STAMFORD, Conn., Feb. 14, 2017 /PRNewswire/ --
Key Financial Metrics
- Total revenues were $204.7
million for the fourth quarter of 2016 and $773.0 million for the full year
- Total lease rental1 revenues were $191.7 million for the fourth quarter and
$742.4 million for the full year
- Net income was $67.7 million, or
$0.86 per diluted common share for
the fourth quarter, and $151.5
million, or $1.92 per diluted
common share, for the full year
- Adjusted net income2 was $70.5 million, or $0.90 per diluted common share for the fourth
quarter, and $168.5 million, or
$2.14 per diluted common share, for
the full year
- Adjusted EBITDA2 was $220.5
million for the fourth quarter and $768.0 million for the full year
- Cash ROE2 of 12.3% in 2016; 8.7% net cash
interest margin
Highlights
- 206 aircraft owned and managed for joint ventures
- Acquired 60 aircraft in 2016 for $1.6
billion, including 57 narrow-body aircraft
- Sold 30 aircraft in 2016 for $755.9
million; sales included seven wide-body and three freighter
aircraft; gain on sale was $39.1
million for the full year
- Strong lease placement progress during the fourth quarter,
including three Singapore
A330s; total of two aircraft remaining to place on lease in
2017
- Raised $1.3 billion in new
financing during 2016 from funding sources worldwide
- Declared our 43rd consecutive quarterly
dividend
1 Includes finance and sales-type lease
revenue
2 Non-GAAP items reconciled in the Appendix
Aircastle Limited (the "Company" or "Aircastle") (NYSE: AYR)
reported fourth quarter 2016 net income of $67.7 million, or $0.86 per diluted common share and adjusted net
income of $70.5 million, or
$0.90 per diluted common share.
Net income for the year ended December 31,
2016 was $151.5 million, or
$1.92 per diluted common share, and
adjusted net income was $168.5
million, or $2.14 per diluted
common share. The fourth quarter results included lease
rental revenues of $191.7 million, an
increase of 3%, versus $185.7 million
in the fourth quarter of 2015. For the full year 2016, lease
rental revenues were $742.4 million,
versus $741.1 million in 2015.
"The Board is very pleased with Aircastle's strong 2016
financial performance, and the outstanding effort put forth by the
leadership team," said Peter V.
Ueberroth, Aircastle's Chairman of the Board, speaking on
behalf of the Board of Directors.
Mr. Ueberroth added, "We are all looking forward to Ron Wainshal's full recovery and to his speedy
return to the helm of our organization. The Company's
management is deep and capable, and under the current leadership of
Mike Inglese as acting CEO, we are
highly confident the team will capably execute Aircastle's business
plan."
Commenting on Aircastle's results, Mike
Inglese, Acting Chief Executive Officer, stated, "During the
fourth quarter and full year 2016, Aircastle achieved solid
earnings growth and generated a strong cash return on equity. At
the same time, we seized on opportunities in a dynamic market
environment, further expanding the fleet and significantly
improving asset quality as we continue to de-risk the
business."
Mr. Inglese continued, "Aircastle took important steps to
profitably grow the Company in 2016, with an emphasis on
capitalizing on attractive narrow-body opportunities.
Specifically, we completed $1.6
billion in aircraft acquisitions during the year, with more
than $600 million closing in the
fourth quarter. Profitable sales also remained a priority for
Aircastle in 2016, as we sold 30 aircraft and further reduced our
exposure to the wide-body and freighter markets."
Mr. Inglese concluded, "We enter 2017 in a strong position with
a lot of flexibility. We have significantly transformed our
portfolio to focus on narrow-body aircraft, continued to
successfully place aircraft and have limited capital
commitments. Our success raising $1.3
billion in financing during 2016 has also provided Aircastle
with significant liquidity to continue to grow the Company and
opportunistically provide value-added solutions to potential
sellers of aircraft."
Financial Results
(in thousands, except
share data)
|
Three Months
Ended
December
31,
|
|
Year
Ended
December
31,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
Total
Revenues
|
$ 204,653
|
|
$ 208,267
|
|
$ 772,958
|
|
$ 819,202
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$ 220,493
|
|
$ 210,972
|
|
$ 767,953
|
|
$ 832,105
|
|
|
|
|
|
|
|
|
Net income
|
$
67,724
|
|
$
50,641
|
|
$
151,453
|
|
$
121,729
|
Per common share –
Diluted
|
$
0.86
|
|
$
0.63
|
|
$
1.92
|
|
$
1.50
|
|
|
|
|
|
|
|
|
Adjusted net
income
|
$
70,525
|
|
$
54,264
|
|
$
168,527
|
|
$
142,271
|
Per common share –
Diluted
|
$
0.90
|
|
$
0.67
|
|
$
2.14
|
|
$
1.75
|
Fourth Quarter Results
Total revenues for the fourth quarter were $204.7 million, a decline of $3.6 million, driven by lower maintenance revenue
and lease end termination fees. Maintenance revenues in the
fourth quarter of 2015 were $2.9
million higher versus the current year's fourth quarter due
to an unscheduled lease termination with an airline in Russia in the prior year.
