STAMFORD, Conn., Nov. 3, 2015 /PRNewswire/ --
Key Third Quarter Developments
- Lease rental and finance lease revenue was $189.9 million, up 5.3%
- Net loss was $(14.0) million, or
$(0.17) per diluted share
- Excluding the $66.0 million
earnings impact from Malaysian Airline System bankruptcy and older
freighter exits, net income was $52.0
million, or $0.64 per
share
- Accelerated planned exit from freighters by agreeing or
completing sale of four aircraft and declaring six remaining older
units to be on last leases after which we expect to scrap them
- Cash ROE was 14.5%, net cash interest margin was 9.2% and fleet
utilization was 99.9%
- Acquired seven aircraft for $233
million; year to date purchased 32 aircraft for $1.0 billion
- Sold eight aircraft for a net gain of $15.7 million; year to date sold 20 aircraft for
a total net pre-tax contribution of $38.3
million
- Declared $0.24 dividend per
common share; our 38th consecutive quarterly
dividend
Aircastle Limited (the "Company" or "Aircastle") (NYSE: AYR)
reported a third quarter 2015 net loss of $(14.0) million, or $(0.17) per diluted common share, and an adjusted
net loss of $(9.7) million, or
$(0.12) per diluted common
share. The third quarter results included total revenues of
$212.1 million, an increase of 19.4%,
versus $177.6 million in the third
quarter of 2014.
Commenting on the results, Ron
Wainshal, Aircastle's CEO, stated "During the third quarter
we took decisive measures to address the challenge presented by the
Malaysian bankruptcy and to accelerate our planned exit from
freighter investments. Notwithstanding the resulting
impairments, our operating performance was excellent as evidenced
by the 14.5% cash ROE and 99.9% utilization results."
Mr. Wainshal added, "Increased asset sales have been a key
driver for our results as we've seized on robust investor demand
for aircraft both to enhance our financial performance and to
improve our portfolio quality considerably."
Mr. Wainshal concluded, "We continue to demonstrate the value of
the Aircastle franchise and our distinct competitive positioning by
originating an attractive flow of investments we believe will have
an accretive long-term earnings profile. This capability, together
with the improving quality of our assets and strong operating cash
flows, gave us confidence to increase our dividend once
again."
Note: Non-GAAP items reconciled in the Appendix.
Financial Results
(in thousands, except
share data)
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
Total
Revenues
|
$ 212,074
|
|
$ 177,596
|
|
$ 610,935
|
|
$ 580,345
|
|
|
|
|
|
|
|
|
Lease Rental and
Finance Lease Revenues
|
$ 189,906
|
|
$ 180,349
|
|
$ 555,375
|
|
$ 545,799
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$ 216,311
|
|
$ 177,408
|
|
$ 621,133
|
|
$ 559,083
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$ (13,989 )
|
|
$ 19,151
|
|
$ 71,088
|
|
$ 28,064
|
Per common share -
Diluted
|
$ (0.17 )
|
|
$ 0.24
|
|
$ 0.88
|
|
$ 0.35
|
|
|
|
|
|
|
|
|
Adjusted net income
(loss)
|
$ (9,679 )
|
|
$ 26,545
|
|
$ 88,007
|
|
$ 87,497
|
Per common share -
Diluted
|
$ (0.12 )
|
|
$ 0.33
|
|
$ 1.08
|
|
$ 1.08
|
Third Quarter Results
Total revenues were $212.1
million, an increase of $34.5
million, or 19.4%, from the previous year. The
increase was driven by higher maintenance revenues of $19.9 million and higher lease rental and finance
lease revenues of $9.6
million.
Lease rental and finance lease revenues during the third quarter
were $189.9 million versus
$180.3 million the prior year.
The 5.3% increase reflects net year over year growth in the fleet
and the impact from aircraft acquisitions, dispositions and lease
extensions.
Adjusted EBITDA for the third quarter was $216.3 million, up 21.9%, or $38.9 million, versus the prior year's quarter
and primarily reflects higher lease rental, finance lease and
maintenance revenues of $29.5
million, and higher gains from aircraft sales of
$4.3
million.
The net loss for the third quarter was $(14.0) million versus net income of $19.2 million the previous year. Higher
total revenues of $34.5 million were
offset by higher non-cash impairment charges of $58.0 million and higher depreciation charges of
$9.8 million associated with net
fleet growth and accelerated depreciation on three MD-11
freighters, two of which were sold during the third
quarter.
The adjusted net loss for the quarter was $(9.7) million versus adjusted net income
$26.5 million the prior year.
