Slattery: Avolon is now in profit

Aviation entrepreneur, Dómhnal Slattery has confirmed that his Dublin-based €4bn Avolon aircraft leasing business is profitable less than two years after launching in 2010.

In an interview, the Co Clare born businessman confirmed: “We’re profitable. We broke even at the back end of 2011.”

Mr Slattery said: “We were loss making in 2011, but broke into profitability as first planned in the first quarter of this year. That was part of the original business plan.

“With these start-up aircraft finance businesses it is practically impossible to make any money in the first two years because of the scale of what you are doing and the costs and so on.”

Providing a mid-year update, Mr Slattery said: “Our total capitalisation is now heading towards $5bn (€4bn). We are a $5bn company so that is a decent metric.”

Avolon’s backers include private equity groups CVC, Cinven and Oak Hill Capital and Mr Slattery said: “Things have grown dramatically. We have 105 aircraft of which 79 aircraft are now delivered and flying around the world.”

He confirmed that the company’s job numbers will increase in Dublin by 10% to 15% this year.

“We continue to grow and we continue to remain committed to Dublin. They are high-quality jobs. We have also opened an office in Dubai as we see increased activity in the Middle East and we want to support that,” he said.

In a previous business venture, Mr Slattery established the firm that became RBS Capital Aviation that was sold earlier this year to Japanese-based Sumitomo Mitsui Corporation for $7.3bn.

Describing the deal as the largest corporate transaction in Irish corporate history, Mr Slattery said: “Personally, as the guy who started that company, it is pleasing to see the full circle.”

The most recent accounts for Avolon show that start-up costs totalling $15.3m contributed to the company recording a loss of $35m in 2010.

At a business aviation conference at Dromoland Castle, Mr Slattery spoke about his high-profile business failure, Jetbird, that was planning to launch a point-to-point jet taxi service for executives in Europe.

The firm ordered 50 Phenom 100 light jets with Brazilian manufacturer, Embraer with an option to purchase a further 50.

Mr Slattery said that from around Sept 2008, “the financial story started to unravel dramatically”.

“One of the best days of my life and perhaps one of the worst was when I went down to Brazil for a pre-delivery flight on the Jetbird aircraft.”

“Clearly, at that time, from Lehman Brothers time on, market demand for business jet travel simply evaporated.”