The Alliance Aviation Services Ltd (ASX: AQZ) share price has been a positive performer on Thursday morning.
In early trade the contract, charter and allied aviation company's shares are up 2% to $4.44.
This latest gain means the Alliance Aviation share price is now up 67% since this time last year.
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Why is the Alliance Aviation share price surging higher?
Investors have been buying Alliance Aviation shares this morning following the release of its half year update after the market close on Wednesday.
In contrast to the heavy loss expected from Qantas Airways Limited (ASX: QAN) this month, Alliance Aviation delivered a significant increase in profits for the six months ended 31 December.
According to the release, the company reported a 2.3% increase in total revenue to $154.8 million and a 116.8% jump in profit before tax to $33.6 million.
On an underlying basis, profit before tax came in 72.3% higher than the prior corresponding period at $26.7 million. This was in line with the company's half year guidance.
This was driven by growth in higher margin contract and charter flights, which more than offset weaker wet lease and RPT revenues.
Also growing strongly was the company's operating cash flow. It came in at $47.5 million, which was up 225.3% on the same period last year.
At the end of the period, Alliance Aviation had net debt of $6.8 million and a leverage ratio of 0.53.
Alliance's Managing Director, Scott McMillan, commented: "Alliance has achieved a significant number of milestones over the course of the first half of the 2021 financial year. The robustness of our business model, the commitment of our staff and the relationships we have with our clients ensures Alliance will continue to grow the business in future years."
Outlook
No guidance has been provided for the full year but management remains very positive on its outlook.
It commented: "Alliance retains a positive outlook for the 2021 financial year and growth in the 2022 financial year and beyond as the additional aircraft are deployed."
