BOC AVIATION (02588) released its 2025 annual performance report, with net profit of 787 million US dollars, a year-on-year decrease of 14.8%.

BOC AVIATION (02588) announced its annual performance for the year ending December 31, 2025, with operating and other income of $2.619 billion, a year-on-year increase of 2.4%; net profit of $0.787 billion, a year-on-year decrease of 14.8%; and basic earnings per share of $1.13. The company sold 35 of its owned aircraft in 2025, higher than the 29 sold in the previous year, mainly benefiting from strong investor demand and higher aircraft values. The net profit from aircraft sales increased by 81% to $0.213 billion. This translates to a sales profit margin of 15% for owned aircraft, which is five percentage points higher than in 2024. The average age of the sold aircraft was around nine years, consistent with the company's strategy of maintaining a young and fuel-efficient fleet. At the end of the year, the weighted average age of the owned fleet remained at five years, with a weighted average remaining lease term of 7.8 years, positioning the asset portfolio as one of the youngest and with the longest average lease term in the industry. As of December 31, 2025, the assessed value of the operating lease fleet was 18% higher than its book value, at $3.4 billion. The company's strong operational performance is reflected in a 2% increase in total operating and other income to $2.6 billion. Rental income continues to be the cornerstone of the company's profitability, accounting for over 70% of total revenue in 2025. The improvement in rental rates, driven by the maintenance of 100% fleet utilization throughout the year, profitable aircraft deliveries, and the timing of aircraft sales, led to an increase in the operating lease rate factor from 10.0% in 2024 to 10.3% in 2025. This improvement in rental rates also contributed to a 30 basis point increase in the operating lease net profit margin to 7.5%. Despite a significant amount of new aircraft deliveries and related capital expenditures focusing on the year-end, the operating lease rate factor and margin in the second half of the year remained similar to those in the first half. Given the company's strong financial leverage and ample cash flow, the board of directors decided to increase the payout ratio from 35% to 40%. The proposed final dividend for the year 2025 is $0.3061 per share, marking the highest level of dividends in the second half of the year in history, bringing the total annual dividend to $0.4537 per share. This distribution demonstrates the board's balance between enhancing shareholder returns and managing long-term capital needs prudently.