DUBLIN, March 11, 2015 /PRNewswire/ -- FLY Leasing
Limited (NYSE: FLY), a global leader in aircraft leasing, today
announced its financial results for the fourth quarter and full
year of 2014.
Fourth Quarter 2014 Highlights
- Net income of $15.5 million,
$0.37 per share
- Total revenues of $120.3 million,
40% up on Q4 2013
- Acquired six aircraft for $275.7
million, increasing portfolio to 127 aircraft
- Raised $400 million in unsecured
debt to finance aircraft acquisitions
- Declared 29th consecutive quarterly dividend
2014 Full Year Highlights
- Net income of $56.1 million,
$1.32 per share
- Total revenues of $426.7 million,
15% up on prior year
- Grew portfolio value by 22% to $3.7
billion
- Invested $951.5 million in 22
aircraft
- Sold eight aircraft for a net gain of $18.9 million
- Unrestricted cash of $337.6
million at year end
- Paid four quarterly dividends totaling $1.00 per share
"FLY is reporting strong fourth quarter and full year results,"
said Colm Barrington, FLY's CEO.
"Our fourth quarter and full year revenues are up 40% and 15%,
respectively, driven by the successful rejuvenation of our fleet
through the acquisition of newer aircraft and the sale of older
models. This strategy has lowered the average age of our fleet to
7.8 years and increased our average lease term to over five years.
We grew our book value per share to $18.32."
"This is the second successive year in which we have grown our
fleet substantially," added Barrington. "In 2014, we bought 22
aircraft, mainly through sale and leaseback transactions with
airlines, increasing our fleet value by 22% to more than
$3.7 billion. In addition, we have
continued to monetize older aircraft at premiums to book value,
demonstrating the strong inherent value in our fleet. And we have
continued to pay attractive quarterly dividends of 25 cents per share."
"The global airline industry is in a healthy state, spurred by
increasing passenger traffic and lower fuel prices. Airline profits
reached record levels in 2014, with further improvements forecast
for 2015. This industry health has stimulated demand from our
airline customers to grow their fleets, and with aircraft
manufacturers sold out for many years ahead, leasing is a key
source of additional capacity. With ample capital and a nimble
strategy that allows us to act quickly to take advantage of
opportunities in the market, FLY is in an excellent position to
continue its growth and deliver value to its shareholders," said
Barrington.
Financial Results
FLY is reporting Net income of $15.5
million or $0.37 per diluted
share for the fourth quarter of 2014. This compares to Net income
of $13.4 million or $0.32 per diluted share for the same period of
2013. The fourth quarter 2014 results include $21.7 million of end of lease income compared to
the fourth quarter of 2013 in which there was none. However, the
fourth quarter 2013 results included $18.6
million in net gains associated with refinancing
transactions.
Total revenues for the fourth quarter of 2014 were $120.3 million, compared to $85.5 million for the same period in the previous
year, an increase of 40.7%.
Net income for the year ended December
31, 2014 was $56.1 million or
$1.32 per diluted share compared to
$52.5 million or $1.50 per diluted share for 2013. For 2014, end
of lease income was $39.8 million and
gains on aircraft sales totaled $18.9
million. The 2013 results included $47.6 million in end of lease income and
$6.3 million in gains on aircraft
sales.
Total revenues for 2014 were $426.7
million, compared to $369.5
million in 2013, an increase of 15.5%.
Adjusted Net Income
Adjusted Net Income was $16.9
million for the fourth quarter of 2014 compared to
$4.9 million in the same period in
the previous year. On a per share basis, Adjusted Net Income was
$0.41 in the fourth quarter of 2014
compared to $0.12 in the fourth
quarter of 2013.
For each of the years ended December 31,
2014 and 2013, Adjusted Net Income was $57.4 million. On a per share basis,
Adjusted Net Income was $1.38 in 2014
and $1.68 in 2013.
A reconciliation of Adjusted Net Income to net income determined
in accordance with GAAP is shown below.
Dividend
On February 20, 2015, FLY paid a
dividend of $0.25 per share in
respect of the fourth quarter of 2014 to shareholders of record on
January 30, 2015. This dividend is
FLY's 29th consecutive quarterly dividend and brought
the total dividend in respect of 2014 to $1.00 per share. Dividends paid since FLY was
listed in September 2007 total
$7.37 per share.
