DUBLIN, May 18, 2016 /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 2016.
First Quarter 2016 Highlights
- Adjusted Net Income of $16.2
million, $0.47 per share
- Net income of $7.1 million,
$0.21 per share
- Closed $385 million aircraft
acquisition facility
- Sold ten aircraft generating gross proceeds of $60 million after debt repayment
- $445 million of aircraft
acquisitions scheduled to close in second quarter
"FLY moves into the second quarter having accomplished several
strategic objectives: completing the sale of 45% of our fleet –
primarily older aircraft – at gains to book value, repurchasing 19%
of our shares at a discount to book value, reducing core SG&A,
and completing a new, attractively priced $385 million aircraft acquisition facility," said
Colm Barrington, CEO of FLY.
"The company is in a strong position to deliver increased
return on equity going forward."
"We have ample financial capacity for our strategic objectives,
including $330 million in
unrestricted cash," added Barrington. "We expect to meet our
goal of adding $750 million of
aircraft to our fleet this year. The industry conditions remain
strong, airline traffic is robust, our fleet is 100% utilized and
we continue to see excellent global demand for leased
aircraft."
Financial Results
FLY is reporting net income for the first quarter of 2016 of
$7.1 million or $0.21 per diluted share. This compares to
net income of $19.9 million or
$0.47 per diluted share for the same
period in 2015. The first quarter 2015 results include
$21.9 million of end of lease
revenue, whereas there was only $3.2
million of end of lease revenue in the first quarter of
2016. All results for the first quarter of 2015 have been
restated as described in FLY's annual report on Form 20-F, which
was filed on May 2, 2016.
Adjusted Net Income
Adjusted Net Income was $16.2
million for the first quarter of 2016 compared to
$30.2 million in the same period in
the previous year. On a per share basis, Adjusted Net Income
was $0.47 in the first quarter of
2016 compared to $0.73 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.
Share Repurchases
During the first quarter, FLY repurchased 2.1 million shares for
approximately $25 million.
FLY's board of directors has approved an additional $30 million share repurchase program expiring in
March 2017 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 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, 2016, FLY's total
assets were $3.2 billion, including
an investment in flight equipment totaling $2.7 billion. Investment in flight equipment
includes $84.6 million of net
maintenance right assets. Cash and cash equivalents at
March 31, 2016 totaled $428.1 million, of which $329.3 million was unrestricted. In
addition, FLY had twelve unencumbered aircraft with an aggregate
net book value of $610.2 million at
March 31, 2016. The book value
per share at March 31, 2016 was
$18.83.
Aircraft Portfolio
At March 31, 2016, FLY's 79
aircraft, as shown in the table below, were on lease to 43 airlines
in 28 countries. The table does not show aircraft that were
held for sale which totaled four and thirteen, at March 31, 2016 and December 31, 2015, respectively, or the two B767
aircraft owned by a joint venture in which FLY has a 57% ownership
interest.
Portfolio
at
|
Mar 31,
2016
|
Dec
31,
2015
|
Airbus
A319
|
10
|
10
|
Airbus
A320
|
14
|
14
|
Airbus
A321
|
3
|
3
|
Airbus
A330
|
4
|
4
|
Airbus
A340
|
2
|
3
|
Boeing 737
|
39
|
39
|
Boeing 757
|
3
|
3
|
Boeing 767
|
1
|
1
|
Boeing 777
|
2
|
2
|
Boeing 787
|
1
|
1
|
Total
|
79
|
80
|
At March 31, 2016, the average age
of the portfolio was 6.8 years weighted by the net book value,
including maintenance rights, of each aircraft. The average
remaining lease term was 6.3 years, also weighted by net book
value, including maintenance rights. At March 31, 2016, the 79 aircraft were generating
annualized rental revenue of approximately $292 million.