Net income for the quarter was $67.7
million, up $17.1 million
year-over-year, while adjusted net income was $70.5 million, an increase of $16.3 million. The improvement in both was
due to a $16.1 million reduction in
non-cash impairment charges along with higher gains on the sale of
flight equipment of $9.2 million,
partially offset by higher interest expense of $7.7 million.
Adjusted EBITDA for the fourth quarter was $220.5 million, up $9.5
million, due to $9.2 million
of higher gains on sale of flight equipment in 2016 versus
2015.
Full Year Results
Lease rental revenues totaled $742.4
million, an increase of $1.3
million versus the previous year. Total revenues in
2016 were $773.0 million, a decline
of $46.2 million versus the previous
year. The decrease in total revenues was driven by a
$37.5 million reduction in
maintenance revenues and a $10.4
million decline in lease end termination fees due to a lower
number of aircraft that came off lease during 2016 compared to the
previous year.
Net income for the full year was $151.5
million, up $29.7 million
year-over-year, while adjusted net income was $168.5 million, an increase of $26.3 million. The improvements were
primarily driven by a $91.3 million
reduction in non-cash aircraft impairment charges, partially offset
by lower maintenance revenues, lower gain on sale and lower lease
termination fees, which declined a combined $66.8 million.
Adjusted EBITDA for the full year was $768.0 million, down $64.2
million versus 2015, reflecting a $37.5 million decline in maintenance revenue,
lower gains from the sale of flight equipment of $18.9 million, and a $10.4
million decrease in lease termination fees mainly associated
with the disposal of freighter aircraft during 2015.
Aviation Assets
During 2016, we acquired 60 aircraft for $1.6 billion, including 28 aircraft for
$635.8 million during the fourth
quarter. The average age of the aircraft acquired during 2016
was 7.4 years and the leases had an average remaining term of
approximately 5.4 years. Of the 60 aircraft purchased during
the year, 57 aircraft were narrow-bodies.
We currently have acquired or committed to acquire three
aircraft in 2017 for $137.3
million. Including our order commitment with Embraer
for 25 E-2 aircraft, we have commitments to acquire a total of 28
aircraft for $1.1 billion through
2021.
During 2016, we sold 30 aircraft for net proceeds of
$755.9 million, and realized a gain
on the sale of flight equipment of $39.1
million. The average age of the aircraft sold during
2016, excluding sales to our joint ventures, was 15.0 years.
In the fourth quarter of 2016, we completed the sale of eleven
aircraft, including two wide-body and one freighter aircraft.
Full year sales included seven wide-body and three freighter
aircraft. Our portfolio sales reduced our freighter exposure
to eight aircraft, accounting for 8% of our total fleet net book
value.
As of December 31, 2016, Aircastle
owned 193 aircraft having a net book value of $6.5 billion. We also managed thirteen aircraft
with a net book value of $689 million
on behalf of our joint ventures with Ontario Teachers' Pension Plan
and IBJ Ltd. of Japan.
Owned
Aircraft
|
As
of
December 31,
2016(1)
|
|
As
of
December 31,
2015(1)
|
|
As
of
December 31,
2014(1)
|
|
|
|
|
|
|
Total Flight
Equipment Held for Lease ($ mils.)
|
$
|
6,508
|
|
|
$
|
6,068
|
|
|
$
|
5,686
|
|
Unencumbered Flight
Equipment Held for Lease ($ mils.)
|
$
|
4,614
|
|
|
$
|
3,928
|
|
|
$
|
3,341
|
|
Number of
Aircraft
|
193
|
|
|
162
|
|
|
148
|
|
Number of
Unencumbered Aircraft
|
156
|
|
|
118
|
|
|
95
|
|
Weighted Average
Fleet Age (years)(2)
|
7.9
|
|
|
7.5
|
|
|
8.4
|
|
Weighted Average
Remaining Lease Term
(years)(2)
|
5.1
|
|
|
5.9
|
|
|
5.4
|
|
Weighted Average
Fleet Utilization for the year
ended(3)
|
98.9%
|
|
|
99.3%
|
|
|
99.6%
|
|
Portfolio Yield for
the year ended(4)
|
12.4%
|
|
|
12.7%
|
|
|
13.4%
|
|
Net Cash Interest
Margin(5)
|
8.7%
|
|
|
9.2%
|
|
|
10.1%
|
|
|
|
|
|
|
|
|
|
|
Managed Aircraft on
behalf of Joint Ventures
|
|
|
|
|
|
|
|
|
Flight
Equipment
|
$
689
|
|
|
$
484
|
|
|
$
505
|
|
Number of
Aircraft
|
13
|
|
|
5
|
|
|
5
|
|
|
|
|
|
(1)
|
Calculated using net
book value of flight equipment held for lease and net investment in
finance leases at period end.
