconfigure the cabin interior of two A320 aircraft. ST Aerospace will be installing its in-house designed seat, which is tailored specifically for narrowbody aircraft and medium-haul flights, when refreshing the cabin interior of the two aircraft. At just under 11kg, the new seat is among the lightest in its class. Apart from helping airlines to save fuel and operating cost, innovative features – such as an articulating seat pan that allows for large shin clearance – have been incorporated into the design to provide maximum space and comfort for passengers.

 

The aerospace sector redelivered a total of 1,134 aircraft for airframe maintenance and modification work in 3Q17. Additionally, a total of 11,509 components, 65 landing gears and 34 engines were processed, while 2,565 engine washes were conducted.

 

The sector continued to expand its capabilities when its airframe MRO station in Guangzhou, China, received approval by the Civil Aviation Authority of Malaysia to provide maintenance service for Boeing 767, while its VIP completion and refurbishment business, AERIA Luxury Interiors, registered successfully for an independent repair certification with the Federal Aviation Administration, allowing the company to streamline its completion process, and expedite its maintenance, refurbishment and completion contracts in the most efficient way possible.

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ST Engineering has announced that its aerospace VIP completion and refurbishment business division based in San Antonio, TX, US has been incorporated as a subsidiary, AERIA Luxury Interiors, by VT San Antonio Aerospace, with a paid-up capital of $1. As an incorporated company, AERIA will tailor its processes to be focused on the completion business, thereby increasing its competitiveness.

 

With the incorporation, AERIA will also start to operate under its own Part 145 Repair Station certificate issued by the FAA instead of operating under parent company VT SAA’s certificate. Establishing an independent FAA repair certification allows AERIA to streamline its completion process, and expedite its maintenance, refurbishment and completion contracts in the most efficient way possible. At the same time, as AERIA remains a part of VT SAA’s facility and ST Aerospace’s global network, it will continue to leverage and benefit from the synergy in operations and marketing.

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