Google Finance
Filing
Jan. 04, 2017
2016 Q3 Data, Year End Nov. 30
Current Price: $0.20
1.Basic Information
(1) History
The company was IPOd at 1997 using reverse merger. At that time it only has $600k in revenue. Lee Heitman seems the main share holder(51%) and CEO until 2010. His share changed to 17% at 2009. At 2010 Ian A. McDougall took control of the company with 45% of shares.
(2) Business related:
The company is a private Jet management company which manage private corporate jet and provide air charter services.
Currently around $10m in annual real revenue which include $6m from aircraft management. $4m from charter services. Both have around just 10% gross margin. Also there are some $3m+ maintenance fees included in revenue but those are very thin profit revenue which should be just ignored. Before Ian took over the company, the maintenance seems very profitable but after that it was just passed through revenue which is subcontracted to Ian's another company Mx Aerospace.
The aircraft management revenue seems very stable because it is based on aircraft numbers. While charter services fluctuate quite a bit since it is related to the usage of the aircraft.
It manages 12 jets plus 2 helicopters. Using 2015 data of $6.4m in aircraft manage revenue. It should charge around $500k/jet in service.
Back at 2010, its aircraft revenue is around $5m. Indicate that it might manage 10 jets. Since last quarter of 2011, it seems lost at least 2 to 3 jets work. This continues to Q1 2014 while the company seems added at least 4 to 5 jets under management. Since then the finance getting much better.
The company doesn't own any properties. The book value of its assets is only $60k. The 5 year rental seems ends at Sept. 2016.
Flight Solutions & Services Mx Aerospace: Maintenance, fuel company All the maintenance revenue was pass through to this company. 1/4 of service expense from this company.
UYJ Aviation: Charter service, around 1/4 expense is from this company.
All 3 companies controlled by Ian and it share the same hanger with PJT.
(3) Management.
(4) Debt and Credit facility.
No debt. Around $900k in cash.
(5) Insider holding, options, Insider trading info, share buy back.
(7) Auditor
(8) Industry comparison.
The industry is very fragmented but most are private companies I think.
3. Valuation
The company generates around $1.3m in gross profit at last two years and has around $600k in SG&A so net income is close to $600k. However, first 3Q of 2016 is much worse which only generated $180k in income. Looking carefully, it was not that bad. In Q1, there are $60k one time stock option expense, In Q3, there is a $40k expense in marketing. Also there are $40k in currency loss. The real decrease might be just $100k in gross margin.
Currently the book value is also $0.20/share. The number of aircraft it managed wasn't change so the aircraft management revenue of $6m is quite stable and the profit from it should be more than enough to cover total cost. Unless the number of aircraft it manage changes, the company should be able to stay profitable.
In a normal case, it should be able to generate $350k annual income comfortably. Using 10 P/E ratio, it support close to $0.40/share price.
4. Risk
(1) The major risk is the it lost contract to any aircraft, since main of its cost are pretty fixed. That would easily make it unprofitable just like what had happened from 2011 to 2013.
(2) The air charter activity is also fluctuate quite a bit. But in a long run, any corporate who own should use quite some each year, otherwise it is not worth to own one.
(3) The company needs to re-rent its current place in Q4 2016. The rental might goes up.
5. Conclusion
This is just a fair managed company. But current price is quite cheap unless the company lose major customers. Need to monitor closely.
(4) Debt and Credit facility.
No debt. Around $900k in cash.
(5) Insider holding, options, Insider trading info, share buy back.
Ian holds 4.1m shares. 45%.
Michael W Herman: holds 1.8m shares. 20%. He is a Sudbury person. Maybe just a private investor.
The company granted 450k options at $0.40 on 2016. They expire at Feb. 2021.
(6) Employee numbers
Michael W Herman: holds 1.8m shares. 20%. He is a Sudbury person. Maybe just a private investor.
The company granted 450k options at $0.40 on 2016. They expire at Feb. 2021.
(6) Employee numbers
(7) Auditor
(8) Industry comparison.
The industry is very fragmented but most are private companies I think.
(9) Major events
2. Financial data.3. Valuation
The company generates around $1.3m in gross profit at last two years and has around $600k in SG&A so net income is close to $600k. However, first 3Q of 2016 is much worse which only generated $180k in income. Looking carefully, it was not that bad. In Q1, there are $60k one time stock option expense, In Q3, there is a $40k expense in marketing. Also there are $40k in currency loss. The real decrease might be just $100k in gross margin.
Currently the book value is also $0.20/share. The number of aircraft it managed wasn't change so the aircraft management revenue of $6m is quite stable and the profit from it should be more than enough to cover total cost. Unless the number of aircraft it manage changes, the company should be able to stay profitable.
In a normal case, it should be able to generate $350k annual income comfortably. Using 10 P/E ratio, it support close to $0.40/share price.
4. Risk
(1) The major risk is the it lost contract to any aircraft, since main of its cost are pretty fixed. That would easily make it unprofitable just like what had happened from 2011 to 2013.
(2) The air charter activity is also fluctuate quite a bit. But in a long run, any corporate who own should use quite some each year, otherwise it is not worth to own one.
(3) The company needs to re-rent its current place in Q4 2016. The rental might goes up.
5. Conclusion
This is just a fair managed company. But current price is quite cheap unless the company lose major customers. Need to monitor closely.
6.Links
http://theaviationhomeoffice.com/team/ian-mcdougall/
July 28, 2017
Current Price: $0.20. Market Cap $1.8m.
(1) The first Q2 of 2017 actually was very good with 290K net income. Now the book value is $2.1m.
(2) If not much change, it can generate around $450 to $500k annual revenue easily. Which is over $0.05/share.
(3) Since the options expires at early 2021. There are still 3.5 years left. The management has strong incentive to bring up the share price to over $0.40/share before they expires.
(4) Currently the company doesn't issue press release. They only submit filing to SEDAR system.
http://theaviationhomeoffice.com/team/ian-mcdougall/
July 28, 2017
Current Price: $0.20. Market Cap $1.8m.
(1) The first Q2 of 2017 actually was very good with 290K net income. Now the book value is $2.1m.
(2) If not much change, it can generate around $450 to $500k annual revenue easily. Which is over $0.05/share.
(3) Since the options expires at early 2021. There are still 3.5 years left. The management has strong incentive to bring up the share price to over $0.40/share before they expires.
(4) Currently the company doesn't issue press release. They only submit filing to SEDAR system.
