AIRCRAFT leasing group GPA has returned to profit in the year to the end of March. But the bulk of the profits are accounted for by non-recurring exceptional gains on its $4.5 billion (£2.78 billion) aircraft securitisation and the sale of small stakes in two American airlines.

In the year to the end of March, GPA had a net profit of $54 million, made up almost totally of a $34 million gain on the ALPS aircraft securitisation package completed last year and an $18 million gain on the sale of the stakes in the two airlines.

The completion of the securitisation, which saw GPA sell 229 aircraft to the ALPS special purpose vehicle for $4.5 billion, meant that GPAs debt was cut from $4.65 billion to $1.57 billion, while the group's cash balances jumped from $355 million to $1.28 billion.

The fall in total assets from $6.1 billion to $2.4 billion reflects the sale of the 229 aircraft.

When GPA was rescued from collapse by GE Capital in 1993, GPA's debts and most of its fleet of aircraft were left with the company, while a GE subsidiary, GE Capital Aviation Services, bought 35 aircraft from GPA for $1.3 billion.

GPA's job after the rescue was to realise as many assets as possible to pay off the group's huge debt mountain.

While the completion of the ALPS securitisation was the main focus during the year, GPA's chief executive, Mr Patrick Blaney, said the core leasing business was much improved.

The number of non-revenue-earning aircraft and the cost of defaults were reduced and lease rates continued to improve.

"These trends, should they continue, will result in new leases at higher rates and, therefore, should contribute to an improved performance over time," said Mr Blaney.

"GPA's results for the year to March 31st, 1997, will reflect the much reduced number of aircraft in its portfolio," said Mr Blaney.