Aercap Holdings N.v. · NYSE:AER
Aercap — Q4 2014 Earnings Presentation
29 slides from Aercap's earnings presentation, Feb 23, 2015
Slide 1: Fourth Quarter 2014 Financial Results
February 23, 2015 Fourth Quarter 2014 Financial Results AerCap Holdings N.V.
Slide 2: Disclaimer Incl. Forward Looking Statements & Safe Harbor
Disclaimer Incl. Forward Looking Statements & Safe Harbor This presentation contains certain statements, estimates and forecasts with respect to future performance and events. These statements, estimates and forecasts are “forward-looking statements”. In some cases, forward- looking statements can b
Slide 3: 4th Quarter and Full Year 2014 Highlights
4th Quarter and Full Year 2014 Highlights • Adjusted net income1 was $296.7 million for 4Q 2014 (reported net income of $298.2 million), and $855.5 million for FY 2014 (reported net income of $810.4 million) • Adjusted basic earnings1 per share were $1.40 for 4Q 2014 (reported basic earnings per sha
Slide 4: Operational Update
Operational Update • Key targets relating to the acquisition of ILFC have been met or exceeded: • transfer of aircraft to Ireland has been completed • de-leveraging plan has been accelerated • annualized earnings of $1.0 billion have been reached • relocation of personnel has been completed and real
Slide 5: Share Repurchase Program
Share Repurchase Program • AerCap will initiate a new share repurchase program • The new share repurchase program will run through December 31, 2015 and will allow total repurchases of up to $250.0 million in 2015 • Repurchases under the program may be made through open market purchases or privately
Slide 6: Net Income
Net Income ($ millions) 4Q 2014 4Q 2013 FY 2014 FY 2013 Reported Net Income 298.2 65.6 810.4 292.4 Adjusted for: • Mark-to-market on interest rate caps and swaps, 4.2 (1.9) 14.6 (10.2) net of tax • Transaction and integration related expenses, net of 10.4 9.1 130.2 9.6 tax1 • Maintenance rights rela
Slide 7: Basic Earnings Per Share
Basic Earnings Per Share 4Q 2014 4Q 2013 FY 2014 FY 2013 Earnings Per Share $1.41 $0.58 $4.61 $2.58 Adjusted for: Mark-to-market on interest rate caps and swaps, transaction and integration related expenses1 and $(0.01) $0.06 $0.25 $(0.01) maintenance rights related expenses Adjusted Earnings Per Sh
Slide 8: Revenues and Other Income
Revenues and Other Income ($ millions) 4Q 2014 4Q 2013 FY 2014 FY 2013 Basic Lease Rents1 1,159.0 234.9 3,282.8 901.6 Maintenance Rents and Other Receipts2 124.1 26.6 215.5 74.5 Net Gain on Sale of Assets 25.8 9.6 37.5 41.9 Other Income3 28.0 6.7 104.5 32.1 Total Revenues and Other Income 1,336.9 27
Slide 9: Net Interest Margin (Net Spread)
Net Interest Margin (Net Spread) ($ millions) 4Q 2014 4Q 2013 FY 2014 FY 2013 Net Interest Margin (Net Spread)1 883.5 175.7 2,519.2 663.6 Average Lease Assets2 36,066.2 8,058.1 25,907.2 7,750.2 Annualized Net Spread % 9.8% 8.7% 9.7% 8.6% (1) Net Interest Margin (Net Spread) is basic lease rents less
Slide 10: Sales of Aircraft
Sales of Aircraft ($ millions) 4Q 2014 4Q 2013 FY 2014 FY 2013 Pre-tax Gain from Aircraft Sales 25.8 9.6 37.5 41.9 4Q Activity • The gain from aircraft sales related to nine aircraft from our owned portfolio (one Airbus A340-300, two Airbus A340-600s, one Boeing 737 classic, one Boeing 747, one Boei
Slide 11: Other Expenses and Taxes
Other Expenses and Taxes ($ millions) 4Q 2014 4Q 2013 FY 2014 FY 2013 Leasing1 119.1 17.7 190.3 48.5 SG&A 117.5 21.9 299.9 89.1 Impairment2 20.0 14.3 21.8 26.2 Transaction and Integration Related3 11.9 10.4 148.8 11.0 FY 2014 FY 2013 Blended Tax Rate4 15.0% 8.4% (1) Leasing includes $57.4 million re
Slide 12: Russian Net Exposure
Russian Net Exposure Net Aircraft ($ billions) Exposure 1 Value 2 Aeroflot Group & S7 Group 1.2 1.4 Others (10 airlines) 1.0 1.4 Total 2.2 2.8 • AerCap holds ~$0.7 billion of maintenance reserves, security deposits, and letters of credit on aircraft leased to Russian carriers • Nine aircraft were te
Slide 13: Cash
Cash ($ millions) FY 2014 FY 2013 Cash and Cash Equivalents at December 31, 2014 1,490.4 295.5 (Excl. Restricted Cash) Total Cash Balance at December 31, 2014 2,207.8 568.3 (Incl. Restricted Cash) Operating Cash Flow for the Full Year 2,325.2 692.7 Operating Cash Flow for the Fourth Quarter 845.9 18
Slide 14: Liquidity Position as of December 31, 2014
