Alliance Announces Leadership Succession:

Founder Scott McMillan to transition from Managing Director role; Stewart Tully to assume the role of sole Managing Director

Alliance, one of Australia’s leading aviation services companies, today announces a planned leadership transition that will see founder Scott McMillan step down as Joint Managing Director at the company’s Annual General Meeting (“AGM”) on 27 November 2025.

Stewart Tully, currently Joint Managing Director, will assume the role of sole Managing Director following the AGM, marking the successful conclusion of a 12-month succession plan.

Scott McMillan was one of the founders of Alliance Airlines in 2002 and has led the company through more than two decades of sustained growth, including its successful ASX listing in 2011. Under his leadership, Alliance has become one of Australia’s largest aviation companies, serving key industries and communities while building a workforce of 1,450 employees.

“It has been an incredible privilege to lead Alliance from its inception through to becoming a leading Australian aviation services provider,” Mr McMillan said. “I am immensely proud of what we have built together; a company known for operational excellence, safety, and reliability. Alliance has provided uninterrupted service to its customer base through pandemic, global financial crisis and numerous cycles in the resource industry, and I thank all our staff, past and present directors, suppliers, customers and past and present shareholders for their support over the past 24 years”

Mr McMillan will remain in an executive capacity until July 2026, focusing on the completion of several key strategic projects to ensure continuity and to support the leadership transition.

Mr McMillan will remain on his current fixed annual salary until his retirement in July 2026. However, he has elected not to participate in the company’s short-term incentive or long-term incentive plan in the current financial year ending 30 June 2026. He will retain his entitlement to 33,771 company performance rights, earned in previous years that will vest upon his retirement in July 2026.

Stewart Tully brings a decade of experience with Alliance to his new role as Managing Director. His appointment as Chief Executive Officer over 12 months ago, followed by his elevation to Joint Managing Director in August 2025, formed part of a deliberate succession strategy designed to ensure seamless continuity of leadership.

“I am honoured to be appointed Managing Director and grateful for the confidence the Board and Scott have placed in me,” Mr Tully said. “Alliance has a remarkable foundation built over more than two decades, and I am committed to building on that legacy.”

Mr Tully emphasised that the company’s core focus remains unchanged: “Delivering safe, reliable aviation services to our customers while supporting our people and the communities we serve. I am excited about the opportunities ahead and look forward to leading our talented team as we pursue our strategic objectives.”

James Jackson, Chairman of Alliance Aviation, paid tribute to Mr McMillan’s contribution while expressing confidence in the leadership transition.

“The company owes a deep debt of gratitude to Scott, who has been instrumental in building one of Australia’s largest aviation companies, servicing key industries and communities,” Mr Jackson said. “Under his leadership, Alliance has grown from a start-up operation to a substantial ASX-listed aviation business with a strong market position and an excellent reputation.

“Stewart Tully is well respected in the aviation industry and well equipped to lead the company through this next important chapter in its development. His decade of experience with Alliance, combined with his operational expertise and deep understanding of our business, positions him ideally for this role.”

PO Box 1126, Eagle Farm QLD 4009 T +61 7 3212 1212 | F +61 7 3212 1522 www.allianceairlines.com.au

24th June 2025

ASX Release

Alliance Aviation Services Limited (“Alliance”) (ASX: AQZ)

Engines Sale Realise USD40.2m

Alliance is pleased to announce that the Company has entered into a binding sale and purchase agreement with Beautech Power Systems (Dallas, Texas) for the sale of twelve (12) General Electric CF34-10 engines.

These engines will be delivered to Beautech ex Knock, Ireland after having been removed from six airframes sold to Eirtrade and previously announced on 4th September 2024. Ten engines will be delivered this current financial year and the remaining two will be delivered in early FY26.

Total consideration for this transaction is approximately $62.3m (USD40.2m) with the final amount subject to standard adjustments for delivery conditions and the prevailing AUD/USD exchange rate.

This transaction will have no impact on the current profit guidance provided for the current financial year.

The sale of these engines will lead to a substantial reduction in inventory value in this financial year, and a consequent and significant reduction in the net debt position of the Company.

Commenting on this transaction, Alliance Managing Director, Scott McMillan stated, “We are delighted with this outcome where we have again, been able to monetise inventory at values commensurate with current market prices and take advantage of the low AUD/USD exchange rate. Our Aviation Services business has and will continue to make a significant contribution to the financial performance of the Company. Most of the engines sold have remaining lives that are surplus to the Company’s current requirements. This transaction is consistent with our Company objectives of reducing overall inventory levels, unlocking surplus value and retiring debt.

“We are also delighted to have formed a strong relationship with Beautech who a leading trader and lessor of aircraft engines are and well situated in the General Electric CF34-10 market.”

Lee Beaumont, Founder, President and CEO of BeauTech commented, “Over the course of our recent negotiations with Alliance, we have developed a strong and collaborative relationship, supported by several visits to Brisbane by myself and the BeauTech team. We hold Alliance’s commercial approach in high regard and are particularly impressed by the strength and uniqueness of their business model. As the world’s leading lessor and financier of CF34 engines, BeauTech is deeply committed to this platform and is investing significantly in the -10E variant. We see a strong alignment in the entrepreneurial mindset shared by both organisations and look forward to supporting Alliance in the years ahead.”

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Here's a copy of a post on LinkedInby my nephew (an aviation newbie).

I'm looking at this from an $AQZ perspective, particularly in relation to the Virgin purchase of the new Embraer planes. As the largest maintenance and parts supplier for Embraer in SE Asia, it can only be good news for $AQZ

Here's his post:

Yesterday I was invited to check out ASL Airlines Australia’s gorgeous Embraer E190-E2.