|
(2)
|
Weighted by net book
value.
|
(3)
|
Aircraft on-lease
days as a percent of total days in period weighted by net book
value.
|
(4)
|
Lease rental revenue,
interest income and cash collections on our net investment in
finance and sales-type leases for the period as a percent of the
average net book value for the period; quarterly information is
annualized. Based on the growing level of finance and
sales-type lease revenue, management revised the calculation of
portfolio yield to include our net investment in finance and
sales-type leases in the average net book value and to include the
interest income and cash collections on our net investment in
finance and sales-type leases in lease rentals.
|
(5)
|
Net Cash Interest
Margin = Lease rental yield plus finance lease revenue and
collections minus interest on borrowings, net of settlements on
interest rate derivatives, and other liabilities / average
NBV of flight equipment for the period calculated on a quarterly
basis, annualized.
|
2016 Financing Activity
We raised $1.3 billion of new
financing during 2016. This included $500 million of Senior Notes due in 2023,
$434 million of secured bank
financing in Europe and a
$135 million unsecured revolving
credit facility in the Asian market. We also raised
$120 million of unsecured financing
with Japanese banks and increased the size of our existing
revolving credit facility by $75 million to
$675 million. The capital raised during the year
provides us with an enhanced liquidity profile and significant
financial flexibility.
Common Dividend
On February 9, 2017, Aircastle's
Board of Directors declared a first quarter 2017 cash dividend on
its common shares of $0.26 per share,
payable on March 15, 2017 to
shareholders of record on February
28, 2017. Since 2011, Aircastle has increased the
dividend seven times for a total increase of 260% over that
period.
Conference Call
In connection with this earnings release, management will host
an earnings conference call on Tuesday,
February 14, 2017 at 10:00 A.M.
Eastern time. All interested parties are welcome to
participate on the live call. The conference call can be
accessed by dialing (877) 741-4244 (from within the U.S. and
Canada) or (719) 325-4834 (from
outside of the U.S. and Canada)
ten minutes prior to the scheduled start and referencing the
passcode "7920472".
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. A replay of the webcast will be available for one
month following the call. In addition to this earnings
release an accompanying power point presentation has been posted to
the Investor Relations section of Aircastle's website.
For those who are not available to listen to the live call, a
replay will be available until 1:00 P.M.
Eastern time on Thursday, March 16,
2017 by dialing (888) 203-1112 (from within the U.S. and
Canada) or (719) 457-0820
(from outside of the U.S. and Canada); please reference passcode
"7920472".
About Aircastle Limited
Aircastle Limited acquires, leases and sells commercial jet
aircraft to airlines throughout the world. As of December 31, 2016, Aircastle owned and managed on
behalf of its joint ventures 206 aircraft leased to 71 customers
located in 36 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, Adjusted EBITDA, Adjusted Net Income,
Cash Return on Equity and Net Cash Interest Margin 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 2015 Annual Report on Form
10- K. 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)
|
|
|
|
December 31,
|
|
2016
|
|
2015
|
ASSETS
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
455,579
|
|
|
$
|
155,904
|
|
Accounts
receivable
|
6,035
|
|
|
8,566
|
|
Restricted cash and
cash equivalents
|
53,238
|
|
|
98,137
|
|
Restricted liquidity
facility collateral
|
—
|
|
|
65,000
|
|
Flight equipment held
for lease, net of accumulated depreciation of $1,224,899 and
$1,306,024,
respectively
|
6,247,585
|
|
|
5,867,062
|
|
Net investment in
finance and sales-type leases
|
260,853
|
|
|
201,211
|
|
Unconsolidated equity
method investment
|
72,977
|
|
|
50,377
|
|
Other
assets
|
148,398
|
|
|
123,707
|
|
Total
assets
|
$
|
7,244,665
|
|
|
$
|
6,569,964