Financial Position
At December 31, 2014, FLY's total
assets were $4.2 billion, including
flight equipment with a net book value of $3.7 billion. Total cash at December 31, 2014 was $476.7 million, of which $337.6 million was unrestricted.
Aircraft Portfolio
At December 31, 2014, FLY's 127
aircraft, shown in the table below, were on lease to 64 lessees in
36 countries.
|
|
|
|
Portfolio(1) at
|
Dec. 31,
2014
|
Dec 31,
2013
|
|
Airbus
A319
|
18
|
19
|
|
Airbus
A320
|
27
|
27
|
|
Airbus
A321
|
3
|
-
|
|
Airbus
A330
|
4
|
1
|
|
Airbus
A340
|
3
|
3
|
|
Boeing 737
|
57
|
48
|
|
Boeing 747
|
1
|
1
|
|
Boeing 757
|
11
|
11
|
|
Boeing 767
|
1
|
1
|
|
Boeing 777
|
1
|
1
|
|
Boeing 787
|
1
|
1
|
|
Total
|
127
|
113
|
|
|
(1) The
table does not include the four B767 aircraft owned by a joint
venture in which FLY has a 57% interest
|
At December 31, 2014, the average
age of FLY's fleet, weighted by the net book value of each
aircraft, was 7.8 years compared to 8.6 years at December 31, 2013. The average remaining lease
term, also weighted by net book value, was 5.3 years as of
December 31, 2014, an increase of
approximately 12 months from the prior year. At December 31, 2014, FLY's leases were generating
annualized revenues of approximately $420
million. FLY's lease utilization factor was 99% for the
fourth quarter of 2014 and for the year ended December 31, 2014. At December 31, 2014, there were three aircraft
off-lease.
Conference Call and Webcast
FLY's senior management will host a conference call and webcast
to discuss these results at 9:00 a.m.
U.S. Eastern Time on Wednesday, March
11, 2015. Participants should call +1-253-237-1145
(International) or 800-535-7056 (North
America) and enter confirmation code 67575239 or ask an
operator for the FLY Leasing earnings call. A replay will be
available shortly after the call. To access the replay, please dial
+1-404-537-3406 (International) or 855-859-2056 (North America) and enter confirmation code
67575239. The telephone replay will be available for one
week. A live webcast of the conference call will be also
available in the investor section of FLY's website at
www.flyleasing.com. An archived webcast will be available for one
year.
About FLY
FLY is a global aircraft leasing company with a fleet of modern,
high-demand and fuel-efficient commercial jet aircraft. FLY
acquires and leases its aircraft under multi-year operating lease
contracts to a diverse group of airlines throughout the world. FLY
is managed and serviced by BBAM LP, a worldwide leader in aircraft
lease management and financing. For more information about FLY,
please visit our website at www.flyleasing.com.
Cautionary Statement Regarding Forward-Looking
Statements
This press release contains certain "forward - looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements may be identified by
words such as "expects," "intends," "anticipates," "plans,"
"believes," "seeks," "estimates," "will," or words of similar
meaning and include, but are not limited to, statements regarding
the outlook for FLY's future business and financial performance.
Forward-looking statements are based on management's current
expectations and assumptions, which are subject to inherent
uncertainties, risks and changes in circumstances that are
difficult to predict. Actual outcomes and results may differ
materially due to global political, economic, business,
competitive, market, regulatory and other factors and risks.
Further information on the factors and risks that may affect FLY's
business is included in filings FLY makes with the Securities and
Exchange Commission from time to time, including its Annual Report
on Form 20-F and its reports on Form 6-K. FLY expressly
disclaims any obligation to update or revise any of these
forward-looking statements, whether because of future events, new
information, a change in its views or expectations, or
otherwise.
Contact:
Matt Dallas
FLY Leasing Limited
+1 203-769-5916
ir@flyleasing.com
|
|
|
FLY Leasing
Limited
|
|
Consolidated
Statements of Income
|
|
(DOLLARS IN
THOUSANDS, EXCEPT PER SHARE DATA)
|
|
|
Three months
ended
Dec. 31, 2014
(Unaudited)
|
Three months
ended
Dec. 31, 2013
(Unaudited)
|
Year
ended
Dec.
