for 60 years
LEADERS IN AVIATION SERVICES
A N N U A L R E P O R T 2 0 2 1
Leaders in
aviation services
for 60 years
Founded in 1961, Air Partner is a world-leading global
aviation services group providing aircraft charter, aviation
safety and security solutions and managed services to industry,
commerce, governments and private individuals, across civil
and defence organisations. With 60 years’ experience, we
are dedicated to going above and beyond delivering tailored
solutions for our customers across a breadth of service offering.
With a strong geographic presence and 24-hour year-round
flight operations centre, our team of aviation professionals
consistently puts our customers first to deliver the extraordinary.
Strategic report
1
Highlights 2021
2
Purpose, vision and mission
4
At a glance
6
Chair’s statement
8
Business model
10
Market review
15
Our strategy
20 Key performance indicators
22
Chief Executive Officer’s review
33
Chief Financial Officer’s review
40 Principal risks and uncertainties
49
Going concern and viability
statement
52
Sustainability
58
Section 172 statement
Corporate governance
61
Chair’s introduction to
governance
63
Corporate governance report
69
Governance structure: Board
and Committees
70
Board of Directors and Company
Secretary
72
Group Executive Team
73
Division of responsibilities
74
Composition, succession and
evaluation
75
Nomination Committee report
77
Audit and Risk Committee report
81
Directors’ remuneration report
97
Directors’ report
100 Statement of Directors’
responsibilities in respect of the
financial statements
Financial statements
102 Independent auditors’ report
113 Consolidated income statement
113 Consolidated statement of
comprehensive income
114 Consolidated statement of
changes in equity
115 Company statement of changes
in equity
116 Consolidated statement of
financial position
118 Company statement of financial
position
120 Consolidated and Company
statement of cash flows
121 Notes to the financial statements
Shareholder information
170 Notice of Annual General
Meeting
178 Explanation of the resolutions
to be proposed at the AGM
182 Company information
Highlights 2021
Operational highlights
‣ Excellent performance in Group Charter, arising from extensive evacuation activity
‣ Strong Freight performance driven by PPE flying and automotive supply chain disruption
‣ US Private Jets performed well, despite the pandemic, as high net worth individuals travelled for leisure
‣ Number of new JetCards sold up 9.4% on prior period
‣ Difficult period for Private Jets in UK and Europe due to ongoing travel restrictions
‣ Safety & Security adversely affected by the impact of the pandemic on the aviation industry
‣ Purchase of CHS Engineering Ltd trading assets further extended Managed Services offering
Financial highlights
2021
2020
Underlying continuing basic EPS
14.2p
6.4p
Basic continuing EPS
9.4p
0.6p
Final dividend
1.60p
—
Total dividend per share
2.40p
1.80p
Net cash/(debt)
£9.9m
£(6.9)m
1 Gross transaction value represents the total value invoiced
to clients and is stated exclusive of value added tax.
2 Underlying profit is stated after exceptional and other items.
Please refer to note 7 in the financial statements.
Gross transaction value1
£274.8m
19
18
20
21
273.3
261.3
236.8
274.8
Gross profit
£44.9m
19
18
20
21
35.5
34.7
34.2
44.9
Underlying profit before tax2
£11.6m
19
18
20
21
5.8
5.8
4.2
11.6
Profit before tax
£8.4m
19
18
20
21
3.4
4.8
0.9
8.4
Strategic report
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Air Partner plc | Annual Report 2021
Purpose, vision and mission
Purpose
Vision
Mission
Values
As we have grown and diversified our services and offering,
we have also ensured our brand is able to support our continued
growth and expansion. While our services reach from aircraft
charter to aviation safety consulting, our brand’s purpose, vision
and values unite us and underpin our strategy.
This is our purpose; it is why we exist
and what we continually strive for.
What do we want to achieve?
How will we get there?
Our strong values are embedded into
our business to help unite us and
deliver our Company vision and goals.
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Air Partner plc | Annual Report 2021
By putting our
customers first, we
create the difference.
We deliver the
extraordinary to
fly our world.
To be a world-class
aviation services group.
Care deeply
Customer First is in our DNA, whether
our customers are internal or external.
Treat people how you like to be treated.
So work closely, listen carefully and
respond with warmth and humility. Exceed
people’s expectations. Deeply value their
contributions. Always go the extra mile.
Take responsibility
Be the trusted partner people count
on. Do what you say you’ll do and follow
through. Taking full responsibility shows
true respect. So if something goes wrong,
be open, transparent and honest. Employ
ingenuity and integrity to find the
fair way forward.
Live your passion
Let your passion for work fuel your
hunger to discover the new. Stay
curious and informed, fearlessly
trying fresh approaches that propel
everyone forward. Respect each
other’s know-how and amplify
expertise, sharing it to help
everyone improve.
Work as one
Support and empower each other,
as one team – one Air Partner Group.
Build, nurture and value roles and
relationships with one another. Seek ways
to collaborate. Be a champion connector
of people, places and services – seeking
opportunities to strengthen our
commercial and creative success.
Be extraordinary
Extraordinary is a big word. It asks big
things of us. To go above and beyond.
Push that bit more in everything you do.
It’s the attitude that turns up the volume
on what you believe – and it’s vital that we
do this, to set us apart as an organisation.
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Air Partner plc | Annual Report 2021
At a glance
A global aviation
services group
Our business is split into two divisions. To complement our market-leading
core Charter business, our Safety & Security division, already one of the most
influential in aviation consulting and training, enables the provision of a broad
portfolio of products and services to our global customers.
EUROPE LONDON | GATWICK | CHELMSFORD | DONCASTER | PARIS | COLOGNE | MILAN | VIENNA
UNITED STATES FORT LAUDERDALE | LOS ANGELES | HOUSTON | WASHINGTON, D.C. | NEW YORK
MIDDLE EAST ISTANBUL | DUBAI
ASIA SINGAPORE
Experience
60yrs
Aviation professionals
420
Global locations
16
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Air Partner plc | Annual Report 2021
Charter
We work with all industries,
assisting corporates and
individuals to reach their
destinations and goals with our
charter services, 24/7 all year
round. Our tailored solutions
meet complex requirements
across a suite of services.
Safety & Security
Our highly technical experts work with our clients to resolve compliance
and regulatory performance challenges. We support the aviation and
transport sectors, critical national infrastructure, armed forces,
governments and regulators globally to address risk and vulnerabilities
throughout their organisations. By drawing upon our large pool
of expertise within aviation we help clients manage often complex
projects within airports and other related industries.
Chief Executive Officer’s
review: p22–32
Chief Executive Officer’s
review: p22–32
Group Charter
Charter of aircraft for larger groups
(20+ people) to governments,
corporates, sports and events,
the energy sector, industrial and
manufacturing customers, and tour
operators. Our services also include
short-term aircraft leasing, covering
both commercial and private aircraft.
Regulatory Compliance
In today’s complex regulatory
environment with a heightened
focus on safety and security within
aviation, it is integral that practices
are in line with regulatory standards.
Our compliance management
ranges from a single aspect of
a process through to a holistic
approach to your entire safety
and security operations.
Managed Services
Wildlife Hazard Management
We are one of the world’s leading
airport wildlife hazard management
specialists, offering affordable,
professional solutions to reduce
wildlife strikes.
Aircraft Registry
We design, build and operate
aircraft registries on behalf
of governments worldwide,
with a proven track record as
an experienced and reliable
government service partner.
Remote Condition Monitoring
Air Partner CHS (AP CHS) offers
consultancy services for airports
and logistics operations, remote
condition monitoring and baggage
system testing. AP CHS’s remote
condition monitoring service
provides valuable data and insight
to support operators to manage
key assets and undertake
preventive maintenance,
thereby reducing cost.
Training
Our National Safety & Security
Academy (NSSA) provides
industry-leading training, with the
capability to deliver a wide range
of industry leading courses, to our
global client base. We offer
training in person at our academy
or at client premises, and online
through an e-learning platform or
virtually. It is the only academy in
the UK to be recognised by ICAO
as one of only 32 approved
Aviation Security Training Centres
delivering globally against ICAO,
EU, TSA and UK standards.
Consultancy
Our consulting services
help organisations in both
the aviation sector and other
industries to achieve and maintain
compliance for safety and security
performance. We work with our
customers to ensure they have
the best practices in place to
support their safety and security
requirements and mitigate
potential risks.
Private Jets
Charter of smaller aircraft (up to
19 people) for corporates and high
net worth individuals (HNWI).
We offer a range of solutions to
meet our customers’ Private Jet
requirements, from On-demand,
a flexible JetCard membership
programme to custom proposals,
whether travelling for business
or leisure.
Freight
Charter and part-charter of cargo
aircraft, from Learjets to the giant
Antonov 225, for regular and
bespoke requirements, including
emergency aid drops, time-critical
door-to-door freight delivery and
onboard couriers.
Specialist Services
A range of other aviation services
that complement our Charter
business: Tour Operations, Air
Evacuation, Aircraft Sales and
Leasing and Flight Operations.
The above diagram explains our service offering and is not representative of our divisional structure.
Products and services
Divisions
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Air Partner plc | Annual Report 2021
Despite the highly complex backdrop
posed by the COVID-19 pandemic in
the year under review, we are pleased
to report a very strong set of results.
Gross profit was up 31.3% to £44.9m
(FY20: £34.2m), while underlying profit
before tax for the period stands at a
record £11.6m, an increase of 176.2%
on the prior year (FY20: £4.2m).
Statutory reported profit before tax
was also materially up on the prior
year at £8.4m (FY20: £0.9m).
The Group’s results are particularly
pleasing given the wider aviation
industry has been so negatively
impacted by COVID-19. This success
is due to our strategy to diversify the
business by product and geography,
which has served us well. We have
developed our business model so
that we operate in two distinct
divisions, Charter and Safety &
Security, which offers us a level of
protection against the ebbs and
flows in our operating environment.
Our performance for the period
reflects the inherent strengths that
diversity brings to Air Partner. Group
Charter and Freight were our best
performing services, due to the high
levels of COVID-19 related activity in
the first half of the year. Group Charter
carried out significant volumes of
evacuation and corporate shuttle
work, while the Freight team
experienced very high demand for
the transportation of emergency
protective personal equipment (PPE).
Conversely, Private Jets and Safety
& Security were negatively impacted
by government restrictions and
airport closures globally. However,
we saw some improvement here
in the second half of the year, with
a noticeable uptick in Private Jets
enquiries, especially in the United
States (US). From a geographical
perspective, the US was our standout
performer, contributing 39.6% to
the Group at a gross profit level
(FY20: 22.8%). This has been
extremely encouraging as we have
been actively scaling up our operations
in the US over the last four years,
there is a huge market here for Charter
services and it is a region in which
we still have a lot of headroom
to grow.
In terms of our customer offering,
the value of our scope of services
has been apparent throughout the
crisis, as we have been able to combine
the capabilities of our Charter and
Safety & Security divisions to provide
global tailored solutions that meet
multiple aviation requirements at
the same time.
I am proud of the way the Group
responded to the crisis across all
areas of the business. Throughout
the pandemic our number one
priority has been the health, safety
and wellbeing of our employees and
everyone that we work with. We
have worked hard to comply with
all government recommendations
Chair’s statement
Ed Warner
Chair
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Air Partner plc | Annual Report 2021
in the countries where our offices
are situated, as well as implement
additional preventative and protective
measures specific to our operations.
In addition, we brought in swift cost
saving measures in the early stages
of the pandemic, which included our
Board Directors taking a voluntary
pay reduction for April, May and June,
and took government support where
appropriate. Combined with our
actions throughout the year, this has
left us well positioned to benefit from
the eventual reopening of the travel
industry across both our Charter
and Safety & Security divisions.
Fundraise
On 12 June 2020, we announced the
successful completion of a placing of
new ordinary shares. Retail investors
were given the opportunity to
participate in the fundraising through
a retail offer on the PrimaryBid
platform. The oversubscribed
placing raised gross proceeds of
approximately £7.5m from new and
existing shareholders, which enabled
us to enter the second half of the
year with no debt and good working
capital to support large customer
programmes and invest in new
organic growth opportunities.
Board changes
In March 2020, we were greatly
saddened by the passing of Richard
Jackson, Air Partner’s Senior
Independent Director, after a short
illness. Richard was a hugely valued
and well-liked colleague, who provided
a significant contribution to the
Group’s strategy and he is greatly
missed. Following Richard’s passing,
Amanda Willis was appointed Senior
Non-executive Director at the next
Board meeting.
Dividend
As stated in our shareholder
update on the 22 February 2021,
the Board has reviewed its dividend
policy so as to ensure that the Group
has the ability to pay a sustainable
and growing level of dividends over
time. Recognising the importance of
dividends to Air Partner’s shareholders,
many of whom are private investors,
we announced the reinstatement of
dividends at the interim results
in September with a payment of
0.8 pence per share. The Board is
now recommending a final dividend
of 1.6 pence per share, making a total
of 2.4 pence per share for the year
as a whole. The final dividend is
expected to be paid on 15 July 2021
to those shareholders on the share
register at close of business on
11 June 2021. The ex-dividend date
will be 10 June 2021.
In future, looking beyond the
pandemic environment, the Board
will target dividend cover of 3.0 to
3.5 times earnings in a normal year,
after adding back non-cash related
exceptional items such as amortisation
of acquired intangibles.
Prospects
As the vaccination roll-out progresses
around the globe, we are prepared
and ready to support our customers
however we can as government
restrictions lift. We are seeing demand
returning for our Safety & Security
services as airports prepare for a
relaxation on lockdown rules and an
increase in passenger numbers, and
we are confident that Private Jets
activity will pick up significantly
over the coming months.
We are pleased to see the US
continue to perform well, particularly
in Private Jets and Freight, proving
the rationale for our ongoing
investment in this region. As I have
said before, it’s an area of significant
opportunity for us and we shall
continue to focus on growing our
share of the US charter market.
The Group’s strong performance in
the period under review, combined
with the cost-cutting and fundraising
actions taken, stand us in good
stead for the current financial year.
We are debt free with a solid cash
position and a streamlined business.
We were already confident that our
diversification strategy to mitigate
against product or market volatility
was the correct one, and the past
year has served to reinforce that we
have taken the right course. We are
very pleased to be able to leave such
a tumultuous year on solid footing,
and we shall seek to capitalise on
this by continuing to explore organic
and acquisition growth opportunities,
while remaining mindful of the current
economic climate.
I would like to extend my most
sincere thanks to Air Partner’s people
worldwide, who have shown such
dedication and diligence during this
busy and difficult period. Despite the
challenges involved in complying with
government guidelines, our teams
across the Group have remained
focused on delivering exceptional
service to all of our customers. I would
also like to thank our shareholders, new
and old, for their continued support.
Ed Warner
Non-executive Chair
11 May 2021
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Air Partner plc | Annual Report 2021
Business model
Delivering the extraordinary
for 60 years
Our focus continues to be the generation of long-term, sustainable value for our stakeholders
through the diverse portfolio of services that we offer to our global customer base. We aim to
be a world-class global aviation services group, using our unrivalled industry experience and
network to deliver a truly exceptional service to our customers.
Key strengths
that drive
our business
‣ Experienced aviation
professionals
‣ Diversified portfolio
of aviation products
and services
‣ Global footprint
‣ Leading market
reputation
‣ Clear long-term
strategy
‣ Cash generative
‣ Long-standing
relationships with
customers and
suppliers
‣ Diverse customer
profiles
‣ Customer focused
‣ Strong long-term
market fundamentals
What we do
Charter
Our market-leading Charter team offers a
suite of bespoke services across Group Charter,
Private Jets, Freight and Specialist Services,
working with a wide range of customers globally,
including governments, royalty, multi-national
organisations and individuals. Without owning
any aircraft, we leverage the relationships we
have in place with aircraft operators to create
tailored solutions to meet our customers’ often
complex requirements.
Safety & Security
Our Safety & Security division was formed after
the acquisition of Redline Worldwide Ltd (Redline)
in December 2019. The division comprises
Baines Simmons, which offers aviation safety
and fatigue risk management, and Redline, which
delivers government-standard security training,
consultancy and solutions to regulated, high
value and high threat environments. We support
companies in the aviation and transport sectors,
critical national infrastructure, armed forces,
governments and regulators globally to address
risk and vulnerabilities in their organisations.
Managed Services
Within our Safety & Security division, our
Managed Services offering comprises wildlife
hazard management, aircraft registry services,
consultancy services for airports and logistics
operations, remote condition monitoring and
baggage system testing.
What differentiates us
Delivering above and beyond
for our customers
Our ability to deliver exceptional customer
service is integral to our business and we
strive continuously to provide bespoke,
creative solutions that are built around
our customers’ individual requirements.
We build long-standing relationships
with our customers and suppliers. As a
result of the experience we have gained
from 60 years in business, we have high
levels of customer retention and are a
preferred supplier to some of the most
prestigious organisations and discerning
individuals in the world.
A trusted partner with an
unrivalled breath of services
and experience
Our decades of aviation experience, global
reach and diverse range of services set us
apart from our competitors, enabling us
to handle extremely complex projects that
others could not. As a listed company we are
governed by strict financial regulations and
are committed to achieving a high standard
of corporate governance, thereby providing
all stakeholders with financial transparency
and assurance.
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Air Partner plc | Annual Report 2021
Strategic report
Where we add value
For our customers
We provide world-leading services through our Charter
and Safety & Security divisions, having extended our
geographic presence and service offering over recent
years in order to meet our customers’ diverse requirements.
Since we do not own any aircraft and are not limited to
a certain fleet, our Charter division is able to source the
right aircraft for our customers’ exact needs. Meanwhile,
our Safety & Security division delivers expertise and
technical know-how in highly specialised areas to support
our customers as they navigate an ever-changing
regulatory environment. Redline also operates the UK’s
only International Civil Aviation Organisation (ICAO)
Aviation Security Training Centre and boasts market-
leading proprietary software solutions in Security
Management Systems (SeMS).
Net promoter score
93% (2020: 89%)
For our people
As a business, we are committed to providing a diverse
and inclusive working environment where everyone
is treated fairly and with respect, and to help all our
employees reach their full potential and develop valuable
skillsets. Given the challenging circumstances of the
pandemic, in the last year we have prioritised establishing
new ways of working, employees’ mental health and
wellbeing and regular, effective communication between
management and employees. We have been encouraged by
the success of these initiatives and will continue to develop
ways in which we can support our employees further.
We conducted an engagement survey during the year
seeking feedback from employees on matters such as
communication, engagement, reward and recognition.
Engagement score 2021
74%
(Note: survey not performed in 2020)
For our suppliers
We aim to build supplier relationships based on mutual
respect with appropriate risk apportionment, and a fair
return for all partners.
In the Charter division, the financial stability of the airlines
and operators we work with is key to our service delivery
and risk mitigation. Quality of supply and reliability are
paramount to our customers, so we work closely with
our suppliers to guarantee these. We endeavour to build
long-standing relationships with all our suppliers, and
they can rely on our Charter team to market their aircraft
effectively and professionally to our global, diversified
customer base. We are also looking to develop a
preferred supplier relationship programme.
Unfortunately, the Group Charter supplier conference
we had planned for 2020 could not take place due to
the COVID-19 pandemic, and industry events such as
EBACE, where we would normally meet with our
suppliers, were cancelled.
Number of aircraft operators
we worked with over 2020
>550
For our shareholders
Our long-term strategic objective is to grow our aviation
services business by diversifying our portfolio across
geographies and complementary product lines, both
organically and through acquisition. One of our stated
aims is to invest in our Safety & Security division to
increase the forward visibility of earnings, thereby
smoothing the volatility in earnings inherent in our
Charter business. As well as reinvesting in the business
for the long-term benefit of all stakeholders, we are a
dividend paying stock. Looking beyond the conditions
created by the COVID-19 pandemic, the Board is targeting
dividend cover of 3.0 to 3.5 times earnings in a normal
year, after adding back non-cash related exceptional
items such as amortisation of acquired intangibles.
Total dividend per share
2.4p (2020: 1.8p)
(Note: in 2020 the final dividend was suspended
due to COVID-19)
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Air Partner plc | Annual Report 2021
Strategic report
Our market drivers
The key factors which influence Air Partner’s aviation services business.
Market review
Impact on us
The long-term outlook for the aviation industry remains positive due
to the fundamental drivers of demand for air travel and transportation:
economic growth, increasing propensity to travel due to increased
global trade, globalisation, and improved airline services driven by
liberalisation of air traffic rights between countries. This has been
evident during the year with demand for our Charter services. The
Safety & Security division is also seeing increasing order books as
we start to recover from the effects of the pandemic.
The road to recovery remains unpredictable as varying regional travel
restrictions and protocols continue to impact air travel. The pace of
recovery will be heavily dependent on COVID-19 infection rates,
the availability of vaccines, and government travel restrictions.
How we are responding
We are building a portfolio of aviation services in line with our
customers’ requirements. The addition of further services gives us
the opportunity to cross-sell between our two divisions to increase
revenue, strengthen customer relationships and support customer
retention. We are also investing in our teams and building our
geographic presence where we see demand and opportunity.
Impact on us
Changes in the supply base can affect our operations in a number of
ways, including availability of aircraft, pricing and quality of service.
In the Safety & Security division, we are seeing more customers go
online and use digital platforms for their training and development
needs (see Technology market driver on page 12).
How we are responding
As Air Partner continues to foster its culture of extraordinary
customer service, our supplier relationships remain a key focus point
in our organisation, ensuring the highest standards of safety and
service are at the heart of all we do.
We have recently hired a Vice President of Supplier Relations in the
US and we are looking to do the same in the UK for Europe and the
Rest of the world as we increase our efforts to strengthen
relationships with key suppliers.
This role will be the first resource dedicated solely to ensuring that we
continue to deliver a high quality service to all our Charter customers,
as well as promoting our broad range of services in the air carrier market.
Demand
The demand for airline products and services depends primarily on
economic growth. According to world economic data, global gross
domestic product (GDP) declined in 2020 by 3.5%. Amid high levels
of uncertainty surrounding the pandemic, growth for 2021 and 2022
is projected to be +5.5% and +4.2% respectively (source: World
Economic Outlook Update, January 2021).
The travel industry has been severely impacted by the pandemic, with
border closures and government restrictions severely limiting customers’
ability and willingness to fly. The latest International Air Transport
Association (IATA) outlook forecasts that passenger traffic for 2021
will be up by 55% on 2020, albeit still materially lower than the 2019
performance: ‘Passenger numbers are expected to grow to 2.8 billion
in 2021. That would be a billion more travellers than in 2020, but still
1.7 billion travellers short of 2019 performance’.
Overall, industry experts are predicting that it will take approximately
three years for worldwide travel to return to 2019 levels and a few
years beyond that for the industry to resume the long-term growth
trend of approximately 5%.
Supply
Group Charter supply has been affected by a number of operators
going out of business as a result of COVID-19.
In Private Jets we have seen market consolidation with a number of
smaller operators disappearing.
In terms of air cargo, there have been capacity limitations in the
market given the significant impact that COVID-19 has had on
international passenger operations, which usually carry cargo in the
belly of the planes. This has resulted in high demand for dedicated
freighters and as a result we have seen passenger aircraft
reconfigured for freight logistics operations only.
In terms of service delivery for training and consultancy we are seeing
a shift in the market from on-premise to digital solutions.
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Air Partner plc | Annual Report 2021
Impact on us
While these events can cause a short-term decrease in normal demand
for air travel, unforeseen world and local events can also increase
short-term demand for aircraft charter and security services as
exemplified by the COVID-19 pandemic.
How we are responding
Our Charter and Safety & Security divisions work closely with
government and non-government organisations and freight forwarders
to transport aid, equipment and personnel at short notice. As a
24-hour business, we have the resources in place to execute our
customers’ time-critical requests.
Meanwhile, our strategy to diversify our product offering, targeting
a global customer base, has allowed us to reduce reliance on any one
sector, geography or customer.
Impact on us
All our stakeholders, be it customers, shareholders, suppliers or
employees, will expect us to carry out any remedial actions that we
can to counteract the negative impact of aviation on climate change.
They will also want us to positively impact the economies and
communities in which we operate and create the best working
environment for our people.
Airlines, whether they are suppliers to our Charter division or
customers of our Safety & Security division, may be impacted
by changes in customer behaviour and increased governmental
regulations aimed at reducing aviation’s negative impact on the
environment. In turn, we will need to manage any structural changes
in our supply chain and the impact this may have on our customers.
How we are responding
We have a clear environment strategy in place that responds to
stakeholder concerns. This strategy has four pillars:
‣
encourage Charter customers to offset carbon emissions from
their flights;
‣
form partnerships with charities supporting environmental
protection causes;
‣
reduce our internal resource consumption; and
‣
report the impact of our activities on the environment consistently
and transparently.
As part of our focus on the Group’s societal impact, we have
established a clear development strategy for our people, including
supporting their overall health and wellbeing. We are also working on
making a positive difference to the communities in which we operate,
for example via donations to chosen charities.
Air Partner’s Board is fully committed to these initiatives and supports
management and staff in achieving their environmental and social goals.
For more details on our sustainability strategy, see pages 52 to 57.
Natural disasters, geopolitical
events and terror attacks
The global aviation market can be adversely affected by geopolitical
events, natural disasters and terror attacks. These have both
short-term and long-term consequences for demand and supply.
Environmental and social
Environmental concerns are a challenge for the aviation industry. In
order for the sector to achieve the UK and EU target of net-zero CO2
emissions by 2050, advanced technologies and the increased use of
sustainable aviation fuels (SAF) will be needed, as well as remedial
actions such as carbon offsetting and reducing resource consumption.
A company’s impact on communities and people is also an
increasingly important consideration among all stakeholders.
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Air Partner plc | Annual Report 2021
Impact on us
Private Jets customers are increasingly asking for digitalised services
and on-demand facilities. Some of our competitors have invested
heavily in this area but have had limited success in offering the
customer an end-to-end solution for booking a private jet without
a human interface.
Fuelled by the pandemic, we have seen an increase in uptake and
demand for online training courses and remote learning, and we
expect this trend to continue. Our Safety & Security division is well
positioned to benefit from this.
How we are responding
We are in the process of developing a JetCard portal for our Private
Jets customers, enhancing the overall customer experience. Once we
have rolled this out, we will focus next on developing an Air Partner
portal to satisfy all our customer needs across the product range.
Driven by customer demand, we have increased the number of online
training course we offer and are continually investing in the content
and user experience.
During the year, we completed the roll-out of our customer relationship
management tool for both Charter and Safety & Security and we are
now using the data to drive decision making in the organisation and
improve our customer service.
Impact on us
Competitors are employing a number of tactics to increase their market
share, including new product development, price cutting, expansion
in technology, aggressive promotion and geographical expansion.
How we are responding
With 60 years of sector experience, Air Partner is an established and
reliable player in the charter sector. In an industry where we have
seen a lot of competitors come and go, we offer stability and superior
quality to our customers. We continually review our product offering
and look to provide additional value-added service wherever possible
across our global footprint. Our purpose to deliver the extraordinary
keeps us focused on providing a market-leading service and maintaining
our excellent relationships with our diverse customer base.
Technology
Technology innovation and advancement are introducing opportunities
to change the buying patterns of our customers and improve efficiencies.
COVID-19 has accelerated the growing trend for digitalised services
and solutions. This changing landscape is also providing an opening
for new entrants into the market for more commoditised products
and services.
The competitive landscape
for charter
The global air charter market continues to be highly competitive and
fragmented with low barriers to entry.
Market review continued
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Air Partner plc | Annual Report 2021
Impact on us
Given the number of competitors offering aviation safety and security
products aligned with an industry that is in recovery mode from the
financial impact of the pandemic, the sector will remain under
pricing pressure for the foreseeable future.
Competitors are investing in product development and digitalisation
to simplify content delivery and to cut operating costs.
Customers are in turn looking to suppliers to help support them in
their long-term financial recovery by delivery of more cost effective
and efficient products and services.
How we are responding
Our Safety & Security division is made up of recognised experts in
our field with a strong reputation in the market for safety and security
products and services spanning a vast portfolio of training,
consultancy, compliance auditing, operational management and
oversight, software, solutions and business supporting services. This
is evident by our list of blue-chip customers and government
contracted work.
In Safety, our services are delivered by experts with a high degree
of specialism in regulation and compliance, which is not easily
replicated by our competitors.
In Security, our range of products and services spans the entire
spectrum and includes technology based software applications and
tools, such as its digital Security Management Systems (SeMS), threat
image recognition software for X-ray operators and a wide range of
e-learning courses covering both the safety and security product portfolio.
In Redline, we are endorsed by the International Civil Aviation
Organisation (ICAO) as an Aviation Security Training Centre (ASTC).
Impact on us
Many operators are choosing to outsource training and use
consultancy services to keep abreast of the rapidly changing
regulatory environment and manage costs. With its diverse range
of products and services in Charter and Safety & Security, Air Partner
is well positioned to capitalise on the expected uptick in demand as
the travel market reopens post lockdown.
The significant scale of pent-up demand for international travel will
mean a rapid and sustained growth of the aviation sector, creating
strong demand for our Safety & Security offering in particular.
The Safety business will be first in line to help support and train
the airline industry recovering its fleet and operating crews post
lockdown, while the Security business will help airports to meet the
required regulatory standards for its workforce as they begin to scale
backup operations post COVID-19.
How we are responding
As a result of the pandemic, the Group has quickly transitioned from
largely on premise operational delivery to digital platforms.
Working in partnership with our customers, we are providing rapid,
sustainable and affordable solutions that can weather future COVID-19
(or other) challenges so that our customers can recover as quickly as
possible with our support.
Additionally, switching to virtual delivery platforms affords our
customers a long-term cost benefit, as it reduces/removes unnecessary
travel and accommodation costs. This is strategically important for us
as many of our customers now view virtual delivery as part of the new
way of doing business.
The investment across the Safety & Security division in virtual delivery
platforms for audit, training and testing means we are able to rapidly
deploy our well-proven capabilities to customers on a truly global basis.
The competitive landscape
for safety and security
The market for safety and security products and services is highly
competitive and wide ranging. Security is mandated through
regulation, meaning the vast majority of products and services are a
must have for customers; with the deciding factor typically who
delivers the requirement and at what cost. Safety, whilst not
mandated, is a critical requirement for the worldwide airline industry.
In the post-COVID-19 recovery period, price will remain the main
competing factor for customers’ selection of suppliers.
Increasing regulation
and compliance
Growth within the aviation industry, characterised by busier skies,
increased competition, demands for higher fleet utilisation and greater
operational capability, is taking place against a backdrop of increasing
regulation and compliance, as well as the continued threat from acts
of terrorism.
This trend is expected to continue post pandemic, with the increased
requirement to rebuild depleted workforces, upskill and refresh staff
and integrate new airport equipment as the industry looks at new
ways to operate in a post-COVID-19 world.
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Air Partner plc | Annual Report 2021
CASE STUDY:
A holistic approach in delivering charter,
safety and security services to our customers
Air Partner delivered a unique
and fully integrated solution of
services for the critical evacuation
and repatriation of 32 UK and Irish
nationals onboard the Princess
cruise ship quarantined off the
coast of Yokohama in Japan on
behalf of the UK Foreign and
Commonwealth Office (FCO). The
project was complex, challenging
and time sensitive, made more
demanding by the requirement for
the FCO to carry out the security
screening of all passengers and
baggage in Tokyo before they
could board the flight back to the
UK. Employees from across the Air
Partner Group worked closely with
the FCO, the operating airline, the
Department for Transport (DFT)
and authorities to obtain approvals
needed to complete the project.
The Group Charter team chartered
a Boeing 747-400 to carry out
the flight from Tokyo Haneda to
Boscombe Down in the UK, ensuring
that the aircraft was optimally
configured to segregate evacuees
safely. Redline security experts
worked on the security screening
along with providing the necessary
scanning equipment. Our Freight
team worked alongside Redline to
charter a Metroliner freighter to
transport the security equipment
directly from Redline’s Training
Centre overseas.
‘By offering a holistic
approach to our customer’s
needs we were able to sell
charter services combined
with safety and security.
This is a great example of
how we are able to meet
our diverse customer
aviation requirements
in a fast-moving
crisis situation.’
Mark Briffa, Chief Executive Officer
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Air Partner plc | Annual Report 2021
‣ We completed the roll-out of our customer relationship
management (CRM) system across the Group.
This allows us to better understand our customers’
buying needs, while enabling us to tailor our product
and service offerings.
FY22 priorities
‣ Continue the integration of our Safety & Security
businesses, allowing us to adapt our product offering
under the new normal, which will include the use of
technology to deliver training through virtual platforms.
‣ Launch the Group JetCard portal by the end of FY22.
This will enable our customers to gain instant access
to their trips and flight balances.
‣ Appoint a supplier relation expert in the US in Q1 and in
Europe by the end of FY22.
‣ Continue the benchmarking of our customer service
offerings through customer feedback and our NPS
and Feefo rankings. Our targets will be greater than
85% and no less than four stars.
Net promoter score
93% (2020: 89%)
KPIs: p20–21
Risks: p44–48
Progress in the year
‣ In this extraordinary year, we have harnessed our
immense experience across the Group to deliver
customised solutions across multiple products and
services against a challenging market environment.
This was exemplified by our work at the start of the
pandemic, which saw our Charter and Safety & Security
divisions working hand-in-hand to deliver complex
evacuation solutions for a government customer at
extremely short notice. See our case study on page 14.
‣ During the pandemic, we have provided tailored
solutions for our customers, providing a one-stop-shop
for all their needs. Throughout the year we have
continually seen our customers purchasing more than
one service. For example, a number of our Group
Charter customers have also made bookings with our
Private Jets team, while Private Jets and Air Evacuation
customers have bought our Security services and
products. This is an encouraging trend, which we intend
to capitalise on through our cross-selling initiatives.
‣ Our customer feedback has been exemplary and we are
tremendously proud of our colleagues, who have put
our customers first in all they have done during the year.
‣ In Safety & Security, many of our airport and operator
customers scaled back or, in some cases, mothballed
operations during the pandemic. We are now working
within tight timeframes to support these customers as
they remobilise, be it through the provision of training,
safety audits or advisory services, so that they can up
scale at short notice and offer an optimal service to
their customers.
‣ We continue to invest in the customer experience and
launched our new Group Investor and Charter websites
during the year. Working on a much-improved platform,
this is enabling us to better track customer response
and lead generation.
Maintaining our long-term strategy
In line with our business strategy, we continue to grow our world-class global aviation services group to meet
our customers’ ever-evolving needs, despite the unprecedented circumstances posed by the COVID-19
pandemic. As a Group, we are dedicated to delivering tailored solutions and the very highest levels of service to
our customers. Our strategy is underpinned by our culture of putting the customer at the heart of everything
we do, to deliver the extraordinary. To achieve our objective, we have five strategic priorities:
Our strategy
1.
Putting our customers first
The cornerstone of our business is our Customer First principle. To achieve this, we
work closely with our customers to provide consistent and exceptional service across
the Group globally. Our annual Peter Saunders Award for Extraordinary Customer
Service, now in its third year, has helped to further cement our customer ethos among
our people across the business.
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Air Partner plc | Annual Report 2021
FY22 priorities
‣ Continue the growth trajectory of the US business across
all product and service lines by investing in new talent
acquisition. It is expected that the US will be the Group’s
biggest contributor of gross profit for the next few years.
‣ Explore additional growth opportunities in Asia Pacific,
including Australia, and invest further in Air Partner’s
presence in Dubai and Singapore by adding talent.
‣ Strengthen the Freight business across all our locations
by hiring key talent and targeting specific market sectors.
‣ Harness the Group’s key customer relationships to sell
the full range of Air Partner’s products and services.
‣ Improve the marketing presence of the Air Partner brand
by accelerating innovation and digitalisation in the
organisation, with the aim of improving customer reach.
‣ Complete integration of the Safety & Security division
to enable us to leverage resources across the Group
to capitalise on cross-selling opportunities.
‣ Explore ways for the Safety & Security business
to enter the US market, as well as adding strategic
partners in Southeast Asia.
‣ Launch and promote our new environment strategy
with our customers. Alert customers to the
opportunity to offset the carbon emissions of their
private jet flights to achieve carbon neutrality.
‣ Commit to reducing our own carbon footprint and
achieving carbon neutrality from our own internal
operations.
Our strategy continued
2.
Growing organically:
strengthening our core business
We continue to strengthen our core business through organic growth. This is achieved
through various initiatives, including the hiring of new talent, investment in our people
through training, and the enhancement of our technology capabilities to allow the Group
to deliver products through virtual channels, for example e-learning. We will continue
to assess new strategic locations, taking into account the current market conditions and
the post-pandemic recovery.
Progress in the year
‣ In FY21, our activities were firmly rooted in meeting the
demands of our customers as the world responded to
the impact of the pandemic.
‣ We demonstrated the strength of our stated strategy
to diversify our earnings so that the Group is not reliant
on any one product, market or geography, and this
diversification left us well positioned to navigate an
extremely challenging and uncertain marketplace. For
example, in our Charter division, when Group Charter
and Freight were strong at the start of the crisis,
Private Jets was weak. However, as borders reopened,
Private Jets activity increased, particularly in the US,
where there has been a different approach to lockdowns.
‣ We invested further in our Singapore operations by
increasing our Freight presence in the region.
‣ Prior year investment in Freight talent in the UK and US
proved highly successful.
‣ Fatigue Risk Management (previously Clockwork
Research) had a very successful year delivering
contracts to well-known airlines and energy customers.
‣ Wildlife Hazard Management delivered expected returns
throughout the year, as many regional military airfields
continued to use this service, despite the pandemic.
‣ Many safety training courses were converted from
classroom delivery to virtual delivery, and we are
seeing this trend continue in our new financial year.
Contribution to gross profit from outside the UK
55.0% (2020: 49.1%)
KPIs: p20–21
Risks: p44–48
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Air Partner plc | Annual Report 2021
FY22 priorities
‣ Acquire key talent to support organic growth and
continue to increase our JetCard product sales across
the US, the UK and Europe.
‣ Continue the integration of our Safety & Security
businesses so that we can benefit from marketing
these products and services under the Air Partner
Safety & Security umbrella brand.
‣ Continue to leverage the value of the new CRM system.
‣ Introduce new product offerings for the Safety &
Security division utilising virtual platforms.
‣ Capitalise on cross-selling opportunities across our
Safety & Security businesses as airports remobilise and
passenger numbers return post lockdowns. This
includes the newly acquired CHS business, albeit on
a smaller scale.
‣ Build the Redline business in line with pre-COVID-19
expectations as airports reopen and customer demand
returns. Redline typically enjoys long-term contracted
revenues with global blue-chip customers, good
forward visibility of its revenues, and a high customer
retention rate.
‣ Continue to review further targeted acquisition
opportunities that add capability and provide a steady
revenue stream.
Safety & Security's contribution to Group gross profit
12.9% (2020: 13.5%)
KPIs: p20–21
Risks: p44–48
3.
Broadening our offering
The Group provides a diverse portfolio of aviation services so that we can better
meet our customers’ ever-evolving needs, while reducing our exposure to the
volatility of the charter market and improving the overall quality of our earnings.
We continue to assess targeted acquisition opportunities that add capability and
provide a steady revenue stream.
Progress in the year
‣ With the addition of Redline into the Safety & Security
division in December 2019, it was our aim to dilute the
Group’s dependency on the Charter division. Regrettably,
the Safety & Security division’s revenues were materially
impacted by the pandemic, as its customers (airline
operators and corporates requiring safety and security
products) scaled back their operations.
‣ Progress on the integration of Redline into the Safety &
Security division has been slower than expected, mainly
due to the effect of the pandemic. However, good
progress was made in terms of embedding Air Partner’s
culture, values, policies and procedures, as well as
developing the go-to-market brand (Air Partner Safety
& Security), and establishing cross-functional teams to
capitalise on cross-selling opportunities within the
enlarged group.
‣ We have successfully implemented a new CRM system
across the Charter division, enabling us to see all our
customer activity on one platform.
‣ At the end of 2020, we acquired the trading assets
of CHS Engineering Ltd after the business went into
administration. We subsequently formed a new
trading entity, Air Partner CHS Ltd (CHS), which
offers consultancy services for airports and logistics
operations, remote condition monitoring, and baggage
system testing. This business will be incorporated into
Air Partner’s Managed Services offering within the
Safety & Security division.
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Air Partner plc | Annual Report 2021
Engagement score 2021
74.0%
(note: survey not performed in 2020)
KPIs: p20–21
Risks: p44–48
FY22 priorities
‣ Continue the progress of our Group People strategy,
adapting to the changing market environment and the
addition of our newly acquired businesses. Particular focus
for next year will be on ways of working post pandemic,
with a refreshed flexible working policy and new agile
working guidelines.
‣ Further develop our mental health and wellbeing
programme in partnership with the Charlie Waller
Memorial Trust, as our fundamental priority remains
the health, safety and wellbeing of our people.
‣ Complete the organisational design work commenced
in FY20 (delayed in FY21 as a result of the pandemic).
‣ Commence further work on our employee reward
programme, looking at flexible employee benefits
in order to attract and retain the very best talent.
4.
Developing and retaining our people
Air Partner is a people business and we remain committed to recruiting
the best people to join our already strong and customer-focused teams.
We provide an inclusive and safe working environment for all our
colleagues to ensure they are able to reach their full potential.
Progress in the year
‣ We implemented comprehensive actions to
support employee mental health and wellbeing
and facilitate effective working from home during
the COVID-19 pandemic.
‣ A group-wide engagement survey, ‘Your Say’, was
held during the year, with overall engagement of 74%
(up 5% from the previous survey done in 2019). In addition,
two pulse surveys were undertaken to assess employee
engagement, with both surveys receiving positive results.
‣ Significant focus was placed on improving
communication, engagement, reward and recognition
across the organisation, with several initiatives
implemented. These included weekly CEO video
updates throughout the pandemic, monthly ‘All Hands’
virtual town hall meetings (with the ability to ask
questions anonymously) and the development of
a new intranet platform.
‣ Implicit bias training sessions were conducted
across the Group to support our focus on diversity
and inclusion.
‣ The Air Partner Sharesave scheme was recently
launched to all UK based employees.
Our strategy continued
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Air Partner plc | Annual Report 2021
5.
Embedding our brand across our business
As a Group, we have grown and diversified but we remain united across our Charter and
Safety & Security divisions by our strong brand and Company values. The strength of the
Air Partner brand is testament to the extraordinary customer service that we deliver. The
development of our brand has continued to evolve, and the use of the core brand proposition
and the establishment of our single-brand approach enable us to onboard new
acquisitions within this framework.
Progress in the year
‣ We continued to embed our brand values into
everything we do across the organisation, both
internally and externally, to improve on our
Company culture.
‣ We launched our new Charter website, as well as
our Group site for investors.
‣ We continued the development of our feedback and
appraisal system, which recognises employees
delivering our brand values, both to customers and
colleagues:
‣ Our purpose: We deliver the extraordinary to fly
our world.
‣ Our vision: To be a world-class aviation
services group.
‣ Our mission: By putting our customers first,
we create the difference.
‣ Our values: Care deeply, take responsibility, live
your passion, work as one, be extraordinary.
FY22 priorities
‣ Continue to embed the Safety & Security division
under the Air Partner umbrella branding, internally
and externally.
‣ Invest appropriately in marketing the Air Partner brand
across all products and services.
‣ Utilise the strength of our new brand and our 60-year
heritage to leverage growth opportunities across key
industries and markets.
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Air Partner plc | Annual Report 2021
Key performance indicators
Measuring performance
against our strategic objectives
Strategic KPIs
Our performance against our key performance indicators (KPIs) reflects
the Group’s strength and resilience in very challenging market conditions.
Customers and brand
Net promoter score
Calculated by subtracting the percentage of customers
who are detractors (those who score the Group’s service
0–6 out of 10) from those who are promoters (score the
Group’s service 9 or more out of 10).
93% (2020: 89%)
Strengthening our core Charter business
Measuring gross profit growth in our Charter business
Organic growth remains a top priority. We are committed
to diversifying the Group’s gross profit across our various
products, services and locations. This measure focuses
on how we are performing in our core Charter division.
£39.1m (2020: £29.6m)
Refer to the Chief Executive’s Divisional Review for a full
breakdown on pages 22 to 32.
Broadening our offer
Growing the Safety & Security division –
delivering on Air Partner’s diversification strategy
This KPI measures the gross profit the Safety & Security
division contributes to the overall Group. The expectation
is, post the pandemic, that Safety & Security will continue
to grow both organically and via acquisition, diluting our
dependency on the unpredictable Charter division. The
first acquisition we did in Safety & Security was in 2015.
Since then we have been actively acquiring new
businesses in this area.
Contribution to Group gross profits
12.9% (2020: 13.5%)
Developing and retaining our people
Employee turnover
Calculated as the percentage of employees who leave
the Group on a voluntary basis during the financial year
and are replaced by new employees.
8.4% (2020: 20.8%)
Engagement
Measurement of employee positivity in response
to a group of key questions on employee advocacy
and overall satisfaction.
Engagement score 2021
74%
(note: survey not performed in 2020)
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Air Partner plc | Annual Report 2021
18
19
20
(8.5)
21
Gross transaction value (GTV)
£274.8m
Definition: This represents
the total amount invoiced
to our customers, exclusive
of value added tax. We
use this as a KPI instead of
revenue as it gives a fairer
impression of the scale
of the business and the
impact it can have on
the working capital of
the business.
Performance: Refer to the
Chief Financial Officer’s
review on pages 33 to 39.
Definition: Total sales
minus the cost of providing
the service (refer to the
accounting policies on
pages 121 to 132.) We
consider gross profit a key
measure given the agent
versus principal status of
the Charter division, which
represented 87.1% (FY20:
86.5%) of the total Group’s
gross profit in the year.
Performance: Refer to the
Chief Financial Officer’s
review on pages 33 to 39.
Definition: Underlying
profit before tax is stated
before exceptional and
other items (see note 7 in
the financial statements).
It is the main measure of
financial performance
used within the business.
Performance: Refer to the
Chief Financial Officer’s
review on pages 33 to 39.
Gross profit
£44.9m
Underlying profit before tax
£11.6m
19
18
18
18
20
21
261.3
273.3
236.8
274.8
19
18
20
21
35.5
34.6
34.2
44.9
19
18
20
21
5.8
5.8
4.2
11.6
Definition: Profit after
tax divided by the average
number of ordinary shares
outstanding in the period.
Performance: Much
improved in the period
given the strong levels of
trading in the underlying
business offset by £3.2m
of exceptional costs; refer
to note 7 in the financial
statements.
Definition: Calculated as
operating profit for the
year over net assets.
Performance: Greater
return on equity driven by
the strong performance
in the year despite net
assets doubling.
Basic earnings per share
9.4p
Return on equity
42.0%
Definition: Underlying
earnings (profit after tax
adjusted for exceptional
and other items) divided
by the average number
of shares outstanding in
the period.
Performance: Higher than
the prior year due to an
increase in the underlying
performance of the
business. The weighted
average number of shares
increased in the period
by 13.8%.
Underlying basic earnings per share
14.2p
19
20
21
9.6
6.4
14.2
Dividends per share
2.4p
Definition: Total dividends
divided by total number of
ordinary shares
outstanding.
Performance: Given the
impact of the pandemic
and the resulting
uncertainty in the market,
the Directors did not
recommend a final
dividend for FY20 but
have since resumed
payments. We reviewed
our dividend policy in
February 2021. Refer to
the Chair’s Statement
on pages 6 and 7.
Net cash/(debt) (excluding JetCard)
£9.9m
Definition: This measure
represents cash in the
business, net of debt,
excluding that held
on account for our
JetCard members.
Performance: Following
the shareholder fundraise
in June 2020, debt
relating to the Redline
acquisition was fully
paid down. The strong
underlying trading of the
business during the year
has much improved the
Group’s liquidity from
the prior year and is
cash positive.
Total shareholder return
(8.5)%
Definition: Calculated as
the closing share price for
the period plus dividends
paid, less opening share
price, all divided by
opening share price.
Performance: Refer to the
dividends per share KPI.
Financial KPIs
We monitor a range of financial metrics that reflect the underlying strength of our business and help to measure
progress against our strategy.
(10.9)
(33.9)
37.6
20
21
2.0
(6.9)
19
8.4
4.8
18
19
20
21
5.6
1.8
2.4
5.5
18
19
20
21
5.6
0.6
9.4
6.9
18
19
20
21
30.5
16.0
42.0
42.3
9.9
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Air Partner plc | Annual Report 2021
Chief Executive Officer’s review
We are reporting underlying profit
before tax of £11.6m (FY20: £4.2m),
which was predominantly driven
by the strong performance in Group
Charter and Freight in the first half of
the year, as they carried out very high
levels of emergency evacuations and
PPE flying as a result of the pandemic.
On a statutory reported basis, profit
before tax was £8.4m (FY20: £0.9m).
I am particularly pleased to be
reporting this strong set of results
given that other areas of our business,
such as Private Jets in the UK and
Europe and Safety & Security, were
negatively impacted by the COVID-19
crisis, in line with wider aviation
market trends. The high levels of
activity early in the year resulted
in record results, however, trading in
the second half of the year returned to
more normalised levels, similar to the
prior year.
The year under review is the
most remarkable time I have ever
encountered in my 33 years in the
aviation industry. Air Partner is used
to operating in the volatile market
conditions associated with air
charter, but we have never before
seen such an unpredictable trading
environment. I have been hugely
impressed by our people, who have
worked extremely hard in often
challenging circumstances, and
they have my deepest thanks.
The importance of putting our
customers first and providing
exceptional service, while remaining
flexible at all times, has shone through
this year. I would like to send my
thanks to all of our customers for
their continued support and loyalty
through this difficult time.
Our response to the
COVID-19 pandemic
Once we had ensured the protection
of our team and customers, the key
financial priority at the peak of the
crisis was to preserve cash, and the
measures taken have enabled us to
be highly cash generative in 2020.
The Board took swift and prudent
action to implement cost management
initiatives, including minimising
discretionary spend, rightsizing
departments, and making use of
available government support for
Mark Briffa
Chief Executive Officer
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Air Partner plc | Annual Report 2021
employees in areas of the business
that were most severely impacted.
This helped to ensure that we were
in the best shape possible to manage
our way through the extremely
unpredictable crisis.
As a reminder, Air Partner owns no
aircraft and is an asset light business,
which has certainly positioned us
well versus other aviation businesses
during the pandemic. Without monies
tied up in working capital and
underutilised assets, we have been
able to maintain our liquidity, which
has afforded us flexibility and agility
at a time of great uncertainty
and change.
In the early stages of the pandemic,
the Group took the decision to
publish regular market updates to
keep shareholders informed of our
performance. We released monthly
updates from March to July, detailing
our activity across all our services
and products, cost management
measures and cash position, to
provide transparency to our investors
during this extraordinary period.
Strategic progress
In line with our business strategy,
we continue to grow our world-class
global aviation services group to better
meet our customers’ ever‑evolving
needs, while improving the overall
quality of our earnings and reducing
our exposure to the volatility of the
charter market. The last financial year
firmly demonstrated the strength of
our stated strategy to diversify our
earnings so that the Group is not
reliant on any one product, market
or geography. This stood us in good
stead to navigate the extremely
challenging and uncertain marketplace
arising from COVID-19.
We saw a very strong performance
from the US, which offset weaker
results from the EU and certain UK
services. We were pleased to see
continued growth in the US region,
driven by Freight and Private Jets,
despite the pandemic. The US
Freight team was extremely active
flying PPE between Asia and the
US, and played a large role in FEMA’s
Project Airbridge, the US effort to
bring in medical supplies from
overseas, early in the pandemic.
The Freight team has also been
active in supporting the automotive
sector through supply chain
challenges. US Private Jets held up
far better than our other regions,
and we saw growth in our overall
customer numbers and JetCard
membership, with particularly
strong demand from high net worth
individuals (HNWI) for leisure travel.
The success of the US division is a
direct result of four years of significant
investment in the team and office
network, as the Group has sought to
establish itself as a truly global business
and lessen its reliance on revenues
from the UK, which was historically
always its strongest market. The US
accounted for 45.5% (FY20: 26.4%) of
the Group’s gross profit from Charter
services, and it is expected to be the
highest Charter contributor to the
Group’s profits in future years. This
expansion in the region has been
transformational for Air Partner and
it continues to be an area of strategic
focus across all product lines.
In terms of other locations in which
we have recently invested, the last
financial year marked the first
contribution from the Group’s office
in Singapore (opened in 2019), as the
team here played a key role supporting
the US Freight team on the logistics
of transporting large volumes of PPE
from Asia. We have invested further
in our operations here by increasing
our Freight presence. Our Dubai office,
which was also opened in 2019 with
a focus on Private Jets, has begun
to establish a customer base but
has not been able to reach its
full potential in the current
market conditions.
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Air Partner plc | Annual Report 2021
Chief Executive Officer’s review continued
Strategic progress continued
Further to our organic growth
objectives over the period, we also
continued to monitor acquisition
opportunities. At the end of 2020,
we acquired the trading assets of
CHS Engineering Ltd (CHS) after the
business went into administration.
CHS offered consultancy services for
airports and logistics operations,
remote condition monitoring and
baggage system testing. These
services will now be incorporated
into Air Partner’s Managed Services
offering and trade as Air Partner
CHS. This is a small acquisition but
one which extends our customer
offering further still, while sharing a
very similar customer base with the
rest of our Safety & Security division,
thereby presenting cross-selling
opportunities. The business is not
expected to be profit enhancing until
the second half of the year when
airports remobilise post lockdown.
Environmental, social and
governance (ESG)
As a company operating in
the aviation sector, Air Partner
is very focused on understanding
and improving the impact of its
operations on the environment
and society. We are committed
to developing and implementing
a long-term sustainability strategy
and to operating within a responsible
and sustainable framework. As part
of this, we appointed environmental
consultants Delta-Simons to help
us identify areas where we can add
value to the environment protection
effort. We have now defined the four
strategic pillars of our environmental
strategy as (a) carbon offsetting, (b)
charitable partnerships, (c) reduction
of resource consumption and (d)
transparency in reporting.
An environment working group
(EWG), consisting of representatives
across Air Partner’s functions and
geographies, considers ways to
implement each of the strategic
pillars, and proposes these to the
Group Executive Team, which has
ultimate responsibility for their
implementation. The Board receives
regular reports on the development
and activity of the sustainability
strategy. More information can be
found in the Sustainability section
of our Annual Report.
We are committed to recruiting
the best people to join our already
strong teams, improving engagement
and retention of our employees, and
positively impacting the economies
and communities in which we operate.
Given the challenging circumstances
of the pandemic, in the last financial
year we prioritised establishing new
ways of working, employee mental
health and wellbeing, and ensuring
regular and effective communication
between management and employees.
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Air Partner plc | Annual Report 2021
We launched a revised diversity and
inclusion policy, which reinforces our
commitment to constantly improving
our workplace culture. As part of
this, we conducted implicit bias
training sessions across the Group,
which received excellent feedback.
We remain committed to gender
and equal pay and will continue to
monitor and take action where it
is needed. The mental health and
wellbeing of all employees is a key
priority for us and we have undertaken
a number of activities around this,
including the development of a mental
health and wellbeing policy to increase
awareness and reduce stigmas.
An Employee Advisory Panel,
established in FY20, met throughout
the year, continuing to gather the
views of the workforce and act as a
conduit for two-way communication
with the Board. We also introduced
weekly CEO video updates throughout
the pandemic, monthly ‘All Hands’
virtual town hall meetings (with the
ability to ask questions anonymously)
and a new intranet platform.