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
Borrowings from
secured financings, net of debt issuance costs
|
$
|
1,219,034
|
|
$
|
|
1,146,238
|
|
Borrowings from
unsecured financings, net of debt issuance costs
|
3,287,211
|
|
|
2,894,918
|
|
Accounts payable,
accrued expenses and other liabilities
|
127,527
|
|
|
131,058
|
|
Lease rentals
received in advance
|
62,225
|
|
|
67,327
|
|
Liquidity
facility
|
—
|
|
|
65,000
|
|
Security
deposits
|
122,597
|
|
|
115,642
|
|
Maintenance
payments
|
591,757
|
|
|
370,281
|
|
Total
liabilities
|
5,410,351
|
|
|
4,790.464
|
|
|
|
|
|
|
|
Commitments and
Contingencies
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY
|
|
|
|
|
|
Preference shares,
$.01 par value, 50,000,000 shares authorized, no shares
issued and outstanding
|
—
|
|
|
—
|
|
Common shares,
$.01 par value, 250,000,000 shares authorized,
78,593,133 shares issued and outstanding at December 31,
2016; and 80,232,260 shares issued and outstanding at
December 31, 2015
|
786
|
|
|
802
|
|
Additional paid-in
capital
|
1,521,190
|
|
|
1,550,337
|
|
Retained
earnings
|
315,890
|
|
|
241,574
|
|
Accumulated other
comprehensive loss
|
(3,552)
|
|
|
(13,213)
|
|
Total shareholders'
equity
|
1,834,314
|
|
|
1,779,500
|
|
Total liabilities and
shareholders' equity
|
$
|
7,244,665
|
|
|
$
|
6,569,964
|
|
Aircastle Limited
and Subsidiaries
|
Consolidated
Statements of Income
|
(Dollars in
thousands, except per share amounts)
|
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
December 31,
|
|
Year
Ended
December
31,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
Lease rental
revenue
|
$
|
187,550
|
|
$
|
|
183,394
|
|
|
$
|
725,220
|
|
|
$
|
733,417
|
|
Finance and
sales-type lease revenue
|
4,164
|
|
|
2,306
|
|
|
17,190
|
|
|
7,658
|
|
Amortization of lease
premiums, discounts and lease incentives
|
(4,934)
|
|
|
(376)
|
|
|
(10.353)
|
|
|
(10,664)
|
|
Maintenance
revenue
|
12,987
|
|
|
15,901
|
|
|
33,590
|
|
|
71,049
|
|
Total lease
revenue
|
199,767
|
|
|
201,225
|
|
|
765,647
|
|
|
801,460
|
|
Other
revenue
|
4,886
|
|
|
7,042
|
|
|
7,311
|
|
|
17,742
|
|
Total
revenues
|
204,653
|
|
|
208,267
|
|
|
772,958
|
|
|
819,202
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation
|
77,298
|
|
|
81,245
|
|
|
305,216
|
|
|
318,783
|
|
Interest,
net
|
67,170
|
|
|
59,514
|
|
|
255,660
|
|
|
243,577
|
|
Selling, general and
administrative (including non-cash share based
payment expense of $2,105 and $1,556 for the three months ended
and $7,901 and $5,537 for the twelve months ended December 31,
2016 and 2015, respectively)
|
14,989
|
|
|
13,535
|
|
|
61,872
|
|
|
56,198
|
|
Impairment of
aircraft
|
1,400
|
|
|
17,477
|
|
|
28,585
|
|
|
119,835
|
|
Maintenance and other
costs
|
2,269
|
|
|
2,376
|
|
|
7,773
|
|
|
11,502
|
|
Total
expenses
|
163,126
|
|
|
174,147
|
|
|
659,106
|
|
|
749,895
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
|
|
|
Gain on sale of
flight equipment
|
24,194
|
|
|
14,983
|
|
|
39,126
|
|
|
58,017
|
|
Other
|
3,663
|
|
|
578
|
|
|
3,527
|
|
|
919
|
|
Total other income
(expense)
|
27,857
|
|
|
15,561
|
|
|
42,653
|
|
|
58,936
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
continuing operations before income taxes
|
69,384
|
|
|
49,681
|
|
|
156,505
|
|
|
128,243
|
|
Income tax
provision
|
3,525
|
|
|
734
|
|
|
12,307
|
|
|
12,771
|
|
Earnings of
unconsolidated equity method investment, net of tax
|
1,865
|
|
|
1,694
|
|
|
7,255
|
|
|
6,257
|
|
Net income
|
$
|
67,724
|
|
|
$
|
50,641
|
|
|
$
|
151,453
|
|
|
$
|
121,729
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common
share — Basic:
|
|
|
|
|
|
|
|
|
|
|
|
Net income per
share
|
$
|
0.86
|
|
|
$
|
0.63
|
|
|
$
|
1.92
|
|
|
$
|
1.50
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common
share — Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
Net income per
share
|
$
|
0.86
|
|
|
$
|
0.63
|
|
|
$
|
1.92
|
|
|
$
|
1.50
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends declared
per share
|
$
|
0.26
|
|
|
$
|
0.24
|
|
|
$
|
0.98
|
|
|
$
|
0.90
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aircastle Limited
and Subsidiaries
|
Consolidated
Statements of Cash Flows
|
(Dollars in
thousands)
|
|
