Drop in pre-tax profits at Aergo

PRETAX PROFITS at Denis O’Brien’s Dublin-based aircraft leasing company, Aergo Capital, dropped by 69 per cent to $2.6 million (€1.9 million) last year.

The fall came despite a three-fold increase in revenues from $49.2 million in 2008 to $150.6 million last year.

In accounts filed with the Companies Office, the company’s directors noted that they were “satisfied with the level of business and year end financial position”.

The results show the group’s profits were hit last year by foreign-exchange losses of $25.7 million. Aergo’s directors stated that before the foreign exchange losses are taken into account, the company’s after-tax profits would have been $27.2 million.

The foreign exchange losses arose mainly from Aergo’s purchase of the South African-based Safair businesses in December 2008. The directors said the group had a significant exposure to foreign currency as a substantial portion of its interest-bearing debt was in South African rand.

Last month, Aergo Capital concluded the sale of its interest in Safair to a Dublin-based company, ASL Aviation. This involved the sale of about $250 million of assets, including Safair, 13 jet aircraft and a 28 per cent stake in maintenance associate Jetworx.

It is understood that ASL paid less than $100 million to buy the business in an all-cash transaction. It also assumed the liabilities attached to the aircraft.

The Aergo accounts show that it acquired Safair in December 2008 for $80 million in cash. Aergo Capital Ltd’s accounts show that the Safair Group recorded pre-tax profits of $6.5m for 2009.