Willis Lease Finance reported Q2/14 net income was $2.2 million compared to $9.7 million in Q2/13 and $4.3 million in Q1/14. Willis notes that earnings for Q2/13 were positively impacted by a one-time $8.6 million tax benefit related to a reduction in the company’s deferred tax liability and higher than normal earnings from joint ventures due to the recording of $3.4 million of maintenance reserve revenue related to the termination of aircraft leases within the WOLF joint venture.

Total revenue for Q2/14 was $42.3 million up 11.3% from $38.0 million a year earlier. For the first six months, revenue was $85.3 million up 16.4% from $73.3 million for the same period in 2013. Pretax income of $3.55 million and $10.29 million for Q2/14 and H1/14, respectively were up 88.2% ($1.89 million) and 128.4% ($4.50 million)compared to the same year earlier periods.

Charles F. Willis, chairman and CEO said, “In the second quarter, we completed two major projects that will provide significant opportunities for future growth,” Willis continued. “After more than a year of discussions and negotiations, we signed a ground-breaking joint venture agreement with China Aviation Supplies Import & Export Corporation, China’s leader in aviation supplies trade, distribution and logistics. This joint venture called CASC Willis Engine Leasing Company will be the primary leasing vehicle we will use to pursue engine leasing and related services in China in the future. We also successfully renewed and extended our revolving credit facility, upsizing the debt facility by $250 million to $700 million in an offering that was substantially oversubscribed. Three new banks joined the facility and all nine banks in the prior revolver either maintained or increased their commitment levels. We are pleased to be partnering with some of the most prestigious companies in the aviation and banking communities to grow our engine fleet and further expand the services that meet the needs of our airline customers and build value for our shareholders.”

“While new leasing activity continues to be strong, we had an unusually high number of engines come off lease in the latter part of the first quarter, which continued into the first part of the second quarter,” said Donald A. Nunemaker, president. “As a result, utilization was down slightly at the end of the second quarter and lease rent revenues were flat compared to the year ago quarter. Leasing spare engines continues to make economic sense for our customers, and we remain confident that the long-term outlook for our business is strong. In the short-term, however, headwinds created by supply and demand dynamics are contributing to a challenging environment for us.”

At June 30, 2014, Willis Lease had 196 commercial aircraft engines, 5 aircraft parts packages and 4 aircraft and other engine-related equipment in its lease portfolio, with a net book value of $1.017 billion, compared to 194 commercial aircraft engines, 3 aircraft parts packages and 7 aircraft and other engine-related equipment in its lease portfolio, with a net book value of $1.015 billion, a year ago.