DUBLIN, May 8, 2015 /PRNewswire/ -- FLY Leasing Limited
(NYSE: FLY) ("FLY"), a global lessor of modern, fuel-efficient
commercial jet aircraft, today announced its financial results for
the first quarter of 2015.
First Quarter 2015 Highlights
- Net income of $17.3 million,
$0.41 per share
- Increased total revenues by 34% to $122.5 million
- Invested $147 million in four
aircraft
- Sold three aircraft for a $1.9
million gain over book value
- Re-priced Term Loan in April, saving $4
million in annual interest cost
- Declared Q1 dividend of $0.25 per
share
"FLY has started 2015 with strong first quarter results," said
Colm Barrington, FLY's CEO. "Our
investments have grown our fleet to 128 aircraft, an increase of 11
aircraft from a year ago, driving a 34% increase in total quarterly
revenues. We are targeting $750
million in aircraft acquisitions this year and have acquired
and identified $475 million of
aircraft to date. Meanwhile, we continue to opportunistically trade
aircraft, selling three aircraft in the first quarter for a gain of
$1.9 million over book value."
"Our net income of $17.3 million,
or $0.41 per share, is a significant
increase over the first quarter of last year, and is largely due to
our growing fleet," added Barrington. "We also continue to return
capital to shareholders, declaring our 30th consecutive
quarterly dividend."
"We actively manage the company's capital structure, just as we
actively manage our fleet, taking advantage of the favorable
funding environment and our access to well-priced debt," said
Barrington. "In April, we re-priced our Term Loan, which will
reduce our interest cost by approximately $4
million annually."
"Globally the airline industry is on a strong trajectory, with
air traffic growth and airline profits exceeding the levels of
recent years," added Barrington. "These conditions benefit lessors,
including FLY, by providing strong demand for leased aircraft with
a resultant firming in lease rates and aircraft values."
Financial Results
FLY is reporting net income for the first quarter of 2015 of
$17.3 million or $0.41 per diluted share. This compares to
net income of $3.6 million or
$0.07 per diluted share for the same
period in 2014. The first quarter 2015 results include
$21.9 million of end of lease revenue
and a charge of approximately $4.0
million associated with termination of the Aircraft
Acquisition Facility. End of lease revenue was $3.7 million in the first quarter of 2014.
Total revenues increased 34% to $122.5
million and include $120.1
million of operating lease revenue and $1.9 million in gains from the sale of three
aircraft. Operating lease revenue increased $30.5 million over the same period in the
preceding year.
Adjusted Net Income
Adjusted Net Income was $26.6
million for the first quarter of 2015 compared to
$9.8 million in the same period in
the previous year. On a per share basis, Adjusted Net Income
was $0.64 in the first quarter of
2015 compared to $0.24 for the same
period in the previous year.
A reconciliation of Adjusted Net Income to net income determined
in accordance with GAAP is shown below.
Dividends and Share Repurchases
On April 15, 2015, FLY declared a
dividend of $0.25 per share in
respect of the first quarter of 2015. This dividend will be paid on
May 20, 2015 to shareholders of
record on April 30, 2015. FLY
has now paid dividends totaling $7.62
since its listing in 2007.
On May 6, 2015, FLY's board of
directors approved a $30 million
share repurchase program expiring in May
2016 to replace the previous program. Under this
program, FLY may make share repurchases from time to time in the
open market or in privately negotiated transactions. The
timing of the repurchases under this program will depend upon a
variety of factors, including market conditions, and the program
may be suspended or discontinued at any time.
Financial Position
At March 31, 2015, FLY's total
assets were $4.1 billion, including
flight equipment with a net book value of $3.7 billion. Cash and cash equivalents at
March 31, 2015 totaled $416.6 million, of which $280.3 million was unrestricted. In
addition, FLY had 17 unencumbered aircraft with an aggregate net
book value of $632.4 million at
March 31, 2015.
Aircraft Portfolio
At March 31, 2015, FLY's 128
aircraft, as shown in the table below, were on lease to 63 airlines
in 35 countries.
|
Portfolio
at
|
Mar 31,
2015
|
Dec
31,
2014
|
|
Airbus
A319
|
18
|
18
|
|
Airbus
A320
|
29
|
27
|
|
Airbus
A321
|
5
|
3
|
|
Airbus
A330
|
4
|
4
|
|
Airbus
A340
|
3
|
3
|
|
Boeing 737
|
54
|
57
|
|
Boeing 747
|
1
|
1
|
|
Boeing 757
|
11
|
11
|
|
Boeing 767
|
1
|
1
|
|
Boeing 777
|
1
|
1
|
|
Boeing 787
|
1
|
1
|
|
Total
|
128
|
127
|
|
Note: The table
does not include two B767 aircraft owned by a joint venture in
which FLY has a 57% interest.
|
At March 31, 2015, the average age
of the portfolio was 8.1 years weighted by the net book value of
each aircraft. The average remaining lease term was 5.1 years, also
weighted by net book value. At March 31,
2015, FLY's leases were generating annualized rental
revenues of approximately $424.1
million.
