Avolon Reports Q2/2019 Profit of $185MM

International aircraft leasing company Avolon reported a profit of $185 million in the second quarter of 2019.

Other financial highlights included:

  • Lease revenue for the quarter was $678 million
  • Generated $423 million of net cash from operating activities in the quarter
  • Delivered $185 million in profit for the quarter
  • Finance expense impacted by $83 million movement in non-cash gains and charges related to debt facility amendment and refinancing activity
  • At 30 June 2019, Avolon had $16.6 billion future contracted rental cashflows
  • At quarter end, Avolon had US$6.4 billion of available liquidity in unrestricted cash, undrawn revolving credit facilities and undrawn secured and unsecured debt.

Operating highlights from the second quarter of 2019 included:

  • Owned and managed fleet of 530 aircraft, with total orders and commitments for 393 new technology aircraft
  • Executed a total of 24 lease transactions in the quarter comprising new aircraft leases, follow-on leases and lease extensions
  • Delivered a total of 15 new aircraft to 10 customers and transitioned 11 aircraft to follow-on lessees
  • Sold 38 aircraft during the quarter including the sale of 34 regional aircraft
  • Total of 149 airline customers operating in 60 countries.

Strategic highlights from the second quarter of 2019 included:

  • Closing of a private offering by Avolon of $2.5 billion, aggregate principal amount, of senior unsecured notes, upsized from an initial target size of US$1.8 billion due to significant investor demand
  • Corporate credit rating upgraded to investment grade by Fitch, Moody’s and S&P. Credit ratings at quarter end were:
    • Fitch BBB- (Stable Outlook)
    • Moody’s Baa3 (Stable Outlook)
    • S&P BBB- (Stable Outlook)
  • Upsized unsecured revolving credit facility by $488 million bringing the total facility size to over $2.8 billion
  • Repriced senior secured term loan B facility to LIBOR plus 1.75% in conjunction with the repayment of $800 million of the facility
  • Ordered 140 CFM LEAP-1A Engines, to power 70 A320neo family aircraft, valued at $2 billion at list prices announced at 2019 Paris Air Show

Dómhnal Slattery, Avolon CEO, commented, “The second quarter was headlined by our successful achievement of an Investment Grade rating profile – which was delivered well ahead of the expected time frame and affirms our long-held view that we have an Investment Grade quality business.

“We continued our strong financial and trading performance from the previous quarter, delivering total revenues of $682 million, a profit of $185 million and selling 38 aircraft. Our strong cash flow generating capabilities and consistent aircraft trading performance, coupled with our capital raising activities, resulted in Avolon ending the quarter with $6.4 billion of total available liquidity.”

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