31, 2014
(Audited)
|
Year
ended
Dec. 31,
2013
(Audited)
|
|
Revenues
|
|
|
|
|
|
Operating
lease revenue
|
$ 119,993
|
$ 84,826
|
$ 404,668
|
$ 359,409
|
|
Equity
earnings from unconsolidated subsidiary
|
351
|
494
|
2,456
|
1,871
|
|
Gain on
sale of aircraft
|
—
|
—
|
18,878
|
6,277
|
|
Interest
and other income
|
(56)
|
149
|
662
|
1,930
|
|
Total
revenues
|
120,288
|
85,469
|
426,664
|
369,487
|
|
Expenses
|
|
|
|
|
|
Depreciation
|
49,059
|
39,749
|
175,547
|
146,400
|
|
Aircraft
impairment
|
—
|
8,825
|
—
|
8,825
|
|
Interest
expense
|
40,392
|
30,198
|
142,519
|
120,399
|
|
Net
(gain) loss on extinguishment of debt
|
88
|
(18,585)
|
(3,922)
|
(15,881)
|
|
Selling,
general and administrative
|
10,313
|
10,055
|
41,148
|
37,418
|
|
Ineffective, dedesignated and terminated derivatives
|
189
|
(243)
|
72
|
(1,263)
|
|
Maintenance and other costs
|
2,286
|
2,967
|
6,960
|
15,454
|
|
Total
expenses
|
102,327
|
72,966
|
362,324
|
311,352
|
|
Net income before
provision for income taxes
|
17,961
|
12,503
|
64,340
|
58,135
|
|
Provision (benefit) for income taxes
|
2,482
|
(909)
|
8,263
|
5,659
|
|
Net
income
|
$ 15,479
|
$ 13,412
|
$ 56,077
|
$ 52,476
|
|
Weighted average
number of shares
|
|
|
|
|
|
-
Basic
|
41,432,998
|
41,306,338
|
41,405,211
|
34,129,880
|
|
-
Diluted
|
41,479,349
|
41,431,486
|
41,527,584
|
34,243,456
|
|
Earnings per
share
|
|
|
|
|
|
-
Basic
|
$ 0.37
|
$ 0.32
|
$ 1.32
|
$ 1.51
|
|
-
Diluted
|
$ 0.37
|
$ 0.32
|
$ 1.32
|
$ 1.50
|
|
Dividends declared
and paid per share
|
$ 0.25
|
$ 0.22
|
$ 1.00
|
$ 0.88
|
|
|
|
FLY Leasing
Limited
|
|
Consolidated
Balance Sheets
|
|
(DOLLARS IN
THOUSANDS, EXCEPT PER SHARE DATA)
|
|
|
Dec.
31,
2014
(Audited)
|
Dec. 31,
2013
(Audited)
|
|
Assets
|
|
|
|
Cash and
cash equivalents
|
$ 337,560
|
$ 404,472
|
|
Restricted cash and cash equivalents
|
139,139
|
174,829
|
|
Rent
receivables
|
4,887
|
2,922
|
|
Investment in unconsolidated subsidiary
|
4,002
|
8,179
|
|
Flight
equipment held for operating lease, net
|
3,705,407
|
3,034,912
|
|
Fair
market value of derivative assets
|
2,067
|
7,395
|
|
Other
assets, net
|
31,608
|
39,650
|
|
Total
assets
|
$ 4,224,670
|
$ 3,672,359
|
|
Liabilities
|
|
|
|
Accounts
payable and accrued liabilities
|
$ 18,431
|
$ 16,592
|
|
Rentals
received in advance
|
19,751
|
17,422
|
|
Payable
to related parties
|
2,772
|
3,756
|
|
Security
deposits
|
64,058
|
52,837
|
|
Maintenance payment liability
|
254,514
|
233,811
|
|
Unsecured borrowings, net
|
689,452
|
291,567
|
|
Secured
borrowings, net
|
2,335,328
|
2,254,705
|
|
Fair
market value of derivative liabilities
|
23,311
|
24,577
|
|
Deferred
tax liability, net
|
16,289
|
7,746
|
|
Other
liabilities
|
41,890
|
20,523
|
|
Total
liabilities
|
3,465,796
|
2,923,536
|
|
Shareholders'
equity
|
|
|
|
Common
shares, $0.001 par value, 499,999,900 shares authorized; 41,432,998
and
41,306,338 shares
issued and outstanding at December 31, 2014 and 2013,
respectively
|
41
|
41
|
|
Manager
shares, $0.001 par value; 100 shares authorized, issued and
outstanding
|
—