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, May 18,
2016. Participants should dial +1-253-237-1145
(International) or 800-535-7056 (North
America) and enter confirmation code 84645567 or ask an
operator for the FLY earnings call. 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 months
ended
Mar. 31, 2016
(Unaudited)
|
Three months
ended
Mar. 31, 2015
(Restated &
Unaudited)
|
Revenues
|
|
|
Operating lease rental
revenue
|
$
74,633
|
$ 103,148
|
End of lease
revenue
|
3,206
|
21,936
|
Amortization of lease
incentives
|
(2,773)
|
(4,036)
|
Amortization of lease
premiums, discounts and other
|
(113)
|
(945)
|
Operating lease revenue
|
74,953
|
120,103
|
Finance lease
income
|
892
|
―
|
Gain on sale of
aircraft
|
5,143
|
2,637
|
Equity earnings from
unconsolidated subsidiary
|
133
|
340
|
Interest and other
income
|
87
|
206
|
Total
revenues
|
81,208
|
123,286
|
Expenses
|
|
|
Depreciation
|
28,839
|
47,203
|
Interest
expense
|
30,834
|
39,297
|
Debt modification and
extinguishment costs
|
4,527
|
4,050
|
Selling, general and
administrative
|
8,269
|
8,264
|
Ineffective and
dedesignated derivatives
|
286
|
(264)
|
Maintenance and other
costs
|
1,199
|
1,586
|
Total
expenses
|
73,954
|
100,136
|
Net income before
provision for income taxes
|
7,254
|
23,150
|
Provision for income
taxes
|
154
|
3,285
|
Net
income
|
$
7,100
|
$
19,865
|
Weighted average
number of shares:
|
|
|
-
Basic
|
34,287,783
|
41,432,998
|
-
Diluted
|
34,288,608
|
41,545,287
|
Earnings per share
(net income per common share):
|
|
|
- Basic and
diluted
|
$
0.21
|
$
0.47
|
FLY Leasing
Limited
|
Consolidated
Balance Sheets
|
(DOLLARS IN
THOUSANDS, EXCEPT PER SHARE DATA)
|
|
Mar.
31, 2016
(Unaudited)
|
Dec.
31, 2015
(Audited)
|
Assets
|
|
|
Cash and cash
equivalents
|
$ 329,273
|
$ 275,998
|
Restricted cash and
cash equivalents
|
98,875
|
174,933
|
Rent
receivables
|
875
|
124
|
Investment in
unconsolidated subsidiary
|
7,303
|
7,170
|
Investment in direct
finance lease, net
|
34,531
|
34,878
|
Flight equipment held
for sale, net
|
57,673
|
237,262
|
Flight equipment held
for operating lease, net
|
2,550,957
|
2,585,426
|
Maintenance right
asset, net
|
84,557
|
94,493
|
Fair market value of
derivative assets
|
―
|
241
|
Other
assets
|
6,240
|
6,450
|
Total
assets
|
3,170,284
|
3,416,975
|
Liabilities
|
|
|
Accounts payable and
accrued liabilities
|
30,101
|
17,548
|
Rentals received in
advance
|
13,211
|
14,560
|
Payable to related
parties
|
2,504
|
7,170
|
Security
deposits
|
44,741
|
48,876
|
Maintenance payment
liability
|
190,842
|
194,543
|
Unsecured borrowings,
net
|
689,904
|
689,409
|
Secured borrowings,
net
|
1,480,123
|
1,695,711
|
Fair market value of
derivative liabilities
|
25,784
|
19,327
|
Deferred tax
liability, net
|
20,030
|
20,741
|
Other
liabilities
|
40,389
|
52,126
|
Total
liabilities
|
2,537,629
|
2,760,011
|
Shareholders' equity
|
|
|
Common shares, $0.001
par value, 499,999,900 shares authorized; 33,599,490 and 35,671,400
shares issued and outstanding at March 31, 2016 and December 31,