Conference Call and Webcast
FLY's senior management will host a conference call and webcast
to discuss these results at 10:00
a.m. U.S. Eastern Time on Friday, May
8, 2015. Participants should dial +1-253-237-1145
(International) or 800-535-7056 (North
America) and enter confirmation code 21363329 or ask an
operator for the FLY Leasing earnings call. A replay will be
available shortly after the live call. To access the replay, please
dial +1-404-537-3406 (International) or 855-859-2056 (North America) and enter confirmation code
21363329. The replay recording will be available for ten
days. A live webcast of the conference call will be also
available in the investor relations section of FLY's website at
www.flyleasing.com. An archived webcast will be available on FLY's
website 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 month
period ended
Mar. 31,
2015
(Unaudited)
|
Three month
period ended
Mar. 31,
2014
(Unaudited)
|
|
Revenues
|
|
|
|
Operating lease rental revenue
|
$ 103,148
|
$ 90,536
|
|
End of
lease revenue
|
21,936
|
3,679
|
|
Amortization of lease incentives
|
(4,036)
|
(3,388)
|
|
Amortization of lease premiums/discounts and other
|
(945)
|
(1,200)
|
|
Operating lease revenue
|
120,103
|
89,627
|
|
Gain on
sale of aircraft
|
1,897
|
-
|
|
Equity
earnings from unconsolidated subsidiary
|
340
|
1,382
|
|
Interest
and other income
|
206
|
310
|
|
Total
revenues
|
122,546
|
91,319
|
|
Expenses
|
|
|
|
Depreciation
|
50,074
|
40,403
|
|
Interest
expense
|
39,297
|
34,625
|
|
Debt modification and extinguishment costs
|
4,050
|
15
|
|
Selling,
general and administrative
|
8,264
|
9,615
|
|
Ineffective and dedesignated derivatives
|
(264)
|
(65)
|
|
Maintenance and other costs
|
1,586
|
2,410
|
|
Total
expenses
|
103,007
|
87,003
|
|
Net income before
provision for income taxes
|
19,539
|
4,316
|
|
Provision for income taxes
|
2,273
|
753
|
|
Net
income
|
$ 17,266
|
$ 3,563
|
|
Weighted average
number of shares:
|
|
|
|
-
Basic
|
41,432,998
|
41,333,938
|
|
-
Diluted
|
41,545,287
|
41,393,731
|
|
Earnings per share
(net income per common share):
|
|
|
|
- Basic and
diluted
|
$ 0.41
|
$ 0.07
|
|
Dividends declared
and paid per share
|
$ 0.25
|
$ 0.25
|
|
|
|
FLY Leasing
Limited
|
|
Consolidated
Balance Sheets
|
|
|
(DOLLARS IN
THOUSANDS, EXCEPT PER SHARE DATA)
|
|
|
Mar.
31,
2015
(Unaudited)
|
Dec.
31,
2014
(Audited)
|
|
Assets
|
|
|
|
Cash and
cash equivalents
|
$ 280,285
|
$ 337,560
|
|
Restricted cash and cash equivalents
|
136,336
|
139,139
|
|
Rent
receivables
|
11,002
|
4,887
|
|
Investment in unconsolidated subsidiary
|
4,342
|
4,002
|
|
Flight
equipment held for operating lease, net
|
3,678,090
|
3,705,407
|
|
Fair
market value of derivative assets
|
131
|
2,067
|
|
Other
assets, net
|
24,247
|
31,608
|
|
Total
assets
|
4,134,433
|
4,224,670
|
|
Liabilities
|
|
|
|
Accounts
payable and accrued liabilities
|
33,185
|
18,431
|
|
Rentals
received in advance
|
18,697
|
19,751
|
|
Payable
to related parties
|
2,704
|
2,772
|
|
Security
deposits
|
59,668
|
64,058
|
|
Maintenance payment liability
|
244,385
|
254,514
|
|
Unsecured borrowings, net
|
689,866
|
689,452
|
|
Secured
borrowings, net
|
2,240,721
|
2,335,328
|
|
Fair
market value of derivative liabilities
|
28,087
|
23,311
|
|
Deferred
tax liability, net
|
17,614
|
16,289
|
|
Other
liabilities
|
39,820
|
41,890
|
|
Total
liabilities
|
3,374,747
|
3,465,796
|
|
Shareholders' equity
|
|
|
|
Common shares, $0.001
par value, 499,999,900 shares authorized; 41,432,998 shares issued
and outstanding at March 31, 2015 and December 31, 2014
|
41
|
41
|
|
Manager
