Air Lease Q2 Y/Y Earnings Up 20.3% on Record Revenues

Air Lease reported Q2/16 record revenues of $350.1 million, up 14.9% from $304.7 million in Q2/15. Net income was $91.8 million, up 20.6%, with a pre-tax margin of 40.6% for Q2/16 compared to $76.1 million with a pre-tax margin of 38.8% for Q2/15.

The following highlights were excerpted from the Air Lease news release:

  • Flight equipment subject to operating leases, net of depreciation, at June 30, 2016 was $11.7 billion, up 8.3% from $10.8 billion at December 31, 2015.
  • Placed 91% of order book on long-term leases for aircraft delivering through 2018 and 80% through 2019.
  • Purchased $897.4 million in aircraft during the quarter, including 13 aircraft from the company’s order book and three incremental aircraft.
  • Entered into an agreement to sell 25 Embraer E190 and E175 aircraft to Nordic Aviation Capital A/S (NAC) and expects the sale of the aircraft to be completed by Q1/17.
  • As of June 30, 2016, the Air Lease fleet was comprised of 245 owned aircraft, with a weighted-average age and remaining lease term of 3.7 years and 7.0 years, respectively, and 33 managed aircraft. The company’s customer base includes 91 airlines in 53 countries.

“We had another strong quarter, with our business continuing to deliver record revenues and strong results. Our customers continue to perform well. The sale of our ATR and E-jet fleet to NAC is progressing on track. Demand for our used aircraft remains robust. We remain watchful of OEM and airline capacity discipline, and we look forward to any and all opportunities that may arise,” said John L. Plueger, CEO and president.

“Airlines continue to take long term views about traffic flows and fleet modernization. It has always been the case that some airlines have over-ordered and some have under-ordered. We balance this landscape by shifting jets across the global marketplace. Our strong and diverse customer base, best in class fleet of aircraft, and conservative financial structure, will serve us well in an ever evolving marketplace,” said Steven F. Udvar-Házy, executive chairman of the board.

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