US aviation firm’s profits dip to $765m

A Shannon-based company engaged in financing aircraft leasing recorded pre-tax profits of $765m (€606m) last year, new figures show.

The pre-tax profit of $765m for the US-owned GE Capital Aviation Funding makes the firm one of the most profitable public and private limited companies in the country.

The figures show pre-tax profits decreased by 15% from $900m to $765m with impairment losses totalling $62m a factor behind the drop in profits in the 12 months to the end of December last.

The accounts also reveal the firm’s profits were hit by lower “other financial income” last year declining from $165.4m to $39.9m.

All of the company’s revenues are generated in Ireland and according to the directors’ report “both the level of business and year end financial position were satisfactory and the directors expect that the present level of activity will be sustained for the foreseeable future”.

The pre-tax profits recorded make the firm more profitable in 2011 than well-known Irish plcs such as the Kerry Group and Ryanair and private limited companies such as Vodafone.

GE Capital Aviation Funding paid $379,000 in corporation tax on its $765m pre-tax profit. The accounts show the firm would have been liable to pay $95.6m in tax at the 12.5% corporation tax rate.

However, the tax bill was reduced through group relief of $98.2m and $3m in non taxable items.

The filings show the firm’s GE aviation subsidiaries are located in France, Sweden, Norway, Netherlands, Malaysia, Bermuda, India, Russia, Mexico, Brazil and the US.

The figures show the firm’s revenue income of $816.9m represents the provision of financing and lending services with all income derived from activities in Ireland. It recorded an operating profit of $806.2m last year.

The company’s $816.6m income was boosted by dividend income of $39m including $24m received from one Shannon-based subsidiary, GECAS Services.

However, interest payable on intercompany balances of $18m reduced the company’s pre-tax profits to $765.3m.

The profits last year resulted in the company having accumulated profits of $5.3bn. In total, the company had shareholder funds of $19.7bn that included a share premium of $14.3bn.

The directors state that “the company’s ability to succeed is dependent on the financial strength of these related group companies, which is in turn dependent on the ability of their customers to both compete effectively in the market place and manage the competitive environment in which they operate”.