Wednesday, July 24th, 2019

United Technologies’ profits exceed expectation through MAX grounding

With over 300 of the Boeing 737 MAX jets grounded worldwide, United Technologies has seen an increase in demand for its aircraft maintenance parts and services for airlines’ other aircraft and, as a consequence, has raised its full-year sales and profit forecast.

It is one of the first companies to openly signal that it has made gains on the back of the 737 MAX problems, with shares rising as much as 2.7% in morning trade after the announcement. “There is impetus on the airlines and the (maintenance and repair) shops to ensure that the existing fleet is in a ready-to-fly state,” United Technologies Chief Financial Officer Akhil Johri told Reuters news agency, talking about the MAX grounding. “In that environment, the shops and the airlines are ensuring that they have the parts supply available and that is definitely helping .” United Technologies also announced that sales in its Collins aerospace unit, which makes engine components, landing gear, wheels and brakes, and interior and exterior aircraft lighting, rose approximately by 66% to US$6.58 billion in the second quarter. Johri added that growth in the unit will slow down in the second half of the year as stocking of spare parts by airlines and shops eases with the likelihood of the 737 MAX returning to the skies.

United Technology said it anticipates its acquisition of Rockwell Collins will add an extra US$150 million in sales and 15 cents per share to its profit in 2019. UTC reported earnings per share of US$2.20 for the quarter ended June 30, beating the average analyst estimate of US$2.05, based on IBES data from Refinitiv.


MTU Maintenance signs V2500 contract with JetBlue Airways

MTU Maintenance and long-term partner JetBlue Airways have signed an exclusive 13-year contract for the airline’s V2500 pre-select fleet. The contract covers maintenance, repair and overhaul for the engines from 2020 to 2033. This contract takes MTU Maintenance’s total contract wins to US$4.5 billion for the first seven months of 2019.

JetBlue Airways, New York’s Hometown Airline™, is a low-cost carrier that operates 1,000 flights daily and serves more than 100 destinations across the US, Latin America and the Caribbean with plans to start flying to Europe in 2021.

Heston MRO launches Component Services

Heston MRO, an independent MRO organization in Australasia, has launched Component and Material services.

As part of its updated strategy to evolve into a Total Technical Care partner for airlines and leasing companies, Heston MRO established a dedicated Components Unit, backed by first investments in stock and future capabilities.

The newly established Components Unit will firstly focus on trading, repair, exchanges, and leasing of Components for local customers in Australasian and South West Pacific region. The service is supported with initial investments into own stock of B737 New Generation components and materials, with planned rapid expansion into A320 and other aircraft platforms. With extensive experience and global partner network at Heston MRO owners level, the company is flexible to promptly scale up the services based on customer needs.

Having started with trading, exchanges, and leasing of components, Heston MRO plans to invest into in-house capabilities for the most frequently removed items within twelve months. This will complement components trading business and will form the base for packaged solutions of flat rate exchanges, fixed price repairs, and Power by the Hour services for regional customers.

With 20 years of operating history and airside presence in Sydney, Melbourne, Brisbane, Perth, Adelaide, and other airports in Australasia, Heston MRO is the largest independent MRO organisation in the region. Besides Line Maintenance and recently launched Components Services, this year the company is adding certification for Engine On-Wing technical capabilities. The resulting Total Technical Care services will be offered to airlines, leasing companies, and OEMs in the Australasian and South West Pacific region.


Robinson opens dedicated overhaul/repair facility

Robinson Helicopter Company has expanded its FAA/EASA approved Repair Station by opening a stand-alone 37,000 ft² facility dedicated to repairs and overhauls. Completed in approximately 18 months, the facility was designed to streamline the repair, inspection, and overhaul process.

As the size of the Robinson fleet (12,000+) grows, the demand for quick repair of parts and
component overhauls increases each year. To maximize efficiency, Robinson organized the new space around the flow of parts. “The goal is to ensure parts are easily accounted for throughout each process and each process is done quickly and efficiently,” stated John Hernandez, Robinson’s Repair Station Manager. Dedicated areas for disassembly and storage of blades, engines, and
components, along with a large media blasting room, a clean room for hydraulic disassembly and ultrasonic cleaning, are all situated in close proximity.

In addition to the steady flow of repair and overhauled parts, Robinson performs helicopter
repairs and overhauls in-house. The new facility is set-up to efficiently tear-down, clean and inspect components, engines and complete aircraft. Once aircraft are disassembled, cleaned and inspected they are brought to the main facility for reassembly, paint, flight test, and delivery.

Jet Parts Engineering

Lockheed Martin reports second quarter 2019 net income of US$1.4 billion

Lockheed Martin has reported second quarter 2019 net sales of US$14.4 billion, compared to US$13.4 billion in the second quarter of 2018. Net earnings in the second quarter of 2019 were US$1.4 billion, or US$5.00 per share, compared to US$1.2 billion, or US$4.05 per share, after severance charges of US$96 million, in the second quarter of 2018. Cash from operations in the second quarter of 2019 was US$1.7 billion, compared to cash used for operations of US$(72) million after pension contributions of US$2.0 billion in the second quarter of 2018.