|
—
|
|
Additional paid-in capital
|
658,522
|
658,492
|
|
Retained
earnings
|
117,402
|
104,143
|
|
Accumulated other comprehensive loss, net
|
(17,091)
|
(13,853)
|
|
Total
shareholders' equity
|
758,874
|
748,823
|
|
Total liabilities
and shareholders' equity
|
$ 4,224,670
|
$ 3,672,359
|
|
|
|
FLY Leasing
Limited
|
|
Consolidated
Statements of Cash Flows
|
|
(DOLLARS IN
THOUSANDS)
|
|
|
Year
ended
|
|
Year
ended
|
|
Dec. 31, 2014
(Audited)
|
|
Dec. 31, 2013
(Audited)
|
|
Cash Flows from
Operating Activities
|
|
|
|
|
|
|
Net Income
|
$
|
56,077
|
|
$
|
52,476
|
|
Adjustments to reconcile net income to net cash flows provided by
operating activities:
|
|
|
|
|
|
|
Equity
earnings from unconsolidated subsidiary
|
|
(2,456)
|
|
|
(1,871)
|
|
Gain on
sale of aircraft
|
|
(18,878)
|
|
|
(6,277)
|
|
Depreciation
|
|
175,547
|
|
|
146,400
|
|
Aircraft
impairment
|
|
—
|
|
|
8,825
|
|
Amortization of debt issuance costs
|
|
5,380
|
|
|
5,735
|
|
Amortization of lease incentives
|
|
18,934
|
|
|
9,019
|
|
Amortization of lease discounts/premiums and other items
|
|
9,977
|
|
|
8,173
|
|
Amortization of fair market value adjustments associated with the
GAAM acquisition
|
|
6,260
|
|
|
12,602
|
|
Net gain
on extinguishment of debt
|
|
(3,960)
|
|
|
(15,881)
|
|
Share-based compensation
|
|
30
|
|
|
3,177
|
|
Provision
for deferred income taxes
|
|
6,169
|
|
|
6,195
|
|
Unrealized loss (gain) on derivative instruments
|
|
38
|
|
|
(1,263)
|
|
Security
deposits and maintenance payment liability relieved
|
|
(30,376)
|
|
|
(31,360)
|
|
Security
deposits and maintenance payment claims applied towards operating
lease revenues
|
|
—
|
|
|
(2,596)
|
|
Distributions from unconsolidated subsidiary
|
|
5,501
|
|
|
—
|
|
Changes in
operating assets and liabilities:
|
|
|
|
|
|
|
Rent receivables
|
|
(4,767)
|
|
|
(4,982)
|
|
Other assets
|
|
(1,589)
|
|
|
(1,969)
|
|
Payable to related parties
|
|
(12,848)
|
|
|
(10,544)
|
|
Accounts payable and accrued liabilities
|
|
7,407
|
|
|
(1,305)
|
|
Rentals received in advance
|
|
2,699
|
|
|
2,344
|
|
Other liabilities
|
|
8,020
|
|
|
4,576
|
|
Net cash flows
provided by operating activities
|
|
227,165
|
|
|
181,474
|
|
Cash Flows from
Investing Activities
|
|
|
|
|
|
|
Distributions from unconsolidated subsidiary
|
|
1,132
|
|
|
—
|
|
Purchase of additional aircraft
|
|
(915,450)
|
|
|
(632,944)
|
|
Proceeds from sale of aircraft
|
|
88,617
|
|
|
48,539
|
|
Payment for aircraft improvement
|
|
(9,841)
|
|
|
—
|
|
Lessor contribution to maintenance
|
|
(5,017)
|
|
|
(24,185)
|
|
Net cash flows
used in investing activities
|
|
(840,559)
|
|
|
(608,590)
|
|
|
|
|
|
|
|
|
|
|
|
|
Year
ended
|
|
Year
ended
|
|
Dec. 31, 2014
(Audited)
|
|
Dec. 31, 2013
(Audited)
|
|
Cash Flows from
Financing Activities
|
|
|
|
|
|
|
Restricted cash and cash equivalents
|
|
35,690
|
|
|
(39,731)
|
|
Security deposits received
|
|
18,134
|
|
|
13,910
|
|
Security deposits returned
|
|
(4,728)
|
|
|
(7,271)
|
|
Maintenance payment liability receipts
|
|
85,172
|
|
|
56,968
|
|