shares, $0.001 par value; 100 shares authorized, issued and
outstanding
|
−
|
−
|
|
Additional paid in capital
|
658,674
|
658,522
|
|
Retained
earnings
|
124,119
|
117,402
|
|
Accumulated other comprehensive loss, net
|
(23,148)
|
(17,091)
|
|
Total
shareholders' equity
|
759,686
|
758,874
|
|
Total liabilities
and shareholders' equity
|
$ 4,134,433
|
$ 4,224,670
|
|
|
|
FLY Leasing
Limited
|
|
Consolidated
Statements of Cash Flows
|
|
|
(DOLLARS IN
THOUSANDS)
|
|
|
|
Three
month
period
ended
Mar. 31, 2015
(Unaudited)
|
|
Three
month
period
ended
Mar. 31,
2014
(Unaudited)
|
|
|
Cash Flows from
Operating Activities
|
|
|
|
|
|
|
Net Income
|
$
|
17,266
|
|
$
|
3,563
|
|
Adjustments to
reconcile net income to net cash flows provided by operating
activities:
|
|
|
|
|
|
|
Equity in earnings
from unconsolidated subsidiary
|
|
(340)
|
|
|
(1,382)
|
|
Gain on sale of
aircraft
|
|
(1,897)
|
|
|
-
|
|
Depreciation
|
|
50,074
|
|
|
40,403
|
|
Amortization of debt
discounts and issuance costs
|
|
3,110
|
|
|
3,142
|
|
Amortization of lease
incentives
|
|
4,036
|
|
|
3,388
|
|
Amortization of lease
discounts/premiums and other items
|
|
719
|
|
|
632
|
|
Amortization of fair
market value adjustments associated with the GAAM
acquisition
|
|
1,237
|
|
|
1,929
|
|
Debt modification and
extinguishment costs
|
|
4,050
|
|
|
-
|
|
Share-based
compensation
|
|
152
|
|
|
(56)
|
|
Unrealized foreign
exchange loss on cash balances
|
|
330
|
|
|
(33)
|
|
Unrealized foreign
exchange gain on Euro denominated secured borrowing
|
|
(2,000)
|
|
|
-
|
|
Provision for deferred
income taxes
|
|
2,026
|
|
|
634
|
|
Unrealized gain on
derivative instruments
|
|
(264)
|
|
|
(65)
|
|
Security deposits and
maintenance payment liability recognized into earnings
|
|
(21,936)
|
|
|
(3,268)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
Rent
receivables
|
|
(1,685)
|
|
|
(2,079)
|
|
Other
assets
|
|
2,375
|
|
|
(568)
|
|
Payable to related
parties
|
|
(3,632)
|
|
|
(1,742)
|
|
Accounts payable and
accrued liabilities
|
|
11,794
|
|
|
5,536
|
|
Rentals received in
advance
|
|
(1,054)
|
|
|
(773)
|
|
Other
liabilities
|
|
(2,606)
|
|
|
4,470
|
|
Net cash flows
provided by operating activities
|
|
61,755
|
|
|
53,731
|
|
Cash Flows from
Investing Activities
|
|
|
|
|
|
|
Purchase of flight
equipment
|
|
(137,113)
|
|
|
(81,837)
|
|
Proceeds from sale of
aircraft, net
|
|
126,503
|
|
|
-
|
|
Payment for aircraft
improvement
|
|
(4,403)
|
|
|
-
|
|
Payments for
maintenance
|
|
(7,730)
|
|
|
(6,791)
|
|
Net cash flows
used in investing activities
|
|
(22,743)
|
|
|
(88,628)
|
|
|
|
|
|
Three
month
period
ended
Mar. 31, 2015
(Unaudited)
|
|
Three
month
period
ended
Mar. 31,
2014
(Unaudited)
|
|
|
Cash Flows from
Financing Activities
|
|
|
|
|
|
|
Restricted cash and
cash equivalents
|
|
2,803
|
|
|
41,188
|
|
Security deposits
received
|
|
845
|
|
|
2,100
|
|
Security deposits
returned
|
|
(2,868)
|
|
|
-
|
|
Maintenance payment
liability receipts
|
|
17,514
|
|
|
33,172
|
|
Maintenance payment
liability disbursements
|
|
(8,332)
|
|
|
(4,195)
|
|
Proceeds from
termination of interest rate swaps
|
|
23
|
|
|
-
|
|
Debt issuance
costs
|
|
(343)
|
|
|
(197)
|
|
Proceeds from secured
borrowings
|
|
67,802
|
|
|
-
|
|
Repayment of secured
borrowings
|
|
(162,852)
|
|
|
(44,162)
|
|
Dividends
|
|
(10,358)
|
|
|
(10,327)
|
|
Dividend
equivalents
|
|
(191)
|
|
|
(676)
|
|
Net cash
flows(used in) provided by financing activities
|
|
(95,957)
|
|
|
16,903
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
(330)
|
|
|
33
|
|
Net decrease in
cash
|
|
(57,275)
|
|
|
(17,961)
|
|
Cash at beginning of
period
|
|
337,560
|
|
|
404,472
