Alliance Aviation Services Limited (ASX:AQZ)

The 1H FY26 presentation for Alliance Aviation Services Limited details significant financial and operational challenges faced during the period ending December 31, 2025. The company reported a total revenue of $369.1 million, mainly driven by contract and wet lease operations, despite a 9% revenue increase. However, Alliance faced substantial impairment charges totaling $164.8 million primarily due to the Fokker aircraft and related assets, impacting the net profit and overall financial performance. The commercial viability of certain wet-lease agreements was under scrutiny, as they negatively affected cash flow and financial outcomes. Total fleet consisted of 81 aircraft with planned retirements and replacements over the next 4-5 years. Capital expenditures and maintenance issues also posed challenges, with substantial cash outflows for engine care and fleet maintenance. The company is engaged in cost control measures and asset sales to improve financial resilience. Efforts to negotiate better terms with major wet-lease customers are ongoing. Alliance also highlighted its strong FIFO (fly-in fly-out) contract services, which remain a critical revenue stream.