Year Ended
December 31,
|
|
|
2016
|
|
2015
|
Cash flows from
operating activities:
|
|
|
|
|
|
Net income
|
$
|
151,453
|
|
$
|
|
121,729
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
Depreciation
|
305,216
|
|
|
318,783
|
|
Amortization of
deferred financing costs
|
18,508
|
|
|
14,878
|
|
Amortization of net
lease discounts and lease incentives
|
10,353
|
|
|
10,664
|
|
Deferred income
taxes
|
6,156
|
|
|
(6,889)
|
|
Non-cash share based
payment expense
|
7,901
|
|
|
5,537
|
|
Cash flow hedges
reclassified into earnings
|
9,662
|
|
|
24,023
|
|
Security deposits and
maintenance payments included in earnings
|
(23,123)
|
|
|
(35,843)
|
|
Gain on the sale of
flight equipment
|
(39,126)
|
|
|
(58,017)
|
|
Impairment of
aircraft
|
28,585
|
|
|
119,835
|
|
Other
|
(6,867)
|
|
|
(896)
|
|
Changes on certain
assets and liabilities:
|
|
|
|
|
|
Accounts
receivable
|
832
|
|
|
(5,406)
|
|
Other
assets
|
(1,089)
|
|
|
(5,033)
|
|
Accounts payable,
accrued expenses and other liabilities
|
(4,014)
|
|
|
7,255
|
|
Lease rentals
received in advance
|
3,645
|
|
|
15,665
|
|
Net cash provided by
operating activities
|
468,092
|
|
|
526,285
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
Acquisition and
improvement of flight equipment
|
(1,331,059)
|
|
|
(1,320,669)
|
|
Proceeds from sale of
flight equipment
|
755,898
|
|
|
562,518
|
|
Restricted cash and
cash equivalents related to sale of flight equipment
|
17,000
|
|
|
(17,000)
|
|
Aircraft purchase
deposits and progress payments, net of returned deposits and
aircraft sales deposits
|
(9,628)
|
|
|
(6,812)
|
|
Net investment in
finance leases
|
(78,892)
|
|
|
(91,648)
|
|
Collections on
finance leases
|
19,413
|
|
|
9,559
|
|
Unconsolidated equity
method investment and associated costs
|
(18,048)
|
|
|
—
|
|
Other
|
(839)
|
|
|
(610)
|
|
Net cash used in
investing activities
|
(646,155)
|
|
|
(864,662)
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
Repurchase of
shares
|
(37,337)
|
|
|
(20,881)
|
|
Proceeds from secured
and unsecured debt financings
|
1,054,250
|
|
|
975,000
|
|
Repayments of secured
and unsecured debt financings
|
(588,778)
|
|
|
(681,393)
|
|
Deferred financing
costs
|
(18,890)
|
|
|
(11,881)
|
|
Restricted secured
liquidity facility collateral
|
65,000
|
|
|
—
|
|
Liquidity
facility
|
(65,000)
|
|
|
—
|
|
Restricted cash and
cash equivalents related to financing activities
|
27,899
|
|
|
17,747
|
|
Security deposits and
maintenance payments received
|
171,672
|
|
|
152,391
|
|
Security deposits and
maintenance payments returned
|
(51,658)
|
|
|
(33,398)
|
|
Other
|
(2,283)
|
|
|
—
|
|
Dividends
paid
|
(77,137)
|
|
|
(72,960)
|
|
Net cash provided by
(used in) financing activities
|
477,738
|
|
|
324,625
|
|
Net increase in
cash and cash equivalents
|
299,675
|
|
|
(13,752)
|
|
Cash and cash
equivalents at beginning of year
|
155,904
|
|
|
169,656
|
|
Cash and cash
equivalents at end of year
|
$
|
455,579
|
|
|
$
|
155,904
|
|
Aircastle Limited
and Subsidiaries
|
Supplemental
Financial Information
|
(Amount in
thousands, except per share amounts)
|
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
December
31,
|
|
Year
Ended
December
31,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
Revenues
|
$ 204,653
|
|
$ 208,267
|
|
$ 772,958
|
|
$ 819,202
|
|
|
|
|
|
|
|
|
EBITDA1
|
$ 220,651
|
|
$ 192,510
|
|
$ 734,989
|
|
$ 707,524
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA1
|
$ 220,493
|
|
$ 210,972
|
|
$ 767,953
|
|
$ 832,105
|
|
|
|
|
|
|
|
|
Adjusted net
income1
|
$
70,525
|
|
$
54,264
|
|
$ 168,527
|
|
$ 142,271
|
|
|
|
|
|
|
|
|
Adjusted net income
allocable to common shares1
|
$
69,918
|
|
$
53,828
|
|
$ 167,129
|
|
$ 141,191
|
Per common share –
Basic
|
$
0.90
|
|
$
0.67
|
|
$
2.14
|
|
$
1.75
|
Per common share –
Diluted
|
$
0.90
|
|
$
0.67
|
|
$
2.14
|
|
$
1.75
|
|
|
|
|
|
|
|
|
Basic common shares
outstanding
|
77,957
|
|
80,263
|
|
78,161
|
|
80,489
|
Diluted common shares
outstanding
|
78,021
|
|
80,263
|
|
78,204
|
|
80,489
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 Refer to
the selected information accompanying this press release for a
reconciliation of GAAP to Non-GAAP information.