In addition, we have refreshed our
volunteering policy, with up to two
days’ paid volunteering per year
available to staff. Since January,
a number of our employees have
volunteered at local vaccination
centres in the UK. At Christmas,
the Group also donated to several
charities in the communities in which
our main offices are based to help
the homeless and those in need.
‘The importance of putting our customers
first and providing exceptional service,
while remaining flexible at all times, has
shone through this year. I would like to
send my thanks to all of our customers
for their continued support and loyalty
through this difficult time.’
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Air Partner plc | Annual Report 2021
Charter underlying
operating profit
£14.5m
Charter statutory
operating profit
£13.9m
Charter gross profit
£39.1m
Charter gross transaction value
£262.4m
Charter
Overall, the Charter division
delivered £39.1m (FY20: £29.6m)
of gross profit for the 12 months to 31
January 2021, driven by the
exceptional H1 performance by
Group Charter and Freight, which
more than offset a weaker
performance in Private Jets. The
division contributed 87.1% to the
overall gross profit of the Group,
with Group Charter (including
Specialist Services) contributing
39.6%, Private Jets 20.7%, and
Freight 26.5%. Performance was
mixed across geographies, with the
US performing well, while others,
such as Europe, have struggled and
remain challenging in the face of
multiple lockdowns and restrictions.
Group Charter
Group Charter performed well in
the year, reporting gross profit of
£17.8m, up 21.1% on the prior year
(FY20: £14.7m), with strong results
coming out of the US and the UK
in particular. A key driver was the
delivery of emergency evacuation
flights around the world for the
UK government, international
corporations and the cruise industry.
Air Partner was able to provide
superior solutions due to our unique
ability to combine and coordinate
our Group Charter, Air Evacuation
and Safety & Security capabilities.
In addition, Group Charter saw high
demand for corporate shuttles, as
companies in the UK and US sought
to safeguard their employees. We
also carried out work in the sports
sector, flying sports teams to fixtures
safely and in line with local regulations
to enable the continuation of top tier
sporting events. However, there
has been a significant downturn in
our Tour Operations and Meetings,
Incentives, Conferences and
Exhibitions (MICE) business,
predominantly in Europe, as activities
in these areas have been deferred
until restrictions have been lifted.
As a result of the market conditions,
the Directors took the decision to
exit the UK Travel Agency market,
which will be completed later this year.
Within our Specialist Services
offering, Air Partner Remarketing
arranged the sale of an ATR72
for Heritaviation, as well as three
B747-400s and two PW4000
engines for Corsair. A consultancy
agreement was made with an airline
to renegotiate its leases on new
aircraft, and a substantial Aircraft,
Crew, Maintenance and Insurance
(ACMI) project was also completed
in the year. COVID-19 has impacted
the market for aircraft sales and
leasing but new mandates have
created a promising pipeline
for when the market recovers.
Air Evacuation had a strong year,
retaining 86% of its long-term
customers. Unsurprisingly, interest
in this product remains high due
to COVID-19 and the hurdles faced
for international travel.
Charter
The Charter division delivered £39.1m,
a growth of 32.1% on the prior year
Chief Executive Officer’s review continued
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26
Air Partner plc | Annual Report 2021
CASE STUDY:
Keeping critical supplies
moving during COVID-19
The Freight team carried out more
than 300 dedicated cargo flights
since February to support the urgent
demand for personal protective
equipment (PPE), COVID-19 test kits
and supplies for the manufacture of
the COVID-19 vaccine.
Throughout the pandemic, with the
changing availability and supply,
we were able to use our extensive
experience to charter numerous
passenger configured aircraft to
move urgent PPE cargo, as an
innovative approach to overcome
the global cargo aircraft capacity
crunch during the height of the
COVID-19 pandemic.
‘We’ve worked with our clients
around the clock to ensure critical
supplies arrived safely and as quickly
as possible to the places and people
that needed them most during
these challenging times,’ said
David McCown, President
of Air Partner US.
As part of this work, we supported
a US based freight forwarder in its
participation in a COVID-19 emergency
response initiative led by the Federal
Emergency Management Agency
(FEMA). Identifying the best aircraft
charter solutions for our client allowed
it to expedite the delivery of medical
supplies, such as N95 masks, surgical
gowns and gloves, from international
manufacturers to points across the US.
During the height of the COVID-19
pandemic, we also helped the
client in the urgent transportation
of more than 5,000 experimental
COVID-19 test kits from South Korea
to Washington, D.C. The test kits
were shipped under highly regulated
specifications in temperature
controlled containers and required
hourly temperature checks to ensure
they stayed inside the required frozen
range throughout the flight.
Our Freight division also expanded
in Asia and South Africa in 2020 due
to the increased demand.
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27
Air Partner plc | Annual Report 2021
Freight
It was an exceptionally strong year
for Freight, which delivered gross
profit of £11.9m, up 271.9% (FY20:
£3.2m). It was the most challenging
environment this area of our
business has ever seen, due to the
high levels of demand, urgent nature
of the projects, and additional
logistical requirements to ensure the
safety of the crews. Due to the volumes
of capacity required, the industry saw
many commercial passenger aircraft
being used for freight deliveries,
where regulations permitted, in
addition to typical freighters.
Our Freight team around the world
worked tirelessly and cohesively to
fly critical shipments of PPE from Asia
to the US, the UK and Europe
throughout the pandemic. Although
the US, the UK and Germany were
the primary contributors due to their
established customer bases, it was a
truly global effort, with the Singapore
and Turkey offices assisting with
aircraft supply and providing key
local knowledge so that we could
deliver a first-class service to our
customers. Over and above the
delivery of PPE, Freight also continued
to fly critical and high value goods
across the globe, with the US team
being particularly busy supporting
the automotive sector through supply
chain challenges.
Private Jets
It was a difficult year for Private Jets,
as regulations around lockdowns and
quarantines shifted constantly,
resulting in gross profit decreasing
20.5% to £9.3m (FY20: £11.7m). The
US was the best performing region
by some margin on account of both
our recent investment in the team
and the stronger private jet market
there. Although gross profit in the
US was lower year on year, we saw
a surge in new customers in the first
half of the year, as people sought
safer methods to return to their
homes during the first wave of the
pandemic. As a result, bookings
during the second half of the year
were up 10% on the prior year.
Overall, the number of Private Jets
customers in the US increased 23%
year on year, with new customer
numbers up 75%. Our US JetCard
programme also continued to grow,
with membership increasing 18%.
The UK and Europe were both down
year on year, in line with market
expectations. Private jet flights are
heavily weighted to the leisure
market and, unfortunately, a strong
summer was not enough to offset
the impact of global travel restrictions.
Some customers did still fly for
business-critical reasons, with
private jets taken to ensure the
health and safety of employees
flying. However, many businesses
have scaled back travel in light of the
economic impact of the pandemic.
We did, though, see an increase in
the number of first-time private jet
flyers mainly in the UK and the US
over the period, as people sought
flexibility and the safety of travelling
within their own bubble, with fewer
contact points.
Chief Executive Officer’s review continued
‘It was an exceptionally strong year
for our Freight division, which
delivered gross profit of £11.9m.’
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28
Air Partner plc | Annual Report 2021
CASE STUDY:
Growing our global
footprint
Air Partner expanded its Singapore
office and established its first
physical presence within Africa.
The expansion followed record growth
of the Freight division over the last
three years, with increased demand
throughout the global pandemic.
The COVID-19 pandemic uncovered
unexpected opportunities in the Asia
Pacific region. As manufacturing
hubs began to reopen after localised
lockdowns, Air Partner moved to
support clients with growing freight
requirements. Already established
in Singapore since 2019 as a Freight
office, Air Partner Group expanded
its Charter offering in Singapore to
provide the full range of service
offering including private jet hire
and Group Charter services.
As well as the growth in Asia, Africa
is fast becoming a growth market
for air freight, and the industry has
seen an increasing demand for services
in the region, with the International Air
Transport Association (IATA) reporting
a 7.4% increase in freight volumes
last year.
Longer term, through the expanded
presence in Asia and Africa the
Group will look to grow freight
forwarding and e-commerce
operations, as well as reestablishing
onboard courier (OBC) services
activity which was increasing in
demand pre-COVID-19.
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Air Partner plc | Annual Report 2021
Safety & Security gross profit for the
period was £5.8m (FY20: £4.6m).
There was greatly reduced demand
for many of these services during the
pandemic, as a number of our airport
and airline customers scaled back or,
in some cases, indefinitely delayed
operations. As result, we took UK
government support in the form of
furlough monies to protect jobs up
to December 2020. In its first year
of contribution, Redline was the
best performer within the division,
supporting other critical infrastructure
sectors and delivering software
related services.
Baines Simmons saw much lower
demand than usual, as airlines cut
almost all discretionary spending.
However, we successfully converted
many of our safety training courses
from classrooms to virtual delivery,
resulting in a significantly improved
performance during the second half
of the year, and we are seeing this
trend continue. Our Fatigue Risk
Management team (previously
Clockwork Research) also had a very
successful year delivering contracts
to well-known airlines and energy
customers, among others, as they
adapt to the new regulations for
COVID-19 compliance.
SafeSkys has now exited its Air
Traffic Control operations in the
UK, enabling it to focus solely on
its wildlife hazard management
offering. This area of our Managed
Services portfolio delivered
expected returns throughout the
year, as many regional military
airfields continued to operate
despite the pandemic.
We acquired Redline just before the
outbreak of COVID-19 and we have
been encouraged by its performance
during a particularly challenging
period, although its activities were,
of course, significantly impacted by
the pandemic. It secured a number
of business wins throughout the year
with a wide range of customers,
including those with international
facilities management company
OCS Group UK, the UK Civil Aviation
Authority (CAA), private aviation
company Jet Edge, supporting Align
JV on a HS2 project, and Nice,
Guernsey, Birmingham and Belfast
International airports.
In July, Redline was also appointed
to develop and deliver a robust
Security Management System for
ISS Australia and New Zealand,
marking Air Partner’s entry into the
Australian market. Good progress was
also made in terms of embedding
Air Partner’s culture, values, policies
and procedures, developing the
go-to-market brand (Air Partner
Safety & Security), and establishing
cross-functional teams to capitalise
on cross-selling opportunities within
the enlarged group.
Going forward, we remain confident
about the prospects for Redline and
we expect to see the true value of
this business come through in the
current financial year.
Safety & Security
The green shoots of recovery in our Safety & Security
division continue to grow as airports scale up operations
Safety & Security gross profit
£5.8m
Safety & Security gross
transaction value
£12.4m
Safety & Security underlying
operating profit
£0.0m
Safety & Security statutory
operating loss1
£2.6m
1 Statutory operating loss
includes £2.4m of
amortisation of intangible
assets arising on acquisition.
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Air Partner plc | Annual Report 2021
Chief Executive Officer’s review continued
CASE STUDY:
Diversifying our
earnings by investing
in security services
Although the aviation landscape has
been challenging throughout 2020,
Redline Assured Security, acquired
by Air Partner Group in December
2019, has seen a strong performance
with a number of new contract wins,
supporting clients with a wide range
of security services.
Redline expanded into the
Australasian market, being
appointed to deliver a robust
Security Management Systems
(SeMS) for ISS Australia and
New Zealand.
The system is a first of its kind in
Australia, enhancing ISS’s security
services across its aviation and
transport activities. ISS is one of
Australia’s largest facility services
providers, delivering security,
screening and facility services
across airports and ports in every
Australian state. Redline’s SeMS
focuses on all aspects of security
activity, supporting management
at all levels within an organisation.
All security tasks, such as quality
assurance activity, training
performance and audits, are
fed into the system, instantly
highlighting any exposed
vulnerabilities. This allows
management to maintain
control of risk in an ever-changing
threat environment.
As well as expanding into new
markets globally, Redline also has
seen success in other non-aviation
markets supporting customers in
sectors such as facilities
management, logistics and the
Department for Transport (DfT).
In total, Redline has now secured
43 new contract wins or renewals
since joining Air Partner in
December 2019.
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Air Partner plc | Annual Report 2021
The assets of CHS Engineering Ltd
were acquired towards the end of
the year after the company went
into administration. The company’s
expertise in airport logistics
operations and technical services
complement and expand the Group’s
existing Security portfolio, and we
foresee cross-selling opportunities
with the other areas of our Safety
& Security division. We expect that
this part of the business will become
profit enhancing during the next
financial year.
Current trading and outlook
We have enjoyed an encouraging
start to our current financial year,
with the first quarter exceeding
management’s expectations, and
we are optimistic for the months
ahead. Trading levels for Q2 are
also expected to be ahead of
management’s original forecast,
subject to government restrictions
being lifted. As a result, our base
case expectation for the current year
is now to deliver profits in excess of
those generated in the year ended
31 January 2020, where we achieved
underlying profit before tax of
£4.2m, despite the global reduction
in airline passenger numbers due to
the pandemic.
The strong performance from our
US Private Jets and Freight has
continued into this year, with the
latter assisting with the vaccination
roll-out by moving large shipments of
raw materials used in the manufacture
of vaccine vials. In the UK and Europe,
our Group Charter team continues
to work with governments and the
sports sector, although Private Jets
bookings in the UK and Europe
remain slower due to ongoing travel
restrictions. However, pleasingly,
JetCard sales and deposits are strong
in both the UK and US. We expect to
see an improvement in Private Jets
activity in the summer as restrictions
lift and the vaccine roll-out drives a
return of business and leisure travel.
The green shoots of recovery in our
Safety & Security division continue
to grow as airports scale up
operations in preparation for flying
during the summer season, the
length of which will be dictated by
when governments lift lockdown
measures and relax restrictions.
We are seeing demand return for
Redline’s range of security services
and the order book is now at its
highest point since the pandemic took
hold. In its first full year of ownership,
we are greatly encouraged by the
progress Redline is making within
the Group and are confident it will
go from strength to strength.
We still have a lot of headroom to
grow and so we shall continue to
pursue our organic growth initiatives
and assess targeted acquisition
opportunities that meet our strict
criteria and align with our strategic
objectives to extend our customer
offering and improve the visibility
of our earnings.
Finally, I would like to thank the
collective Air Partner team once
again for all its hard work throughout
the pandemic. It has certainly not
been easy but its commitment to both
the Group and our customers has been
unwavering and truly inspiring.
Mark Briffa
Chief Executive Officer
11 May 2021
Chief Executive Officer’s review continued
‘We have enjoyed an
encouraging start to our
current financial year, with
the first quarter exceeding
management’s expectations,
and we are optimistic for
the months ahead.’
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32
Air Partner plc | Annual Report 2021
In an extraordinary year, we have
demonstrated the inherent strength
of our business model, delivering an
excellent set of results in which the
true value and impact of our strategy
shines through. We have built a strong
business that is diversified by product
and geography, so that we are not over
reliant on any one revenue stream. The
benefits of this model have never been
clearer than in the last financial year
as different areas of the Group have
been affected by the impact of the
global pandemic in varying ways.
We are encouraged by the
performance of Redline in its
first full year of ownership, despite
the challenging environment. It won
a number of new contracts and is
now seeing demand rebound from
airport customers as they plan for
a re‑emergence post lockdown.
We are confident that Redline, along
with the rest of the Safety & Security
division, is well positioned to benefit
from significantly increased levels
of activity as the travel industry
opens up and airports remobilise.
Our key financial priority at
the onset of the pandemic was
the preservation of cash and we
took several actions in this area to
strengthen our position. Cost saving
measures included salary reductions,
tight control over discretionary spend,
reorganisational activities and a
reduction in our property footprint.
Actions taken to preserve cash
included the withdrawal of the final
dividend payment relating to FY20
and an overall reduction in capital
expenditure for the year.
In June 2020, we raised £7.5m from
a successful, oversubscribed fundraise,
which enabled us to repay the debt
taken on at the time of the Redline
acquisition and increase our working
capital to fund organic growth
initiatives, such as growth in our
Freight business and an increase
in governmental contract work.
Chief Financial Officer’s review
Joanne Estell
Chief Financial Officer
Prudent cash management and the
strong trading performance during
the year have enabled us to be highly
cash generative. Thanks to the
significant and swift actions we took
in FY21, we are strongly positioned
for the coming year.
Gross transaction value and revenue
Air Partner uses gross profit as its
key indicator of business performance.
This is due to the potential for revenue,
as determined under IFRS, to
fluctuate depending on the number
of contracts enacted in the year
where the Group acts as principal
as opposed to an agent. The Charter
division, which accounts for 87.1%
(FY20: 86.5%) of the total gross profit,
is the area of the business where we
predominantly act as an agent. For
the sake of completeness, commentary
below is given on gross transaction
value (GTV) and revenues.
Strategic report
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Air Partner plc | Annual Report 2021
Gross transaction value and revenue
continued
GTV of £274.8m (FY20: £236.8m)
was up by 16.0%, which is principally
due to the increase in Freight activity,
as described in more detail in the
gross profit section below. GTV
represents the total value invoiced
to customers and is stated exclusive
of value added tax.
Revenue of £71.2m (FY20: £66.7m)
represented a smaller year-on-year
increase of 6.7%, due to a lower
proportion of income coming from
transactions where the Group acted
as principal.
Gross profit
Gross profit of £44.9m was up 31.3%
against the prior period (FY20: £34.2m).
On a comparative basis, adjusting for
the full year impact of the Redline
acquisition, gross profit increased by
24.3%. Constant exchange rates had
a negligible impact on year on year
gross profit movement.
At a divisional level, the gross profit
of the Charter division was up 32.1%
on the prior year at £39.1m (FY20:
£29.6m). This growth was driven by
the exceptional levels of activity in
Group Charter and Freight during
the first half of the year, carrying out
repatriations and PPE flying as a
result of the pandemic.
Private Jets, Travel and Tour Operations
were all impacted by COVID-19 travel
restrictions. After a critical appraisal
of the UK Travel Agency business, the
Directors took the decision to exit the
market and completion is expected
in the second half of FY22. The
Group’s Travel Agency business is
currently consolidated into Group
Charter. Exiting this business is not
expected to have a material impact
on the underlying performance of
Group Charter going forwards.
Breaking the Charter division down
into its constituent parts, Group
Charter’s gross profit of £17.8m
was a year-on-year increase of 21.1%
(FY20: £14.7m). This came predominantly
from COVID-19 evacuations earned
in the UK and US. Conversely, due
to tighter travel restrictions, gross
profit in Europe was down due to
its dependency on Tour Operations,
which all but stopped as a result of
the pandemic. Within Group Charter,
the reduction in Tour Operations and
Travel Agency activity, which are
typically high volume, low margin
businesses, has resulted in the gross
profit to GTV margin increasing to
22.9%, compared to 10.7% in FY20.
Depending on the rate of recovery
of these businesses, we would
expect this margin to reduce while
noting our decision to exit the low
margin UK Travel Agency business.
Travel restrictions have resulted in
Private Jets gross profit decreasing
by 20.5% to £9.3m from £11.7m in
FY20 due to lower levels of activity
in the UK and Europe. Although a
significant decrease year on year,
this is still considerably stronger than
the overall trend in aviation revenue
passenger kilometres, which saw a
sharp decline of 66% for the 2020
calendar year (source: IATA –
Air Passenger Market Analysis,
December 2020). The Directors
expect to see a strong recovery in
this sector in the second half of the
current financial year as lockdown
measures are eased. We continue
to invest in the growth potential
of Private Jets, particularly in the
US, through talent acquisition and
technology investment in our
JetCard programme.
Freight was the standout performer
of the year, generating £11.9m of
gross profit, an increase of 271.9%
year on year (FY20: £3.2m), as a
result of extensive PPE flying. Although
the increase was driven by the
exceptional levels of trading in the
US, all Freight offices saw significant
increases on prior year results.
As alluded to above, the high levels of
trading in Group Charter and Freight
in the US have significantly changed
the Group’s regional mix. US Charter
gross profit increased by £10.0m year
on year to £17.8m (FY20: £7.8m) and
now contributes 45.5% to Charter
Group gross profit, compared to
26.4% in the prior period. As a result,
UK Charter now accounts for 36.8%
of Charter gross profit, compared to
43.2% in the prior year, despite a
£1.6m increase in gross profit. Europe
is the only geographic segment that
saw a decline in gross profit year on
year to £5.3m, while the Dubai and
Singapore offices increased Rest of
the world gross profit to £1.5m
(FY20: £0.2m).
Safety & Security delivered gross
profit of £5.8m (FY20: £4.6m), an
increase of 26.1%, which is attributable
to the full year impact of Redline.
On a true like-for-like basis, the division
declined by 31.0% year on year. This
reflects the fact that the many of the
services provided by our Safety &
Security division were viewed as
discretionary spend by our customers,
especially in the aviation industry.
In addition, within gross profit for
Safety & Security is £0.4m of UK
government support monies as
a result of employees, who are
charged as a direct cost of sale,
being on furlough for a number
of months during the year, in areas
of the business where work had
effectively dried up.
Despite the decline in gross profit,
the Directors remain confident that
the Safety & Security division is well
positioned to recover. Redline and
Clockwork have won a number of
contracts from non-aviation customers,
while Baines Simmons has been
adapting its courses for online
learning. In addition, the newly
acquired CHS has very similar
customers to the rest of our division,
offering an opportunity to cross-sell
additional products and services.
Administrative expenses
Costs included in administrative
expenses in the consolidated
income statement are personnel
costs, sales and marketing, finance,
information systems, human resource
management, legal and compliance,
and other administrative costs.
Underlying administrative costs,
excluding net impairment losses
on financial assets, were £32.1m
(FY20: £29.2m), an increase of
9.9%, despite the cost cutting and
restructuring undertaken, because
Chief Financial Officer’s review continued
Strategic report
34
Air Partner plc | Annual Report 2021
of the pandemic (see Exceptional and
other items). The increase is driven
by higher commission payments and
other remuneration effects resulting
from the strong trading performance
(£3.7m), and a full year of overheads
for Redline (£2.3m). This has been
offset by £1.3m of government
support for areas of the business
that have been significantly impacted
by COVID-19*. Adjusting for these
effects, administrative costs decreased
year on year by £1.7m, reflecting the
numerous cost-cutting initiatives
taken during the year.
Net impairment losses of £0.8m
(FY20: £0.2m) represent provisions
for irrecoverable balances made
during the period. The Group has
entered legal proceedings against a
customer with an outstanding balance
of £0.3m and the case is still ongoing.
As a result of the impact of the
pandemic, the Group has provided
for £0.4m of balances which are no
longer considered recoverable and
has increased its IFRS 9 credit loss
provision by a further £0.1m.
In order to progress our strategy,
while remaining mindful of the risks
and ongoing effects of COVID-19,
the Group expects to make further
investments in administrative expenses
as we grow organically across new
locations. The cost benefit analysis
of any initiative will be assessed at
the appropriate time against the
Group’s investment criteria.
* Total of £1.7m taken at Group level, £0.4m
relating to employees whose costs are
recognised within costs of sales and the
government grant matched to this.
Underlying operating profit
Underlying operating profit
has increased 150.0% to £12.0m
(FY20: £4.8m). As referenced in
the preceding sections, performance
has varied considerably across the
products and services. Underlying
operating profit by sector is stated
after the allocation of attributable
central support costs.
Freight has seen the largest increase
in underlying profit, producing £6.7m
compared to £0.2m in FY20. Freight
has a relatively low cost base, so the
high trading volumes converted
strongly to operating profit. Group
Charter also performed strongly,
increasing operating profit by
£3.3m to £6.4m (FY20: £3.1m),
despite the reduction in its Tour
Operations business. Private Jets
saw underlying operating profit fall
from £2.6m in FY20 to £1.4m with
a mixed performance across the
Group. The US was the standout
performer in this area.
The decline in Tour Operations,
combined with the performance of
Private Jets, has resulted in underlying
operating losses being recorded by
the countries where these are the
primary revenue drivers. France and
Italy have been particularly affected
and are loss making, despite the
government support taken for
staff costs.
The Safety & Security division
produced a break-even result
(FY20: £0.9m), because of the limited
trading opportunities in the year.
This was inclusive of the government
support of £0.6m taken for staff
costs, included within cost of sales
and administrative expenses, which
are higher in this division.
The remaining underlying profit is
comprised of a loss of £2.4m (FY20:
£2.1m), relating to corporate costs
that are not assignable to any division.
The year on year increase reflects
the increased performance based
remuneration to senior management
to reflect the Group’s performance.
Finance costs
The net interest charge for the
year was £0.5m (FY20: £0.5m). The
charge reflects the interest payable
on finance leases recognised under
IFRS 16 and interest on the Group’s
revolving credit facility (RCF). The
Group repaid the RCF balance in full
at the end of the first half of the year
and, as a result, expects borrowing
costs to decrease going forward.
Underlying profit before tax
The above results translated to
record underlying* profit before tax
of £11.6m for the Group, an increase
of £7.4m (176.2%) from the prior year
(FY20: £4.2m). On a comparative
basis, adjusting for the full year
impact of the Redline acquisition,
underlying profit before tax increased
by 182.5%. Adjusting for constant
exchange rates had a negligible impact
on year on year profit movement.
* Underlying earnings are stated before
exceptional and other items, see note 7
in the financial statements.
Exceptional and other items
Exceptional items are excluded from
underlying performance measures
by virtue of their size and nature, in
order to better reflect management’s
view of the performance of the
Group. In the year under review, the
net effect of exceptional and other
items on operating profit was
£3.2m (FY20: £3.3m).
Exceptional and other items excluded from underlying profits in the period
are broken down as follows:
2021
2020
£m
£m
Underlying profit before tax
11.6
4.2
Change of Board composition
—
(0.2)
Restructuring costs
(0.8)
—
Amortisation of purchased intangibles
(2.4)
(0.6)
Acquisition costs
—
(0.6)
Disposal of subsidiary
—
—
Cost incurred and provision for outflows resulting from
French tax investigation
—
(0.7)
Impairment of goodwill
—
(1.9)
Settlement of historical legal disputes
—
0.4
Release of deferred consideration
—
0.3
Statutory reported profit before tax
8.4
0.9
Strategic report
35
Air Partner plc | Annual Report 2021
Exceptional and other items continued
In total, there is a £3.2m exceptional
charge on the consolidated income
statement for the year, comprising
£2.4m of amortisation of acquired
intangibles and £0.8m of restructuring
costs incurred across the Group. The
latter were incurred as a result of an
assessment of the Group’s headcount
requirements, exiting the UK Travel
Agency market and a reduction in the
office footprint of the Group in the
wake of COVID-19. The remaining
exceptional costs relate to the disposal
of our Swiss subsidiary, the release
of a provision for acquisition costs,
and present valuing of the deferred
consideration on acquisition of Redline,
which all net to below £100k. They are
mentioned here for full transparency
and to be consistent with the prior
year approach.
Further information and details of
the prior year figures are provided in
note 7 – Exceptional and other items
in the financial statements.
Statutory reported profit before tax
Reflecting the strong trading period
of the Group, statutory reported
profit before tax, after the above
exceptional and other items, was
£8.4m (FY20: £0.9m).
Taxation
The Group seeks to manage the cost
of taxation in a responsible manner
to enhance its competitive position
on a global basis while managing its
relationships with tax authorities on
the basis of full disclosure and
legal compliance.
On a statutory reported profit basis,
the effective rate of taxation was
32.8% (FY20: 67.6%). The high tax
rate in the prior year was due to the
level of exceptional costs which did
not attract tax relief.
The underlying tax charge* of
£3.0m (FY20: £0.9m) represents an
effective rate of 26.6% (FY20: 20.5%)
on the underlying profits before tax.
The higher tax rate reflects the
greater share of profits in countries
with higher tax rates, in particular
the US, and losses in other tax
jurisdictions, on which we have
Chief Financial Officer’s review continued
chosen not to recognise the deferred
tax assets as the recoverability is not
sufficiently certain at this time.
* Adjusting for exceptional and other items.
Earnings per share
Basic underlying* earnings per
share from continuing operations was
14.2p (FY20: 6.4p), up 121.9% on the
prior year. On a statutory basis, basic
earnings per share from continuing
operations was 9.4p (FY20: 0.6p).
* Underlying earnings are stated before
exceptional and other items, see note 7
in the financial statements.
Dividends
The Board has reviewed its dividend
policy so as to ensure that the Group
has the ability to pay a sustainable
and growing level of dividends over
time. Recognising the importance of
dividends to Air Partner’s shareholders,
we announced the reinstatement of
dividends at the interim results in
September 2020 with a payment of
0.8 pence per share. The Board is
now recommending a final dividend
of 1.6 pence per share, making a total
of 2.4 pence per share for the year
as a whole. The final dividend is
expected to be paid on 15 July 2021
to those shareholders on the share
register at close of business on
11 June 2021. The ex-dividend date
will be 10 June 2021.
Going forwards, the Board will
target dividend cover of 3.0 to
3.5 times earnings in a normal year,
after adding back non-cash related
exceptional items, such as amortisation
of acquired intangibles.
Statement of financial position
Shareholders’ funds
After considering the profit for
the period, dividend payments,
exchange rate differences and
the share issue (see below), overall
shareholders’ funds at 31 January 2021
were £21.1m, representing an
increase of £11.9m on the position
at 31 January 2020 (£9.2m).
In June 2020, the Group completed
a cash box placing for 10 million new
shares in the capital of the Company.
The placing price was 75p per share.
The placing raised gross funds of
£7.5m and incurred fees approaching
£0.5m, resulting in a net increase in
equity of £7.1m. In accordance with
Section 612 of the Companies Act
2006, merger relief has been applied,
resulting in an increase to retained
earnings of £6.9m, with the remainder
going to share capital and share
premium. Share premium was only
recognised on shares issued as part
of an offer through PrimaryBid,
which did not qualify for merger relief.
Goodwill and intangibles
The carrying value of goodwill is £8.7m
(FY20: £8.6m), with the movement
relating to foreign exchange.
Intangible assets arising from business
combinations are assessed at the
time of acquisition in accordance
with IFRS 3 and are amortised over
their expected useful life. This
amortisation is excluded from
underlying profits. The net book
value of intangible assets is £9.3m
(FY20: £11.9m), comprising of
acquired intangible assets: customer
relationships, customer contracts,
software development costs and
internally generated software assets.
In the period, we invested
£0.2m (FY20: £0.4m) in software
development as we finalised and
subsequently rolled out our Charter
customer relationship management
system and completed our new
Charter and Group websites.
Other balances
The Group holds property, plant
and equipment totalling £6.0m
(FY20: £7.7m), of which £5.1m is held
on lease in accordance with IFRS 16
(FY20: £6.7m). Approximately 70%
of the IFRS 16 assets relate to the
right of use of an Italian aircraft where
the lease was due to expire at the
end of October 2021 but following
the year end, the contractual terms
and payment obligations have been
further delayed until 2022. Capital
expenditure in the period was £0.3m
(FY20: £0.5m) on property, plant
and equipment.
The net current asset position of the
Group has improved by £2.9m. The
main drivers have been a significant
Strategic report
36
Air Partner plc | Annual Report 2021
trading result in the period and a
cash injection from the shareholder
fundraise net of paying down all the
Group debt. Other balance sheet
movements are noted below.
The positive change in receivables
was driven by several factors,
including that COVID-19 related
activity did not attract customer
credit. We also restricted credit
terms wherever possible and the
parts of the business that typically
give credit did not have high levels of
trading during the period, i.e. Safety
& Security. This resulted in a positive
unwinding of the trade receivables
position in the year of £3.2m.
In addition, prepayments and accrued
income were £4.1m and £1.3m lower
than the prior year, respectively.
This was driven predominantly by
the shift in our business mix. Tour
Operations and Travel projects often
require deposits several months in
advance of the flying date and a
reduction in volume in these areas
contributed to the movement
in prepayments.
In line with the above, deferred
income has declined from £24.7m in
FY20 to £21.4m in FY21. It should be
noted that deferred income includes
JetCard balances, which increased
by £1.1m year on year. This shows
that, although our Private Jets
business has been negatively
impacted this year, our customers
still intend to use the balances once
travel restrictions have been eased.
Trade and other payables and other
liabilities have increased by £0.5m,
driven by the accrued costs for the
employee remuneration due because
of the strong trading performance.
The tax liability due has decreased
despite the higher charge for FY21,
as the Group has paid instalments in
line with the total expected annual
charge in most tax jurisdictions.
Overall, the aforementioned
movements resulted in a positive
working capital movement of
£6.5m in the period (FY20: negative
cash (non-JetCard cash less client
deposits and similar balances) as the
best assessment of available funds
in the business. This is due to the
expectation at the advent of the
pandemic that customers would
cancel bookings and pursue refunds.
Although this did not occur at the
levels expected, the Directors have
continued to use this measure as
a more meaningful approach to
cash management at this time.
The normalised cash balance after
adjusting for £1.6m of customer
deposits at 31 January 2021 was £8.3m.
Encouragingly, JetCard cash increased
by £1.1m to £17.8m (FY20: £16.7m).
JetCard cash is kept in separate
segregated bank accounts and is not
used for the Group’s working capital
needs. Including JetCard cash, the
Group held £27.7m cash at the
year end (FY20: £21.4m).
movement of £0.7m). This trend is
considered one-off and symptomatic
of the COVID-19 trading environment
we have experienced, and we fully
expect to invest in working capital
when more normalised levels of
trading resume and the parts of our
business that have suffered due to
the pandemic come back on line.
The Group has a non-current liability
for deferred consideration in relation
to the Redline acquisition of £1.0m
(FY20: £2.3m). £1.3m was paid to
the former owners of Redline
during the year in line with the
acquisition agreement.
Cash generation and net debt
Operating cash from trading
activities after investment in capital
expenditure and software was
£18.9m (FY20: £8.2m), reflecting
the higher profit in the year and
reduction in receivables.
In terms of financing activities, the
aforementioned issue of shares in
the period generated net additional
funds of £7.1m, which were used
to repay the RCF of £11.5m, in
combination with funds from
operating activities.
The above means that the Group
held net cash (cash offset by bank
debt) of £9.9m versus net debt
on the same basis of £6.9m at
31 January 2020, an increase of
£16.8m. The increase is despite
significant outflows in the year for
corporation tax (£4.5m), payment
of finance leases (£1.6m), deferred
consideration (£1.3m) and dividends
(£0.5m). In managing the Group’s
cash prudently during the year, the
Directors began to use normalised
Strategic report
37
Air Partner plc | Annual Report 2021
Chief Financial Officer’s review continued
Cash generation and net debt continued
The only borrowing remaining in the Group relates to the leases recognised
under IFRS 16, which include property leases, motor vehicles, office equipment
and the right of use of an Italian aircraft under a charter agreement that is
due to expire in Q3 of the next financial year. The total lease liabilities in current
and non-current liabilities amount to £5.9m (FY20: £7.3m).
Bank facilities
The Group has total debt facilities of £14.5m (FY20: £14.5m) comprising
a committed RCF of £13.0m (FY20: £14.5m) and a £1.5m overdraft. As at
31 January 2021, none of the RCF was drawn down (FY20: £11.5m) and the
overdraft was not utilised. The facility attracts an interest rate of 2.6% plus
LIBOR and non‑utilisation fees of 1.3% per annum and is repayable in
February 2023.
Exchange rates
The results of overseas operations are translated into Sterling at average
exchange rates. The net assets are translated at period end rates. The
principal exchange rates, expressed in terms of the value of Sterling, are
shown in the following table.
Average rates
31 January
2021
31 January
2020
USD
1.28
1.28
No movement
EUR
1.13
1.14
EUR strengthened by 0.9%
Period end rates
31 January
2021
31 January
2020
USD
1.37
1.32
USD weakened by 3.8%
EUR
1.13
1.19
EUR strengthened by 5.0%
Accounting policies and recent accounting developments
The accounts in this report are prepared under International Financial Reporting
Standards (IFRSs), and the applicable legal requirements of the Companies Act
2006. In addition to complying with international accounting standards in
conformity with the requirements of the Companies Act 2006, the consolidated
financial statements also comply with International Financial Reporting Standards
adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the
European Union. The accounting polices used in preparing these accounts
are set out in note 1 in the financial statements on page 121.
Treasury and risk management
Foreign currency effects
Where possible, the Group uses
natural hedges to minimise its
foreign exchange exposure, for
example matching JetCard deposits
denominated in Euro or US Dollar
with the respective liability. In
addition, the Group uses derivatives
to hedge certain transactions in
accordance with its internal policies.
Financial risks
The main financial risks faced by the
Group are credit risk, foreign currency
risk, interest rate risk and liquidity
risk. The Directors regularly review
and agree policies for managing
these risks.
Credit risk is managed by monitoring
limits and payment performance of
counterparties. The Directors consider
the level of general credit risk in current
market conditions to be higher than
normal. Where a customer is deemed
to represent a level of credit risk,
terms of trade are modified to limit
the Group’s exposure.
Foreign currency risk is managed by
matching payments and receipts in
foreign currency to minimise exposure.
Interest rate risk is managed by holding
a mixture of cash and borrowings in
Sterling, US Dollar and Euro at fixed
and floating rates of interest.
Liquidity risk is managed by the Group
having access to an RCF, which can
be used for working capital means,
and a moderate overdraft facility to
provide short-term flexibility.
Strategic report
38
Air Partner plc | Annual Report 2021
Going concern
The Group’s business activities,
together with the factors likely to
affect its future performance, are
set out in the Strategic report
and in the Principal risks and
uncertainties section.
The Directors believe that the Group
is well placed to manage its business
risks and, after reviewing the Group’s
current financial position, including
factors affecting its cost base, and
the availability of financing facilities
and forecasts for a period of not less
than 12 months from the date of
approval of these financial statements,
are satisfied that the Group has
adequate resources to continue in
business for the foreseeable future
and that the Company is a
going concern.
A summary of the going concern
assessment is provided in the Going
concern and viability statement on
pages 49 and 50.
Joanne Estell
Chief Financial Officer
11 May 2021
Strategic report
39
Air Partner plc | Annual Report 2021
Risk management
Risk management approach
Like many organisations, our business
involves constant risk management.
It is an integral part of day-to-day
operations. Effective risk management
is particularly important during a
period of growth and rapid change,
as was the case during the year,
particularly due to the COVID-19
pandemic. As a business we need
to make sure we manage the risks
to mitigate their impact and turn
them into opportunities.
As part of our risk management
strategy, we have implemented a
proportionate and effective risk
management framework to ensure
all significant risks are identified
and treated appropriately on a
timely basis.
The process is designed to support
delivery of our business objectives,
protect the interests of our
stakeholders, and enhance the
quality of our decision making
through the awareness of risk-
assessed outcomes. It also facilitates
open communication on risk
between the Board, the Audit and
Risk Committee and the Group
Executive Team, and the newly
created Risk and Compliance
working group (more details on the
latter can be found on page 62).
This approach enables us to manage
and monitor the risks which could
threaten the successful execution of
our strategy and ensures that our
strategic, financial and operational
risks are appropriately considered
by the Board, the Audit and Risk
Committee and the Group
Executive Team.
Principal risks and uncertainties
A key component to our operations
Strategic report
40
Air Partner plc | Annual Report 2021
Risk analysis
The Board and the Group
Executive Team analysed and
prioritised the identified risks, with
a focus on those considered to
pose the greatest risk to achieving
our objectives.
Regular review
On behalf of the Audit and Risk
Committee, the Head of Risk and
Compliance, together with the risk and
compliance working group, monitored
the application and effectiveness of the
risk management framework and the risk
treatment plans. This involved developing
and managing policies and control
frameworks across all aspects of
the business.
Risk governance
The Board and its Committees set the culture and
approve the strategy for the Group. The Board ensures
appropriate oversight and monitoring through a number
of mechanisms, including strategic review meetings,
Committee meetings, management reports and focused
reviews on the strategy risk areas.
On behalf of the Board, the Audit and Risk Committee
has oversight of the enterprise risk management (ERM)
framework ensuring that it is effectively deployed
throughout the Group. The Committee is satisfied that
management has put in place a proportionate and
effective risk management framework to ensure all
significant risks are identified and treated appropriately.
The Chief Executive Officer (CEO) has overall
accountability for the control and management of risk.
The individual members of the Group Executive Team,
reporting to the CEO, are accountable for specific risks.
The Group Executive Team is assisted by the risk and
compliance working group in defining the risk
management strategy.
Treatment plans
and controls
The Group Executive Team
implemented risk treatment
activity through regular
reviews and its general
oversight of the day-to-day
running of the business.
The Group Executive
Team was also responsible
for adherence to the risk
management process.
Risk governance
The Audit and Risk
Committee received regular
updates on the main risks
faced by the Group from
both the Chief Financial
Officer and the Head of
Risk and Compliance.
Risk assessment
The Group Executive Team,
assisted by the risk and
compliance working group,
identified and assessed new and
existing risks over the course of
the year as the Group’s overall risk
profile continued to evolve. A full
and complete risk register is
maintained and regularly updated.
Identify
Measure
Manage
Monitor
Report
Our risk
management
framework
‘The Committee is satisfied that
management has put in place a
proportionate and effective risk
management framework.’
Enterprise risk management (ERM) framework
Strategic report
41
Air Partner plc | Annual Report 2021
Principal risks and uncertainties continued
Risk categorisation
We have identified six risk categories to ensure sufficient focus and clear ownership:
The Group’s risk register is
maintained to record all principal
risks and uncertainties identified in
each part of the business.
‣ A member of the Group Executive
Team is allocated as the risk owner
for each of the risks identified, as
appropriate.
Contractual
and
counterparty
risks
Compliance
and internal
control risks
Financial risks
Environment
and market
risks
Strategic
risks
Operational
risks
Risk categories
The risk owners conduct an analysis
of each risk, according to a defined
set of assessment criteria, including:
‣ How does the risk relate to
the Group’s business model and/
or strategy?
‣ What is the likelihood of the risk
occurring?
‣ What is the potential impact
should the risk occur?
‣ What would the consequences
be over the short, medium or
long term?
‣ What mitigating actions
are available?
‣ What is the degree of residual risk
and is it acceptable?
Strategic report
42
Air Partner plc | Annual Report 2021
Risk heatmap
The principal risks facing
the organisation, at the
signing of the accounts,
are summarised in a
heatmap opposite and
provided in more detail on
pages 44 to 48.
Key
High
Medium
Low
Risk
Category
Movement
Risk owner
1
People
Operational
Craig Pattison, Chief People and
Technology Officer
2
Changing market environment
Environment and
market
Kevin Macnaughton, Managing Director, Charter
David McCown, President, Air Partner Americas
Paul Mason, Managing Director, Safety & Security
3
Environmental concerns
Environment and
market
Kevin Macnaughton, Managing Director, Charter
David McCown, President, Air Partner Americas
Paul Mason, Managing Director, Safety & Security
4
Cybersecurity and IT systems
Operational
Craig Pattison, Chief People and
Technology Officer
5
Growth – geographical expansion,
acquisition and integration risk
Strategic
Mark Briffa, CEO
6
Legal, regulatory environment, ethics and
compliance
Compliance and
internal control
Judith Banks, General Counsel and
Company Secretary
Joanne Estell, CFO
7
Operators and other charter supply chain
Contract and
counterparty
Kevin Macnaughton, Managing Director, Charter
David McCown, President, Air Partner Americas
8
Financial management and performance,
including COVID-19
Financial
performance
Joanne Estell, CFO
9
Effective control environment
Compliance and
internal control
Mark Briffa, CEO
Joanne Estell, CFO
Str
ate
gic
En
vir
on
me
nt
an
d
ma
rke
t
Op
era
tio
na
l
Co
ntr
act
a
nd
c
ou
nte
rp
art
y
Co
mp
lia
nc
e a
nd
in
ter
nal
c
on
tro
l
Fi
na
nci
al
pe
rfo
rm
an
ce
Change in risk assessment:
No change
Increased
Decreased
Strategic report
43
Air Partner plc | Annual Report 2021
5
8
6
7
4
1
3
9
2
Principal risks and uncertainties continued
Category
Risk description
Potential impact
Controls/processes to mitigate
Areas of
strategy
impacted
Operational
People
‣
Impact of COVID-19 on the
workforce’s wellbeing, mental
health and engagement while
working remotely to ensure
their safety.
‣
Maintaining effective
leadership, engendering a
culture of compliance with our
values and policies. See page 63
for Company values.
‣
Attracting new talent and
retaining existing key staff
who have in-depth knowledge
of the business and industry.
‣
Loss of productivity,
high sickness rates
and employee fatigue
due to negative
COVID-19 impact.
‣
Loss of earnings and
key customer/supplier
contacts through lack
of effective leadership
and inability to attract
and retain key
individuals.
‣
The loss of key
personnel following
acquisitions may
impact performance
and value.
‣
Numerous initiatives to assist
with maintaining the workforce’s
wellbeing, mental health and
engagement. Details of these
initiatives can be found on
pages 56 and 57.
‣
Continuous monitoring of
COVID-19 restrictions in every
jurisdiction in which we operate.
‣
Leadership development
programme in second year
of operation.
‣
Talent and succession plan reviews.
‣
Remuneration packages evaluated
regularly against market trends.
‣
Clearly defined people integration
plan for acquisitions.
‣
Diversity and inclusion initiatives
(details of these initiatives can be
found on page 76).
‣
Owner: Craig Pattison, Chief
People and Technology Officer
‣
Customers.
‣
Developing
and
retaining
our people.
‣
Growing
organically.
‣
Broadening
our offer.
Environment
and market
Changing market
environment
‣
Air charter bookings and
the sale of safety and security
products and services can be
materially impacted by changes
in financial markets, political
instability and natural events
such as COVID-19 affecting the
movement of people or cargo,
and the airlines’ and airports’
ability to invest in safety and
security products and services.
‣
Financial challenges facing
operators and the consequent
lack of availability of capacity
continues to be a risk factor
for our Charter division.
‣
Risk of falling behind
competitors in product
development, technology
innovation, standards of
service or cost effectiveness.
‣
Particularly in the Charter
division, challenge of retaining
and attracting customers in a
highly competitive environment
with low barriers to entry.
‣
Reduced gross profit
and revenues.
‣
Cost structure not
aligning with market
conditions showing
reduced charter
availability and lack
of investment in safety
and security products
and services.
‣
The risk of long-term
social distancing and
the sporadic peaks
around the global
COVID-19 pandemic
could result in a
laboured return to
normal air travel and
reduced levels of
trading into 2022.
‣
Diversification of client base, and
of product and service offering,
including through cross-selling
between our Charter and Safety
& Security divisions and through
seeking long-term partnerships
with customers.
‣
Monitoring of the charter operator
market with which we maintain a
close relationship, and diversification
of our supply chain across the
regions in which we operate.
‣
We actively seek to improve the
forward visibility of our earnings by
investing in the growth of our Safety
& Security division, which typically
has more long-term contracts and
strong order book coverage. This
will help smooth the inevitable peaks
and troughs in the Charter division.
‣
Expanding operations in high
growth markets and regions, which
are currently underserved,
including Asia and the Middle East.
‣
Close monitoring of overheads
and investment spend relative to
revenues and gross profit and
immediate corrective actions taken
where necessary.
‣
Investing in the customer experience
and changing needs, based on
customer feedback (including via
customer survey), and reviewing
technology innovations in the sector.
‣
Rebranding and new website.
‣
Owners: Kevin Macnaughton,
Managing Director, Charter
‣
David McCown, President, Air
Partner Americas
‣
Paul Mason, Managing Director,
Safety & Security
‣
Customers.
‣
Growing
organically.
‣
Maintaining
brand value.
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44
Air Partner plc | Annual Report 2021
Category
Risk description
Potential impact
Controls/processes to mitigate
Areas of
strategy
impacted
Environment
and market
Environmental concerns
‣
The impact of our stakeholders’
concerns in respect of air travel
on the environment, in
particular private jets, and the
possible reduction in demand.
‣
The impact on the aviation
industry if there are
governmental and regulatory
changes in respect of the
climate change agenda.
‣
Lack of investment in
Air Partner, existing
shareholders selling
their stock and
difficulty in finding
new investors.
‣
Lack of employee
engagement.
‣
Reduction of
customer base.
‣
We are considering further
measures to ease environmental
concerns, including carbon
offsetting opportunities, and
reduction of internal resource
consumption. See the Sustainability
section on pages 52 to 55, detailing
our environment strategy.
‣
Owner: Mark Briffa, CEO
‣
Customers.
‣
Growing
organically.
Operational
Cybersecurity and
IT systems
‣
Cyber attacks seeking to
compromise the confidentiality,
integrity and availability of data
held on IT systems.
‣
IT failure impacting our
ability to operate and not
recovering quickly.
‣
Risks from social engineering
and potential losses through
fraud and theft.
‣
The dependency on resilient
IT systems and the reliance
on homeworking during the
COVID-19 pandemic have
heightened the risk of breach
as fraudsters have looked to
capitalise on the situation.
‣
Breaches of
confidentiality and
attacks on our assets
could affect customer
service, financial
performance and
reputation.
‣
Systems failure could
result in business
interruption and lost
revenue.
‣
Financial losses
through payment
deception.
‣
The Group uses modern IT
systems and technical controls
and processes and ensures that
they are well maintained and
upgraded regularly to mitigate
the risk of failure.
‣
Most key data and applications
have enhanced backup capabilities
and resilience.
‣
Appropriate investment in training
and resources to counteract
cyber threats and support
increased homeworking.
‣
Our business resilience is
underpinned by our technology
and geographical spread, which
allow our business to be operated
and maintained from any of
our locations.
‣
Cyber insurance in place to
mitigate the impact of any
cyber related losses.
‣
Owner: Craig Pattison, Group
People and Technology Officer
‣
Customers.
‣
Maintaining
brand value.
Strategic
Growth – geographical
expansion, acquisitions
and integration risk
‣
Risk related to organic growth
and complementary
acquisitions in aviation services.
‣
Risk that investment in new
offices (e.g. Singapore and
Dubai) does not deliver the
expected returns relative to
the business case.
‣
Investment of funds and
resources in acquisitions
which fail to deliver on
expectations due to incorrect
due diligence or poor
integration post acquisition.
‣
Business growth puts
pressure on all
resources in an
organisation that may
not have had the time
to scale up or
adequately plan for
the change.
‣
Poor acquisitions lead
directly to financial
damage and indirectly
to reduced shareholder
confidence.
‣
Financial performance
suffers from goodwill
or other impairment
charges.
‣
Newly acquired
businesses deliver less
value or require more
investment than
anticipated.
‣
Added governance in the review
of business cases with the creation
of the operational Strategic
Investment Board established to
assess the relative merits of
internal business cases and
investment propositions.
‣
Detailed due diligence in any
acquisition process undertaken
with appropriately skilled
personnel, supported internally
and externally as required.
‣
Appropriate representations and
warranties negotiated with the
sellers of any business acquired,
commensurate with target’s size
and risk profile.
‣
Detailed integration plans drawn
up with key accountabilities.
‣
Post-acquisition reviews
conducted to capture key
learnings for future acquisitions
and business cases.
‣
Owner: Mark Briffa, CEO
‣
Broadening
our offer.
‣
Customers.
‣
Growing
organically.
Change in risk assessment:
No change
Increased
Decreased
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45
Air Partner plc | Annual Report 2021
Principal risks and uncertainties continued
Category
Risk description
Potential impact
Controls/processes to mitigate
Areas of
strategy
impacted
Compliance
and internal
controls
Legal, regulatory
environment, ethics
and compliance
‣
The challenge of operating in
multiple jurisdictions that are
subject to many different and
evolving laws and regulations.
‣
We have c.420 employees in a
number of countries. Individuals
may not all behave in
accordance with our values and
ethical standards.
‣
We operate in markets requiring
strict adherence to laws such as:
‣
bribery and corruption;
‣
money laundering;
‣
international trade law and
sanctions;
‣
human rights and modern
slavery;
‣
international labour
standards;
‣
government contracting
regulations; and
‣
General Data Protection
Regulation (GDPR).
‣
We operate across many
different tax jurisdictions and
are subject to periodic
tax audits, which sometimes
challenge the basis on which
local tax has been calculated
and/or withheld.
‣
Ethics or other
compliance breaches
cause harm to our
reputation, financial
performance, customer
relationships and ability
to attract and retain
talent.
‣
Successful challenges
by local tax authorities
may have an adverse
impact on profitability
and cash flow.
‣
The Group has a dedicated
legal resource supplemented by
external support arrangements to
ensure the management team fully
understands current and future
legal and regulatory risk.
‣
The risk and compliance working
group was formed to support
governance on risks and advise on
mitigation strategies in this area.
The implementation of the Group’s
risk management and compliance
programme is a regular agenda
item at the Group Executive Team,
Board and Audit and Risk
Committee meetings.
‣
Group-wide ethics framework
which includes our values and
training on such matters as: data
privacy, market abuse regulation,
confidentiality, conflicts of
interest, whistleblowing, modern
slavery, trade compliance and
money laundering.
‣
Ongoing programme to ensure
that all businesses are compliant
with data privacy requirements
including GDPR.
‣
Multiple sources to assess culture
including surveys, ‘Speak Out’ and
exit interviews.
‣
Central monitoring of any tax
investigations with independent
tax advice taken where necessary.
‣
Owners: Judith Banks, General
Counsel and Company Secretary
‣
Joanne Estell, Chief
Financial Officer
‣
Customers.
‣
Developing
and
retaining
our people.
‣
Maintaining
brand value.
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Air Partner plc | Annual Report 2021
Category
Risk description
Potential impact
Controls/processes to mitigate
Areas of
strategy
impacted
Contractual
and
counterparty
Operators and other
charter suppliers
‣
Reliance on third party airline
operators in the Charter division
for delivery of services to our
customers.
‣
Operator compliance with
relevant regulations.
‣
Financial exposure if customers
fail to pay for Charter services
after Air Partner has paid the
operators in advance of flight
take-off, which is custom and
practice in the industry.
‣
During COVID-19, there have
been increased contractual and
counterparty risks as staff have
operated to shorter timescales
and, in some cases, urgent
demand. Operators have also
been under extreme financial
pressures leading to a reduction
in supply.
‣
Failure of aircraft or
operator chartered by
Air Partner, or failure
of other suppliers (e.g.
hauliers).
‣
Loss of customers and
revenues.
‣
Loss of earnings and
cash impact.
‣
Negative reputational
ramifications.
‣
We have an approved list
of aircraft chartered on behalf
of our customers, ensuring that
the best and most appropriate
aircraft is used.
‣
Air Partner’s approved list of
operators is screened, assessed
and benchmarked to ensure
every aircraft meets all our
stringent tests.
‣
The Group constantly monitors
defaults of operators and other
counterparties and incorporates
this information into its credit
risk controls.
‣
It is the Group’s policy that all
counterparties which wish to
trade on credit terms are subject
to a credit verification process
before and during the
business relationship.
‣
Owners: Kevin Macnaughton,
Managing Director, Charter
‣
David McCown, President,
Air Partner Americas
‣
Customers.
‣
Maintaining
brand value.
‣
Growing
organically.
Financial
performance
Financial management and
performance
‣
Foreign exchange risk, interest
rate risk and liquidity risk.
‣
There is a foreign exchange risk
as we buy and sell goods and
services in currencies other
than Sterling, particularly with
regard to the US Dollar and
Euro rates.
‣
There is both a credit and
liquidity risk in paying operators
before a flight occurs or
before payment is received
from the customer.
‣
The financial pressures of
COVID-19 have caused an
increased risk related to
cash and liquidity.
‣
Negative impact on
profitability, cash flow
and financial
statements.
‣
Negative impact on
financial ratios and
credit ratings,
impacting our ability
to raise funds.
‣
Inability to invest in
medium to long-term
drivers of growth.
‣
The Group’s policy on foreign
currency risk is not to enter into
forward contracts until a firm
contract has been signed.
