Highlights for the Three Months Ended May 31, 2024
- Total revenues of $205 million
and net income of $16 million
- Adjusted EBITDA(1) of $186
million
- Lease rental revenue and direct financing and sales-type lease
revenue increased 14% compared to first quarter 2023
- Acquired 9 aircraft for $223
million; net book value of flight equipment is $7.3 billion, up 7% compared to first quarter
2023
- Fleet utilization at 99%
Liquidity
- Ratings Outlook revised to Positive by S&P
- Received $300 million equity from
shareholders in June 2024, completing
a $500 million total commitment
- Total liquidity as of July 5,
2024 of $2.6 billion includes
$2.0 billion of undrawn facilities,
$0.5 billion of projected adjusted
operating cash flows and sales through July
5, 2025, and $0.1 billion of
unrestricted cash
- 212 unencumbered aircraft and other flight equipment with a net
book value of $6.0 billion
STAMFORD, Conn., July 11, 2024 /PRNewswire/ -- Mike Inglese, Aircastle's Chief Executive
Officer, commented, "The increasing demand for air travel has
enabled global traffic to meet, and in some regions, exceed 2019
levels. While IATA is predicting world passengers to increase
3.8% annually over the next 20 years, aircraft and engine
manufacturers are not providing the output that meets even baseline
needs of airlines. As a result, we're seeing strong long-term
demand for all narrow-body passenger aircraft types and extended
viability of current technology aircraft."
Mr. Inglese concluded, "We recently announced that our
shareholders, Marubeni Corporation and Mizuho Leasing, have
completed their $500 million equity
commitment. During the first quarter, our IG status was further
bolstered by an Outlook revision to Positive from S&P. With
positive tailwinds, we're pleased to be putting our equity to work
and growing our fleet with the most sought-after narrow-body
passenger aircraft."
(1) Refer to the selected financial information
accompanying this press release for a reconciliation of GAAP to
Non-GAAP numbers.
Aviation Assets
As of May 31, 2024, Aircastle owned 250 aircraft and other
flight equipment having a net book value of $7.3 billion. We also manage 9 aircraft
with a net book value of $268 million
on behalf of our joint venture with Mizuho Leasing.
Owned
Aircraft
|
As of
May 31, 2024
|
|
As of
May 31, 2023
|
Net Book Value of
Flight Equipment
|
$
7,327
|
|
$
6,862
|
Net Book Value of
Unencumbered Flight Equipment
|
$
5,958
|
|
$
5,348
|
Number of
Aircraft
|
250
|
|
244
|
Number of Unencumbered
Aircraft
|
212
|
|
206
|
Number of
Lessees
|
76
|
|
73
|
Number of
Countries
|
44
|
|
43
|
Weighted Average Fleet
Age (Years)(1)
|
9.6
|
|
9.6
|
Weighted Average
Remaining Lease Term (Years)(1)
|
5.2
|
|
5.4
|
Weighted Average Fleet
Utilization during the three months ended May 31, 2024 and
2023(2)
|
99.1 %
|
|
95.6 %
|
|
|
|
|
Managed Aircraft on
behalf of Joint Ventures
|
|
|
|
Net Book Value of
Flight Equipment
|
$
268
|
|
$
282
|
Number of
Aircraft
|
9
|
|
9
|
_______________
|
1. Weighted by Net Book
Value.
|
2. Aircraft on-lease
days as a percentage of total days in period weighted by Net Book
Value.
|
Conference Call
In connection with this press release, management will host a
conference call on Thursday, July 11, 2024, at 9:00 A.M. Eastern Time. All interested
parties are welcome to participate on the live call. The
conference call can be accessed by dialing 1 (800) 836-8184 (from
within the U.S. and Canada) or +1
(646) 357-8785 (outside the U.S. and Canada) ten minutes prior to the scheduled
start. Please reference our company name "Aircastle" when prompted
by the operator.
A simultaneous webcast of the conference call will be available
to the public on a listen-only basis at www.aircastle.com.