Liquidity Position as of December 31, 2014 Sources (for 12 Months to December 31, 2015) ($ billions) Unsecured Revolver 3.0 Other Undrawn Commitments 1.8 Sources do not include or assume additional AIG Revolver 1.0 financing for deliveries Unrestricted Cash 1.5 of new aircraft Total Available Liquid
Slide 15: Capital Structure
Capital Structure 4Q 2014 4Q 2013 Total Debt at Quarter-End ($ millions) 30,402.4 6,236.9 Average Cost of Debt (Including all fees)1 3.6% 3.9% Equity ($ millions) 7,942.5 2,429.2 Debt / Equity Ratio 3.4 to 1 2.6 to 1 Debt / equity ratio calculation: • The debt/equity ratio for 4Q 2014 is calculated
Slide 16: Financial Outlook
6 AERCAP Aviation Solutions 4 *% tet AERCAP.COM
Slide 17: Financial Outlook for 2015 – Adjusted Basis
Financial Outlook for 2015 – Adjusted Basis Anticipated drivers for AerCap’s 2015 financial performance, subject to change, in light of highly fluid market conditions and other factors1 ~5.0-5.1 ~13.5 ~1.25 ~1.05-1.1 billion percent billion billion TOTAL TAX RATE PRE-TAX NET INCOME REVENUE EARNINGS
Slide 18: Rapid Deleveraging
Rapid Deleveraging AerCap’s estimated capital structure (debt/equity ratios) beyond 2014, subject to change, in light of highly fluid market conditions and other factors1 • Targeted debt/equity2 range: • Debt/equity remains flat beyond ~2.7x - 3.0x (AerCap’s leverage prior 2016 as it is assumed exce
Slide 19: Excess Capital
Excess Capital AerCap’s estimated capital structure and the amount of excess capital expected to be generated beyond 2014, subject to change, in light of highly fluid market conditions and other factors1 ($ millions) 2015 2016 2017 Excess Capital available for use while still achieving ~250.0 ~500.0
Slide 20: Use of Excess Capital and Outlook
Use of Excess Capital and Outlook A combination of additional aircraft purchases and return of capital is expected EXCESS CAPITAL OF ~$1.3 billion 2015 THROUGH 2017 IF USED FOR AIRCRAFT PURCHASES IF USED FOR SHARE REPURCHASES AIRCRAFT LEASE ASSETS CAGR 9% NUMBER OF SHARES THAT CAN BE 2015 THROUGH 20
Slide 21: Financial Outlook for 2015 – Reported Basis
Financial Outlook for 2015 – Reported Basis Anticipated drivers for AerCap’s 2015 financial performance, subject to change, in light of highly fluid market conditions and other factors1 ($ billions) Adjusted Income Adjustment Reported Income2 Total Revenue ~5.0-5.10 - ~5.0-5.10 Depreciation ~(2.10)
Slide 22: Aviation Solutions
Aviation Solutions AERCAP , AERCAP.COM
Slide 23: Supplemental Information
Supplemental Information 3 23 4
Slide 24: Aircraft Transactions – Full Year 2014
Aircraft Transactions – Full Year 2014 249 33 83 LEASE AIRCRAFT AIRCRAFT AGREEMENTS PURCHASED DISPOSED EXECUTED (sale or part-out) 64 from our owned portfolio and 19 from our managed portfolio In addition to the aircraft transactions above, 81 aircraft were delivered to lessees during 2014 3 24 4
Slide 25: High Quality and Well-Diversified Portfolio
High Quality and Well-Diversified Portfolio Number of Number of Owned Aircraft Type % Net Book Value Managed & Aircraft on Order2 Total Aircraft Aircraft1 AerDragon Aircraft Airbus A319 143 8% 11 154 Airbus A320 241 16% 33 274 Airbus A320neo 155 155 Airbus A321 98 7% 15 4 117 Airbus A321neo 50 50 Ai
Slide 26: Forward Orders and Purchase/Leasebacks
Forward Orders and Purchase/Leasebacks ($ billions) 2015 2016 2017 2018 2019 Thereafter Total1 Airbus A320 / A321neo & A350 0.3 2.6 4.0 3.2 2.2 3.3 15.6 Airbus A321 0.2 0.2 Airbus A330 0.1 0.1 Boeing 787-8/-9 1.9 1.9 1.9 2.5 0.7 8.9 Boeing 737NG 1.1 1.1 Embraer E190 / 195-E2 0.2 0.6 1.3 2.1 3.6 4.5
Slide 27: Portfolio Management Metrics for Owned Aircraft
Portfolio Management Metrics for Owned Aircraft Lease Portfolio FY 2014 FY 2013 Utilization Rate1 99.2% 99.5% Portfolio Yield2 13.5% 12.6% Average Lease Term (Previous 12 months) • Leases for New Aircraft (Months) 1443 163 • Leases for Used Aircraft (Months) 544 57 (1) Utilization rate weighted by b
Slide 28: Leasing Expenses
Leasing Expenses ($ millions) 4Q 20141 4Q 2013 FY 20141 FY 2013 Default and Restructuring Related 38.4 12.3 47.3 15.5 Normal Transition Costs 11.2 2.6 35.8 16.4 Maintenance Rights Expense 57.4 - 69.8 - Lessor Maintenance Contributions 6.7 0.1 24.5 10.8 Other Leasing Costs 5.4 2.7 12.9 5.8 Leasing Ex
Slide 29: Head Office, Schiphol, The Netherlands
Head Office, AerCap House Stationsplein 965 1117 CE Schiphol, The Netherlands +31 20 655 9655 contact@aercap.com 3 29 4