Aircastle Announces First Quarter 2013 Results

STAMFORD, Conn., May 2, 2013 /PRNewswire/ — Aircastle Limited (the “Company” or “Aircastle”) (NYSE: AYR) reported first quarter 2013 net income of $23.1 million, or $0.34 per diluted common share, and adjusted net income of $27.4 million, or $0.40 per diluted common share. The first quarter results included lease rental and finance lease revenues of $160.5 million versus $152.2 million in the first quarter of 2012.

Commenting on the results, Ron Wainshal, Aircastle’s CEO, stated: “Effective portfolio management was a major driver of our solid first quarter results, as we demonstrated both our aircraft servicing skills as well as our ability to exit end-of-life aircraft investments profitably. Additionally, our aircraft purchase commitments for 2013 increased to more than $450 million, and we are encouraged by the growth in our new investment pipeline. With nearly $700 million in unrestricted cash and strong operating cash flow, Aircastle is in an excellent position to pursue accretive new purchase opportunities.”

First Quarter Results

Lease rental and finance lease revenues for the first quarter were $160.5 million, up $8.2 million or 5% year over year, due primarily to the impact of aircraft acquisitions of $25.9 million, partially offset by lower revenues from aircraft sold of $6.5 million and the effect of lease extensions, transitions and terminations of $11.2 million.

Total revenues for the first quarter were $176.2 million, an increase of $11.3 million, or 7% versus the previous year. The increase reflects $8.2 million of higher lease rental and finance lease revenues, $4.2 million of higher maintenance revenues associated with unscheduled lease terminations, and $4.3 million of higher other revenues from interest on debt investments and additional revenue in connection with early lease terminations. These increases were partially offset by higher amortization of net lease premiums and incentives in the first quarter of 2013 of $5.5 million, primarily due to two unscheduled lease transitions in the first quarter of the prior year which led to comparatively lower amortization of lease incentives.

During the first quarter of 2013 we early terminated leases for five aircraft in the wake of lessee financial difficulties. As a result, during the quarter we recorded maintenance and other revenues totaling $14.8 million which was partially offset by impairment charges totaling $6.2 million. Two of these five aircraft – an A319-100 and a B767-300ER – have been classified as held for sale.

Adjusted EBITDA for the first quarter was $168.6 million, up $16.7 million or 11% from the first quarter of 2012, driven primarily by higher lease rentals, maintenance and other revenues of $16.8.

Net income for the first quarter was $23.1 million, down $9.5 million, or 29%. Higher total revenues of $11.3 million and $1.0 million of higher gains from the sale of aircraft were offset by higher interest, net of $10.2 million, higher depreciation of $5.4 million and non-cash aircraft impairment charges of $6.2 million.

Adjusted net income for the quarter was $27.4 million, down $5.0 million year over year, and reflects higher total revenues of $11.3 million and $1.0 million of higher gains from the sale of aircraft. These increases were offset by non-cash impairment charges of $6.2 million, higher depreciation of $5.4 million and higher adjusted interest expense, maintenance and other costs of $5.6 million.

Aviation Assets

Thus far in 2013, we closed or committed to acquire ten aircraft for more than $450 million. During the first quarter, we closed on the purchase of one 767-300ER subject to a finance lease. Aircraft sales and dispositions totaled $19.8 million which resulted in a net gain on the sale of aircraft of $1.2 million.

As of March 31, 2013, Aircastle owned 158 aircraft having a net book value of $4.7 billion.

Common Dividend and Share Repurchases

On May 1, 2013, Aircastle’s Board of Directors declared a second quarter 2013 cash dividend on its common shares of $0.165 per share, payable on June 14, 2013 to shareholders of record on May 31, 2013.

During the first quarter of 2013, we repurchased 679 thousand of our common shares at an aggregate cost of $8.6 million. Since early 2011 we have repurchased 11.7 million shares at an average cost of $11.87 per share, and have $30 million remaining under the current repurchase authorization.