Consideration is given to using
derivatives where appropriate to
hedge our exposure to
fluctuations in foreign exchange
rates. The purpose is to manage
the currency risks arising from the
Group’s operations.
‣
Mitigation of the credit and
liquidity risk by making payments
to operators only once payment
from the customer has been
received, where possible.
‣
Maintaining strong banking
relationships and striving to
keep sufficient headroom in the
facilities to manage the business
risks. The Group currently has
no debt.
‣
Regular monitoring of cash and
cash collections, creating a culture
of cash management across the
organisation.
‣
Where appropriate, the Group has
accessed government support
during the pandemic. For FY21
this amounted to £1.7m. See the
Chief Financial Officer’s review on
pages 33 to 39.
‣
Owner: Joanne Estell, CFO
‣
Customers.
‣
Maintaining
brand value.
‣
Growing
organically.
Change in risk assessment:
No change
Increased
Decreased
Strategic report
47
Air Partner plc | Annual Report 2021
Category
Risk description
Potential impact
Controls/processes to mitigate
Areas of
strategy
impacted
Compliance
and internal
controls
Effective control
environment
‣
Ensuring appropriate and
effective controls and risk
management frameworks
are embedded in our
changing business.
‣
Loss of earnings.
‣
Damage to brand
reputation and
stakeholder trust.
‣
Our risk management framework
is overseen by the Audit and Risk
Committee (ARC). The Head of
Risk and Compliance reports to
the ARC on our risk management.
See page 80 for additional detail.
‣
Following the roll-out of our fully
integrated Charter CRM tool we
have invested in a Finance
Business Improvement Project
to further simplify, standardise
and automate our processes
across the Group. Systemised
controls are currently being
rolled out and processing
times are reducing.
‣
Owners: Mark Briffa, CEO
‣
Joanne Estell, CFO
‣
Maintaining
brand value.
Pages 1 to 60 of this Annual Report constitute the Strategic report. It has been approved and signed on behalf of the
Board on 11 May 2021.
Mark Briffa
Joanne Estell
Chief Executive Officer
Chief Financial Officer
Principal risks and uncertainties continued
Strategic report
48
Air Partner plc | Annual Report 2021
Going concern and viability statement
Going concern
The Group’s business activities,
together with the factors likely
to affect its future development,
performance and position, are set out
in the Strategic report on pages 1
to 60. The financial position of the
Group, its cash flows, liquidity position
and borrowing facilities are described
in the Chief Financial Officer’s review
on pages 33 to 39. In addition, note 24
– Financial Instruments in the financial
statements includes the Group’s
objectives, policies and processes for
managing its capital risk; details of
its financial instruments and hedging
activities; and its exposures to
interest rate risk, credit risk, liquidity
risk and foreign currency risk.
As at 31 January 2021 the Group had
a net cash position of £9.9m (excluding
JetCard cash), compared to a net debt
position of £6.9m at the previous year
end. The increase in cash was driven
by the strong trading during FY21, the
share issue and the steps taken by the
Directors to deal with the economic
impact of COVID-19. At the end of
April 2021 net cash was £12.0m.
In light of COVID-19, during the year
the Group began using normalised
cash (cash in the bank excluding
JetCard, significant customer deposits
and advance payments) as the basis
of its cash flow assessments. As at
31 January 2021 normalised cash
was £8.3m.
In addition to the cash held, the
Group has access to a committed
revolving credit facility of £13.0m
(2020: £13.0m), which the Group
currently does not utilise (2020:
utilised of £11.5m). The facility is due
to expire in February 2023. For
short-term liquidity the Group also
has access to a £1.5m overdraft facility.
As described in the Strategic report,
COVID-19 has increased uncertainty
surrounding the future trading
environment for the Group even as it
appears restrictions are beginning to
be rolled back. The exceptional FY21
results were driven by Group Charter
activity of repatriation flights and
PPE freight logistics during the early
stages of the pandemic, while other
products saw a significant downturn.
The Group is seeing recovery in some
of these products, notably within
Safety & Security, and this has
resulted in the Group recording a
stronger than expected Q1 for FY22.
The Directors have undertaken a
thorough assessment in evaluating
Going Concern. This has been
assessed by reference to cash
forecasts through to July 2022,
which reflect a cautious view of
trading activity across our divisions,
and further sensitivities have then
been applied to reflect a slower
recovery in underlying performance
from the COVID-19 pandemic. We
have also assessed our adherence to
banking covenants where applicable.
In all scenarios tested there are no
reasonably foreseeable downside
scenarios where the Group would
not maintain sufficient liquidity.
Following the year end, the Directors
have continued to carefully monitor
the impact of COVID-19 on the
Group’s products and take steps to
mitigate the potential risks arising.
These include tight control over
credit terms, limiting discretionary
spend and utilising government
support for staff costs in markets that
continue to be highly restricted due
to containment measures in place.
The Directors believe the steps
detailed above and the strong cash
position at the end of April 2021
mean the Group is well placed to
manage its business and meet its
liabilities as they fall due. In reaching
this conclusion, the Directors have
taken into account the risks identified
in the Principal risks and uncertainties
on pages 40 to 48.
The Directors have made appropriate
enquiries and have a reasonable
expectation that the Company and
the Group have adequate resources
to continue in operational existence
for a period of at least 12 months from
the date of this report. Thus, they
continue to adopt the going concern
basis of accounting in preparing the
annual financial statements.
Viability statement
In accordance with the requirements
of the 2018 UK Corporate Governance
Code, the Directors have assessed
the longer-term prospects of the
Group, taking into account its current
position and a range of internal
and external factors, including the
principal risks detailed on pages 40
to 48.
The Directors have determined
that a three-year period is an
appropriate time frame for the
viability assessment. The selected
period is considered to be appropriate
as it represents the limit of acceptable
forecasting accuracy and recognises
the unpredictability of the Charter
business. The Directors have
considered the current financial
position, the prospects of the
Group, the detailed operating plan
for the 2022 financial year and the
strategic plan when making the
viability assessment.
Strategic report
49
Air Partner plc | Annual Report 2021
Viability statement continued
Against the underlying financial model, the Directors have modelled the scenarios laid out below. The revised models
review the impact of the risks on the long-term ability of the Group to continue to operate, in terms of profitability,
cash flow and adherence to banking covenant tests. The Directors have considered the impact of the risks both in
isolation and cumulatively. The Directors are confident that the Group’s diversification in products, services and
geographic base means it is well positioned to react to any changes if any of the risks identified are crystallised.
Based on the assessment detailed above, the Directors have a reasonable expectation the Group will remain viable for
the period being assessed and will continue to operate and meet its liabilities as they fall due. The Directors have no
reason to doubt that the Group will continue in business beyond the period under assessment.
Scenarios
Link to principal risks
Scenario-specific assumptions
Scenario 1 – Market disruption due to
COVID-19 (base case)
The global disruption caused by
COVID-19 has been incorporated into
the base case viability assessment.
The aviation market is not expected to
fully recover until travel restrictions
have been lifted.
Financial management and
performance, including COVID-19
Changing market environment
‣ In line with the Going Concern model,
gross profits for FY22 have been
reduced by up to 20% from the
original budget.
‣ Aviation market begins to return to
historical levels during FY23.
‣ Full market recovery in FY24.
‣ Reduce discretionary spend while
market restrictions prevail.
Scenario 2 – Loss of key staff
The Charter business is reliant on the
relationships our brokers have with
customers. Losing key brokers could
result in loss of customers and
therefore income.
People
‣ Assumed loss of two key brokers.
‣ Gross profit to decline by around 4%
from FY21 offset by a reduction in
remuneration benefits.
Scenario 3 – Impact of flying trends
due to environmental concern
Environmental legislation and
increased public concern over the
environmental impact of flying could
result in a reduction in global flying,
which would limit the market
opportunities for the business.
Changing market environment
Environmental concerns
‣ Reduction in Group Charter gross
profit of 10% from FY23 onwards.
‣ Private Jets gross profit to reduce
by a total of 50% by FY24.
‣ Commission reduces in line with
gross profit.
‣ Private Jets headcount reduced to
an appropriate level to account for
lost business.
Scenario 4 – Technological
innovation
Technology disrupter in Private Jets
delivers a digitalised end to end
solution. Results in loss of market
share and pressure on margins.
Changing market environment
‣ Private Jets gross profit to reduce
by a total of 50% by FY23.
‣ Commission reduces in line with
gross profit.
‣ Private Jets headcount reduced to
an appropriate level to account for
lost business.
Scenario 5 – Non-compliance risk
A failure of controls or due diligence
process could result in one off
expenditure for the business or loss
of income.
Legal, regulatory environment,
ethics and compliance
Effective control environment
‣ £1.0m expense a year for a non-
compliance event.
Scenario 6 – Combination of the above
Combination of the above scenarios.
It is noted that that the model will
likely have overlapping impacts on
the businesses and further mitigating
actions would be taken in this case.
As above
‣ As above.
Going concern and viability statement continued
Strategic report
50
Air Partner plc | Annual Report 2021
CASE STUDY:
Peter Saunders Annual Award for
Extraordinary Customer Service
In 2018 we launched the Peter Saunders Annual Award
for Extraordinary Customer Service to recognise the
lasting impact our late Chairman, Peter Saunders, had
on our Group. With a strong career in retail, Peter
intrinsically knew the importance of customer service
to business performance and reputation and was key
to the introduction of our Customer First programme
that helped us to put customers at the heart
of everything we do.
The winner of the award for 2020 was Jeanne Muzio,
Senior Vice President – Outside Sales team for the US.
Jeanne has been with Air Partner for eight years.
Throughout her time with the Company she
has persistently demonstrated an above-and-beyond
customer service approach to new and existing clients.
Jeanne is an extremely hard-working individual who
thinks creatively about our clients while ensuring we
deliver the extraordinary.
She has led the US Sales teams through an uncertain
and challenging trading period given the effect of the
pandemic and has delivered unparalleled results.
Employing her vast experience in aviation brokerage
and ‘working as one’ Air Partner, Jeanne is consistently
thinking of new ways to broaden the customer
offering by cross-selling the full spectrum of Air
Partner’s products and services.
‘Jeanne’s dedication to
working with her clients
and team is inspirational.
She is a true testament to
delivering our customer-
centric values, which is
what the Peter Saunders
Award is all about.’
Mark Briffa, Chief Executive Officer
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51
Air Partner plc | Annual Report 2021
Sustainability
Introduction
We are committed to:
‣ developing and implementing a
long-term sustainability strategy
for the Group, in line with our
purpose, mission, vision and values;
‣ operating within a responsible and
sustainable framework;
‣ adopting a Group-wide cultural
and policy framework aligned with
the sustainability strategy; and
‣ setting realistic goals and targets
which can be measured and
communicated both internally
and externally.
Sustainability initiatives can be broken
down into Environmental, Social and
Governance (ESG) initiatives.
Environment
This year we have strengthened
our focus on our environment
strategy, building on the initiatives
which had started the previous
year. We appointed Delta-Simons,
environmental consultants, to
consider shareholder, competitor,
industry and our current positions on
environmental issues and potential
areas for consideration for future
policy development.
From the Delta-Simons review,
we identified where we could add
value to the environment protection
effort and make a difference.
We defined four pillars for our
environment strategy, namely:
(a) carbon offseting, (b) charitable
partnerships, (c) reduction of
resource consumption and (d)
transparency in reporting. Initiatives
carried out under each strategic
pillar are detailed later in this report.
Environment strategy governance
An environment working group
(EWG), consisting of representatives
across Air Partner’s functions and
geographies, considers and
proposes to the Group Executive
Team ways to implement each of the
strategic pillars. The EWG’s activities
and progress are regularly reported
to the Group Executive Team, which
has ultimate responsibility for the
implementation of the initiatives.
The Board is also deeply interested
in seeing our environment strategy
being developed and implemented,
and therefore closely oversees
activities, on which it receives
regular reports.
Our environment consultants,
Delta-Simons, guide us in the
implementation of our strategy.
Carbon offsetting
We aim to take greater responsibility
for promoting sustainable flying and
understand the role we can play in
reducing the environmental impact
of flight activities.
In FY20 we formed a partnership
with ClimateCare to provide
customers with the ability to offset
the carbon emissions of charter
flights. The scheme enables
customers to calculate and offset
their carbon emissions dependent on
the type of aircraft being chartered
and the distance flown.
The partnership is continuing,
targeted at supporting projects that
not only cut carbon but also alleviate
poverty and improve lives. The
projects are selected to provide a
combination of the highest quality
emission reductions while also
delivering the most sustainable
development impact. By way of
example, the type of projects
supported by ClimateCare are:
Our commitment to
sustainability
‣ Aqua Clara in Kenya – this project
helps people in rural Kenya gain
access to safe water without
boiling it, by making affordable
household water filters;
‣ Burn Stoves – this project is
revolutionising domestic energy
production in Kenya with its
specially engineered Jikokoa
stove. This market-leading clean
cookstove cuts emissions, reduces
exposure to indoor air pollution
and lowers fuel bills by as much
as $300 per year. It also provides
employment opportunities
in manufacturing, sales and
distribution to more than 400
local people, 60% of whom are
women; and
‣ wind farms – powering the low
carbon transition in India. 75% of
India’s energy needs are currently
met through the burning of fossil
fuel, meaning greenhouse gas
emissions continue to rise. Carbon
finance is supporting the transition
to low carbon energy provision
and creating jobs in predominantly
rural areas.
Our Charter division is focused on
expanding the number of customers
adopting the scheme, whether
customers are chartering private
jets or group charters.
The EWG will also be gathering
information on any environmental
initiatives run by our flight operators
and partners, including any plans
for carbon offsetting and the move
towards Sustainable Aviation Fuel
(SAF). This information will assist
us going forward in refining our
environment strategy in so far as
it relates to our supply chain.
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52
Air Partner plc | Annual Report 2021
CASE STUDY:
Safety & Sustainability
Baines Simmons partnered with
Heart Aerospace, the Research
Institute of Sweden and Electroflight
to provide consultancy and training
support in the development of a
commercially viable all-electric
aircraft – helping to support with
vital approvals and advice on aircraft
certification aspects.
The project will develop the
battery power system of the
Heart Aerospace developed ES-19,
an all-electric aircraft scheduled to
enter commercial service as early
as 2026. With a range of 400km
(217m) and able to operate from
shorter runways (750m), the
ES-19 will be optimised for
short‑haul flights, operating
from smaller airfields.
The battery power pack, being
developed by Electroflight, is a
bespoke, high integrity system
designed to be aerospace certifiable
for flight. As propulsion technology
improves, this range will continue
to extend, with Heart Aerospace
predicting that electric aviation has
the potential to reduce total aviation
carbon dioxide emissions by 43%.
This assistance will be vital as the
ES-19 continues to progress through
the testing and prototype phases.
With a ground-based prototype
currently undergoing testing, a
full-scale prototype is scheduled to
start flight tests in mid-2024. The
aircraft has already secured global
interest, even at such a formative
stage, with Heart Aerospace citing
letters of intent from eight airlines
from across North America, Europe
and Oceania.
‘While the focus of the aviation
industry in recent months has been,
understandably, the impact of the
COVID-19 pandemic on operations
and the market’s immediate future,
in the lead up to this the conversation
centred squarely on the environmental
impact of flight. That conversation
might have been muted recently, but
it has not gone anywhere, and the
lull in aircraft operations during the
pandemic period has led many to
review and reprioritise their options
in terms of thinking, working and
flying greener.’
Ian Holder
MD of Baines Simmons
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Air Partner plc | Annual Report 2021
Sustainability continued
The EWG has identified a number
of initiatives to fulfil this objective,
in particular the following:
‣ a paperless office;
‣ reducing marketing material
other than online;
‣ increasing the number of
e-learning courses;
‣ increasing the use of renewable
energy in offices;
‣ partnering primarily with catering
companies which have an
environmental or sustainability
policy in place; and
‣ in the longer term, transitioning
car usage to hybrid or fully
electric vehicles.
We promote homeworking and
video conferencing to avoid
unnecessary travel. During the
COVID-19 pandemic, employees
have worked from home very
successfully, providing our
customers with uninterrupted
services with the same high quality
and standards as prior to the
pandemic. Taking into account this
success, we will be considering new
ways of working for employees once
the pandemic has abated and
a ‘new normal’ post-pandemic
era has started.
Environment continued
Charitable partnerships
We aim to support environmental
protection causes. We recognise that
there are major environmental issues
to address, such as water scarcity,
plastic pollution and the endangering
of ecosystems and species, on which
we have limited potential to have a
direct impact. Therefore to help
environmental causes, we made it a
pillar of our environmental strategy
to engage with environmental
charitable partners.
We are currently reviewing a range
of charities with which a partnership
initiative would fit with our strategy
and values.
Reduce resource consumption
The vast majority of carbon
emissions resulting from our
business activities are from the
flights provided to our customers.
While that will remain the case
for some time to come, we are
committed to reducing the carbon
footprint resulting from our own
internal operations.
Transparency in reporting
We aim to be transparent to our
stakeholders on the impact of our
activities on the environment and
what we are doing about it.
The Board has taken note of the
Financial Reporting Council’s
recommendations in its letter to
CEOs, CFOs and Audit and Risk
Committee chairs of 12 November
2020, encouraging companies
to meaningfully report on their
environmental policies. The
Board is regularly informed
on the initiatives we take up to
comply and develop our
environment strategy and commits
to disclosing details of the strategy
year on year in our Annual Report
and Accounts. Regular progress
reports are provided at Board
meetings throughout the year, when
there is an opportunity to challenge
the initiatives taken.
Our Charter division acts as
an intermediary between flight
operators and customers and has
no physical assets or operations that
are likely to be directly impacted by
climate change. It is anticipated that
any impact indirectly resulting from
climate change would be more likely
to be seen in the division’s supply
chain, namely flight operators,
resulting from any future laws or
regulations targeted at reducing
climate change. The future of such
laws and regulations and how (and
to what extent) the supply chain
would be impacted is not fully known
today. We will keep abreast
of any changes.
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Air Partner plc | Annual Report 2021
Our Safety & Security division mainly
acts as consultants to airports and
airlines. It is not known today whether
the division’s customer base is likely
to be affected by climate change,
directly or indirectly. The growing
diversification of the division’s client
base is likely to mitigate any negative
impact should it become visible.
The review by the Board of the
financial statements, any climate
related risks and the impact these
will have on the Group’s policies,
strategies and disclosures concluded
that there is no change in:
‣ useful economic lives of assets;
‣ expected amounts and timing of
cash outflows for provisions and
other liabilities;
‣ fair values of assets and liabilities;
and
‣ disclosure of key accounting
estimation uncertainties and
related sensitivities.
The Directors are therefore satisfied
that there is no material impact of
climate change on either individual
assets or cash-generating units in
the financial statements.
As a premium listed company on
the London Stock Exchange, we
intend to fully comply in our FY22
Annual Report and Accounts with
the requirement of the Financial
Conduct Authority to include a
statement consistent with the Task
Force on Climate-Related Financial
Disclosures (TCFD) framework, on
a comply or explain basis.
Greenhouse gas emissions
We have been reporting every year
on our greenhouse gas (GHG)
emissions in the Directors’ report
section of our yearly Annual Report.
This section includes our mandatory
reporting of greenhouse gas emissions
(scope 1 and scope 2) and global
energy use pursuant to the
Companies Act 2006 (Strategic
report and Directors’ report)
Regulations 2013 and the Streamlined
Energy and Carbon Reporting
(SECR) under the Companies
(Directors’ report) and Limited
Liability Partnerships (Energy and
Carbon Report) Regulations 2018.
The methodology used to calculate
our emissions is based on the GHG
Protocol Corporate Standard.
Emissions reported correspond
with the Group’s financial year.
As a whole, we have seen
a decrease in GHG emissions
in 2020, largely driven by the
move to homeworking. We have
seen emission savings from reduced
office occupancy, although emissions
from vehicle usage have increased as
a result of increased operations.
Tonnes of CO2e
Emissions from:
2021
2020
Scope 1 (direct)
210.8
154
Scope 2 (indirect)
86.3
429
Total emissions
297.1
583
Selected intensity
ratio (tCO2e per £m
revenue)
5.95
17
Underlying global energy consumption
used to calculate GHG emissions in
2020 equated to 1,411,409.08 kWh
including 1,069,626.54 kWh (75%)
from vehicle operations. 93% of total
global energy consumption and 87%
of total global GHG emissions result
from operations in the UK.
This assessment has been self-
certified to be carried out in general
accordance to ISO 14064-1:2006
Greenhouse Gases – Part 1:
Specification with guidance at the
organisation level for quantification
and reporting of greenhouse gas
emissions and removals.
Other environmental initiatives
carried out by the Company
Our Wildlife Hazard Management
business, part of our Safety &
Security division, is ISO 14001
certified. ISO 14001 is an excellent
framework to help implement an
environmental management system
(EMS), which helps organisations
reduce their environmental impact
while growing their business.
During the year Baines Simmons
was also at the heart of an initiative
targeted at reducing carbon emissions.
As described in the case study on
page 53, Baines Simmons partnered
with Heart Aerospace, the Research
Institute of Sweden and Electroflight
Ltd to provide consultancy and
training support in the development
of a commercially viable all-electric
aircraft – helping to support with
vital approvals and advice on aircraft
certification aspects.
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Air Partner plc | Annual Report 2021
Sustainability continued
Social
This year our objective has been to:
‣ create an inclusive safe working
environment for our people so
they can reach their full potential;
and
‣ positively impact the economies and
communities in which we operate.
This was achieved through the
performance of the following
strategic pillars:
Employees
Our People strategy is focused on
enabling, engaging and growing our
leaders and managers to allow their
teams to Be Extraordinary.
Over the past year Air Partner has
focused on attracting the best talent,
as well as improving engagement
and retention of our employees. This
was done against the backdrop of
the COVID-19 pandemic, which led
Air Partner to focus strongly on new
ways of working, mental health and
wellbeing, and regular and effective
communication between
management and employees.
The People strategy has been
reviewed and six areas of focus have
been identified to further support
the Group’s strategy and our people:
‣ the future of work;
‣ HR systems;
‣ mental health and wellbeing;
‣ diversity and inclusion;
‣ leadership and development; and
‣ employee reward.
Initiatives to support our People
strategy included:
‣ Employee engagement surveys.
A full engagement survey, ‘Your
Say’, was run in December 2020
which achieved an overall
engagement rating of 74%.
While the survey results were
overall very positive, three areas
were highlighted for further
analysis and action planning in
FY22: communication between
different divisions; personal
development; and reward. Pulse
surveys will take place during
the course of the year to assess
progress on these and other areas
of engagement and a further full
engagement survey will take place
in December 2021.
‣ The Group is committed to a
supportive and inclusive culture
for everyone. We believe it is
in everyone’s best interests to
promote diversity and inclusion,
and to eliminate all forms of
discrimination, harassment,
victimisation and bullying in the
workplace. A revised diversity and
inclusion policy has been launched
which reinforces the value we place
on individuality and our commitment
to a workplace culture that allows
our people to be themselves
without fear of discrimination.
Specifically, in recognition of the
Black Lives Matter campaign, we
developed implicit bias training for
all staff across the Group to raise
awareness and provide support
and guidance to our teams.
The training received excellent
feedback throughout the Group.
‣ The revised annual talent and
succession planning process has
been completed for the second
year. The aim of the plan is to build
a high performance and values-
driven workplace that supports
the long-term growth strategy
of Air Partner. This plan enables
us to take a proactive and robust
approach to talent management
and succession planning. Linked
to this was the launch of a High
Potential Talent programme aimed
at developing the future leaders
of our business. This programme
provides tailored development
through individual coaching
sessions, helping people to
identify strengths and areas of
development, enhancing their
self-awareness and supporting
them to create a career
development plan.
‣ An Employee Advisory Panel,
established in FY20, met throughout
the year, continuing to gather the
views of the workforce and act
as a conduit to the Board,
providing views and advice, and
communicating responses back to
the workforce. All panel meetings
were attended by Amanda Wills,
Non-executive Director, who in
turn regularly reported the panel’s
activities, discussions and
feedback to the Board.
‣ A five-year roadmap for benefits
and rewards has been developed
which focuses on compensation,
variable pay, payroll and HR
systems as well as a career
development framework.
Air Partner is committed to equal
pay and will continue to monitor
and take action where it is needed.
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Air Partner plc | Annual Report 2021
‣ Communication between the
Leadership Teams and staff
includes regular local team
meetings and weekly CEO and
Group Executive Team videos
updating employees on business
performance as well as broader
business matters. Monthly virtual
‘All Hands’ meetings are well
attended where everyone in the
Group is invited to meet with the
Executive Team. The CEO and
Group Executive Team videos are
viewed by a large number of
employees.
‣ A number of different working
groups were set up to discuss
current issues and propose
solutions, including a mental
health and wellbeing group,
a learning hub group, intranet
champions, a future of work group
and a Charity Committee. These
continue to meet on a regular
basis to review progress and
develop solutions.
Health and wellbeing
The Group is committed to
supporting the mental health and
wellbeing of all employees through
increasing awareness, reducing
stigma and encouraging individuals
to take responsibility for their own
mental health and wellbeing. To
deliver against this commitment a
mental health and wellbeing strategy
has been developed and is being
implemented across the Group.
The following activities have been
undertaken as part of the strategy:
‣ A mental health and wellbeing
policy has been developed
providing a framework for
employees and line managers
on how to build and maintain
a workplace environment and
culture that promotes positive
mental health and wellbeing
and prevents discrimination.
Additionally, the policy sets out
the support and resources
available and the procedures to
follow and provides clarity
regarding roles and
responsibilities.
‣ Air Partner is working in
partnership with the Charlie Waller
Memorial Trust. The Trust provides
a range of workplace resources,
tools and support including mental
health and wellbeing webinars,
employee awareness sessions
and training for line managers.
‣ A number of employees have
been trained as Mental Health First
Aiders and we plan to train more
employees in the future.
‣ An employee working group has
been set up with volunteers from
across the business. The role of
the Group members is to act as
champions and ambassadors of
the mental health and wellbeing
strategy and play a significant
role in communicating updates
and initiatives to and from
their colleagues.
In the context of the COVID-19
pandemic and its potential impact on
mental health, the following activities
were carried out during the year:
‣ An update to the Group health
and safety policy.
‣ A Group coronavirus policy
was launched and COVID-19 risk
assessments and protocols were
developed with staff training
provided on these new protocols.
‣ Temporary working from home
policy and home DSE assessments
rolled out to support employees to
ensure safe homeworking.
‣ Our flexible working policy was
refreshed to include guidelines
around agile working in
recognition of the significant
change in the ways of working, to
ensure they are fit for purpose and
support new ways of working that
are and will continue to be around
long after the pandemic is over.
‣ Mental health and wellbeing
webinars were held for employees
covering areas such as mindfulness
and how to improve sleep.
‣ In order to maintain contact
between our employees during the
COVID-19 pandemic, our Charity
Committee organised many social
events which included a Christmas
fun afternoon, weekly quizzes and
weekly online fitness classes.
‣ Our staff and their families were
offered the opportunity to have
an audience with the astronaut
Colonel Tim Peake where he
provided an inspiring insight
into his career, his experience
and how he became an astronaut.
Community
‣ Our volunteering policy was
refreshed, with up to two days’
paid volunteering per year
available to staff. Our Chair,
Ed Warner, and CEO, Mark Briffa,
volunteered at a vaccination
centre in January 2021.
‣ In December 2020, a total
donation of £42k was made
to foodbanks based in our main
office hubs, an amount equal
to £100 per employee to the
following charities: FareShare
Sussex was supported in Gatwick,
UK; Realhelp in Doncaster, UK;
Helping Hands in Cologne,
Germany; and Feeding South
Florida in Fort Lauderdale, USA.
‣ A donation was made to our
mental health charity partner,
the Charlie Waller Memorial Trust.
Governance
The Corporate governance report
on pages 63 to 68 includes details
of our corporate governance
framework, values and culture.
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Air Partner plc | Annual Report 2021
Section 172 statement
Section 172 of the
Companies Act 2006
The Directors are required to act in a manner which complies
with their duties as set out in the UK Companies Act 2006.
This serves as our Section 172 (s.172)
Statement and should be read in
conjunction with the Stakeholder
Engagement section in our
Corporate governance report on
pages 63 to 68. Under Section 172 of
the Companies Act 2006, Directors
have a duty to promote the success
of the Company for the benefit
of the members as a whole and, in
doing so, have regard to the interests
of stakeholders in their decision
making. The Directors, acting fairly
and in good faith, consider what is
most likely to promote the success
of the Company for its members in
the long term.
Consideration of stakeholders’
interests has always been integral
to the work of the Board and in
its decision making. The Board’s
decision-making process includes
deliberating the impact of decisions
on the key stakeholder groups
identified by the Board. For strategic
decisions, the Board is provided with
associated documentation to allow
an informed assessment, for example
an outline of key risks and opportunities
and of the possible impact on
stakeholders and long-term forecasts.
The Board also understands the
importance of ensuring it has an
effective engagement framework to
capture feedback on the business’
impact. Details of the stakeholder
groups’ key concerns and methods
of engagement can be found on
pages 65 to 67. During Board
meetings the Directors consider
the views received from the Group
Executive Team and the Employee
Advisory Panel and review the
progress against strategic priorities
and the changing shape of the
business portfolio. This collaborative
approach by the Board helps it to
promote the long-term success of
the Company.
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Air Partner plc | Annual Report 2021
Communicating effectively during the COVID-19 pandemic
2020 was a truly extraordinary year, presenting challenges to businesses around the world. The Board recognised that
highly effective communication with all stakeholders was essential to alleviate the uncertainties caused by the COVID-19
pandemic, and considered the points in the table below. The Board received regular updates on the challenges and
opportunities we faced and the impact on our stakeholders. In turn, during the early months of the pandemic, the
Board made it a priority to regularly update shareholders on our performance.
The Board also provided oversight and stewardship to the Group Executive Team in driving the implementation
throughout the Group of any initiatives required at short notice, and in communicating these changes effectively with
employees, customers and suppliers.
Stakeholders
Considerations
Shareholders
‣ Understand any shareholders’ concerns on having a stockholding in the aviation sector, which
was so directly impacted by the crisis.
‣ Ensure transparency to shareholders on cost management measures, cash position and
performance via regular RNS communications and shareholder meetings.
Our people
‣ Provide regular updates to employees so they understand the financial performance of the Group
during this uncertain period.
‣ Alleviate any negative impact on the workforce of the challenges of homeworking and on any
related wellbeing issues.
‣ Manage expectations in adopting the furlough scheme in the UK and other government support
schemes in the Group, and the impact of other employee cost-reduction measures.
Customers
‣ Get customer feedback on their needs specific to the COVID-19 pandemic crisis, such as evacuation
needs and other changes in Charter service requirements.
‣ Understand the impact of the COVID-19 pandemic on the existing customers of the Safety &
Security division, the possible timeline and ways of recovery, and the opportunities to sell safety
and security services to existing Charter customers.
Suppliers
‣ Understand the impact of the COVID-19 pandemic on operators and the airline industry.
‣ Cement partnership arrangements with key suppliers to the mutual benefit of both parties.
‣ Assess shortages of supply and understand creditworthiness of operators.
Examples of strategic decisions taken within
the year and stakeholder consideration
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Air Partner plc | Annual Report 2021
Section 172 statement continued
Placing of ordinary shares
On 12 June 2020, we successfully raised new equity by way of a placing of new ordinary shares to institutional investors.
Retail investors were also given an opportunity to participate in the fundraise using the PrimaryBid platform. The total
amount raised was £7.5m. The fundraise strengthened our balance sheet, enabled the repayment of the debt taken at
the time of the Redline acquisition in December 2019, and provided working capital to support organic growth.
Stakeholders
Considerations
Shareholders
‣ Explain the clear rationale for the fundraise and the usage of funds.
‣ Ensure shareholders understand the value proposition of the Group and its strategic objectives.
‣ Allow institutional shareholders, existing and new, a chance to invest in the Company through an
accelerated book build, respecting the tight timeframes.
‣ Announce a retail offer to support the fundraise via PrimaryBid.
Our people
‣ Ensure the workforce’s confidence in our financial stability.
‣ Alleviate any concern of the workforce on our continuing ability and willingness to grow and invest
in its people despite the COVID-19 pandemic.
Customers
‣ Safeguard customers’ confidence in our financial stability.
‣ Increase customers’ confidence in our ability to invest in and diversify our range of products and
services to meet their needs.
Suppliers
‣ Ensure suppliers’ confidence in our financial stability and our ability to pay for suppliers’ services
and products.
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Air Partner plc | Annual Report 2021
year included: employee engagement,
flexible working; mental health; our
environment strategy; technology;
places of work and ways of working,
and Company culture. As an example
of a direct result of these discussions
and proposals put to the Board,
our flexible working policy was
refreshed as a result of the working
arrangements put in place during
the COVID-19 pandemic.
During the COVID-19 pandemic, key
challenges for employees included:
handling childcare, the lack of
face‑to‑face interaction with
customers, suppliers and colleagues,
and uncertainties around the
post‑pandemic new ways of working.
The lack of face‑to‑face interaction
with colleagues was particularly
challenging for new employees. To
address some of these challenges, an
employee assistance programme
was made available with a
confidential Helpline. Employees were
also encouraged to raise concerns
and find solutions regarding working
arrangements, wellbeing and return to
work together with their line manager
or the Company’s People department.
Working groups composed of
employees across the Group were
formed to address new ways of
working. They considered the
changing COVID-19 related risks
and legislative landscape in every
country in which we operate and
communicated assistance and
solutions to employees. Face-to-face
social events were not possible,
meaning our intranet and Microsoft
teams platform were widely used
and were essential for good
communication between colleagues
and other stakeholders. Other
methods of engagement with
employees included weekly videos
from the CEO, online updates,
quarterly ‘All Hands’ meetings,
fortnightly online quizzes, and
competitions. The ‘All Hands’
meetings gave an opportunity for
anonymous questions to be asked
in advance of the meeting so that
the CEO or other members of the
management team could
provide answers.
Ed Warner, Chair
On behalf of the Board, I am
pleased to introduce our Corporate
governance report for the year
ended 31 January 2021. As a Board,
we are committed to delivering
the highest standard of corporate
governance with a view to ensuring
the Company’s long-term success.
We have maintained a strong,
effective and efficient governance
framework, around four strategic
areas of engagement, as follows:
Consideration of
stakeholders’ interests
In line with section 172 of the
Companies Act 2006, the Board
focused on promoting the success of
the Company for the benefit of the
shareholders as a whole. In doing so,
the Board had regard to the interests
of all stakeholders and the Group’s
contribution to wider society.
The Board considers that engaging
with stakeholders and understanding
their views is fundamental to the way
the Company does business. This
was particularly important during the
COVID-19 pandemic, when the impact
on the Company’s stakeholders
needed to be monitored very closely.
Examples of how the Company
engaged with its stakeholders are
detailed on pages 65 to 67.
Regular updates explaining how key
stakeholders’ needs were addressed
were provided to the Board. These
included reports on customer and
supplier feedback, reporting on
participation in industry forums and
events, community activities,
engagement with shareholders
following roadshows and meetings,
and engagement with employees
through the Employee Advisory
Panel. These updates served to
enhance the Board’s understanding
of stakeholder views and aided
decision making.
Engagement with the workforce
The Employee Advisory Panel, which
was formed last year, acted as a
direct conduit to the Board by the
attendance of Amanda Wills, one of
the Non-executive directors, at the
meetings. Items discussed during the
Chair’s introduction to governance
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61
Air Partner plc | Annual Report 2021
Engagement with the workforce
continued
The regular communication between
management and employees has
been particularly praised throughout
the year by employees.
Leadership composition
and evaluation
The Board composition remained
stable throughout the year and
continued to be regularly monitored.
Evaluations were conducted to
assess the individual skillsets of
the Board members against the
requirements of a listed company.
More details on the evaluation
process in the year can be found on
page 74. The Board acknowledged
the usefulness of the evaluation
process and sought to make changes
where potential opportunities for
improvement were highlighted. This
year a skills matrix was developed
against which the Directors assessed
their own skills. This will be a useful
tool to ascertain the skillset required
for any new Non-executive Directors
as well as the need for training.
In the context of a challenging
year due to the COVID-19 pandemic,
the Board appreciated the strong
commitment of the Group Executive
Team, which met virtually every day
to ensure the much-needed
reactivity and flexibility in dealing
with the crisis. The Board worked
particularly closely with the Group
Executive Team, to ensure they
received the support needed in
promptly addressing any threats and
opportunities.
Gender balance and succession
planning for the Board and the Group
Executive Team were regularly
considered, as well as compliance
with the Group’s diversity and
inclusion policy in line with our values.
Further detail on the implementation
of the diversity and inclusion policy
can be found on page 76.
Compliance culture
During the year a risk and compliance
working group was formed. Its
members are senior employees from
various parts of the Group who are
tasked with defining and proposing
to the Group Executive Team a risk
management and compliance
strategy, and associated training
throughout the Group.
Although the group’s activities have
only recently started, the Group will,
in the medium to long term, monitor
and address our compliance culture,
via regular reporting and training
sessions and other means
of communication.
The Board has reviewed any
Speak‑Out concerns raised during
the year in compliance with our
whistleblowing policy, and ensured
remedial plans were in place and
implemented. It has reviewed updated
versions of existing policies, such
as the Modern Slavery Statement,
which are published on the
Company’s website.
With the above four strategic
pillars for governance in place,
I am confident that we have the
best structure to ensure that our
corporate governance is in line
with regulatory requirements
and best practice.
Ed Warner
Chair
11 May 2021
Compliance Statement
This corporate governance statement, together with the Nomination Committee
report on pages 75 and 76, the Audit and Risk Committee report on pages 77
to 80, and the Directors’ remuneration report on pages 81 to 96, provide a
description of how the main principles of the UK Corporate Governance Code 2018
have been applied by the Company during the year ended 31 January 2021.
The Code is published by the Financial Reporting Council and is available on its
website at www.frc.org.uk. It is the Board’s view that, throughout the year ended
31 January 2021, the Company complied with the relevant provisions set out
in the Code. An exception to this was the provision of pension contributions of
12% to the Executive Directors as explained on page 84. This statement complies
with sub-sections 2.1, 2.2(1), 2.3(1), 2.5, 2.7, 2.8A and 2.10 of Rule 7 of the
Disclosure Guidance and Transparency Rules of the Financial Conduct Authority.
The information required to be disclosed by sub-section 2.6 of Rule 7 is shown
on page 98.
We support the principles and provisions set out in the Code and consider it
our duty to manage the Group in accordance with these. We have structured
our Corporate governance report in line with the Code’s principles, and you
will find the relevant compliance statements highlighted in each section.
Details of our corporate governance practices are publicly available on our
website, www.airpartnergroup.com.
More information
Board leadership and Company purpose
– see pages 63 to 68
Division of responsibilities – see pages 73 and 74
Composition, succession and evaluation – see page 74
and the Nomination Committee report on pages 75
and 76
Audit, risk and internal control – see the Audit and
Risk Committee report on pages 77 to 80
Remuneration – see the Directors’ remuneration report
on pages 81 to 96
Chair’s introduction to governance continued
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62
Air Partner plc | Annual Report 2021
Corporate governance report
Board leadership and Company purpose
Role of the Board
The Board is responsible for maintaining sustainable value for our shareholders and promoting our success. It has
oversight of the application of standards of corporate governance that are appropriate to the Group’s size, profile and
circumstances and which emphasise the value of good corporate governance to the sustainable growth of the Group.
The Board confirms that it has completed a robust assessment of the Company’s emerging and principal risks, as
detailed in Principal risks and uncertainties on pages 40 to 48.
Company purpose
The Board establishes the Company’s purpose, values and strategy. In line with the Company’s purpose, the Board sets
the strategic aims of the Group and rigorously reviews trading performance against strategic initiatives and financial
targets set at the beginning of the year. The Board also ensures the necessary resources are in place to achieve the
strategic aims.
Values and culture
The Company is reliant on teams of great people to deliver an extraordinary service. This is supported by a culture committed to customer
centricity. We have five core values, namely ‘Care deeply’, ‘Take responsibility’, ‘Live your passion’, ‘Work as one’ and ‘Be extraordinary’.
These values underpin the Company’s strategy and are clearly communicated within the organisation to provide the framework of our culture
and define the way in which our employees go about their business. These values, together with the Company’s policies, are the thread aligning
the practices and behaviours of the business to the Group’s strategy. The Board recognises the importance of the Company’s remuneration
practices and policies being aligned to the strategy and values. Leading by example, the Board operates in a transparent environment and
encourages debate of issues. This approach is cascaded from the Board to the Group Executive Team to foster a culture of openness and
responsibility, and cascaded further to the Employee Advisory Panel (the Panel), which is chaired by the Chief People Officer and attended by
one of the Non-executive Directors.
Examples of ways in which the Board monitors and assesses culture
Who
How
The Board
‣ As the designated Non-executive Director, Amanda Wills attends the Employee Advisory Panel
(the Panel) meetings, allowing her to assess the Company culture. The Panel is tasked with considering
employee engagement mechanisms and culture. Amanda gives feedback to the Board on these
activities. Additional detail is provided on page 61.
‣ The Board evaluation carried out during the period specifically asked about the culture of the Company
and how this was linked to strategy.
‣ The Head of Risk and Compliance reports to the Board on any compliance issues and areas requiring
improvement. This includes any whistleblowing investigations made in accordance with the
whistleblowing policy.
‣ The Group business ethics policy explains the Company’s approach to ethical and professional
standards and ensures employees know what is expected from them to uphold these standards.
‣ The Chief Executive Officer reports to the Board on the results of any employee engagement surveys
undertaken, allowing the Board to assess any cultural misalignment and discuss corrective actions.
An engagement survey was conducted during the year, the details of which were reported to the Board
which took the time to address the feedback on communication, engagement, reward and recognition.
‣ The implementation of any new policies or significant change to existing policies is reported to the
Board by the Chief Executive Officer to ensure cultural alignment.
Board members
‣ Under normal circumstances, Board members would visit different Group offices both in the UK and
overseas enabling them to interact with employees in their own surroundings and assess culture in a
local context. However, due to the COVID-19 pandemic, this has not been possible, but good communication
both internally and externally with all stakeholders has been maintained via internet communication
channels. The Executives ensure they are accessible to staff at any level by hosting regular ‘All Hands’
meetings and encouraging feedback. The Group Chief Executive rotates round the Group attending
team meetings bi-annually, facilitating a culture of open and honest feedback and transparency.
Audit and Risk
Committee
‣ Attitudes to compliance, risk and internal audit help to give an indication of culture. The Committee
provides an oversight of all business risks including those arising from conduct within the organisation.
Further details on the role of the Audit and Risk Committee in this area can be found on pages 77 to 80.
‣ All agenda items and reports are considered for any conduct and culture implications and their impact
on the vision and values across the Group.
Remuneration
Committee
‣ Overviews of employee pay structures and their alignment with the Company’s purpose, values and
strategy are provided to the Committee allowing the Committee to ensure relevant policies and
practices promote the Group’s values.
Nomination
Committee
‣ The Committee considers the Group’s diversity and inclusion policy, gender balance and succession
planning. This allows the Committee to ensure policies and practices are consistent with values and
provide for an inclusive and diverse culture. Further detail on this is available in the Nomination
Committee report.
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Air Partner plc | Annual Report 2021
Company purpose continued
The Board is satisfied that the policies, practices and behaviours of the Group are aligned with our purpose, values
and strategy and continually monitors this alignment. Outcomes of the Board’s evaluation of culture included:
‣ renewed training programmes for employees to ensure all relevant policies are embedded in our culture;
‣ constant monitoring of any culture related incidents, regularly discussed in the Group Executive Team’s meetings
and reported to the Audit and Risk Committee;
‣ encouragement by Amanda Wills for the Panel to seek understanding and give insight on the Group’s culture; and
‣ assessment of culture added as a regular item for discussion at Board meetings and at the Board’s annual Strategy Day.
During the year, the Board’s governance has contributed to our strategy as follows:
Key strategic activities
Due to the COVID-19 pandemic, we kept the shareholders abreast of our performance on a six-weekly basis. We provided
updates on the work carried out on cost management and cash conservation, identifying the activities of the Group
Charter, Private Jets, Freight and Safety & Security divisions throughout the period. Our various divisions and
locations worked hand-in-hand to deliver complex evacuation and tailored solutions to these extraordinary
circumstances to customers around the world, providing a one-stop-shop for all their needs. Cross-selling opportunities
were actively pursued, which included the products and services offered by the newly acquired Redline.
The wellbeing of our employees was a particular focus during the year, with many employee engagement activities being
held online. Good progress was made to integrate Redline into the Group’s culture, values, policies and procedures. In
addition, a Sharesave scheme was recently launched to all UK based employees.
On 12 June 2020, we carried out a successful share placing which raised gross proceeds of £7.5m to pay down debt
which was used to fund the Redline acquisition (acquired on 12 December 2019) and to make further working capital
available for organic growth opportunities.
At the end of 2020, we acquired some of the trading assets of CHS Engineering Limited, after the business went into
administration. The business now trades under the name Air Partner CHS. Air Partner CHS offers consultancy services
to airports and logistics operations, remote condition monitoring and baggage system testing, thus complementing
our existing service and product offering.
Further details on our purpose, values and strategy and the assessment of the basis on which we generate and
preserve value over the long term can be found in the Strategic report on pages 1 to 60.
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Air Partner plc | Annual Report 2021
Engagement with stakeholders
The Board has regularly engaged with and obtained feedback from its stakeholders, as detailed below:
Our stakeholders and how we engage with them
Stakeholder
Key concerns
Engagement
Outcomes
Shareholders:
Our investors
provide capital
for us to grow
and seek
opportunities for
future investment
and success.
‣ Financial and
operational
performance
‣ Clear and
understandable
strategy
‣ Focus on
sustainable and
responsible growth
‣ Capital allocation
and dividends
‣ Corporate
governance
Annual General Meeting (AGM): Shareholder
participation has been welcomed at previous AGMs.
In line with UK government guidance resulting from
the COVID-19 situation, last year shareholders were not
entitled to attend the AGM in person unless we notified
otherwise. However, despite the pandemic, we were able
to run an AGM and shareholders were invited to submit
questions online ahead of the meeting. Dependent on
governmental guidance, it is anticipated that this year’s
AGM will be held in person. However, should this not
prove possible, shareholders will be asked to submit
their proxy votes and questions prior to the date of the
meeting. For further details see the Notice of Meeting
on pages 170 to 181. AGM voting results are made
public and published on our website.
Ongoing investor engagement: Communication
is conducted primarily through meetings between
the Executive Directors and analysts and significant
shareholders following both the interim and preliminary
announcements of the results of the Group. Corporate
brokers’ reports on investor feedback were shared with
and discussed by the Board.
During the year the Directors conducted online meetings
with shareholders to explain how we were fairing during
the COVID-19 pandemic. Feedback of individual meetings
with investors was regularly shared with and discussed
by the whole Board. Following the successful placing
of ordinary shares with institutional shareholders and
retail investors in June 2020, the Executive Directors
met with new shareholders to give more details on the
running of the Company and listen to the views of
new shareholders.
Regulatory news service: The Board exercises care
to ensure that all information is released in accordance
with applicable legal and regulatory requirements and to
all shareholders at the same time. In last year’s uncertain
times, the Board felt it was even more important to
keep shareholders informed and released updates on a
six-weekly basis of the impact of the COVID-19 pandemic
on our performance in the first half of the year.
Annual Report and Accounts: We strive to provide
a clear, informative and engaging view of the business
in our reporting to shareholders.
Website information: Shareholders and
potential shareholders can access investor related
information in the Investors section of our website,
www.airpartnergroup.com. This site also provides
contact details for any investor related queries.
AGM: The 2020 AGM was necessarily
restricted due to the COVID-19
restrictions. The proposed resolutions
were all passed with votes in favour
ranging from 99.78% to 100%. The
Board answered all questions that were
submitted and responses to these
questions were published on the website
in the shareholder meetings section.
Investor engagement: After the
shareholder meetings took place,
feedback was shared with the whole
of the Board, who identified any actions
to be taken as necessary.
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Air Partner plc | Annual Report 2021
Our stakeholders and how we engage with them
Stakeholder
Key concerns
Engagement
Outcomes
Customers:
Putting our
customers first
and ensuring
a positive
experience
is crucial.
‣ Customer
engagement
and satisfaction
‣ Frictionless
services and
solutions
‣ Protecting
customers’
businesses through
our services
Direct feedback, customer satisfaction surveys and
other engagement: The Board receives regular updates
from the CEO at Board meetings on direct customer
feedback, customer satisfaction survey results for
charters and training, net promoter scores, key customer
meetings and account management activities. Customer
satisfaction and dispute resolution is captured in our
systems as part of our ISO 9001 accreditation.
Customer service: Air Partner is a people business and
the ‘Customer First’ value is promoted by the Board.
The Peter Saunders Award for Extraordinary Customer
Service is granted by the Group Executive Team to one
employee of the Group every year, following nominations
by colleagues of employees who have consistently
engaged with customers to provide them with
extraordinary services.
A new Charter website was launched during the year,
improving customer response time to queries.
We are in the process of developing a JetCard portal
to improve the customer experience further and
facilitate excellent engagement with, and service
to, JetCard customers.
Direct feedback, customer satisfaction
surveys and other engagement:
Customer engagement feedback is taken
into account in Board decisions including
product and people development,
service offerings and the Group’s
geographic spread.
Customer service: Results from customer
satisfaction surveys indicating low
survey scores and underperformance
are followed up by management and
appropriate actions taken. Overall
performance updates are provided to
the Board. Baines Simmons has retained
a gold Feefo standard for five years.
Baines Simmons’ customers continually
provided excellent feedback on the
online training offered during the year
replacing face-to-face training.
Suppliers:
Our supplier
partnerships are
vital to our overall
success, allowing
us to deliver an
extraordinary
experience to our
customers in all
of the markets in
which we operate.
‣ Working in
partnership
to deliver the
best customer
experience
‣ Key supplier
scheme
‣ Effective and
respectful working
partnerships
Key supplier scheme/supplier partnerships: Our Charter
division has hired a Vice President of Supplier Relations in
the US as it increases efforts to strengthen relationships
with operators. This role will be the first resource
dedicated to ensuring quality service delivery to
customers, as well as promoting to operators our
broad range of services, including safety and security
services into the air carrier market.
Relationships with operators continue to be a key focus
point of our Charter division, ensuring delivery of the
highest standards of safety and service are at the heart
of all it does. In an ever-changing environment this is
more important than ever before as we navigate our
way into the future of aviation.
Supplier engagement: Supplier
feedback and engagement informs
the Board’s decisions on supplier
partnerships and enhancements
to service offerings.
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Air Partner plc | Annual Report 2021
Our stakeholders and how we engage with them
Stakeholder
Key concerns
Engagement
Outcomes
Our people:
Our people drive
our business by
creating, selling
and supporting
the delivery of an
extraordinary
service to
customers.
‣ Career
opportunities
and reward
‣ Strategic direction
and success of
the Group
‣ Learning and
development
‣ Internal
communication
and collaboration
‣ Health, safety
and wellbeing
‣ Culture
Employee Advisory Panel: The Panel met regularly to
engage with the workforce. Meetings were attended by
Amanda Wills as designated Non-executive Director.
Further details on the Panel’s activities can be found
on page 63. Members of the Panel were trained on
corporate governance requirements and the role and
duties of the Board, to help them identify how they
could be a bridge between the Board and the workforce.
Employee surveys: Pulse surveys and an employee
engagement ‘Your Say’ survey across the Group were
undertaken with high response rates.
Employee updates: Various engagement methods were
employed with staff including informal town hall events,
‘All Hands’ meetings and the Company’s intranet.
Weekly videos from our CEO and the Group Executive
Team shared business and organisational updates with
employees. Regular communication was also maintained
with employees placed under the UK furlough scheme
or equivalent schemes outside the UK to check
employees’ wellbeing.
Whistleblowing policy: The channels allowing
the workforce to raise concerns in confidence are
clearly publicised to staff and any matters reported
to the Board.
Mental health and wellbeing awareness: During this
difficult year, awareness of mental health and wellbeing
has been a particular focus across the business. With
staff working from home the awareness programme
aimed to help our people look after their own wellbeing,
be self-aware and to look out for and support colleagues
and to provide an environment where people feel able
to ask for help when needed.
The Board receives updates from the
CEO at every Board meeting on matters
relating to our people and engagement
activities. Results of engagement
activities and views have been taken
into account by the Board and its
Committees when considering
remuneration and reward, Group
structure, cultural alignment and
strategic initiatives.
Employee Advisory Panel:
Amanda Wills reports to the Board
on the activities of the Panel, providing
the employees’ perspective on key issues.
Panel members are given a clear
understanding of the Board function
which is passed onto other employees
of the Group. The Panel is tasked with
considering employee engagement
mechanisms to gain employee feedback.
Employee updates: Results and key
messages are deployed to the workforce
using the most suitable methods.
Mental health awareness: Initiatives are
being implemented to educate and ensure
that a wellbeing strategy is embedded
into the business.
Community:
Considering the
impact of our
operations on the
communities and
environments
that the Group
operates in
is imperative
to ensure the
long-term
sustainability of
our offerings.
‣ Local employment
and business
opportunities
‣ Environmental
impact
‣ Support for local
communities
Environment: The action group set up last year
considered our impact on the environment and
proposed an environmental strategy to the Board.
More details on the environment strategy and how
we engaged with stakeholders in this area can be
found on pages 52.
Charitable giving: The Group has a charity committee
made up of volunteer employees across the Group,
responsible for driving charitable initiatives forward
and organising a range of charitable events. Taking
into account the challenges caused by the COVID-19
pandemic and the impact on our local communities,
we strongly focused on helping foodbanks local to our
main offices around the world via donations. More
details on our engagement with communities can be
found on page 57.
Volunteering: All staff are entitled to two volunteering
days annually and are actively encouraged to make use
of these to support projects in the local community.
Environmental, social and governance:
Work is ongoing to implement
environmental initiatives. This is a key
Board agenda item and the Board is
committed to reducing the Group’s
impact on the environment. More details
can be found on pages 52 to 55.
Charitable giving and volunteering:
The Board encourages the fundraising
and volunteering efforts of the Group.
A new charity initiative focusing on
giving back was agreed on for this year.
For every employee of the Group, we
donated £100 per person to four key
charities which provide support to
the local community in our key office
locations. A total of £42,000 was
donated to the four charities, thus
supporting over 100,000 meals to
homeless or vulnerable people. Further
details of the social and charity
initiatives can be found on page 54.
You can find our Section 172 statement, detailing our Directors’ responsibility to stakeholders, on pages 58 to 60.
Corporate governance
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Air Partner plc | Annual Report 2021
UK Corporate Governance Code
A The Board’s role is to provide entrepreneurial leadership to the Group within a framework of prudent and
effective controls which enables risk to be assessed and managed. The Board is also responsible for maintaining
sustainable value for shareholders while contributing to the wider society and having due regard to all
stakeholders in decision making.
B The Board establishes the Company’s purpose, values and strategy and sets the strategic aims of the Group.
The Board acts with integrity, operating in a transparent environment to promote the desired values and culture
of the business.
C The Board ensures the necessary resources are in place to achieve the strategic aims of the Group and measures
performance against objectives. A control framework is in place enabling risk to be assessed and managed.
D The importance of stakeholder engagement is recognised and the Board has developed its engagement
mechanisms to understand stakeholder views on key matters to support its decision-making processes.
