24/06/2015: HAIs Financial Results: Positive result after Taxes for the first time since its establishment

Published financial results are an ascertainment of the company’s steadily growing course

June 24, 2015

Positive results after taxes, for the first time in HAI’s course, were presented through the published Annual Report of fiscal year 2014. In particular, net earnings after taxes of € 1,59 mil. are recorded versus losses of € 17,1 mil. in 2013. This is a result achieved by turnover increase and significant decrease of operating and financial expenses. These were the areas where all efforts were focused during the strict implementation of a Strategy for recovery and growth as per the 5-year Business Plan 2014-2018. The company essentially improved operational and production activities, minimized inflexible expenses and applied an aggressive extrovert commercial policy resulting to an apparently positive report for 2014.

More specifically, the company reported significant improvement in financial results:

  • Turnover of fiscal year 2014 reached € 98 mil., which constitutes an 11,1% increase against € 88,2 mil on 2013.
  • The Cost of Sales in 2014 reached € 71,4 mil. – a decrease of 2,5% against the € 73,3 mil. in 2013.
  • As a consequence of the above values, the Gross Profit reached € 26,6 in 2014 against € 15 mil. in 2013 – a significant increase by 77,3%.
  • Essentially improved is the index of Gross Profit, in 2014 is 27,1% while in 2013 was 17%.
  • Last, the Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA) in 2014 reached € 20,5 mil. – higher by 185% compared to € 7,2 of 2013. Similarly, the ratio of EBITDA to Turnover in 2014 was 20,9% compared to the respective 8,2% of 2013.

HAI forecasts that until 2018 will have increased the Turnover by 40% and continuously increasing profitability.

Moreover, it is worth mentioning that within 2014 HAI:

  • Operated at a self-sufficient level – not depending on the Hellenic State.
  • Increased revenue by 12,3%, that is € 94,5 mil. to € 106,1 mil.
  • Further decreased inflexible expenditure by 3%.
  • Decreased debit to the Hellenic State, as the State was retaining 20% before each payment directed to HAI SA.
  • Reactivated HERMES program aiming to conclude this – inactive for more than a decade – program within the second semester of 2015 and to receive 23 mil. euros within 2015.
  • Reactivated – after 3 years of inactivity – the Royal Saudi Air Force engines maintenance program aiming to its implementation until May 2015 and receive 13 mil. euros.
  • Managed through certain systematic actions to pay-off past debts to its suppliers.
  • In the context of control and judicious management achieved, for the first time, to perform an inventory for the total of the company’s stock. The results of this inventory have been incorporated in the fiscal year 2013.

The year2014, the company set as its absolute priority to support the Hellenic Armed Forces, especially the Air Force, through services of high quality standards. Moreover,

  1. Contracted new workload, of high technological value, in C-130 maintenance (Rainbow fitting)
  2. Developed capabilities in Super Puma helicopters maintenance.

In the Commercial sector, the enhancement of extravert orientation in order to attract new partnerships and expand the existing, had as a result the signing, within 2014, of contracts amounting to € 51,7 mil., with € 9,5 mil. corresponding to international customers and € 42,2 mil. to the Hellenic State.

In particular, in 2014 HAI:

  • Signed a new agreement with the Presidential Guard Command of the United Arab Emirates within which HAI provides training services to 112 members of the Presidential Guard for a 3-year period in disciplines of general engineering, electrics, and electronics.
  • Penetrated the markets of India and Poland through two important agreements:
    1. By signing a contract with the Indian company Tata Advanced Systems Ltd (TASL) for manufacturing part of Air-to-air refueling systems for fighter aircraft, and
    2. By signing a contract with the Polish WZL-2 according which, HAI will provide advisory services in terms of know-how transfer for C-130 aircraft maintenance.

In parallel, HAI:

  • Recently signed with the US Company Lockheed Martin a five year extension for C-130J parts manufacturing for the global market, of value amounting to $ 72 mil.
  • Is in the process of re-activating the contract for total support of the Coast Guard fleet for 2015-2018.
  • Expects contract signing for the undertaking of maintenance and upgrade of P-3 aircraft for the Hellenic Navy.

These contracts, valued for over 180 mil. euros, will be added to the backlog of € 520 mil., which is already in process, in HAI.

Moreover, within 2014 several important agreements were signed between HAI and companies of the international aeronautical sector, creating a fertile ground for business activity in the field of UAVs, civil aviation, electronic systems, homeland security, training, etc.

Furthermore, HAI made the most out of the modern facilities and capabilities of 1Source Aeroservices - a joint venture company between HAI and the U.S. Pratt & Whitney - for repair and maintenance of T56 engines control systems and accessories.

And last, HAI broadened the field of accreditations of the affiliated EMC, thus succeeding through focused actions to raise the turnover per 70% (comparing to 2013).

With a significant work-in-process and perspectives derived from the above facts, HAI constitutes for the present and for the future the largest defense and aeronautical industry of the country.

On the occasion of publishing the Annual Report of 2014, the Chief Executive Officer of HAI Mr. Demetrios Papacostas stated: “The positive result after Τaxes constitutes an important milestone in HAI’s course, coinciding with the anniversary of 40 years since the commencement of the company’s operation. It is a result of hard and consistent effort of all the employees, under the guidance of the Management, and confirms the determination of all towards a common vision for the company’s further development”.