Chairman’s Statement
Having joined SMBC Aviation Capital last year, I have now fully embedded myself in the business and am incredibly proud to be Chairman of one of the world’s leading aircraft leasing companies. It is a business with positive, constructive, deeply embedded values, supported by its careful and committed relationship with its shareholders and driven by the dedication of the people I serve alongside.
A global business and team
I became Chairman of the Company in May 2023 as it embarked on an ambitious new phase in its development. SMBC Aviation Capital is now the second-largest aircraft lessor globally by number of aircraft, following the successful integration of Goshawk and additional direct investment in our portfolio of aircraft. With a clear focus on the most modern, fuel-efficient aircraft types that are most in demand with our customers, combined with the deep expertise within the business and the long-term support of our shareholders, our newfound scale has given us an increased competitive edge. The enlarged business provides an even broader range of innovative solutions to a growing customer base and is well placed to deliver significant long-term value to our shareholders as a result.
With the integration of Goshawk complete, we are now one unified company, with all of our Dublin-based employees located in a new state-of-the-art headquarters in the heart of the city with leading sustainability credentials. The move reflects our strong corporate culture, demonstrating how we prioritise both people and business strategy to maximise productivity and enhance socially responsible working practices.
Supportive shareholders
SMBC Aviation Capital receives unwavering support from its shareholders – Sumitomo Mitsui Finance and Leasing (“SMFL”), a leading general leasing company in Japan and Sumitomo Mitsui Banking Corporation (“SMBC”), one of the world’s leading banks, giving us a robust financial position, reflected in our strong investment-grade credit ratings. Our shareholders’ support is critical to our success and is built on deep confidence in our leadership team, strategy, and the long-term potential of the business, which continues to grow and develop. As our primary lenders, they provide us with a huge competitive advantage, offering access to large-scale and competitively priced financing throughout the cycle. This was critical during the pandemic, enabling us to deliver high-quality balance sheet growth at the low point in the cycle which offered greatest value, and we are now well positioned to fully capitalise on the strong opportunities in our industry.
Strong business, solid footing
During the past year we have continued to deliver outstanding performance, demonstrating the Company’s resilience and resounding recovery following the pandemic. The strength of these results – headlined by record profit before tax – underlines our ability to unlock value from large-scale, strategically timed asset growth, backed by our supportive shareholders.
In the current supply-constrained market, our aircraft are in high demand, with our management constructing a portfolio of high-quality assets that our customers both want and need. On the trading side, we focus on selling aircraft for profit as well as portfolio management. We trade older assets and recycle capital into newer, fuel-efficient aircraft, which represent 67% of the portfolio today.
ESG
SMBC Aviation Capital’s ambition is to help create a sustainable future for our business, communities, and other stakeholders and we are fully committed to each element of our Environmental, Social, and Governance (“ESG”) strategy.
We firmly believe that aviation makes a strongly positive contribution to society and our actions as a business can help deliver a more sustainable future for the sector, while also delivering a positive impact for our employees and the communities in which we operate. This year, we are proud to have opened the Trinity College Dublin Sustainable Aviation Fuel (“SAF”) Research Facility at our Dublin headquarters, which underscores our dedication to contributing to the aviation industry’s overall decarbonisation journey. Notably, the SAF Research Facility hosts Trinity College Dublin’s contribution to the EU SAF Clearing House, whose mission is to support and drive the EU-wide and global deployment of SAFs.
The Social aspect of our ESG strategy concerns the way we interact with the stakeholders most crucial to our business – people. Our various teams and committees ensure positive action across key issues, such as employee well-being, social elements, Equality, Diversity and Inclusion (“EDI”) initiatives, and employment standards.
Open Arms Malawi
SMBC Aviation Capital have visited our charity partner Open Arms Malawi since June 2016.
Belvedere Youth Club
Peter Barrett (CEO), Paschal Donohoe (Minister for Public Expenditure, National Development Plan Delivery and Reform), Noriyuki Hiruta (Chairman) and Jenny Courtney (CEO, Belvedere Youth Club).
As a business, we understand our responsibility to the communities in which we operate. We aim to embody the values of our employees, customers, and shareholders through our CSR activities, making a meaningful, authentic contribution to society. Our CSR programme reflects our commitment to giving back to communities at a local and international level, supporting vulnerable groups and engaging our staff in impactful projects. This also provides our staff with opportunities for growth and development, which is a cornerstone of our culture, and we are proud to have supported meaningful change in the lives of the people we have the privilege of supporting.
During this fiscal year, two groups of SMBC Aviation Capital employees travelled to India and Malawi to work with our charity partners, Pratyek and Open Arms Malawi. Additionally, 300 of our employees took part in our 4th and largest-ever Difference Day activity in Ballymun (Dublin), transforming an underprivileged DEIS (Delivering Equality of Opportunity in Schools) senior school, helping us give back to the local community.
As part of our commitment to being a force for good, SMBC Aviation Capital has established a partnership with the Dublin-based Together Academy, an outstanding organisation that provides education and social support programmes for young adults with Down Syndrome. Together Academy will have a training facility and training cafe for their students in SMBC Aviation Capital’s new headquarters and we feel privileged to have them work alongside us.
Together Academy
Some of the team from The Together Academy who will be working in Fitzwilliam 28
Expansive opportunities
It has been a productive year, and the combination of organic and inorganic growth positions us well for the future – both strategically and operationally. We have added scale, reinforced our portfolio of high-quality aircraft assets and cemented our position as a market leader. With a talented team of world-class people, an attractive portfolio of new technology and tradeable assets and a strong balance sheet, I firmly believe SMBC Aviation Capital is ideally placed to capitalise on the broad range of global opportunities in our sector, this year and beyond.
Noriyuki Hiruta
Chairman