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Tag: SAHCO

  • SAHCO’s IPO records 65% subscription

    The initial public offering (IPO) of Skyway Aviation Handling Company (SAHCO) Plc was undersubscribed by 35.35 per cent as the company was only able to raise N1.22 billion out of IPO value of N1.89 billion.

    Official final allotment report for the IPO showed that a total of 1,212 applications were received for 262.52 million ordinary shares of 50 kobo each at N4.65 per share, totaling N1.22 billion.

    SAHCO had floated an IPO of 406.074 million ordinary shares of 50 kobo each at N4.65 per share. The IPO was an offer for sale, implying that the net proceeds of the IPO would go to the existing majority core investor in SAHCO, which was divesting partially to allow retail minority ownerships. Ten per cent of the shares offered for sale were earmarked for staff of SAHCO under an Employee Stock Ownership Plan to be set up and administered by a Trustee.

    The IPO, which opened on November 5, 2018 and was scheduled to close on December 19, 2018, was extended for 12 working days to January 09, 2019 as concerns over valuation and slowdown in the equities market appeared to weaken demand for the shares of the ground handling company.

    SAHCO was privatised by the Federal Government in 2009. Sifax Group acquired the entire share capital of the company. The Share Sale Purchase Agreement (SSPA) however mandates the majority core investor to divest 49 per cent of the shares of the company to the general Nigerian investing public.

    The board of the company had stated that SAHCO planned to ride on the back of the success of its IPO to further push its vision of becoming the leading provider of aviation handling services in the West African region.

    Chairman, Skyway Aviation Handling Company (SAHCO) Plc, Barrister Taiwo Afolabi, said the said the IPO opened up opportunities for Nigerians across the federation to be part of the privatisation success, noting that SAHCO is the leader in aviation cargo and Nigeria’s only ground handling company with affiliation with maritime cargo.

    He outlined that the company’s future strategy is to create long term shareholder value through the profitable operation and expansion of its business into other West African markets with a vision to become the leading provider of passenger, ramp and cargo handling services in the West African region.

    “In order to achieve this objective, SAHCO seeks to pursue growth and opportunities consistent with its business operations by focusing on operational excellence and efficiency, enhanced service delivery, strategic partnerships and alliances that would enhance its capability both in the domestic market and globally as well as strategic investments among others,” Afolabi said.

     

  • SAHCO deploys equipment in Port Hrcourt airport

    Skyway Aviation Handling Company Plc (SAHCO) has deployed a state-of-the-art Ground Support Equipment (GSE) to boost its operations in its Port Harcourt station, its Managing Director, Basil Agboarumi has said in an interview in Lagos.

    According to Agboarumi, the  Ground Support Equipment (GSE) is a high loader Air Marrel (LAM 35). The equipment, he said,  is a 35-ton capacity self-propelled heavy-duty main deck loader that also has the capacity to load and offload containers  which weigh 40 tons.

    The equipment, he added,  offers the most advanced features required by the end user, including a clear deck for the loading and offloading of oversized loads which is also able to operate under severe weather and suitable for use of lower deck to handle pallets.

    The GSE, he said,  can also be used by big aircraft, such as A380 and B777.

    The GSE , he added, was built by Air Marrel, a major ground support manufacturer and exporter of cargo loaders and transporter based in France.

    The equipment, Agboarumi added, was modelled according to specifications of European airlines, who are specialised in cargo operations, is one of the most technologically advanced in today’s market.

    SAHCO, he said, is the most widely spread out ground handling company in Nigeria with presence in all commercially operated airports. Hence, the need to ensure quality deliveries across its stations.

    “With the LAM 35, loading and offloading can be done in record time efficiently, a feat SAHCO is known for.

    “This new GSE, whose capacity is the only one in the country, is a further assurance to clients on safe, speedy and efficient ground handling services. This is also a testament that SAHCO will continue to go to any length to maintain and exceed client expectations.

    “SAHCO   is a Ra3 and IATA Safety Audit  for  Ground Operations  (ISAGO) certified aviation ground handling service provider, offering services in passenger handling, ramp handling, cargohandling/warehousing, training services, aviation security, baggage reconciliation, hospitality/lounge services, and other related ground handling services, in all the commercially operated airports across Nigeria,” he said.

  • SAHCO, Bayelsa sign airport ground handling MoU

    Skyway Aviation Handling Company PLC (SAHCO) has signed a Memorandum of Understanding (MOU) with the Bayelsa State government to be the official ground handling provider in the Bayelsa International Airport.