E Workforce policies and practices are consistent with the Company’s values and are monitored to be refreshed
as necessary.
Corporate governance report continued
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Air Partner plc | Annual Report 2021
The Board
Ed Warner
Mark Briffa
Joanne Estell
Amanda Wills
Paul Dollman
Richard Jackson*
Responsibilities
The Board carries ultimate responsibility for the effective direction and control of
the Group’s business and is accountable to shareholders for the long-term success
of the Group. This is achieved through:
‣ setting the strategic objectives of the Group;
‣ approving strategic projects and Group and divisional budgets;
‣ ensuring that the Group operates effective risk management; and
‣ reviewing trading performance against financial targets set at the start of
the financial year.
Chair
Responsible for:
‣ leading the Board
as an effective decision
making body;
‣ setting the Board
agenda and regularly
reviewing strategic
aims; and
‣ modelling boardroom
culture and promoting
individual Director
engagement.
Company
Secretary
Responsible for:
‣ advising the Board on
governance matters;
‣ managing the
meeting timetable
in conjunction with
the Chair; and
‣ assisting the Chair
to ensure the Board
receives accurate,
timely and clear
information.
Non-executive
Directors
Responsible for:
‣ considering the
performance of
management against
agreed goals;
‣ providing constructive
challenge and
strategic guidance;
‣ determining appropriate
levels of remuneration
for the Executive
Directors; and
‣ oversight of succession
planning.
Chief Executive
Officer
Responsible for:
‣ providing executive
management and
leading the Group
Executive Team;
‣ setting, communicating
and demonstrating the
values and ethos of the
Group; and
‣ promoting a clear vision
and business plan,
focusing on key
strategic aims.
Senior Independent
Director
Responsible for:
‣ acting as a sounding
board for the Chair,
providing support in
the delivery of
objectives; and
‣ being available to
shareholders who wish
to raise concerns.
Board Committees
Remuneration Committee
Amanda Wills, Chair
Ed Warner
Paul Dollman
Richard Jackson*
Considers and oversees the Group’s
remuneration policy for Directors and
monitors the level and structure of
remuneration for senior management.
Audit and Risk Committee
Paul Dollman, Chair
Amanda Wills
Richard Jackson*
Monitors and reviews the integrity of
financial reporting, has oversight for internal
control and risk management and oversees
the relationship with the external auditors.
Nomination Committee
Ed Warner, Chair
Amanda Wills
Paul Dollman
Richard Jackson*
Monitors and reviews the composition of
the Board as a whole, leads the process
for Director appointments, considers
succession planning and diversity and
supports the Board’s evaluation process.
Directors’ remuneration report:
p81–96
Audit and Risk Committee report:
p77–80
Nomination Committee report:
p75–76
Group Executive Team
Responsible for:
‣ implementing the Group’s strategy as approved by the Board;
‣ recommending capital expenditure and investment budgets for Board approval;
‣ monitoring financial, operational and service performance; and
‣ allocating resources as agreed by the Board.
* Richard Jackson passed away in March 2020.
Governance structure: Board and Committees
Board governance
The Board is ultimately accountable to our shareholders, and the Directors are responsible for ensuring that
management actions are aligned with the interests of other stakeholders. The Board has approved a governance
framework of systems and controls in order to effectively discharge its collective responsibility. This framework
supports our Directors’ compliance and their duty to promote our success under section 172 of the Companies Act
2006 (the ‘Act’). The framework includes the delegation of specific authorities to the Board’s three principal
Committees, the Nomination Committee, the Audit and Risk Committee and the Remuneration Committee.
Corporate governance
69
Air Partner plc | Annual Report 2021
Board of Directors and Company Secretary
Corporate governance
70
Air Partner plc | Annual Report 2021
1. Ed Warner
Chair
C
Appointed: 1 April 2019
Ed has extensive PLC
experience and has chaired
the boards of a range of
prominent organisations.
He knows the broking sector
well and was a Non-executive
Director of Clarkson PLC, the
world’s leading provider of
integrated shipping services,
for over 10 years until
February 2019. He also has
a wealth of financial services
broking experience from years
spent in senior positions at
several investment banks and
financial institutions, including
Dresdner Kleinwort and
Bankers Trust, as well as
CEO positions at Old Mutual
Financial Services and
IFX Group PLC.
Other significant
appointments
‣
Chair, Grant Thornton UK
LLP (stepped down March
2021)
‣
Chair, Blackrock
Commodities Income
Investment Trust PLC
‣
Chair, LMAX Ltd
‣
Director of a suite of
Dublin‑listed investment
funds managed by DCI
‣
Chair, HarbourVest Global
Private Equity
2. Mark Briffa
Chief Executive Officer
Appointed: 1 February 2006
Mark has an extensive
knowledge of air charter
broking and of the aviation
industry worldwide, with
over 30 years’ experience
working within the aviation
sector. He started his career
with Air Partner in 1996 as
a Group Charter Broker and
joined the Board in 2006
as Chief Operating Officer,
becoming Chief Executive
Officer in April 2010. Before
joining Air Partner, Mark held
commercial roles at Air 2000
and All Leisure.
3. Joanne Estell
Chief Financial Officer
Appointed: 10 September 2018
Joanne is a Chartered
Management Accountant with
over 20 years’ experience. She
started her career at Whitbread
Plc and held a number of senior
finance roles at Smiths Group
plc including Finance Director
of Specialised Business at John
Crane and also Head of
Mergers and Acquisitions at
Survitec Ltd. Joanne brings a
wealth of experience gained
from senior finance and M&A
roles at a number of listed and
private companies. Before
joining Air Partner, Joanne held
Chief Financial Officer roles at
Shield Therapeutics plc, the
specialty pharmaceutical
business, and, prior to this, at
Stadium Group plc, a global
manufacturer of technology
lead products.
4. Paul Dollman
Non-executive
Director
C
Appointed: 1 May 2019
Paul Dollman was appointed
as Independent Non-executive
Director of the Company on
1 May 2019 and took up the role
of Chair of the Audit and Risk
Committee on 26 June 2019.
Paul is a Member of the Institute
of Chartered Accountants of
Scotland and has significant
PLC experience and has held
chair and non-executive
director positions at a range of
listed companies. In addition,
he has excellent knowledge of
the aviation industry, having
been Group Finance Director
at John Menzies PLC, the
holding company of Menzies
Aviation, from 2002 to 2013.
He understands the sector’s
operational, strategic and
commercial environment well,
and is credited with nearly
trebling Menzies Aviation in
size during his tenure.
Other significant
appointments
‣
Non-executive Director and
Chair of the Audit Committee,
Wilmington PLC
‣
Non-executive Director,
Scottish Amicable Life
Assurance Society
(resigned March 2021 due to
merger with Prudential plc)
‣
Non-executive Director
and Chair of the Audit
Committee, Etihad Topco
Limited, trading as Verastar
5. Amanda Wills, CBE
Senior Non-executive
Director
C
Appointed: 20 April 2016
Amanda was appointed
Chair of the Remuneration
Committee in June 2017
and as Senior Non-executive
Director following the passing
of Richard Jackson. Amanda
is the Board representative on
the Employee Advisory Panel.
She began her career with
Airtours plc and was Chief
Executive Officer of Virgin
Holidays Travel Group from
2001 to 2014. In 2015 Amanda
was awarded a CBE for
services to the British travel
industry and to charity.
Other significant
appointments
‣
Non-executive Director and
Chair of the Remuneration
and Nomination Committees,
eDreams ODIGEO S.A.,
a global online travel agency
6. Judith Banks
General Counsel and
Company Secretary
Appointed: 6 November 2018
Judith has recently been
appointed as the Group’s
Head of Risk and Compliance.
She qualified as a solicitor in
2001 and has practised law
ever since, starting in private
practice before becoming an
in-house lawyer. Prior to joining
Air Partner in October 2018
Judith held a number of senior
legal counsel positions, including
at Elekta, a Nasdaq-listed
medical devices company, the
industrial group Atlas Copco
and ATR, the regional
aircraft manufacturer.
1
4
2
6
5
3
Key:
Committees:
C Chair
Audit and Risk
Remuneration
Nomination
Independent Director
The Directors and Officers of the Company who were in office during the year and up to the
date of signing the financial statements were:
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Air Partner plc | Annual Report 2021
Group Executive Team
1. Mark Briffa
Chief Executive Officer
2. Joanne Estell
Chief Financial Officer
3. Judith Banks
General Counsel and
Company Secretary
4. Kevin Macnaughton
Managing Director,
Charter
Kevin has a wealth of
experience in the aviation
charter industry, both in the
UK and overseas, having held
a number of senior roles
at NetJets over a period of
13 years. Most recently, he was
Company Director, Head of
European Sales, leading the
planning and execution of
the sales strategy.
5. Paul Mason
Managing Director,
Safety & Security
Paul was at the helm of
Redline from inception
in 2006 to acquisition by
Air Partner in 2019, guiding
Redline from a concept through
to the internationally acclaimed
security training, consultancy,
and quality assurance company
that it has become. With over
25 years of aviation experience,
Paul is now leading the Safety
& Security division of Air
Partner which encompasses
both Redline and Baines
Simmons. The division offers an
unmatched range of products
and services spanning all
aspects of safety and security,
training, consultancy, quality
assurance and innovative
software products to cater
for the needs of tomorrow’s
threats and risks as well as
big data handling, live data
analytics and real-time threat
and risk management.
6. David McCown
President, Air Partner
Americas
David has over 20 years’
experience in the private
aviation industry serving in
various capacities including
as founder of AirCharter.com
(the first online reservation
system for private jets,
acquired by FlightTime in
1998), board member of the
holding company for Wyvern
Aviation Safety and Chair of
the Air Charter Association
of North America. Prior to
aviation, David spent several
years in the banking industry
with Bank of America.
7. Tony Whitty
Executive Vice
President, Remarketing
and ACMI
Tony started his career in
aviation in 1991 and in 1998
became one of the founding
members of Cabot Aviation,
which was acquired by
Air Partner in May 2015 and
is now Air Partner Aviation
Services. Tony leads
Air Partner’s remarketing
business, representing aircraft
owners as exclusive remarketing
agent and also undertaking
acquisition mandates on
behalf of airlines, lessors and
spares companies. Tony also
heads up the ACMI business,
assisting airlines in sourcing
aircraft on ACMI leases.
Tony is a board member of
the European Regions Airline
Association, a committee
member of the Aviation Club
of the UK and a member
of ISTAT.
8. Craig Pattison
Chief People and
Technology Officer
Craig spent 10 years of his
career in general management
and customer service with
Tesco before deciding to
concentrate the next stage of
his career in human resources
both with the retailer and later
in senior HR positions with BP,
Lloyd’s of London and, most
recently, Wood Mackenzie,
where he was Global Executive
Vice President HR and led
the HR function.
In July 2018, Craig joined
Air Partner Group as Interim
Group HR Director before
being appointed permanently
to the role in November 2018.
Craig became Chief People
and Technology Officer on
1 February 2020.
Craig is a Fellow of the
Chartered Institute of
Personnel and Development.
1
6
4
2
7
8
5
3
Key:
Corporate governance
72
Air Partner plc | Annual Report 2021
Division of responsibilities
The Company is governed by a formal
Schedule of Matters Reserved for
the Board (Schedule), which includes
responsibility for the formulation
and development of strategy, values,
major acquisitions or disposals,
significant bank borrowings, Board-
level appointments, the approval of
financial reports and price sensitive
statements and overall business risk
assessment. This Schedule is reviewed
annually by the Board to ensure it
remains appropriate and complete.
The Board discharges some of its
responsibilities through its Board
Committees. Copies of the schedule
of matters reserved for the Board
and the Committees’ terms of
reference, which were reviewed
during the year, can be found on our
website at www.airpartnergroup.com.
Non-executive Directors
The Non-executive Directors consider
the performance of management
against agreed goals and provide
constructive challenge and strategic
guidance to the Executive Directors
during Board discussions.
The Board considers all the
Non‑executive Directors, including
the Chair, to be independent when
assessed by the circumstances
set out in Provision 10 of the
Code. Given their relatively small
shareholdings, the Board does not
believe that these impact on the
independence of Ed Warner,
Amanda Wills or Paul Dollman.
Upon appointment, Directors are
informed of the time commitment
expected from them. A copy of
the terms and conditions of the
appointment of the Non-executive
Directors is available for inspection
at the Company’s registered office
during normal business hours
and during the AGM. Upon their
appointment to the Board, Ed Warner
and Paul Dollman notified the Board
of their commitments to other
organisations as detailed in their
biographies on page 71.
Additional external appointments
are discussed with the Board before
acceptance and the Board reviews
the impact before approving. No such
external appointments were brought
to the Board’s attention this year.
Board and
Committee meetings
The Chairman sets the agenda
and determines the style and tone
of discussions at Board meetings.
At each scheduled Board meeting
the Chief Executive Officer and
the Chief Financial Officer present
separate reports, detailing business
performance and progress against
strategy. These are supplemented by
UK Corporate Governance Code
F The Chair, Ed Warner, is responsible for the leadership and effectiveness
of the Board. Board meetings are open and constructive debate is
encouraged. The Chair, in conjunction with the Company Secretary,
ensures that all Board members receive accurate and timely information.
G At least half of the Board, excluding the Chair, are Non-executive
Directors, whom the Board considers to be independent. This provides
an appropriate combination of Executive and Non-executive Directors
and balance to decision making. There is a clear division of responsibilities
between the leadership of the Board and executive leadership. The division
of these responsibilities has been set out in writing and approved by the
Board and the roles and responsibilities of key Board members are
available online at www.airpartnergroup.com.
H The Non-executive Directors constructively challenge management
and provide strategic steer and guidance. The time commitment
required of Non-executive Directors is communicated to them upon
appointment and any other obligations which may impact this
commitment are disclosed.
I The Board, supported by the Company Secretary, ensures that policies
and processes are in place. Appropriate time is allowed for consideration
of matters and decision making and necessary resources are available
for the Board to carry out its duties effectively.
J When making appointments to the Board, the Board and the Nomination
Committee consider the wide range of skills, knowledge, experience
and independence required to maintain an effective Board. The
Nomination Committee leads the process for Board appointments.
K As a whole the Board has a balance and depth of skills and experience,
together with suitable knowledge of the Group and industry, to enable
successful discharge of respective duties and responsibilities.
L An annual evaluation of the Board’s performance was carried out
during the year and included consideration of the composition of
the Board and its effectiveness.
regular performance updates from
the Chief Executive to the Directors
between meetings. Invitations to
Board meetings are extended to
divisional Directors and functional
heads when appropriate to ensure
the Board is up to date with
management priorities and
challenges. External advisers are
invited to attend as necessary.
All Directors have access to the
advice and services of the Company
Secretary and to independent
professional advice at the Company’s
expense where they judge it
necessary to discharge their
responsibilities as Directors.
Corporate governance
73
Air Partner plc | Annual Report 2021
Board and Committee meetings continued
The table below shows the attendance record of individual Directors against scheduled Board meetings and
Committee meetings that those individuals were eligible or in office to attend. The majority of Board meetings during
the year took place via videoconferencing. The Directors had been due to meet in other locations where Air Partner
has a presence, but these were cancelled due to restrictions arising from COVID-19.
Richard Jackson passed away in March 2020 after a short illness and was unable to attend any of the Board or Committee meetings prior to his passing.
Executive Directors
Non-executive Directors
Mark
Briffa
Joanne
Estell
Ed
Warner
Amanda
Wills
Paul
Dollman
Board
10/10
10/10
10/10
10/10
10/10
Audit and Risk
Committee
4/4
4/4
Remuneration
Committee
4/4
4/4
4/4
Nomination
Committee
1/1
1/1
1/1
Composition of the Board
The composition of the Board is
shown on pages 62 and 69 to 74.
It is comprised of a Non-executive
Chair, two Executive Directors, an
independent Senior Non-executive
Director and an independent
Non-executive Director.
Evaluation
The Board and the Committees
are subject to annual evaluation
to assess their overall effectiveness
and identify any potential learning
opportunities. In addition, a skills
matrix was completed to recognise
individuals’ strengths, areas of
expertise and where we may
have gaps in experience. This was
particularly relevant in determining
Non-executive representation on the
Board, following Richard Jackson’s
passing in March 2020. Having
regard to government restrictions
concerning the pandemic during
the year, the decision was taken
to postpone recruitment of a
replacement Non-executive Director
until face-to-face meetings could
be conducted.
Election and re-election of Directors
Non-executive Directors are appointed
for an initial three-year term, subject
to re-election by shareholders at
each AGM. After the initial term their
appointment may be extended,
subject to mutual agreement. All
Directors are subject to election by
shareholders at the first AGM after
their appointment and to annual
re-election thereafter. On this basis,
all members of the Board will retire
and seek re-election by shareholders
at the 2021 AGM.
Composition, succession and evaluation
Division of responsibilities continued
Corporate governance
74
Air Partner plc | Annual Report 2021
Nomination Committee report
were introduced to assess talent
and succession to Band 3 (senior
leadership). As with external
recruitment, developing the diversity
and inclusiveness of the Group’s
Executive Team is a consideration
in all promotions and appointments.
The processes identified high potential
talent, of which 45% were female.
Board and
Committee evaluation
The performance and effectiveness
of the Board is subject to annual
evaluation. This year the evaluation
process was internally led with
questionnaires drawn up for the
Board and each of the Committees.
The evaluation focused on strategy
and culture, budgeting and financial
performance, risk and control
processes, management diversity
and Board operation. In addition,
the Board’s engagement with all
stakeholders and the assessment of
the impact of the COVID-19 pandemic
on our strategy were key areas of
evaluation. Result summaries for the
Board and each of the Committees
were shared and recommended
actions were openly discussed and
challenged. The key actions were fed
back into the annual Board agenda
and policies and processes were
updated as necessary.
The evaluation process concluded
that the Board maintained focus on
the Group’s strategy and that the
Chair showed effective leadership
and encouraged healthy debate of
issues. It also highlighted that there
were healthy boardroom dynamics
with the right balance being struck
between challenge and mutuality,
with the Non-executive Directors
providing constructive support, and
the Board Committees are being
used effectively and their activities
are being reported regularly to the
Board. Areas of focus for the future
included deeper understanding of
the Group’s international culture and
reiteration of purpose, a greater
awareness of the environmental and
social governance required, the need
for additional Board training and
development, and maintaining focus
on understanding stakeholders.
Ed Warner, Chair of the Nomination
Committee
The principal purpose of the
Nomination Committee is to monitor
the composition of the Board and its
Committees, lead the process for
appointments of new Directors and
Committee members and oversee
planning for our succession needs. The
Committee has responsibility for the
Company’s policy on the promotion of
diversity and inclusion and supports
the Board evaluation process.
The terms of reference for the
Committee have been agreed by
the Board and are available online at
www.airpartnergroup.com. The
Directors who served on the
Nomination Committee during the
period were Ed Warner, Amanda
Wills and Paul Dollman, and their
meeting attendance during the year
is set out on page 74.
Although not Committee members,
the Chief Executive Officer and
Chief Financial Officer are invited
from time to time to attend meetings
of the Committee.
When proposing appointments of
Directors, the Committee considers the
independence, skills, knowledge and
experience that a candidate possesses
compared to the skillsets and
experience of the Board as it currently
stands. Selection of candidates also
takes into consideration the breadth
of knowledge that the Board has
and that it may require to provide
a well-balanced environment which
encourages scrutiny and appropriate
challenge of executive management.
Board appointments
During the year there were no
new directors appointed to the
Board. However, on 21 May 2020,
Amanda Wills was appointed Senior
Non‑executive Director at the Board
meeting following Board notification
of Richard Jackson’s passing.
Succession planning
Succession planning for the
Chief Executive Officer and Chief
Financial Officer was considered
by the Committee during the year.
In addition, more robust processes
Corporate governance
75
Air Partner plc | Annual Report 2021
Board and Committee
evaluation continued
The Board and Committee
questionnaires included an individual
evaluation element both for the
Chair of the Board and Chair of each
of the Committees. Executive
Director performance evaluations
are conducted annually against
pre-set key performance indicators,
on which they receive detailed
feedback in preparation for their
annual reward review.
Overall, the collective view of
the Directors is that the Board
is effective in discharging its
responsibilities. The Board confirms
its belief that all Directors bring
significant value to the business, are
effective in Board decision making
and show the appropriate level of
commitment to their roles.
Diversity and inclusion
The Board is a team made up
of people with a broad range of
backgrounds. The Board believes
that a diversity of experience and
personal strengths is as important
as diversity of gender and social and
ethnic backgrounds. Our policy is
to ensure that the best candidate is
selected to join the Board; this policy
will remain in place going forward.
The Board does not intend to adopt
a quota system with prescriptive,
quantitative targets. Instructions to
any external adviser conducting a
search for appropriate candidates
require it to search for candidates
from as many different backgrounds
as possible.
The Group’s aim is to ensure that
all employees and job applicants are
given equal opportunity and that the
organisation is representative of all
sections of society. In accordance
with our diversity and inclusion
policy, candidates are selected for
employment, promotion, training,
or any other benefit on the basis of
their aptitude and ability regardless
of age, gender, race, religion, sexual
orientation or disability. People with
disabilities are given full consideration
for employment and subsequent
training (including retraining, if
needed, for people who have become
disabled during their employment),
career development and promotion
on the basis of their aptitude and
ability. All employees will be given
help and encouragement to develop
their full potential and utilise their
unique talents. Therefore, the skills
and resources of the Group will be
fully utilised to maximise the efficiency
of the whole workforce. All employees,
no matter whether they are part time,
full time, or temporary, will be treated
fairly and with respect. This policy is
adopted throughout the Group in
relation to all recruitment and to
succession planning, to support a
diverse pipeline. To support this,
implicit unconscious bias training
was rolled out to the Group.
Gender balance
At the date of this report, our Board
consists of two female Directors
and three male Directors. There are
two female executives (25%) on the
Group Executive Team and 9 out
of 37 (24%) of the Group Executive
Team’s direct reports are female.
While specific diversity targets will
not be published, diversity of
experience, expertise and knowledge
as well as gender and ethnicity
will be key considerations in
future appointments.
Strategic initiatives in
the period
In FY21 the flexible working policy
was revised in the UK and a new
Group agile working policy was
introduced. A working group, tasked
with considering future ways of
working, will look in more detail into
how the agile working policy will be
implemented. This group will meet
regularly during FY22 to create a
strategy for the future of work post
the COVID-19 pandemic and will play
a pivotal role in rolling this out.
Providing more flexible and agile
working practices helps us to
promote diversity and inclusion
internally and externally. This
increases our ability to retain
employees while enhancing our
ability to attract talented and
diverse candidates.
Ed Warner
Chair
11 May 2021
Evaluation process
Questionnaire
Completion of tailored
questionnaires for
the Board and
each Committee
Evaluation session
Discussion of results
summary in Board and
Committee meetings
Action
Identification of
actions or areas
to address
Feedback
incorporated
Feedback on policies
and processes and
Board agenda
Nomination Committee report continued
Corporate governance
76
Air Partner plc | Annual Report 2021
Audit and Risk Committee report
Audit and Risk
Committee members
The Committee is made up of
independent Non-executive
Directors. The members of the
Committee during the year were:
‣ Paul Dollman
‣ Amanda Wills
‣ Richard Jackson, who passed away
in March 2020
Although not Committee members,
the Chairman, the external auditors,
the Chief Executive Officer and the
Chief Financial Officer regularly
attend meetings by invitation.
The Committee was therefore
adequately resourced in accordance
with its terms of reference.
The Board is satisfied that the
Committee members have the
appropriate level of expertise to
fulfil the Committee’s obligations
as set out in its terms of reference,
and competency relevant to
aviation services. Where requests
are made all Directors make
themselves available for shareholders
as well as other stakeholders.
Paul Dollman, Chair of the Audit and
Risk Committee
‣ reviewing the status of control
improvement plans, ensuring their
effectiveness and that they are
adequately resourced;
‣ considering changes to accounting
standards and the appropriateness
of accounting policies;
‣ reviewing the actions and
judgements of management in
relation to the interim and annual
financial statements before
submission to the Board;
‣ consideration of the appointment
of the external auditors, their
reports to the Committee and their
independence and effectiveness;
‣ discussing with the external
auditors the nature and scope
of the external audit; and
‣ monitoring the main risks to which
we may be exposed from time to
time, and the risk management
processes and mitigation actions,
including via the implementation
of our policies.
The Committee’s terms of reference
are reviewed on an annual basis and
can be found on our website at
www.airpartnergroup.com/investors.
Fulfilling the role of the
Audit and Risk Committee
In order to fulfil its role, the
Committee has:
‣ held four scheduled meetings in
the year to coincide with key dates
within the financial reporting and
audit cycle;
‣ received presentations and reports
from the Executives and the Head
of Risk and Compliance
throughout the year, to gain an
understanding of the risks facing
the Group; and
‣ met privately with the external
auditors after Committee meetings.
The attendance of Directors at the
meetings of the Committee is set out
on page 74.
I am pleased to present the
Committee’s report for the year
ended 31 January 2021. The
Committee fulfils an important
oversight role on behalf of the Board
by monitoring the Group’s financial
reporting. It also reviews the
effectiveness of both the Group’s
systems of internal control and its
risk management framework.
Role of the Audit and
Risk Committee
The principal role of the Committee
is to assist the Board in fulfilling its
oversight responsibilities in relation
to financial reporting, financial and
internal controls and audit and risk.
The detailed responsibilities of
the Audit and Risk Committee
(ARC) include:
‣ monitoring the Group’s financial
reporting processes;
‣ reviewing financial statements
and announcements relating to
our financial performance;
‣ reviewing and monitoring the
internal controls, internal audit
programme and risk management
processes of the Group;
Corporate governance
77
Air Partner plc | Annual Report 2021
Significant issues addressed during the year and up to signing of the accounts
The Audit and Risk Committee (ARC) has reviewed the following significant financial reporting issues and judgements
made during the year and the preparation of the financial statements with management and the external auditors.
The significant areas of focus considered and the actions taken are set out below. These issues have been discussed
and reviewed by the ARC during the year, notably at the review of the interim results and at the review and agreement
of the audit plan for 2021.
Significant matter
Action taken
Presentation of headline profits and underlying growth
The Committee reviews the policy, presentation and judgements
relating to the separation of statutory profit before tax and underlying
profit before tax for the Group. See note 7 – Exceptional and other
items, in the financial statements.
Consideration is given to any changes in accounting standards and
guidance from the Financial Reporting Council (FRC) in respect to
alternative performance measures.
The Committee considered the presentation of the Group financial
statements, in particular the appropriateness of the classification and
presentation of exceptional and other items and their disclosure.
Approval is required by the Board to record any item as exceptional.
During the year, significant restructuring activities were undertaken
as a result of COVID-19. The Committee agreed that these were
exceptional given the materiality and exceptional circumstances.
Other items that were presented as exceptional items include the
amortisation of acquired intangible assets, which is excluded from
underlying operating profits as a matter of course and in line with
prior years.
Goodwill and other intangibles impairment
The Group carries material balances for goodwill and acquired
intangible assets. The Group’s stated strategy is to grow the business
both organically and via acquisition, therefore it makes material
additions to these balances periodically.
Management performs tests for the impairment of goodwill balances
and acquired intangibles bi-annually.
Impairment tests are based on value-in-use calculations which
require significant judgements in relation to the inputs used,
including forecast growth rates and discount rates.
The Committee reviewed management’s papers and financial models
for testing goodwill and other intangibles for potential impairment
and ensured appropriate sensitivity disclosure. This included
challenging the key assumptions used, principally cash flow
forecasts, growth rates and discount rates.
It was the view of management that there were no indications of
impairment of goodwill or other intangibles across the Group.
Taxation and deferred tax
Tax provisions and amounts recognised as deferred tax assets require
judgement and an estimate in relation to tax risk.
The assets and liabilities recognised in income and deferred tax,
as well as treatment of tax losses in the Group, were assessed by the
Committee taking into account the auditors’ opinion.
The Committee noted the ongoing tax audit in France and the
uncertainty associated with its outcome. See Principal risks and
uncertainties on pages 40 to 48.
Provision for liabilities and charges
The Committee regularly considers the appropriateness of the level
of provisions on material items to the Group and the existence of any
contingent liabilities.
During the year the Committee reviewed the Group’s material
provisions covering such matters as legal provisions, employee
benefits and deferred consideration.
It was determined that the assumptions taken by management were
fair and reasonable. No contingent liabilities were identified.
Audit and Risk Committee report continued
Other financial
reporting matters
Going concern basis for the
financial statements
On behalf of the Board, the Committee
reviewed management’s assessment
of going concern and viability as
presented in the Going concern and
viability statement on pages 49 to 51.
The Committee reviewed
management papers and financial
models to understand liquidity,
borrowing facilities, current trading,
future projections and financial
and operational risk management
before recommending to the Board
that it adopts the going concern
basis of preparation for the 2021
financial statements.
Given the impact of the pandemic
and the increased level of
uncertainty in the aviation industry,
the Committee has supported the
Board more than usual during the
year by closely monitoring our
financial stability, ensuring we are
able to react quickly to the changing
market environment.
Financial and narrative reporting
The Committee is responsible for
reviewing the half yearly results
announcements and the Annual
Report and Accounts before
recommending them to the Board
for approval.
Corporate governance
78
Air Partner plc | Annual Report 2021
The steps taken by the Committee,
or on its behalf, to provide this
advice to the Board included setting
up a committee of senior individuals
within the Group to draft the Annual
Report, with each of these individuals
having responsibility for the production
of certain sections of the document.
In turn, the Committee assessed the
fairness, balance and understandability
of the Annual Report and half yearly
results by considering:
‣ the accuracy, integrity and
consistency of the messages
conveyed in the Annual Report;
‣ the appropriateness of the level of
detail in the narrative reporting;
‣ the key accounting judgements
and the disclosures and estimation
of uncertainties; and
‣ the explanations of the differences
between statutory and underlying
reported results.
The Committee also reviewed
various materials to support the
statements in the Annual Report on
risk management and internal controls,
going concern, and the assessment
of the Group’s long-term viability
– see pages 40 to 48 on Principal
risks and uncertainties and pages 49
to 51 for the Going concern and
viability statement.
Following the review, the Committee
agreed that the Annual Report is
representative of the year and
presents a fair, balanced and
understandable overview, providing
the information necessary for
shareholders to assess our position,
performance, business model and
strategy. The Committee has advised
the Board accordingly.
Other areas of activity by
the Committee
During the year, the Committee has
continued to review the independence
and effectiveness of both the Group’s
systems of internal control and its
risk management framework and
has consequently monitored the
following areas:
External audit
Following their appointment in
October 2018, PricewaterhouseCoopers
LLP (PwC) are now in their third
year with Air Partner. The audit
engagement partner is Andrew
Latham. As agreed in their terms
of engagement, their appointment
is reviewed on an annual basis.
Audit effectiveness is assessed
continually using a number of
measures including: reviewing the
quality and scope of the proposed
audit plan and progress against the
plan; responsiveness to changes in
the businesses; and monitoring the
independence and transparency of
the audit. A formal report received
from PwC in respect of the audit and
matters arising from the Annual
Report was discussed prior to the
Board’s approval of the financial
statements. The Committee monitors
the auditors’ performance, behaviour
and effectiveness during the exercise
of their duties, which informs the
Committee’s decision to recommend
reappointment on an annual basis.
The Independent auditors’ report
can be found on pages 102 to 112.
External auditors’ independence
and non-audit fees
The Committee is aware of the need
to safeguard the objectivity and
independence of the auditors and
the issue is discussed annually by the
Committee and periodically with the
audit engagement partner from
PwC. The Committee is responsible
for the implementation and monitoring
of the Group’s non-audit services
policy, which is designed to maintain
the objectivity and safeguard the
independence of the external auditors.
This policy is reviewed annually
and requires that approval of the
Committee must be obtained before
the external auditors are engaged
to provide any permitted non-audit
services. For permitted non-audit
services that are clearly trivial, the
Committee has pre-approved the
use of the external auditors subject
to set limits detailed in the policy.
To preserve objectivity, independence
and effectiveness of the external
auditors, they do not provide
consulting services unless this
is compliant with this policy. The
policy complies with the European
Commission’s recommendation on
audit independence and with the
Revised Ethical Standard issued by
the FRC in the UK. During the year,
there were no matters that required
consideration under the Group’s
non-audit services policy.
In addition to monitoring compliance
with the policy, the Committee’s review
of the independence of PwC included
examining written confirmation from
PwC that they remain independent
and objective within the context of
applicable professional standards
and considering the performance
of the audit engagement partner.
The Committee is satisfied that
PwC remain independent in fulfilling
their role.
Internal audit matters and
commencement of the Finance
Business Improvement Project
During FY21, the Committee
recommended that we focused
resources on a Finance Business
Improvement Project. This was
to capitalise on the roll-out of the
new Charter CRM and booking tool,
which became fully operational
across the business during the
year. The aim of the project is to
standardise, simplify and automate
our finance business processes
across the Group, leading to an
improved control environment
and increased efficiencies.
During the year, the project plan
was presented to the Audit and Risk
Committee by the Chief Financial
Officer, who is the overall Executive
sponsor, and was subsequently
approved. Regular progress updates
are given at the Audit and Risk
Committee meetings as well as the
main Board. This is a global project
with a fully designated project lead
and key process owners across the
Air Partner Group. The Finance
Business Improvement Project lead
has access to the Chair and members
of the Committee and the authority to
report significant findings or concerns
independently to the Executives.
Corporate governance
79
Air Partner plc | Annual Report 2021
Audit and Risk Committee report continued
Other areas of activity by
the Committee continued
Risk management, internal control
and compliance
During all Committee meetings
that took place during the year, our
Head of Risk and Compliance reported
to the Committee, independently to
the Executives, the main risks which
the Company faced from time to
time, and the corresponding mitigating
actions. This includes the review of
our procedures for detecting fraud
and our systems and controls for
ethical behaviour and the prevention
of bribery, which the Committee
oversees on the Board’s behalf.
The main risks we faced and mitigating
actions were reviewed in April 2021
by the Chair of the Audit and Risk
Committee and found to be
appropriate and effective.
For each risk, the reports to the
Committee gave a short description
of the risk, the name of the Group
Executive Team member responsible
for the risk management and
mitigation, and details of
corresponding management
actions and responsibilities.
Reports to the Committee were
based on a main risk matrix regularly
updated by the Group Executive
Team. The Group Executive Team
regularly reviewed the risk calibration
and the progress of mitigating
actions, understanding that agility
and prompt mitigating responses to
the risks were particularly key in the
context of the COVID-19 crisis.
During the year, to assist the Group
Executive Team in their review and
assessment of risks, a risk and
compliance working group was
formed. The working group is
composed of senior employees
across the Group with visibility of
risks arising in their business area.
They are tasked with defining and
proposing to the Group Executive
Team a risk management and
compliance strategy, prioritising
and implementing mitigation actions.
Activities for this group have
recently started and will be ongoing.
Our Head of Risk and Compliance
also reported to the Committee the
key losses and near misses which
arose across the business and which
are brought to the attention of our
management, describing what
immediate remedial actions
were taken.
Our Head of Risk and Compliance
summarises the main risks facing
the Company to the whole Board
and the details of a compliance
programme being rolled out, targeted
at addressing these risks. This is in
line with the Board’s willingness to
elevate compliance matters to the
whole Board, to ensure that their
importance is recognised throughout
the Company, is visible and dealt with
at the highest level of the organisation.
At the same time, the Board is also
made aware of any concerns raised by
employees under the whistleblowing
policy, whether they relate to any
behaviour or compliance with our
values or policies or any applicable
legislation. As highlighted in the
Corporate governance report on
pages 63 to 68 the Board sees
promoting a compliance culture
within the Company as a key
strategic pillar of its governance.
Audit Committee effectiveness
The Committee has, where
necessary, taken the initiative in
requesting information in order to
provide the appropriate constructive
challenge for it to fulfil its role.
During the course of the year, the
information that the Committee has
received has been timely and clear
and has enabled the Committee to
discharge its duties effectively.
In November 2020, the Audit
Committee conducted a review
of its effectiveness using internal
questionnaires, in parallel to the Board
evaluation. The review concluded that
the Audit Committee continues to
perform effectively and had sufficient,
reliable and timely information from
management to enable it to fulfil
its responsibilities.
Signed on behalf of the Audit and
Risk Committee:
Paul Dollman
Chair of the Audit and Risk Committee
11 May 2021
UK Corporate Governance Code
M The Board has put in place
arrangements for both the
external and internal audit
activities to have a direct and
unfettered line of reporting
into the Audit and Risk
Committee. Representatives
from both internal and
external audit are invited to
attend every Audit and Risk
Committee meeting and also
are able to meet with the Chair
of the Committee as and when
required. The Committee also
meets privately with the
external auditors where any
concerns over the financial
statements or associated
narratives can be discussed
and, if necessary, challenged.
N The Board is responsible for
preparing fair, balanced and
understandable financial
information. The Strategic
report is set out on pages 1 to
60 inclusive and provides
information about the
performance of the Group, the
business model, the strategy
and the risks and uncertainties
relating to the Group’s business.
O The Board sets out the nature
and extent of any significant risks
to the business and maintains
sound risk management and
internal control systems.
Further information on risk
management and internal
control systems is set out in
the Audit and Risk Committee
report on pages 77 to 80.
Corporate governance
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Air Partner plc | Annual Report 2021
Our business is evolving quickly,
and it is essential that we maintain
both competitive and motivational
remuneration. The Committee
recognises the importance of the
retention of the Executive Directors
in achieving the Group’s strategy.
The aims of our remuneration policy
remain valid for our business; however,
we recognise that as we grow the
context in which we operate and the
evolving governance environment for
executive remuneration in UK public
listed companies will be taken into
consideration. We are on the front
foot in addressing these matters.
Key remuneration activities
during the year
Key activities undertaken by the
Committee during the year were:
‣ determining the Executive
Directors’ KPIs for FY21;
‣ reviewing the Executive Directors’
KPIs for FY20;
‣ determining the level of annual
bonus for the Chief Executive
Officer (CEO) and Chief Financial
Officer (CFO) in respect of
performance against targets
in respect of FY20;
‣ postponing the 2020 salary review,
including for the Executive Directors;
‣ introducing a temporary four-day
working week, with associated
salary reduction, across large parts
of the Group (including Executive
and Non-executive Directors, who
took a 20% fee reduction during
this period);
‣ utilising relevant government
support including the UK
Coronavirus Job Retention Scheme
(furlough) and relevant international
support where applicable;
‣ determining the extent to which
the performance measures attached
to the Long Term Incentive Plan
awards were achieved for awards
due to vest in 2020;
‣ setting bonus targets for FY21
following the approval of the
financial budget and including
objectives and KPIs for the CEO
and CFO;
Amanda Wills, Chair of the
Remuneration Committee
Our remuneration philosophy
The Group’s total remuneration
packages are designed to be
competitive to attract, retain and
motivate high quality individuals
throughout the business. Our
packages aim to recruit talented
Executive Directors and senior
Executives capable of effectively
delivering on the Group’s strategy and
driving business outcomes through
their teams, thereby enhancing
long-term shareholder value.
The principles of our remuneration
policy are to:
‣ ensure overall remuneration is
market competitive to attract and
retain the leadership and talent
required to drive the business for
the benefit of all stakeholders;
‣ adopt a simple, transparent
and cost-effective approach to
remuneration which is clear and
understandable for business
leaders, shareholders and the
wider team;
‣ align compensation to
performance and incorporate
a balance of fixed and variable
remuneration elements;
‣ design incentive plans which
reinforce both short and long-term
behaviours, promote long-term
development and support the
strategic plans of the business; and
‣ ensure remuneration packages
motivate and incentivise Executive
Directors, senior Executives and
the broader team to deliver on
stretching performance targets
consistent with our risk
management framework.
The Group employs people in
specialised high capability roles,
from brokers to consultants, aviation
experts to covert testers, and
management across a range of
geographies. The reward structure
for our people is built around a set
of common reward principles on a
framework altered to suit the needs of
each business area. Reward packages
differ, taking into account a number
of factors including seniority, role,
impact on the business, local
practice, custom and legislation.
Directors’ remuneration report
Annual statement by the Chair of the Remuneration Committee
Dear Shareholder
On behalf of the Remuneration
Committee (the Committee), I am
pleased to present the Directors’
remuneration report for the year
ended 31 January 2021.
Our Directors’ remuneration policy was
reviewed in 2019 and was approved
by shareholders at the 2019 AGM with
the support of 97.45% of votes cast.
We were also pleased to receive a
shareholder vote of 99.97% in favour
of our 2020 report and we thank our
shareholders for their support.
National and local lockdowns as a
result of the COVID-19 pandemic have
brought challenges and opportunities
for the Group. We fully acknowledge
the impact that this has had on our
people, customers, suppliers and the
communities where we are based. In
line with our values, our response to
the pandemic has been focused on
looking after the safety, health and
wellbeing of all of our employees and
customers, safeguarding jobs and
protecting our business. Looking
ahead, we are committed to
emerging stronger from the pandemic
by focusing on our employees,
customers, costs and cash. It is
important that we have flexibility in
our remuneration framework so that
we can adapt quickly in a rapidly
changing world. This Directors’
remuneration report focuses on
providing information on remuneration
and decisions taken in respect of
the year ended 31 January 2021.
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81
Air Partner plc | Annual Report 2021
Key remuneration activities
during the year continued
‣ determining the level and
performance conditions to be
attached to Long Term Incentive Plan
awards made to Executive Directors
and Executives during FY21;
‣ undertaking a performance
evaluation of the Committee; and
‣ launching the Air Partner Sharesave
(Save As You Earn) scheme.
Subsequent to the financial year
end, the Committee met to review
the final outcome of the FY21 annual
bonus scheme and the structure and
targets of the annual bonus scheme
and Long Term Incentive Plan (LTIP)
for FY22.
Context to the
Committee decisions
The outlook at the start of the
2020/21 year was positive, supported
by a strong order book in Safety &
Security (c.35% coverage) coupled
with good visibility and new business
in the Charter division. The impact of
the COVID-19 pandemic dominated
the year from its outset and we
responded dynamically to the
challenges which the pandemic
created. In March, we launched Air
Partner Protect to support customers
flying in extraordinary circumstances.
A number of emergency repatriations
were carried out for the UK Foreign
and Commonwealth Office in
challenging circumstances. Alongside
this, we arranged transportation of
emergency medical supplies including
to Wuhan and, as the pandemic
developed, PPE to the UK.
Towards the start of the year, our
share price was severely affected,
falling to a low of 17p in mid-March.
This was in spite of the strong financial
start to the year, generating profits
well ahead of budget and the prior
year. This was driven by business
generated from responding to the
pandemic, which outweighed a
decline in Safety & Security and
European private jet charter.
While the near-term trading was
strong, the outlook was highly
uncertain. We announced decisive
steps to address the challenges and
uncertainty including use of the
government grants and benefits to
significantly reduce the Group’s cost
base and every Director taking a
voluntary 20% pay reduction from
March to June 2020. These measures
were taken to protect the business
and to safeguard jobs. We
determined we would not be in a
position to declare a dividend until
after the crisis had passed and
withdrew financial market guidance.
By May 2020 the share price had
returned to its pre-COVID-19 levels.
In June 2020 we announced a placing
of £7.5m at 75p. This was a prudent
measure to enable debt repayment
on the Redline acquisition and
to allow us to capitalise on new
opportunities. These included
government and commercial work,
opening of new office locations and
attraction of key talent in the air
charter industry.
Overall, during the first half of
the year financial performance
was strong due to exceptional levels
of trading from COVID-19 related
work, including evacuations and PPE
transportation, which offset extremely
difficult trading in the Private Jets
and Safety & Security divisions. This
demonstrated the value of the Group’s
broad spread of aviation activities
offered across multiple markets.
In light of strong trading during the
first half of the year, cost reduction
measures and the placing, the Group
moved from a net debt position of
£6.9m at 31 January 2020 to net cash
of £18m at 31 July 2020. At the time
of the interim results, the Board
considered it appropriate and
prudent to recommence dividend
payments given their importance to
shareholders and an interim dividend
of 0.8p was declared.
We performed exceptionally during
the year with an underlying operating
PBT of £11.6m, compared with £4.2m
in the year to January 2020 and
£5.8m in both of the years ending
January 2019 and January 2018.
Remuneration decisions made
and the implementation of the
remuneration policy
Key decisions directly impacting our
people during the year included the
introduction of a four-day working
week in the UK and utilisation of the
UK government’s Coronavirus Job
Retention Scheme (CJRS) for some
roles. From April to June 2020
approximately one third of UK
employees were on furlough and
some benefits were suspended.
During this period, people were
brought back as work returned and
by August only approximately 4%
of employees were still on full-time
furlough. In July 2020, 27 roles in the
Group were made redundant as part
of a strategic review of the Group’s
shape and outlook and the annual
salary review was suspended.
Individuals who took a 20% pay
reduction, excluding Executive and
Non-executive Directors, will be
repaid the amount of this reduction.
From April to October 2020, the total
amount claimed through the CJRS was
£828k. In November, due to the strong
year-to-date performance we decided
not to utilise the revised scheme.
Government support was also
utilised internationally for areas of
the business that were significantly
impacted by COVID-19.
It is our intention to continue to
review and utilise the government
support available going forward,
where it is appropriate and needed
to protect the business and
safeguard jobs.
In our 2020 Annual Report,
alongside stating that no salary
review would take place in 2020/21,
we stated that the determination of
the KPI and remuneration metrics for
bonus and LTIP would be postponed
and would be reviewed at the half year
point. The normal maximum bonus
opportunities for our CEO and CFO are
100% and 70% of salary, respectively.
Directors’ remuneration report continued
Annual statement by the Chair of the Remuneration Committee continued
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Air Partner plc | Annual Report 2021
In July, we reviewed the annual bonus
position. At the start of the year and
prior to the onset of the COVID-19
pandemic, we had envisaged a stretch
underlying PBT target, covering 70%
of annual bonus, at £7.15m. In light of
strong year‑to-date performance to
July we introduced an extraordinary
stretch PBT target of £11.7m, which,
if achieved at maximum, would result
in a proportional uplift of the bonus
by 50% for the CEO and 43% for the
CFO. As such, the total maximum
bonus opportunity of our CEO and
CFO would remain within the policy
maximum to be used in exceptional
circumstances of 150% of salary and
100% of salary, respectively.
Our scores for the CEO and CFO
against the KPI element of their bonus
(which covers 30% of annual bonus)
were 75% and 75%, respectively.
As such, applying the extraordinary
stretch enhancement to the PBT
portion of annual bonus and the
KPI scoring would have resulted
in annual bonus payments of 132%
of salary for our CEO and 89% of
salary for our CFO.
The performance of our CEO and CFO
has been outstanding in exceptionally
demanding circumstances. It is in
this context that the Committee has
determined that high level bonuses
are well earned, justified and, in fact,
necessary to retain and motivate our
Executives. In making this decision the
Committee considered our use of
some government support, the
experience of shareholders and the
wider employee experience. The
Committee consulted with some of
its largest shareholders, holding 37%
of the issued shares, on this matter
in early 2021.
In light of the overall circumstances,
the Committee has determined to
exercise discretion to reduce the
amounts payable reflecting
extraordinary stretch performance to
the normal maximum levels of 100%
of salary for the CEO and 70% of
salary for the CFO.
In August 2020, an award of 503,919
ordinary shares representing 150% of
salary was granted to the CEO and
223,964 ordinary shares representing
100% of salary was granted to the CFO
pursuant to our 2012 LTIP scheme,
subject to the performance conditions
detailed later in this report. These
awards were not scaled back as
the share price had returned to its
pre-COVID-19 levels at the time of
grant. In accordance with the
remuneration policy, the LTIP awards
made to the Executive Directors
were subject to enhanced malus and
clawback provisions and an additional
two‑year holding period. These
awards are eligible for dividend
equivalents to be paid in shares at
the time that the award vests.
The LTIP award granted to the CEO
in June 2017 under the LTIP 2012
scheme was due to vest in July 2020.
This award was subject to EPS
and TSR performance conditions
covering the period 1 February 2017
to 31 January 2020. The performance
conditions of this award were not
met and the award did not vest.
Focus for FY22
The Committee will continue to
monitor the effects of the COVID-19
pandemic on our business and our
people and will continue to take
proactive action. The use of
available government support will
be reviewed and utilised where it is
needed to protect the business and
safeguard jobs.
As the focus on executive
pay continues, the Committee
remains mindful of the developing
remuneration landscape. The
Committee will continue to consider
the wider pay and employment
conditions elsewhere in the Group
and ensure that pay structures
from Executive Directors to senior
Executives are aligned with the
wider workforce as appropriate.
The Committee is satisfied that the
remuneration policy continues to
work effectively and supports the
delivery of our strategy. We do not
intend to make any material changes
to the remuneration policy in FY22.
The Committee will undertake
a focused review of our Directors’
remuneration policy ahead of the
policy vote at the 2022 AGM. As part
of the review the Committee will
seek feedback from shareholders
and engage with the Employee
Advisory Panel to explain how
executive remuneration aligns
with our wider pay policy.
I hope that you find this report helpful
and informative and I look forward to
receiving further feedback from our
investors on the information presented.
On behalf of the Committee, I look
forward to receiving your support
at the AGM.
Amanda Wills
Chair of the Remuneration Committee
11 May 2021
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Air Partner plc | Annual Report 2021
The Directors’ remuneration policy was approved by shareholders at the 2019 AGM on 26 June 2019 and is effective
until the 2022 AGM.
The Committee works hard to ensure that the remuneration policy and practices are clear and transparent and that
the level of remuneration received is reflective of the overall business performance. The Committee believes that the
structure of Executive Directors’ and senior Executives’ reward should be aligned to the Group’s strategy, purpose and
values and as such a greater proportion of the package for senior leadership roles is therefore performance based pay
through an annual bonus and LTIP. This ensures the remuneration of the Executive Directors and the senior Executives
is aligned with the performance of the Company and therefore the interests of shareholders. The approved 2019
Directors’ remuneration policy will be implemented in accordance with the policy table outlined below.
The table below summarises the main elements and performance metrics of the reward package for Executive Directors.
Purpose and link to
Remuneration policy
Key features and operation
Maximum potential value
Performance metrics
Provision for clawback or
withholding of payment
Base salary
Supports the recruitment
and retention of Executive
Directors of the calibre
required to fulfil the role
without paying more than
is necessary.
Rewards Executives for
the performance of their
role. Reflects the skills,
experience and role within
the Group.
Paid in cash.
Normally reviewed annually
to take effect on 1 August but
exceptionally may take place
at other times of the year.
In determining base salaries,
the Committee considers:
‣ pay levels at companies
of a similar size and
complexity;
‣ external market conditions;
‣ pay and conditions
elsewhere in the Group;
and
‣ personal performance.
The Committee’s policy is
to set base salary at an
appropriate level taking
into account the factors
outlined in this table;
there is no maximum value.
The Committee considers
individual salaries at the
appropriate Committee
meeting each year.
N/A
None
Pension
Provides funds to allow
Executive Directors to
save for retirement.
Provides a market
competitive retirement
benefit.
Incentivises and
encourages retention.
In determining pension
arrangements, the
Committee takes into
account relevant
market practice.
The scheme is defined
contribution.
A salary sacrifice scheme
is in operation for
Executive Directors.
Executive Directors may
elect, with the Committee’s
consent, to receive some
or all of the Company’s
pension contribution as
a cash alternative.
Bonuses are
non‑pensionable.
Both the CEO and CFO
receive a Company
contribution of 12.0%
of basic salary.
Pension contributions for
new Executive Directors
will be in line with other
scheme participants.
N/A
None
Benefits in kind
Provides a market
competitive level of
benefits to Executive
Directors.
Executive Directors can
receive life assurance,
health insurance, car
allowance, income
protection, critical illness
cover and sports club or
gym membership.
There is no maximum
value.
N/A
None
Directors’ remuneration report continued
Remuneration policy report
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Air Partner plc | Annual Report 2021
Purpose and link to
Remuneration policy
Key features and operation
Maximum potential value
Performance metrics
Provision for clawback or
withholding of payment
Relocation/expatriate assistance
Provides assistance to
Executive Directors who
are required to work away
from their home location
to enable us to recruit the
best person for the role.
Assistance will include (but
is not limited to) facilitating
or meeting the costs of
obtaining visas or work
permits for Executive
Directors and their
immediate family, removal
and other relocation costs,
house purchase or rental
costs, limited amount of
travel costs and tax
equalisation arrangements.
There are a number
of variables affecting
the amount that may
be payable, but the
Remuneration Committee
would pay no more than
it judged reasonably
necessary. The maximum
amount payable shall not
exceed £50,000 per
individual in any
financial year.
N/A
None
Annual bonus
Rewards and incentivises
the achievement of annual
financial objectives which
are aligned with key
strategic goals and
supports the enhancement
of shareholder value.
Paid in cash following
announcement of financial
year results.
Bonuses are
non‑pensionable.
May be paid in shares at
the Committee’s discretion.
Where the bonus is paid in
shares these must be held
for a period of two years.
The Committee has
overall discretion to
adjust the extent to which
bonuses are paid (in line
with the 2018 UK Corporate
Governance Code).
Maximum opportunity
to achieve:
‣ CEO: 150% of base salary;
and
‣ CFO: 100% of base salary.
Bonus accrues from
threshold levels of
performance. At threshold
only the KPI element of
the bonus is payable.
Maximum opportunity
to be used in exceptional
circumstances.
Both CEO and CFO bonus
payment is based on:
‣ personal objectives:
30% based on
performance against
key performance
indicators (KPIs)
defined at the
beginning of each
financial year; and
‣ Company performance:
70% based on financial
metrics.
Bonus is usually not paid to
a good leaver should they
leave before the payment
date of said bonus.
Arrangements are in place
under which amounts
paid out in bonus can
be clawed back from
Executive Directors in
defined circumstances.
Long Term Incentive Plan (LTIP)
Incentivises Executives
to achieve our long‑term
strategy and
create sustainable
shareholder value.
Enhances shareholder value
by motivating growth in
earnings and maintenance
of an efficient and
sustainable level of return
on capital.
Aligns with shareholder
interests through the
delivery of shares.
Awards vest after three
years based on Group
financial targets.
Awards are in the form
of nil-cost options and
must be exercised within
four years of vesting.
25% of awards vest at
threshold levels of
performance. For
performance above
threshold, awards vest
on a straight-line basis up
to a maximum of 100%.
The Committee has
overall discretion to adjust
the extent to which awards
will vest (in line with the
2018 UK Corporate
Governance Code).
Awards granted from 2019
which vest after the end of
the three-year performance
period will be subject to an
additional two-year holding
period. During this period
the shares cannot be sold
(other than as required for
tax purposes). The holding
period is also applied
post-employment for
Executive Directors who leave
after the performance period.
Maximum plan award
of 150% of base salary
to be used in exceptional
circumstances.
Usual award levels will be:
‣ CEO: 100%–150% of
base salary; and
‣ CFO: 75%–100% of
base salary.
Dividend equivalent
amounts may be added
to performance share
awards in shares at the
point of vesting.
The Committee will review
the appropriateness of
performance measures
on an annual basis and
set challenging targets
consistent with the
business strategy.
Two thirds of the award is
based on an earnings per
share (EPS) target and
the remaining third on a
total shareholder return
(TSR) target.
The Committee has
the ability to select
appropriate performance
condition criteria, mix
and targets each year.
As per the rules of the
scheme, awards will lapse
if the Executive leaves
before the end of the
performance period.
The Remuneration
Committee has discretion
in certain circumstances
(for example death, serious
illness or redundancy) to
permit an award to vest
before the end of the
performance period.
