BURLINGAME, Calif.,
May 10, 2016 /PRNewswire/
-- AeroCentury Corp. (NYSE MKT: ACY), an independent aircraft
leasing company, today reported first quarter 2016 earnings of
$434,000, or $0.28 per diluted share, compared to $752,000, or $0.48
per diluted share, for the first quarter of 2015, and $3.1
million, or $1.99 per diluted share,
for the fourth quarter of 2015. The earnings reported
for the first and fourth quarters of 2015 included $1.9 million and $6.3
million, respectively, in pretax gains on the sale of
assets. All reported results are unaudited.
Last week, the Company announced that Evan Wallach, who has served as an independent
director for nineteen years and was re-elected to the Board of
Directors at the Company's recent annual meeting of stockholders,
has been appointed to serve as Chairman of the Board of the
Company, to fill the vacancy left by the recent passing of
Neal Crispin, the Company's Founder,
Chairman and President. Toni
Perazzo, Acting President and Chief Financial Officer, noted
that "Evan's experience in finance and aviation, along with his
long-time service to the Company, make him an ideal Chairman for us
at this time."
"Competition in our niche in the aircraft leasing industry
remains high, fueled by abundant capital and new participants in
the global markets we serve," Perazzo continued. "While we
are beginning to see rationality return to capital inflows for our
asset classes, we do not expect to see the pace of our acquisitions
accelerate in the near term. Our long-term goals remain to
make strategic additions and to modernize and refresh our
portfolio."
First Quarter 2016 Highlights (at or for the periods
ended March 31, 2016, December 31, 2015 and March 31, 2015):
- Average portfolio utilization, as a percentage of net book
value of assets held for lease, remained at 95% during the first
quarter of 2016, unchanged from the fourth quarter of 2015, and up
from 88% in the year-ago quarter.
- Total revenues were $6.2 million
for the first quarter of 2016, compared to $12.7 million in the fourth quarter, and
$8.6 million in the first quarter a
year ago.
- Operating lease revenues declined 2% to $6.0 million in the first quarter of 2016 from
$6.2 million in the preceding
quarter, and declined 6% from $6.4
million a year ago, primarily as a result of asset sales in
2015.
- One aircraft was sold, pursuant to a lessee purchase option in
a sales-type finance lease, generating $5,400 in gains in the first quarter of
2016. Three aircraft were sold on a cash basis during the
fourth quarter of 2015, generating $6.3
million in gains. In the first quarter of 2015, one
aircraft was sold for cash and another was sold pursuant to a
sales-type finance lease, generating gains totaling $1.8 million.
- Total expenses decreased 30% in the first quarter of 2016
compared to the fourth quarter of 2015, and decreased 26%
year-over-year, to $5.6 million, in
both cases primarily due to lower maintenance costs. In
addition, depreciation and management fees declined, reflecting a
net decline in portfolio size due to asset sales, and interest
expense declined as a result of a lower credit facility balance and
decreased amortization of debt issuance costs during the 2016
period.
- Operating margin and net margin were 11% and 7%, respectively,
in the first quarter of 2016 compared to 38% and 24%, respectively,
for the preceding quarter, and 13% and 9%, respectively, in the
first quarter of 2015.
- Cash provided by operating activities for the first quarter of
2016 increased to $5.5 million, 87%
higher than the $3.0 million
generated in the first quarter of 2015.
- Book value per share was $26.62
at March 31, 2016, compared to
$26.35 per share at December 31, 2015, and $23.06 per share at March
31, 2015.
- Liquidity available from the revolving credit facility was
$48.2 million, up from $39.6 million a year ago. The credit facility can
be expanded by an additional $30.0
million, if needed. The increase in liquidity reflects
the repayment of credit facility from asset sales.
Perazzo remarked, "One of our newer aircraft was involved in an
on-ground accident in April 2016. No passengers or crew on
either aircraft were injured; however, the damage to our aircraft
was extensive. The aircraft was fully insured by the lessee
as required under our lease, and has been declared a total loss by
the lessee's insurer. We believe the claim will be promptly
resolved. The insurance proceeds will be used to repay the
credit facility advance used to acquire the aircraft.
Unfortunately, the total loss means that this lease will
terminate. The Company will not realize the future
anticipated lease revenue from that aircraft, and such revenue will
not be replaced until the Company is able to make additional asset
acquisitions. Until such replacement assets are acquired, the
reduction in revenue however, will be partially offset by lower
depreciation, interest expense and management fees."