    SAHCO was chosen to be the only aviation Ground Handling company to cater for passenger handling services, ramp handling, cargo and warehousing amongst other aviation Ground Handling activities in the new airport because of its safe, speedy and efficient services.

    SAHCO has therefore made history as the first aviation Ground Handler to handle airlines in the new International airport which is built to cater for both international and domestic airline operators.

    Skyway Aviation Handling Company PLC, a fully indigenous ground handling company, divested some of its shares to the Nigerian Public in an Initial Public Offer (IPO) concluded on the 9th of January 2019.

    With intense manpower trainings, excellent customer services and investments in state-of-the-art aviation ground handling equipment the company is daily exceeding customer expectations, also with the recent expansion of its operations to Ibadan Airport.

    SAHCO, incorporated as an Aviation Ground Handling Service provider under the Nigerian Companies and Allied Matters Act of 1990, is the reference point to the birth of a successful flight within the Nigerian Aviation Sector, providing services in Passenger Handling, Ramp Handling, Cargo Handling and Warehousing, Aviation Security, Baggage Reconciliation, Crew Bus and Executive Lounge Services and other related Ground Handling Services in all Nigerian commercial airports.

  • SAHCO fetes clients at dinner

    Skyway Aviation Handling Company (SAHCO) Plc has been commended for its consistency in delivering quality service and ensuring professionalism in the discharge of its duties.

    Speaking at the Clients Appreciation Dinner organised in Lagos for its customers including airlines and players in the  cargo sub-sector,its clients  lauded the ground handling company for improving aviation ground handling business in Nigeria and assured the management of their utmost loyalty to the company.

    Mr. Murat Ozcan, Vice President, Ground Operations, Arik Air, in his  comment, said  without SAHCO, the airline would have been in a bad state.

    He explained that the relationship between the airline and the ground handling company was beyond business partnership, stressing that SAHCO stood firmly behind it during its challenging period.

    He also lauded the management for taking the audacious step to be enlisted on the Nigerian Stock Exchange (NSE), describing it as a milestone for the company.

  • SAHCO extends N1.89b IPO amid low demand

    Skyway Aviation Handling Company (SAHCO) Plc has ex-tended its initial public offering (IPO) by 12 working days, as concerns over valuation and slowdown in the equities market appeared to have weakened demand for the shares of the ground handling company.

    SAHCO is offering 406.074 million ordinary shares of 50 kobo each through an IPO at N4.65 per share. The IPO is an offer for sale, implying that the net proceeds will go to the majority core investor, which is divesting partially to allow retail minority ownerships.

    Application list for the N1.89 billion IPO, which was scheduled to close on December 19, 2018, has now been extended till January 09, 2019. The extension of the IPO was approved by the Securities and Exchange Commission (SEC).

    Market sources said the extension might not be unconnected with the perceived low demand for the IPO.

    A receiving agent, who spoke under condition of anonymity, said the demand for the IPO has been modest with investors unwilling to commit to large subscriptions.

    Sources said investors were concerned that the IPO price of N4.65 might be unattractive, considering the depreciation in the stock market and valuations of other related stocks.

    SAHCO was privatised by the Federal Government in 2009. Sifax Group acquired the entire share capital of the firm. The Share Sale Purchase Agreement (SSPA), however, mandates the majority core investor to divest 49 per cent of the shares of the firm to the Nigerian investing public.

    Nigerian Aviation Handling Company (Nahco) Plc, an older and bigger competitor, closed on Monday at N3.37 per share. Nahco has traded in the past one year between a high of N4.90 and a low of N3.18 per share.

    Nahco controls more than two-thirds of the more lucrative international airlines segment of the ground handling market and almost at par with Sahco in local airlines segment. While SAHCO is nimbler, Nahco has more extensive facilities and network with operations in 14 stations and bigger warehouses.

    Market analysts had told The Nation that SAHCO appeared to be carrying a premium that may subject the IPO to peer group pricing pressure, citing other mid-level stocks trading below the offer price.

    An investment analyst, however, said the premium on SAHCO is justifiable as the shares are not commonly available and cannot be subjected to true dynamics of market pricing until when listed.

    A stockbroker with a Lagos-based investment group said the relatively high offer price, expanded shareholders’ base and the fact that the net proceeds of the IPO will not be available for reinvestment in the company may determine the subscription level of the IPO.