|
Aircastle Limited
and Subsidiaries
|
Reconciliation of
GAAP to Non-GAAP Measures
|
EBITDA and
Adjusted EBITDA Reconciliation
|
(Dollars in
thousands)
|
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
December 31,
|
|
Year
Ended
December
31,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
(Dollars in
thousands)
|
Net income
|
$
|
67,724
|
|
|
$
|
50,641
|
|
|
$
|
151,453
|
|
|
$
|
121,729
|
|
Depreciation
|
77,298
|
|
|
81,245
|
|
|
305,216
|
|
|
318,783
|
|
Amortization of net
lease discounts and lease incentives
|
4,934
|
|
|
376
|
|
|
10,353
|
|
|
10,664
|
|
Interest,
net
|
67,170
|
|
|
59,514
|
|
|
255,660
|
|
|
243,577
|
|
Income tax
provision
|
3,525
|
|
|
734
|
|
|
12,307
|
|
|
12,771
|
|
EBITDA
|
$
|
220,651
|
|
|
$
|
192,510
|
|
|
$
|
734,989
|
|
|
$
|
707,524
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
Impairment of
aircraft
|
1,400
|
|
|
17,477
|
|
|
28,585
|
|
|
119,835
|
|
Non-cash
share-based payment expense
|
2,105
|
|
|
1,556
|
|
|
7,901
|
|
|
5,537
|
|
Gain on
mark-to-market of interest rate derivative contracts
|
(3,663)
|
|
|
(571)
|
|
|
(3,522)
|
|
|
(791)
|
|
Adjusted EBITDA
|
$
|
220,493
|
|
|
$
|
210,972
|
|
|
$
|
767,953
|
|
|
$
|
832,105
|
|
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-US 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.
Aircastle Limited
and Subsidiaries
|
Reconciliation of
GAAP to Non-GAAP Measures
|
Adjusted Net
Income Reconciliation
|
(Dollars in
thousands)
|
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
December 31,
|
|
Year
Ended
December
31,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
(Dollars in
thousands)
|
Net income
|
$
|
67,724
|
|
|
$
|
50,641
|
|
|
$
|
151,453
|
|
|
$
|
121,729
|
|
Ineffective portion
and termination of hedges(1)
|
—
|
|
|
(54)
|
|
|
—
|
|
|
455
|
|
Gain on mark-to-market
of interest rate derivative contracts(2)
|
(3,663)
|
|
|
(571)
|
|
|
(3,522)
|
|
|
(791)
|
|
Loan termination
fee(1)
|
3,451
|
|
|
—
|
|
|
4,960
|
|
|
—
|
|
Write-off of deferred
financing fees(1)
|
908
|
|
|
—
|
|
|
2,880
|
|
|
—
|
|
Non-cash share-based
payment expense(3)
|
2,105
|
|
|
1,556
|
|
|
7,901
|
|
|
5,537
|
|
Term
Financing No. 1 hedge loss amortization
charges(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
4,401
|
|
Securitization No. 1 hedge loss amortization charges
(1)
|
—
|
|
|
2,692
|
|
|
4,855
|
|
|
10,940
|
|
Adjusted net
income
|
$
|
70,525
|
|
|
$
|
54,264
|
|
|
$
|
168,527
|
|
|
$
|
142,271
|
|
|
|
|
|
(1)
|
Included in Interest,
net.
|
(2)
|
Included in Other
income (expense).
|
(3)
|
Included in Selling,
general and administrative expenses.
|
Management believes that Adjusted Net Income ("ANI") when viewed
in conjunction with the Company's results under U.S. GAAP and the
above reconciliation, provides useful information about operating
and period-over-period performance, and provides additional
information that is useful for evaluating the underlying operating
performance of our business without regard to periodic reporting
elements related to interest rate derivative accounting, changes
related to refinancing activity and non-cash share-based payment
expense.
Aircastle Limited
and Subsidiaries
|
Reconciliation of
GAAP to Non-GAAP Measures
|
Cash Return on
Equity Calculation
|
(Dollars in
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
CFFO
|
Finance Lease
Collections
|
Gain (Loss) on Sale
of Eqt.
|
Deprec.
|
Distributions in
excess (less than) Equity Earnings
|
Cash
Earnings
|
Average Shareholders'
Equity
|
12 Month Cash
ROE
|
2011
|
$359,377
|
|
$39,092
|
$242,103
|
|
$156,366
|
$1,370,513
|
11.4%
|
2012
|
$427,277
|
$3,852
|
$5,747
|
$269,920
|
|
$166,956
|
$1,425,658
|
11.7%
|
2013
|
$424,037
|
$9,508
|
$37,220
|
$284,924
|
|
$185,841
|
$1,513,156
|
12.3%
|
2014
|
$458,786
|
$10,312
|
$23,146
|
$299,365
|
$667
|
$193,546
|
$1,661,228
|
11.7%
|
2015
|
$526,285
|
$9,559
|
$58,017
|
$318,783
|
($530)
|
$274,548
|
$1,759,871
|
15.6%
|
2016
|
$468,092
|
$19,413
|
$39,126
|
$305,216
|
($1,782)
|
$219,633
|
$1,789,256
|
12.3%
|
|
|
|
|
|
|
|
|
|
Note: LTM Average Shareholders' Equity is the average of
the most recent five quarters period end Shareholders'
Equity. Management believes that the cash return on equity
metric (Cash ROE) when viewed in conjunction with the
Company's results under US GAAP and the above reconciliation,
provide useful information about operating and period-over-period
performance, and provide additional information that is useful for
evaluating the underlying operating performance of our business
without regard to periodic reporting impacts related to non-cash
revenue and expense items and interest rate derivative accounting,
while recognizing the depreciating nature of our assets.
