Fly Leasing — Investor Presentation (September 2016)
16 slides from Fly Leasing's investor presentation, Sep 7, 2016
Slide 1: Fly Leasing
FLY LEASING September 2016 “FLY Leasing
Slide 2: Disclaimer: Forward-Looking Statements
DISCLAIMER Forward-Looking StatementsThis presentation contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by words such as “expects,” “intends,” “anticipates,” “plans,” “believes,” “se
Slide 3: FLY at a Glance
Buying Attractive Aircraft$512 million acquired1; $750 million targeted 76 aircraft: $2.6 Billion Book ValueLeased to 43 airlines in 29 countries Decreasing Debt & SG&A CostsCost of secured debt reduced to ~4% Managed by Industry LeaderBBAM manages 400+ aircraft, established in 1989 Growing Insider
Slide 4: FLY's transformation
FLY’s transformation FY 2011 1H 2016 % Change Fleet Age (years) 8.5 6.8 (20%) Lease Term (years) 3.6 6.3 75% Secured Cost of Debt 5.1% 3.9% (24%) Adjusted SG&A as a % of Total Revenue 9.5% 8.8% (7%) Transformed Fleet—Younger, More Profitable
Slide 5: Drivers of improving ROE
Sold 62 aircraft in 2015 and 2016 to date (13 years average age) Drivers of improving roe Reduced Adjusted SG&A by 28% YoY Reduced cost of secured debt to ~4% at Q2 $512 million pipeline acquired to date (two years average age) New $75 million share repurchase program
Slide 6: Significant Portfolio Improvement
Q4 2014 Q2 2016 Aircraft Type # Age(years) # Age(years) A320 Family 48 9 28 9 A330 / 340 7 5 6 8 B737 Family 57 7 36 7 B717 / 747 / 757 / 767 13 17 3 20 B777 / 787 2 1 3 1 Total 127 8 76 7 Significant PORTFOLIO Improvement
Slide 7: FLY's Acquisition Strategy
$750 million acquisition target$512 million of aircraft acquired to date8 aircraft with an average age ~2 years, remaining lease term ~11 years, and .88% monthly LRF on Purchase PriceAmple liquidity:$900+ million in cash and unencumbered assets to invest in younger aircraftNew $385 million aircraft
Slide 8: FLY's Disposition Strategy
FLY’s Disposition STRATEGY 2016 Aircraft Sales Activity 16 aircraft sold in 1H 2016Average age ~15 years and remaining lease term two years Principally older, less profitableGain of $5.6 Million in 1H 2016Sold or contracted to sell four aircraft in Q3 2016Two have closed so far in Q3Average age of 1
Slide 9: Share repurchases
Share repurchases ACTIONS RESULTS Repurchased 21% of FLY shares since Sept 20151Repurchased 0.7 million shares in Q3 to date1New $75 million share repurchase program Net book value $18.97 per sharePositive impact on ROE and EPSBBAM shareholders own 13% of FLY1Largest insider holding of any public ai
Slide 10: Major Transformation Underway
Major Transformation Underway
Slide 11: Appendices
APPENDICES
Slide 12: Capital Structure
Capital Structure Capital structure & liquidity summary Represents the contractual interest rates and effect of derivative instruments and excludes the amortization of debt discounts and debt issuance costs.In April 2015, FLY re-priced its 2012 Term Loan reducing the margin by 0.75% and the LIBOR fl
Slide 13: Fly remarketing overview
(# of aircraft) FLY took advantage of robust market conditions to sell and remarket aircraft, decreasing remarketing exposure Fly remarketing overview Annual Aircraft Remarketing Requirements
Slide 14: Adjusted SG&A
ADJUSTED SG&A PAGE 13 Restated Sin thousands 2011 1H 2016 Selling, General & Administrative 28,420 15,653 Less: Share-based compensation 4,768 - Professional fees related to restatement * 1,101 Unrealized foreign exchange loss 45 530 Adjusted SG&A 23,607 14,022 Total Revenue 248,789 159,142 9.5% 8.8
Slide 15: Diverse group of global lessees
Lessee Country % of NBV Ethiopia 13% Philippines 11% UK 5% India 5% Germany 4% Thailand 3% Chile 3% China 3% USA 3% Czech Republic 3% Top 10 Lessees 53% Diverse group of global lessees Region % of NBV Asia & South Pacific1 35% Europe 32% Middle East & Africa 16% North America 10% Mexico, Central & S
Slide 16: Portfolio Overview
Q2 2016 Aircraft Type # % of NBV Age(years) A320 Family 28 25% 9 A330 4 10% 6 A340 2 5% 10 B737 Family 36 42% 7 B717 / 757 3 1% 20 B747 / 767 - - - B777F 2 13% <1 B787 1 4% 3 Total 76 100% 6.8 PORTFOLIO Overview