    A market analyst noted that investors might be cautious on the post-IPO pricing, citing the recent trend that has seen most share prices falling considerably below recent offer prices.

    Analysts at Cordros Securities Limited, however, said SAHCO has potential to deliver 28.44 per cent capital appreciation of the current price of its IPO and strong potential to sustain growth  in the years ahead, given its exposure to long-term expansion of air traffic, improvement in macro environment, relatively under-geared balance sheet and its competitiveness enhanced by IATA Safety Audit for Ground Operations (ISAGO) registration.

    According to investment analysts, a valuation shows a target price of N5.97 per share for SAHCO in the immediate future, representing an upside of 28.44 per cent on its IPO price of N4.65 per share.

    “We have valued SAHCO, using a pure-Discounted Cash Flow (DCF) valuation methodology, evaluating the company’s assets across its ramp and cargo handling business, in addition to future investments. Our positive investment case for SAHCO centres on the fact that the company represents a long-term play on air traffic and aviation industry growth, and benefits from high barriers to entry,” Cordros Securities stated.

    The report, however, identified key downside risks to include weaker-than-expected macro-economic performance, susceptibility of operations to labour action, revenue downside from potential insolvency of some airline customers and regulatory risk.

    The report noted that SAHCO has become somewhat of the ‘poster-child’ for privatisation, stemming from its incredible turnaround in performance in a short period since the government’s divestment.

    According to the report, management of SAHCO has stated its intention of sustaining the company’s impressive post-privatisation performance, listing key strategic goals to include expansion of revenue, cost control and reduction, customer satisfaction and stability and sustainability.

    The report pointed out that SAHCO has a positive long-term growth outlook, citing the transformation in the Nigerian market, which appears to be promising for SAHCO.

    According to the report, Nigeria’s aviation market is the third largest in Africa. Although relatively cyclical, the sector has recorded a 10-year GDP CAGR of 9.0 per cent, almost double the national GDP CAGR of five per cent. Nigeria has huge potential to become an aviation hub for Africa, using its natural advantages such as its central location on the continent, huge population and a growing middle class.

    “As the second largest aviation ground handling service provider in Nigeria, SAHCO is well positioned to benefit from the expected long-term expansion of air traffic growth and demand for travel to, from and over Nigeria and the West African region. With respect to Nigeria air traffic trends, growth is expected to rebound after a more depressed period reflective of macro-economic development,” the report stated.

    The Nigerian Bureau of Statistics (NBS) expects air traffic growth of 20 per cent for 2018 compared to 2017, on the back of improving business confidence, positive policy reforms – ease of doing business, visa on arrival – as well as development of infrastructure.

    “In our view, the Nigerian market is transitioning, from an economic standpoint – following three challenging years – and 2018 and beyond appear to be promising years for SAHCO to take advantage of. Firstly, we see economic growth benefitting from higher government and private sector spending, both riding on improved revenues from crude oil. Secondly, improved oil earnings should further improve FX liquidity and sustain stability, after the volatile era,” Cordros stated.

  • SAHCO demands new fiscal regime for business

    Skyway Aviation Handling Company (Sahco) Plc is demanding a new fiscal regime that exempts investors in the ground handling and warehousing sub-sector of the aviation industry from paying Value Added Tax (VAT) as well as Custom duties on imported technology, machines and spare parts.

    Its Managing Director, Basil Agboarumi said such regime would trigger incentives to grow the ground handling, passenger ramp services and allied sub-sector in addition to creating jobs for Nigerians.

    Agboarumi said the government needed to assist ground handling firms by extending the waivers it granted to domestic carriers on exemption of duties on aircraft spares and parts and other notables.

    He said without ground handling firms, airlines could not operate at the airports because ground handlers provide logistic intensive services before and after the aircraft departs.

    He, however, lamented the exorbitant cost (in foreign exchange) invested on imported equipment used in the ground handling industry, saying while cost of operation had gone up astronomically in the last two to three years, ground handling firms were, however, constrained in increasing their charges.

    Agboarumi said ground handling firms would continue to make sacrifice for the sector, because many airlines and exporters would not be able to offer appropriate pricing for services rendered judging by economic realities.

    He said: “We need fresh incentives from the Federal Government to grow this sector and create jobs for our citizens. If the local airlines are granted incentives or waivers by the Federal Government on VAT and on Custom duties on imported machinery and parts, then ground handling firms who handle the most critical job for the airlines deserve to be also considered for such waivers.