2015, respectively
|
34
|
36
|
Manager shares, $0.001
par value; 100 shares authorized, issued and outstanding
|
―
|
―
|
Additional paid in
capital
|
552,158
|
577,290
|
Retained
earnings
|
102,238
|
95,138
|
Accumulated other
comprehensive loss, net
|
(21,775)
|
(15,500)
|
Total
shareholders' equity
|
632,655
|
656,964
|
Total liabilities
and shareholders' equity
|
$ 3,170,284
|
$ 3,416,975
|
FLY Leasing
Limited
|
Consolidated
Statements of Cash Flows
|
(DOLLARS IN
THOUSANDS)
|
|
|
|
Three
months ended Mar. 31, 2016
(Unaudited)
|
|
|
Three
months ended Mar. 31, 2015 (Restated &
Unaudited)
|
|
Cash Flows from
Operating Activities
|
|
|
|
|
|
|
|
Net Income
|
|
$
|
7,100
|
|
$
|
19,865
|
|
Adjustments to
reconcile net income to net cash flows provided by operating
activities:
|
|
|
|
|
|
|
|
Equity in earnings
from unconsolidated subsidiary
|
|
|
(133)
|
|
|
(340)
|
|
Direct finance lease
income
|
|
|
(892)
|
|
|
―
|
|
Gain on sale of
aircraft
|
|
|
(5,143)
|
|
|
(2,637)
|
|
Depreciation
|
|
|
28,839
|
|
|
47,203
|
|
Amortization of debt
discounts and issuance costs
|
|
|
2,360
|
|
|
3,110
|
|
Amortization of lease
incentives
|
|
|
2,773
|
|
|
4,036
|
|
Amortization of lease
discounts, premiums and other items
|
|
|
113
|
|
|
719
|
|
Amortization of fair
market value adjustments associated with the GAAM
acquisition
|
|
|
672
|
|
|
1,237
|
|
Debt modification and
extinguishment costs
|
|
|
3,679
|
|
|
4,050
|
|
Share-based
compensation
|
|
|
―
|
|
|
152
|
|
Unrealized foreign
exchange (gain) loss
|
|
|
1,001
|
|
|
(1,670)
|
|
Maintenance rights
cash receipts
|
|
|
6,150
|
|
|
―
|
|
Provision for deferred
income taxes
|
|
|
94
|
|
|
3,038
|
|
Unrealized (gain) loss
on derivative instruments
|
|
|
216
|
|
|
(264)
|
|
Security deposits and
maintenance payment liability recognized into earnings
|
|
|
(400)
|
|
|
(21,936)
|
|
Security deposits and
maintenance payment claims applied towards operating lease
revenues
|
|
|
(805)
|
|
|
―
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
Rent
receivables
|
|
|
(751)
|
|
|
(1,685)
|
|
Other
assets
|
|
|
(141)
|
|
|
2,375
|
|
Payable to related
parties
|
|
|
(7,239)
|
|
|
(3,632)
|
|
Accounts payable,
accrued and other liabilities
|
|
|
18,065
|
|
|
8,134
|
|
Net cash flows
provided by operating activities
|
|
|
55,558
|
|
|
61,755
|
|
Cash Flows from
Investing Activities
|
|
|
|
|
|
|
|
Rent received from
direct finance lease
|
|
|
1,230
|
|
|
―
|
|
Purchase of flight
equipment
|
|
|
―
|
|
|
(137,113)
|
|
Proceeds from sale of
aircraft, net
|
|
|
155,359
|
|
|
126,503
|
|
Payment for aircraft
improvement
|
|
|
(3,034)
|
|
|
(4,403)
|
|
Payments for
maintenance
|
|
|
(514)
|
|
|
(7,730)
|
|
Net cash flows
provided by (used in) investing activities
|
|
|
153,041
|
|
|
(22,743)
|
|
|
|
|
|
Three
months ended Mar. 31, 2016
(Unaudited)
|
|
|
Three
months ended Mar. 31, 2015
(Restated &
Unaudited)
|
|
Cash Flows from
Financing Activities
|
|
|
|
|
|
|
|
Restricted cash and
cash equivalents
|
|
|
76,058
|
|
|
2,803
