Aircastle Reports Financial Results for the Three-Month Period Ended November 30, 2020
Key Financial Metrics for the Three Months ended November 30, 2020
- Total revenues of $180.9 million
- Net income of $2.7 million
- Adjusted EBITDA(1) of $167.5 million
- Gain on sale of flight equipment of $13.0 million
Recent Highlights
- For the nine months ended November 30, 2020, acquired five aircraft for $154.3 million, two of which were A320neo aircraft acquired in a sale leaseback transaction with Volaris
- For the nine months ended November 30, 2020, sold six aircraft; average age of approximately eleven years; nine-month gain on sale of $24.2 million; through January 8, 2021, sold four additional aircraft
- For the three months ended November 30, 2020, collections represented approximately 90% of lease rental and direct financing and sales-type lease revenues
- In September, Moody's affirmed Aircastle's senior unsecured debt rating at Baa3
Liquidity
- As of December 31, 2020, total liquidity of $2.2 billion includes $1.25 billion of undrawn credit facilities, $463 millionof unrestricted cash, $153 million of contracted asset sales, and $343 million of projected operating cash flows through December 31, 2021
- 224 unencumbered aircraft with a net book value of $5.4 billion
- $753 million of total adjusted contractual commitments through December 31, 2021; includes $500 million of notes due in March 2021
(1) | Refer to the selected financial information accompanying this press release for a reconciliation of GAAP to Non-GAAP numbers. |
Mike Inglese, Aircastle's Chief Executive Officer, commented, "Although 2020 has proven to be a very challenging environment for the aviation industry, we remain optimistic about the recovery of the global airline industry over the long term. As vaccines become more widely available during 2021, we expect passengers to return, and aircraft leasing will play a critical role in the industry's recovery over the next few years. With the strong, long-term shareholder support of Marubeni Corporation and Mizuho Leasing, along with our experienced management team, Aircastle is well positioned to grow in a disciplined and profitable manner over the long run."
Aviation Assets
As of November 30, 2020, Aircastle owned 260 aircraft and other flight equipment having a net book value of $7.0 billion. We also manage nine aircraft with a net book value of $315 million dollars on behalf of our joint venture with Mizuho Leasing.
Owned Aircraft | As of | As of | |||||
Net Book Value of Flight Equipment ($ mils.) | $ | 6,979 | $ | 7,717 | |||
Net Book Value of Unencumbered Flight Equipment ($ mils.) | $ | 5,406 | $ | 5,900 | |||
Number of Aircraft | 260 | 270 | |||||
Number of Unencumbered Aircraft | 224 | 229 | |||||
Number of Lessees | 80 | 85 | |||||
Number of Countries | 45 | 48 | |||||
Weighted Average Fleet Age (years)(2) | 10.5 | 9.9 | |||||
Weighted Average Remaining Lease Term (years)(2) | 4.3 | 4.8 | |||||
Weighted Average Fleet Utilization for the quarter ended(3) | 94.0 | % | 99.3 | % | |||
Managed Aircraft on behalf of Joint Ventures | |||||||
Net Book Value of Flight Equipment ($ mils.) | $ | 315 | $ | 329 | |||
Number of Aircraft | 9 | 9 | |||||
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(1) | Calculated using net book value of flight equipment held for lease and net investment in leases at period end. |
(2) | Weighted by net book value. |
(3) | Aircraft on-lease days as a percent of total days in period weighted by net book value. The decrease from our historical utilization rate was primarily due to the early termination of leases. |
Deferrals
In the current environment airlines have sought support from their lessor partners. These requests have generally come in the form of payment deferrals and lease restructurings. As of January 8, 2021, seven of our airline customers are subject to judicial insolvency proceedings or similar protection. We lease 22 aircraft to these customers, which comprise 13% of our net book value of flight equipment and 11% of our reported lease rental and direct financing and sales-type lease revenues for the trailing twelve months ended November 30, 2020. While we anticipate that there may be additional airline bankruptcies and liquidations during the winter, we remain confident that the major US and global carriers, as well as the largest low-cost carriers, have the means to survive the COVID-19 crisis.
We continue to grant deferrals to help certain clients manage through the crisis. As of January 8, 2021, we had executed documents or had approved deferral arrangements with 37 airlines representing approximately 46% of our customer base. The amount currently deferred is $101 million, including $76 million that appears in our November 30, 2020Consolidated Balance Sheet. This represented approximately 15% of our reported lease rental and direct financing and sales-type lease revenues for the trailing twelve months ended November 30, 2020.
New Fiscal Year End
Aircastle previously announced that we changed our fiscal year end to the twelve-month period ending on the last day in February, beginning February 28, 2021. This change better aligns our financial reporting with the financial reporting cycle of our shareholders, Marubeni Corporation and Mizuho Leasing Company, Limited.
Conference Call
In connection with this press release, management will host a conference call on Thursday, January 14, 2021, at 9:00 A.M. Eastern Time. All interested parties are welcome to participate on the live call. The conference call can be accessed by dialing (800) 430-8332 (from within the U.S. and Canada) or (786) 204-3966 (from outside of the U.S. and Canada) ten minutes prior to the scheduled start and referencing the passcode "8160028".
A simultaneous webcast of the conference call will be available to the public on a listen-only basis at www.aircastle.com. Please allow extra time prior to the call to visit the site and download the necessary software required to listen to the internet broadcast.
For those who are not available to listen to the live call, a replay will be available until 12:00 P.M. Eastern Time on Saturday, February 13, 2021, by dialing (888) 203-1112 (from within the U.S. and Canada) or (719) 457-0820 (from outside of the U.S. and Canada); please reference passcode "8160028".