Aergo: turnover rose but profits halved

PROFITS at an aircraft leasing firm owned by the businessman Denis O’Brien more than halved in 2003, according to accounts just filed at the Companies Registration Office.

Aergo Capital, which was set up by the former Esat Telecom boss, saw its profits fall to $2.15 million in 2003 from $4.7m the previous year.

The company attributed the fall to a difficult time for the airline industry, but said it has managed better than its competitors.

“Lease rate and current market values for aircraft remain depressed, but the company has been successful in keeping its aircraft in lease and the directors expect that lease rates will improve from current levels,” the company said in the accounts.

It added that part of the fall in profits was due to a $3.5m depreciation charge against its aircraft.

The company added that during the year it acquired three new aircraft, bringing its fleet to 28. Aergo said this allowed the company to reduce its exposure to its largest customers from 60% of the total fleet to 54%.

Turnover for the year increased slightly to $33.9m from $33.2m. The bulk of turnover is generated in Europe ($27.2m), with most of this coming from the Italian flag carrier Alitalia. It also leases aircraft to Austrian Airlines and South American carrier Lanchile.

The company had total assets of $152m and retained profits of $10.8m.

Mr O’Brien and his fellow shareholders enjoyed their first dividend from their company, pocketing $1m for the year.

Aergo was set up by Mr O’Brien in 1999 and is based in the same building as many of his other ventures.

The directors of the company are Mr O’Brien, his father Denis Snr, long-time associate Margaret Clandillon, Fred Brown, Liam Barrett and David Sykes. Directors’ pay for the year was up from $405,000 to $531,000

Though best known for netting a €250m fortune from the sale of Esat Telecom to BT in 2000, Mr O’Brien began his career in the aviation industry, having worked for Ryanair founder Tony Ryan at GPA, the biggest aircraft leasing and finance company in Europe, in the early 1990s.

Over the last few years Mr O’Brien has branched out into other businesses. He owns the largest mobile phone operator in the Caribbean, Digicel, and has extensive radio interests in Ireland and the Czech Republic.

Mr O’Brien also invested in golf courses and three years ago acquired European PGA Tour Courses plc to add to his luxury Quinta do Lago estate in Portugal.