Based on the incredibly popular Embraer E190, the E190-E2 “Profit Hunter” features modern engines and wings, which give it a longer range, better performance, and lower operating costs. The Embraer E2 family is taking the world by storm, with 350+ orders from customers in 18 different countries. One of the latest customers to join the club is Virgin Australia Regional Airlines (VARA), with an order for eight brand-new E190-E2s to be delivered in just a few months.

For VARA, the E190-E2 is more than just a replacement for the airline’s aging Fokker 100 fleet; it’s the start of a new era in regional aviation. Capable of taking off on a runway that’s just over a kilometre long, and with a range of 5,500 km with a full passenger load, the E190-E2 brings a new capability to the regional market that has never been seen before in Australia. This allows for new routes to be launched, and existing routes to be served better and more efficiently. The E190-E2 uses 30% less fuel than a Fokker 100 while carrying the same number of passengers.

The E2 also packs some innovative technology that has never been seen on an aircraft of this size before. Trailing link landing gear gives the aircraft better takeoff and landing performance while enhancing safety. An advanced computer-designed wing with a “gull-wing” shape increases lift and efficiency while compensating for the aircraft’s larger engines.

The E2 is also the first regional airliner to feature raked wingtips—a design element usually found on long-range widebodies like the Boeing 777—to reduce drag and allow the E2 to fly even further. Embraer continues to actively improve the E2; last year, Embraer announced the launch of the “E2TS” takeoff software, which perfectly matches the plane’s speed and angle during takeoff to gain the best performance and safety off short runways.

I am so thankful for the amazing team at VARA and ASL Airlines Australia for allowing me the opportunity to get to know this fascinating aircraft up close!

#Embraer #Aviation #ASLairlines #VirginAustralia #RegionalAviation #AustralianAviation #Aircraft #Airliners #Travel

Just noticed $AQZ has popped by >7% today, with no asx announcements. Quite a bit for a steady as she goes type business with little share price volatility (usually).

Any thoughts.....not that I'm complaining.

Held IRL & SM Portfolios

Our Rockhampton Aviation Maintenance (RAM) facility celebrated the commencement of its first line of maintenance last month.

QantasLink's VH-UZD (Embraer E190) entered the hangar for a scheduled C-Check in mid-November.

Commencing the first line of maintenance is a significant milestone for our Rockhampton teams and has been many years in the making.

The first check is also representative of Alliance Airlines' commitment to long-term sustainable employment in regional Australia and our focus on an Australian-based future for aircraft maintenance.

A second and third line of maintenance will commence in the coming year, with recruitment for RAM staff an ongoing priority.

Congratulations to everyone involved in achieving this milestone.

28th November 2024

ASX Release

Alliance Aviation Services Limited (“Alliance”) (ASX: AQZ) Sale of 6 Airframes and 13 Engine Cores

Alliance today announces that is has executed two binding contracts, with Scissortail Aviation, LLC and Bellinger Asset Management Pty Ltd, covering the sale of six Embraer E190 airframes and one binding contract, with Airline Technical Support Caribe B.V., for the sale of 13 surplus Rolls-Royce engine cores.

Under the first two contracts Alliance will sell six Embraer E190 airframes that have been, or will be, purchased by Alliance over the next three months.

These airframes represent six of the 30 airframes previously announced under the ‘Aercap Transaction’ in February 2023. The first of the deliveries under these contracts will occur in December 2024 with all deliveries scheduled to be completed by the end of February 2025.

Four of the airframes are already owned by Alliance and two remain to be settled with Aercap in January and February 2025.

Under the airframe sale agreements, Alliance will retain ownership of the engines, undercarriage and auxiliary power unit, all of which will remain in storage in Europe, and be marketed for sale or retained for Alliance’s own internal use, if required.

Under the third contract, Alliance will sell 13 surplus, time expired and or unserviceable Rolls­Royce Tay 620/650 engine cores.

Deliveries of those engine cores has begun and will be completed by February 2025.

These engine cores are surplus to requirements for the Alliance Fokker 70 and Fokker 100 fleet given the recent acquisition of serviceable engines that will replace the Rolls-Royce “Total Care” programme from 1st January 2025.

These transactions monetise significant surplus inventory holdings and also provide additional high value componentry in a “ready for sale” condition. The revenues from this activity and any future revenues from the sales of these components will be captured in Alliance’s growing Aviation Services Business Unit.

As advised in our ASX announcement of 4th September 2024, the estimated cash benefit of these sales and resulting airframe capital expenditure avoidance is between $20m and $23m with most of this appearing in Alliance’s second half of FY25 results

In addition, the cessation of the ‘Rolls-Royce Total Care’ programme reduces future annual capital expenditure by approximately $10m to $15m per annum from FY26 onwards.

I'm guessing a 1.6% upside to today's price is validation for the benefits $AQZ will glean from $REX tough current situation in administration.

Whilst $REX and $AQZ have different business models and client bases, i.e. Rex doing flights between capital cities (or was before EY were appointed as administrators) and also regional destinations (still operating) and Alliance focusing on FIFO and wet/dry leasing to almost anyone without bias, the current struggles at Rex must be seen as a great opportunity for Alliance.

After discussions with the TWU today, it was reported that as many as 610 workers will be laid off. Whilst this is horrid news for Rex, one of the significant roadblocks to Alliance and their switched-on management team kicking even bigger goals for their ever increasing fleet (and the spare parts business they are now renowned for both regionally and globally) is qualified personnel.  Assuming some of these could be secured via these proposed lay-offs, it can only be good news for MD Scott McMillan and his team.

RL portfolio holder only of $AQZ