Fly Leasing Limited (NYSE: FLY) ("FLY"), a global leader in aircraft leasing, today announced its financial results for the first quarter of 2020.
Highlights
- Net income of $38.1 million, $1.24 per share
- Adjusted Net Income of $43.6 million, $1.42 per share
- Return on equity of 17.2%, Adjusted return on equity of 19.7%
- Sold six aircraft and two engines for a gain of $31.7 million, a 20% premium to book value
- $29.21 book value per share, a 28% increase since March 31, 2019
- Unrestricted cash and cash equivalents of $361.2 million
- $560 million net book value of unencumbered assets
- 2.1x net debt to equity
"The COVID-19 pandemic has caused tremendous distress in the global aviation industry, and FLY remains highly focused on successfully managing through the crisis. FLY is well positioned to face what is certain to be a difficult year," said Colm Barrington, Chief Executive Officer of FLY. "Our high cash balance and low leverage puts us in a strong position to meet our operating and financial commitments in 2020. FLY does not have any orders with the aircraft manufacturers and the company has no near-term refinancing requirements."
"FLY is reporting strong financial results for the first quarter of 2020 and had an unrestricted cash balance of $361 million, and record low leverage of 2.1x at quarter end," said Barrington. "We have grown our book value per share to $29.21, which is a 28% increase from a year ago."
"We sold six aircraft with an average age of over 10 years, as well as two engines from a parted-out aircraft, generating a pre-tax gain of nearly $32 million, which was a 20% premium to book value," added Barrington. "Our aircraft sales again monetized value from our balance sheet, reduced our lessee concentration, generated cash, and further reduced leverage."
Financial Results
FLY is reporting net income of $38.1 million, or $1.24 per share, for the first quarter of 2020. This compares to net income of $45.0 million, or $1.38 per share, for the same period in 2019. The first quarter 2020 results include a $9.4 million unrealized fair value loss related to investments in ABS equity certificates.
Adjusted Net Income
Adjusted Net Income was $43.6 million for the first quarter of 2020, compared to $47.2 million for the same period in the previous year. On a per share basis, Adjusted Net Income was $1.42 in the first quarter of 2020, compared to $1.44 for the first quarter of 2019.
A reconciliation of Adjusted Net Income to net income determined in accordance with GAAP is shown below.
Financial Position
At March 31, 2020, FLY's total assets were $3.6 billion, including investment in flight equipment totaling $3.0 billion. Total cash at March 31, 2020 was $391.7 million, of which $361.2 million was unrestricted. The book value per share at March 31, 2020 was $29.21, a 28% increase since March 31, 2019. At March 31, 2020, FLY's net debt to equity ratio was 2.1x, reduced from 3.4x as of March 31, 2019.
Aircraft Portfolio
At March 31, 2020, FLY had 84 aircraft and seven engines in its portfolio. FLY's aircraft and engines are on lease to 40 airlines in 24 countries. The table below does not include the engines.
At March 31, 2020, the average age of the portfolio, weighted by net book value of each aircraft and engine, was 7.8 years. The average remaining lease term was 5.2 years, also weighted by net book value.