Higher revenues of $34.5 million and
higher gains from aircraft sales of $4.3
million were offset by higher non-cash aircraft impairment
charges of $58.0 million year over
year.
Aviation Assets
During the third quarter of 2015, we acquired seven aircraft for
$233 million. We closed or
committed to acquire five additional aircraft during the balance of
2015 for approximately $165
million. Year-to-date, we acquired or committed to
acquire a total of 37 aircraft that will close in 2015, for
approximately $1.2 billion. The
32 aircraft acquired during the first nine months of 2015 had a
weighted average age of less than four years, an average lease term
of more than nine years, and all but one were narrow-body
aircraft.
During the third quarter of 2015, we completed the sale of eight
aircraft, including two MD-11 freighter aircraft, one A330 and five
mid-aged narrow-body aircraft. The total pre-tax impact from
our third quarter sales activity was $15.7
million and gross proceeds were $111
million.
During the first three quarters of 2015, we sold twenty aircraft
that generated a total pre-tax impact of $38.3 million and gross proceeds of $341 million. The weighted-average age of
the aircraft sold was approximately 15 years.
During October, we completed several additional sales, including
one 747-400 converted freighter, one older A330 and our last
767. These sales have been profitable, in aggregate. In
addition, we concluded an agreement to sell our last remaining
MD-11 freighter in January 2016 for
an amount approximately equal to break-even.
2015 Aircraft
Sales through September 30
|
|
|
|
($ in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Aircraft
Type
|
Weighted Average
Age
(years)
|
Number of
Aircraft
|
Maintenance
Revenue
|
Gain (Loss) on
Sale of Flight Equipment
|
Impairments
|
Pre-Tax
Impact
|
Narrow-bodies
|
14.4
|
14
|
$ 7.0
|
$ 30.6
|
$ (5.3)
|
$ 32.3
|
Wide-bodies
|
15.8
|
4
|
-
|
12.8
|
-
|
12.8
|
Freighters
|
17.7
|
2
|
11.4
|
(0.4)
|
(17.9)
|
(6.8)
|
Total
|
14.9
|
20
|
$ 18.4
|
$ 43.0
|
$ (23.2)
|
$ 38.3
|
As of September 30, 2015,
Aircastle owned 160 aircraft having a net book value of
$6.0 billion. We also manage five
aircraft with a net book value of nearly $500 million dollars on behalf of our joint
venture with Ontario Teachers' Pension Plan.
|
|
|
Owned Aircraft as of September 30, 2015
|
|
Owned Aircraft as of September 30, 2014
|
Total Flight
Equipment Held for Lease ($ mils.)
|
|
|
|
|
$
|
6,007
|
|
|
$
|
5,304
|
|
Unencumbered Flight
Equipment Held for Lease ($ mils.)
|
|
|
|
|
$
|
3,722
|
|
|
$
|
2,924
|
|
Number of
Aircraft
|
|
|
|
160
|
|
|
140
|
|
Number of
Unencumbered Aircraft
|
|
|
|
109
|
|
|
85
|
|
Passenger Aircraft (%
of NBV)
|
|
|
|
88%
|
|
|
84%
|
|
Weighted Average
Fleet Age (years)(2)
|
|
|
|
7.7
|
|
|
8.6
|
|
Weighted Average
Remaining Lease Term
(years)(3)
|
|
|
|
5.9
|
|
|
5.0
|
|
Weighted Average
Fleet Utilization for the quarter
ended(4)
|
|
|
|
99.9%
|
|
|
100.0%
|
|
Portfolio Yield for
the quarter ended(5)
|
|
|
|
12.7%
|
|
|
13.2%
|
|
Net Cash Interest
Margin(6)
|
|
|
|
9.2%
|
|
|
9.9%
|
|
(1) Calculated using net book value of flight equipment held for
lease and net investment in finance leases at period end.
(2) Weighted average age by net book value.
(3) Weighted average remaining lease term by net book value.
(4) Aircraft on-lease days as a percent of total days in period
weighted by net book value.
(5) Lease rental revenue for the period as a percent of the average
net book value of flight equipment held for lease for the period;
quarterly information is annualized.
(6) Net Cash Interest Margin = Lease rental yield 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.
Annual Fleet Review & Impairments
During the third quarter of 2015, in connection with our annual
fleet review, we determined each of our six remaining Boeing
747-400 converted freighter aircraft are now on last leases.