Please allow extra time prior to the call to visit the site and
download the necessary software required to listen to the internet
broadcast.
For those who are not available to listen to the live call, a
replay will be available on Aircastle's website shortly after the
live call.
About Aircastle Limited
Aircastle Limited acquires, leases and sells commercial jet
aircraft to airlines throughout the world. As of May 31,
2024, Aircastle owned and managed on behalf of its joint ventures
259 aircraft leased to 77 airline customers located in 44
countries.
Safe Harbor
All statements in this press release, other than
characterizations of historical fact, are forward-looking
statements within the meaning of the federal securities laws,
including the Private Securities Litigation Reform Act of
1995. Examples of forward-looking statements include, but are
not necessarily limited to, statements relating to our proposed
public offering of notes and our ability to acquire, sell, lease or
finance aircraft, raise capital, pay dividends, and increase
revenues, earnings, EBITDA and Adjusted EBITDA and the global
aviation industry and aircraft leasing sector. Words such as
"anticipates," "expects," "intends," "plans," "projects,"
"believes," "may," "will," "would," "could," "should," "seeks,"
"estimates" and variations on these words and similar expressions
are intended to identify such forward-looking statements.
These statements are based on our historical performance and that
of our subsidiaries and on our current plans, estimates and
expectations and are subject to a number of factors that could lead
to actual results materially different from those described in the
forward-looking statements; Aircastle can give no assurance that
its expectations will be attained. Accordingly, you should
not place undue reliance on any such forward-looking statements
which are subject to certain risks and uncertainties that could
cause actual results to differ materially from those anticipated as
of the date of this press release. These risks or
uncertainties include, but are not limited to, those described from
time to time in Aircastle's filings with the SEC and previously
disclosed under "Risk Factors" in Item 1A of Aircastle's most
recent Form 10-K and any subsequent filings with the SEC. In
addition, new risks and uncertainties emerge from time to time, and
it is not possible for Aircastle to predict or assess the impact of
every factor that may cause its actual results to differ from those
contained in any forward-looking statements. Such
forward-looking statements speak only as of the date of this press
release. Aircastle expressly disclaims any obligation to
revise or update publicly any forward-looking statement to reflect
future events or circumstances.
Aircastle Limited
and Subsidiaries Consolidated Balance
Sheets (Dollars in thousands, except share
data)
|
|
|
May 31,
2024
|
|
February 29,
2024
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
Cash and cash
equivalents
|
$
164,604
|
|
$
129,977
|
Accounts
receivable
|
9,380
|
|
12,518
|
Flight equipment held
for lease, net
|
7,047,120
|
|
6,940,502
|
Net investment in
leases, net
|
279,901
|
|
282,439
|
Unconsolidated equity
method investment
|
43,229
|
|
42,710
|
Other assets
|
278,458
|
|
271,807
|
|
|
|
|
Total
assets
|
$ 7,822,692
|
|
$ 7,679,953
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
LIABILITIES
|
|
|
|
Borrowings from secured
financings, net
|
$
855,908
|
|
$
875,397
|
Borrowings from
unsecured financings, net
|
3,876,765
|
|
3,823,099
|
Accounts payable,
accrued expenses and other liabilities
|
271,701
|
|
219,588
|
Lease rentals received