Aircastle Limited
and Subsidiaries
|
Reconciliation of
GAAP to Non-GAAP Measures
|
Net Cash Interest
Margin Calculation
|
(Dollars in
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Average
NBV
|
|
Quarterly
Rental
Revenue
|
|
Cash
Interest(1)
|
|
Annualized Net
Cash Interest
Margin(2)
|
Q1:11
|
|
$
4,041,967
|
|
$
141,116
|
|
$
41,278
|
|
9.9%
|
Q2:11
|
|
$
4,143,446
|
|
$
143,356
|
|
$
40,021
|
|
10.0%
|
Q3:11
|
|
$
4,222,512
|
|
$
145,890
|
|
$
42,066
|
|
9.8%
|
Q4:11
|
|
$
4,374,921
|
|
$
149,848
|
|
$
43,041
|
|
9.8%
|
Q1:12
|
|
$
4,388,008
|
|
$
152,242
|
|
$
44,969
|
|
9.8%
|
Q2:12
|
|
$
4,542,477
|
|
$
156,057
|
|
$
48,798
|
|
9.4%
|
Q3:12
|
|
$
4,697,802
|
|
$
163,630
|
|
$
41,373
|
|
10.4%
|
Q4:12
|
|
$
4,726,457
|
|
$
163,820
|
|
$
43,461
|
|
10.2%
|
Q1:13
|
|
$
4,740,161
|
|
$
162,319
|
|
$
48,591
|
|
9.6%
|
Q2:13
|
|
$
4,840,396
|
|
$
164,239
|
|
$
44,915
|
|
9.9%
|
Q3:13
|
|
$
4,863,444
|
|
$
167,876
|
|
$
47,682
|
|
9.9%
|
Q4:13
|
|
$
5,118,601
|
|
$
176,168
|
|
$
49,080
|
|
9.9%
|
Q1:14
|
|
$
5,312,651
|
|
$
181,095
|
|
$
51,685
|
|
9.7%
|
Q2:14
|
|
$
5,721,521
|
|
$
190,574
|
|
$
48,172
|
|
10.0%
|
Q3:14
|
|
$
5,483,958
|
|
$
182,227
|
|
$
44,820
|
|
10.0%
|
Q4:14
|
|
$
5,468,637
|
|
$
181,977
|
|
$
44,459
|
|
10.1%
|
Q1:15
|
|
$
5,743,035
|
|
$
181,027
|
|
$
50,235
|
|
9.1%
|
Q2:15
|
|
$
5,967,898
|
|
$
189,238
|
|
$
51,413
|
|
9.2%
|
Q3:15
|
|
$
6,048,330
|
|
$
191,878
|
|
$
51,428
|
|
9.3%
|
Q4:15
|
|
$
5,962,874
|
|
$
188,491
|
|
$
51,250
|
|
9.2%
|
Q1:16
|
|
$
5,988,076
|
|
$
186,730
|
|
$
51,815
|
|
9.0%
|
Q2:16
|
|
$
5,920,030
|
|
$
184,469
|
|
$
55,779
|
|
8.7%
|
Q3:16
|
|
$
6,265,175
|
|
$
193,909
|
|
$
57,589
|
|
8.7%
|
Q4:16
|
|
$
6,346,361
|
|
$
196,714
|
|
$
58,631
|
|
8.7%
|
|
|
|
|
|
|
|
|
|
- Excludes loan termination payments of $3.2 million and $3.0
million in the second quarter of 2011 and 2013
respectively. Also excludes loan termination payments of
$1.5 million and $3.5 million in the first quarter and fourth
quarter of 2016 respectively.
- Net Cash Interest Margin = Lease rental yield plus finance
lease revenue and collections minus interest on borrowings, net of
settlements on interest rate derivatives, and other
liabilities / average NBV of flight equipment for the period
calculated on a quarterly basis, annualized. Based on
the growing level of finance and sales-type lease revenue,
management revised the calculation of portfolio yield to include
our net investment in finance and sales-type leases in the average
net book value and to include the interest income and cash
collections on our net investment in finance and sales-type leases
in lease rentals.
Management believes that net cash interest margin, when
viewed in conjunction with the Company's results under U.S. GAAP
and the above reconciliation, provides useful information about the
effective deployment of our capital in the context of the yield on
our aircraft assets, the utilization of those assets by our
lessees, and our ability to borrow efficiently.