|
|
Cash at end of
period
|
$
|
280,285
|
|
$
|
386,511
|
|
|
|
|
|
|
|
Supplemental
Disclosure:
|
|
|
|
|
|
|
Cash paid during
the period for:
|
|
|
|
|
|
|
Interest
|
$
|
24,059
|
|
$
|
24,725
|
|
Income
taxes
|
|
110
|
|
|
137
|
|
Supplemental
disclosure of noncash activities:
|
|
|
|
|
|
|
Aircraft
improvement
|
|
2,510
|
|
|
621
|
|
Security deposits
applied to maintenance payment liability and rent
receivables
|
|
2,542
|
|
|
358
|
|
Maintenance payment
liability applied to rent receivables
|
|
2,108
|
|
|
-
|
|
Other liabilities
applied to maintenance payment liability and rent
receivables
|
|
240
|
|
|
979
|
|
Noncash activities in
connection with purchase of aircraft:
|
|
|
|
|
|
|
Rent receivable
applied
|
|
626
|
|
|
-
|
|
Security deposits
assumed
|
|
1,743
|
|
|
590
|
|
Lease incentive
obligation
|
|
6,099
|
|
|
-
|
|
Noncash activities in
connection with sale of aircraft:
|
|
|
|
|
|
|
Rent receivable
applied
|
|
695
|
|
|
-
|
|
Refundable deposits
applied
|
|
2,250
|
|
|
-
|
|
Security deposits and
maintenance reserves transferred
|
|
6,116
|
|
|
-
|
|
|
|
FLY Leasing
Limited
|
|
Reconciliation of
Non-GAAP Measures
|
|
|
(DOLLARS IN
THOUSANDS, EXCEPT PER SHARE DATA)
|
|
|
Three
month
period
ended
March 31,
2015
(Unaudited)
|
Three
month
period
ended
March 31,
2014
(Unaudited)
|
|
Net
income
|
$
17,266
|
$
3,563
|
|
Amortization of debt
discounts and loan issuance costs
|
3,110
|
3,142
|
|
Amortization of lease
discounts/premiums and other items
|
719
|
632
|
|
Amortization of GAAM
acquisition date fair market value adjustments
|
1,237
|
1,929
|
|
Debt modification and
extinguishment costs
|
4,050
|
15
|
|
Share-based
compensation
|
152
|
(56)
|
|
Unrealized foreign
exchange gain
|
(1,670)
|
(33)
|
|
Deferred income
taxes
|
2,026
|
634
|
|
Ineffective,
dedesignated and terminated derivatives
|
(264)
|
(65)
|
|
Adjusted Net
Income
|
$
26,626
|
$
9,761
|
|
Average
Shareholders' Equity
|
$ 759,280
|
$ 744,698
|
|
Adjusted Return on
Equity
|
14.0%
|
5.2%
|
|
|
|
|
Weighted average
diluted shares outstanding
|
41,545,287
|
41,393,731
|
|
Adjusted Net
Income per diluted share
|
$0.64
|
$0.24
|
FLY defines Adjusted Net Income as net income plus or minus (i)
non-cash amortization of debt discounts, loan issuance costs, lease
discounts/premiums and other items; (ii) adjustments related to the
GAAM portfolio acquisition comprised primarily of amortization of
fair value adjustments recorded in purchase accounting; (iii) debt
modification and extinguishment costs; (iv) non-cash share-based
compensation; (v) unrealized foreign exchange gain/loss; (vi)
deferred income taxes; and (vii) the ineffective portion and other
comprehensive items associated with terminated cash flow hedges.
Adjusted Return on Equity is calculated by dividing Adjusted Net
Income over the average shareholders' equity for the period
presented. For periods of less than one year, Adjusted Net Income
for the relevant period is annualized in calculating Adjusted
Return on Equity.
We use Adjusted Net Income and Adjusted Return on Equity to
assess our core operating performance on a consistent basis from
period to period. In addition, Adjusted Net Income and Adjusted
Return on Equity help us compare our performance to our
competitors. These measures should be considered in addition to,
not as a substitute for net income or other financial measures
determined in accordance with Accounting Principles Generally
Accepted in the United States.
FLY's definitions may be different than those used by other
companies.
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SOURCE FLY Leasing Limited