in advance
|
63,137
|
|
52,654
|
Security
deposits
|
71,488
|
|
69,544
|
Maintenance
payments
|
533,838
|
|
505,897
|
Total
liabilities
|
5,672,837
|
|
5,546,179
|
|
|
|
|
Commitments and
Contingencies
|
|
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY
|
|
|
|
Preference shares,
$0.01 par value, 50,000,000 shares authorized, 400
(aggregate
liquidation preference of $400,000) shares issued and outstanding
at May 31, 2024
and February 29, 2024
|
—
|
|
—
|
Common shares,
$0.01 par value, 250,000,000 shares authorized, 15,564
shares
issued and outstanding at May 31, 2024 and February 29,
2024
|
—
|
|
—
|
Additional paid-in
capital
|
2,078,774
|
|
2,078,774
|
Retained
earnings
|
71,081
|
|
55,000
|
Total shareholders'
equity
|
2,149,855
|
|
2,133,774
|
Total liabilities and
shareholders' equity
|
$ 7,822,692
|
|
$ 7,679,953
|
Aircastle Limited
and Subsidiaries Consolidated Statements of Income and
Comprehensive Income (Dollars in thousands, except per
share amounts) (Unaudited)
|
|
|
Three Months Ended
May 31,
|
|
2024
|
|
2023
|
Revenues:
|
|
|
|
Lease rental
revenue
|
$
162,570
|
|
$
146,735
|
Direct financing and
sales-type lease revenue
|
5,457
|
|
1,073
|
Amortization of lease
premiums, discounts and incentives
|
(6,649)
|
|
(7,207)
|
Maintenance
revenue
|
42,149
|
|
34,520
|
|
|
|
|
Total lease
revenue
|
203,527
|
|
175,121
|
Gain on sale or
disposition of flight equipment
|
1,010
|
|
42,594
|
Other
revenue
|
636
|
|
776
|
|
|
|
|
Total
revenues
|
205,173
|
|
218,491
|
|
|
|
|
Operating
expenses:
|
|
|
|
Depreciation
|
89,358
|
|
88,789
|
Interest,
net
|
64,813
|
|
56,891
|
Selling, general and
administrative
|
22,055
|
|
20,835
|
Provision for credit
losses
|
(145)
|
|
6,959
|
Impairment of flight
equipment
|
5,211
|
|
1,097
|
Maintenance and other
costs
|
4,443
|
|
8,533
|
|
|
|
|
Total operating
expenses
|
185,735
|
|
183,104
|
|
|
|
|
Other income
(expense):
|
|
|
|
Other
|
(304)
|
|
1,337
|
Total other income
(expense)
|
(304)
|
|
1,337
|
|
|
|
|
Income from continuing
operations before income taxes and earnings of unconsolidated
equity method investment
|
19,134
|
|
36,724
|
Income tax
provision
|
3,572
|
|
14,360
|
Earnings of
unconsolidated equity method investment, net of tax
|
519
|
|
406
|
|
|
|
|
Net income
|
$
16,081
|
|
$
22,770
|
|
|
|
|
Net income available to
common shareholders
|
$
16,081
|
|
$
22,770
|
|
|
|
|
Total comprehensive
income available to common shareholders
|
$
16,081
|
|
$
22,770
|
Aircastle Limited
and Subsidiaries Consolidated Statements of Cash
Flows (Dollars in
thousands) (Unaudited)
|
|
|
Three Months Ended
May 31,
|
|
2024
|
|
2023
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
16,081
|
|
$
22,770
|
Adjustments to
reconcile net income to net cash and cash equivalents provided by
operating activities:
|
|
|
|
Depreciation
|
89,358
|
|
88,789
|
Amortization of
deferred financing costs
|
4,343
|
|
4,031
|
Amortization of lease
premiums, discounts and incentives
|
6,649
|
|
7,207
|
Deferred income
taxes
|
5,314
|
|
3,812
|
Collections on net
investment in leases
|
713
|
|
927
|
Security deposits and
maintenance payments included in earnings
|
(2,210)
|
|
(3,203)
|
Gain on sale or
disposition of flight equipment
|
(1,010)
|
|
(42,594)
|
Impairment of flight
equipment
|
5,211
|
|
1,097
|
Provision for credit
losses
|
(145)
|
|
6,959
|
Other
|
(508)
|
|
(397)
|
Changes in certain
assets and liabilities:
|
|
|
|
Accounts
receivable
|
(1,273)
|
|
3,209
|
Other
assets
|
(2,927)
|
|
(3,607)
|
Accounts payable,
accrued expenses and other liabilities
|
17,967
|
|
2,272
|
Lease rentals received
in advance
|
9,441
|
|
9,178
|
Net cash and cash