Maintenance payment liability disbursements
|
|
(45,412)
|
|
|
(16,612)
|
|
Debt extinguishment costs
|
|
—
|
|
|
(3,856)
|
|
Proceeds from unsecured borrowings
|
|
396,563
|
|
|
291,389
|
|
Proceeds from secured borrowings
|
|
298,658
|
|
|
587,083
|
|
Proceeds from Term Loan upsizing
|
|
—
|
|
|
101,892
|
|
Debt issuance costs
|
|
(1,803)
|
|
|
(11,825)
|
|
Repayment of secured borrowings
|
|
(192,974)
|
|
|
(444,607)
|
|
Proceeds from issuance of shares, net of fees paid
|
|
—
|
|
|
172,595
|
|
Dividends
|
|
(41,392)
|
|
|
(30,531)
|
|
Dividend equivalents
|
|
(1,426)
|
|
|
(940)
|
|
Net cash flows
provided by financing activities
|
|
546,482
|
|
|
668,464
|
|
Net increase
(decrease) in cash
|
|
(66,912)
|
|
|
241,348
|
|
Cash at beginning of period
|
|
404,472
|
|
|
163,124
|
|
Cash at end of
period
|
$
|
337,560
|
|
$
|
404,472
|
|
|
|
|
|
|
|
Supplemental
Disclosure:
|
|
|
|
|
|
|
Cash paid during the period for:
|
|
|
|
|
|
|
Interest
|
$
|
119,745
|
|
$
|
97,451
|
|
Taxes
|
|
188
|
|
|
84
|
|
Noncash
Activities:
|
|
|
|
|
|
|
Other
liabilities applied to maintenance payment liability and rent
receivables
|
|
979
|
|
|
—
|
|
Security
deposits applied to maintenance payment liability, rent
receivables, rentals received in advance, and other
assets
|
|
1,938
|
|
|
1,414
|
|
Maintenance payment liability applied to rent receivables and
rentals received in advance
|
|
--
|
|
|
4,446
|
|
Noncash
activities in connection with purchase of aircraft:
|
|
|
|
|
|
|
Security deposits and maintenance payment liability
assumed
|
|
16,559
|
|
|
1,774
|
|
Other liabilities applied to purchase of aircraft
|
|
6,885
|
|
|
—
|
|
Rent receivable applied to purchase of aircraft
|
|
1,567
|
|
|
—
|
|
Deposits applied to purchase of aircraft
|
|
991
|
|
|
—
|
|
Noncash activities in connection with sale of aircraft:
|
|
|
|
|
|
|
Security deposits and maintenance payment liability
applied
|
|
8,678
|
|
|
—
|
|
Refundable deposits applied to sale of aircraft
|
|
3,376
|
|
|
—
|
|
Rent receivable applied to sale of aircraft
|
|
425
|
|
|
—
|
|
Secured borrowings assumed by
buyer
|
|
—
|
|
|
38,500
|
|
Derivative liabilities assumed by buyer
|
|
—
|
|
|
5,000
|
|
|
|
FLY Leasing
Limited
|
|
Reconciliation of
Adjusted Net Income, a Non-GAAP Financial Measure, to Net
Income
|
|
(DOLLARS IN
THOUSANDS, EXCEPT PER SHARE DATA)
|
|
|
Three months
ended
Dec. 31, 2014
(Unaudited)
|
Three months
ended
Dec. 31, 2013
(Unaudited)
|
Year
ended
Dec. 31, 2014
(Unaudited)
|
Year
ended
Dec. 31, 2013
(Unaudited)
|
|
Net Income
|
$ 15,479
|
$ 13,412
|
$ 56,077
|
$ 52,476
|
|
Add (less):
|
|
|
|
|
|
Ineffective, dedesignated and terminated derivatives
|
189
|
(243)
|
72
|
(1,263)
|
|
Net
(gain) loss on extinguishment of debt
|
88
|
(18,585)
|
(3,922)
|
(15,881)
|
|
Aircraft
impairment
|
—
|
8,825
|
—
|
8,825
|
|
Non-cash
share based compensation
|
80
|
892
|
30
|
3,177
|
|
Adjustments related to GAAM Portfolio acquisition:
|
|
|
|
|
|
Amortization of fair value
adjustments recorded in purchase accounting
|
1,307
|
1,647
|
6,260
