AerCap Holdings N.V. Reports Third Quarter 2011 Financial Results

AMSTERDAM, Nov. 8, 2011 /PRNewswire/ — AerCap Holdings N.V. (the “Company” or “AerCap”) (NYSE: AER) today announced the results of its operations for the third quarter ended September 30, 2011.

Third Quarter 2011 Highlights

Net income

Third quarter 2011 reported net loss was $7.1 million, compared with reported net income of $51.9 million for the same period in 2010.
Third quarter 2011 adjusted net income was $75.6 million, an increase of 24% compared to third quarter 2010 adjusted net income of $61.1 million. Adjusted net income excludes $29.2 million of non-cash charges relating to the mark-to-market of interest rate caps and share-based compensation. In addition, adjusted net income excludes certain one-time charges incurred in connection with the AeroTurbine sale which closed on October 7, 2011 and is reflected as a discontinued operation for the third quarter financial results. Those charges include $22.5 million of one-time transaction expenses, $10.0 million deferred tax asset write-off, and a $21.0 million book loss arising from the sale.

Earnings per share

Third quarter 2011 reported basic and diluted loss per share was $0.05, compared with reported basic and diluted earnings per share of $0.43 for the same period in 2010.
Third quarter 2011 adjusted basic and diluted earnings per share, which excludes the items mentioned above, was $0.51, unchanged from the same period in 2010.

Other financial highlights

Margin earned on lease assets (net spread) was $182.3 million in the third quarter of 2011 compared to $164.4 million in the third quarter of 2010, an increase of 11%.
Committed purchases of aviation assets delivered or scheduled for delivery in 2011 are $934 million.
Total assets were $9.6 billion at September 30, 2011, an increase of 2% over total assets of $9.3 billion at September 30, 2010. The increase was driven primarily by deliveries of forward order aircraft.
Debt to equity ratio was 2.8 times at September 30, 2011, compared to 3.3 times at September 30, 2010.
To date we have purchased 9.4 million shares at an average price of $10.64 per share which completes our $100 million share repurchase program for 2011.
AerCap signed a $400 million credit facility to provide long term financing for 12 Boeing 737-800 aircraft. The aircraft will be leased to American Airlines and form part of AerCap’s previously announced transaction with American Airlines for the purchase and leaseback of up to 35 Boeing 737-800 aircraft.

Aengus Kelly, CEO of AerCap, commented: “AerCap’s third quarter operating profit demonstrates our ability to deliver strong results even in an uncertain economic environment. Our strong balance sheet, reflected by our conservative 2.8 times debt equity ratio, has afforded us the financial flexibility to return capital to shareholders via our executed $100 million share repurchase program at a 33% discount to book value.”

AerCap’s CFO, Keith Helming, added: “Notwithstanding adverse global market conditions, AerCap’s capital position has never been stronger. With the recently completed AeroTurbine sale our total cash position exceeds $600 million. Also, we have arranged all aircraft funding requirements through 2012 including the financing for the aircraft to be delivered under the American Airlines purchase and leaseback arrangement. As a result, AerCap is extremely well positioned to take advantage of market opportunities that might arise in the coming year.”

Basic lease rents were $238.6 million for the third quarter of 2011, an increase of 6% compared to the third quarter of 2010, as a result of our growing asset base. Our average lease assets increased by 6% to $8.0 billion compared to the third quarter of 2010.

Total lease revenue (basic rents, maintenance rents and other receipts) for the third quarter of 2011 was $265.6 million, compared to $239.4 million for the same period in 2010, an increase of 11%. The increases were mainly due to the deliveries of forward order aircraft.

Sales revenue for the third quarter of 2011 was $65.5 million, compared to $167.9 million for the same period in 2010. Sales revenue for the third quarter of 2011 was generated from the sale of six older aircraft. Sales revenue for the third quarter of 2010 was higher than the third quarter of 2011 due to the sale of one new A330 aircraft and two new A320 aircraft.

Total revenue for the third quarter of 2011 was $337.8 million, compared to $412.1 million for the same period in 2010 for the reasons mentioned above.

As shown in the table above, interest expense excluding the impact of the mark-to-market of interest rate caps was $56.3 million in the third quarter of 2011, a 7% decrease compared to the third quarter of 2010. As a result, net spread increased 11% to $182.3 million in the third quarter of 2011 over the same period in 2010.

As of September 30, 2011, AerCap’s portfolio consisted of 359 aircraft and 8 engines that were either owned, on order, under contract or letter of intent, or managed. The portfolio information excludes all engines and aircraft owned by AeroTurbine at September 30, 2011.