The LTIP scheme
rules contain malus and
clawback provisions under
which amounts paid out
can be recovered back
from Executive Directors
in defined circumstances.
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Purpose and link to
Remuneration policy
Key features and operation
Maximum potential value
Performance metrics
Provision for clawback or
withholding of payment
All Employee Share Plan
Encourages all employees
to make a long-term
investment in the
Company’s shares in
a tax efficient way.
The Executive Directors
may participate in the
Company’s Sharesave
(Save As You Earn)
scheme, on the
same terms as other
eligible employees.
The maximum participation
level will be aligned to
HMRC limits.
N/A
None
Shareholding guideline
Incentivises Executives
to achieve our long‑term
strategy and
create sustainable
shareholder value.
Aligns with shareholder
interests.
Target value to be
achieved over five years:
‣ CEO: 100% of salary; and
‣ CFO: 50% of salary.
Until the shareholding
guideline has been
achieved, Executives must
retain at least half of
vested LTIP awards
beyond those needing
to be sold to pay tax.
N/A
N/A
N/A
Directors’ remuneration report continued
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Air Partner plc | Annual Report 2021
Discretion
Annual bonus documentation and the LTIP rules contain provisions to give the Committee the ability to apply
discretion to adjust the formulaic outcomes in line with the 2018 Code but always within plan limits as determined by
the new policy. Any use of discretion would clearly be explained in the Directors’ remuneration report.
Remuneration policy for other employees
The policy described above applies specifically to the Executive Directors. In practice, the Committee also has
responsibility for setting the policy for, and determining the remuneration of, the senior Executives.
In all cases, the Committee is mindful of the remuneration policy which applies to the broader workforce and seeks to
ensure that the underlying principles which form the basis for decisions on Executive Directors’ and senior Executives’
pay are consistent with those on which pay decisions for the rest of the workforce are taken.
Illustration of the remuneration policy
Three scenarios of Executive Directors’ remuneration based on differing performance: minimum (fixed pay, pension
and benefits), on target (fixed remuneration plus annual performance related pay, paying out at target levels, and LTIP
at 100% for CEO and 75% for CFO) and maximum (fixed remuneration plus maximum variable pay that may be awarded).
A scenario is also shown which provides an indication of the maximum remuneration receivable, assuming share price
appreciation of 50% on the LTIP.
A significant proportion of the potential remuneration of the Executive Directors is variable and is therefore
performance related. It is also subject to deferral, additional holding periods, malus and clawback.
Minimum
Minimum
357
238
872
493
638
738
Target
Target
Maximum
Maximum
100%
100%
41%
28%
24%
25%
34%
36%
30.5%
30.5%
36%
48%
37%
32%
21%
31%
31.5%
27%
27%
14%
31.5%
Maximum with share
price growth (50%)
Maximum with share
price growth (50%)
Chief Executive Officer (£’000)
Chief Financial Officer (£’000)
Fixed pay
Cash bonus
LTIP
Share price growth
1,257
1,482
15%
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Remuneration policy report continued
Remuneration policy table – Non-executive Directors’ fees
The following table sets out a summary of our remuneration policy for Non-executive Directors:
Remuneration element
Purpose and link to remuneration policy
Key features and operation
Fees
Fees for Non-executive Directors
are set at an appropriate level to
recruit and retain Directors of a
sufficient calibre without paying
more than is necessary to do so.
Fees are set taking into account
the following factors: the time
commitment required to fulfil the
role, typical practice at other
companies of a similar size, and
salary levels of employees
throughout the Group.
The Non-executive Directors fee policy is:
‣ to pay a basic fee for membership of the Board; and
‣ to pay additional fees for fulfilling the role of Chair of
the Board and/or Chair of a Committee and for the
role of Senior Independent Director, taking into
account the additional responsibilities and time
commitment of these roles.
Fees are reviewed at appropriate intervals (normally
once every year) by the Board. Our current maximum
fees are as follows:
‣ basic fee – £35,000;
‣ additional fee for Board Chair – £45,000;
‣ additional fee for Committee Chair – £5,000; and
‣ additional fee for Senior Independent Director – £5,000.
Non-executive Directors’ letters of appointment
The Non-executive Directors do not have service contracts but have entered into letters of appointment with
the Company covering matters such as duties, time commitment, fees and other business interests. The letters
of appointment do not include any provisions for the payment of pre-determined compensation upon termination
of appointment and notice may be served by either party.
The Non-executive Directors are appointed for an initial three-year period which may be renewed once by mutual
consent. In exceptional circumstances, a further extension may be agreed, but no Non-executive Director, with the
exception of the Chair, may serve for a period of more than nine years from their date of initial appointment.
Details of the letters of appointment of the Non-executive Directors at 31 January 2021 are set out below:
Non-executive Director
Date of appointment
or reappointment
Term
Unexpired term at
31 January 2021
Notice period
Ed Warner
1 April 2019
3 years
1 years, 2 months
3 months
Paul Dollman
1 May 2019
3 years
1 years, 3 months
3 months
Richard Jackson1
7 September 2019
3 years
Amanda Wills
20 April 2019
3 years
1 years, 2 months
3 months
1 Richard Jackson passed away on 26 March 2020.
Remuneration Committee structure
The Committee is constituted as a formal sub-committee of the Board with its own terms of reference. Its primary role
is to review and set the remuneration policy for the Executive Directors, within the context of salaries and benefits
paid across the Group as a whole, and make discretionary performance related awards to the Executive Directors.
The full Board agrees the remuneration of the Chair and Non-executive Directors on the principle that no individual
should be able to determine their own remuneration.
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Air Partner plc | Annual Report 2021
Remuneration Committee membership
The members of the Committee during the year until the date of this report were:
Amanda Wills (Chair)
Paul Dollman
Richard Jackson (Richard passed away on 26 March 2020)
Ed Warner
In addition, the Chief Executive Officer, Chief Financial Officer and Chief People and Technology Officer are invited
from time to time to attend meetings of the Committee. No individuals are involved in decisions relating to their own
remuneration. The Committee met formally four times during the year. The terms of reference for the Committee can
be viewed on our website at www.airpartnergroup.com/investors.
External advisers
The Committee received advice during the period under review from h2glenfern. h2glenfern was appointed to provide advice
to the Committee following a tender process in 2015. h2glenfern voluntarily operates in accordance with the Code of Conduct
of the Remuneration Consultants Group in relation to executive remuneration consulting in the United Kingdom. h2glenfern
does not provide other services to the Group and has no other connection with the Company or individual Directors. The
Committee has therefore satisfied itself that advice provided by h2glenfern was objective and independent. Fees of £13,500
on a time spent basis were payable to h2glenfern during the year. The advice and recommendations of the external advisers
are used as a guide, but do not serve as a substitute for thorough consideration of the issues by each Committee member.
Advisers attend Committee meetings occasionally, as and when required by the Committee.
The Committee may also obtain, at the Company’s expense, any necessary legal or other professional advice.
Directors’ remuneration for the year ended 31 January 2021 (audited)
The following table provides details of the Directors’ remuneration for the year ended 31 January 2021, together with
their remuneration for the year ended 31 January 2020:
Total
Total
Taxable
fixed
variable
Salary
benefits
Bonus
LTIP3
Pension
remuneration
remuneration
Total
2021
2020
2021
2020
2021
2020
2021
2020
2021
2020
2021
2020
2021
2020
2021
2020
£’000 £’000
£’000 £’000
£’000 £’000
£’000 £’000
£’000 £’000
£’000 £’000
£’000 £’000
£’000 £’000
Executive
Directors
Mark
Briffa
288
283
21
20
300
—
—
335
35
36
344
339
300
335
644
674
Joanne
Estell1
192
196
14
13
140
—
—
—
23
22
229
231
140
—
369
231
Non-
executive
Directors
Ed Warner
81
71
—
—
—
—
—
—
—
—
81
71
—
—
81
71
Paul
Dollman
35
30
—
—
—
—
—
—
—
—
35
30
—
—
35
30
Richard
Jackson2
7
43
—
—
—
—
—
—
—
—
7
43
—
—
7
43
Amanda
Wills
38
39
—
—
—
—
—
—
—
—
38
39
—
—
38
39
Total
641
662
35
33
440
—
—
335
58
58
734
753
440
335
1,174 1,088
1 Due to an administrative error, Joanne Estell was overpaid £3,479 in pension contributions in FY20. The full amount of £3,479 was paid back
in FY21.
2 Richard Jackson passed away on 26 March 2020.
3 No value was attributable to share price appreciation.
As a response to the COVID-19 pandemic, we did not hold an annual salary review during FY21.
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Air Partner plc | Annual Report 2021
Pension
The existing Executive Directors’ pension arrangements are ahead of the rate which is given to the majority of our
workforce. The pension contribution for the CEO and CFO is 12% of salary. The Committee will review the pension
arrangements of Executive Directors when it considers its remuneration policy to be put to shareholders at
its 2022 AGM.
None of the Executive Directors have a prospective right to a defined benefits pension with the Company.
Benefits in kind (audited)
Executive Directors receive a benefits package including a car allowance, health insurance, life assurance, critical
illness cover and home telephone and internet facility.
Annual bonus (audited)
The bonus payment for the Executive Directors is based on the following weighting: 70% relating to the Group’s
underlying profit before tax result above threshold and 30% attributable to achievement against personal objectives.
For reference, the underlying profit before tax threshold for the financial year ended 31 January 2021 was £11.6m.
In light of strong year-to-date performance to July we introduced an extraordinary stretch PBT target of £11.7m, which,
if achieved at maximum, would result in a proportional uplift of the bonus by 50% for the CEO and 43% for the CFO.
Applying the extraordinary stretch enhancement to the PBT portion of annual bonus and the KPI scoring would have
resulted in annual bonus payments of 132% of salary for our CEO and 89% of salary for our CFO.
In light of the overall circumstances, the Committee has determined to exercise discretion to reduce the amounts
payable reflecting extraordinary stretch performance to the normal maximum levels of 100% of salary for the CEO and
70% of salary for the CFO.
Underlying profit before tax (70%)
Actual
KPI (30%)
% payable
Threshold
£m
Target
£m
Stretch
£m
Extraordinary
stretch
£m
Mark Briffa
5.85
6.50
7.15
11.7
11.6 See table below
100%
Joanne Estell
5.85
6.50
7.15
11.7
11.6 See table below
70%
Profit is before income tax, exceptional and other items.
Below is a summary of the personal objectives and achievements for the CEO:
Strategic pillar
Weighting
Measures
Achievement
Profitable growth
70%
Deliver a budgeted underlying PBT of at
least £6.5m
Achieved
Transformational
success
30%
Recommence the integration plan for
Safety & Security
All relevant key milestones in integration
plan achieved
Embed the CRM and booking tool into the
Charter business
CRM rolled out and fully embedded
Develop and launch an ESG policy for the
Group along with a carbon neutral
programme for customers
ESG policy/framework in place. Carbon
offset scheme soft launch
Directors’ remuneration report continued
Annual report on remuneration
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Annual bonus (audited) continued
Below is a summary of the personal objectives and achievements for the CFO:
Strategic pillar
Weighting
Measures
Achievement
Deliver a budgeted underlying PBT of at
least £6.5m
Achieved
Achieve cash conversion – target 85%.
Measured by cash generated from
operations less investment activities
(excluding acquisitions) divided by
operating profit
Achieved
Reduce the Group’s debt from £11.5m
to at least £5m
Achieved
Broadening
our offering
10%
Oversee the finance integration plan for
Safety & Security
Year 1 finance integration
milestones achieved
People
10%
Deliver on the FY21 objectives as set out
in the finance strategy
Key roles have been recruited. Finance
Business Improvement project in progress
Growing
organically:
strengthening our
core business
10%
Demonstrate prior year investments in
new office openings and people are
paying back
Prior year investments are paying back
in c.18 months and there is a clear sight
to profitability
Provide insightful analysis to support the
business in the pursuit of profitable
organic growth initiatives
Achieved
Payments to former Directors (audited)
There were no payments to former Directors made in the year.
Payments for loss of office (audited)
There were no payments for loss of office to Directors or former Directors made in the year.
Long Term Incentive Plan (LTIP) (audited)
Details of unvested share awards outstanding at the financial year end are shown in the following tables:
Name
Number of options
Size
(% salary)
Face
value
Closing
share
price on
the day
before
grant
Exercise
price
Earliest date
of exercise
Expiry
date
Date of
grant
31 January
2020
Granted Exercised Expired
Lapsed
31 January
2021
Mark
Briffa
10 July
20171
173,611
—
—
—
173,611
—
75
187,500
108.0p
0.0p
10 July
2020
10 July
2027
11 July
2019
335,696
—
—
—
—
335,696
100
265,200
79.0p
0.0p
11 July
2022
11 July
2029
10 August
2020
—
503,919
—
—
—
503,919
150 450,000
89.3p
0.0p
11 August
2023
11 August
2030
Total
509,307
503,919
—
—
173,611
839,615
1 The performance conditions of this award were not met. The outcome from the performance conditions was EPS growth of 6.7% and TSR of 1.5%.
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Long Term Incentive Plan (LTIP) (audited) continued
Name
Number of options
Size
(% salary)
Face
value
Closing
share
price on
the day
before
grant
Exercise
price
Earliest date
of exercise
Expiry
date
Date of
grant
31 January
2020
Granted Exercised Expired
Lapsed
31 January
2021
Joanne
Estell
10 July
2019
182,278
—
—
—
—
182,278
75
144,000
79.0p
0.0p
11 July
2022
11 July
2029
11 August
2020
— 223,964
—
—
—
223,964
100 200,000
89.3p
0.0p
11 August
2023
11 August
2030
Total
182,278 223,964
—
—
—
406,242
The following performance conditions are attached to the LTIP awards:
Performance measure
Weighting
Performance
Vesting rate
2017
2019
2020
EPS
2/3rds
Threshold
25%
CPI +7.5%
6%
9.75p
Stretch
100%
CPI +12.5%
12%
10.70p
TSR
1/3rd
Threshold
25%
9% pa
9% pa
9% pa
Stretch
100%
16% pa
16% pa
16% pa
For intermediate performance between threshold and stretch, vesting will occur on a straight-line basis. There is no
vesting for any performance measure where the outcome is below threshold.
Awards granted from 2019 which vest after the end of the three-year performance period will be subject to an additional
two-year holding period. During this period the shares cannot be sold (other than as required for tax purposes). The
holding period is also applied post-employment for Executive Directors who leave after the performance period.
Awards made in 2020 were not scaled back as the share price at grant had returned to pre-COVID-19 levels.
No LTIP performance targets were amended in the year.
Share options
None of the Executive Directors hold any unexpired share options.
Directors’ beneficial interests in shares (audited)
The Directors who held office during the year had the following beneficial interests in ordinary shares of 1p each in the
Company, fully paid up, at the beginning of the year and end of the year:
31 January
2021
31 January
2020
Mark Briffa1
822,130
822,130
Joanne Estell2
38,030
11,363
Ed Warner
200,000
125,000
Paul Dollman
80,000
44,000
Amanda Wills
5,265
5,265
1 Mark Briffa’s holding is above the 100% of salary shareholding target based on the share price on 31 January 2021.
2 Joanne Estell joined the Board on 10 September 2018. Joanne’s target holding is 50% of salary over a five-year period.
Directors’ remuneration report continued
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CEO pay history
The table below sets out the details for the Director undertaking the role of Chief Executive Officer:
Year ending
CEO single figure of
total remuneration
£’000
Annual bonus
pay-out against
maximum opportunity
%
Vesting rates against
maximum opportunity
%
2021
644
66.7
—
2020
674
—
84.0
2019
805
—
100.0
2018
691
42.9
65.5
2017
652
50.1
—
2016
570
73.9
—
2015
271
—
66.7
2014 – 18 months
656
92.8
—
2012
249
16.8
—
2011
369
100.0
—
Percentage change in Directors’ remuneration
The table below shows the percentage change in remuneration of each of the Directors and the Group’s UK employees
as a whole between the year ended 31 January 2020, on an annualised basis, and 31 January 2021.
UK Air Partner employees employed by the Group in both January 2020 and January 2021 were chosen as the most
appropriate comparator group as this includes senior Executives and excludes international employees who are on
different pay structures.
Annual
%
Salary 1
Benefits 2
bonus 3
Mark Briffa
1.8
5.0
n/a
Joanne Estell
(2.0)
7.7
n/a
Ed Warner
—
—
—
Paul Dollman
—
—
—
Richard Jackson
—
—
—
Amanda Wills
—
—
—
Average pay based on all of the Group’s UK employees
2.7
4.6
n/a
1 The Executive and Non-executive Directors had a 20% pay decrease from March–June 2020. The increase in Mark Briffa’s salary is a result
of his pay increase made in August 2019 and the full year impact of this was seen in FY21.
2 There has been no significant change in the benefits offered in FY21. In a relatively small population, people opting in or out of benefits can
have a significant impact on the overall spend.
3 There was no bonus paid in respect of FY20.
Pay ratios
The government recently introduced legislation requiring all quoted companies with more than 250 UK employees
to publish the ratio of the Chief Executive Officer’s single figure to the actual total remuneration of full-time equivalent
employees. The tables below set out the ratio of the Chief Executive Officer’s pay as per the single figure of remuneration
table to the 25th percentile, median and 75th percentile total remuneration of the Group’s UK full-time equivalent
employees as at 31 January 2021. The Committee has opted to use Option A for calculating the pay ratio, in line with
best practice guidance.
Method
FY21
FY20
25th
percentile
pay ratio
Median
pay ratio
75th
percentile
pay ratio
25th
percentile
pay ratio
Median
pay ratio
75th
percentile
pay ratio
Salary
A
14:1
10:1
6:1
14:1
9:1
7:1
Total remuneration
A
28:1
19:1
12:1
31:1
21:1
13:1
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Air Partner plc | Annual Report 2021
Pay ratios continued
Salary
£
Total
remuneration
£
CEO
288,355
644,310
25th percentile employee
21,242
22,897
50th percentile employee
30,086
33,259
75th percentile employee
44,859
55,096
The decrease in the ratios on a total remuneration basis is a result of the payment of higher levels of variable pay for
eligible employees in FY21 due to the strong financial performance. Employees are our greatest asset and we ensure
that they are fairly remunerated for their contribution to the success of the Group. The Committee will monitor the
ratios on an annual basis.
Relative importance of spend on pay
2021
2020
% variance
Total employee pay compared to prior period (£’000)
27,319
23,030
19%
Profit before tax (£’000)
8,379
936
795%
Total dividends paid and declared (pence)
2.40
1.80
33%
Profit before tax as per the audited accounts has been used as a comparison as it is a key financial metric which the
Board considers when assessing our performance.
Performance graph
To help investors to measure our comparative performance, the graph below shows the change in the total
shareholder return of the Company for each of the past 10 financial years compared with the FTSE All Share Index.
We are not currently a constituent member of the FTSE All Share Index, but the Index has been selected as an
appropriate comparator because it is easily accessible by investors and covers the performance of a broad range
of companies, including aviation, transport and luxury retail businesses.
Directors’ remuneration report continued
Annual report on remuneration continued
Air Partner plc
FTSE All Share
0
50
100
150
200
250
31 Jan
2012
31 Jan
2013
31 Jan
2014
31 Jan
2015
31 Jan
2016
31 Jan
2017
31 Jan
2018
31 Jan
2019
31 Jan
2020
31 Jan
2021
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Air Partner plc | Annual Report 2021
Shareholder voting
At the 2019 AGM, the results of the votes on the Directors’ remuneration policy were:
Number of
% of votes
votes
cast
For (including discretionary)
12,566,645
97.45
Against
329,352
2.55
Votes withheld
28,139
—
At the 2020 AGM, the results of the votes on the Directors’ remuneration report were:
Number of
votes
% of votes
cast
For (including discretionary)
24,304,556
99.97
Against
7,516
0.03
Votes withheld
20,835
—
We consulted with major shareholders on the proposed remuneration policy changes in April 2019 and reflected
comments made in the policy proposed.
Remuneration in 2021/22
COVID-19 has created unprecedented challenges across the world with the travel and aviation sectors being
particularly hard hit. We have taken significant and appropriate steps on executive remuneration in light of these
circumstances and broader actions taken. The Remuneration Committee will continue to monitor the situation and take
necessary action.
The Remuneration Committee has set stretching targets for both Group financial performance and personal objectives
under the annual bonus plan. Detail on the targets is considered commercially sensitive and for this reason is not
disclosed during the current financial year. As in previous years, the performance measures and weightings for both
the CEO and CFO are underlying profit before tax (70%) and personal objectives (30%). Retrospective disclosure will
be made in next year’s Annual Report.
We will determine the performance conditions to be applied to the 2021 LTIP awards at the point of award and
disclose them in the announcement at that point and in next year’s Annual Report.
As mentioned earlier in the report, the Sharesave scheme was launched in FY21, with the first grant taking place
in February 2021.
The Directors’ remuneration report was approved by the Board on 11 May 2021 and is signed on its behalf by:
Amanda Wills
Chair of the Remuneration Committee
11 May 2021
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Air Partner plc | Annual Report 2021
UK Corporate Governance Code
P The Committee believes that the structure of the reward for Executive Directors and senior Executives should
be aligned to the Group’s strategy, purpose and values and as such a greater proportion of the package for
senior leadership roles is based on performance based pay through the annual bonus and LTIP. This ensures
the remuneration of the Executive Directors and the senior Executives is aligned with the performance of the
Company and therefore the interests of shareholders. The Committee believes the remuneration policy operated as
intended in respect of FY21 in terms of company performance and quantum. In early 2021, the Committee engaged
with major shareholders in respect of decisions in relation to the FY21 annual bonus. During FY21 the Company
engaged with employees and ran workshops on the People strategy which included remuneration and the
reward roadmap.
Q The Committee is constituted as a formal sub-committee of the Board with its own terms of reference. Its
primary role is to review and set the remuneration policy for the Executive Directors, within the context of
salaries and benefits paid across the Group as a whole, and to make discretionary performance related awards
to the Executive Directors. The full Board agrees the remuneration of the Chair and Non-executive Directors
on the principle that no individual should be able to determine their own remuneration.
R Annual bonus documentation and the LTIP scheme rules contain provisions to give the Committee the ability
to apply discretion to adjust formulaic outcomes in line with the Code but always within the limits as determined
by the new policy. Any use of discretion would be explained clearly in the Directors’ remuneration report.
Directors’ remuneration report continued
Annual report on remuneration continued
Examples of how the Committee has addressed Provision 40 of the Code
Clarity
The Committee is committed to transparency and has high levels of disclosure as laid out in our
Directors’ remuneration report which now includes this table addressing Provisions 40 and 41
of the Code.
Simplicity
The structure of the remuneration policy is as is commonly used by premium listed companies.
Risk
The Committee recognises the risk of target based plans and addresses this through careful
consideration of targets and their weighting, having adopted a two-year holding period for LTIPs
after vesting and enhanced malus and clawback provisions.
Predictability
A range of possible outcomes for Executive Director remuneration is set out set out on pages 81
to 83.
Proportionality
There is a clear link between individual awards and the delivery of strategy, particularly through the
financial and non-financial objectives of the bonus scheme which are disclosed retrospectively in
the Annual Report on Remuneration. The link of remuneration outcomes to long-term performance
is primarily through the LTIP which has stretching targets based on EPS and absolute share price
performance as well as vesting values being directly linked with share price performance.
Alignment
to culture
The remuneration policy is aligned to our core values, having been designed to ensure that
successful long-term partnership with shareholders delivers good rewards to the Executive
Directors, the senior leadership team and the workforce as a whole.
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Air Partner plc | Annual Report 2021
Directors’ report
The Directors present their Annual Report on the affairs of Air Partner plc, together with the financial statements and
Independent auditors’ report for the year ended 31 January 2021.
The Strategic report is a requirement of the Companies Act 2006 and can be found on pages 1 to 60. We have chosen
to include certain matters in the Strategic report that would otherwise be disclosed in this Directors’ report. The Strategic
report and the Directors’ report form the management report as required by Rule 4.1.5R of the Disclosure Guidance
and Transparency Rules. Other information that is relevant to the Directors’ report, and is incorporated by reference,
can be found as follows:
Disclosure
Location
General information
Page 121
Likely future developments and post-balance sheet events
Strategic report on pages 1 to 60
Directors’ dividend recommendation
Chair’s statement on pages 6 and 7
Employment of disabled persons
Page 76
Employee engagement
Corporate governance report on pages 61 to 67
Stakeholder engagement
Corporate governance report on pages 61 to 67
Corporate Governance Statement
Corporate governance report on page 62
Directors during year ended 31 January 2021
Corporate governance report on pages 70 and 71
Directors’ Responsibilities Statement
Statement of Directors’ responsibilities on page 100
Disclosure of information to auditors
Statement of Directors’ responsibilities on page 100
Financial instruments
Page 154
Share capital disclosures
Share capital note in the financial statements on page 164
Listing Rules disclosure
Information required by the Financial Conduct Authority’s Listing Rules can be found as set out below:
Listing Rule
Location
9.8.6(5)(6) UK Corporate Governance Code compliance
Corporate governance report on page 62
9.8.6(7) Unexpired term of service contract
Directors’ remuneration report on page 88
Directors and Directors’ interests
The names of the Company Directors including biographical details of the Directors and changes to directorships
during the reporting period are shown on page 71. Details of Directors’ interests in the shares of the Company are
shown on page 92.
Information on those Directors who will be offering themselves for election by shareholders at the 2021 AGM is
included in the Notice of Meeting on pages 170 to 181 and in the biographical details on page 71. This information is
incorporated into this report by reference.
Conflicts of interest
The Directors completed an annual review of their conflicts of interests. No Director had, during the year, any beneficial
interest in any contract significant to the Company’s business, other than a contract of employment. We have
procedures in place for managing conflicts of interest. Should Directors become aware that they, or their connected
parties, have an interest in an existing or proposed transaction with the Company, they are required to notify the Board
in writing or at the next Board meeting.
Directors’ indemnities and insurance
During the financial year we made qualifying third-party indemnity provisions for the benefit of our Directors
that remain in force at the date of approval of the financial statements. In certain circumstances, the Company can
indemnify Directors, in accordance with its Articles of Association, against costs incurred in the defence of legal
proceedings brought against them by virtue of their office. Directors’ and Officers’ liability insurance cover remains
in place to protect all Directors and senior managers.
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Air Partner plc | Annual Report 2021
Articles of Association
Any amendment to the Company’s Articles of Association may only
be made by passing a special resolution of the shareholders of the
Company. The Company’s Articles of Association are available online
at www.airpartnergroup.com.
Substantial shareholdings
As at 11 May 2021, we were aware of substantial interests in the Company’s
shares or had been notified of interests in voting rights under Chapter 5 of the
Disclosure and Transparency Rules, as follows:
Number
%
Nature
Shareholder
of shares
holding
of holding
Hargreaves Lansdown
7,433,286
11.69
Indirect
Schroders Investment Management
7,134,919
11.23
Indirect
Amati Global Investors
6,344,309
9.98
Indirect
The interests shown may include shares held under discretionary management
agreements for which the manager may not exercise voting rights.
Change of control –
significant contracts
There are a number of commercial
agreements that take effect, alter or
terminate upon a change of control
of the Company; none is considered
to be significant in terms of its
potential impact on the business
of the Group as a whole.
The Company does not have
agreements with any Director
or employee that would provide
compensation for loss of office
or employment resulting from a
takeover, except that provisions of
the Company’s share schemes and
plans may cause options and awards
granted to employees under such
schemes and plans to vest on
a takeover.
Branches
The Company and its subsidiaries
have established branches in Austria,
France and Singapore.
Political contributions
There were no political contributions
during the year (2020: £nil).
Directors’ statements
As required under the Companies Act
2006, the Code and the Disclosure
and Transparency Rules (DTRs),
various statements have been made
by the Board as set out on pages 61
to 96 and are incorporated into this
report by reference.
PricewaterhouseCoopers LLP have
conducted the audit of the Group’s
financial statements for the financial
year to 31 January 2021.
PricewaterhouseCoopers LLP
have indicated their willingness to
continue in office. In accordance
with Section 489 of the Companies
Act 2006, a resolution to reappoint
PricewaterhouseCoopers LLP as the
statutory auditors will be proposed
at the 2021 AGM.
Share capital structure,
buying back and shareholder rights
A resolution to revoke the restriction
on the authorised share capital of
the Company was passed at the
2020 AGM. The Company has one
class of ordinary shares which have
equal rights to dividends and capital
and to vote at general meetings
of the Company, as set out in the
Company’s Articles of Association.
The number of ordinary shares of
1p each issued and fully paid at
31 January 2021 was 63,562,601.
10,037,308 new shares were issued
during the year. No shares were
bought back during the year.
Options outstanding under all
employee share schemes amounted
to 4.2% of the Company’s issued
share capital as at 31 January 2021.
This includes options granted which
have not yet vested. The nominal
value of shares in respect of which
awards are granted on any date shall
not exceed 10% of the nominal amount
of the Company’s equity share capital
on the date of the award. Resolutions
to renew the authorities given to
Directors to allot shares, to disapply
certain pre‑emption rights and
to make market purchases of the
Company’s own shares, all subject to
appropriate limits, will be put to the
2021 AGM to replace the authorities
granted in 2020.
An Employee Benefit Trust (the
‘Trust’) holds ordinary shares in the
Company in order to satisfy options
under the Group’s share option
schemes. At 31 January 2021, the
number of ordinary shares held by
the Trust was 47,502. Shares in
which the Trust holds the beneficial
interest may not be voted upon and
the entitlement to receive dividends
is waived.
There are no specific restrictions
on the size of a holding nor on the
transfer of shares, which are both
governed by the general provisions
of the Articles of Association and
prevailing legislation.
The Directors are not aware of any
agreements between holders of the
Company’s shares that may result in
restrictions on the transfer of securities
or on voting rights. No person has
any special rights of control over the
Company’s share capital and all
issued shares are fully paid.
No individual or corporate entity has
the right to appoint a Director. The
appointment and replacement of
Directors is governed by the Articles
of Association, the UK Corporate
Governance Code, the Companies
Act 2006 and related legislation.
Directors’ report continued
Corporate governance
98
Air Partner plc | Annual Report 2021
Annual General Meeting
The 2021 AGM will be held at 12:30
on Thursday 8 July 2021 at 2 City
Place, Beehive Ring Road, Gatwick,
West Sussex RH6 0PA. The Notice of
AGM to shareholders can be found
on pages 170 to 181 and is being
delivered by provision of the Annual
Report at least 21 clear days before
the meeting, either by post, to those
shareholders who prefer a paper copy,
or by email, to those shareholders who
have agreed that we can communicate
with them electronically.
The Notice of AGM will be available
to download from the Investors
section on our website,
www.airpartnergroup.com/investors.
Proxy cards for the 2021 AGM
will not be sent to shareholders
unless specifically requested.
All shareholders are entitled to vote
on the resolutions put to the AGM
and all votes cast are counted,
whether in person or by proxy, by
means of a poll on every resolution
in the Notice of AGM.
Corporate governance
The Company’s Statement on
Corporate Governance can be
found in the Corporate governance
report on page 62 of these financial
statements. The Corporate governance
report forms part of this Directors’
report and is incorporated into it
by cross‑reference.
The Directors’ report was approved
by the Board on 11 May 2021 and is
signed by order of the Board by:
Judith Banks
General Counsel and
Company Secretary
11 May 2021
Corporate governance
99
Air Partner plc | Annual Report 2021
Statement of Directors’ responsibilities in respect of the financial statements
The Directors are responsible for
preparing the Annual Report and the
financial statements in accordance
with applicable law and regulation.
Company law requires the Directors
to prepare financial statements for
each financial year. Under that law
the Directors have prepared the
Group and the Company financial
statements in accordance with
international accounting standards
in conformity with the requirements
of the Companies Act 2006.
Additionally, the Financial Conduct
Authority’s Disclosure Guidance and
Transparency Rules require the
directors to prepare the Group
financial statements in accordance
with international financial reporting
standards adopted pursuant to
Regulation (EC) No 1606/2002 as it
applies in the European Union.
Under company law, Directors must
not approve the financial statements
unless they are satisfied that they
give a true and fair view of the state
of affairs of the Group and Company
and of the profit or loss of the Group
for that period. In preparing the
financial statements, the Directors
are required to:
‣ select suitable accounting policies
and then apply them consistently;
‣ state whether applicable
international accounting standards
in conformity with the
requirements of the Companies
Act 2006 and international
financial reporting standards
adopted pursuant to Regulation
(EC) No 1606/2002 as it applies
in the European Union have been
followed for the Group financial
statements and international
accounting standards in conformity
with the requirements of the
Companies Act 2006 have been
followed for the Company financial
statements, subject to any material
departures disclosed and explained
in the financial statements;
‣ make judgements and accounting
estimates that are reasonable and
prudent; and
‣ prepare the financial statements
on the going concern basis unless
it is inappropriate to presume that
the Group and Company will
continue in business.
The Directors are also responsible
for safeguarding the assets of the
Group and Company and hence for
taking reasonable steps for the
prevention and detection of fraud
and other irregularities.
The Directors are responsible
for keeping adequate accounting
records that are sufficient to show
and explain the Group’s and
Company’s transactions and disclose
with reasonable accuracy at any time
the financial position of the Group and
Company and enable them to ensure
that the financial statements and the
Directors’ remuneration report comply
with the Companies Act 2006.
The Directors are responsible for
the maintenance and integrity of the
Company’s website. Legislation in the
United Kingdom governing the
preparation and dissemination of
financial statements may differ from
legislation in other jurisdictions.
Directors’ confirmations
Each of the Directors, whose names
and functions are listed on pages 70
and 71, confirm that, to the best of
their knowledge:
‣ the Group financial statements,
which have been prepared in
accordance with international
accounting standards in
conformity with the requirements
of the Companies Act 2006 and
international financial reporting
standards adopted pursuant to
Regulation (EC) No 1606/2002 as
it applies in the European Union,
give a true and fair view of the
assets, liabilities, financial position
and profit of the Group;
‣ the Company financial statements,
which have been prepared in
accordance with international
accounting standards in
conformity with the requirements
of the Companies Act 2006, give a
true and fair view of the assets,
liabilities, financial position and
profit of the Company; and
‣ the Directors’ report, or where
otherwise indicated the Strategic
report or other parts of the Annual
Report, includes a fair review of
the development and performance
of the business and the position of
the Group and Company, together
with a description of the principal
risks and uncertainties that it faces.
In the case of each Director in office
at the date the Directors’ report
is approved:
‣ so far as the Director is aware,
there is no relevant audit
information of which the Group
and Company’s auditors
are unaware; and
‣ they have taken all the steps
that they ought to have taken
as a Director in order to make
themselves aware of any relevant
audit information and to establish
that the Group and Company’s
auditors are aware of that
information.
Mark Briffa
Chief Executive Officer
Joanne Estell
Chief Financial Officer
11 May 2021
Corporate governance
100
Air Partner plc | Annual Report 2021
Financial statements
101
Air Partner plc | Annual Report 2021
Financial statements
102 Independent auditors’ report
113 Consolidated income statement
113 Consolidated statement of comprehensive income
114 Consolidated statement of changes in equity
115 Company statement of changes in equity
116 Consolidated statement of financial position
118 Company statement of financial position
120 Consolidated and Company statement of cash flows
121 Notes to the financial statements
Shareholder information
170 Notice of Annual General Meeting
178 Explanation of the resolutions to be proposed at the AGM
182 Company information
Financial statements and
shareholder information
Independent auditors’ report
to the members of Air Partner plc
Report on the audit of the financial statements
Opinion
In our opinion, Air Partner plc’s Group financial statements and company financial statements
(the “financial statements”):
‣ give a true and fair view of the state of the Group’s and of the company’s affairs as at 31 January 2021 and of the
Group’s profit and the Group’s and company’s cash flows for the year then ended;
‣ have been properly prepared in accordance with international accounting standards in conformity with the
requirements of the Companies Act 2006; and
‣ have been prepared in accordance with the requirements of the Companies Act 2006.
We have audited the financial statements, included within the Annual Report, which comprise: the consolidated
and company statements of financial position as at 31 January 2021; the consolidated income statement and
consolidated statement of comprehensive income, the consolidated and company statements of cash flows, and the
consolidated and company statements of changes in equity for the year then ended; and the notes to the financial
statements, which include a description of the significant accounting policies.
Our opinion is consistent with our reporting to the Audit and Risk Committee.
Separate opinion in relation to International Financial Reporting Standards adopted
pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union
As explained in note 2a to the financial statements, the Group, in addition to applying international accounting
standards in conformity with the requirements of the Companies Act 2006, has also applied International Financial
Reporting Standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union.
In our opinion, the Group financial statements have been properly prepared in accordance with International Financial
Reporting Standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable
law. Our responsibilities under ISAs (UK) are further described in the Auditors’ responsibilities for the audit of the
financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Independence
We remained independent of the Group in accordance with the ethical requirements that are relevant to our audit of
the financial statements in the UK, which includes the FRC’s Ethical Standard, as applicable to listed public interest
entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements.
To the best of our knowledge and belief, we declare that non-audit services prohibited by the FRC’s Ethical Standard
were not provided.
Other than those disclosed in note 6, we have provided no non-audit services to the company or its controlled
undertakings in the period under audit.
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Air Partner plc | Annual Report 2021
Financial statements
Report on the audit of the financial statements continued
Our audit approach
Overview
Audit scope
‣ We performed full scope audit procedures on two trading entities.
‣ We then extended our testing in relation to the French tax investigation, which is referred to in note 2w to the
financial statements, within Air Partner International S.A.S; the leased Italian plane within Air Partner Srl, included
within the IFRS 16 right of use asset disclosure in note 15; and certain material balances in other entities, as required
to ensure we achieved our required levels of audit coverage.
‣ Overall, these audit procedures provided coverage of 70% of consolidated revenue, 76% of consolidated profit before
income tax and exceptional and other items on absolute basis, and 78% of consolidated profit before income tax on
absolute basis.
‣ All work was performed by the Group UK engagement team.
Key audit matters
‣ Consideration of the impact of COVID-19 (Group and company)
‣ French tax investigation (Group)
‣ Impairment of goodwill, intangible and right of use assets (Group and company)
‣ Classification of exceptional and other items (Group)
Materiality
‣ Overall Group materiality: £500,000 (2020: £215,000) based on a careful consideration of the level at which a
change in reported profitability could materially change the views of users, this equated to approximately 4.3%
of profit before income tax and exceptional and other items (2020: 5% of profit before income tax and exceptional
and other items).
‣ Overall company materiality: £400,000 (2020: £190,000) based on 1% of total assets of the Company capped at an
allocation of the overall Group materiality which enables us to obtain sufficient audit coverage over the profitability
of the Group (2020: 5% of profit before income tax and exceptional and other items).
‣ Performance materiality: £375,000 (Group) and £300,000 (company).
The scope of our audit
As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the
financial statements.
Key audit matters
Key audit matters are those matters that, in the auditors’ professional judgement, were of most significance in the
audit of the financial statements of the current period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) identified by the auditors, including those which had the greatest effect
on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement
team. These matters, and any comments we make on the results of our procedures thereon, were addressed in the
context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.
This is not a complete list of all risks identified by our audit.
Accounting for the acquisition of Redline Worldwide Limited, which was a key audit matter last year, is no longer
included because of the acquisition occurring in the prior year and hence this is not applicable for the current year.
Otherwise, the key audit matters below are consistent with last year.
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Air Partner plc | Annual Report 2021
Financial statements
Independent auditors’ report continued
to the members of Air Partner plc
Report on the audit of the financial statements continued
Our audit approach continued
Key audit matters continued
Key audit matter
How our audit addressed the key audit matter
Consideration of the impact of COVID-19 (Group
and company)
The COVID-19 pandemic is considered to have a
potential impact on certain aspects of the financial
statements. The areas which might be expected to be
impacted by COVID-19 are as set out below:
‣ Recoverability of accounts receivable
‣ Impairment of goodwill and other intangibles
‣ Going concern
‣ Receipt of Government support
‣ Disclosure of the impact on the business
We have also had regard to the guidance for auditors
issued by the FRC in March 2020 and updated in
December 2020 regarding COVID-19 and applied this
where appropriate.
We note the pandemic has resulted in the audit having
to take place largely remotely.
An assessment of the Directors' consideration of the
impact of the pandemic on the business is set out in
various places in the Strategic and Directors’ reports,
alongside disclosure of the impact on management’s
going concern assessment in note 2c, restructuring
costs classified as exceptional in note 7, and the impact
of government support received across the Group in
notes 8 and 35.
We have considered the impact of COVID-19 on various
areas of the Annual Report and performed procedures to
address the assessed risk potentially arising from the impact
of COVID-19, most notably in the assessment of going
concern and viability, potential impairment of assets and
disclosures in relation to government support received.
We have set out our responses to the risk in respective
areas of the financial statements as below:
‣ Recoverability of accounts receivable:
We have considered the adequacy of provisions for
impairment of accounts receivable, testing the IFRS
expected credit loss provisions, and considering the history
of collections of accounts receivable since the start of
pandemic restrictions and any identified concerns regarding
the creditworthiness of debtors. We consider the IFRS 9
provision booked by management to be appropriate.
‣ Impairment of goodwill and other intangibles:
We have considered the various scenarios surrounding the
potential impact of COVID-19 on future cash flows
supporting the carrying value of goodwill, intangibles and
right of use assets, as detailed in our key audit matter below.
‣ Going concern:
We have obtained management’s latest cash flow forecasts,
which cover the period to 31 July 2022, and the Directors'
going concern assessment. We have had regard to the
Group’s strong trading performance over the last year and
the strengthening of the Group’s statement of financial
position. Our detailed procedures on going concern are set
out below in “Conclusions relating to going concern”.
‣ Receipt of government support:
We have tested government support received back to
supporting evidence, and challenged management on
the Group’s eligibility for the support received.
‣ Disclosure of impact in the financial statements:
We have evaluated the disclosures provided in the
financial statements and assessed the reasonableness
of such disclosures, in line with relevant accounting
standards and guidance from the FRC. In particular
we ensured that disclosures surrounding government
support received were accurate and suitably transparent.
As a result of the procedures performed, we consider
that the disclosures are reasonable and appropriate.
Whilst we have undertaken much of our audit work
remotely, we did not encounter any significant difficulties
in performing our audit testing or in obtaining the
required evidence to support our audit conclusions.
Overall, we consider management’s assessment of the
impact of COVID-19 on the financial statements to be
reasonable and appropriately accounted for and
reflected within disclosures in the Annual Report.
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Air Partner plc | Annual Report 2021
Financial statements
Key audit matter
How our audit addressed the key audit matter
French tax investigation (Group)
During the previous year, Air Partner International S.A.S.,
a wholly owned subsidiary of the Group, was subject to
a tax reassessment in relation to indirect and corporate
taxes covering returns and transactions from 1 February
2015 to 31 January 2018, extended to 31 September 2018
for VAT. This resulted in the French Tax Administration
challenging the treatment of various items from a tax
perspective by the company, and issuing a demand for
additional payment and fines in respect of the tax
treatment of these items in the above stated period.
Evaluating the financial impact of matters of this nature
is inherently uncertain and as such management have
applied significant judgement in determining the likely
outcome of the investigation and estimating the
associated provision for any future payments that may
be due.
Management have received external advice from their
own experts in responding to the reassessment and in
evaluating the financial impact the assessment could
have on the French business and Group financial
statements.
Having regard to this advice the Directors established
a provision of £283,000 (€337,000) in the prior year
which remains unchanged, other than the impact of
foreign exchange movements, resulting in a provision
of £298,000 (€337,000) in the current year, reflecting
management’s best estimate of the potential impact
of matters identified by the French Tax Administration.
Having regard to the quantum of the gross
reassessment, which is material in the context of
the Group financial statements, and the fact that
there is a high degree of judgement around any final
determination this was a key audit focus area for us.
Further information is set out in notes 2w and 7.
We obtained and read the tax reassessment issued by the
French Tax Administration in the prior year, the company’s
response it issued to the French Tax Administration, and all
other relevant correspondence between the company, the
French Tax Administration and the company’s external
experts in the previous year.
We held discussions with management, their external experts
and our UK tax specialists to challenge management’s
evaluation of the assessment during the current year.
We note that no further correspondence from the French
VAT authorities occurred during the year, something we
validated from discussions with management, review of
Board minutes and confirmation from the Group’s external
legal advisers acting on their behalf in France.
From our detailed testing performed in the current and
prior year, the confirmation from management’s experts
and other related correspondence, there was no evidence
to suggest a change in the level of provision booked in the
prior year was warranted.
In addition to the above we read, and considered the
disclosures made in the financial statements in respect of
the tax reassessment and found these were reasonable.
Report on the audit of the financial statements continued
Our audit approach continued
Key audit matters continued
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Air Partner plc | Annual Report 2021
Financial statements
Independent auditors’ report continued
to the members of Air Partner plc
Key audit matter
How our audit addressed the key audit matter
Impairment of goodwill, intangibles and right of use
assets (Group and company)
As set out in notes 13, 14 and 15, the Group’s
consolidated statement of financial position as at
31 January 2021 includes goodwill of £8,692k, other
intangible assets relating to various acquisitions made
in previous years of £8,715k, and a right of use asset
in relation to a leased Italian plane of £3,705k.
Management are required to assess whether the
carrying value of goodwill, other intangible assets and
right of use assets are supported by the present value
of future discounted cash flows generated by the
related business and if there they are not impair the
balances to a level that is supported by the cash flows.
The cash flow forecasts which support the impairment
review performed by the Group include a number of
significant estimates including future revenue growth,
profit margins, the terminal growth rate, and the
discount rate.
During the year, after consideration of management’s
impairment testing, no impairment was noted. Given the
materiality of the amounts involved and the importance
of the estimation process in determining whether any
impairment is required this was an area of focus for us.
We tested all material components of goodwill, intangibles
and right of use assets. Certain constituent parts required
greater focus given the materiality of the amounts involved
and the relative levels of headroom in the impairment
assessments, notably the associated balances relating to
SafeSkys Limited (goodwill: £1,167k; intangible assets:
£411k), Air Partner International S.A.S. (goodwill: £987k),
Redline Aviation Security Ltd (goodwill: £3,644k;
intangible assets: £5,090k) and the leased Italian plane
(right of use asset: £3,705k).
We obtained management’s impairment model for each
related balance and performed the following procedures:
i) evaluated the reasonableness of key assumptions
in the model, including future forecast changes in
revenues, costs and associated cash flows as well as
terminal growth rates and the discount rates applied.
Our work was supported by our valuations experts to
assess the discount rate used by management in the
impairment workings;
ii) challenged management to substantiate key
assumptions, including a ‘look-back’ analysis to
compare management’s assumptions in prior year
budgets with current year actuals performance;
iii) tested the mathematical accuracy of management’s
impairment model and supporting calculations;
iv) obtained and reviewed a copy of the updated Italian
plane agreement which delayed contractual terms and
payment obligations until 2022; and
v) obtained and evaluated management’s sensitivity
analyses to evaluate the financial impact of reasonable
changes in key assumptions.
As a result of our work performed, we have determined
that the carrying value of goodwill, intangibles and right
of use assets is appropriately supported and as such no
impairment is required.
We read the disclosures made in note 13, in relation to the
more significant components of goodwill with tighter levels
of headroom, including the sensitivity analysis and the
associated sources of estimation uncertainty disclosed
within note 2, and found these disclosures to be appropriate.
Report on the audit of the financial statements continued
Our audit approach continued
Key audit matters continued
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Air Partner plc | Annual Report 2021
Financial statements
Key audit matter
How our audit addressed the key audit matter
Classification of exceptional and other items (Group)
As described in note 2v the Directors believe that
underlying profit before tax and earnings per share
measures provide additional useful information for
shareholders on the underlying performance of the
business. These alternative performance measures
are disclosed prominently in various sections of the
Annual Report.
The Directors define underlying profit as profit before
income tax and exceptional and other items, which are
set out in note 7 to the financial statements.
There is a risk that costs incurred by the Group are
inappropriately classified as exceptional and other items
in order to inappropriately enhance the perceived
performance of the Group, or that items of income or
other gains received in the year which should be
classified as exceptional and other items are excluded
and reported within underlying profit.
During the year, the Directors classified £3,179k as
exceptional and other items before taxation.
We obtained management’s detailed analysis of exceptional
and other items and performed the following procedures:
i) tested a sample of items classified as exceptional and
other items back to supporting documents to ensure
that these were accurately recorded;
ii) evaluated the nature of the items tested to ensure that
these were appropriately classified as exceptional and
other items by reference to management’s definition of
underlying profit, as set out in note 2v, and established
regulatory guidance on the reporting of alternative
performance measures; and
iii) we evaluated the nature of items of income and
other gains received in the year that had not been
reported within exceptional and other items to assess
whether any of these should not be included within
underlying profit.
We read the disclosures in notes 2 and 7 to the financial
statements to ensure these provided clear and sufficient
guidance to enable the user of the financial statements
to understand the nature and magnitude of the items
included within exceptional and other items, and why
management have excluded these items from underlying
profit. We found these to be appropriate.
How we tailored the audit scope
We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion
on the financial statements as a whole, taking into account the structure of the Group and the company,
the accounting processes and controls, and the industry in which they operate.
The Group consists of sixteen trading companies, of which two are considered to be significant components of the
Group. These are Air Partner plc in the UK and Air Partner Inc. in the USA. We have performed full-scope audits for
both of these 100% owned subsidiaries of the Group. These audits were performed by the UK Group engagement
team. We then extended our testing in relation to the French tax investigation within Air Partner International S.A.S.;
the leased Italian plane within Air Partner Srl; and certain material balances in other entities, as required to ensure
we achieved required levels of audit coverage.
Report on the audit of the financial statements continued
Our audit approach continued
Key audit matters continued
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Air Partner plc | Annual Report 2021
Financial statements
Independent auditors’ report continued
to the members of Air Partner plc
Report on the audit of the financial statements continued
Our audit approach continued
Materiality
The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for
materiality. These, together with qualitative considerations, helped us to determine the scope of our audit and the
nature, timing and extent of our audit procedures on the individual financial statement line items and disclosures and
in evaluating the effect of misstatements, both individually and in aggregate on the financial statements as a whole.
Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:
Financial statements – Group
Financial statements – company
Overall materiality
£500,000 (2020: £215,000).
£400,000 (2020: £190,000).
How we determined it
Based on a careful consideration of the level at
which a change in reported profitability could
materially change the views of users, this
equated to approximately 4.3% of profit before
income tax and exceptional and other items
(2020: 5% of profit before income tax and
exceptional and other items).
Based on 1% of total assets of the Company
capped at an allocation of the overall
Group materiality which enables us to
obtain sufficient audit coverage over the
profitability of the Group (2020: 5% of
profit before income tax and exceptional
and other items and gross profit).
Rationale for
benchmark applied
Within the Group there is a focus on business
performance driven by gross profit. At the
same time, the business remains focused on
achieving an acceptable profit before income
tax and exceptional and other items. Having
regard to both the size of the business and its
profitability, the various users of the financial
statements and our views as to what they
would perceive as material items, particularly in
the context of income statement adjustments,
£500,000 was viewed as an appropriate level
to set materiality at.
Within the company there is a focus on
business performance driven by gross
profit. At the same time, the business
remains focused on achieving
an acceptable profit before income tax
and exceptional and other items, and
maintaining a robust balance sheet. Having
regard to both the size of the business and
its profitability, £400,000 was viewed as
an appropriate level to set materiality at.
For each component in the scope of our Group audit, we allocated a materiality that was less than our overall Group
materiality. The range of materiality allocated across components was £400,000 to £450,000. Certain components
were audited to a local statutory audit materiality that was also less than our overall Group materiality.
We use performance materiality to reduce to an appropriately low level the probability that the aggregate of uncorrected
and undetected misstatements exceeds overall materiality. Specifically, we use performance materiality in determining
the scope of our audit and the nature and extent of our testing of account balances, classes of transactions and disclosures,
for example in determining sample sizes. Our performance materiality was 75% of overall materiality, amounting to
£375,000 for the Group financial statements and £300,000 for the company financial statements.
In determining the performance materiality, we considered a number of factors – the history of misstatements, risk
assessment and aggregation risk and the effectiveness of controls – and concluded that an amount at the upper end
of our normal range was appropriate.
We agreed with the Audit and Risk Committee that we would report to them misstatements identified during our
audit above £25,000 (Group audit) (2020: £10,750) and £20,000 (company audit) (2020: £9,500) as well
as misstatements below those amounts that, in our view, warranted reporting for qualitative reasons.
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Financial statements
Report on the audit of the financial statements continued
Conclusions relating to going concern
Our evaluation of the Directors’ assessment of the Group's and the company’s ability to continue to adopt the going
concern basis of accounting included:
‣ obtaining management’s latest cash flow forecasts, which cover the period to 31 July 2022, and the Directors going
concern assessment;
‣ testing the mathematical accuracy of the cash flow forecast model;
‣ assessing the reasonableness of key assumptions supporting the cash flow forecasts including revenue and cost
projections, mitigating cost actions identified by the Directors, and other assumptions over government support
schemes in the Group’s key territories;
‣ evaluating forecast revenues by reference to current, post pandemic and historical performance, sensitised to reflect
a variety of different downside scenarios to reflect the consequence of the potential ongoing impact of COVID-19 on
the Group’s different markets;
‣ assessing the impact of financial obligations arising from existing contractual relationships to ensure that these were
appropriately reflected in the cash flow forecasts.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions
that, individually or collectively, may cast significant doubt on the Group's and the company’s ability to continue as a
going concern for a period of at least twelve months from when the financial statements are authorised for issue.
In auditing the financial statements, we have concluded that the Directors’ use of the going concern basis of
accounting in the preparation of the financial statements is appropriate.
However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the
Group's and the company's ability to continue as a going concern.
In relation to the Directors’ reporting on how they have applied the UK Corporate Governance Code, we have nothing
material to add or draw attention to in relation to the Directors’ statement in the financial statements about whether
the Directors considered it appropriate to adopt the going concern basis of accounting.
Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the
relevant sections of this report.
Reporting on other information
The other information comprises all of the information in the Annual Report other than the financial statements and
our auditors’ report thereon. The Directors are responsible for the other information. Our opinion on the financial
statements does not cover the other information and, accordingly, we do not express an audit opinion or, except
to the extent otherwise explicitly stated in this report, any form of assurance thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the financial statements or
our knowledge obtained in the audit, or otherwise appears to be materially misstated. If we identify an apparent
material inconsistency or material misstatement, we are required to perform procedures to conclude whether there
is a material misstatement of the financial statements or a material misstatement of the other information. If, based
on the work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report based on these responsibilities.
With respect to the Strategic report and Directors' report, we also considered whether the disclosures required by the
UK Companies Act 2006 have been included.
Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report certain
opinions and matters as described below.
109
Air Partner plc | Annual Report 2021
Financial statements
Independent auditors’ report continued
to the members of Air Partner plc
Report on the audit of the financial statements continued
Reporting on other information continued
Strategic report and Directors' report
In our opinion, based on the work undertaken in the course of the audit, the information given in the Strategic report
and Directors' report for the year ended 31 January 2021 is consistent with the financial statements and has been
prepared in accordance with applicable legal requirements.
In light of the knowledge and understanding of the Group and company and their environment obtained in the course
of the audit, we did not identify any material misstatements in the Strategic report and Directors' report.
Directors’ remuneration
In our opinion, the part of the Directors’ remuneration report to be audited has been properly prepared in accordance
with the Companies Act 2006.
