Ftai Aviation Ltd. · NASDAQ:FTAI
Ftai Aviation — Q4 2023 Earnings Presentation
32 slides from Ftai Aviation's earnings presentation, Feb 23, 2024
Slide 1: Power for the Aftermarket
POWER FOR THE AFTERMARKET INNOVATING POWER FTAI Aviation Supplemental Information Fourth Quarter 2023
Slide 2: Disclaimers
Disclaimers IN GENERAL. This disclaimer applies to this document and the verbal or written comments of any person presenting it. This document, taken together with any such verbal or written comments, is referred to herein as the “Presentation.” The information contained on, or accessible through, a
Slide 3: Key Highlights Q4 2023
Key Highlights Q4 2023 Key Business Updates: o Launched V2500 Engine MRE (Maintain, Repair and Exchange) Aerospace Products Offering o Acquired the remaining 50% equity interest in QuickTurn Engine Center o Issued $500 million 2030 Senior Notes at 7.875% coupon o Invested in $229 million of Aviati
Slide 4: Capital Structure
Capital Structure Net Debt / Run-Rate Adj. EBITDA multiple of 3.7x in Q4 2023(1,2) $300 million of Corporate Revolver facility available as of December 31, 2023 FY2024 Net Debt / Adj. EBITDA targeted to be within mid-range of 3x – 4x(3) Capital Structure Overview ($s in millions) Q4 2023 Adj.
Slide 5: Portfolio Concentration on CFM56 & V2500 Platforms
Portfolio Concentration on CFM56 & V2500 Platforms 398 CFM56 Engines in portfolio including Standalone Engines, Engines On-Wing and Engines at The Module FactoryTM o 121x Engines on Airbus A320 and 36x Engines on Boeing 737 (157 CFM56 Engines) o 190 modules at The Module FactoryTM (~63 Aerospace C
Slide 6: QuickTurn – Full Ownership Acquisition
QuickTurn – Full Ownership Acquisition FTAI acquired the remaining 50% of QuickTurn Engine Center on December 01, 2023 $27.8 million purchase price following initial 50% investment of $19.5 million on January 01, 2023 Full control of facility provides greater ability to develop FTAI’s Aerospac
Slide 7: Consolidated Financial Results
Consolidated Financial Results 1 Q4’23 Financial Results 2 Q4’23 Balance Sheet • Net Income attributable to Shareholders of $110.0mm • Total Assets of $3.0b • Adjusted EBITDA of $162.3mm(1) • Total Debt of $2.5b(2) • Adjusted EBITDA growth of 31.4% versus Q4 2022(1) • Total Cash of $90.9mm Consolida
Slide 8: Aviation Leasing
Aviation Leasing Highlights & Key Metrics As of December 31, 2023 Engines Aircraft Total • Acquired 33 Engines & 10 Aircraft during Q4 2023 • $56.2mm Asset Sales for 40% NBV gain of $22.7mm # Assets(2) 267 96 363 Net Leasing Equipment $841.8 $1,026.0 $1,867.8 (9 Engines & 11 Aircraft / Airframes) Re
Slide 9: Aerospace Products
Aerospace Products Highlights & Key Metrics Aerospace Products Margin Q4’22 Q3’23 Q4’23 • Q4’23 Total Revenue growth of 33.5% versus prior quarter ($s in millions) • 61 modules sold in Q4’23 to 17 unique customers (6 new / 11 repeat) $82.8 $118.7 $158.5 Total Revenue • Launched V2500 Maintain, Repai
Slide 10: Corporate & Other
Corporate & Other Highlights & Key Metrics Corporate Debt Corporate & Other is primarily comprised of: ($s in millions) Q3’23 Q4’23 Corporate Revolver $250.0 $0.0 • Debt, unallocated corporate G&A expenses, and management fees Corporate Bonds $2,050.0 $2,550.0 • Offshore energy related vessels and e
Slide 11: 2023 Coverage Ratios
2023 Coverage Ratios • Annual net income attributable to shareholders of $212 million in FY2023 • Generated $516 million in Adj. EBITDA(1) net of Aviation Leasing Gains on Asset Sales • Stable earnings stream to support interest and preferred dividend coverage of 2.4x • Excess cashflows reinvested f
Slide 12: Appendix
Appendix: ▪ Statement of Operations by Segment ▪ Comparative Statements of Operations ▪ Condensed Balance Sheets ▪ Reconciliation of Non-GAAP Measures ▪ Glossary 12
Slide 13: Statement of Operations by Segment
Statement of Operations by Segment 13
Slide 14: Statement of Operations by Segment (unaudited)
Statement of Operations by Segment (unaudited) For the Three Months Ended December 31, 2023 Aerospace Corporate and ($s in thousands) Aviation Leasing Total Products Other Revenues $ 153,802 $ 158,457 $ 478 $ 312,737 Expenses Cost of sales 33,509 101,714 — 135,223 Operating expenses 9,266 7,621 12,0
Slide 15: Statement of Operations by Segment (unaudited)
Statement of Operations by Segment (unaudited) For the Three Months Ended December 31, 2022 Aerospace Corporate and ($s in thousands) Aviation Leasing Total Products Other Revenues $ 186,429 $ 82,829 $ 5,033 $ 274,291 Expenses Cost of sales 75,395 52,851 — 128,246 Operating expenses 9,097 3,873 11,0
Slide 16: Statement of Operations by Segment (unaudited)
Statement of Operations by Segment (unaudited) Year Ended December 31, 2023 Aerospace Corporate and ($s in thousands) Aviation Leasing Total Products Other Revenues $ 681,611 $ 454,970 $ 34,315 $ 1,170,896 Expenses Cost of sales 221,852 280,280 — 502,132 Operating expenses 37,876 20,459 51,828 110,1
