Efforts by Halifax-based Chorus Aviation to develop its nascent aircraft leasing business Chorus Aviation Capital (CAC) are making headway, as the company posted a C$40.8 million ($31.3 million) net profit for the second quarter of 2017, up 72.5% from C$23.7 million in 2Q 2016.

Chorus Aviation is also the parent of regional carrier Jazz Aviation and ACMI provider Voyageur Airways.

Following the extension of Chorus’ capacity purchase agreement (CPA) with Air Canada in early 2015, through which Chorus has 34 Bombardier Q400s and CRJ900s under lease from Air Canada, and the establishment of CAC in December 2016, the company has grown Chorus’s fleet of regional aircraft outside of the CPA to 17 aircraft with an average age of approximately three years, bringing its fleet total to 56.

Chorus reported C$333.4 million in operating revenue for the quarter, up 7.5% year-over-year (YOY), as expenses increased 7% to C$295 million, producing $C$38.4 million in operating income, up 11.7%.

Chorus’ revenue from Jazz Aviation increased 4.5% YOY to C$190 million, attributable to increased flying activity (Jazz’ billable block hours increased 5.1% YOY). Chorus’ aircraft leasing revenue under the CPA increased 27.8% YOY to C$29.5 million, attributable to additional Q400s added throughout 2016 and five owned CRJ900s deployed in 2Q 2017. The company’s charter and other contract revenue increased 24.3% YOY to $14.5 million, mainly attributable to new contracts for international ACMI flying by Voyageur Airways.

Chorus’ other revenue for the quarter more than doubled YOY to $15.1 million, mainly attributable to increased non-CPA aircraft leasing revenue (i.e. CAC) and MRO services rendered.

“We’re making significant progress in growth and diversification as we build [CAC] into a leading regional aircraft lessor,” Chorus president and CEO Joe Randell said. “Our objective is to become one of the top regional aircraft lessors in the world.”

CAC’s major leasing transactions for the second quarter included its acquisition of six ATR 72-600s with attached leases from Singapore-based lessor Avation PLC. Three of the aircraft are on lease with UK regional carrier Flybe; the other three are leased to Virgin Australia. On June 22, Chorus delivered the third of four new Bombardier CRJ1000 regional jets to Spanish regional carrier Air Nostrum; the fourth CRJ1000 is scheduled to be delivered in September.

Since the June 30 end of the quarter, Chorus has acquired three Bombardier Q400s on lease to Falcon Aviation Services pf Abu Dhabi, and has announced its intention to acquire three Embraer E190s on lease to Aeromexico Connect and an addition E190 on lease to KLM Cityhopper.

“[Our] diversification is made more robust through [our] securing products manufactured by the three, world leading regional aircraft manufacturers – Bombardier, ATR and Embraer – while adding new, well-established customers geographically dispersed across five continents,” Randell said.  “We are now delivering … a complete suite of regional aviation services including contracted flying, aircraft engineering, [MRO], parts provisioning and aircraft leasing solutions.”

Mark Nensel mark.nensel@penton.com