We reduced our residual value assumptions for these aircraft and
expect to scrap them following lease expiry. This resulted in
an impairment of $34.6 million and
$1.9 million of additional
depreciation during Q3, partly offset by $6.0 million of maintenance and other
revenues. This determination reflects the persisting glut of
supply in the air cargo market. In addition, our older
freighters were affected specifically by the imposition of age
limits in certain countries and by lower utilization
levels.
In September 2015, Malaysian
Airline System ("MAS") informed us that they were rejecting the
lease on our Boeing 777-200ER aircraft as part of their
restructuring. Under the terms of our lease with MAS, we were
due to receive $18 million in rent
payments and another estimated $25
million in lease end return compensation. We
repossessed the aircraft in early October
2015 and are currently evaluating our deployment
alternatives. This aircraft, which was manufactured in 1998,
is the only one of its type in our fleet and is the only aircraft
we had on lease to MAS.
We reduced the carrying value of this 777-200ER aircraft to an
amount equal to our best estimate of scrap value. While we
haven't made a decision to dispose of the aircraft, this write-down
was driven by weak overall demand for older wide-body aircraft, an
increase in the supply of competing aircraft and the difficulty of
recovering high redeployment costs given the proliferation of
aircraft age limits across the world. This write-down
resulted in an impairment of $37.8
million, partly offset by a $1.2
million letter of credit we drew following the lease
rejection. We will pursue remedies to recover amounts due to
us.
Breakdown of Third Quarter Results
($ in millions
except per
share
amounts)
|
Q3:15
Results
|
747
Freighters
|
MAS
Bankruptcy
|
Adjusted Q3:15
Results
|
Revenues
|
|
|
|
|
Lease
Rentals
|
$ 188.0
|
$
0.2
|
$
|
$ 187.9
|
Maintenance /
Other Revenues
|
24.0
|
5.9
|
1.2
|
17.0
|
Total
Revenues
|
212.1
|
6.0
|
1.2
|
204.8
|
|
|
|
|
|
Operating
Expenses
|
|
|
|
|
Depreciation
|
85.3
|
1.9
|
|
83.4
|
Aircraft
Impairment Charges
|
78.4
|
34.6
|
37.8
|
6.1
|
All Other
Expenses
|
76.9
|
|
|
76.9
|
Total Operating
Expenses
|
240.7
|
36.5
|
37.8
|
166.4
|
|
|
|
|
|
Other Income
(Expense)
|
|
|
|
|
Gain on Sale
of Flight Equipment
|
15.7
|
|
|
15.7
|
All Other
Income (Expense)
|
0.1
|
|
|
0.1
|
Total Other Income
(Expense)
|
15.8
|
|
|
15.8
|
|
|
|
|
|
Pre-Tax
Income
|
(12.8)
|
(30.4)
|
(36.6)
|
54.2
|
Income
Taxes
|
(2.7)
|
1.0
|
|
(3.7)
|
Joint Venture
Income
|
1.6
|
|
|
1.6
|
|
|
|
|
|
Net Income
(Loss)
|
$ (14.0)
|
$ (29.4)
|
$ (36.6)
|
$ 52.0
|
|
|
|
|
|
Per Share
|
$ (0.17)
|
$ (0.36)
|
$ (0.45)
|
$ 0.64
|
|
|
|
|
|
ANI Per
Share
|
$ (0.12)
|
$ (0.36)
|
$ (0.45)
|
$ 0.69
|
Common Dividend
On October 30, 2015, Aircastle's
Board of Directors declared a fourth quarter 2015 cash dividend on
its common shares of $0.24 per share,
payable on December 15, 2015 to
shareholders of record on November
30, 2015. This is our 38th consecutive
dividend and represents a 9% increase over the previous quarter's
cash dividend. Since 2010, Aircastle has increased the
dividend six times.
Conference Call
In connection with this earnings release, management will host
an earnings conference call on Tuesday,
November 3, 2015 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 (888) 417-8533 (from within the U.S. and
Canada) or (719) 325-2354 (from
outside of the U.S. and Canada)
ten minutes prior to the scheduled start and referencing the
passcode "9463401".
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, December 3,
2015 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
"9463401".
About Aircastle Limited
Aircastle Limited acquires, leases and sells commercial jet
aircraft to airlines throughout the world. As of September 30, 2015, Aircastle's aircraft
portfolio consisted of 160 aircraft on lease with 51 customers
located in 32 countries.
