Haeco net drops 21.2pc despite 65.6pc revenue rise

Hong Kong Aircraft Engineering Co (Haeco) reported net profit dropped 21.2 per cent in the first half even though revenue surged 65.6 per cent, reflecting the continued shortage of skilled labour and declining demand for engine services.

Revenue of the aircraft maintenance company controlled by Swire Group rose to HK$5.34 billion with its acquisition of US service provider Timco in February.

Net profit fell to HK$283 million from HK$359 million a year earlier.

Haesl and Saesl, the group's partly owned engine maintenance service providers in Hong Kong and Singapore, contributed HK$136 million of the profit, 46.7 per cent less than the amount last year, which the company blamed on waning demand for engine overhaul services with the retirement of older engine types.

Chief executive Augustus Tang Kin-wing said the shortage of skilled labour, from which the company had been suffering since 2012, was alleviated with the churn rate a third lower than last year.

Tang declined to reveal the actual rates, but said the figure for aircraft mechanics was now in the "lower single digits" with improvements in pay and training.