The following table shows the status of the Company's portfolio
of aircraft and engines held for lease as of March 31, 2016, December
31, 2015 and March 31,
2015.
|
March 31,
2016
|
% of
net
book
value
|
December 31,
2015
|
% of
net
book
value
|
March 31,
2015
|
% of
net
book
value
|
Turboprop aircraft
(*):
|
|
|
|
|
|
|
On
lease
|
10
|
39%
|
13
|
41%
|
20
|
46%
|
Off lease -
re-leasing
|
6
|
6%
|
3
|
4%
|
5
|
5%
|
Total turboprop
aircraft
|
16
|
45%
|
16
|
45%
|
25
|
51%
|
|
|
|
|
|
|
|
Regional jet
aircraft:
|
|
|
|
|
|
|
On
lease
|
8
|
49%
|
8
|
49%
|
8
|
44%
|
Off lease -
re-leasing
|
-
|
-
|
-
|
-
|
-
|
-
|
Total regional
jet aircraft
|
8
|
49%
|
8
|
49%
|
8
|
44%
|
|
|
|
|
|
|
|
Engines:
|
|
|
|
|
|
|
On
lease
|
2
|
5%
|
2
|
5%
|
-
|
-
|
Off lease -
re-leasing
|
3
|
1%
|
3
|
1%
|
5
|
5%
|
Total
engines
|
5
|
6%
|
5
|
6%
|
5
|
5%
|
|
|
|
|
|
|
|
(*) Decreases from
period to period reflect cash sales, sales pursuant to sales-type
finance leases, and reclassifications of assets to held for
sale.
|
AeroCentury's portfolio currently consists of twenty-three
aircraft and five engines held for lease and five aircraft that are
held under sales-type finance leases. The Company also has one
aircraft and three turboprop airframes being sold as parts as
assets held for sale. The Company's portfolio consists of ten
different aircraft types. The current customer base comprises
fourteen airlines operating worldwide.
At March 31, 2016, total assets
were $176.4 million, compared to
$195.4 million a year ago, reflecting
asset sales during the past twelve months.
AeroCentury is an aircraft operating lessor and finance company
specializing in leasing regional aircraft and engines utilizing
triple net leases. The Company's aircraft and engines are leased to
regional airlines and commercial users worldwide.
This press release contains certain statements that may
include "forward-looking statements" within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, including the statements that there is no
expectation that the pace of the Company's acquisitions will
accelerate in the near term; that the Company's long term goal is
to make strategic additions and to modernize and refresh the
Company's portfolio; that the insurance claim on the aircraft
involved in the April 2016 accident
will be promptly resolved; and that the loss of revenue
anticipated from the lease for the destroyed aircraft be partially
offset by lower depreciation, interest expense and management
fees. All statements, other than
statements of historical fact, included herein are "forward-looking
statements." Although the Company believes that the expectations
reflected in these forward-looking statements are reasonable, they
do involve assumptions, risks and uncertainties, and these
expectations may prove to be incorrect. Actual results could differ
materially from those anticipated in these forward-looking
statements as a result of a variety of factors, including lack of
availability of appropriate aircraft for acquisition and financing
therefor, unanticipated delays in the insurer's claim on the
destroyed aircraft, or deficiencies in the claim paperwork
submitted by the insured lessee; and unanticipated increases in
interest under the Company's credit facility, as well as those
discussed in the Company's reports that are filed with the
Securities and Exchange Commission. You should not place undue
reliance on these forward-looking statements, which speak only as
of the date of this press release. Other than as required by law,
the Company does not assume a duty to update any forward-looking
statement.
Selected Financial
Information
|
(in thousands,
except share and per share data) (Unaudited)
|
|
|
For the Three
Months Ended
|
|
March
31,
|
December
31,
|
March
31,
|
|
2016
|
2015
|
2015
|
|
|
|
|
Operating lease
revenue
|
$6,044
|
$6,186
|
$6,438
|
Gain on disposal of
assets
|
5
|
6,331
|
1,862
|
Maintenance reserves
revenue (1)
|
-
|
-
|
327
|
Other
income
|
187
|
230
|
-
|
|
6,236
|
12,747
|
8,627
|
|
|
|
|
Depreciation
|
2,079
|
2,131
|
2,328
|
Interest
|
1,289
|
1,336
|
1,878
|
Management
fees
|
1,264
|
1,321
|
1,433
|
Professional fees and
other
|
524
|
331
|
454
|
Maintenance
costs
|
320
|
1,623
|
1,382
|
Provision for
impairment
|
75
|
1,135
|
-
|
|
5,551
|
7,877
|
7,475
|
|
|
|
|
Income before income
taxes
|
685
|
4,870
|
1,152
|
|
|
|
|
Income tax
provision
|
251
|
1,795
|
400
|
|
|
|
|
Net income
|
$434
|
$3,075
|
$752
|
|
|
|
|
Earnings per
share:
|
|
|
|
Basic
|
$0.28
|
$1.99
|
$0.49
|
Diluted
|
$0.28
|
$1.99
|
$0.48
|
|
|
|
|
Shares used in per
share computations:
|
|
|
Basic
|
1,566,699
|
1,543,257
|
1,543,257
|
Diluted
|
1,566,699
|
1,548,469
|
1,552,765
|
|
|
|
|
|
3/31/16
|
12/31/15
|
3/31/15
|
|
|
|
|
Total
assets
|
$176,387
|
$181,025
|
$195,355
|
Total
liabilities
|
$134,675
|
$139,746
|
$159,762
|
Shareholders'
equity
|
$41,712
|
$41,279
|
$35,593
|
|
|
(1)
|
Maintenance reserves
revenue is dependent upon the amount of reserves retained upon
lease terminations.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/aerocentury-corp-earns-434000-or-028-per-share-in-1q16-portfolio-utilization-remains-strong-at-95-300265632.html
SOURCE AeroCentury Corp.