Safe Harbor
All statements included or incorporated by reference in this
Press Release (this "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 ability to acquire, sell, lease or finance
aircraft, raise capital, pay dividends, and increase revenues,
earnings, EBITDA, Adjusted EBITDA and Adjusted Net Income 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 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 1 A of Aircastle's 2014 Annual Report on
Form 10-K and our Form 10-Q filed for the quarter ended
June 30, 2015, and elsewhere in this
Release. 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
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)
|
|
|
|
|
|
September 30,
2015
|
|
December 31,
2014
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
Cash and cash
equivalents
|
$
|
149,041
|
|
|
$
|
169,656
|
|
Accounts
receivable
|
3,046
|
|
|
3,334
|
|
Restricted cash and
cash equivalents
|
84,258
|
|
|
98,884
|
|
Restricted liquidity
facility collateral
|
65,000
|
|
|
65,000
|
|
Flight equipment held
for lease, net of accumulated depreciation of $1,403,443 and
$1,294,063, respectively
|
5,885,807
|
|
|
5,579,718
|
|
Net investment in
finance leases
|
120,882
|
|
|
106,651
|
|
Unconsolidated equity
method investment
|
49,131
|
|
|
46,453
|
|
Other
assets
|
131,231
|
|
|
105,450
|
|
Total
assets
|
$
|
6,488,396
|
|
|
$
|
6,175,146
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
LIABILITIES
|
|
|
|
Borrowings from
secured financings, net of debt issuance costs
|
$
|
1,277,361
|
|
|
$
|
1,373,131
|
|
Borrowings from
unsecured financings, net of debt issuance costs
|
2,717,859
|
|
|
2,371,456
|
|
Accounts payable,
accrued expenses and other liabilities
|
154,209
|
|
|
140,863
|
|
Lease rentals
received in advance
|
60,447
|
|
|
53,216
|
|
Liquidity
facility
|
65,000
|
|
|
65,000
|
|
Security
deposits
|
114,594
|
|
|
117,689
|
|
Maintenance
payments
|
338,515
|
|
|
333,456
|
|
Total
liabilities
|
4,727,985
|
|
|
4,454,811
|
|
|
|
|
|
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, 81,181,495
shares issued and outstanding at September 30, 2015; and 80,983,249
shares issued and outstanding at December 31, 2014
|
812
|
|
|
810
|
|
Additional paid-in
capital
|
1,567,692
|
|
|
1,565,180
|
|
Retained
earnings
|
210,310
|
|
|
192,805
|
|
Accumulated other
comprehensive loss
|
(18,403)
|
|
|
(38,460)
|
|
Total shareholders'
equity
|
1,760,411
|
|
|
1,720,335
|
|
Total liabilities and
shareholders' equity
|
$
|
6,488,396
|
|
|
$
|
6,175,146
|
|
Aircastle Limited
and Subsidiaries
|
Consolidated
Statements of Income
|
(Dollars in
thousands, except per share amounts)
|
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Revenues:
|
|
|
|
|
|
|
|
Lease rental
revenue
|
$
|
188,038
|
|
|
$
|
178,886
|
|
|
$
|
550,023
|
|
|
$
|
536,452
|
|
Finance lease
revenue
|
1,868
|
|
|
1,463
|
|
|
5,352
|
|
|
9,347
|
|
Amortization of lease
premiums, discounts and lease incentives
|
(2,113)
|
|
|
(1,075)
|
|
|
(10,288)
|
|
|
(7,252)
|
|
Maintenance
revenue
|
15,726
|
|
|
(4,189)
|
|
|
55,148
|
|
|
35,035
|
|
Total lease
revenue
|
203,519
|
|
|
175,085
|
|
|
600,235
|
|
|
573,582
|
|
Other
revenue
|
8,555
|
|
|
2,511
|
|
|
10,700
|
|
|
6,763
|
|
Total
revenues
|
212,074
|
|
|
177,596
|
|
|
610,935
|
|
|
580,345
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Depreciation
|
85,324
|
|
|
75,519
|
|
|
237,538
|
|
|
225,230
|
|
Interest,
net
|
60,381
|
|
|
56,794
|
|
|
184,063
|
|
|
181,551
|
|
Selling, general and
administrative (including non-cash share based payment expense of
