'Maxing out the client’s return on investment on all fronts whilst keeping great
liquidity of his assets'
Maxing out the client’s return on investment on all fronts whilst keeping great
liquidity of his assets
In most instances it is difficult to assess the liquidity of any aircraft. When
it comes to helicopters this is even more problematic. With 100 different turbine
powered models on the market produced by some nine manufacturers, each model fits
a limited number of mission profiles. One has to thoroughly understand each and every
model transactional dynamics throughout the year and beyond.
We had a situation where an operator wanted to upgrade from alight single turbine
to a light twin turbine powered helicopter. He was thinking to invest in a Eurocopter
AS355N model because of the helicopter’s ability to meet the JAR OPS3 Class I single
After a thorough market review, we noticed that the previous three years of AS355N
trading stock/fleet was very poor. We also realized that the helicopters for sale
took an average of just under two years to sell.
If the client wanted to dispose of his helicopter quickly, or for example upgrade
to a better machine, he risked being stranded with that specific model. We recommended
he invested in the much more capable Eurocopter EC135P2i model as these were sought
after and thus offered great liquidity and limited price depreciation over a three
year ownership cycle..
Although the purchase price was double that of the AS355N, we demonstrated that
the following combining factors were actually returning a substantial amount of money
whilst limiting the risks of liquidity over a three year ownership lifecycle:
1) Putting the right financing into place with a fair interest
rate below 6% on a lease purchase
2) Fixing the right balloon payment for the three year financing
3) Putting the engine through the Pratt & Whitney ESP plan
to mitigate the risks of unscheduled removals whilst ensuring the client did not
suffer cash flow issues and at the same time adding value when reselling the helicopter
with the OEM engine maintenance contract fully paid
4) Securing a strong reselling price and allowing for a profit
to be made at any given time of the lifecycle should the helicopter needed to be
5) Flying a more capable machine, taking better contracts and
in the end increasing the company profit substantially!