Ftai Aviation Ltd. · NASDAQ:FTAI
Ftai Aviation — Q2 2024 Earnings Presentation
29 slides from Ftai Aviation's earnings presentation, Jul 24, 2024
Slide 1: Power for the Aftermarket
POWER FOR THE AFTERMARKET INNOVATING CFM56 AND V2500 POWER FTAI Aviation Supplemental Information Second Quarter 2024 Leading in Maintenance, Repair and Exchange (MRE) Q2 2024
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 Q2 2024
Key Highlights Q2 2024 Key Business Updates: Three transformational transactions each expected to create significant long-term value(1): o Entered into agreement to purchase Lockheed Martin Commercial Engine Solutions for $170 million o Executed five-year maintenance services agreement for over 10
Slide 4: Acquisition of LMCES Facility
Acquisition of LMCES Facility Entered agreement to acquire Lockheed Martin Commercial Engine Services (LMCES) for $170 million FTAI ideal buyer being the largest customer of LMCES since 2020 as location of the Module Factory Montreal Exceptional opportunity to acquire a world-class MRO will stre
Slide 5: Capital Structure
Capital Structure Net Debt / Run-Rate Adj. EBITDA multiple of 3.4x in Q2 2024(1,2) $400 million of Corporate Revolver facility available as of June 30, 2024 Q4 2024 Net Debt / Run-Rate Adj. EBITDA targeted to be within 3.0x – 3.5x range(3) Capital Structure Overview ($s in millions) Q2 2024 Ad
Slide 6: Portfolio Concentration on CFM56 & V2500 Platforms
Portfolio Concentration on CFM56 & V2500 Platforms 442 CFM56 Engines in portfolio including Standalone Engines, Engines On-Wing and Engines at the Module Factory o 111x Engines on Airbus A320 and 49x Engines on Boeing 737 (160 CFM56 Engines) o 246 modules at the Module Factory (~82 Aerospace CFM56
Slide 7: Consolidated Financial Results
Consolidated Financial Results 1 Q2’24 Financial Results 2 Q2’24 Balance Sheet • Net Loss Attributable to Shareholders of $(228.2)mm • Total Assets of $3.4b • Net Income excluding Internalization Fee of $71.8mm • Total Debt of $3.1b(2) • Adjusted EBITDA of $213.9mm(1) • Total Cash of $169.6mm Consol
Slide 8: Aviation Leasing
Aviation Leasing Highlights & Key Metrics As of June 30, 2024 Engines Aircraft Total • Acquired 25 Engines & 7 Aircraft during Q2 2024 • $72.4mm Asset Sales for 19% NBV gain of $13.5mm # Assets(1) 292 99 391 Net Leasing Equipment $946.2 $1,086.0 $2,032.2 (8 Engines & 15 Aircraft / Airframes) Remaini
Slide 9: Aerospace Products
Aerospace Products Highlights & Key Metrics Aerospace Products Margin Q2’23 Q1’24 Q2’24 • Q2’24 Total Revenue growth of 164.5% versus Q2 2023 ($s in millions) • 82 modules sold in Q2 2024 Total Revenue $92.7 $189.1 $245.2 • Consistently generating Adj. EBITDA margins of between 30% - 40% Adj. EBITDA
Slide 10: Corporate & Other
Corporate & Other Highlights & Key Metrics Corporate Debt Corporate & Other is primarily comprised of: ($s in millions) Q1’24 Q2’24 Corporate Revolver $175.0 $0.0 • Debt, unallocated corporate G&A expenses, and management fees Corporate Bonds $2,550.0 $3,130.9 • Offshore energy related vessels and e
Slide 11: Q2 2024 Coverage Ratios
Q2 2024 Coverage Ratios • Net Loss Attributable to Shareholders of $228 million in Q2 2024: o Net Income of $72 million excluding one-time Internalization Fee to Fortress • Generated $200 million in Adj. EBITDA(1) net of Aviation Leasing Gains on Asset Sales • Stable earnings stream to support inter
Slide 12: Appendix
Appendix: ▪ Statement of Operations by Segment ▪ Comparative Statements of Operations ▪ Condensed Balance Sheets ▪ Reconciliation of Non-GAAP Measures ▪ Glossary 12
Slide 13: Statement of Operations by Segment
Statement of Operations by Segment 13
Slide 14: Statement of Operations by Segment (unaudited) - Q2 2024
Statement of Operations by Segment (unaudited) For the Three Months Ended June 30, 2024 Aerospace Corporate and ($s in thousands) Aviation Leasing Total Products Other Revenues $ 184,437 $ 245,200 $ 13,957 $ 443,594 Expenses Cost of sales 58,969 146,888 — 205,857 Operating expenses 8,782 6,423 13,89