$1,424 and $949 for the three months ended and $3,981 and $3,167
for the nine months ended September 30, 2015 and 2014,
respectively)
|
14,032
|
|
|
13,817
|
|
|
42,663
|
|
|
41,818
|
|
Impairment of
Aircraft
|
78,403
|
|
|
20,436
|
|
|
102,358
|
|
|
67,005
|
|
Maintenance and other
costs
|
2,520
|
|
|
713
|
|
|
9,126
|
|
|
5,222
|
|
Total
expenses
|
240,660
|
|
|
167,279
|
|
|
575,748
|
|
|
520,826
|
|
|
|
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
Gain on sale of
flight equipment
|
15,679
|
|
|
11,390
|
|
|
43,034
|
|
|
13,384
|
|
Loss on
extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
(36,570)
|
|
Other
|
70
|
|
|
1
|
|
|
341
|
|
|
758
|
|
Total other income
(expense)
|
15,749
|
|
|
11,391
|
|
|
43,375
|
|
|
(22,428)
|
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations before income taxes
|
(12,837)
|
|
|
21,708
|
|
|
78,562
|
|
|
37,091
|
|
Income tax
provision
|
2,709
|
|
|
3,484
|
|
|
12,037
|
|
|
10,925
|
|
Earnings of
unconsolidated equity method investment, net of tax
|
1,557
|
|
|
927
|
|
|
4,563
|
|
|
1,898
|
|
Net income
(loss)
|
$
|
(13,989)
|
|
|
$
|
19,151
|
|
|
$
|
71,088
|
|
|
$
|
28,064
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per
common share — Basic:
|
|
|
|
|
|
|
|
Net income (loss) per
share
|
$
|
(0.17)
|
|
|
$
|
0.24
|
|
|
$
|
0.88
|
|
|
$
|
0.35
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per
common share — Diluted:
|
|
|
|
|
|
|
|
Net income (loss) per
share
|
$
|
(0.17)
|
|
|
$
|
0.24
|
|
|
$
|
0.88
|
|
|
$
|
0.35
|
|
|
|
|
|
|
|
|
|
Dividends declared
per share
|
$
|
0.22
|
|
|
$
|
0.20
|
|
|
$
|
0.66
|
|
|
$
|
0.60
|
|
Aircastle Limited
and Subsidiaries
|
Consolidated
Statements of Cash Flows
|
(Dollars in
thousands)
|
(Unaudited)
|
|
|
|
Nine Months Ended
September 30,
|
|
2015
|
|
2014
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
|
71,088
|
|
|
$
|
28,064
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
Depreciation
|
237,538
|
|
|
225,230
|
|
Amortization of
deferred financing costs
|
11,211
|
|
|
10,493
|
|
Amortization of net
lease discounts and lease incentives
|
10,288
|
|
|
7,252
|
|
Deferred income
taxes
|
(1,455)
|
|
|
(2,623)
|
|
Non-cash share based
payment expense
|
3,981
|
|
|
3,167
|
|
Cash flow hedges
reclassified into earnings
|
19,349
|
|
|
26,730
|
|
Security deposits and
maintenance payments included in earnings
|
(20,645)
|
|
|
(38,257)
|
|
Gain on sale of
flight equipment
|
(43,034)
|
|
|
(13,384)
|
|
Loss on
extinguishment of debt
|
—
|
|
|
36,570
|
|
Impairment of
aircraft
|
102,358
|
|
|
67,005
|
|
Other
|
269
|
|
|
(2,278)
|
|
Changes in certain
assets and liabilities:
|
|
|
|
Accounts
receivable
|
253
|
|
|
(1,603)
|
|
Other
assets
|
(4,382)
|
|
|
(1,691)
|
|
Accounts payable,
accrued expenses and other liabilities
|
14,085
|
|
|
17,138
|
|
Lease rentals
received in advance
|
7,566
|
|
|
4,162
|
|
Net cash provided by
operating activities
|
408,470
|
|
|
365,975
|
|
Cash flows from
investing activities:
|
|
|
|
Acquisition and
improvement of flight equipment and lease incentives
|
(1,034,578)
|
|
|
(939,651)
|
|
Proceeds from sale of
flight equipment
|
343,020
|
|
|
563,882
|
|
Restricted cash and
cash equivalents related to sale of flight equipment
|
—
|
|
|
(24,606)
|
|
Aircraft purchase
deposits and progress payments
|
(4,421)
|
|
|
1,315
|
|
Net investment in
finance leases
|
(24,000)
|
|
|
(14,258)
|
|
Collections on
finance leases
|
6,768
|
|
|
8,096
|
|
Unconsolidated equity
method investment and associated costs
|
—
|
|
|
(8,592)
|
|
Distributions from
unconsolidated equity method investment in excess of
