Annual Financial Report

AVATION PLC (the "Company")
REGISTERED NUMBER: 05872328 (ENGLAND & WALES)
CHAIRMAN'S STATEMENT
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011

On  behalf  of your Board of Directors, I present to you the audited financial statements for Avation PLC  and  its
subsidiaries for the year ended 30th June 2011 and to inform you of the progress that the Avation Group has made.

The highlights are:

*       Record net after tax profits, increased by 120% to: GBP 3,627,293;
*       Record earnings per share increased by 87% to 11.95 pence; and
*       Dividends increased by 66% to: 1.00 pence per share.

Your Board is pleased to report that in respect of the year ending 30th June 2011 the consolidated net profit after
tax was GBP 3,627,293 on revenues of GBP 16,291,428 with earnings per share of 11.95 pence.

The  operating  businesses  had  a good year with the signing of a major strategic growth  initiative  with  Virgin
Australia  in  respect to the delivery of between 8 and 18 new Aircraft. Operationally there  were  excellent  cash
flows  being  recorded across the Group.  The business has continued to grow and we have increased the  net  profit
after tax for the Group by 120%. As of June 30th, the net assets of the Group has increased from GBP 36,031,926  to
GBP 49,460,598 by 37%.  The Board of Directors believe that they have demonstrated that the Group has a sustainable
business model which demonstrates consistent performance.

The  Group  has entered into 10-year loan facility agreements for up to US$152.2m, principally under a  mandate  to
Credit  Agricole Corporate and Investment Bank.  The loan facilities can be drawn down progressively by an aircraft
by  aircraft basis for the purpose of purchasing eight new ATR72 Aircraft for operation in Australia.  The aircraft
are  being leased by the Company to Australian carrier Skywest Airlines, who in turn operate the aircraft on behalf
of Virgin Australia, under the virgin Australia brand, pursuant to 10 year wet-leases.

As  at  the  balance sheet date of June 30th 2011, Avation Plc had not delivered any of the ATR72  aircraft  to  be
operated  for Virgin Australia. Therefore the financial performance presented in these results do not  include  any
revenues  from  these  aircraft.  All deliveries and revenues commence after the balance  date.  The  first  Virgin
Australia aircraft was delivered on the 11th of August 2011, the second on the 18th of August 2011 and the third on
the  13th of October 2011. It is anticipated that the 4th aircraft will be delivered during November 2011 and  four
deliveries are planned to occur during mid 2012.

Your Board overwhelmingly recognises the importance of rewarding shareholders and is recommending to shareholders a
final  dividend payment of 1 pence per share and the Company hopes to maintain a progressive dividend policy  going
forward. The record date for this final dividend will be announced in the meeting materials for the upcoming annual
general meeting.

The  Company  is registered in England and Wales, however, the group is operationally headquartered  in  Singapore.
Therefore  during 2011 the Company successfully made an application to migrate its tax resident to Singapore.  With
effect  from 1 April 2011 the Company became a Singaporean Corporate Taxpayer. The current corporation tax rate  in
Singapore is 17%.

The Company and its subsidiaries have secured the bulk of its debt funding at a cost of around 6% per annum. Whilst
the  Company  believes that it can obtain access to further funds for the purchase of aircraft, access  to  funding
nevertheless  remains  a  risk,  this risk is common to all businesses that are capital  intensive,  such  as  your
business.  Specific  aviation  based industry risks are also present and include  the  creditworthiness  of  client
airlines.
AVATION PLC (the "Company")
REGISTERED NUMBER: 05872328 (ENGLAND & WALES)
CHAIRMAN'S STATEMENT
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011

My  colleagues  and  I  are  committed  to continue to work tirelessly to build  your  Company  into  a  respected,
profitable,  diversified and cash generative aircraft leasing business. The Board would like to  thank  you  -  the
shareholders  and all other stakeholders - for your continued support and goodwill and look forward to  the  future
with confidence in the successful development of Avation PLC.

Robert Jeffries Chatfield,
Chairman

Singapore
28 October 2011

AVATION PLC
REGISTERED NUMBER: 05872328 (ENGLAND & WALES)
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
                                                                                        2011             2010
Continuing operations                                                                     ?                ?

Revenue                                                                                 16,291,428       17,552,513

Cost of sales                                                                            (739,278)        (983,879)

Gross profit                                                                            15,552,150       16,568,634

Other income                                                                               297,792            5,948

Other operating expenses                                                               (6,207,042)      (8,864,955)

Expenses                                                                                                           
- Administrative expenses                                                              (1,255,756)        (841,892)
- Finance expenses                                                                     (2,755,498)      (3,319,635)

Profit before taxation                                                                   5,631,646        3,548,100

Taxation                                                                                 (574,920)        (729,517)

Profit from continuing operations for the year                                           5,056,726        2,818,583
Other comprehensive income                                                                                         
Gain on dilution of interest in subsidiary                                                       -            1,733
Currency translation differences arising on consolidation                              (1,809,245)        4,076,569
Revaluation gains on property, plant and equipment, gross of tax                         1,341,951                -
Deferred tax on revaluation gains on property, plant and equipment                       (482,322)                -
Other comprehensive income for the year, (net of tax)                                    (949,616)        4,078,302