Slide 15: Statement of Operations by Segment (unaudited) - Q2 2023
Statement of Operations by Segment (unaudited) For the Three Months Ended June 30, 2023 Aerospace Corporate and ($s in thousands) Aviation Leasing Total Products Other Revenues $ 167,381 $ 92,725 $ 14,239 $ 274,345 Expenses Cost of sales 49,598 54,934 — 104,532 Operating expenses 7,578 3,236 13,983
Slide 16: Statement of Operations by Segment (unaudited) - Six Months 2024
Statement of Operations by Segment (unaudited) For the Six Months Ended June 30, 2024 Aerospace Corporate and ($s in thousands) Aviation Leasing Total Products Other Revenues $ 319,747 $ 434,257 $ 16,284 $ 770,288 Expenses Cost of sales 90,858 257,803 — 348,661 Operating expenses 16,989 13,893 23,53
Slide 17: Statement of Operations by Segment (unaudited) - Six Months 2023
Statement of Operations by Segment (unaudited) For the Six Months Ended June 30, 2023 Aerospace Corporate and ($s in thousands) Aviation Leasing Total Products Other Revenues $ 366,421 $ 177,838 $ 22,804 $ 567,063 Expenses Cost of sales 141,832 108,370 — 250,202 Operating expenses 14,666 6,891 25,77
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) 6/30/2023 9/30/2023 12/31/2023 3/31/2024 6/30/2024 Revenues Lease Income $ 59,541 $ 45,622 $ 46,795 $ 53,161 $ 70,754 Maintenance revenue 42,065 63,925 50,216 45,790 51,187 Asset sales revenue 76,836
Slide 20: Aviation Leasing - Comparative Statements of Operations (unaudited)
Aviation Leasing - Comparative Statements of Operations (unaudited) Three Months Ended ($s in thousands) 6/30/2023 9/30/2023 12/31/2023 3/31/2024 6/30/2024 Revenues Lease income $ 48,167 $ 35,981 $ 46,726 $ 50,846 $ 60,759 Maintenance revenue 42,065 63,925 50,216 45,790 51,187 Asset sales revenue 76
Slide 21: Aerospace Products - Comparative Statements of Operations (unaudited)
Aerospace Products - Comparative Statements of Operations (unaudited) Three Months Ended ($s in thousands) 6/30/2023 9/30/2023 12/31/2023 3/31/2024 6/30/2024 Revenues Aerospace products revenue $ 92,725 $ 118,675 $ 158,457 $ 189,057 245,200 Total revenues $ 92,725 $ 118,675 $ 158,457 $ 189,057 $ 245
Slide 22: Corporate and Other - Comparative Statements of Operations (unaudited)
Corporate and Other - Comparative Statements of Operations (unaudited) Three Months Ended ($s in thousands) 6/30/2023 9/30/2023 12/31/2023 3/31/2024 6/30/2024 Revenues Lease income $ 11,374 $ 9,641 $ 69 $ 2,315 $ 9,995 Other revenue 2,865 1,392 409 12 3,962 Total revenues $ 14,239 $ 11,033 $ 478 $ 2
Slide 23: Condensed Balance Sheets
Condensed Balance Sheets Vv = FTAI AVIATION MM 23
Slide 24: Condensed Balance Sheets (unaudited)
Condensed Balance Sheets (unaudited) ($s in thousands) June 30, 2024 December 31, 2023 Gross Property, Plant and Equipment (PP&E) $ 36,774 $ 47,089 Accumulated Depreciation on PP&E (3,696) (1,914) Net PP&E $ 33,078 $ 45,175 Gross Leasing Equipment 2,802,983 2,574,394 Accumulated Depreciation on Leas
Slide 25: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures 25
Slide 26: Adjusted EBITDA Reconciliation by Segment (unaudited) - Q2 2024
Adjusted EBITDA Reconciliation by Segment (unaudited) For the Three Months Ended June 30, 2024 Aviation Aerospace Corporate and Total ($s in thousands) Leasing Products Other Net income (loss) attributable to shareholders from continuing operations $ 52,780 $ 84,875 $ (365,860) $ (228,205) Add: Prov
Slide 27: Adjusted EBITDA Reconciliation by Segment (unaudited) - Six Months 2024
Adjusted EBITDA Reconciliation by Segment (unaudited) For the Six Months Ended June 30, 2024 Aviation Aerospace Corporate and Total ($s in thousands) Leasing Products Other Net income (loss) attributable to shareholders from continuing operations $ 95,377 $ 151,308 $ (443,603) $ (196,918) Add: Provi
Slide 28: 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 June 30, 2024 and 2023: (i) depreciation and amortization expense of $56,691 and $38,514, (ii) lease intangible amortization of $3,786 and $3,616 and (iii) amortiza
Slide 29: 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