earnings
|
—
|
|
|
997
|
|
Other
|
(260)
|
|
|
(466)
|
|
Net cash used in
investing activities
|
(713,471)
|
|
|
(413,283)
|
|
Cash flows from
financing activities:
|
|
|
|
Issuance of shares
net of repurchases
|
(1,960)
|
|
|
(2,092)
|
|
Proceeds from secured
and unsecured debt financings
|
800,000
|
|
|
803,200
|
|
Repayments of secured
and unsecured debt financings
|
(548,359)
|
|
|
(895,459)
|
|
Debt extinguishment
costs
|
—
|
|
|
(32,835)
|
|
Deferred financing
costs
|
(12,185)
|
|
|
(15,843)
|
|
Restricted liquidity
facility collateral
|
—
|
|
|
42,000
|
|
Liquidity
facility
|
—
|
|
|
(42,000)
|
|
Restricted cash and
cash equivalents related to financing activities
|
14,626
|
|
|
32,987
|
|
Security deposits and
maintenance payments received
|
114,644
|
|
|
131,136
|
|
Security deposits and
maintenance payments returned
|
(28,797)
|
|
|
(72,030)
|
|
Payments for
terminated cash flow hedges
|
—
|
|
|
(33,427)
|
|
Dividends
paid
|
(53,583)
|
|
|
(48,604)
|
|
Net cash provided by
(used in) financing activities
|
284,386
|
|
|
(132,967)
|
|
Net increase
(decrease) in cash and cash equivalents
|
(20,615)
|
|
|
(180,275)
|
|
Cash and cash
equivalents at beginning of period
|
169,656
|
|
|
654,613
|
|
Cash and cash
equivalents at end of period
|
$
|
149,041
|
|
|
$
|
474,338
|
|
Aircastle Limited and
Subsidiaries
|
Selected Financial
Guidance Elements for the Fourth Quarter of 2015
|
($ in millions,
except for percentages)
|
(Unaudited)
|
|
|
Guidance
Item
|
Q4:15(1)
|
Lease rental
revenue
|
$178 -
$182
|
Finance lease
revenue
|
$1 - $2
|
Maintenance
revenue
|
$6 - $8
|
Amortization of net
lease discounts and lease incentives
|
$(5) –
$(6)
|
SG&A
|
$14 - $15
|
Depreciation
|
$79 - $81
|
Interest, net
(2)
|
$59 - $60
|
Gain on
sale
|
$5 - $10
|
Full year effective
tax rate
|
13% - 14%
|
(1) Excludes the impact of lease end part
outs.
(2) Includes non-cash hedge loss amortization
charges related to the payoff of Securitization No.1 of
$2.7 million.
Aircastle Limited and
Subsidiaries
|
Supplemental
Financial Information
|
(Amount in thousands,
except per share amounts)
|
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
Sept.
30,
|
|
Nine Months
Ended
Sept.
30,
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
Revenues
|
$ 212,074
|
|
$ 177,596
|
|
$ 610,935
|
|
$ 580,345
|
|
|
|
|
|
|
|
|
EBITDA
|
$ 136,538
|
|
$ 156,023
|
|
$ 515,014
|
|
$ 453,022
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA
|
$ 216,311
|
|
$ 177,408
|
|
$ 621,133
|
|
$ 559,083
|
|
|
|
|
|
|
|
|
Adjusted net income
(loss)
|
$ (9,679)
|
|
$ 26,545
|
|
$ 88,007
|
|
$ 87,497
|
|
|
|
|
|
|
|
|
Adjusted net income
(loss) allocable to common shares
|
$ (9,679)
|
|
$ 26,348
|
|
$ 87,352
|
|
$ 86,868
|
Per common share -
Basic
|
$ (0.12)
|
|
$ 0.33
|
|
$ 1.08
|
|
$ 1.08
|
Per common share -
Diluted
|
$ (0.12)
|
|
$ 0.33
|
|
$ 1.08
|
|
$ 1.08
|
|
|
|
|
|
|
|
|
Basic common shares
outstanding
|
80,566
|
|
80,390
|
|
80,566
|
|
80,389
|
Diluted common shares
outstanding
|
80,566
|
|
80,390
|
|
80,566
|
|
80,389
|
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
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
(Dollars in
thousands)
|
Net income
(loss)
|
$
|
(13,989)
|
|
|
$
|
19,151
|
|
|
$
|
71,088
|
|
|
$
|
28,064
|
|
Depreciation
|
85,324
|
|
|
75,519
|
|
|
237,538
|
|
|
225,230
|
|
Amortization of net
lease discounts and lease incentives
|
2,113
|
|
|
1,075
|
|
|
10,288
|
|
|
7,252
|
|
Interest,
net
|
60,381
|
|
|
56,794
|
|
|
184,063
|
|
|
181,551
|
|
Income tax
provision
|
2,709
|
|
|
3,484
|
|
|
12,037
|
|
|
10,925
|