Corporate governance statement
The Listing Rules require us to review the Directors’ statements in relation to going concern, longer-term viability and
that part of the corporate governance statement relating to the company’s compliance with the provisions of the UK
Corporate Governance Code specified for our review. Our additional responsibilities with respect to the corporate
governance statement as other information are described in the Reporting on other information section of this report.
Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the
corporate governance statement is materially consistent with the financial statements and our knowledge obtained
during the audit, and we have nothing material to add or draw attention to in relation to:
‣ the Directors’ confirmation that they have carried out a robust assessment of the emerging and principal risks;
‣ the disclosures in the Annual Report that describe those principal risks, what procedures are in place to identify
emerging risks and an explanation of how these are being managed or mitigated;
‣ the Directors’ statement in the financial statements about whether they considered it appropriate to adopt the
going concern basis of accounting in preparing them, and their identification of any material uncertainties to the
Group’s and company’s ability to continue to do so over a period of at least twelve months from the date of approval
of the financial statements;
‣ the Directors’ explanation as to their assessment of the Group's and company’s prospects, the period this
assessment covers and why the period is appropriate; and
‣ the Directors’ statement as to whether they have a reasonable expectation that the company will be able to continue
in operation and meet its liabilities as they fall due over the period of its assessment, including any related
disclosures drawing attention to any necessary qualifications or assumptions.
Our review of the Directors’ statement regarding the longer-term viability of the Group was substantially less in scope
than an audit and only consisted of making inquiries and considering the Directors’ process supporting their
statement; checking that the statement is in alignment with the relevant provisions of the UK Corporate Governance
Code; and considering whether the statement is consistent with the financial statements and our knowledge and
understanding of the Group and company and their environment obtained in the course of the audit.
In addition, based on the work undertaken as part of our audit, we have concluded that each of the following elements
of the corporate governance statement is materially consistent with the financial statements and our knowledge
obtained during the audit:
‣ the Directors’ statement that they consider the Annual Report, taken as a whole, is fair, balanced and
understandable, and provides the information necessary for the members to assess the Group’s and
company's position, performance, business model and strategy;
‣ the section of the Annual Report that describes the review of effectiveness of risk management and internal control
systems; and
‣ the section of the Annual Report describing the work of the Audit and Risk Committee.
We have nothing to report in respect of our responsibility to report when the Directors’ statement relating to the
company’s compliance with the Code does not properly disclose a departure from a relevant provision of the Code
specified under the Listing Rules for review by the auditors.
110
Air Partner plc | Annual Report 2021
Financial statements
Report on the audit of the financial statements continued
Responsibilities for the financial statements and the audit
Responsibilities of the Directors for the financial statements
As explained more fully in the Statement of Directors’ responsibilities in respect of the financial statements, the
Directors are responsible for the preparation of the financial statements in accordance with the applicable framework
and for being satisfied that they give a true and fair view. The Directors are also responsible for such internal control as
they determine is necessary to enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the Directors are responsible for assessing the Group’s and the company’s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the Directors either intend to liquidate the Group or the company or to cease
operations, or have no realistic alternative but to do so.
Auditors’ responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with
ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line
with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud.
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Based on our understanding of the Group and industry, we identified that the principal risks of non-compliance with laws
and regulations related to government grants (specifically CJRS), the listing rules of the Financial Conduct Authority
(FCA) and tax regulations, competition law, employment regulation, health and safety legislation and Civil Aviation
Authority (CAA) regulations, and we considered the extent to which non-compliance might have a material effect on
the financial statements. We also considered those laws and regulations that have a direct impact on the financial
statements such as the Companies Act 2006. We evaluated management’s incentives and opportunities for fraudulent
manipulation of the financial statements (including the risk of override of controls), and determined that the principal
risks were related to posting inappropriate journal entries, and management bias in accounting estimates including
valuation of deferred consideration and other liabilities. Audit procedures performed by the engagement team included:
In respect of the principal risks of non-compliance with laws and regulations:
‣ Testing government support received back to supporting evidence, as set out in our Consideration of the impact
of COVID-19 key audit matter.
‣ Reading key correspondence with regulatory authorities, such as the CAA and the French VAT authorities.
In respect of the principal risks of fraudulent manipulation of the financial statements (including the risk of override
of controls):
‣ Challenging assumptions made by management in their significant accounting judgements and estimates in
particular in relation to items classified as Exceptional and other items, Goodwill and Intangible impairment
assumptions, and deferred consideration.
‣ Evaluating and testing journal entries which may be indicative of fraud, for example any journal entries posted with
unusual account combinations, journals posted by senior management, and unexpected consolidation journals.
‣ Review of disclosures included in the financial statements to ensure key judgements and estimates are presented
in a way that is fair, balanced and understandable.
111
Air Partner plc | Annual Report 2021
Financial statements
Report on the audit of the financial statements continued
Responsibilities for the financial statements and the audit continued
Auditors’ responsibilities for the audit of the financial statements continued
There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances
of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the
financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not
detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional
misrepresentations, or through collusion.
Our audit testing might include testing complete populations of certain transactions and balances, possibly using data
auditing techniques. However, it typically involves selecting a limited number of items for testing, rather than testing
complete populations. We will often seek to target particular items for testing based on their size or risk characteristics.
In other cases, we will use audit sampling to enable us to draw a conclusion about the population from which the
sample is selected.
A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at:
www.frc.org.uk/auditorsresponsibilities. This description forms part of our Independent auditors’ report.
Use of this report
This report, including the opinions, has been prepared for and only for the company’s members as a body in
accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these
opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown
or into whose hands it may come save where expressly agreed by our prior consent in writing.
Other required reporting
Companies Act 2006 exception reporting
Under the Companies Act 2006 we are required to report to you if, in our opinion:
‣ we have not obtained all the information and explanations we require for our audit; or
‣ adequate accounting records have not been kept by the company, or returns adequate for our audit have not been
received from branches not visited by us; or
‣ certain disclosures of Directors’ remuneration specified by law are not made; or
‣ the company financial statements and the part of the Directors’ remuneration report to be audited are not
in agreement with the accounting records and returns.
We have no exceptions to report arising from this responsibility.
Appointment
Following the recommendation of the Audit and Risk Committee, we were appointed by the Directors on 22 November 2018
to audit the financial statements for the year ended 31 January 2019 and subsequent financial periods. The period of
total uninterrupted engagement is three years, covering the years ended 31 January 2019 to 31 January 2021.
Andrew Latham (Senior Statutory Auditor)
for and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
Crawley
11 May 2021
Independent auditors’ report continued
to the members of Air Partner plc
112
Air Partner plc | Annual Report 2021
Financial statements
Consolidated income statement
for the year ended 31 January 2021
Year ended
Year ended
31 January
31 January
2021
2020
Continuing operations
Note
£’000
£’000
Gross transaction value (GTV)
2
274,785
236,816
Revenue
3
71,173
66,664
Gross profit
4
44,870
34,158
Administrative expenses before exceptional and other items
(32,071)
(29,180)
Other operating income
43
—
Exceptional and other items
7
(3,179)
(3,296)
Total administrative expenses
(35,207)
(32,476)
Net impairment losses on financial assets
(810)
(205)
Operating profit
5
8,853
1,477
Operating profit before exceptional and other items
12,032
4,773
Finance income
9
29
71
Finance costs
9
(503)
(612)
Finance costs – net
(474)
(541)
Profit before income tax
8,379
936
Profit before income tax and exceptional and other items
11,558
4,232
Income tax expense
10
(2,747)
(633)
Profit for the year
5,632
303
Attributable to:
Owners of the parent company
5,632
303
Earnings per share:
Continuing operations
Basic
12
9.4p
0.6p
Diluted
12
9.3p
0.6p
Consolidated statement of comprehensive income
for the year ended 31 January 2021
Year ended
Year ended
31 January
31 January
2021
2020
Note
£’000
£’000
Profit for the year
5,632
303
Other comprehensive expense – items that may subsequently be reclassified to
profit or loss:
Adoption of IFRS 16
—
(167)
Exchange differences on translation of foreign operations
(743)
(403)
Total other comprehensive expense
(743)
(570)
Total comprehensive income/(expense) for the year
4,889
(267)
Attributable to:
Owners of the parent company
4,889
(267)
The above consolidated income statement and consolidated statement of comprehensive income should be read in
conjunction with the accompanying notes.
113
Air Partner plc | Annual Report 2021
Financial statements
Consolidated statement of changes in equity
for the year ended 31 January 2021
Share
Own
Share
premium
Merger
shares
Translation
Retained
Total
capital
account
reserve
reserve
reserve
earnings
equity
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Opening equity as at 1 February 2019
522
4,814
295
(326)
1,064
5,312
11,681
Adoption of IFRS 16
—
—
—
—
—
(167)
(167)
Profit for the year
—
—
—
—
—
303
303
Exchange differences on translation of
foreign operations
—
—
—
—
(403)
—
(403)
Total comprehensive expense for the year
—
—
—
—
(403)
136
(267)
Transactions with owners of the Company:
Issue of shares
13
1,081
—
—
—
(435)
659
Share option charge for the year
—
—
—
—
—
59
59
Share options exercised during the year
—
—
—
168
—
(146)
22
Dividends paid (note 11)
—
—
—
—
—
(2,961)
(2,961)
Transactions with owners of the Company
13
1,081
—
168
—
(3,483)
(2,221)
Closing equity as at 31 January 2020
535
5,895
295
(158)
661
1,965
9,193
Share
Own
Share
premium
Merger
shares
Translation
Retained
Total
capital
account
reserve
reserve
reserve
earnings
equity
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Opening equity as at 1 February 2020
535
5,895
295
(158)
661
1,965
9,193
Profit for the year
—
—
—
—
—
5,632
5,632
Exchange differences on translation of
foreign operations
—
—
—
—
(743)
—
(743)
Total comprehensive income for the year
—
—
—
—
(743)
5,632
4,889
Transactions with owners of the Company:
Issue of shares (note 28)
101
56
6,895
—
—
—
7,052
Redemption of shares (note 28)
—
—
(6,895)
—
—
6,895
—
Share option charge for the year
—
—
—
—
—
451
451
Share options exercised during the year
—
—
—
91
—
(86)
5
Dividends paid (note 11)
—
—
—
—
—
(508)
(508)
Transactions with owners of the Company
101
56
—
91
—
6,752
7,000
Closing equity as at 31 January 2021
636
5,951
295
(67)
(82)
14,349
21,082
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
114
Air Partner plc | Annual Report 2021
Financial statements
Company statement of changes in equity
for the year ended 31 January 2021
Share
Own
Share
premium
Merger
shares
Retained
Total
capital
account
reserve
reserve
earnings
equity
£’000
£’000
£’000
£’000
£’000
£’000
Opening equity as at 1 February 2019
522
4,814
295
(326)
6,917
12,222
Adoption of IFRS 16
—
—
—
—
(51)
(51)
Profit for the year
—
—
—
—
1,974
1,974
Total comprehensive income for the year
—
—
—
—
1,923
1,923
Transactions with owners of the Company:
Issue of shares
13
1,081
—
—
(435)
659
Share option charge for the year
—
—
—
—
59
59
Share options exercised during the year
—
—
—
168
(146)
22
Dividends paid (note 11)
—
—
—
—
(2,961)
(2,961)
Transactions with owners of the Company
13
1,081
—
168
(3,483)
(2,221)
Closing equity as at 31 January 2020
535
5,895
295
(158)
5,357
11,924
Share
Own
Share
premium
Merger
shares
Retained
Total
capital
account
reserve
reserve
earnings
equity
£’000
£’000
£’000
£’000
£’000
£’000
Opening equity as at 1 February 2020
535
5,895
295
(158)
5,357
11,924
Profit for the year
—
—
—
—
8,093
8,093
Total comprehensive income for the year
—
—
—
—
8,093
8,093
Transactions with owners of the Company:
Issue of shares (note 28)
101
56
6,895
—
—
7,052
Redemption of shares (note 28)
—
—
(6,895)
—
6,895
—
Share option charge for the year
—
—
—
—
451
451
Share options exercised during the year
—
—
—
91
(86)
5
Dividends paid (note 11)
—
—
—
—
(508)
(508)
Transactions with owners of the Company
101
56
—
91
6,752
7,000
Closing equity as at 31 January 2021
636
5,951
295
(67)
20,202
27,017
The above Company statement of changes in equity should be read in conjunction with the accompanying notes.
115
Air Partner plc | Annual Report 2021
Financial statements
Consolidated statement of financial position
as at 31 January 2021
31 January
31 January
2021
2020
Note
£’000
£’000
ASSETS
Non-current assets
Goodwill
13
8,692
8,641
Other intangible assets
14
9,260
11,872
Property, plant and equipment
15
6,047
7,698
Deferred tax assets
26
700
284
Total non-current assets
24,699
28,495
Current assets
Trade and other receivables
17
9,908
18,801
Current tax assets
816
318
JetCard bank balances
17,805
16,742
Other cash and cash equivalents
9,916
4,633
Total cash and cash equivalents
18
27,721
21,375
Total current assets
38,445
40,494
Total assets
63,144
68,989
LIABILITIES
Current liabilities
Trade and other payables
19
(4,287)
(5,669)
Current tax liabilities
(175)
(627)
Other liabilities
20
(6,903)
(5,014)
Deferred income and JetCard deposits
(21,423)
(24,658)
Derivative financial instruments
24
—
(39)
Lease liabilities
21
(4,809)
(5,448)
Deferred consideration
22
—
(1,318)
Provisions
23
(735)
(469)
Total current liabilities
(38,332)
(43,242)
Net current assets/(liabilities)
113
(2,748)
Non-current liabilities
Borrowings
18
—
(11,500)
Lease liabilities
21
(1,060)
(1,860)
Deferred consideration
22
(991)
(982)
Deferred tax liability
26
(1,511)
(1,819)
Provisions
23
(168)
(393)
Total non-current liabilities
(3,730)
(16,554)
Total liabilities
(42,062)
(59,796)
Net assets
21,082
9,193
116
Air Partner plc | Annual Report 2021
Financial statements
31 January
31 January
2021
2020
Note
£’000
£’000
EQUITY
Share capital
28
636
535
Share premium account
29
5,951
5,895
Merger reserve
30
295
295
Own shares reserve
31
(67)
(158)
Translation reserve
(82)
661
Retained earnings
14,349
1,965
Total equity
21,082
9,193
These financial statements on pages 113 to 169 were approved and authorised for issue by the Board of Directors on
11 May 2021 and were signed on its behalf by:
M A Briffa
J E Estell
Director
Director
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
Consolidated statement of financial position continued
117
Air Partner plc | Annual Report 2021
Financial statements
Company statement of financial position
as at 31 January 2021
31 January
31 January
2021
2020
Note
£’000
£’000
ASSETS
Non-current assets
Intangible assets
14
878
1,095
Property, plant and equipment
15
767
1,452
Investments
16
22,327
22,215
Deferred tax assets
26
42
—
Total non-current assets
24,014
24,762
Current assets
Trade and other receivables
17
10,321
12,505
JetCard bank balances
11,611
11,717
Other cash and cash equivalents
5,751
411
Total cash and cash equivalents
18
17,362
12,128
Total current assets
27,683
24,633
Total assets
51,697
49,395
LIABILITIES
Current liabilities
Trade and other payables
19
(1,300)
(1,899)
Current tax liabilities
(15)
(290)
Other liabilities
20
(8,853)
(6,572)
Deferred income and JetCard deposits
(12,643)
(13,338)
Derivative financial instruments
24
—
(39)
Lease liabilities
21
(346)
(627)
Deferred consideration
22
—
(1,318)
Provisions
23
(223)
(24)
Total current liabilities
(23,380)
(24,107)
Net current assets
4,303
526
Non-current liabilities
Borrowings
18
—
(11,500)
Lease liabilities
21
(309)
(644)
Deferred consideration
22
(991)
(982)
Deferred tax liability
26
—
(38)
Provisions
23
—
(200)
Total non-current liabilities
(1,300)
(13,364)
Total liabilities
(24,680)
(37,471)
Net assets
27,017
11,924
118
Air Partner plc | Annual Report 2021
Financial statements
31 January
31 January
2021
2020
Note
£’000
£’000
EQUITY
Share capital
28
636
535
Share premium account
29
5,951
5,895
Merger reserve
30
295
295
Own shares reserve
31
(67)
(158)
Retained earnings
20,202
5,357
Total equity
27,017
11,924
The parent company profit after tax for the financial year was £8,093,000 (2020: £1,974,000).
These financial statements on pages 113 to 169 were approved and authorised for issue by the Board of Directors on
11 May 2021 and were signed on its behalf by:
M A Briffa
J E Estell
Director
Director
Air Partner plc Registered no. 00980675
The above Company statement of financial position should be read in conjunction with the accompanying notes.
Company statement of financial position continued
119
Air Partner plc | Annual Report 2021
Financial statements
Consolidated and Company statement of cash flows
for the year ended 31 January 2021
Group
Company
Year
Year
Year
Year
ended
ended
ended
ended
31 January
31 January
31 January
31 January
2021
2020
2021
2020
Note
£’000
£’000
£’000
£’000
Cash generated from operations
33
19,416
9,109
13,394
4,529
– Interest received
29
71
2
3
– Interest paid
(512)
(578)
(309)
(328)
Income tax paid
(4,653)
(898)
(1,323)
(434)
Net cash inflow from operating activities
14,280
7,704
11,764
3,770
Investing activities
– Purchases of property, plant and equipment
15
(337)
(549)
(9)
(143)
– Purchases of intangible assets
14
(231)
(376)
(177)
(354)
– Proceeds on disposal of PPE
21
—
21
—
– Acquisition of subsidiaries
32
(1,278)
(7,446)
(1,278)
(8,868)
Net cash used in investing activities
(1,825)
(8,371)
(1,443)
(9,365)
Financing activities
– Dividends paid to the Company’s shareholders
(508)
(2,961)
(508)
(2,961)
– Proceeds on issue of new shares
7,052
—
7,052
—
– Proceeds on exercise of share options
5
22
5
22
– Repayment of finance lease liabilities
(1,617)
(5,414)
(691)
(667)
– (Decrease)/increase in borrowings
(11,500)
6,000
(11,500)
6,000
Net cash (used in)/generated from financing activities
(6,568)
(2,353)
(5,642)
2,394
Net increase/(decrease) in cash and cash equivalents
5,887
(3,020)
4,679
(3,201)
Opening cash and cash equivalents
21,375
25,154
12,128
15,736
Effect of changes in foreign exchange rates
459
(759)
555
(407)
Closing cash and cash equivalents
27,721
21,375
17,362
12,128
JetCard cash
The closing cash and cash equivalents balance can be further analysed into ‘JetCard cash’ and ‘non-JetCard cash’
as follows:
Group
Company
2021
2020
2021
2020
£’000
£’000
£’000
£’000
JetCard cash (see explanation below)
17,805
16,742
11,611
11,717
Non-JetCard cash
9,916
4,633
5,751
411
Cash and cash equivalents
27,721
21,375
17,362
12,128
JetCard cash is included in the cash flow as it does not meet the IFRS definition of restricted cash. JetCard cash is
cash received from customers participating in the JetCard programme in advance of bookings being made. It is
managed through segregated bank accounts set aside for these purposes and is not used for Air Partner’s working
capital needs.
The above consolidated and Company statements of cash flows should be read in conjunction with the accompanying notes.
120
Air Partner plc | Annual Report 2021
Financial statements
Notes to the financial statements
for the year ended 31 January 2021
1 General information
Air Partner plc (the 'Company') is a public listed company limited by shares which is listed on the London Stock
Exchange and incorporated and domiciled in the UK (England) under registration number 00980675. The address
of the registered office is 2 City Place, Beehive Ring Road, Gatwick, West Sussex RH6 0PA. The nature of the Group’s
operations and its principal activities are set out in the Strategic report on pages 1 to 60.
2 Accounting policies
a) Basis of preparation of financial statements
The accounting policies adopted are consistent with those of the previous financial year, except as described in the
following sections.
The consolidated financial statements and Company financial statements have been prepared in accordance with
international accounting standards in conformity with the requirements of the Companies Act 2006 (International
Financial Reporting Standards – ‘IFRS’) and the applicable legal requirements of the Companies Act 2006. In addition
to complying with international accounting standards in conformity with the requirements of the Companies Act 2006
as applicable to companies using IFRS, the consolidated financial statements also comply with International Financial
Reporting Standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union.
The financial statements have been prepared on a historical cost basis, except for the revaluation of certain financial
instruments which are stated at fair value, and are presented in Sterling, being the currency of the primary economic
environment in which the Group operates. Unless otherwise stated, figures are rounded to the nearest thousand.
The Company’s UK subsidiaries listed below are exempt from the requirements to audit their accounts under section
479A of the Companies Act 2006:
‣ Air Partner Aviation Services Limited, company number 03874833
‣ Air Partner CHS Limited, company number 06671502
‣ Air Partner Consulting Limited, company number 02070950
‣ Air Partner Travel Management Company Limited, company number 03767092
‣ Clockwork Research Limited, company number 05477740
‣ Redline Worldwide Limited, company number 09510974
Under section 479A of the Companies Act 2006, Air Partner plc, being the parent undertaking of these entities, has
given a statutory guarantee of all the outstanding liabilities to which the companies are subject to as at 31 January 2021.
UK-adopted international accounting standards
On 31 December 2020 EU-adopted IFRS was brought into UK law and became UK-adopted international
accounting standards, with future changes to IFRS being subject to endorsement by the UK Endorsement Board.
The consolidated financial statements will transition to UK-adopted international accounting standards for financial
periods beginning 1 January 2021.
Adoption of new and revised standards
The following new and revised standards and interpretations have been adopted in the current year.
‣ IAS 1 Presentation of Financial Statements
‣ IAS 8 Accounting Policies
‣ Definition of a Business – amendments to IFRS 3
‣ Interest Rate Benchmark Reform – amendments to IFRS 9, IAS 39 and IFRS 7
‣ References to the Conceptual Framework in IFRS Standards
The amendments listed above did not have any impact on the amounts recognised in prior periods and are not
expected to significantly affect the current or future periods.
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Financial statements
Notes to the financial statements continued
for the year ended 31 January 2021
2 Accounting policies continued
a) Basis of preparation of financial statements continued
New standards, amendments and interpretations in issue but not yet effective
The IASB and IFRS Interpretations Committee have issued the following standards and interpretations with an
effective date of implementation for accounting periods beginning after the date on which the Group’s financial
statements for the current year commenced.
Effective after 31 January 2021
Effective for accounting periods beginning on or after
New standards
IFRS 17 Insurance Contracts
1 January 2021
Effective for accounting periods beginning on or after
Amendments
Annual Improvements to IFRS Standards 2018–2020 Cycle
1 January 2022
COVID-19-Related Rent Concessions – amendments to IFRS 16
1 June 2020
IFRS 17 is not applicable to the Group, as it does not issue insurance or investment contracts.
There are no standards and interpretations in issue but not yet adopted which, in the opinion of the Directors, will have
a material effect on the reported income or net assets of the Group or Company.
The Directors are satisfied that climate change does not have a material impact on either individual assets or
cash‑generating units in the financial statements.
b) Basis of consolidation
Subsidiaries are all entities (including structured entities) over which the Group has control.
The Group controls an entity where the Group is exposed to, or has rights to, variable returns from its involvement with
the entity and has the ability to affect those returns from its involvement with the entity and has the ability to affect
those returns through its power to direct the activities of the entity.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated
from the date that control ceases.
The acquisition method of accounting is used to account for business combinations by the Group.
Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies
used into line with those used by the Group. All intra-group transactions, balances, income and expenses are
eliminated on consolidation.
c) Going concern
The Group’s business activities, together with the factors likely to affect its future development, performance and position,
are set out in the Strategic report on pages 1 to 60. The financial position of the Group, its cash flows, liquidity position
and borrowing facilities are described in the Strategic report on pages 1 to 60. In addition, note 24 – Financial instruments
in the financial statements includes the Group’s objectives, policies and processes for managing its capital risk; details
of its financial instruments and hedging activities; and its exposures to interest rate risk, credit risk, liquidity risk and
foreign currency risk.
COVID-19 has increased uncertainty surrounding the future trading environment for the Group. Accordingly, the
Directors have undertaken a thorough assessment in evaluating Going concern as detailed in the Going Concern and
viability statement on pages 49 and 50.
The Directors took steps during the year to equip the Group to deal with the economic impact of the COVID-19 pandemic.
These included reviewing credit terms, cost cutting measures and utilising government support for staff costs where
appropriate. The Directors believe the steps detailed above and the strong cash position at the end of April 2021 mean
the Group is well placed to manage its business and meet its liabilities as they fall due. In reaching this conclusion, the
Directors have taken into account the risks identified in the Principal risks and uncertainties on pages 40 to 48.
The Directors have a reasonable expectation that the Group has adequate resources to continue in operational
existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing
the annual financial statements.
Financial statements
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2 Accounting policies continued
d) Foreign currency
i) Functional and presentational currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the
primary economic environment in which the entity operates (the functional currency). The consolidated financial
statements are presented in GB Pounds (£), which is Air Partner plc’s functional and presentation currency.
ii) Foreign currency transactions
Transactions in foreign currencies are translated at the foreign exchange rate prevailing at the time of the transaction.
Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to the functional
currency of the entity at the foreign exchange rate ruling at that date. Foreign exchange differences arising on translation
are recognised in the income statement. Non-monetary assets and liabilities that are measured in terms of historical
cost in a foreign currency are translated using the exchange rate at the date of the transaction.
iii) Translation of foreign operations in Group consolidated financial statements
The assets and liabilities of foreign operations are translated at exchange rates prevailing at the reporting date. Income
and expenses are translated at the average rate for the period. Exchange differences arising are classified as equity
and transferred to the Group’s translation reserve.
e) Goodwill
Goodwill arising in a business combination is recognised as an asset at the date that control is acquired (the acquisition
date). Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling
interest in the acquiree and the fair value of the acquirer’s previously held equity interest (if any) in the entity over the
net of the acquisition date amounts of the identifiable assets acquired and the liabilities assumed.
Goodwill denominated in currencies other than Sterling is revalued at the rate of exchange ruling at the statement
of financial position date.
If, after reassessment, the Group’s interest in the fair value of the acquiree’s identifiable net assets exceeds the sum
of the consideration transferred, the amount of any non-controlling interest in the acquiree and the fair value of the
acquirer’s previously held equity interest in the acquiree (if any), the excess is recognised immediately in the income
statement as a bargain purchase gain.
Goodwill is not amortised but is reviewed for impairment annually, or more frequently when there is an indication
that the unit may be impaired. For the purpose of impairment testing, goodwill is allocated to each of the Group’s
cash‑generating units expected to benefit from the synergies of the combination. If the recoverable amount of the
cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the
carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis
of the carrying amount of each asset in the unit. An impairment loss recognised for goodwill is not reversed in a
subsequent period.
On disposal of a subsidiary the attributable amount of goodwill is included in the determination of the profit or loss
on disposal.
f) Intangible assets
Internally generated assets
Internally generated intangible assets developed by the Group are recognised only if all of the following conditions are met:
‣ an asset is created that can be identified;
‣ management intends to complete the asset and use or sell it;
‣ it is probable that the asset created will generate future economic benefits; and
‣ the development cost of the asset can be measured reliably.
Amortisation is charged to the income statement so as to write off the cost of assets less their residual values over
their estimated useful lives. The carrying value of intangible assets with a finite life is reviewed for impairment
whenever events or changes in circumstances indicate that the carrying value may not be recoverable.
Financial statements
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Notes to the financial statements continued
for the year ended 31 January 2021
2 Accounting policies continued
f) Intangible assets continued
Other intangible assets
Intangible assets arising on acquisition are stated at fair value less accumulated amortisation and any impairment
losses. Amortisation of the carrying value of intangible assets arising on acquisition is charged to the income
statement over the estimated useful life, which is as follows:
Brands
10%–50% per annum on a straight-line basis
Mandates/order book
over the life of the mandate
Customer contracts
over the life of the contract
Customer relationships
5%–33.3% per annum on a straight-line basis
Training materials
10% per annum on a straight-line basis
Software asset
20%–33.3% per annum on a straight-line basis
Right of use assets
over the life of the lease
The carrying value of intangible assets with a finite life is reviewed for impairment whenever events or changes in
circumstances indicate that the carrying value may not be recoverable. Similarly, the remaining useful life of intangible
assets are reviewed and if any of those need to be shortened due to events or changes in circumstances then the
amortisation charge is correspondingly increased to reflect the shorter life.
g) Property, plant and equipment
Items of property, plant and equipment are stated at cost less accumulated depreciation and any impairment losses.
Depreciation is charged to the income statement so as to write off the cost of assets less their residual values over
their estimated useful lives, as follows:
Short leasehold property
over the life of the lease on a straight-line basis
Leasehold improvements
over the life of the lease on a straight-line basis
Fixtures and equipment
10%–33% per annum on a straight-line basis
Motor vehicles
25% reducing balance and 20%–33% per annum on a straight-line basis
Right of use assets
over the life of the lease
h) Impairment of tangible and intangible assets excluding goodwill
At each statement of financial position date, the Group reviews the carrying amounts of its tangible and intangible
assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such
indication exists, the recoverable amount of the asset is estimated to determine the extent of the impairment loss (if any).
Where the asset does not generate cash flows that are independent from other assets, the Group estimates the
recoverable amount of the cash-generating unit to which the asset belongs. An intangible asset with an indefinite
useful life is tested for impairment at least annually and whenever there is an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the
estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks specific to the asset for which the estimates of future
cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the
carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is
recognised immediately in the income statement, unless the relevant asset is carried at a revalued amount, in which
case the impairment loss is treated as a revaluation decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is
increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not
exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset
(or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in the income
statement, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment
loss is treated as a revaluation increase.
Financial statements
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2 Accounting policies continued
i) Financial instruments
Financial assets
The Group classifies its financial assets in the following categories: at fair value through profit or loss, or at amortised
cost. The classification depends on the purpose for which the financial assets were acquired. Management determines
the classification of its financial assets at initial recognition.
Purchases and sales of financial assets are recognised on the trade date – the date on which the Group commits
to purchase or sell the asset. Financial assets are initially recognised at fair value plus transaction costs, except for
financial assets held at fair value through profit or loss, which are initially recognised at fair value, and transaction
costs are expensed in the income statement. Financial assets are derecognised when the rights to receive cash flows
have expired or have been transferred and the Group has transferred substantially all risks and rewards of ownership.
Financial assets at fair value through profit or loss
A financial asset is classified in this category if acquired principally for the purpose of selling in the short term.
Derivatives are also categorised as fair value through profit and loss unless they are designated as hedges. Assets
in this category are classified as current assets if they are expected to be settled within 12 months; otherwise, they
are classified as non-current. Financial assets at fair value through profit or loss are initially recognised at fair value
at the date the contract is entered into, and subsequently gains or losses arising from changes in their fair value are
presented in the income statement within administrative expenses in the period in which they arise. The Group’s
financial assets at fair value through profit or loss comprise derivative financial instruments.
Derivative financial instruments
From time to time the Group enters into derivative financial instruments, including foreign exchange forward
contracts, to manage its exposure to foreign exchange rate risk. Derivatives not designated into an effective hedge
relationship are classified as a financial asset or a financial liability. The Group has not designated any derivatives as
hedging items and therefore does not apply hedge accounting.
Trade and other receivables and accrued income
Trade and other receivables and accrued income are non-derivative financial assets with fixed or determinable
payments that are not quoted in an active market. They are included in current assets, except for maturities greater
than 12 months at the end of the reporting period. These are classified as non-current assets. Trade and other
receivables and accrued income are subsequently carried at amortised cost using the effective interest method.
Trade receivables
Trade receivables are amounts due from customers and suppliers for services performed in the ordinary course of
business. If collection is expected in one year or less, they are classified as current assets. If not, they are presented
as non-current assets.
Provision for impairment of trade receivables has been made using an expected credit loss model in addition to any
further specific provisions which are assessed on an individual receivable basis. Please refer to note 17 – Trade and
other receivables for further details.
Other receivables
Other receivables are other amounts contractually due from third parties, for example deposits receivable for leased assets.
Accrued income
Accrued income is revenue that has been contracted and recognised in accordance with the Group’s accounting
policies, but not yet invoiced.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits with an original maturity of three months or less.
The carrying amount of these assets approximates their fair value.
The Group holds cash deposits as part of its JetCard programme. These deposits can be utilised by the customer at
any time. The full policy for the treatment of these balances is set out in note 2t – JetCard programme.
Financial statements
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Notes to the financial statements continued
for the year ended 31 January 2021
2 Accounting policies continued
i) Financial instruments continued
Financial liabilities
The Group classifies its financial liabilities in the following categories: at fair value through profit or loss and at amortised
cost. The classification depends on the purpose for which the financial liabilities were acquired. Management determines
the classification of its financial liabilities at initial recognition. Financial liabilities are recognised when the Group becomes
a party to the contractual agreement of the instrument.
Financial liabilities at fair value through profit or loss
A financial liability is classified in this category if acquired principally for the purpose of selling in the short term.
Derivatives are also categorised as fair value through profit and loss unless they are designated as hedges. Liabilities
in this category are classified as current liabilities if they are expected to be settled within 12 months; otherwise, they
are classified as non-current. Financial liabilities at fair value through profit or loss are initially recognised at fair value
at the date the contract is entered into, and subsequently gains or losses arising from changes in their fair value are
presented in the income statement within administrative expenses in the period in which they arise. The Group’s
financial liabilities at fair value through profit or loss comprise derivative financial instruments.
Financial liabilities at amortised cost
The Group’s financial liabilities at amortised cost comprise trade payables, other payables, accrued costs and
borrowings. They are initially measured at fair value, net of transaction costs, and are subsequently measured at
amortised cost using the effective interest method. JetCard deposits are included within financial liabilities as they
are contractually repayable upon demand.
Trade payables
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business
from suppliers and customers. Trade payables are classified as current liabilities if payment is due within one year or
less. If not, they are presented as non-current liabilities.
Other payables
Other payables that are financial liabilities at amortised cost are certain customer deposits which are contractually
refundable to customers on demand.
Accrued costs
Accrued costs are costs that have been contracted and recognised in accordance with the Group’s accounting policies,
but for which invoices have not yet been received or payments made, as applicable.
Borrowings
Borrowings consist of an interest-bearing bank facility, which is recorded at amortised cost. Issue costs are amortised
over the life of the loan.
Offsetting financial instruments
Financial assets and liabilities are offset and the net amount reported in the statement of financial position when
there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis
or realise the asset and settle the liability simultaneously.
Equity instruments issued by the Group
An equity instrument is a contract that evidences a residual interest in the asset of an entity after deducting all of its
liabilities. Equity instruments are recorded at the proceeds received, net of direct issue costs. The Group’s equity
instruments comprise share capital in the statement of financial position.
j) Provisions
Provisions are recognised when the Group has a present obligation as a result of a past event and it is probable that the
Group will be required to settle that obligation. Provisions are measured at the Directors’ best estimate of the expenditure
required to settle the obligation at the reporting date and are discounted to present value.
A restructuring provision is recognised when the Group has developed a detailed formal plan for the restructuring and
has raised a valid expectation in those affected that it will carry out the restructuring by starting to implement the plan
or announcing its main features to those affected by it.
Financial statements
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2 Accounting policies continued
k) Revenue
Revenues are derived from aircraft chartering services, aircraft remarketing services, aircraft inspection services
and the provision of aviation-related training and safety and security consulting services. In line with IFRS 15 Revenue
from Contracts with Customers, where a contract has been determined as principal, the full amount of the invoice is
recognised as revenue. Where Air Partner is not acting as principal, revenue is recognised on an agency basis and only
gross profit, being the difference between the amount invoiced to the customer and the third-party costs incurred, is
reported as revenue. Revenue is measured as the transaction price receivable for the provision of goods and services
to third-party customers and is stated exclusive of value added tax and is only recognised when control has passed
to the customer.
The different revenue streams are listed below and the segments the revenue will be included in as shown in note 4
– Segmental analysis.
Aircraft chartering services – Group Charter, Private Jets and Freight
Amounts receivable in respect of aircraft chartering services are recognised as revenue when the economic benefits
are deemed to have passed to the customer, which is generally the flight date. This applies equally whether or not the
customer is in the JetCard programme. In instances where the Group is acting as agent, the net amount receivable by
the Group is recognised as revenue. The determination as to whether Air Partner is considered principal or agent in
a contract depends on whether or not Air Partner is contractually obliged under the terms of the contract to provide
the particular service.
Aircraft remarketing services – Group Charter
Air Partner Remarketing’s (formerly Cabot Aviation Services Limited) principal activity is that of an aircraft remarketing
broker. Fees earned in respect of these services are either recognised when legal title to the aircraft has passed to the
customer or for termination of contract fees that the Group has a reasonable expectation to recover, based on work
completed to date and the progress of the sale.
Aircraft inspection services – Safety & Security
Aircraft registered with the Isle of Man Aircraft Registry, which is managed by Baines Simmons Limited, require an
annual inspection. Amounts receivable in respect of such inspections are recognised as revenue once the aircraft has
been inspected.
Provision of aviation-related training and safety consulting services – Safety & Security
Baines Simmons Limited, Redline Aviation Security Limited, Clockwork Research Limited, SafeSkys Limited and
Air Partner CHS Limited provide various aviation-related specialist training and consultancy services. Revenue is
recognised by reference to the delivery of the services. Amounts in respect of unbilled services provided to customers
are recognised as revenue at the statement of financial position date.
l) Government grants
Grants from the government are recognised at their fair value where there is a reasonable assurance that the grant will
be received and the Group will comply with all attached conditions. Grant income has been offset against the relevant
expenditure where permitted.
Further information on the grants received during the year is provided in note 35 – Government grants.
m) Segmental reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating
decision maker. The chief operating decision maker, which is responsible for resource allocation and assessing
performance of the operating segments, is considered to be the Board. The nature of the operating segments is
set out in note 4 – Segmental analysis.
Financial statements
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Notes to the financial statements continued
for the year ended 31 January 2021
2 Accounting policies continued
n) Share based payments
From time to time the Group will grant options to employees to subscribe for ordinary shares in the Company.
The fair value of options granted is recognised as an employee benefits expense, with a corresponding increase
in equity. The total amount to be expensed is determined by reference to:
‣ the fair value of the option and grant date using an appropriate valuation model method;
‣ management's estimate of the likelihood that the non-market performance conditions will be achieved; and
‣ the impact of any non-vesting conditions (e.g. an employee leaving before the vesting period is finished).
The total expense is recognised over the vesting period in the income statement, which is the period over which all of
the specified vesting conditions are to be satisfied. A credit is recorded within equity which corresponds to the income
statement charge in each period. At the end of each period, the entity revises its estimates of the number of options
that are expected to vest based on the non-market vesting and service conditions. It recognises the impact of the
revision to original estimates, if any, in the income statement, with a corresponding adjustment to equity.
o) Retirement benefit costs
Payments to defined contribution retirement benefit schemes are charged as an expense in the period in which the
employees render service. Payments made to state-managed retirement benefit schemes are dealt with as payments
to defined contribution schemes where the Group’s obligations under the schemes are equivalent to those arising in
a defined contribution retirement benefit scheme.
Air Partner International S.A.S. operates a defined benefit pension scheme and the liability of the scheme is recognised
in the statement of financial position at the present value of the obligation at the statement of financial position date.
The obligation is calculated annually by independent actuaries and actuarial gains and losses arising from experience
adjustments and changes in assumptions are recognised in full in the period in which they occur.
p) Taxation
The tax expense represents current and deferred tax. Tax is recognised in the income statement except to the extent
that it relates to items recognised directly in equity, in which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively
enacted at the reporting date, and any adjustments to the tax payable in respect of previous years.
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amount of assets
and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit and
is accounted for using the statement of financial position liability method. Deferred tax liabilities are recognised for all
temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will
be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised
if the temporary differences arise from goodwill or from the initial recognition (other than in a business combination)
of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.
Deferred tax is calculated at the tax rates that are enacted or substantively enacted at the reporting date.
q) Leasing
Payments associated with short-term leases and low value assets are recognised on a straight-line basis as an expense
in the consolidated statement of comprehensive income. Short-term leases are leases with a lease term of 12 months
or less. Low value leases are those where the underlying asset value, when new, is £5,000 or less. See note 34 –
Short‑term and low value lease commitments.
For all other leases where the Group is the lessee, at the lease’s inception a right of use asset at the fair value of the
leased asset or, if lower, the present value of the minimum lease payments is recognised. The corresponding liability,
net of finance charges, is included in other short-term and long-term payables. The liability includes the net present
value of the following:
‣ fixed payments, less any lease incentives receivable;
‣ variable lease payments that depend on an index or a rate, initially measured using the index or rate as at the
commencement date;
‣ the exercise price of a purchase option if the Group is reasonably certain to exercise that option;
‣ payments of penalties for terminating the lease, if the lease term reflects the Group exercising that option; and
‣ amounts expected to be payable by the Group under residual value guarantees.
Financial statements
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2 Accounting policies continued
q) Leasing continued
Each lease payment is allocated between the liability and finance cost. The finance cost is charged to the income
statement over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the
liability for each period. The right of use asset acquired is depreciated over the asset’s useful life, or over the shorter of
the asset’s useful life and the lease term if there is no reasonable certainty that the Group will obtain ownership at the
end of the lease term.
Judgements made in calculating the lease liability include assessing whether arrangements contain a lease and
determining the lease term. Lease terms are negotiated on an individual basis and contain a wide range of different
terms and conditions. Property leases will often include an early termination or extension option to the lease term.
Extension and termination options have been considered when determining the lease term, along with all facts and
circumstances that may create an economic incentive to exercise an extension option, or not exercise a termination
option. Extension periods (or periods after termination options) are only included in the lease term if the lease is
reasonably certain to be extended (or not terminated).
The lease payments are discounted using an incremental borrowing rate. Calculating the discount rate is an estimate
made in calculating the lease liability. The rate used is the rate that the Group would have to pay to borrow the funds
necessary to obtain an asset of similar value to the right of use asset in a similar economic environment with similar
terms, security and conditions. To determine the incremental borrowing rate, the Group uses the average borrowing
cost available for the Group at the date of addition.
r) Dividends
Final dividends on ordinary shares are recognised as a liability in the period in which the dividends are approved by
the Company’s shareholders. Dividends are recognised as a liability in the period in which they are approved.
s) Deferred income
Deferred income is comprised of amounts received or receivable from customers in respect of which services are yet
to be provided or flights that are yet to occur.
For contracts where the Group is the principal, the full amount of deferred revenue will be recognised within revenue
upon performance of services. For contracts where the Group is acting as agent, the amount of future revenue to be
recognised will be purely the Group’s agency commission element of these amounts.
In the charter business the Group generally invoices its customers in advance of the flight date. The value of these
invoices is taken to deferred income and is only released to the income statement when the revenue is recognised at
the time of the flight date on an invoice by invoice basis.
However, IFRS 15 requires, in cases where trade receivables are matched by deferred consideration, i.e. the flight has
not yet taken place and the payment is not yet contractually due, that neither of those amounts is recognised in the
statement of financial position. Therefore deferred income under IFRS 15 relates only to contracts where the Group
has raised an invoice(s) to the customer and been paid for the same by the date of the statement of financial position.
t) JetCard programme
The JetCard programme is one where the customer purchases a JetCard in advance for their future flight
requirements. The JetCard balance changes over time as the customer uses that balance for flights or replenishes it.
The Group manages its JetCard cash balances through segregated bank accounts and it only uses this cash to satisfy
JetCard orders not for its own working capital purposes, and for this reason JetCard cash is separately disclosed in the
statement of financial position. The JetCard cash balances are assets of the Company, are included in the financial
statements and are matched by equal JetCard deposit liabilities so the impact on net assets is nil.
Periodic reviews of the JetCard cash balances are performed to identify dormant or unutilised customer balances.
A customer balance that has not had any activity within the last four years, be this usage (flights), cash top-up or
refund, is followed up with the customer to understand the reason for the lack of activity. This follow-up would include
seeking permission to return the funds and if this approval is not received after several attempts, and is fully evidenced
and approved by the Head of Private Jets, the balance will then be recognised in the consolidated income statement.
Full records of the historical balances are maintained and reconciled on a monthly basis.
The timing of revenue recognition is the same for flights chartered through the JetCard programme as that for
other flights.
Financial statements
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Notes to the financial statements continued
for the year ended 31 January 2021
2 Accounting policies continued
u) Gross profit
In the charter business segments, the gross profit relating to a flight is calculated as being its charter price less all
the direct costs associated with its fulfilment. It does not include the cost of Air Partner staff nor overheads.
In the Safety & Security business segment, gross profit is calculated as being the price of a contract less all the direct
costs associated with delivering that contract including the costs of staff and contractors directly engaged in delivering
the contracted service. It does not include the cost of other general Air Partner staff nor overheads.
v) Other non-GAAP measures
Gross transaction value (GTV) represents the total value invoiced to the customer and is stated exclusive of value
added tax.
Operating profit before exceptional and other items and profit before tax before exceptional and other items are
disclosed in order to present what the Directors consider the underlying performance of the Group.
The Directors believe that the underlying profit and earnings per share measures provide additional useful information
for shareholders on the underlying trading performance of the business. These measures are consistent with how underlying
business performance is measured internally and these are referred to in the Annual Report. The underlying profit before
tax measure is not a recognised profit measure under IFRS and may not be directly comparable with adjusted profit
measures used by other companies. The adjustments made to reported profit before tax are to exclude the following:
‣ significant restructuring costs;
‣ significant and one-off impairment charges, non-recurring income and movements in provisions that distort
underlying trading;
‣ costs relating to strategy changes that are not considered normal operating costs of the underlying business;
‣ acquisition related items, including acquisition costs and subsequent adjustments to deferred or contingent
considerations recognised in the income statement;
‣ amortisation of intangible assets recognised on acquisition; and
‣ acquisition consideration classified as an employee cost under IFRS 3 Business Combinations.
w) Critical accounting judgements and sources of estimation uncertainty
The preparation of financial statements requires management to make estimates and assumptions that affect the
application of policies and reported amounts of assets and liabilities, income and expenses. These estimates and
associated assumptions are based on historical experience and various other factors believed to be reasonable under
the circumstances. Actual results could differ from these estimates. These underlying assumptions are reviewed on an
ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the
revision affects only that period, or in the period of the revision and future periods if these are also affected.
Management also needs to exercise judgement in applying the Group’s accounting policies.
Critical judgements in applying the Group’s accounting policies
The following are the critical judgements, apart from those involving estimations (which are dealt with separately
below), that the Directors have made in the process of applying the Group’s accounting policies and that have the
most significant effect on the amounts recognised in financial statements.
Revenue recognition
One of the key judgements in relation to revenue recognition is the judgement of whether the Group is acting as
principal or agent in transactions with customers in its charter business. In making its judgement, management considers
the detailed terms of sales transactions with customers in order to determine whether the Group is performing as the
principal obligor. This assessment determines how revenue is recognised as either principal or agent in accordance with
IFRS 15. Note 4 – Segmental analysis, gives a comparison of gross transaction value and revenue by revenue stream.
Exceptional item classification
Operating profit before exceptional and other items and profit before tax before exceptional and other items are
disclosed in order to present what the Directors consider the underlying performance of the Group. The Directors
exercise judgement over which costs are considered to be exceptional or other items and these are detailed in note 7
– Exceptional and other items. The Directors review all items included within this note to ensure they are in line with
the policy set out in note 2v – Other non-GAAP measures. If these costs were not considered to be exceptional they
would have a material impact and distort the underlying results of the Group.
Financial statements
130
Air Partner plc | Annual Report 2021
2 Accounting policies continued
w) Critical accounting judgements and sources of estimation uncertainty continued
Key sources of estimation uncertainty
The key assumptions concerning the future, and other key sources of estimation uncertainty at the reporting date, that
may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the
next financial year are as noted below.
Weighted average cost of capital calculation
The Group’s weighted average cost of capital (WACC) is used as the discount rate in calculating the present value of
expected future cash flows in models for valuing intangible assets acquired on acquisition and impairment testing.
WACC is reassessed at the end of each financial year.
The WACC is calculated as weighted average of the cost of equity and the cost of debt. The weighting is based on the
market value of debt and equity at the balance sheet date. The cost of debt is based on the average rate on the Group’s
bank borrowing throughout the year. The cost of equity is based on market information supplied by the Group’s brokers
to assess expected risk and compared to similar listed companies on the market.
The Group has used a WACC of 8.65% (2020: 8.65%) for the current year. The potential impact of an increase in WACC
is shown as part of the impairment assessment of goodwill (note 13).
Acquisition accounting – Redline customer relationships and deferred consideration
Details of the acquisition of Redline Worldwide Limited (Redline) are included in note 32 – Prior year acquisition of
subsidiaries. The values were impacted by the WACC discount figure used in determining the net present value of the
cash flows relating to the intangible used. Assumptions, including WACC, relating to the consideration payable on
acquisition are detailed in the acquisition note and are not considered to be material.
Customer relationships relied on additional assumptions to determine the forecast return. Management has not
identified any material change to the assumptions used in the prior year accounts, indication of impairment of assets
acquired on acquisition or any previously unidentified liabilities. As a result there has been no restatement of the
acquisition accounting.
The acquisition consideration included £2.0m of deferred consideration. £1.0m of unconditional deferred consideration
was paid on the first anniversary of the acquisition while the remaining £1.0m is conditional based on a number of
performance conditions. Management has undertaken an assessment of the likelihood of the second tranche crystallising
and at this junction has retained the provision at the full £1.0m. The judgement reflects the level of uncertainty in the
aviation market as a result of COVID-19. The range of outcomes is dependent on the FY22 performance of Redline but
will not exceed the £1.0m liability held in the accounts.
Impairment
Impairment calculations for goodwill and investments compare the values held at year end for each cash-generating
unit (CGU) to the present value of discounted future cash flow. Cash flows are discounted at WACC (see above).
The cash flow includes assumptions for future performance. The models are driven by gross profit. Operating
expenses and tax are based on historical information; gross profit is considered to be the only material source of
uncertainty. The forecast revenue is based on historical performance, the forecast for the subsequent fiscal year and
the underlying strategy for that CGU. Forecasts beyond the subsequent fiscal year are conservative and assume
a growth rate in line with long-term economic forecasts.
No goodwill impairments have been booked during the year. Sensitivity analysis for the key assumptions is set out
in note 13 – Goodwill.
Financial statements
131
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
2 Accounting policies continued
w) Critical accounting judgements and sources of estimation uncertainty continued
Provision for outflows resulting from French tax investigation
Air Partner International S.A.S. has undergone a historical tax reassessment principally in relation to indirect taxes
following which the French Tax Administration has raised a challenge on some treatments and has issued a demand
for additional payment and fines. Air Partner International S.A.S. challenged a number of these demands and is
currently in communication with the French Tax Administration.
A provision of £283,000 was made in the previous financial year based on the most recent communication with the
French Tax Administration and external legal advice. The provision has been reassessed at year end and determined
only to require adjusting to reflect changes in foreign exchange rates to £298,000. Air Partner International S.A.S.
has provided a comprehensive response to the French Tax Administration and is awaiting further communication.
The provision remains management’s best estimate of the reassessment liability based on a thorough examination of
the points raised in the review and expert legal advice of tax matters in France. While the absolute range of outcomes
could be materially different from the provision, management believes the chance of a material variance is negligible
based on the most recent assessment.
Prior to the advent of COVID-19 it was expected the next stage of the inspection would be completed in summer 2020;
however, this has been delayed and final resolution of this matter is not expected for some time.
3 Revenue
An analysis of the Group’s revenue is as follows:
2021
2020
£’000
£’000
Sales of goods and services
71,173
66,664
No customer contributed more than 10% to the Group’s revenue in 2021 or 2020.
We have taken the practical expedient not to disclose the transaction price allocated to the remaining performance
obligations because either the expected duration is one year or less or the timing is at the customers' discretion.
Revenue recognised that was included in the contract liability balance at the beginning of the year was £8,288,000
(2020: £11,997,000).
4 Segmental analysis
The services provided by the Group consist of chartering different types of aircraft and related aviation services.
The Group has two divisions: Charter and Safety & Security. The Safety & Security division is viewed as one segment
by management. The Charter division's products and services and reviewed by management in three segments: Group
Charter, Private Jets and Freight. Air Partner Remarketing’s (formerly Cabot Aviation Services Limited) results are
aggregated into Group Charter. Overheads with the exception of corporate costs are allocated to the Group’s
segments in relation to operating activities.
Sales transactions between operating segments are carried out on an arm’s length basis. All results reviewed by the
Board (which is the chief operating decision maker) are prepared on a basis consistent with those that are reported in
the financial statements.
Financial statements
132
Air Partner plc | Annual Report 2021
4 Segmental analysis continued
The Board does not review assets and liabilities at segmental level; therefore these items are not disclosed.
The segmental information, as provided to the Board on a monthly basis, is as follows:
Year ended 31 January 2021
Group
Private
Safety
Corporate
Charter
Jets
Freight
& Security
costs
Total
Continuing operations
£’000
£’000
£’000
£’000
£’000
£’000
Gross transaction value
77,801
58,337
126,244
12,403
—
274,785
Revenue
27,332
18,570
12,868
12,403
—
71,173
Segmental gross profit
17,817
9,296
11,941
5,816
—
44,870
Administrative expenses, other operating income
and net impairment losses on financial assets
(11,437)
(7,883)
(5,274)
(5,830)
(2,414)
(32,838)
Depreciation and amortisation of non-acquired assets
(included within administrative expenses)1
(859)
(390)
(312)
(363)
—
(1,924)
Operating profit before exceptional and other items
6,380
1,413
6,667
(14)
(2,414)
12,032
Exceptional and other items (see note 7)
(332)
(249)
—
(2,629)
31
(3,179)
Segment profit/(loss)
6,048
1,164
6,667
(2,643)
(2,383)
8,853
Finance income
29
Finance expense
(503)
Profit before income tax
8,379
Income tax expense
(2,747)
Profit for the year
5,632
1 Depreciation of £0.5m relating to right of use assets and £0.1m relating to motor vehicles is included within gross profit.
Year ended 31 January 2020
Group
Private
Safety &
Corporate
Charter
Jets
Freight
Security
costs
Total
Continuing operations
£’000
£’000
£’000
£’000
£’000
£’000
Gross transaction value
136,979
69,808
19,813
10,216
—
236,816
Revenue
26,434
25,233
4,781
10,216
—
66,664
Segmental gross profit
14,724
11,672
3,158
4,604
—
34,158
Administrative expenses, other operating income
and net impairment losses on financial assets
(11,598)
(9,104)
(2,921)
(3,703)
(2,059)
(29,385)
Depreciation and amortisation of non-acquired assets
(included within administrative expenses)1
(1,168)
(253)
(68)
(137)
—
(1,626)
Operating profit before exceptional and other items
3,126
2,568
237
901
(2,059)
4,773
Exceptional and other items (see note 7)
(87)
34
—
(2,541)
(702)
(3,296)
Segment profit/(loss)
3,039
2,602
237
(1,640)
(2,761)
1,477
Finance income
71
Finance expense
(612)
Profit before income tax
936
Income tax expense
(633)
Profit for the year
303
1 Depreciation of £4.6m relating to right of use assets is included within gross profit.
The Company is domiciled in the UK but, due to the nature of the Group’s operations, a significant amount of gross profit
is derived from overseas countries. The Group reviews gross profit based upon the location of the business operations
used to generate that gross profit. Apart from the UK, no single country is deemed to have material non-current asset
levels other than there is goodwill in relation to the French operation of £987,000 (2020: £936,000) and right of use
assets in Italy of £3,705,000 (2020: £4,042,000).