equivalents provided by operating activities
|
147,004
|
|
100,450
|
Cash flows from
investing activities:
|
|
|
|
Acquisition and
improvement of flight equipment
|
(224,935)
|
|
(322,151)
|
Proceeds from sale of
flight equipment
|
25,379
|
|
53,782
|
Aircraft purchase
deposits and progress payments, net of returned deposits and
aircraft sales deposits
|
35,181
|
|
4,947
|
Other
|
(209)
|
|
(2,900)
|
Net cash and cash
equivalents used in investing activities
|
(164,584)
|
|
(266,322)
|
Cash flows from
financing activities:
|
|
|
|
Proceeds from secured
and unsecured debt financings
|
550,000
|
|
624,911
|
Repayments of secured
and unsecured debt financings
|
(520,118)
|
|
(569,206)
|
Deferred financing
costs
|
(48)
|
|
(527)
|
Security deposits and
maintenance payments received
|
34,960
|
|
31,620
|
Security deposits and
maintenance payments returned
|
(2,087)
|
|
(6,131)
|
Dividends
paid
|
(10,500)
|
|
(10,500)
|
Net cash and cash
equivalents provided by financing activities
|
52,207
|
|
70,167
|
Net increase
(decrease) in cash and cash equivalents
|
34,627
|
|
(95,705)
|
Cash and cash
equivalents at beginning of period
|
129,977
|
|
231,861
|
|
|
|
|
Cash and cash
equivalents at end of period
|
$
164,604
|
|
$
136,156
|
Aircastle Limited
and Subsidiaries Reconciliation of GAAP to Non-GAAP
Measures EBITDA and Adjusted EBITDA
Reconciliation (Dollars in
thousands) (Unaudited)
|
|
|
Three Months Ended
May 31,
|
|
2024
|
|
2023
|
Net income
|
$
16,081
|
|
$
22,770
|
Depreciation
|
89,358
|
|
88,789
|
Amortization of lease
premiums, discounts and incentives
|
6,649
|
|
7,207
|
Interest,
net
|
64,813
|
|
56,891
|
Income tax
provision
|
3,572
|
|
14,360
|
|
|
|
|
EBITDA
|
180,473
|
|
190,017
|
Adjustments:
|
|
|
|
Impairment of flight
equipment
|
5,211
|
|
1,097
|
|
|
|
|
Adjusted
EBITDA
|
$ 185,684
|
|
$ 191,114
|
We define EBITDA as income (loss) from continuing operations
before income taxes, interest expense, and depreciation and
amortization. We use EBITDA to assess our consolidated
financial and operating performance, and we believe this non-U.S.
GAAP measure is helpful in identifying trends in our
performance.
This measure provides an assessment of controllable expenses and
affords management the ability to make decisions which are expected
to facilitate meeting current financial goals, as well as achieving
optimal financial performance. It provides an indicator for
management to determine if adjustments to current spending
decisions are needed.
EBITDA provides us with a measure of operating performance
because it assists us in comparing our operating performance on a
consistent basis as it removes the impact of our capital structure
(primarily interest charges on our outstanding debt) and asset base
(primarily depreciation and amortization) from our operating
results. Accordingly, this metric measures our financial
performance based on operational factors that management can impact
in the short-term, namely the cost structure, or expenses, of the
organization. EBITDA is one of the metrics used by senior
management and the Board of Directors to review the consolidated
financial performance of our business.
We define Adjusted EBITDA as EBITDA (as defined above) further
adjusted to give effect to adjustments required in calculating
covenant ratios and compliance as that term is defined in the
indenture governing our senior unsecured notes. Adjusted
EBITDA is a material component of these covenants.
Contact:
Aircastle Advisor LLC
James Connelly, SVP ESG &
Corporate Communications
Tel: +1-203-504-1871
jconnelly@aircastle.com
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SOURCE Aircastle Advisor LLC