GPA Group has reported profits after tax of $2 million (£1.37 million) for the three months to the end of June, down from $15 million in the corresponding quarter of 1996. The drop in profits reflected a fall in revenue, down to $74 million from $94 million, a loss of $4.6 million on the value of derivative transactions and a maintenance bill of $5 million on one aircraft. Profits before interest and tax fell to $14 million from $36 million.
The fall in revenue to $74 million partly reflected the restructuring of lease-in obligations on 12 A320 aircraft which were subleased to America West Airlines. But first-quarter revenue was helped by a $12 million injection from the sale of aircraft, up from $500,000 in 1996.
Net interest costs fell to $4 million from $7 million, reflecting repayments of debt which was down to $710 million from $1.194 billion at the end of June 1996. Borrowings were reduced by $47 million in the three months. GPA's net cash outflow from operating activities for the three months was $3 million, compared with an inflow of $5 million.
The outflow for the quarter included a $7 million payment required as part of the restructuring agreement on the A320 aircraft.
End-June cash balances of $523 million included $191 million of restricted balances.
In a statement, chief executive Mr Patrick Blaney, said the results were "in line with expectations and reflect the continuation of both the favourable aircraft leasing markets and our ongoing efforts to strengthen GPA's financial position".