|
|
Security deposits
received
|
|
|
―
|
|
|
845
|
|
Security deposits
returned
|
|
|
―
|
|
|
(2,868)
|
|
Maintenance payment
liability receipts
|
|
|
17,968
|
|
|
17,514
|
|
Maintenance payment
liability disbursements
|
|
|
(662)
|
|
|
(8,332)
|
|
Net swap termination
payments
|
|
|
(538)
|
|
|
23
|
|
Debt issuance
costs
|
|
|
(349)
|
|
|
(343)
|
|
Proceeds from secured
borrowings
|
|
|
16,756
|
|
|
67,802
|
|
Repayment of secured
borrowings
|
|
|
(239,645)
|
|
|
(162,852)
|
|
Shares
repurchased
|
|
|
(25,191)
|
|
|
―
|
|
Dividends
|
|
|
―
|
|
|
(10,358)
|
|
Dividend
equivalents
|
|
|
―
|
|
|
(191)
|
|
Net cash flows
used in financing activities
|
|
|
(155,603)
|
|
|
(95,957)
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
|
279
|
|
|
(330)
|
|
Net decrease in
cash
|
|
|
53,275
|
|
|
(57,275)
|
|
Cash at beginning of
period
|
|
|
275,998
|
|
|
337,560
|
|
Cash at end of
period
|
|
$
|
329,273
|
|
$
|
280,285
|
|
Supplemental
Disclosure:
|
|
|
|
|
|
|
|
Cash paid during
the period for:
|
|
|
|
|
|
|
|
Interest
|
|
$
|
16,573
|
|
$
|
24,059
|
|
Income
taxes
|
|
|
18
|
|
|
110
|
|
Supplemental
disclosure of noncash activities:
|
|
|
|
|
|
|
|
Security deposits
applied to maintenance payment liability and rent
receivables
|
|
|
―
|
|
|
2,542
|
|
Maintenance payment
liability applied to rent receivables
|
|
|
―
|
|
|
2,108
|
|
Other liabilities
applied to maintenance payment liability and rent
receivables
|
|
|
―
|
|
|
240
|
|
Noncash investing
activities:
|
|
|
|
|
|
|
|
Aircraft
improvement
|
|
|
2,338
|
|
|
2,510
|
|
Noncash activities in
connection with purchase of aircraft
|
|
|
―
|
|
|
8,468
|
|
Noncash activities in
connection with sale of aircraft
|
|
|
27,432
|
|
|
9,061
|
|
|
|
|
|
|
|
|
|
FLY Leasing
Limited
|
Reconciliation of
Non-GAAP Measures
|
(DOLLARS IN
THOUSANDS, EXCEPT PER SHARE DATA)
|
|
Three
months ended Mar. 31, 2016 (Unaudited)
|
Three
months ended Mar. 31, 2015 (Restated &
Unaudited)
|
Net
income
|
$
7,100
|
$
19,865
|
Amortization of debt
discounts and loan issuance costs
|
2,360
|
3,110
|
Amortization of lease
discounts, premiums and other items
|
113
|
719
|
Amortization of GAAM
acquisition date fair market value adjustments
|
672
|
1,237
|
Debt modification and
extinguishment costs
|
4,527
|
4,050
|
Share-based
compensation
|
―
|
152
|
Unrealized foreign
exchange (gain) loss
|
1,001
|
(1,670)
|
Deferred income
taxes
|
94
|
3,038
|
Ineffective,
dedesignated and terminated derivatives
|
286
|
(264)
|
Adjusted Net
Income
|
$
16,153
|
$
30,237
|
Average
Shareholders' Equity
|
$ 644,810
|
$
757,960
|
Adjusted Return on
Equity
|
10.0%
|
16.0%
|
|
|
|
Weighted average
diluted shares outstanding
|
34,288,608
|
41,545,287
|
Adjusted Net
Income per diluted share
|
$
0.47
|
$
0.73
|
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.
Logo -
http://photos.prnewswire.com/prnh/20130709/SF44539LOGO
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/fly-leasing-reports-first-quarter-2016-financial-results-300270658.html
SOURCE FLY Leasing Limited