Aircastle Limited
and Subsidiaries
|
Selected Financial
Guidance Elements for the First Quarter of 2017
|
($ in millions,
except for percentages)
|
(Unaudited)
|
|
|
Guidance
Item
|
Q1:17
|
Lease rental
revenue
|
$188 -
$192
|
Finance lease
revenue
|
$4 - $5
|
Maintenance
revenue
|
$4 - $12
|
Amortization of net
lease discounts and lease incentives
|
($2) –
($3)
|
SG&A1
|
$15 - $16
|
Depreciation
|
$77 - $79
|
Interest,
net
|
$61 - $63
|
Gain on
sale
|
$7 - $11
|
Full year effective
tax rate
|
9% - 11%
|
|
|
|
1. Includes ~$2.4M of
non-cash share based payment expense.
|
Aircastle Limited
and Subsidiaries
|
Reconciliation of
GAAP to Non-GAAP Measures
|
Reconciliation of
Net Income Allocable to Common Shares
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
Three Months
Ended
December 31,
2016
|
|
Year
Ended
December 31,
2016
|
|
Weighted-average
shares(1) - Basic:
|
Shares
|
|
Percent(2)
|
|
Shares
|
|
Percent(2)
|
|
Common shares
outstanding – Basic
|
77,957
|
|
|
99.14%
|
|
|
78,161
|
|
|
99.17%
|
|
Unvested restricted
common shares
|
677
|
|
|
0.86%
|
|
|
654
|
|
|
0.83%
|
|
Total
weighted-average shares outstanding
|
78,634
|
|
|
100.00%
|
|
|
78,815
|
|
|
100.00%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
allocation
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$ 67,724
|
|
|
100.00%
|
|
|
$151,453
|
|
|
100.00%
|
|
Distributed and
undistributed earnings allocated to unvested restricted
shares
|
(583)
|
|
|
(0.86%)
|
|
|
(1,257)
|
|
|
(0.83%)
|
|
Earnings available to
common shares
|
$ 67,141
|
|
|
99.14%
|
|
|
$150,1966
|
|
|
99.17%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net
income allocation
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net
income
|
$ 70,525
|
|
|
100.00%
|
|
|
$168,527
|
|
|
100.00%
|
|
Amounts allocated to
unvested restricted shares
|
(607)
|
|
|
(0.86%)
|
|
|
(1,398)
|
|
|
(0.83%)
|
|
Amounts allocated to
common shares
|
$ 69,918
|
|
|
99.14%
|
|
|
$167,129
|
|
|
99.17%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
For the three and
twelve months ended December 31, 2016, dilutive shares represented
contingently issuable shares related to the Company's
PSUs.
|
(2)
|
Percentages rounded
to two decimal places.
|
Aircastle Limited
and Subsidiaries
|
Reconciliation of
GAAP to Non-GAAP Measures
|
Reconciliation of
Net Income Allocable to Common Shares
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
Three Months
Ended
December 31,
2015
|
|
Year
Ended
December 31,
2015
|
|
Weighted-average
shares:
|
Shares
|
|
Percent(1)
|
|
Shares
|
|
Percent(1)
|
|
Common shares
outstanding – Basic
|
80,263
|
|
|
99.20%
|
|
|
80,489
|
|
|
99.24%
|
|
Unvested restricted
common shares
|
650
|
|
|
0.80%
|
|
|
616
|
|
|
0.76%
|
|
Total
weighted-average shares outstanding
|
80,912
|
|
|
100.00%
|
|
|
81,105
|
|
|
100.00%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
allocation
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$50,641
|
|
|
100.00%
|
|
|
$121,729
|
|
|
100.00%
|
|
Distributed and
undistributed earnings allocated to unvested restricted
shares
|
(407)
|
|
|
(0.80%)
|
|
|
(924)
|
|
|
(0.76%)
|
|
Earnings available to
common shares
|
$50,234
|
|
|
99.20%
|
|
|
$120,805
|
|
|
99.24%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net
income allocation
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net
income
|
$54,264
|
|
|
100.00%
|
|
|
$142,271
|
|
|
100.00%
|
|
Amounts allocated to
unvested restricted shares
|
(436)
|
|
|
(0.80%)
|
|
|
(1,080)
|
|
|
(0.76%)
|
|
Amounts allocated to
common shares
|
$53,828
|
|
|
99.20%
|
|
|
$141,191
|
|
|
99.24%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Percentages rounded to
two decimal places.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contact:
|
|
Aircastle Advisor
LLC
|
The IGB
Group
|
Frank Constantinople,
SVP Investor Relations
|
Leon
Berman
|
Tel:
+1-203-504-1063
|
Tel:
+1-212-477-8438
|
fconstantinople@aircastle.com
|
lberman@igbir.com
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/aircastle-announces-fourth-quarter-and-full-year-2016-results-300406689.html
SOURCE Aircastle Limited