Financial statements
133
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
4 Segmental analysis continued
The Board also reviews information on a geographical basis based on parts of the world in which it has business operations.
As a result the following additional information is provided showing a geographical split of the UK, Europe, the USA
and the Rest of the world based upon the location of the relevant business operation which contracts the business.
Rest of
UK
Europe
USA
the world
Total
Continuing operations
£’000
£’000
£’000
£’000
£’000
Year ended 31 January 2021
Gross transactional value
85,861
32,282
150,527
6,115
274,785
Revenue
40,189
8,188
21,310
1,486
71,173
Gross profit
20,198
5,341
17,845
1,486
44,870
Non-current assets (excluding deferred tax assets)
18,834
4,975
171
19
23,999
Year ended 31 January 2020
Gross transactional value
89,322
97,534
49,197
763
236,816
Revenue
34,880
18,837
12,774
173
66,664
Gross profit
17,427
8,732
7,826
173
34,158
Non-current assets (excluding deferred tax assets)
22,185
5,698
304
24
28,211
Europe can be further analysed as:
France
Germany
Italy
Other
Total
Continuing operations
£’000
£’000
£’000
£’000
£’000
Year ended 31 January 2021
Gross transactional value
1,634
20,973
7,047
2,628
32,282
Revenue
249
4,108
3,245
586
8,188
Gross profit
108
3,986
670
577
5,341
Year ended 31 January 2020
Gross transactional value
26,206
24,599
23,489
23,240
97,534
Revenue
2,123
9,192
4,330
3,192
18,837
Gross profit
1,994
4,091
1,416
1,231
8,732
5 Operating profit
Operating profit for the year has been arrived at after charging/(crediting) the following:
2021
2020
Continuing operations
£’000
£’000
Net foreign exchange loss
150
238
Change in the fair value of derivative financial instruments
(39)
31
Depreciation of property, plant and equipment
2,072
5,840
Impairment of property, plant and equipment
81
—
Profit on disposal of property, plant and equipment
(26)
—
Amortisation of intangible fixed assets – acquired
2,420
656
Amortisation of intangible fixed assets – other
421
334
Impairment of trade receivables
810
205
Operating lease rentals – land and buildings
61
213
Operating lease rentals – other
3
13
Staff costs (see note 8)1
29,381
23,030
Government grants relating to staff costs (see note 8 and note 35)1
(1,703)
—
Other operating income (see note 35)1
(43)
—
1 The Group received £1,746,000 of government grants during the year from schemes launched in response to the COVID-19
pandemic. See note 35 – Government grants for more information.
Financial statements
134
Air Partner plc | Annual Report 2021
5 Operating profit continued
Amortisation of intangible fixed assets – acquired, is included with exceptional and other items. Amortisation of
intangible fixed assets – other, is included within administrative expenses before exceptional and other items.
Other operating income is comprised of the following:
2021
2020
Continuing operations
£’000
£’000
Government grants (see note 35)
43
—
6 Auditors’ remuneration
2021
2020
£’000
£’000
The analysis of auditors’ remuneration is as follows:
Fees payable to the Company’s auditors and their associates for the audit of the parent company
and consolidated annual financial statements
218
209
Fees payable to the Company’s auditors and their associates for the audit of subsidiaries
pursuant to legislation (including that of countries and territories outside the UK)
72
95
Fees payable relating to overruns in previous years1
14
—
Total audit fees
304
304
2021
2020
£’000
£’000
Fees payable to the auditors and their associates for other services to the Group:
Audit related assurance services
45
40
Total non-audit fees
45
40
1 Overruns in previous years include additional fees of £30,000 for the audit of the parent company agreed after signing of the
financial statements for extra work required in relation to COVID-19, offset by savings of £16,000 resulting from the decision
following signing of the financial statements to not have the Company’s auditors audit one of the UK subsidiaries.
7 Exceptional and other items
The Group has identified a number of items which are material due to the significance of their nature and/or amount.
They are listed separately here to provide a better understanding of the financial performance of the Group.
2021
2020
£’000
£’000
Changes in Board and operating board composition1
—
(195)
Restructuring costs2
(783)
—
Amortisation of purchased intangibles3
(2,420)
(656)
Acquisition costs4
18
(604)
Disposal of subsidiary5
24
(4)
Costs incurred and provision for outflows resulting from French tax investigation6
—
(657)
Impairment of goodwill7
—
(1,885)
Settlement of historical legal disputes8
—
389
Adjustments to deferred consideration9
(18)
316
(3,179)
(3,296)
Tax effect of other items10
331
233
Exceptional and other items after taxation
(2,848)
(3,063)
1 Following the accounting review in FY19 the Directors undertook an internal review of the Group operating board and determined that
several roles were excess to requirements. The employees in these roles left during prior years and have not been replaced. The level of
Board changes and associated costs in these years were considered highly unusual and are not expected to recur in future periods.
Financial statements
135
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
7 Exceptional and other items continued
2 As a result of the negative impact of the COVID-19 pandemic on certain areas of the business the Directors undertook a review of
the business and identified savings through reductions in headcount where revenue was not forecast to recover for the foreseeable
future. Exceptional costs are comprised of the amounts paid, or due to be paid at year end, to employees as part of the redundancies,
including statutory redundancy, payment in lieu of notice and employer's National Insurance on these amounts and costs associated
with the closure of offices.
3 Please see note 14 – Other intangible assets for further detail regarding the amortisation of purchased intangibles.
4 The acquisition costs incurred in the prior year were in respect of the acquisition of Redline Worldwide Limited. The credit in the
current year reflects the release of a provision for expected costs related to deferred consideration on the acquisition. Please see
note 32 – Acquisition of subsidiaries for further details.
5 The Group disposed of Air Partner (Switzerland) AG during the current year and Air Partner Nordic during the prior year.
6 A provision of £283,000 was made in the prior year in respect of indirect tax charges for a tax reassessment in France. The provision
is based on management’s best estimate of the reassessment liability after taking expert legal advice. Legal fees and expense
directly attributable to the tax investigation of £374,000 were incurred in the prior year in connection with this matter. There have
been no further developments following the end of the prior financial year and it is unclear when the matter is likely to be resolved.
7 The impairment of goodwill in the prior year is in relation to SafeSkys Limited. Please see note 13 – Goodwill for further details.
8 The Group successfully closed two historical legal disputes in the prior year resulting in the receipt of cash settlements in both
cases. The income recognised is net of associated legal expenses.
9 The adjustment to deferred consideration in the current year relates to the fair valuing of the deferred consideration relating to
Redline Worldwide Limited. The prior year is in relation to SafeSkys Limited, where a settlement was reached for less than the
amount provided for in the prior year’s financial statements.
10 A tax credit has been included in the current year in respect of the restructuring costs incurred in the UK and amortisation of
purchased intangibles. The tax credit on the purchased intangibles is offset by the change in tax rate used to calculate the deferred
tax liability for these assets from 17.0% to 19.0%. At 31 January 2020, a reduction in the UK corporation tax rate on 1 April 2020 to 17.0%
as a result of legislation enacted on 16 October 2016 was in effect. The Spring Budget 2020 announced that the corporation tax rate
would remain at 19.0%.
8 Staff costs
Group
The monthly average number of people employed by the Group (including Directors) during the year, analysed by
category, was as follows:
2021
2020
Continuing operations
Number
Number
Operations
342
293
Administration
103
86
445
379
The aggregate payroll costs comprised:
2021
2020
Continuing operations
£’000
£’000
Wages and salaries
25,174
19,722
Social security costs
3,094
2,519
Other pension costs
662
730
Share based payments
451
59
29,381
23,030
Financial statements
136
Air Partner plc | Annual Report 2021
8 Staff costs continued
Group continued
Throughout the year the Group received £1,703,000 (FY20: £nil) in government support from schemes designed to
encourage staff retention throughout the pandemic (see note 35 – Government grants). The grant income has been
offset against the expenditure as permitted, meaning staff costs are stated net of the government support. An analysis
of the government support received during the year is as follows:
Gross staff
costs
Government
support
Net staff
costs
2021
2021
2021
Continuing operations
£’000
£’000
£’000
Wages and salaries
25,174
(1,532)
23,642
Social security costs
3,094
(163)
2,931
Other pension costs
662
(8)
654
Share based payments
451
—
451
29,381
(1,703)
27,678
Company
The monthly average number of people employed by the Company (including Directors) during the year, analysed by
category, was as follows:
2021
2020
Continuing operations
Number
Number
Operations
63
72
Administration
37
43
100
115
The aggregate payroll costs comprised:
2021
2020
Continuing operations
£’000
£’000
Wages and salaries
7,102
6,542
Social security costs
893
728
Other pension costs
284
328
Share based payments
339
59
8,618
7,657
Throughout the year the Company received £209,000 (FY20: £nil) in government support from schemes designed
to encourage staff retention throughout the pandemic. The grant income has been offset against the expenditure as
permitted, meaning staff costs are stated net of the government support. An analysis of the government support
received during the year is as follows:
Gross staff
costs
Government
support
Net staff
costs
2021
2021
2021
Continuing operations
£’000
£’000
£’000
Wages and salaries
7,102
(191)
6,911
Social security costs
893
(15)
878
Other pension costs
284
(3)
281
Share based payments
339
—
339
8,618
(209)
8,409
The Group contributes to personal pension plans of certain employees and this cost is charged to the income
statement in the period in which it is incurred.
Full disclosure of Directors’ emoluments, share options and pension entitlements, which form part of their remuneration
packages, and their interests in the Company’s share capital are disclosed in the Directors’ remuneration report for the
year ended 31 January 2021.
Financial statements
137
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
9 Finance income and expense
2021
2020
Continuing operations
£’000
£’000
Finance income
Interest on bank deposits
29
71
2021
2020
Continuing operations
£’000
£’000
Finance expense
Interest on loans and bank overdrafts
289
311
IFRS 16 discounting
214
301
Total
503
612
10 Income tax expense
2021
2020
Continuing operations
£’000
£’000
Current tax:
UK corporation tax
778
620
Foreign tax
2,580
408
Current tax adjustments in respect of prior years (UK)
(108)
(200)
Current tax adjustments in respect of prior years (overseas)
235
(208)
3,485
620
Deferred tax (see note 26)
(738)
13
Total tax
2,747
633
Of which:
Tax on underlying profit
3,078
866
Tax on other items (see note 7)
(331)
(233)
2,747
633
Corporation tax in the UK was calculated at 19.0% (2020: 19.0%) of the estimated assessable profit for the year.
Taxation for other jurisdictions was calculated at the rates prevailing in the respective jurisdictions.
The charge for the year can be reconciled to the profit per the consolidated income statement as follows:
2021
2020
£’000
£’000
Profit from continuing operations before income tax expense
8,379
936
Income tax at the UK corporation tax rate of 19.0% (2020: 19.0%)
1,592
178
Effect of changes in tax rates
206
—
Tax effect of items that are not recognised in determining taxable profit
(316)
407
Tax effect of different tax rates of subsidiaries operating in other jurisdictions
426
(158)
Current tax adjustments in respect of prior years
127
(408)
Deferred tax not recognised1
620
603
Options deductions
92
11
Total income tax expense
2,747
633
1 Deferred tax not recognised in the current year relates to tax losses carried forward in France and Italy that have not been recognised
as deferred tax assets. Management has opted not to recognise these assets based on the expected economic impact of COVID-19
and therefore does not expect the losses to be usable in the foreseeable future. The assumption will be reassessed each year.
Financial statements
138
Air Partner plc | Annual Report 2021
10 Income tax expense continued
At the previous balance sheet date, a reduction to the UK corporation tax to 17.0% on 1 April 2020 had been substantively
enacted on 16 October 2016. Prior year deferred tax balances were stated at this rate (see note 26 – Deferred tax). In
the Spring Budget 2020, the government announced that from 1 April 2020 the corporation tax rate would remain at
19.0% (rather than reducing to 17.0%, as previously enacted). This new law was substantively enacted on 17 March 2020.
In the Spring Budget 2021, the government announced that from 1 April 2023 the corporation tax rate will increase
to 25.0%. As the proposal to increase the rate to 25% had not been substantively enacted at the balance sheet date,
its effects are not included in these financial statements.
11 Dividends
2021
2020
£’000
£’000
Amounts recognised as distributions to owners of the parent company
Final dividend for the year ended 31 January 2019 of 3.85 pence per share
—
2,011
Interim dividend for the year ended 31 January 2021 of 0.80 pence per share
508
—
Interim dividend for the year ended 31 January 2020 of 1.80 pence per share
—
950
508
2,961
The Directors propose a final dividend for the year ended 31 January 2021 of 1.60 pence per share, subject to shareholder
approval at the Annual General Meeting to be held on 8 July 2021.
The Air Partner Employee Benefit Trust, which held 47,502 ordinary shares of 1 pence each at 31 January 2021
(2020: 69,928 ordinary shares of 1 pence each) representing 0.07% (2020: 0.13%) of the Company’s issued share capital,
is not entitled to receive dividends. At 31 January 2020 a further 90,910 ordinary shares of 1 pence each were held by
the Trust in a nominee capacity for one beneficiary of the Trust but dividends were received in respect of those shares.
No further shares relating to this beneficiary were held at 31 January 2021.
12 Earnings per share
2021
2020
Earnings per share
Pence
Pence
Continuing operations
Basic
9.4
0.6
Diluted
9.3
0.6
2021
2020
Earnings per share
Pence
Pence
Excluding exceptional and other items
Basic
14.2
6.4
Diluted
14.0
6.3
2021
2020
From continuing operations
£’000
£’000
Earnings
Profit attributable to owners of the parent company
5,632
303
Adjustment to exclude exceptional and other items1
2,848
3,063
Underlying earnings for the calculation of basic and diluted earnings per share
8,480
3,366
1 The calculation of underlying earnings per share (before exceptional and other items) is included as the Directors believe it
provides a better understanding of the underlying performance of the Group. Exceptional and other items are disclosed in note 7
– Exceptional and other items.
Financial statements
139
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
12 Earnings per share continued
The calculation of the basic and diluted earnings per share is based on the following data:
2021
2020
Weighted average number of ordinary shares
Number
Number
Issued and fully paid
59,970,013
52,756,188
Less those held by the Air Partner Employee Benefit Trust
(51,898)
(85,952)
Number for the calculation of basic earnings per share
59,918,115
52,670,236
Effect of dilutive potential ordinary shares: share options
697,851
844,022
Number for the calculation of diluted earnings per share
60,615,966
53,514,258
13 Goodwill
Group
£’000
Cost
At 1 February 2019
6,750
Additions
3,814
Foreign currency adjustments
(38)
At 31 January 2020
10,526
Additions
—
Foreign currency adjustments
51
At 31 January 2021
10,577
Provision for impairment
At 1 February 2019
—
Charge for the year
(1,885)
At 31 January 2020
(1,885)
Charge for the year
—
At 31 January 2021
(1,885)
Net book value
At 31 January 2021
8,692
At 31 January 2020
8,641
At 1 February 2019
6,750
The additions in the prior year related to the acquisition of Redline Worldwide Limited (see note 32 – Prior year
acquisition of subsidiaries) for £3,644,000. An adjustment of £170,000 for SafeSkys Limited was made during the
prior year following finalising the settlement of the amount payable on acquisition.
Goodwill acquired in a business combination is allocated, at acquisition, to the cash-generating units (CGUs), or Group
of units that are expected to benefit from that business combination. After recognition of impairment losses, the
carrying amount of goodwill has been allocated as follows:
2021
2020
£’000
£’000
Air Partner International S.A.S.1
987
936
Baines Simmons Limited
1,711
1,711
Cabot Aviation Services Limited
787
787
Clockwork Research Limited
396
396
Redline Worldwide Limited
3,644
3,644
SafeSkys Limited
1,167
1,167
8,692
8,641
1 The goodwill held in respect of Air Partner International S.A.S. arose in the local currency of Euros and therefore the amount
expressed in Sterling varies depending on exchange rates.
Financial statements
140
Air Partner plc | Annual Report 2021
13 Goodwill continued
Impairment testing
Goodwill and other intangibles are tested for impairment at least annually or when there is an indication that the
carrying value may not be recoverable. Value in use is calculated as the net present value of the projected risk-adjusted
cash flows of the CGU. These forecast cash flows are based on the 2022 budget and the five-year strategic plan.
The impairment models do include sensitivity testing to ascertain whether a reasonable change in the underlying
assumptions could indicate an impairment.
Management reviewed the status of the following CGUs and found no indication of impairments:
‣ Air Partner International S.A.S.;
‣ Baines Simmons Limited;
‣ Cabot Aviation Services Limited;
‣ Clockwork Research Limited; and
‣ Redline Worldwide Limited.
As an impairment was recorded against SafeSkys Limited in the prior year, any further adverse change in assumptions
would give rise to a further impairment in value. Sensitivity analysis is provided below. There is no reasonably foreseeable
change in assumptions that would give rise to an impairment in value of the other goodwill balances.
Impairment testing assumptions
Based on the impairment testing of SafeSkys Limited, management identified a potential impairment as at 31 January
2020. The key assumptions used in the value in use calculation for SafeSkys Limited and all other CGUs were:
‣ sales: projected sales are built up in line with the strategic business plan;
‣ margins: reflect the anticipated margins within the strategic business plan;
‣ discount rate: an exercise has been undertaken to review the discount rate resulting in a post-tax discount rate
of 8.65%; and
‣ long-term growth rates: growth rates for the period after the detailed forecasts are based on the long-term GDP
projections, which is 2%.
The assumptions used in the impairment testing model were as follows:
Basis of valuation
Value in use
Discount rate
8.65%
Period covered by management projections
5 years
Long-term growth rates
2.0%
Sensitivity 1
A further reduction on forecasted operating profit of 10% each year to account for non-renewal or cost creep
in existing contracts.
Sensitivity 2
The discount rate has been increased by 4.0%. This adjustment is deemed to capture all changes to the trading
environment and reflect a tougher trading environment compared to the base case.
The following sensitivities have been provided in relation to SafeSkys Limited, being the only CGU where the Directors
believe a reasonable change in assumptions could give rise to a further impairment in value.
PV
Goodwill
and other
intangible
assets
Headroom
Scenario
£’000
£’000
£’000
Base case
2,029
1,815
214
Sensitivity 1
1,826
1,815
11
Sensitivity 2
1,274
1,815
(541)
There have been no key changes to the assumptions in the current year’s strategic plan compared to the previous year.
The increase in headroom from the prior year reflects that SafeSkys Limited has settled the costs associated with the
exit from the Air Traffic Control contracts.
Financial statements
141
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
13 Goodwill continued
Impairment testing assumptions continued
Redline Worldwide Limited sensitivity is shown below. The assumptions are in line with those used for SafeSkys.
Although COVID-19 reduced the expected revenue for FY21 it still made a net contribution to the Group. The Directors
expect to see a strong recovery over FY22 and FY23 resulting in significant headroom on the base case scenario.
Goodwill
Other non-
and other
current
intangible
assets and
PV
assets
liabilities
Headroom
Scenario
£’000
£’000
£’000
£’000
Base case
16,203
8,734
152
7,317
Sensitivity 1
14,582
8,734
152
5,696
Sensitivity 2
10,017
8,734
152
1,131
Based on the impairment testing performed, the Directors believe that there are no reasonable possible changes to
the key assumptions that would result in a material impairment of goodwill.
14 Other intangible assets
Customer
relationships
IFRS 16
Other
and customer
Training
right of use
Brands
mandates
contracts
materials
Software
asset
Total
Group
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Cost
At 1 February 2019
172
171
4,336
414
2,806
—
7,899
Transition to IFRS 16
—
—
—
—
—
104
104
Additions
1
—
—
—
375
—
376
Arising on acquisition
—
—
6,100
—
1,400
—
7,500
Foreign currency adjustments
—
—
—
—
(1)
—
(1)
At 31 January 2020
173
171
10,436
414
4,580
104
15,878
Additions
—
—
—
—
231
—
231
Disposals
—
—
—
—
(1,716)
—
(1,716)
Foreign currency adjustments
—
—
—
—
(4)
—
(4)
At 31 January 2021
173
171
10,436
414
3,091
104
14,389
Accumulated amortisation and
impairment
At 1 February 2019
63
171
821
145
1,817
—
3,017
Charge for the year
21
—
533
41
373
22
990
Foreign currency adjustments
—
—
—
—
(1)
—
(1)
At 31 January 2020
84
171
1,354
186
2,189
22
4,006
Charge for the year
16
—
1,896
41
867
21
2,841
Disposals
—
—
—
—
(1,716)
—
(1,716)
Foreign currency adjustments
—
—
—
—
(2)
—
(2)
At 31 January 2021
100
171
3,250
227
1,338
43
5,129
Net book value
At 31 January 2021
73
—
7,186
187
1,753
61
9,260
At 31 January 2020
89
—
9,082
228
2,391
82
11,872
At 1 February 2019
109
—
3,515
269
989
—
4,882
Customer relationships have a remaining amortisation period of between 0.0 years and 15.5 years.
Financial statements
142
Air Partner plc | Annual Report 2021
14 Other intangible assets continued
IFRS 16
right of use
Software
asset
Total
Company
£’000
£’000
£’000
Cost
At 1 February 2019
2,745
—
2,745
Transition to IFRS 16
—
104
104
Additions
354
—
354
At 31 January 2020
3,099
104
3,203
Additions
177
—
177
Disposals
(1,700)
—
(1,700)
At 31 January 2021
1,576
104
1,680
Accumulated amortisation and impairment
At 1 February 2019
1,789
—
1,789
Charge for the year
297
22
319
At 31 January 2020
2,086
22
2,108
Charge for the year
373
21
394
Disposals
(1,700)
—
(1,700)
At 31 January 2021
759
43
802
Net book value
At 31 January 2021
817
61
878
At 31 January 2020
1,013
82
1,095
At 1 February 2019
956
—
956
Other intangible assets comprise software and assets acquired on acquisitions including training materials, customer
relationships, mandates to remarket aircraft and brands.
Financial statements
143
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
15 Property, plant and equipment
Short leasehold
property and
Fixtures
IFRS 16
leasehold
and
Motor
right of
improvements
equipment
vehicles
use asset
Total
Group
£’000
£’000
£’000
£’000
£’000
Cost
At 1 February 2019
1,167
2,948
170
—
4,285
Transition to IFRS 16
—
—
—
11,375
11,375
Additions
15
328
206
188
737
Arising on acquisition
54
53
—
804
911
Disposals
(43)
—
—
—
(43)
Foreign currency adjustments
(6)
(27)
—
(379)
(412)
At 31 January 2020
1,187
3,302
376
11,988
16,853
Additions
—
284
53
320
657
Disposals
(156)
(889)
(82)
(658)
(1,785)
Foreign currency adjustments
8
16
—
467
491
At 31 January 2021
1,039
2,713
347
12,117
16,216
Accumulated depreciation and impairment
At 1 February 2019
769
2,610
51
—
3,430
Charge for the year
136
229
62
5,413
5,840
Foreign currency adjustments
(4)
(18)
—
(93)
(115)
At 31 January 2020
901
2,821
113
5,320
9,155
Charge for the year
133
170
81
1,688
2,072
Impairment
—
—
—
81
81
Disposals
(146)
(863)
(62)
(318)
(1,389)
Foreign currency adjustments
5
13
—
232
250
At 31 January 2021
893
2,141
132
7,003
10,169
Net book value
At 31 January 2021
146
572
215
5,114
6,047
At 31 January 2020
286
481
263
6,668
7,698
At 1 February 2019
398
338
119
—
855
Financial statements
144
Air Partner plc | Annual Report 2021
15 Property, plant and equipment continued
Short leasehold
property and
Fixtures
IFRS 16
leasehold
and
Motor
right of
improvements
equipment
vehicles
use asset
Total
Company
£’000
£’000
£’000
£’000
£’000
Cost
At 1 February 2019
868
1,691
56
—
2,615
Transition to IFRS 16
—
—
—
1,660
1,660
Additions
13
130
—
—
143
At 31 January 2020
881
1,821
56
1,660
4,418
Additions
—
9
—
75
84
Disposals
—
—
(56)
—
(56)
At 31 January 2021
881
1,830
—
1,735
4,446
Accumulated depreciation
At 1 February 2019
575
1,560
30
—
2,165
Charge for the year
101
116
6
578
801
At 31 January 2020
676
1,676
36
578
2,966
Charge for the year
112
57
3
580
752
Disposals
—
—
(39)
—
(39)
At 31 January 2021
788
1,733
—
1,158
3,679
Net book value
At 31 January 2021
93
97
—
577
767
At 31 January 2020
205
145
20
1,082
1,452
At 1 February 2019
293
131
26
—
450
The recognised IFRS 16 right of use assets of the policy relate to the following types of assets:
Group
Company
2021
2020
2021
2020
£’000
£’000
£’000
£’000
Short leasehold property and leasehold investments
822
1,546
26
206
Fixtures and equipment
566
996
551
876
Motor vehicles
21
84
—
—
Aircraft
3,705
4,042
—
—
5,114
6,668
577
1,082
Financial statements
145
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
16 Investments
Investments
Capital
in shares of
contributions
subsidiaries
to subsidiaries
Total
Company
£’000
£’000
£’000
Cost
At 1 February 2019
2,485
10,424
12,909
Additions
11,290
—
11,290
Disposal of subsidiaries
(41)
(627)
(668)
Decrease in deferred consideration1
—
(198)
(198)
At 31 January 2020
13,734
9,599
23,333
Additions
—
112
112
Disposal of subsidiaries
(37)
(8)
(45)
At 31 January 2021
13,697
9,703
23,400
Amounts provided
At 1 February 2019
101
635
736
Charge for the year
—
1,050
1,050
Dissolution of subsidiaries2
(41)
(627)
(668)
At 31 January 2020
60
1,058
1,118
Charge for the year
—
—
—
Dissolution of subsidiaries2
(37)
(8)
(45)
At 31 January 2021
23
1,050
1,073
Net book value
At 31 January 2021
13,674
8,653
22,327
At 31 January 2020
13,674
8,541
22,215
At 1 February 2019
2,384
9,789
12,173
1 The decrease in deferred consideration in the prior year was in respect of SafeSkys Limited, where the final deferred consideration
paid was less than the amount previously provided.
2 Air Partner (Switzerland) AG was dissolved within the current year and Air Partner Nordic was dissolved within the prior financial year.
The Company tests its investments for impairment if there are indications that the investments may be impaired.
The Directors have assessed investments and consider there to be no impairment triggers. See the assumptions
detailed in note 13 – Goodwill, for further information.
Financial statements
146
Air Partner plc | Annual Report 2021
16 Investments continued
The following is a list of the subsidiaries of which Air Partner plc, incorporated in England and Wales, is the beneficial owner:
Name
Principal activity
Country of incorporation
Company number
Company address
Air Partner International S.A.S.
Air charter broking
France
B398335489
A
Air Partner International GmbH
Air charter broking
Germany
HRB 28279
B
Air Partner Srl
Air charter broking
Italy
3935230262
C
Air Partner Havacilik ve
Tasimacilik Limited Sirketi
Air charter broking
Turkey
720099
D
Air Partner Middle East DMCC
Air charter broking
United Arab Emirates
DMCC179270
E
Air Partner, Inc.
Air charter broking
US
65-0770487
F
Air Partner Aviation Services
Limited (previously Cabot
Aviation Services Limited)
Air charter broking
England and Wales
03874833
G
Air Partner Travel Management
Company Limited
Travel agency
England and Wales
03767092
G
Aviation Compliance Limited
Aviation safety
consultants
England and Wales
06545827
G
Baines Simmons Limited
Aviation safety
consultants
England and Wales
04295495
G
Clockwork Research Limited
Aviation safety
consultants
England and Wales
05477740
G
SafeSkys Limited
Aviation safety
consultants
England and Wales
02833067
G
Air Partner CHS Limited
(previously Air Partner
Enclave Limited)
Security training
England and Wales
06671502
G
Redline Aviation Security Limited
Security training
England and Wales
05915087
G
Air Partner Consulting Limited
Holding company
England and Wales
02070950
G
Redline Worldwide Limited
Holding company
England and Wales
09510974
G
Redline Assured Security Limited
Dormant
England and Wales
09802270
G
Redline Assured Security SARL
Dormant
France
878435114
H
Air Partner Group Limited
Dormant
England and Wales
03685545
G
Air Partner Investments Limited
Dormant
England and Wales
06727735
G
Business Jets Limited
Dormant
England and Wales
04146214
G
All of the above are 100% owned by Air Partner plc, except for Air Partner Havacilik ve Tasimacilik Limited Sirketi, where
40% is held by a subsidiary undertaking. Air Partner plc’s holdings are in the ordinary share capital of all the subsidiaries.
Additions in the current year all relate to share options in the Company granted to employees of subsidiaries.
During the prior year the Group renamed Air Partner Enclave Limited to Air Partner CHS Limited. The company
ceased to be dormant, purchased the trade and assets of CHS Engineering Services Limited for a nominal amount
and began trading.
Redline Worldwide Limited has a 100% holding in Redline Aviation Security Limited for £11,278,000. Details of the
breakdown of acquisition are included in note 32 – Acquisition of subsidiaries. Redline Aviation Security Limited has
a 100% holding in Redline Assured Security Limited and Redline Assured Security SARL.
Air Partner (Switzerland) AG was dissolved during the financial year.
Financial statements
147
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
16 Investments continued
The registered company addresses are as follows:
A
89/91 Rue du Faubourg Saint-Honoré, 75008 Paris, France
B
Im Mediapark 5b, 50670 Köln, Germany
C
Via Valtellina 67, 20159 Milano, Italy
D
Halil Rıfatpaşa Mh Yüzer Havuz Sk No.1 Perpa Ticaret Merkezi ABlok Kat.12 No.1773, Istanbul, Turkey
E
Cluster X, Building X3, Office 606, Jumeirah Lake Towers, Dubai, UAE
F
1100 Lee Wagener Blvd, Suite 328, Fort Lauderdale, FL 33315, US
G
2 City Place, Beehive Ring Road, Gatwick, West Sussex RH6 0PA, UK
H
27 Boulevard Saint-Martin, 75003 Paris, France
In the opinion of the Directors the recoverable amount of the Company’s subsidiary undertakings is considered to be
in excess of the carrying value.
17 Trade and other receivables
Group
Company
2021
2020
2021
2020
£’000
£’000
£’000
£’000
Gross trade receivables
6,731
9,623
1,661
3,117
Loss allowance
(1,114)
(854)
(29)
—
Trade receivables
5,617
8,769
1,632
3,117
Amounts owed by Group undertakings
—
—
7,278
5,756
Social security and other taxes
593
1,215
185
338
Other receivables
422
407
126
122
Prepayments and accrued income1
3,276
8,410
1,100
3,172
9,908
18,801
10,321
12,505
1 Prepayments and accrued income are relatively high compared to trade receivables due to the impact of IFRS 15 and cash flow
implications. The Group will often need to make payments in advance of the service performed to enable it to secure the resources
required. However, the customer will not pay until nearer or after the flight date. As a result under IFRS 15 the trade debtor and
matching deferred revenue are not recognised but the cash outflow and prepayment are.
Amounts owed by Group undertakings are interest free, unsecured and repayable on demand.
Prepayments and accrued income include £1,551,000 of operator prepayments (2020: £5,692,000) and accrued
income of £647,000 (2020: £1,973,000). All accrued income is in relation to known invoices not issued at the year end.
All accrued income will be converted within the 12 months. The remainder of the prepayments and accrued income is
for prepayments relating to overheads.
Classification as trade receivables
Trade receivables are amounts due from customers for goods sold or services performed in the ordinary course of
business. They are generally due for settlement within 30 days of becoming due.
The Directors consider that the carrying amount of trade and other receivables approximates to their fair value.
Financial statements
148
Air Partner plc | Annual Report 2021
17 Trade and other receivables continued
Classification as trade receivables continued
All trade and other receivables have been reviewed for indicators of impairment. The movement in impaired
receivables in the year is shown below:
Group
Company
£’000
£’000
At 1 February 2019
698
1
Charge for the year
205
—
Receivables written off during the year
(27)
(1)
Foreign currency adjustments
(22)
—
At 31 January 2020
854
—
Charge for the year
810
90
Receivables written off during the year
(571)
(58)
Foreign currency adjustments
21
(3)
At 31 January 2021
1,114
29
Of the amounts impaired during the year, £153,000 (2020: £123,000) was for an amount past due by less than one
year with the remainder being all overdue by more than one year.
An analysis of these financial assets at the statement of financial position date for 2021 is as follows:
Allowance
for bad and
Gross trade
doubtful
Trade
receivables
debts
receivables
2021
2021
2021
Group
£’000
£’000
£’000
Current
2,081
—
2,081
Aged:
– By not more than three months
3,268
—
3,268
– By more than three months but not more than six months
399
(131)
268
– By more than six months but not more than one year
37
(37)
—
– By more than one year
946
(946)
—
6,731
(1,114)
5,617
Allowance
for bad and
Gross trade
doubtful
Trade
receivables
debts
receivables
2020
2020
2020
Group
£’000
£’000
£’000
Current
3,066
—
3,066
Aged:
– By not more than three months
4,635
(2)
4,633
– By more than three months but not more than six months
767
(231)
536
– By more than six months but not more than one year
465
(21)
444
– By more than one year
690
(600)
90
9,623
(854)
8,769
Financial statements
149
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
17 Trade and other receivables continued
Classification as trade receivables continued
Allowance
for bad and
Gross trade
doubtful
Trade
receivables
debts
receivables
2021
2021
2021
Company
£’000
£’000
£’000
Current
534
—
534
Aged:
– By not more than three months
1,001
—
1,001
– By more than three months but not more than six months
81
—
81
– By more than six months but not more than one year
10
—
10
– By more than one year
35
(29)
6
1,661
(29)
1,632
Allowance
for bad and
Gross trade
doubtful
Trade
receivables
debts
receivables
2020
2020
2020
Company
£’000
£’000
£’000
Current
1,087
—
1,087
Aged:
– By not more than three months
1,987
—
1,987
– By more than three months but not more than six months
10
—
10
– By more than six months but not more than one year
32
—
32
– By more than one year
1
—
1
3,117
—
3,117
18 Cash, borrowings and net cash
Group
Company
2021
2020
2021
2020
Cash
£’000
£’000
£’000
£’000
JetCard cash
17,805
16,742
11,611
11,717
Non-JetCard cash
9,916
4,633
5,751
411
Cash and cash equivalents
27,721
21,375
17,362
12,128
Group
Company
2021
2020
2021
2020
Borrowings
£’000
£’000
£’000
£’000
Secured bank loans
—
11,500
—
11,500
Group
Company
2021
2020
2021
2020
£’000
£’000
£’000
£’000
Amount due for settlement within 12 months
—
—
—
—
Amount due for settlement after 12 months
—
11,500
—
11,500
—
11,500
—
11,500
Financial statements
150
Air Partner plc | Annual Report 2021
18 Cash, borrowings and net cash continued
Group
Company
2021
2020
2021
2020
Net cash
£’000
£’000
£’000
£’000
Cash
27,721
21,375
17,362
12,128
Borrowings
—
(11,500)
—
(11,500)
Net cash
27,721
9,875
17,362
628
Group
Company
2021
2020
2021
2020
Net cash/(debt) excluding JetCard cash
£’000
£’000
£’000
£’000
Non-JetCard cash
9,916
4,633
5,751
411
Borrowings
—
(11,500)
—
(11,500)
Net cash/(debt) excluding JetCard cash
9,916
(6,867)
5,751
(11,089)
All borrowings are in Sterling.
The Group has no borrowings outstanding at 31 January 2021 (2020: £11.5m comprised of a bank loan from the
Group’s banker).
The Group has access to a revolving credit facility of £13.0m with an interest rate of 2.6% above LIBOR, expiring
in February 2023. The loan is secured by a floating charge over the Company’s assets.
19 Trade and other payables
Group
Company
2021
2020
2021
2020
£’000
£’000
£’000
£’000
Trade payables
2,713
3,421
1,061
1,664
Other taxation and social security payable
1,574
2,248
239
235
4,287
5,669
1,300
1,899
The Directors consider that the carrying amount of trade and other payables approximates to their fair value.
20 Other liabilities
Group
Company
2021
2020
2021
2020
£’000
£’000
£’000
£’000
Accruals
6,536
4,880
2,847
2,827
Other liabilities
367
134
123
—
Amounts owed to Group undertakings
—
—
5,883
3,745
6,903
5,014
8,853
6,572
Amounts owed to Group undertakings are interest free, unsecured and repayable on demand.
The Directors consider that the carrying amount of other liabilities approximates to their fair value.
Financial statements
151
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
21 Lease liabilities
Lease liabilities are effectively secured as the rights to the leased asset revert to the lessor in the event of default.
All leases recognised are as a result of the adoption of IFRS 16.
Group
Company
2021
2020
2021
2020
Gross lease liability – minimum lease payments
£’000
£’000
£’000
£’000
No later than one year
4,916
5,607
362
659
Later than one year and no later than five years
1,111
1,835
316
667
Later than five years
—
96
—
—
6,027
7,538
678
1,326
Future finance charges on lease liabilities
(158)
(230)
(23)
(55)
5,869
7,308
655
1,271
Present value of lease liabilities
£’000
£’000
£’000
£’000
No later than one year
4,809
5,448
346
627
Later than one year and no later than five years
1,060
1,765
309
644
Later than five years
—
95
—
—
5,869
7,308
655
1,271
22 Deferred consideration
Group
Company
2021
2020
2021
2020
Within current liabilities
£’000
£’000
£’000
£’000
Deferred consideration in respect of Redline Worldwide Limited (note 32)
—
1,268
—
1,268
Provision for costs for raising of funds for Redline Worldwide Limited
—
50
—
50
—
1,318
—
1,318
Group
Company
2021
2020
2021
2020
Within non-current liabilities
£’000
£’000
£’000
£’000
Deferred consideration in respect of Redline Worldwide Limited (note 32)
991
982
991
982
991
982
991
982
23 Provisions
Group
Company
2021
2020
2021
2020
Within current liabilities
£’000
£’000
£’000
£’000
Onerous contracts1
—
98
—
—
Prior year indirect tax charges2
298
283
—
—
Dilapidations3
200
—
200
—
Other
237
88
23
24
735
469
223
24
1 The onerous contracts provision in the prior year was in relation to two loss-making contracts identified in the SafeSkys Limited
business as part of the fair value exercise on acquisition. Both contracts were exited during the year.
2 The provision for prior year indirect tax charges is in respect of indirect tax charges for a prior year tax reassessment in France.
The figure represents the best estimate of the liability after taking expert legal advice. Final resolution of the matter is expected
during the coming financial year.
3 The dilapidation provision is in relation to the potential costs of making good any dilapidations which may occur during the course
of the lease of property.
Financial statements
152
Air Partner plc | Annual Report 2021
23 Provisions continued
Group
Company
2021
2020
2021
2020
Within non-current liabilities
£’000
£’000
£’000
£’000
Dilapidation costs1
149
349
—
200
Other
19
44
—
—
168
393
—
200
1 The dilapidation provision is in relation to the potential costs of making good any dilapidations which may occur during the course
of the lease of property.
For the provisions no discounting has been included as it would be immaterial.
The range of potential outcomes is not materially different to the amounts included with the exception of the provision
for prior year indirect tax charges. The Directors consider the probability of a materially different outcome as remote.
The provision represents a best estimate of the probable outflow and a material difference is considered a remote
possibility. See note 2w – Critical accounting judgements and sources of estimation uncertainty.
Movement in each class of provision for the Group during the financial year is set out below:
Onerous Dilapidation
Prior year
indirect tax
contracts
costs
charges
Other
Total
£’000
£’000
£’000
£’000
£’000
Carrying amount at 1 February 2020
98
349
283
132
862
Charged to profit or loss:
– Additional provisions recognised
—
—
—
150
150
Amounts used during the year
(98)
—
—
(28)
(126)
Foreign exchange
—
—
15
2
17
Carrying amount at 31 January 2021
—
349
298
256
903
Movement in each class of provision for the Company during the financial year is set out below:
Dilapidation
costs
Other
Total
£’000
£’000
£’000
Carrying amount at 1 February 2020
200
24
224
Charged to profit or loss:
– Additional provisions recognised
—
—
—
Amounts used during the year
—
—
—
Foreign exchange
—
(1)
(1)
Carrying amount at 31 January 2021
200
23
223
Financial statements
153
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
24 Financial instruments
The objectives of the Group’s treasury activities are to manage financial risk, minimise the adverse effects of
fluctuations in the financial markets on the value of the Group’s financial assets and liabilities and ensure that the
working capital requirements fit the needs of the ongoing business.
The Group has various financial instruments such as cash, trade receivables, trade payables and borrowings that arise
directly from its operations, along with forward currency contracts undertaken to minimise risk on future business.
a) Interest rate risk
The Group’s policy is to manage interest rate risk and to maximise its return from its cash balances. The Group’s main
interest rate risk is related to variable rates on cash held at the bank and borrowings. Certain cash balances are deposits
on fixed interest terms, but are never lodged for more than three months to ensure that the Group does not suffer
unduly from the risk of interest rate variation.
Group
Company
2021
2020
2021
2020
£’000
£’000
£’000
£’000
Cash held at year end without interest rates
24,157
16,742
17,027
11,423
Cash held at year end on variable interest rates
3,564
4,633
335
705
27,721
21,375
17,362
12,128
The following table illustrates the sensitivity of cash held on variable interest rates on profit before tax for the year
to a reasonably possible change in interest rates, with effect from the beginning of the year. There was no additional
impact on shareholders’ equity. These changes are considered to be reasonably possible based on observation of
current market conditions. The rate range on which interest was receivable during the year was 0.00% to 1.32%
(2020: 0.00% to 1.55%).
Effect on profit before tax
100 basis points increase
100 basis points decrease
2021
2020
2021
2020
Group
£’000
£’000
£’000
£’000
Cash held at year end on variable interest rates
36
46
(36)
(46)
Effect on profit before tax
100 basis points increase
100 basis points decrease
2021
2020
2021
2020
Company
£’000
£’000
£’000
£’000
Cash held at year end on variable interest rates
3
7
(3)
(7)
The Group historically had been further exposed to interest rate risk due to variable interest owed on its borrowings
(2020: £11,500,000), linked to LIBOR, but repaid the balance during the year.
The following table illustrates the sensitivity of borrowings on variable interest rates on profit before tax for the year
to a reasonably possible change in interest rates, with effect from the beginning of the year. There was no additional
impact on shareholders’ equity. These changes are considered to be reasonably possible based on observation of
current market conditions. The rate at which interest was payable during the year was 3.02% (2020: 3.18%).
Effect on profit before tax
100 basis points increase
100 basis points decrease
2021
2020
2021
2020
Group and Company
£’000
£’000
£’000
£’000
Borrowings on variable interest rates
—
(115)
—
115
Financial statements
154
Air Partner plc | Annual Report 2021
24 Financial instruments continued
b) Credit risk
The carrying amount of financial assets recognised at the reporting date, as summarised below, represents the
Group’s maximum exposure to credit risk:
Group
Company
2021
2020
2021
2020
£’000
£’000
£’000
£’000
Cash and cash equivalents
27,721
21,375
17,362
12,128
Trade and other receivables
6,686
11,149
1,909
9,680
34,407
32,524
19,271
21,808
The Group constantly monitors defaults of customers and other counterparties and incorporates this information into
its credit risk controls. It is the Group’s policy that all counterparties which wish to trade on credit terms are subject to
an external credit verification process.
The Directors consider that all of the above financial assets that are not impaired for each of the reporting dates under
review are of good credit quality, including those that are past due.
The Group has no significant concentration of credit risk to commercial customers, as credit risk is predominantly
government based.
The credit risk on liquid funds and derivative financial instruments is limited because the counterparties are banks
with high credit ratings assigned by international credit rating agencies.
Refer to note 17 – Trade and other receivables, for details of impairment losses for financial instruments.
c) Liquidity risk
The Group faces liquidity risks in paying operators before a flight occurs or before payment is received from the
customer. The Group aims to mitigate liquidity risk by, where possible, making payments to operators only once
payment from the customer has been received.
The Group manages cash within its operations and ensures that cash collection is efficiently managed. Any excess cash
is placed on low risk, short-term interest-bearing deposits or distributed to shareholders through dividends, although
the Group retains enough working capital in the business to ensure that the business operations can run smoothly.
As at 31 January 2021, the Group and Company’s financial liabilities had contractual maturities which are summarised below:
Current
Non-current
Within 6 months
6 to 12 months
1 to 5 years
More than 5 years
2021
2020
2021
2020
2021
2020
2021
2020
Group
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Trade and other payables
27,421
25,041
—
—
—
—
—
—
Bank loans
—
—
—
—
—
11,500
—
—
Lease liabilities
3,439
2,972
1,477
2,635
1,111
1,835
—
96
Derivative financial
instruments
—
39
—
—
—
—
—
—
30,860
28,052
1,477
2,635
1,111
13,335
—
96
Current
Non-current
Within 6 months
6 to 12 months
1 to 5 years
More than 5 years
2021
2020
2021
2020
2021
2020
2021
2020
Company
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Trade and other payables
21,525
19,953
—
—
—
—
—
—
Bank loans
—
—
—
—
—
11,500
—
—
Lease liabilities
203
336
159
323
316
667
—
—
Derivative financial
instruments
—
39
—
—
—
—
—
—
21,728
20,328
159
323
316
12,167
—
—
Financial statements
155
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
24 Financial instruments continued
c) Liquidity risk continued
Trade and other payables in the table above includes £17,805,000 of JetCard deposits (2020: £16,742,000). JetCard
deposits can be used at any time by the customer and are therefore treated as maturing within six months. Other
deferred income of £3,618,000 (2020: £7,916,000) which relates to services that have been invoiced but not yet
completed has not been included in the credit risk table. All other deferred income is expected to be converted within
the next 12 months.
d) Foreign currency risk
The Group has invested in foreign operations outside the UK and also buys and sells goods and services denominated
in currencies other than Sterling. As a result the value of the Group’s non-Sterling revenue, purchases, financial assets
and liabilities and cash flows can be affected by movements in exchange rates in general and in US Dollar and Euro
rates in particular. The Group’s policy on foreign currency risk is not to enter into forward contracts until a firm
contract has been signed.
The Group considers using derivatives where appropriate to hedge its exposure to fluctuations in foreign exchange
rates. The purpose is to manage the currency risks arising from the Group operations. It is the Group’s policy that no
trading in financial instruments will be undertaken.
Foreign currency denominated financial assets and liabilities, translated into Sterling at the closing rate, are as follows:
2021
2020
Group
Eur €
US $
GBP £
Other
Eur €
US $
GBP £
Other
Financial assets
18,684
8,175
7,492
56
17,812
6,608
7,907
199
Financial liabilities
(19,158)
(7,129)
(5,880)
(171)
(19,078)
(5,830)
(5,559)
(61)
Short-term exposure
(474)
1,046
1,612
(115)
(1,266)
778
2,348
138
Financial assets
—
—
—
—
—
—
—
—
Financial liabilities
(103)
—
(1,008)
—
(293)
(85)
(12,981)
—
Long-term exposure
(103)
—
(1,008)
—
(293)
(85)
(12,981)
—
(577)
1,046
604
(115)
(1,559)
693
(10,633)
138
2021
2020
Company
Eur €
US $
GBP £
Other
Eur €
US $
GBP £
Other
Financial assets
17,406
1,355
7,423
364
13,600
1,302
6,706
200
Financial liabilities
(12,285)
(3,351)
(6,153)
(100)
(12,713)
(1,484)
(6,370)
(83)
Short-term exposure
5,121
(1,996)
1,270
264
887
(182)
336
117
Financial assets
—
—
—
—
—
—
—
—
Financial liabilities
—
—
(316)
—
—
—
(12,167)
—
Long-term exposure
—
—
(316)
—
—
—
(12,167)
—
5,121
(1,996)
954
264
887
(182)
(11,831)
117
The following table demonstrates the sensitivity of financial instruments to a reasonably possible change in the Euro
and US Dollar exchange rates, with all other variables held constant, on profit before tax and equity. It assumes a 10%
change of the Sterling/Euro exchange rate for the year ended 31 January 2021 (2020: 10%). A 10% change is also
assumed for the Sterling/US Dollar exchange rate (2020: 10%). Both of these percentages have been determined
based on the average market volatility in exchange rates in the previous 12 months. The sensitivity is based on the
Group’s foreign currency financial instruments held at each reporting date and also takes into account forward
exchange contracts that offset effects from changes in currency exchange rates.
Financial statements
156
Air Partner plc | Annual Report 2021
24 Financial instruments continued
d) Foreign currency risk continued
If Sterling had strengthened against the Euro and US Dollar by 10% (2020: 10%) and 10% (2020: 10%) respectively, the
impact would have been as follows:
2021
2020
Group
Eur €
US $
Total
Eur €
US $
Total
Financial assets
(1,868)
(818)
(2,686)
(1,781)
(661)
(2,442)
Financial liabilities
1,926
713
2,639
1,937
592
2,529
Effect on profit before tax/equity
58
(105)
(47)
156
(69)
87
2021
2020
Company
Eur €
US $
Total
Eur €
US $
Total
Financial assets
(1,741)
(136)
(1,877)
(1,360)
(130)
(1,490)
Financial liabilities
1,228
335
1,563
1,271
148
1,419
Effect on profit before tax/equity
(513)
199
(314)
(89)
18
(71)
If Sterling had weakened against the Euro and US Dollar by 10% (2020: 10%) and 10% (2020: 10%) respectively, the
impact would have been as follows:
2021
2020
Group
Eur €
US $
Total
Eur €
US $
Total
Financial assets
1,868
818
2,686
1,781
661
2,442
Financial liabilities
(1,926)
(713)
(2,639)
(1,937)
(592)
(2,529)
Effect on profit before tax/equity
(58)
105
47
(156)
69
(87)
2021
2020
Company
Eur €
US $
Total
Eur €
US $
Total
Financial assets
1,741
136
1,877
1,360
130
1,490
Financial liabilities
(1,228)
(335)
(1,563)
(1,271)
(148)
(1,419)
Effect on profit before tax/equity
513
(199)
314
89
(18)
71
e) Forward contracts
These derivative financial instruments are not traded in active markets. Their fair value has been determined by using
valuation techniques which maximise the use of observable market data, namely the contract exchange rate and the
bank’s forward rate. The derivatives are therefore categorised as level 2 using the fair value hierarchy.
The Group utilises currency derivatives to hedge significant future transactions and cash flows. The Group is a party to
foreign currency forward contracts in the management of its exchange rate exposures. The instruments purchased are
primarily denominated in the currencies of the Group’s principal markets.
Derivatives that do not qualify for hedge accounting are accounted for as trading instruments and any change in their
fair value determined as the mark-to-market value at the statement of financial position date is recognised in the income
statement. No derivatives qualified for hedge accounting during the year (2020: none).
At the reporting date, the total notional amount of outstanding forward foreign exchange contracts that the Group had
committed is as below and their related fair value was as follows (terms not exceeding three months from 31 January 2020):
2021
2020
Group
£’000
£’000
Forward foreign exchange contracts – notional amount
—
454
Financial liability
—
(39)
Financial statements
157
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
24 Financial instruments continued
e) Forward contracts continued
2021
2020
Company
£’000
£’000
Forward foreign exchange contracts – notional amount
—
454
Financial liability
—
(39)
Changes in the fair value of derivative financial instruments amounting to £39,000 have been credited to the Group
income statement in the year (2020: charge of £31,000).
Changes in the fair value of derivative financial instruments amounting to £39,000 have been credited to the Company
income statement in the year (2020: charge of £31,000).
f) Capital risk management
The Group’s (and by implication the Company’s) objectives when managing capital are to safeguard the Group’s ability
to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders. This will
guide the Group’s decisions in relation to dividends and whether to raise additional funds required through debt or
equity. There is no formal policy nor target regarding the gearing ratio.
The Group’s primary tool in managing risk is cash flow analysis. In addition to strategic cash flow management the Group
performs frequent cash flow modelling.
The schedule of matters reserved for Board decision includes approval of any financial instruments or bank borrowings
in excess of £2,000,000.
The capital structure of the Group consists of net debt (borrowings and other long-term liabilities disclosed in note 18 –
Cash, borrowing and net cash, after deducting non-JetCard cash and bank balances) and equity of the Group
(comprising issued capital, reserves and retained earnings disclosed in notes 28 to 31).
The Group is not subject to any externally imposed capital requirements. The Group is subject to covenant testing in
relation to its borrowing. The Group is compliant with these at the year end and they are factored into any assessment
of going concern.
Excluding JetCard cash the Group’s gearing ratio at year end is as follows:
2021
2020
£’000
£’000
Debt
—
(11,500)
Cash and cash equivalents
9,916
4,633
Net cash/(net debt)
9,916
(6,867)
Equity
21,082
9,193
Net cash/(net debt) to equity ratio
47.04%
(74.70%)
Debt is defined as long and short-term borrowings and other long-term liabilities as detailed in note 18 – Cash, borrowing
and net cash.
Equity includes all share capital and reserves of the Group that are managed as capital.
g) Financial assets by category
2021
2020
Group
£’000
£’000
Cash and bank balances
27,721
21,375
Trade and other receivables and accrued income
7,502
11,467
Current assets which are not financial assets
3,222
7,652
Total current assets
38,445
40,494
Financial statements
158
Air Partner plc | Annual Report 2021
24 Financial instruments continued
g) Financial assets by category continued
2021
2020
Company
£’000
£’000
Cash and bank balances
17,362
12,128
Trade and other receivables and accrued income
9,186
9,680
Current assets which are not financial assets
1,135
2,825
Total current assets
27,683
24,633
h) Financial liabilities by category
2021
2020
Group
£’000
£’000
Financial liabilities held at fair value through profit or loss
—
(39)
Financial liabilities measured at amortised cost
(32,230)
(30,648)
Current liabilities which are not financial liabilities
(6,102)
(12,555)
Total current liabilities
(38,332)
(43,242)
2021
2020
Company
£’000
£’000
Financial liabilities held at fair value through profit or loss
—
(39)
Financial liabilities measured at amortised cost
(21,179)
(20,612)
Current liabilities which are not financial liabilities
(2,201)
(3,456)
Total current liabilities
(23,380)
(24,107)
2021
2020
Group
£’000
£’000
Financial liabilities measured at amortised cost
(2,051)
(14,342)
Long-term liabilities which are not financial liabilities
(168)
(393)
Total non-current liabilities1
(2,219)
(14,735)
2021
2020
Company
£’000
£’000
Financial liabilities measured at amortised cost
(1,300)
(13,126)
Long-term liabilities which are not financial liabilities
—
(200)
Total non-current liabilities1
(1,300)
(13,326)
1 Total non-current liabilities does not include deferred tax liability.
The Directors consider that the carrying amount of the financial assets and liabilities approximates to their fair value.
25 Share based payments
The Company operates a share option scheme under which options may be granted to certain staff of the Group to
subscribe for ordinary shares in the Company. The scheme rules cover grants under an approved and an unapproved
section of the scheme. The vesting period is three years. With certain exceptions, options are forfeited if an employee
leaves the Group and outstanding options expire if they remain unexercised after a period of 4 to 10 years from the
date of grant.