Total comprehensive income for the year                                                  4,107,110        6,896,885

Profit attributable to:                                                                                            
Equity holders of the parent                                                             3,627,293        1,653,027
Non-controlling interest                                                                 1,429,433        1,165,556
                                                                                         5,056,726        2,818,583

Total comprehensive income attributable to:                                                                        
Equity holders of the parent                                                             3,128,808        4,069,879
Non-controlling interest                                                                   978,302        2,827,006
                                                                                         4,107,110        6,896,885
Earnings per share                                                                                                 
- Basic - continuing and total operations                                              11.95 pence       6.39 pence
- Fully Diluted - continuing and total operations                                      11.84 pence       6.30 pence

AVATION PLC
REGISTERED NUMBER: 05872328 (ENGLAND & WALES)
CONSOLIDATED BALANCE SHEET
AS AT 30 JUNE 2011

                                                                                          2011             2010
                                                                                            ?                ?
ASSETS                                                                                                               

Current assets:                                                                                                      
Cash and cash equivalents                                                                  5,626,771        1,227,881
Trade and other receivables                                                                7,542,395        1,195,859
Inventories                                                                                    1,946              707
Total current assets                                                                      13,171,112        2,424,447

Non-current assets:                                                                                                  
Property, plant and equipment                                                             84,896,190       92,520,577
Goodwill                                                                                   1,324,541        1,324,541
Total non-current assets                                                                  86,220,731       93,845,118

Total assets                                                                              99,391,843       96,269,565

LIABILITIES AND EQUITY                                                                                               

Current liabilities:                                                                                                 
Trade and other payables                                                                   3,331,862        3,818,692
Provision for taxation                                                                        38,748           18,368
Loans and borrowings                                                                       9,865,455        9,602,462
Short-term provisions                                                                      2,849,839        2,047,185
Total current liabilities                                                                 16,085,904       15,486,707

Non-current liabilities:                                                                                             
Trade and other payables                                                                     942,009        1,379,641
Loans and borrowings                                                                      28,091,394       39,123,267
Deferred tax liabilities                                                                   4,811,938        4,248,024
Total non-current liabilities                                                             33,845,341       44,750,932

Equity attributable to shareholders:                                                                                 
Share capital                                                                                386,072          262,190
Share premium                                                                             10,543,750        1,249,258
Assets revaluation reserve                                                                 7,436,517        6,760,372
Capital redemption reserve                                                                     7,000            7,000
Warrant reserve                                                                               74,381                -
Foreign currency translation reserve                                                       2,388,729        3,563,359
Retained earnings                                                                         14,890,326       11,434,226
                                                                                          35,726,775       23,276,405
Non-controlling interest                                                                  13,733,823       12,755,521
                                                                                          49,460,598       36,031,926

Total liabilities and equity                                                              99,391,843       96,269,565

AVATION PLC
REGISTERED NUMBER: 05872328 (ENGLAND & WALES)
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
                                                                                 2011                  2010
                                                                                   ?                    ?
Cash flows from operating activities:                                                                             
Profit before taxation                                                       5,631,646            3,548,100
Adjustments for:                                                                                
    Depreciation expense                                                     4,964,453            4,704,804
    Claim on maintenance reserve                                             1,242,589            4,102,127
    Warrant expense                                                          74,381                -
    Interest expense                                                         2,680,231            3,156,229
    Interest income                                                          (3,607)              (5,948)
    Operating profit before working capital changes                          14,589,693           15,505,312
Movement in working capital:                                                                      
    Trade and other receivables                                              (5,157,029)          379,919
    Inventories                                                              (1,239)              (214)
    Trade and other payables                                                 (972,482)            796,367
    Short-term provisions                                                    (311,597)            (3,143,497)
    Cash from operations                                                     8,147,346            13,537,887
Interest paid                                                                (2,809,256)          (3,156,229)
Interest received                                                            3,607                5,948
Corporation tax paid                                                         (440,543)            (204,574)
Net cash from operating activities                                           4,901,154            10,183,032

Cash flows from investing activities:                                                             
    Purchase of property, plant and equipment                                (19,233)           (1,237)
Loan to related parties                                                      (1,579,860)          -
Net cash used in investing activities                                        (1,599,093)        (1,237)

Cash flows from financing activities:                                                           
    Net proceeds from issuance of ordinary shares                            9,418,374            39,557
    Net proceeds from issuance of subsidiary's shares to minority              -                  22,972
    Dividends paid                                                           (171,193)            (131,095)
    Proceeds from borrowings                                                 1,257,800             -
    Repayment of borrowings                                                  (8,192,846)          (4,283,186)
    Capital element of finance lease repayments                              (1,355,278)           (781,036)
Net cash from (used in) financing activities                                 956,857              (5,132,788)
Effects of exchange rates on cash and cash equivalents                       139,972              (4,860,447)
Net increase in cash and cash equivalents                                    4,398,890             188,560
Cash and cash equivalents at beginning of financial year                     1,227,881             1,039,321
Cash and cash equivalents at end of financial year                           5,626,771             1,227,881

Avation plc