Slide 17: Statement of Operations by Segment (unaudited)
Statement of Operations by Segment (unaudited) Year Ended December 31, 2022 Aerospace Corporate and ($s in thousands) Aviation Leasing Total Products Other Revenues $ 502,948 $ 178,515 $ 26,948 $ 708,411 Expenses Cost of sales 138,904 109,481 — 248,385 Operating expenses 81,232 11,967 39,065 132,264
Slide 18: Comparative Statements of Operations
Comparative Statements of Operations 18
Slide 19: Consolidated - Comparative Statements of Operations (unaudited)
Consolidated - Comparative Statements of Operations (unaudited) Three Months Ended ($s in thousands) 12/31/2022 3/31/2023 6/30/2023 9/30/2023 12/31/2023 Revenues Lease Income $ 50,152 $ 55,978 $ 59,541 $ 45,622 46,795 Maintenance revenue 36,675 35,141 42,065 63,925 50,216 Asset sales revenue 99,522
Slide 20: Aviation Leasing - Comparative Statements of Operations (unaudited)
Aviation Leasing - Comparative Statements of Operations (unaudited) Three Months Ended ($s in thousands) 12/31/2022 3/31/2023 6/30/2023 9/30/2023 12/31/2023 Revenues Lease income $ 47,420 $ 48,830 $ 48,167 $ 35,981 $ 46,726 Maintenance revenue 36,675 35,141 42,065 63,925 50,216 Asset sales revenue 9
Slide 21: Aerospace Products - Comparative Statements of Operations (unaudited)
Aerospace Products - Comparative Statements of Operations (unaudited) Three Months Ended ($s in thousands) 12/31/2022 3/31/2023 6/30/2023 9/30/2023 12/31/2023 Revenues Aerospace products revenue $ 82,829 $ 85,113 $ 92,725 $ 118,675 158,457 Total revenues $ 82,829 $ 85,113 $ 92,725 $ 118,675 $ 158,45
Slide 22: Corporate and Other - Comparative Statements of Operations (unaudited)
Corporate and Other - Comparative Statements of Operations (unaudited) Three Months Ended ($s in thousands) 12/31/2022 3/31/2023 6/30/2023 9/30/2023 12/31/2023 Revenues Lease income $ 2,732 $ 7,148 $ 11,374 $ 9,641 $ 69 Other revenue 2,301 1,417 2,865 1,392 409 Total revenues $ 5,033 $ 8,565 $ 14,23
Slide 23: Condensed Balance Sheets
Condensed Balance Sheets Vv = FTAI AVIATION MM 23
Slide 24: Condensed Balance Sheets
Condensed Balance Sheets December 31, ($s in thousands) 2023 2022 Gross Property, Plant and Equipment (PP&E) $ 47,089 $ 10,974 Accumulated Depreciation on PP&E (1,914) (960) Net PP&E $ 45,175 $ 10,014 Gross Leasing Equipment 2,574,394 2,413,230 Accumulated Depreciation on Leasing Equipment (541,981)
Slide 25: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures 25
Slide 26: Adjusted EBITDA Reconciliation by Segment (unaudited)
Adjusted EBITDA Reconciliation by Segment (unaudited) For the Three Months Ended December 31, 2023 Aviation Aerospace Corporate and Total ($s in thousands) Leasing Products Other Net income (loss) attributable to shareholders from continuing operations $ 105,717 $ 80,561 $ (76,253) $ 110,025 Add: (B
Slide 27: Adjusted EBITDA Reconciliation by Segment (unaudited)
Adjusted EBITDA Reconciliation by Segment (unaudited) For the Three Months Ended June 30, 2023 Aviation Aerospace Corporate and Total ($s in thousands) Leasing Products Other Net income (loss) attributable to shareholders from continuing operations $ 72,609 $ 33,257 $ (59,448) $ 46,418 Add: Provisio
Slide 28: Adjusted EBITDA Reconciliation by Segment (unaudited)
Adjusted EBITDA Reconciliation by Segment (unaudited) For the Three Months Ended December 31, 2022 Aviation Aerospace Corporate and Total ($s in thousands) Leasing Products Other Net income (loss) attributable to shareholders from continuing operations $ 53,359 $ 27,660 $ (61,009) $ 20,010 Add: Prov
Slide 29: Adjusted EBITDA Reconciliation by Segment (unaudited)
Adjusted EBITDA Reconciliation by Segment (unaudited) For the Year Ended December 31, 2023 Aviation Aerospace Corporate and ($s in thousands) Total Leasing Products Other Net income (loss) attributable to shareholders from continuing operations $ 291,603 $ 180,177 $ (259,758) $ 212,022 Add: (Benefit
Slide 30: Notes to Non-GAAP Reconciliations - Adjusted EBITDA
Notes to Non-GAAP Reconciliations - Adjusted EBITDA ($s in thousands) (1) Total Includes the following items for the three months ended December 31, 2023 and 2022: (i) depreciation and amortization expense of $46,478 and $37,456, (ii) lease intangible amortization of $3,801 and $3,654 and (iii) amor
Slide 31: Notes to Non-GAAP Reconciliations - Adjusted EBITDA
Notes to Non-GAAP Reconciliations - Adjusted EBITDA ($s in thousands) (2) Total Includes the following items for the three months ended December 31, 2023 and 2022: (i) net income (loss) of $63 and $(244),(ii) depreciation and amortization expense of $286 and $119 and (iii) acquisition and transactio
Slide 32: Glossary
Glossary Adjusted EBITDA The Chief Operating Decision Maker (“CODM”) utilizes Adjusted EBITDA as the key performance measure. Adjusted EBITDA is not a financial measure in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). This performance measure provides the CODM with the