Financial statements
159
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
25 Share based payments continued
Details of the share options outstanding during the year are as follows:
2021
2020
Weighted
Weighted
average
average
Number
exercise
Number
exercise
of share
price
of share
price
options
(pence)
options
(pence)
Outstanding as at start of year
1,336,759
7.2
1,731,678
6.1
Granted during the year
1,700,636
—
870,475
—
Forfeited/lapsed during the year
(265,448)
16.3
(525,577)
17.7
Exercised during the year
(113,336)
4.2
(739,817)
3.0
Outstanding at year end
2,658,611
1.8
1,336,759
7.2
Exercisable at year end
87,500
55.5
254,410
37.9
The weighted average remaining contractual life of share options outstanding at the year end was 2.13 years
(2020: 1.81 years).
The exercise prices of share options outstanding at year end ranged from nil pence to 55.5 pence (2020: nil pence to
63.4 pence). The total charge for the year relating to employee share based payment plans was £451,000 (2020: £59,000).
The following table shows the number of shares within ranges of exercise price:
2021
2020
Cash which
Cash which
may be
may be
received
received
Number
upon
Number
upon
of share
exercise
of share
exercise
options
£’000
options
£’000
Nil pence
2,571,111
—
1,173,259
—
From 55.0 pence to 65.0 pence
87,500
49
163,500
96
Total
2,658,611
49
1,336,759
96
In the current year, options were granted on 11 August 2020. The estimated fair value of the options granted on those
dates is £1,196,293. In the prior year, options were granted on 11 July 2019. The estimated fair value of the options
granted on those dates is £565,809. Inputs into the Monte Carlo model were as follows:
2020
2019
options
options
Weighted average share price
0.89p
0.80p
Weighted average exercise price
0.00p
0.00p
Expected volatility
77.00%
45.00%
Expected life
3 years
3 years
Risk-free rate
0.04%
0.55%
Discount for lack of marketability1
24.00%
n/a
Expected dividend yields
n/a
n/a
1 Discount for lack of marketability is in relation to a mandatory holding period for any share received from the exercise of options.
The discount is only applicable for options for the Directors.
Expected volatility was determined by calculating the historical volatility of the Group’s share price over the previous
three years.
26 Deferred tax
Deferred tax has been calculated at 19% (2020: 17%) in respect of UK companies and at the prevailing tax rates for the
overseas subsidiaries. The following are the major deferred tax liabilities and assets recognised by the Group and the
Company with movements thereon during the current and prior reporting periods.
Financial statements
160
Air Partner plc | Annual Report 2021
26 Deferred tax continued
IFRS 3
Net accelerated
Share based
Other temporary
intangibles
tax depreciation
payment
differences
Total
Group
£’000
£’000
£’000
£’000
£’000
At 31 January 2019
(685)
(87)
126
311
(335)
Arising on acquisition
(1,275)
44
—
19
(1,212)
Transition to IFRS 16
—
28
—
—
28
Credit/(charge) to the income statement
134
(47)
(80)
(20)
(13)
Exchange differences
—
—
—
(3)
(3)
At 31 January 2020
(1,826)
(62)
46
307
(1,535)
IFRS 16 adjustment1
—
—
—
5
5
Credit/(charge) to the income statement
257
(79)
51
509
738
Exchange differences
—
—
—
(19)
(19)
At 31 January 2021
(1,569)
(141)
97
802
(811)
1 Adjustment to reflect movement on finalisation of adjustments in UK subsidiaries.
Net accelerated
Share based
Other temporary
tax depreciation
payment
differences
Total
Company
£’000
£’000
£’000
£’000
At 1 February 2019
(90)
150
—
60
Recognised on conversion to IFRS 16
10
—
—
10
(Credit)/charge to the income statement
(62)
(104)
58
(108)
At 31 January 2020
(142)
46
58
(38)
Credit to the income statement
26
44
10
80
At 31 January 2021
(116)
90
68
42
Deferred tax assets and liabilities are offset where the Group has a legally enforceable right to do so. The following
is the analysis of the deferred tax balances for financial reporting purposes:
Group
Company
2021
2020
2021
2020
£’000
£’000
£’000
£’000
Deferred tax liabilities
(1,511)
(1,819)
—
(38)
Deferred tax assets
700
284
42
—
(811)
(1,535)
42
(38)
Group
Company
2021
2020
2021
2020
£’000
£’000
£’000
£’000
Deferred tax assets to be recovered after more than 12 months
128
165
90
88
Deferred tax assets to be recovered within 12 months
804
292
68
16
932
457
158
104
Deferred tax liabilities to be recovered after more than 12 months
(1,232)
(1,455)
(116)
(142)
Deferred tax liabilities to be recovered within 12 months
(511)
(537)
—
—
(1,743)
(1,992)
(116)
(142)
Deferred tax liability net
(811)
(1,535)
42
(38)
The ageing analysis grosses up deferred tax balances within entities to reflect the expected timing of recognition
and therefore the Group has not offset assets and liabilities where the Group has a legally enforceable right to do so.
At the statement of financial position date the Group had undistributed earnings in respect of overseas subsidiaries
that would be subject to overseas withholding taxes on remission to the UK. No liability has been recognised in
respect of these earnings because the Group is in a position to control the timing of the reversal of the temporary
differences and it is probable that such differences will not reverse in the foreseeable future.
Financial statements
161
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
26 Deferred tax continued
At the statement of financial position date the Group had unused tax losses of £4.4m (2020: £2.7m) resulting in a potential
deferred tax asset of £1,394,000 (2020: £769,000). The Group has not recognised £1,394,000 (2020: £761,000) of
this asset as it is not expected that the losses will be used in the foreseeable future.
In the Spring Budget 2021, the government announced that from 1 April 2023 the corporation tax rate will increase
to 25.0%. As the proposal to increase the rate to 25% had not been substantively enacted at the balance sheet date, its
effects are not included in these financial statements.
27 Employee benefits
In the UK, the Company operates a defined contribution retirement benefit scheme for all qualifying employees. The
assets of the scheme are held in individual personal pension schemes which are fully transferable if the employee leaves
the Company.
Similar schemes operate across the rest of the Group depending on local regulations and individual social contribution
levels. The amount of expense related to such pension contributions is disclosed in note 8.
In other subsidiaries, the employees are members of state-managed retirement funds operated by respective
governments, with contributions payable being a specified percentage of payroll costs. The only obligation of the
Group with respect to the retirement benefit scheme is to make the specified contributions. The total cost charged
of £662,000 (2020: £730,000) represents contributions payable to these various schemes by the Group. As at the
statement of financial position date the Group owed £149,000 (2020: £93,000) to pension schemes.
Air Partner International S.A.S. operates a defined benefit pension scheme. The French pension system is operated on
a 'pay as you go' basis. Each employee is entitled to receive a basic complementary pension through monthly payroll
social security deductions from the defined contribution schemes ARRCO and AGIRC (AGIRC being solely for
management) as well as a complementary pension through AG2R La Mondiale. When the employee retires, the
company will have no further liability to the employee.
All permanent employees are covered by this scheme. The official retirement age in France is 62; however, the full
pension benefit may not be available at this age. Benefit rights do not vest before the normal retirement age.
Before 70 years of age, the employer may request the employee to retire but cannot in any way oblige them to do so.
On the other hand, when the employee has reached the age of 70, the employer can unilaterally decide to retire them.
Retirement in this case is then considered initiated by the employer.
If it is deemed that the employee’s retirement is not the employee’s choice, then a lump sum retirement allowance
must by law be paid by the employer when the employee retires.
In this case, the lump sum allowances to be paid on retirement are calculated as follows:
‣ 25% of the base salary by years of seniority until 10 years; and
‣ 33% of the base salary by years of seniority from the 11th year.
If it is deemed that the employee’s retirement is the employee’s decision, the lump sum allowance must by law be paid
by the employer when employee retires:
‣ 50% of 1 month's salary after 10 years of seniority;
‣ 1 month's salary after 15 years;
‣ 1.5 months' salary after 20 years; and
‣ 2 months' salary after 30 years.
The salary to be considered to calculate the compensation is according to the formulas below; the most advantageous
result for the employee is to be applied:
‣ 1/12th of the gross remuneration of the last 12 months preceding your retirement; or
‣ 1/3rd of the last 3 months (in this case, any bonus or other element of annual or exceptional salary paid to the
employee during this period is recalculated over 3 months).
Financial statements
162
Air Partner plc | Annual Report 2021
27 Employee benefits continued
The Group recognises a provision for retirement assuming voluntary retirement by the employee with additional
calculation assumptions as per below:
Defined benefit pension
The risks of the scheme are as follows:
a) Changes in bond yields
A decrease in corporate bond yields will increase plan liabilities.
b) Life expectancy
The external scheme’s obligation is to provide benefits for the life of the member, so increases in life expectancy will
result in an increase in the plan’s liabilities and the company’s payments required on retirement. The risk is limited due
to the low number of people remaining in the scheme.
c) Inflation risk
The pension obligations are linked to inflation, and higher inflation will lead to higher liabilities.
A comprehensive actuarial valuation of the company pension scheme, using the projected unit basis, was carried out
at 31 January 2018 by an independent consulting actuary. In the absence of the 31 January 2020 actuarial report,
pension liability has been based on the assumptions below and updated for the movements in employees during the
year. The valuations at these dates are based on the following assumptions:
2021
2020
Expected rate of salary increases
2.0%
2.0%
Discount rate
0.40%
0.77%
Rate of inflation
1.50%
1.50%
Retirement age – management
65–67
65–67
Retirement age – others
65–67
65–67
Annual staff turnover rates in both years are as follows:
2021
2020
All ages
10.32%
4.76%
Reconciliation of scheme liabilities:
2021
2020
£’000
£’000
At 1 February
44
127
Current service credit
(25)
(83)
At 31 January
19
44
The sensitivity of the defined benefit obligation to changes in the principal assumption is:
Impact on defined benefit obligation
Increase in
Decrease in
2021
assumption
assumption
More leavers than new joiners
Yes
—
Increase in
Decrease in
2020
assumption
assumption
More leavers than new joiners
—
Yes
Financial statements
163
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
27 Employee benefits continued
Defined benefit pension continued
c) Inflation risk continued
Impact on defined benefit obligation continued
Total cost recognised as an expense:
2021
2020
£’000
£’000
Current service credit – within administrative expenses
25
83
28 Share capital
2021
2020
£’000
£’000
Authorised
Unlimited ordinary shares of 1 pence each1
—
—
Issued and fully paid
63,562,601 ordinary shares of 1 pence each
636
—
53,525,293 ordinary shares of 1 pence each
—
535
1 At the AGM on 26 June 2019, the Company’s shareholders approved that the restriction on authorised share capital be revoked
and deleted.
The Company has one class of ordinary shares which carries no right to fixed income and entitles holders to one vote
per share at general meetings of the Company.
In June 2020, the Group completed a cash box placing for 10,037,308 new ordinary shares of 1 pence each in the
capital of Air Partner plc, the Company. The cash box placing allowed the Group to quickly issue shares by bypassing
the pre-emption requirements required for the issue of shares, provided they are issued for a non-cash consideration.
This was achieved through the use of shares in a subsidiary company created specifically for the cash box placing. The
placing price was 75p per share. The placing raised gross funds of £7,527,981 incurring fees of £475,789, resulting in a
net increase in equity of £7,052,192.
In accordance with section 612 of the Companies Act 2006, merger relief has been applied resulting in an increase to
retained earnings of £6,895,576. The remainder of the increase in equity comes from:
‣ share capital of £100,373; and
‣ share premium of £56,243, which relates to an offer through PrimaryBid as part of the placing. Share issued through
this offer did not qualify for merger relief.
29 Share premium account
Group and
Company
£’000
Balance at 1 February 2019
4,814
Issue of shares
593
Exercise of share options
488
Balance at 31 January 2020
5,895
Issue of shares (see note 28)
56
Balance at 31 January 2021
5,951
Financial statements
164
Air Partner plc | Annual Report 2021
30 Merger reserve
Group and
Company
£’000
Balance at 1 February 2020
295
Issue of shares
6,895
Redemption of shares
(6,895)
Balance at 31 January 2021
295
The opening and closing merger reserve represents the fair value of the consideration given in excess of the nominal
value of the ordinary shares issued as part of the acquisition consideration for Cabot Aviation Services Limited.
Movements within the reserve during the year relate to the cash box placing for 10,037,308 shares. See note 28 – Share
capital for further detail.
31 Own shares reserve
Group and
Company
£’000
Balance at 1 February 2019
(326)
Disposed on exercise of options
168
Balance at 31 January 2020
(158)
Disposed on exercise of options
91
Balance at 31 January 2021
(67)
The own shares reserve represents the cost of shares in Air Partner plc purchased in the market and held by the
Air Partner Employee Benefit Trust, which was established to satisfy the future exercise of options under the Group’s
share option schemes (see note 25 – Share based payments). The number of ordinary shares held by the Air Partner
Employee Benefit Trust at 31 January 2021 was 47,502 ordinary shares of 1 pence each (2020: 69,928 ordinary shares of
1 pence each). At 31 January 2020 a further 90,910 ordinary shares of 1 pence each were held by the Trust in a nominee
capacity for one beneficiary of the Trust. No further shares were held at 31 January 2021. The cost of the shares in the
own share reserve represents the total cost of both the ordinary shares held by the Air Partner Employee Benefit Trust
and those held by the Trust in a nominee capacity.
32 Prior year acquisition of subsidiaries
On 12 December 2019, Air Partner plc acquired 100% of the issued share capital of Redline Worldwide Limited ('Redline'),
obtaining control of the company and its subsidiaries (Redline Aviation Security Limited, Redline Assured Security Limited
and Redline Assured Security SARL) on that date.
The headline price was £10.0m, on a debt free, cash free basis, with an initial consideration of £8.0m, comprised of
cash of £7.4m and shares of £600,000, payable on completion and additional consideration of up to £2.0m payable
over two years post completion. £1.0m of the deferred consideration was paid during the current year. The remaining
balance is conditional. The Group holds a liability for the full £1.0m as of 31 January 2021.
No revisions have been made to the fair value of net assets acquired during the year.
Established in 2006, Redline is a global leader in the delivery of government-standard security training and solutions
to international airports, airlines and aviation sector related companies, critical national infrastructure, stadia and event
managers, and corporates. The products and services provided include: training – academy and e-Learning; quality
assurance – covert testing and audits; compliance management – embedded Security Management Systems (SeMS)
and security health monitoring software; and security consulting – design and development of security systems,
processes and protocols.
The acquisition of Redline adds specialist consulting expertise and knowledge to Air Partner as well as offering
significant growth opportunities and furthering the Group’s relationships with airports, airlines, governments and
corporates around the world.
Financial statements
165
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
32 Prior year acquisition of subsidiaries continued
The net assets of Redline, including intangible assets recognised on acquisition, were £7,634,000. The total consideration
including adjustments for working capital and net cash was £11,728,000, resulting in goodwill of £3,644,000, attributable
to the value of the assembled workforce and the ability of the senior staff to generate future business. No goodwill is
deductible for tax purposes.
Redline contributed revenue of £5,859,000 and profit before tax of £298,000 during the current year (FY20: revenue
of £978,000 and profit before tax of £195,000, being the results between the date of acquisition and 31 January 2020).
If the acquisition of Redline had been completed on the first day of the previous financial year, it would have contributed
£7,530,000 to Group revenue and £830,000 to Group profit before tax.
Acquisition-related costs (included in other items in the previous year) amounted to £604,000 covering adviser fees,
legal fees and external financial and tax due diligence.
33a Net cash inflow from operating activities
Group
Company
2021
2020
2021
2020
£’000
£’000
£’000
£’000
Profit for the year
Continuing operations
5,632
303
8,093
1,974
Adjustments for:
Finance income
(29)
(71)
(2)
(3)
Finance expense
522
613
317
362
Income tax
2,747
633
943
751
Depreciation, amortisation and profit/loss on disposal
4,888
6,830
1,142
1,119
Impairments
81
1,885
—
1,050
Fair value movement on derivative financial instruments
(39)
31
(39)
31
Share option cost for year
451
59
339
59
Share based payments
—
58
—
58
Increase/(decrease) in provisions
42
(643)
(1)
(173)
Foreign exchange differences
(1,388)
88
(555)
407
Operating cash flows before movements in working capital
12,907
9,786
10,237
5,635
Change in receivables
9,945
1,582
2,210
4,388
Change in payables
(3,436)
(2,259)
947
(5,494)
Cash generated from operations
19,416
9,109
13,394
4,529
Cash generated from operations is stated net of a cash outflow at the Group level of £625,000 (FY20: £734,000)
relating to exceptional items.
Cash generated from operations is stated net of a cash outflow at the Company level of £251,000 (FY20: £705,000)
relating to exceptional items.
Financial statements
166
Air Partner plc | Annual Report 2021
33b Net cash/(debt) reconciliation
This section sets out an analysis of net cash/(debt) and the movements in net cash/(debt) for each of the periods presented.
Group
At
At
1 February
Cash flow
Foreign
31 January
2020
Additions
Disposals movements
Interest
exchange
2021
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Cash
21,375
—
—
5,887
—
459
27,721
Debt
(11,500)
—
—
11,500
—
—
—
Lease liabilities
(7,308)
(277)
357
1,831
(214)
(258)
(5,869)
Net cash
2,567
(277)
357
19,218
(214)
201
21,852
At
At
1 February Adoption of Acquired on
Cash flow
Foreign
31 January
2019
IFRS 16
acquisition
Additions movements
Interest
exchange
2020
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Cash
25,154
—
—
—
(3,020)
—
(759)
21,375
Debt
(5,500)
—
—
—
(6,000)
—
—
(11,500)
Lease liabilities
—
(11,760)
(1,065)
(188)
5,715
(301)
291
(7,308)
Net cash
19,654
(11,760)
(1,065)
(188)
(3,305)
(301)
(468)
2,567
Company
At
At
1 February
Cash flow
Foreign
31 January
2020
Additions movements
Interest
exchange
2021
£’000
£’000
£’000
£’000
£’000
£’000
Cash
12,128
—
4,679
—
555
17,362
Debt
(11,500)
—
11,500
—
—
—
Lease liabilities
(1,271)
(75)
724
(33)
—
(655)
Net (debt)/cash
(643)
(75)
16,903
(33)
555
16,707
At
At
1 February Adoption of
Cash flow
Foreign
31 January
2019
IFRS 16 movements
Interest
exchange
2020
£’000
£’000
£’000
£’000
£’000
£’000
Cash
15,736
—
(3,201)
—
(407)
12,128
Debt
(5,500)
—
(6,000)
—
—
(11,500)
Lease liabilities
—
(1,938)
720
(53)
—
(1,271)
Net cash/(debt)
10,236
(1,938)
(8,481)
(53)
(407)
(643)
Financial statements
167
Air Partner plc | Annual Report 2021
Notes to the financial statements continued
for the year ended 31 January 2021
34 Short-term and low value lease commitments
All leases included within this note fall outside of the scope of IFRS 16, either due to low value or the lease being for
less than 12 months.
2021
2020
Land and
Land and
2021
2020
2021
2020
buildings
buildings
Other
Other
Total
Total
The Group as lessee
£’000
£’000
£’000
£’000
£’000
£’000
Minimum lease payments under operating leases
recognised as costs for the year
61
213
3
13
64
226
At the reporting date, the Group had outstanding commitments for future minimum lease payments under non‑cancellable
operating leases, which fall due as follows:
2021
2020
Land and
Land and
2021
2020
2021
2020
buildings
buildings
Other
Other
Total
Total
The Group as lessee
£’000
£’000
£’000
£’000
£’000
£’000
Within one year
11
27
2
2
13
29
In the second to fifth year inclusive
—
2
3
—
3
2
After five years
—
—
—
—
—
—
11
29
5
2
16
31
Operating lease payments represent rentals payable by the Group for certain office properties, motor vehicles and
office equipment it uses. Leases are negotiated in isolation, dependent on the trading conditions in the country concerned.
35 Government grants
Government grants of £43,000 (2020: £nil) relating to lost income in France resulting from COVID-19 are included
in other operating income. There are no unfulfilled conditions or other contingencies attached to these grants.
During the year the Group utilised the Coronavirus Job Retention Scheme implemented by the government of the
United Kingdom, where those employees designated as being 'furloughed workers' are eligible to have 80% of their
wage costs paid up to a maximum amount of £2,500 per month. The Group utilised similar schemes provided
by governments in France, Germany, Austria, Italy and the United States. The total amount of such relief received was
£1,703,000, which has been offset against the relevant staff costs in the accounts. There are no unfulfilled conditions
or other contingencies attaching to these grants.
36 Profit for the financial year
The Group financial statements do not include a separate income statement for Air Partner plc (the parent undertaking)
as permitted by Section 408 of the Companies Act 2006. The parent company profit after tax for the financial year was
£8,093,000 (2020: £1,974,000) including dividends from subsidiary companies of £3,876,000 (2020: £592,000). The
parent company had no other comprehensive income during the year (2020: other comprehensive loss of £51,000
resulting from the adoption of IFRS 16).
Financial statements
168
Air Partner plc | Annual Report 2021
37 Related party transactions
The Company had the following transactions with related parties in the ordinary course of business during the year
under review.
2021
2020
Trading transactions
£’000
£’000
Subsidiaries
Sales to subsidiaries
—
—
Purchases from subsidiaries
—
—
Amounts owed by subsidiaries at year end
7,278
5,756
Amounts owed to subsidiaries at year end
(5,883)
(3,745)
Outstanding balances that relate to trading balances are placed on inter-company accounts with no specific credit period.
2021
2020
Compensation of key management personnel (being the Executive Directors)
£’000
£’000
Short-term employee benefits
955
512
Post-employment benefits1
54
62
Share based payments
191
19
1,200
593
In addition to the above amounts, key management personnel who were also shareholders received £6,668 of
dividends in respect of their shareholdings in the year ended 31 January 2021 (2020: £37,655).
The Board of Directors’ remuneration in accordance with Schedule 5 of the Accounting Regulations was as follows:
2021
2020
Aggregate Directors’ remuneration
£’000
£’000
Emoluments
1,116
1,045
Company contributions to money purchase pension contributions1
54
62
1,170
1,107
1 Due to an administrative error in the prior year, pension contributions were overpaid by £3,479. The full amount was repaid during the
current year. This has been included in the payments above but not in the Directors’ remuneration for the year ended 31 January 2020.
Two Directors (2020: two Directors) were members of money purchase pension schemes during the year.
Further information about the remuneration of individual Directors is provided in the audited part of the Directors’
remuneration report on pages 89 to 96.
38 Contingent liabilities
The Company’s banker holds a free and floating charge over the Company’s assets resulting from the revolving credit
facility held by the Company.
Financial statements
169
Air Partner plc | Annual Report 2021
THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION
If you are in any doubt as to what action to take, we recommend you seek advice from your stockbroker, solicitor,
accountant or other appropriate independent professional adviser authorised under the Financial Services and
Markets Act 2000 without delay. If you have sold or otherwise transferred all your shares in the Company, please
forward this document to the person through whom the sale or transfer was effected, for transmission to the
purchaser or transferee.
Annual General Meeting (AGM) to be held at 12.30 pm on Thursday 8 July 2021
at 2 City Place, Beehive Ring Road, Gatwick, West Sussex RH6 0PA
We are keen to welcome shareholders in person to our 2021 Annual General Meeting this year, particularly given the
constraints we faced in 2020 due to the COVID-19 pandemic.
At present, we anticipate it will be possible under proposed UK government measures for shareholders to attend
the 2021 Annual General Meeting at 12.30 pm on Thursday 8 July 2021 at 2 City Place, Beehive Ring Road, Gatwick,
West Sussex RH6 0PA and we will welcome the maximum number of shareholders we are able within safety
constraints and in accordance with government guidelines. However, given the constantly evolving nature of the
situation, we want to ensure that we are able to adapt these arrangements efficiently to respond to changes in
circumstances. On this basis, should the situation change such that we consider that it is no longer possible for
shareholders to attend the meeting, we will announce any changes to the meeting (such as timing or venue) as soon
as practicably possible via the Regulatory News Service and the Company's website (www.airpartnergroup.com).
Attendance at the meeting
Shareholders intending to attend the Annual General Meeting, should this be possible, are asked to register their intention
as soon as practicable with the Company registrars at Link Group at PXS 1, Central Square, 29 Wellington Street,
Leeds LS1 4DL.
Proxies
Given the uncertainty around whether shareholders will be able to attend the Annual General Meeting, because of
tighter restrictions due to a change in the situation with the COVID-19 pandemic, we encourage all shareholders to
either complete and return a proxy form (see notes 4 and 5 opposite); register their proxy appointment electronically
(see note 6 opposite); or if they hold shares in CREST, register their proxy appointment by utilising the CREST electronic
proxy appointment service (see notes 7 to 14 (inclusive) on pages 171 to 173) appointing Ed Warner, the Chair of the
meeting, as their proxy. This will ensure that your vote will be counted if ultimately you are not able to attend the
meeting. In order for a proxy appointment to be valid your electronic vote or proxy form must be completed and
received by Link Group at PXS 1, Central Square, 29 Wellington Street, Leeds LS1 4DL, by 12.30 on Tuesday 6 July 2021
or, in the case of an adjourned meeting, not less than 48 hours (excluding non‑business days) before the time appointed
for holding such adjourned meeting.
Notice of Annual General Meeting
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Shareholder information
Notice is hereby given that the 2021 Annual General Meeting of the Company will be held at 12:30 pm on Thursday
8 July 2021 at 2 City Place, Beehive Ring Road, Gatwick, West Sussex RH6 0PA for the transaction of the following business.
At the AGM we will be proposing a number of resolutions as set out below. Resolutions 1 to 11 will be proposed as
ordinary resolutions, and resolutions 12 to 15 will be proposed as special resolutions:
Ordinary resolutions
Annual Report and Accounts
1.
To receive the Company’s audited financial statements and the Auditors' and Directors’ reports for the year ended
31 January 2021.
Directors’ remuneration
2. To approve the Directors’ remuneration report in the form set out in the Company’s Annual Report and Accounts,
excluding the summary of the Directors' remuneration policy set out on pages 84 to 89 of the Directors'
remuneration report, for the year ended 31 January 2021.
Dividend
3. That the final dividend recommended by the Directors of 1.6p per ordinary share for the financial year ended
31 January 2021 be declared payable on 15 July 2021 to all members whose names appear on the Company's
register of members on 11 June 2021.
Directors
4. To re-elect Mark Briffa as a Director of the Company.
5. To re-elect Joanne Estell as a Director of the Company.
6. To re-elect Ed Warner as a Director of the Company.
7. To re-elect Amanda Wills as a Director of the Company.
8. To re-elect Paul Dollman as a Director of the Company.
Auditors
9. To reappoint PricewaterhouseCoopers LLP as the Company’s auditors to hold office from the conclusion of this
AGM until the conclusion of the next AGM at which accounts are laid before the Company.
10. To authorise the Audit and Risk Committee of the Board of Directors of the Company (the Board) to determine
the remuneration of the Company's auditors.
Directors’ authority to allot shares
11. To generally and unconditionally authorise the Board pursuant to and in accordance with Section 551 of the
Companies Act 2006 (the Act), in substitution for all previous authorities to the extent unused, to exercise all the
powers of the Company to allot shares in the Company and to grant rights to subscribe for or to convert any
security into shares in the Company:
a) up to an aggregate nominal amount of £211,875; and
b) comprising equity securities (as defined in Section 560(1) of the Act) up to a further aggregate nominal value
of £211,875 in connection with an offer by way of a rights issue,
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Ordinary resolutions continued
Directors’ authority to allot shares continued
such authorities to expire at the conclusion of the next AGM of the Company to be held in 2022 or, if earlier, at
12.30 pm on 8 October 2022 (unless previously renewed, varied or revoked by the Company at a general meeting),
save that the Company may before such expiry make an offer or agreement which would or might require shares to
be allotted or rights to subscribe for or convert any security into shares to be granted after the authority ends and
the Directors may allot such securities in pursuance of that offer or agreement as if the power conferred by this
resolution has not expired.
For the purposes of this resolution, ‘rights issue’ means an offer to:
a) ordinary shareholders in proportion (as nearly as may be practicable) to their existing holdings; and
b) holders of other equity securities if this is required by the rights of those securities or, if the Directors consider
it necessary, as permitted by the rights of those securities,
to subscribe for further securities by means of the issue of a renounceable letter (or other negotiable document)
which may be traded for a period before payment for the securities is due, but subject in both cases to such exclusions
or other arrangements as the Directors consider necessary or appropriate in relation to treasury shares, fractional
entitlements, record dates or legal, regulatory or practical problems in, or under the laws of, any territory.
Special resolutions
Disapplication of pre-emption rights
12. That if resolution 11 is passed, the Board, in substitution for all previous authorities to the extent unused, be
authorised to allot equity securities (as defined in the Act) for cash under the authority given by that resolution
and/or to sell ordinary shares held by the Company as treasury shares for cash as if Section 561 of the Act did not
apply to any such allotment or sale, such authority to be limited:
a) to allotments for rights issues and other pre-emptive issues; and
b) to the allotment of equity securities or sale of treasury shares (otherwise than under paragraph (a) above) up to
a nominal amount of £31,781,
such authority to expire at the conclusion of the next AGM of the Company to be held in 2022 or, if earlier, at
12.30 pm on 8 October 2022 but, in each case, prior to its expiry the Company may make offers, and enter into
agreements, which would, or might, require equity securities to be allotted (and treasury shares to be sold) after
the authority expires and the Board may allot equity securities (and sell treasury shares) under any such offer or
agreement as if the authority had not expired.
13. That if resolution 11 is passed, the Board, in substitution for all previous authorities to the extent unused, be
authorised in addition to any authority granted under resolution 12 to allot equity securities (as defined in the Act) for
cash under the authority given by that resolution and/or to sell ordinary shares held by the Company as treasury
shares for cash as if Section 561 of the Act did not apply to any such allotment or sale, such authority to be:
a) limited to the allotment of equity securities or sale of treasury shares up to a nominal amount of £31,781; and
b) used only for the purposes of financing (or refinancing, if the authority is to be used within six months after the
original transaction) a transaction which the Directors determine to be an acquisition or other capital investment
of a kind contemplated by the Statement of Principles on Disapplying Pre-Emption Rights most recently
published by the Pre-Emption Group prior to the date of the Notice of this AGM,
such authority to expire at the conclusion of the next AGM of the Company to be held in 2022 or, if earlier, at
12.30 pm on 8 October 2022 save that, in each case, the Company may before such expiry make offers, and enter
into agreements, which would, or might, require equity securities to be allotted (and treasury shares to be sold)
after the authority expires and the Board may allot equity securities (and sell treasury shares) under any such offer
or agreement as if the authority had not expired.
Notice of Annual General Meeting continued
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Special resolutions continued
Purchase of own shares
14. That the Company be generally and unconditionally authorised for the purpose of Section 701 of the Act to make
market purchases (as defined in Section 693 of the Act) of ordinary shares of 1p each in the capital of the Company
(ordinary shares) provided that:
a) the maximum number of ordinary shares hereby authorised to be purchased is 6,356,260 (being approximately
10% of the issued ordinary share capital of the Company);
b) the minimum price (exclusive of expenses) which may be paid for such ordinary shares is 1p per share, being
the nominal amount thereof;
c) the maximum price (exclusive of expenses) which may be paid for such ordinary shares shall be an amount
equal to the higher of: (i) 5% above the average of the middle market quotations for such shares taken from the
London Stock Exchange Daily Official List for the five business days immediately preceding the day on which
the purchase is made; and (ii) the higher of the price of the last independent trade of an ordinary share and the
highest current independent bid for an ordinary share as derived from the London Stock Exchange Trading
System (SETS); and
d) the authority hereby conferred shall (unless previously renewed or revoked) expire at the conclusion of the
next AGM of the Company to be held in 2022 (or, if earlier, at 12.30 pm on 8 October 2022), save that the
Company may before such expiry make a contract or agreement to make a market purchase of its own ordinary
shares which will or may be executed wholly or partly after the expiry of such authority and the Company may
purchase such shares as if the authority conferred hereby had not expired.
Notice of general meetings
15. That a general meeting of the Company other than an AGM may be called on not less than 14 clear days’ notice,
provided that the authority granted pursuant to this resolution 15 shall expire at the conclusion of the next AGM of
the Company to be held in 2022.
By order of the Board
Judith Banks
Company Secretary
Air Partner plc
11 May 2021
Registered office:
2 City Place
Beehive Ring Road
Gatwick
West Sussex RH6 0PA
Registered in England and Wales
Registration number 00980675
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Please read the following notes and the explanation of the resolutions before deciding how to vote.
Notes
As explained on the first page of this Notice (page 170), shareholders and any proxy appointed by them may not be
permitted to attend the AGM should public health guidance and legislation issued by the UK Government in response
to the outbreak of COVID-19 prevent it. On that basis, shareholders are requested to appoint the Chair of the meeting
to be his/her proxy at the meeting, to ensure that should the circumstances arise where no shareholders other than
the minimum number of shareholders required to ensure that the meeting is quorate may be permitted to attend the
meeting, shareholders can be sure of voting.
Entitlement to attend and vote
1.
Pursuant to Regulation 41 of the Uncertificated Securities Regulations 2001 (as amended) and Section 360B(2)
of the Companies Act 2006 (the Act), only those shareholders registered in the register of members of the
Company at close of business on 6 July 2021 (or, in the event of any adjournment, at close of business on the day
which is two days prior to the adjourned meeting) shall be entitled to attend and vote at the AGM. Changes to the
register of members after the relevant deadline shall be disregarded in determining the rights of any person to
attend and vote at the meeting.
Appointment of proxies
2. Subject to the precautionary note at the beginning of this page, a shareholder entitled to attend and vote at the
meeting may appoint one or more proxies to exercise all or any of the member’s rights to attend, speak and vote
at the meeting. A proxy need not be a member of the Company but must attend the meeting for the member’s vote
to be counted. If a member appoints more than one proxy to attend the meeting, each proxy must be appointed to
exercise the rights attached to a different share or shares held by the member. If a member wishes to appoint more
than one proxy they may do so at www.signalshares.com. Appointment of a proxy does not preclude you from
attending and voting at the meeting in person. However, if you do so, the proxy previously appointed will not also
be able to attend, speak or vote on your behalf.
3. Shareholders can:
appoint a proxy and give proxy instructions by returning a proxy form (see notes 4 and 5 below);
register their proxy appointment electronically (see note 6 below); or
if they hold shares in CREST, register their proxy appointment by utilising the CREST electronic proxy
appointment service (see notes 7 to 14 (inclusive) opposite).
4. A paper proxy form can be requested from the registrars, as explained in note 26 on page 177. To be valid
any proxy form or other instrument appointing a proxy must be received by post or (during normal business
hours only) by hand at Link Group, PXS 1, Central Square, 29 Wellington Street, Leeds LS1 4DL, or by email:
enquiries@linkgroup.co.uk by 12.30 pm on 6 July 2021 (or, in the event of any adjournment, 48 hours before
the time fixed for the adjourned meeting).
5. In the case of a shareholder which is a corporation, the proxy form must be executed by a duly authorised person
or under its common seal or in any other manner authorised by its constitution. The power of attorney or authority
(if any) should be returned with the proxy form.
6. Shareholders may appoint a proxy electronically by visiting www.signalshares.com. To be valid, your proxy
appointment and instructions should reach the Company’s registrars by 12.30 pm on 6 July 2021 (or, in the event
of any adjournment, 48 hours before the time fixed for the adjourned meeting). By registering on the Signal Shares
portal at www.signalshares.com, you can manage your shareholding, including:
cast your vote;
change your dividend payment instruction;
update your address; and
select your communication preference.
Notice of Annual General Meeting continued
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Notes continued
Appointment of proxies continued
7. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service
may do so for the meeting and any adjournment(s) thereof by using the procedures described in the CREST Manual.
CREST personal members or other CREST sponsored members, and those CREST members who have appointed
a service provider(s), should refer to their CREST sponsor or voting service provider(s), who will be able to take
the appropriate action on their behalf.
8. In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST
message (a CREST proxy instruction) must be properly authenticated in accordance with Euroclear UK & Ireland
Limited’s specifications, and must contain the information required for such instruction, as described in the CREST
Manual (available via www.euroclear.com/CREST). The message, regardless of whether it relates to the appointment
of a proxy, or is an amendment to the instruction given for a previously appointed proxy, must, in order to be valid, be
transmitted so as to be received by Link Group (ID: RA10) by 12.30 pm on 6 July 2021 or, if the meeting is adjourned,
48 hours before the time fixed for the adjourned meeting. For this purpose, the time of receipt will be taken to be
the time (as determined by the time stamp applied to the message by the CREST Application Host) from which
Link Group is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST. After this
time, any change of instructions to proxies appointed through CREST should be communicated to the appointee
through other means.
9. CREST members and, where applicable, their CREST sponsors or voting service providers should note that
Euroclear UK & Ireland Limited does not make available special procedures in CREST for any particular message.
Normal system timings and limitations will, therefore, apply in relation to the input of CREST Proxy Instructions. It
is the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal member
or sponsored member, or has appointed a voting service provider, to procure that his CREST sponsor or voting
service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by means of
the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST
sponsors or voting system providers are referred, in particular, to those sections of the CREST Manual concerning
practical limitations of the CREST system and timings (www.euroclear.com/CREST).
10. The Company may treat as invalid a CREST proxy instruction in the circumstances set out in regulation 35(5)(a)
of the Uncertificated Securities Regulations 2001 (as amended).
11. Shareholders may use the proxy form or electronic proxy voting arrangements to vote in one of three ways: ‘for’,
‘against’ or ‘vote withheld’. Please note that a ‘vote withheld’ has no legal effect and will count neither for or
against a resolution when proxy votes are counted on each resolution.
12. If no voting indication is given, the proxy will vote or abstain from voting at his or her discretion. The proxy will
vote (or abstain from voting) as he or she thinks fit in relation to any other matter which is put before the AGM.
13. You can change your proxy instructions by submitting a new proxy appointment using the methods set out above.
Note that the cut-off time for receipt of proxy appointments also applies in relation to amended instructions; any
amended proxy appointment received after the relevant cut-off time has passed will be disregarded. If you submit
more than one valid proxy appointment, the latest valid appointment received before the cut-off time for the
receipt of proxies will take precedence.
14. An electronic proxy appointment may be revoked completely by sending an authenticated CREST message or
by accessing your account at www.signalshares.com and instructing the removal of your proxy vote. In the case
of written proxy instructions submitted on a proxy form, you will need to inform the Company by sending a signed
written statement, clearly stating your intention to revoke your proxy appointment to Link Group, PXS 1, Central Square,
29 Wellington Street, Leeds LS1 4DL. Any revocation notice must be received by Link Group no later than 12.30 pm
on 6 July 2021.
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Notes continued
Nominated persons
15. The right to appoint a proxy does not extend to a ‘nominated person’, that is, someone to whom this Notice is sent
because they have been nominated to enjoy information rights, under Section 146 of the Act. A nominated person
may have a right to be appointed (or to have someone else appointed) as a proxy entitled to attend, speak and
vote at the AGM, under an agreement between him/her and the member who nominated him/her.
16. If a nominated person does not have a right to be appointed, or to have someone else appointed, as a proxy, or
does not wish to exercise such a right, he or she may still have the right, under an agreement between him/herself
and the member who nominated him/her, to give instructions to the member as to the exercise of voting rights.
Nominated persons should contact the member who nominated them for further information on these matters.
Corporate representatives
17. Any corporation which is a shareholder can appoint one or more corporate representatives who may exercise on
its behalf all of its powers as a member provided that they do not do so in relation to the same shares. Such
representative(s) should deliver to the Company at the AGM a certified copy of the resolution authorising him and
her or them before exercising such powers.
Right to ask questions
In line with the AGM arrangements in the context of the COVID-19 pandemic on page 170, we anticipate that
shareholders will be entitled to attend the AGM in person. The following note on the right to ask questions is only
applicable if shareholders have not been notified that they cannot attend the AGM.
18. All members and all proxies attending the meeting have the right to ask questions relating to the business of the
meeting and to have those questions answered unless:
a) answering the question would interfere unduly with the preparation for the meeting or involve the disclosure of
confidential information; or
b) the answer has already been given on a website in the form of an answer to a question; or
c) it is undesirable in the interests of the Company or the good order of the meeting that the question
be answered.
Total voting rights
19. As at 11 May 2021, being the last practicable day before publication of this Notice, the Company’s issued share
capital was 63,562,601 ordinary shares of 1p each, each carrying one vote. The total number of voting rights in the
Company as at 11 May 2021 is therefore 63,562,601.
Voting on a poll
20. Voting on all resolutions will be conducted by way of a poll rather than on a show of hands. Calling a poll on each
resolution allows all proxy votes cast to be counted and reported.
Joint shareholdings
21. In the case of a joint shareholding, the vote of the first named holder shown on the register of members, whether
tendered in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holders.
Documents on display
22. Copies of Executive Directors’ service contracts and Non-executive Directors’ letters of appointment will be
available for inspection at the Company’s registered office during usual business hours on any weekday (Saturdays,
Sundays and public holidays excluded) from the date of this Notice until the conclusion of the AGM and will also be
available at the place of the AGM for inspection for at least 15 minutes prior to and during the meeting itself. Should
UK Government restrictions prevent this, different arrangements will be made and announced.
Information available on website
23. Copies of this Notice, the Annual Report and all information required by Section 311A of the Act, together with
details of any members’ statements, members’ resolutions and members’ items of business received after the date
of this Notice and required to be published on a website by Section 527 of the Act, will be published on the Company's
website (www.airpartnergroup.com).
Notice of Annual General Meeting continued
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Notes continued
Members' rights
24. Members representing 5% or more of the total voting rights of all the members or at least 100 persons (being either
members who have a right to vote at the meeting and hold shares on which there has been paid up an average sum,
per member, of £100 or persons satisfying the requirements set out in Section 153(2) of the Act) may:
a) require the Company, under Section 338 of the Act, to give notice of a resolution which may properly be moved
at the meeting. Any such request, which must comply with Section 338(4) of the Act, must be received by the
Company no later than six weeks before the date fixed for the meeting;
b) require the Company, under Section 338A of the Act, to include a matter (other than a proposed resolution) in
the business to be dealt with at the meeting. Any such request, which must comply with Section 338A(3) of the
Act, must be received by the Company no later than six weeks before the date fixed for the meeting; and
c) require the Company, under Section 527 of the Act, to publish on a website a statement setting out any matter
relating to: (i) the audit of the Company’s accounts (including the Independent auditors' report and the
conduct of the audit) that are to be laid before the AGM; or (ii) any circumstance connected with auditors of
the Company ceasing to hold office since the previous meeting at which annual accounts and reports were laid
in accordance with Section 437 of the Act. The business which may be dealt with at the AGM includes any
statement that the Company has been required to publish on a website under Section 527 of the Act.
Communications
25. You may not use any electronic address provided either in this Notice or in any related documents (including
the shareholder letter and proxy form) to communicate with the Company for any purposes other than those
expressly stated.
26. If you need help with voting online, or require a paper proxy form, please contact our registrars, Link Group, by
email at enquiries@linkgroup.co.uk, or you may call Link on +44 (0)371 664 0300. Calls are charged at the
standard geographic rate and will vary by provider. Calls outside the United Kingdom will be charged at the
applicable international rate. Link Group is open between 09.00 – 17.30, Monday to Friday excluding public holidays in
England and Wales. Submission of a proxy vote shall not preclude a member from attending and voting in person
at the meeting in respect of which the proxy is appointed or at any adjournment thereof.
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Resolution 1 – Annual Report and Accounts
For each financial year, the Directors are required by the Act to present the Annual Report and Accounts, comprising
audited financial statements, the Independent auditors' report, the Strategic report, the Directors’ report and the
Directors’ remuneration report, to shareholders at a general meeting. This is an ordinary resolution to receive the
Annual Report and Accounts for the year ended 31 January 2021.
Resolution 2 – Directors’ remuneration
In accordance with the Act, the Company proposes resolution 2 as an ordinary resolution to approve the Directors’
remuneration report, excluding the summary of the Directors’ remuneration policy set out on pages 84 to 89 of the
Directors’ remuneration report, for the financial year ended 31 January 2021. The Directors’ remuneration report is set
out on pages 81 to 96 of the Annual Report and Accounts. The vote on this resolution is advisory only and the
Directors’ entitlement to remuneration is not conditional on its being passed.
Resolution 3 – Dividend
We announced the reinstatement of dividends at the interim results in September 2020 with a payment of 0.8 pence
per share. The Board is now recommending a final dividend of 1.6 pence per share, making a total of 2.4 pence per
share for the year ended 31 January 2021. If approved, the final dividend will be paid on 15 July 2021 to shareholders
on the register as at 11 June 2021.
Resolutions 4 to 8 – Directors
In accordance with the 2018 UK Corporate Governance Code (Code), all Directors shall be subject to annual election
by shareholders and accordingly all Directors are submitting themselves for re-election by shareholders.
Each of resolutions 4 to 8 shall be proposed as an ordinary resolution. The Board believes that each Director brings
considerable and wide-ranging skills and experience which the Board considers will continue to contribute to the
Company’s long-term sustainable success, and valuable contribution to the deliberations of the Board. Each Director
has continued to perform effectively and demonstrate commitment to their role. The Board has no hesitation in
recommending the re-election of the Directors to shareholders. In making these recommendations, the Board confirms
that it has given careful consideration to the Board’s balance of skills, knowledge and experience and is satisfied that
each of the Directors putting themselves forward for re-election has sufficient time to discharge their duties
effectively, taking into account their other commitments.
The Board has reviewed the independence of its Directors and taken into consideration the guidance provided in the
Code. Accordingly, the Board considers Ed Warner, Amanda Wills and Paul Dollman to be independent in accordance
with provision 10 of the Code.
The biographies of the Directors who are seeking re-election are included in the Annual Report and Accounts on
page 71.
Explanation of the resolutions to be proposed at the AGM
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Resolutions 9 and 10 – Auditors
The Company is required to appoint auditors at every general meeting of the Company at which accounts are
presented to shareholders. The current appointment of PricewaterhouseCoopers LLP as the Company's auditors will end
at the conclusion of the AGM. The Audit and Risk Committee has reviewed PricewaterhouseCoopers LLP’s performance
as auditors of the Company during the year and has recommended to the Board that they be reappointed. The Board is
careful that the auditors' independence should not be compromised and the Audit and Risk Committee takes responsibility
for reviewing the performance of the auditors and making recommendations about the scope of their work and fee
proposals. PricewaterhouseCoopers LLP have indicated that they are willing to continue as the Company’s auditors
for another year. Accordingly, resolution 9 proposes the reappointment by members of PricewaterhouseCoopers LLP
as auditors of the Company until the conclusion of the Company’s AGM in 2022.
Resolution 10 requests authority for the Audit and Risk Committee of the Board to determine the remuneration of
the auditors.
Resolution 11 – Directors’ authority to allot shares
The authority of shareholders is required to enable Directors to allot shares. The authority conferred on the Directors
at the general meeting of the Company held on 15 July 2020 to allot shares or grant rights to subscribe for or to convert
any securities into shares in the Company expires at the conclusion of the forthcoming AGM. This ordinary resolution
seeks authority for the Directors to allot shares or grant rights to subscribe for or convert securities into shares.
Resolution 11(a) seeks to grant the Directors authority to allot, pursuant to Section 551 of the Act, shares and grant
rights to subscribe for or to convert any security into shares in the Company up to a maximum nominal amount of
£211,875. This represents 21,187,534 ordinary shares of 1p each, which is approximately one third of the Company’s
issued ordinary share capital as at 11 May 2021 (being the latest practicable date prior to the publication of this Notice).
In accordance with The Investment Association’s Share Capital Management Guidelines (the Guidelines),
Resolution 11(b) seeks to grant the Directors authority to allot ordinary shares in connection with a rights issue in
favour of ordinary shareholders up to an aggregate nominal value of £211,875 (representing 21,187,534 ordinary shares
of 1p each). This amount represents a further one third of the Company’s issued ordinary share capital as at 11 May 2021
(being the latest practicable date prior to the publication of this Notice).
The authorities sought under paragraphs (a) and (b) of this resolution will expire at the conclusion of the AGM of
the Company to be held in 2022, or at 12.30 pm on 8 October 2022, whichever is sooner. The Directors have no present
intention of exercising either of the authorities under this resolution other than to allot shares pursuant to the Company’s
share schemes in the ordinary course, but the Board wishes to ensure that the Company has maximum flexibility in
managing the financial resources of the Company.
As at the date of this Notice, no shares are held by the Company in treasury.
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Resolutions 12 and 13 – Disapplication of pre-emption rights
Resolutions 12 and 13 will be proposed as special resolutions seeking to renew the authority of the Directors to allot
new shares or other equity securities pursuant to the authority given by resolution 11, or sell treasury shares, for cash
without the shares or other equity securities first being offered to shareholders in proportion to their existing holdings.
The authority granted under resolution 12 shall only be used in connection with a pre-emptive offer, or otherwise up to
an aggregate nominal amount of £31,781, being approximately 5% of the total issued ordinary share capital of the
Company (excluding treasury shares) as at 11 May 2021.
In addition to the authority provided by resolution 12 the Pre-Emption Group's Statement of Principles supports the
annual disapplication of pre-emption rights in respect of allotments of shares and other equity securities (and sales
of treasury shares for cash) representing no more than an additional 5% of issued ordinary share capital (exclusive of
treasury shares), to be used only in connection with an acquisition or specified capital investment. The Pre-Emption
Group’s Statement of Principles defines ‘specified capital investment’ as meaning one or more specific capital investment
related use for the proceeds of an issuance of equity securities, in respect of which sufficient information regarding
the effect of the transaction on the Company, the assets the subject of the transaction and (where appropriate) the
profits attributable to them is made available to shareholders to enable them to reach an assessment of the
potential return.
Accordingly, and in line with the template resolutions published by the Pre-Emption Group, resolution 13 seeks to
authorise the Directors to allot new shares and other equity securities pursuant to the authority given by resolution 11,
or sell treasury shares, for cash up to a further nominal amount of £31,781, being approximately 5% of the total issued
ordinary share capital of the Company as at 11 May 2021, only in connection with an acquisition or specified capital
investment which is announced contemporaneously with the allotment or sale, or which has taken place in the
preceding six-month period and is disclosed in the announcement of the allotment or sale.
If these resolutions are passed, the authorities will expire at the end of the conclusion of the next AGM of the Company
to be held in 2022 or at 12.30 pm on 8 October 2022, whichever is the earlier. The Board considers the authorities in
resolutions 12 and 13 to be appropriate in order to allow the Company flexibility to finance business opportunities or
to conduct a rights issue or other pre-emptive offer without the need to comply with the strict requirements of the
statutory pre-emption provisions. The Board does not intend to issue more than 7.5% of the issued share capital of
the Company for cash on a non-pre-emptive basis in any rolling three-year period (other than in connection with an
acquisition or specified capital investment as described in the Pre-Emption Group’s Statement of Principles) without
prior consultation with shareholders.
Explanation of the resolutions to be proposed at the AGM continued
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Resolution 14 – Purchase of own shares
Resolution 14 will also be proposed as a special resolution and seeks authority for the Company to make market
purchases of its own ordinary shares up to a limit of approximately 10% of the issued ordinary share capital as at
11 May 2021, being 6,356,260 ordinary shares. The authority requested would replace a similar authority granted last
year and would expire at the end of the next AGM of the Company to be held in 2022 or at 12.30 pm on 8 October 2022,
whichever is the earlier.
The resolution sets the minimum and maximum amounts which may be paid for such shares. This authority would only
be exercised if the Directors considered that there was likely to be a beneficial impact on earnings per share and that
it would be in the best interests of the Company as a whole. Shares purchased would either be held as treasury shares
or would be cancelled. Treasury shares can be resold for cash, cancelled or used for the purposes of employee share
schemes. No dividends are paid on shares whilst held in treasury and no voting rights attach to treasury shares. The
Directors believe that it is desirable for the Company to have this choice as holding the purchased shares as treasury
shares would give the Company the ability to resell or transfer them in the future and so provide the Company with
additional flexibility in the management of its capital base. It is the Company’s current intention to satisfy the
requirements of its share schemes either by acquiring shares in the market or, subject to institutional guidelines,
issuing new shares or using shares held in treasury.
No shares were repurchased and cancelled during the period 1 February 2020 to 31 January 2021. Options to subscribe
for 2,658,611 ordinary shares were outstanding under the Company’s share schemes as at 31 January 2021, representing
4.2% of the issued ordinary share capital at that date. If the authority given by this resolution 14 were to be fully used,
the options currently in issue would then represent 4.6% of the issued ordinary share capital of the Company.
Resolution 15 – Notice of general meetings
Resolution 15 is an annual permission request for general meetings, other than the AGM, to be called on 14 clear days’
notice. There is no current intention to hold such a meeting but the Directors wish to retain the ability to call a meeting
on shorter notice if the circumstances should require it. The Companies (Shareholders’ Rights) Regulations 2009
specify that approval must be sought from shareholders by special resolution at an annual or subsequent general
meeting and the Company would need to make a means of electronic voting available to all shareholders for any
general meeting called on less than 21 clear days’ notice. If passed, the resolution would remain valid until the
conclusion of the next AGM of the Company to be held in 2022.
Voting
The Company intends to call a poll on all resolutions. This means that the votes of all shareholders, including the
majority of our shareholders who (even in usual circumstances) cannot attend the meeting but who submit a proxy
form, can be counted. This year, against a background of ongoing COVID-19 uncertainties, please complete and return
your proxy appointment as soon as possible as described in the notes above.
Recommendation
The Directors consider the proposed resolutions set out in this Notice to be in the best interests of the Company and
shareholders as a whole and unanimously recommend that shareholders should vote in favour of all the resolutions.
Air Partner plc
2 City Place
Beehive Ring Road
Gatwick
West Sussex RH6 0PA
+44 (0)1293 844 800
www.airpartnergroup.com
Shareholder information
181
Air Partner plc | Annual Report 2021
Air Partner plc is registered in England and Wales,
no. 980675. VAT registration no. GB 771 9226 12
Head Office
Air Partner plc
2 City Place
Beehive Ring Road
Gatwick
West Sussex RH6 0PA
Company Secretary
01293 844838
cosec@airpartner.com
Broker
Canaccord Genuity Limited
88 Wood Street
London EC2V 7QR
Auditors
PwC
The Portland Building
25 High Street
Crawley, Gatwick
West Sussex RH10 1BG
Bankers
NatWest Bank plc
16 The Boulevard
Crawley
West Sussex RH10 1XU
Financial PR adviser
TB Cardew
5 Chancery Lane
London EC4A 1BL
Email: airpartner@tbcardew.com
Share registrars
Link Group
Shareholder enquiries
Telephone: 0371 664 0300
(Calls are charged at the standard geographic rate and
will vary by provider. Calls outside the United Kingdom
will be charged at the applicable international rate.
Lines are open between 09:00 – 17:30, Monday to Friday
excluding public holidays in England and Wales.)
Link Group
PXS 1
Central Square
29 Wellington Street
Leeds
LS1 4DL
Email: enquiries@linkgroup.co.uk
Company information
Shareholder information
182
Air Partner plc | Annual Report 2021
CBP006954
Air Partner plc’s commitment to environmental issues is reflected in this Annual Report
which has been printed on Arcoprint, an FSC® certified material.
This document was printed by Pureprint Group using its environmental print technology
with 99% of dry waste diverting from landfill, minimising the impact of printing on the
environment. The printer is a CarbonNeutral® company.
Both the printer and the paper mill are registered to ISO 14001.
Air Partner plc
2 City Place
Beehive Ring Road
Gatwick
West Sussex
RH6 0PA
+44 (0)1293 844 800