|
EBITDA
|
136,538
|
|
|
156,023
|
|
|
515,014
|
|
|
453,022
|
|
Adjustments:
|
|
|
|
|
|
|
|
Impairment of
aircraft
|
78,403
|
|
|
20,436
|
|
|
102,358
|
|
|
67,005
|
|
Loss on
extinguishment of debt
|
—
|
|
|
—
|
|
|
—
|
|
|
36,570
|
|
Non-cash share
based payment expense
|
1,424
|
|
|
949
|
|
|
3,981
|
|
|
3,167
|
|
Gain on mark
to market of interest rate derivative contracts
|
(54)
|
|
|
—
|
|
|
(220)
|
|
|
(681)
|
|
Adjusted EBITDA
|
$
|
216,311
|
|
|
$
|
177,408
|
|
|
$
|
621,133
|
|
|
$
|
559,083
|
|
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
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
(Dollars in
thousands)
|
Net income
(loss)
|
$
|
(13,989)
|
|
|
$
|
19,151
|
|
|
$
|
71,088
|
|
|
$
|
28,064
|
|
Loss on extinguishment
of debt(2)
|
—
|
|
|
—
|
|
|
—
|
|
|
36,570
|
|
Ineffective portion
and termination of hedges(1)
|
215
|
|
|
(21)
|
|
|
509
|
|
|
41
|
|
Gain on mark to market
of interest rate derivative contracts(2)
|
(54)
|
|
|
—
|
|
|
(220)
|
|
|
(681)
|
|
Non-cash share based payment expense(3)
|
1,424
|
|
|
949
|
|
|
3,981
|
|
|
3,167
|
|
Term
Financing No. 1 hedge loss amortization
charges(1)
|
—
|
|
|
3,601
|
|
|
4,401
|
|
|
11,544
|
|
Securitization No. 1 hedge loss amortization
charges (1)
|
2,725
|
|
|
2,865
|
|
|
8,248
|
|
|
8,792
|
|
Adjusted net income
(loss)
|
$
|
(9,679)
|
|
|
$
|
26,545
|
|
|
$
|
88,007
|
|
|
$
|
87,497
|
|
(1) Included in Interest, net.
(2) Included in Other income (expense).
(3) Included in Selling, general and
administrative expenses.
Aircastle Limited
and Subsidiaries
|
Reconciliation of
GAAP to Non-GAAP Measures
|
Cash Return on
Equity Calculation
|
(Dollars in
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Cash Flow from
Operations
|
Collections on
Finance Leases
|
Gain (Loss) on Sale
of Eqt.
|
Depreciation
|
Distributions from
JV
|
Cash
Earnings
|
Average Shareholders'
Equity
|
12 Month Cash
ROE
|
2008
|
$333,626
|
|
$6,525
|
$201,759
|
|
$138,392
|
$1,242,635
|
11.1%
|
2009
|
$327,641
|
|
$1,162
|
$209,481
|
|
$119,322
|
$1,205,284
|
9.9%
|
2010
|
$356,530
|
|
$7,084
|
$220,476
|
|
$143,138
|
$1,300,953
|
11.0%
|
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%
|
LTM
|
$501,281
|
$8,984
|
$52,796
|
$311,673
|
($14)
|
$251,374
|
$1,735,012
|
14.5%
|
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 of
Flight Equipment
|
|
Quarterly Lease
Rental Revenue
|
|
Cash
Interest1
|
|
Annualized Net
Cash Interest Margin
|
Q1:11
|
|
$
4,041,967
|
|
$
141,116
|
|
$
41,278
|
|
9.9%
|
Q2:11
|
|
$
4,143,446
|
|
$
143,356
|
|
$
43,217
|
|
9.7%
|
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
|
|
$
4,516,973
|
|
$
153,624
|
|
$
48,798
|
|
9.3%
|
Q3:12
|
|
$
4,602,185
|
|
$
159,546
|
|
$
41,373
|
|
10.3%
|
Q4:12
|
|
$
4,605,783
|
|
$
158,090
|
|
$
43,461
|
|
10.0%
|
Q1:13
|
|
$
4,619,204
|
|
$
156,590
|
|
$
48,591
|
|
9.4%
|
Q2:13
|
|
$
4,711,790
|
|
$
157,918
|
|
$
47,869
|
|
9.3%
|
Q3:13
|
|
$
4,717,877
|
|
$
161,148
|
|
$
47,682
|
|
9.6%
|
Q4:13
|
|
$
4,972,040
|
|
$
169,274
|
|
$
49,080
|
|
9.7%
|
Q1:14
|
|
$
5,168,851
|
|
$
174,335
|
|
$
51,685
|
|
9.5%
|
Q2:14
|
|
$
5,582,359
|
|
$
183,231
|
|
$
48,172
|
|
9.7%
|
Q3:14
|
|
$
5,412,299
|
|
$
178,886
|
|
$
44,820
|
|
9.9%
|
Q4:14
|
|
$
5,373,733
|
|
$
178,202
|
|
$
44,459
|
|
10.0%
|
Q1:15
|
|
$
5,637,513
|
|
$
177,146
|
|
$
50,235
|
|
9.0%
|
Q2:15
|
|
$
5,850,516
|
|
$
184,839
|
|
$
51,413
|
|
9.1%
|
Q3:15
|
|
$
5,926,459
|
|
$
188,038
|
|
$
51,428
|
|
9.2%
|
(1) Excludes loan termination payments of $3.2 million and $3.0
million in the second quarter of 2011 and 2013
respectively.
