Air Lease Corporation Announces Third Quarter 2012 Results

LOS ANGELES—(BUSINESS WIRE)—Air Lease Corporation (ALC) (NYSE: AL) announced today the results of its operations for the three and nine months ended September 30, 2012.

Highlights

Air Lease Corporation reports another consecutive quarter of fleet, revenue, profitability and financing growth:

Doubled diluted EPS to $0.36 per share in the third quarter of 2012 compared to $0.18 in the third quarter of 2011. Diluted EPS increased 173% to $0.90 per share for the nine months ended September 30, 2012 compared to $0.33 per share for the nine months ended September 30, 2011.
Delivered five aircraft from our order book, growing our fleet to 142 aircraft, cost now exceeds $6 billion and is spread across a diverse and balanced customer base of 66 airlines and 37 countries.
Completed successful senior unsecured notes offering of $500 million due 2016 bearing interest at a rate of 4.5%.

“We are pleased with ALC’s strong financial and operating performance this quarter, resulting in doubled year over year EPS. Our business model and fundamentals are producing results that exceed the internal plans laid out at the Company’s founding. We continue to execute our robust growth trajectory due to our contracted delivery stream that carries on into the next decade. Although global macro concerns continue to exist, our experienced leadership team has planned ALC’s business model from the outset to adapt to cyclical changes in the industry,” said Steven F. Udvár-Hazy, Chairman and Chief Executive Officer of Air Lease Corporation.

“We completed our final placements for 2013 and 2014, and now turn our attention to the back half of 2015. ALC has on order the aircraft types that the market demands and the financing rates have remained low, resulting in yields that are in line with our plan. Our operating results follow our order pipeline, whereby a large second quarter of deliveries drove the strong third quarter revenue growth. As we have told you before, we have many aircraft in our pipeline delivering to Asian operators and you can now start to see our fleet concentration shifting in that direction. In particular, the major Chinese airlines are beginning a replacement cycle for their first generation western built aircraft, such as the Boeing 737-300/400,” said John L. Plueger, President and Chief Operating Officer of Air Lease Corporation.

Fleet Growth

Building on our base of 137 aircraft at June 30, 2012, we added five aircraft during the third quarter of 2012 and ended the quarter with 142 aircraft spread across a diverse and balanced customer base of 66 airlines based in 37 countries.

Over 90% of our aircraft are operated internationally.

We have made further progress in placing our aircraft. As of September 30, 2012, we have entered into contracts for the lease of all 70 aircraft delivering through 2014, for nine new aircraft delivering in 2015 and for eight new aircraft delivering after 2016.

Debt Financing Activities

During the third quarter of 2012, the Company entered into additional debt facilities aggregating $546.4 million, which included $450.0 million in senior unsecured notes, a $90.0 million addition to our Syndicated Unsecured Revolving Credit Facility and additional unsecured term facilities aggregating $6.4 million. We ended the quarter with total unsecured debt outstanding of $2.5 billion. The Company’s unsecured debt as a percentage of total debt increased to 58.6% as of September 30, 2012 from 31.7% as of December 31, 2011. We ended the third quarter of 2012 with a conservative balance sheet with low leverage and ample available liquidity of $1.47 billion. As part of our financing strategy we will continue to focus on financing the Company on an unsecured basis.

We will continue to focus our financing efforts on raising unsecured debt through the international and domestic capital markets, the global bank market, reinvesting cash flow from operations and, to a limited extent, secured financings including government guaranteed loan programs from the European Export Credit Agencies in support of our new Airbus aircraft deliveries, from Ex-Im Bank in support of our new Boeing aircraft deliveries and direct financing from BNDES/SBCE in support of our new Embraer deliveries.

As of September 30, 2012, we had established a diverse lending group consisting of 33 banks across four general types of lending facilities.