Founder and CEO of aircraft giant Avolon to step down

Jet lessor Avolon’s founding chief executive, Dómhnal Slattery, is to step down as chief executive later this year.

r Slattery set up the firm 12 years ago after a career in aviation financing with Guinness Peat Aviation and GECAS.

He also set up his own advisory and investment firm, International Aviation Management Group, and private equity firm Claret Capital, which he sold to investors.

He is leaving to “pursue a range of other interests in a non-executive capacity”, Avolon said. Mr Slattery is non-executive chairman of UK firm Vertical Aerospace, with whom Avolon signed a $2bn deal last year for 500 electric air taxis. He is also part-owner of a pub in Liscannor, Co. Clare.

One of Avolon’s other co-founders, Andy Cronin, the current president and chief financial officer, will assume the role of CEO designate.

“I am proud to step away from Avolon, leaving the business in a strong financial and competitive position, and in the hands of a leadership team which I know will continue to excel,” Mr Slattery said.

Chief commercial officer Paul Geaney, also a founding member of the firm, will take over as president with immediate effect.

The leadership change comes a year after Avolon announced the retirement of former president and chief commercial officer, John Higgins, and ex-chief operating officer, Tom Ashe.

Both were founding members of the company.

Since it was set up in 2010, Avolon has grown from a private equity-backed start-up into the second-largest aircraft leasing firm in the world, with over $30bn in assets.

As of the end of June it owned and managed fleet of 591 aircraft, with orders and commitments for 260.

It has 146 airline customers in 62 countries, according to its second quarter results.

In the six months to June, Avolon recorded a net income loss of $173m (€171m), rising to a gain of $86m (€85m) when Russia is excluded.

The firm has ceased operations in Russia since President Vladimir Putin declared war on Ukraine in February, with 10 planes grounded in the country as of March.

Avolon currently has total assets worth just under $30.5bn (€30.1bn), $391m down on its full-year 2021 valuation.

In the three months to June, Avolon recognised $539m of lease revenue and executed a total of 54 lease transactions.

It entered into letters of intent for the sale and leaseback of 13 aircraft and the placement of 31. It sold two of its owned aircraft and entered into binding sale agreements for 30.

Avolon generated $305m in net cash from operating activities.

It ended the quarter with over $16bn of unencumbered assets and net leverage of 2.4.

Ratings agency Fitch has reaffirmed Avolon’s credit rating at BBB- with a stable outlook.

As of the end of June, it had $6.7bn in total available liquidity and contracted sales, including $4.9bn in undrawn debt facilities.

Avolon has also extended the maturity date of a a $745m revolving credit facility from 2024 to 2027.

Air travel is recovering since the pandemic, although passenger numbers at Ireland’s five main airports were still a fifth below pre-pandemic levels in the first quarter.

Since then, strikes and staff shortages have wreaked havoc across Europe’s airports, with carriers including Aer Lingus, EasyJet, Lufthansa, British Airways and Wizz Air cutting thousands of flights and airports stepping in to limit traffic.

CEO designate Andy Cronin said the recovery and Avolon’s “strong” liquidity and order book underpins the firm’s “confidence” in the medium term.

“The rebound in demand has been met with operational challenges within airlines and at airports but we are seeing broad-based demand for new and used aircraft as passengers want to return to the skies,” Mr Cronin said.

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