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
September 30,
2015
|
|
Nine Months
Ended
September 30,
2015
|
|
Weighted-average
shares(1):
|
Shares
|
|
Percent(2)
|
|
Shares
|
|
Percent(2)
|
|
Common shares
outstanding – Basic
|
80,566
|
|
|
99.21%
|
|
|
80,566
|
|
|
99.26%
|
|
Unvested restricted
common shares
|
645
|
|
|
0.79%
|
|
|
604
|
|
|
0.74%
|
|
Total
weighted-average shares outstanding
|
81,212
|
|
|
100.00%
|
|
|
81,170
|
|
|
100.00%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
allocation
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
$(13,989)
|
|
|
100.00%
|
|
|
$71,088
|
|
|
100.00%
|
|
Distributed and
undistributed earnings allocated to unvested restricted
shares
|
--
|
|
|
--
|
|
|
(529)
|
|
|
(0.74%)
|
|
Earnings (loss)
available to common shares
|
$(13,989)
|
|
|
100.00%
|
|
|
$70,559
|
|
|
99.26%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net
income (loss) allocation
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income
(loss)
|
$(9,679)
|
|
|
100.00%
|
|
|
$88,007
|
|
|
100.00%
|
|
Amounts allocated to
unvested restricted shares
|
--
|
|
|
--
|
|
|
(655)
|
|
|
(0.74%)
|
|
Amounts allocated to
common shares
|
$(9,679)
|
|
|
100.00%
|
|
|
$87,352
|
|
|
99.26%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) For the three and nine months ended
September 30, 2015 the company had no
dilutive shares.
(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
September 30,
2014
|
|
Nine Months
Ended
September 30,
2014
|
|
Weighted-average
shares(1):
|
Shares
|
|
Percent(2)
|
|
Shares
|
|
Percent(2)
|
|
Common shares
outstanding – Basic
|
80,390
|
|
|
99.26%
|
|
|
80,389
|
|
|
99.28%
|
|
Unvested restricted
common shares
|
601
|
|
|
0.74%
|
|
|
582
|
|
|
0.72%
|
|
Total
weighted-average shares outstanding
|
80,991
|
|
|
100.00%
|
|
|
80,971
|
|
|
100.00%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
allocation
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$19,151
|
|
|
100.00%
|
|
|
$28,064
|
|
|
100.00%
|
|
Distributed and
undistributed earnings allocated to unvested restricted
shares
|
(142)
|
|
|
(0.74%)
|
|
|
(202)
|
|
|
(0.72%)
|
|
Earnings available to
common shares
|
$19,009
|
|
|
99.26%
|
|
|
$27,862
|
|
|
99.28%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net
income allocation
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net
income
|
$26,545
|
|
|
100.00%
|
|
|
$87,497
|
|
|
100.00%
|
|
Amounts allocated to
unvested restricted shares
|
(197)
|
|
|
(0.74%)
|
|
|
(629)
|
|
|
(0.72%)
|
|
Amounts allocated to
common shares
|
$26,348
|
|
|
99.26%
|
|
|
$86,868
|
|
|
99.28%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) For the three and nine months ended
September 30, 2014 the company had no
dilutive shares.
(2) 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:
+1-212-377-8483
|
fconstantinople@aircastle.com
|
lberman@igbir.com
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/aircastle-announces-third-quarter-2015-results-300170970.html
SOURCE Aircastle Limited