Aeronautics' net sales in the second quarter of 2019 increased US$229 million, or 4%, compared to the same period in 2018. The increase was primarily attributable to higher net sales of approximately US$205 million for the F-35 program due to increased volume on production, development and sustainment contracts.

Aeronautics' operating profit in the second quarter of 2019 increased $20 million, or 3 percent, compared to the same period in 2018. Operating profit increased approximately $15 million
for the F-35 program due to increased recurring volume on higher margin production contracts, partially offset by lower risk retirements on production and sustainment contracts. Adjustments not related to volume, including net profit booking rate adjustments and other matters, were $25 million lower in the second quarter of 2019 compared to the same period in 2018.

"The corporation achieved another quarter of strong operational and financial results across all four of our businesses, which allowed us to grow our backlog to a new record level and to increase our financial outlook for 2019," said Lockheed Martin Chairman, President and CEO Marillyn Hewson. "Our team remains focused on driving growth, investing in innovative solutions, and creating long-term value for shareholders."


CAVU Aerospace acquires ex-united Boeing 747-400 for dismantle

CAVU Aerospace has acquired a Boeing 747-400 formerly operated by United Airlines.  The aircraft was powered by Pratt & Whitney 4000 engines. 

Bryan Hancock, CAVU Aerospace Founding Partner, mentioned “the demand for B747 material is not fading and securing this material will further help support our customers around the globe.  Furthermore, our CAVUSmartTags™ patented process will allow us to remove and market the material at a more rapid pace.”

GA Telesis

Astronics CSC opens new manufacturing facility in Waukegan, Illinois

Astronics Corporation, a provider of advanced technologies for global aerospace, defense, and other mission critical industries, has reported that its wholly owned subsidiary, Astronics Connectivity Systems and Certifications (CSC), has moved its operations to a new office and manufacturing facility in Waukegan, Illinois.

The new facility enables the expansion of manufacturing capacity and certification services. The facility officially opened on July 18, 2019 . Waukegan is located approximately 20 miles north of Astronics CSC’s Lake Zurich Design Center. Both locations are linked by close proximity to I-94, a major interstate highway.

Astronics CSC serves as one of the global market leaders for inflight entertainment and connectivity (IFEC) solutions for aircraft, specializing in connectivity hardware, integration engineering, and certification services.


Cathay Pacific completes acquisition of Hong Kong Express Airways

Cathay Pacific Airways (Cathay Pacific), the flag-carrying Hong-Kong based airline, has announced it has completed the purchase of low-cost carrier Hong Kong Express Airways. The deal, when announced back in March this year, was for a purchase price of KK$4.93 billion (US$628 million) in the form of HK$2.25 million in cash and the pledge to repay HK$2.68 billion of debt held by HK Express in the form of promissory notes.

Commenting on the purchase, Cathay Pacific Chief Executive Officer and HK Express Chairman Rupert Hogg said: “HK Express will continue to operate as a stand-alone airline using the low-cost carrier business model. I would also like to reassure HK Express customers that there is no change to the airline’s operating model and that business will continue as usual. There will be more value fares and more destinations available to travelers. We look forward to working with the HK Express teams to ensure a smooth transition and to continue to grow the airline in order to better serve its customers.”

Hog added: “Our respective businesses and business models are largely complementary. HK Express captures a unique market segment that, together with the extensive network offered by the Cathay Pacific Group, could multiply connection opportunities through Hong Kong. This will bring tremendous benefits to the travelling public with more choices and greater convenience for their travel experience.” The low-cost carrier will remain a low-cost carrier which serves a niche value market segment.

Component Control

Dominvs Aviation takes flight

London based aviation services company Dominvs Aviation officially launched on the 1st June, providing business aviation asset management solutions, charter and aircraft trading. The company operates as part of the well-established Dominvs Group, a hotels, real estate and private equity business based in central London.

Dominvs Aviation was founded by CEO Chris Mace, previous founder of charter business SaxonAir and well-known to most in the business aviation industry, and Sukhpal Ahluwalia, business entrepreneur and Chairman of Dominvs Group.

Chris Mace says; “Whilst the company’s core focus is aircraft acquisitioning and sales, it also provides a ‘turnkey’ asset management service providing clients with comprehensive aviation solutions; including operations, finance, ownership structure, importation and crewing. These are just a few of the elements that collectively ensure our clients receive the best, safest and most efficient solutions.”

Dominvs Group Chairman, Sukhpal Ahluwalia (left) and Dominvs Aviation CEO, Christopher Mace (right)


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Engine Leasing Seminar
September 17, 2019 – Holiday Inn Kensington High Street, London, UK

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September 18, 2019 – Holiday Inn Kensington High Street, London, UK

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October 30 - 31, 2019 – NEC, Birmingham, UK

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November 26 - 27, 2019 – Hotel Novotel Amsterdam City, Amsterdam, NL