|
12,602
|
|
Income
tax effects
|
(202)
|
(1,045)
|
(1,148)
|
(2,553)
|
|
Adjusted Net
Income
|
$ 16,941
|
$ 4,903
|
$ 57,369
|
$ 57,383
|
|
Weighted average
diluted shares outstanding
|
41,479,349
|
41,431,486
|
41,527,584
|
34,243,456
|
|
Adjusted Net
Income per share
|
$ 0.41
|
$ 0.12
|
$ 1.38
|
$
1.68
|
|
|
|
|
|
|
|
|
Adjusted Net
Income Plus Depreciation and Amortization, a Non-GAAP Financial
Measure, to Net Income
|
|
(DOLLARS IN
THOUSANDS)
|
|
|
Three months
ended
Dec. 31, 2014
(Unaudited)
|
Three months
ended
Dec. 31, 2013
(Unaudited)
|
Year
ended
Dec. 31,
2014
(Unaudited)
|
Year
ended
Dec. 31,
2013
(Unaudited)
|
|
Adjusted Net
Income
|
$ 16,941
|
$ 4,903
|
$ 57,369
|
$ 57,383
|
|
Add:
|
|
|
|
|
|
Depreciation
|
49,059
|
39,749
|
175,547
|
146,400
|
|
Other
amortization
|
9,209
|
4,784
|
33,320
|
21,676
|
|
Provision for deferred income taxes
|
829
|
194
|
7,317
|
8,748
|
|
Adjusted Net
Income Plus Depreciation and Amortization
|
$ 76,038
|
$ 49,630
|
$ 273,553
|
$ 234,207
|
|
|
|
|
|
FLY defines Adjusted Net Income as net income plus or minus the
after-tax impacts of ineffective, dedesignated or terminated cash
flow hedges, non-cash share-based compensation, gains and losses on
extinguishment of debt, impairment charges, and adjustments related
to the GAAM portfolio acquisition comprised of amortization of fair
value adjustments recorded in purchase accounting. FLY believes
that Adjusted Net Income provides information that is useful in
evaluating the operating performance of FLY's business and
facilitates period over period comparisons. It also provides
additional information that is useful for evaluating the underlying
operating performance of FLY's business without regard to gains and
losses related to refinancing activity, impairment charges, share
based compensation, changes in the fair value of ineffective cash
flow hedges, and the impacts of fair-value adjustments of debt and
leases that FLY assumed in connection with the GAAM
portfolio.
Adjusted Net Income Plus Depreciation and Amortization is a cash
flow measure that provides investors with an additional measure for
evaluating FLY's ongoing cash earnings, from which capital
investments are made, debt is serviced and dividends are
paid. However, this measure excludes certain positive and
negative cash items, including principal payments on debt, and
therefore has certain important limitations as an indicator of
FLY's ability to pay dividends and reinvest in its business.
Management uses Adjusted Net Income and Adjusted Net Income Plus
Depreciation and Amortization as measures for assessing FLY's
performance.
Adjusted Net Income and Adjusted Net Income Plus Depreciation
and Amortization should be considered as supplements to, and not as
a substitute for net income or other financial measures determined
in accordance with U.S. generally accepted accounting
principles. FLY's definitions may be different than those
used by other companies.
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SOURCE FLY Leasing Limited