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August 5 (Reuters) – BBA Aviation Plc announced a decline in profit in the first half of the month, due to lower jet traffic at European and US airports, as well as rising costs.
The aeronautical service provider agreed last week to sell its Ontic aircraft parts and service unit for $ 1.37 billion, leaving its Signature unit, which provides a range of services including pbadenger handling, aircraft refueling and ground handling.
The total revenue of this unit increased by 23%, thanks to the acquisition of the EPIC fueling services company. However, FBO Signature sales, which account for the majority of the unit's revenues, decreased 1% to $ 897.1 million due to lower fuel prices and currency fluctuations.
BBA also highlighted the difficulties badociated with the intense jet and charter traffic, which affected the FBO's operations, but said the overall performance for the first half of the year was broadly in line with its expectations.
"The company uses the dreaded term" wholesale "as expected to describe the numbers, a code for not quite up to the mark," said Russ Mold, chief investment officer at AJ Bell.
Shares of BBA, a member of the FTSE 250, lost up to 6% in the wake of Monday's general market weakness.
Europe's aviation sector has faced higher fuel costs, fierce competition among low-cost airlines, a slowing economy and the impact of the Boeing 737 MAX grounding .
BBA reported underlying earnings before tax of $ 150.2 million for the six months ended June, compared to $ 153.1 million a year ago.
The company's net debt almost doubled to $ 2.54 billion as at June 30 from the previous year due to changes in accounting standards. (Report of Pushkala Aripaka in Bengaluru, edited by Gopakumar Warrier and Anil D'Silva)
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