Aercap Holdings N.v. · NYSE:AER
Aercap — Q4 2011 Earnings Presentation
27 slides from Aercap's earnings presentation, Feb 22, 2012
Slide 1: AerCap Holdings N.V. Fourth Quarter 2011 Earnings Call
AerCap Holdings N.V. Fourth Quarter 2011 Earnings Call February 22, 2012
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 be
Slide 3: Fourth Quarter 2011 Financial Highlights
Fourth Quarter 2011 Financial Highlights Adjusted net income was $79.8 million for Fourth Quarter 2011, exclusive of the impact relating to the mark-to-market of interest rate caps, share-based compensation, and discontinued operations, an increase of 42% over Fourth Quarter 2010. Adjusted earnings
Slide 4: Full Year 2011 Financial Highlights
Full Year 2011 Financial Highlights Adjusted net income was $303.1 million for 2011, exclusive of the impact relating to the mark-to-market of interest rate caps, share-based compensation, discontinued operations, and the buy-out of the Genesis portfolio servicing rights, an increase of 35% over 201
Slide 5: Update on American Airlines Purchase-Leaseback
Update on American Airlines Purchase-Leaseback American Airlines parent AMR filed for Chapter 11 bankruptcy on November 29, 2011. The recent purchase/leaseback deal was structured so that the remaining undelivered aircraft obligation automatically terminated when American filed for bankruptcy. AerCa
Slide 6: Net Income
Net Income ($ Million) 4Q 2010 4Q 2011 FY 2010 FY 2011 Reported Net Income 72.4 76.4 207.6 172.2 Adjusted for: (Gain)/Loss from mark- (17.5) 3.4 13.5 51.3 to-market on interest rate caps * Adjusted for: cost of share-based 1.4 1.3 2.8 5.4 compensation* Adjusted for: one-time items relating - (1.3) -
Slide 7: Earnings Per Share
Earnings Per Share 4Q 2010 4Q 2011 FY 2010 FY 2011 Earnings Per Share $0.53 $0.54 $1.81 $1.17 Adjusted for: mark-to-market on interest rate caps, share based compensation, one-time charges (0.12) 0.03 0.14 0.90 relating to discontinued operations & buy-out of the Genesis portfolio servicing rights A
Slide 8: Total Revenue
Total Revenue ($ Million) 4Q 2010 4Q 2011 FY 2010 FY 2011 Basic Lease Rents 235.3 237.2 840.4 951.3 Maintenance/End-of- 19.2 26.0 61.9 99.2 Lease Revenue Management Fees and 4.6 5.1 16.9 21.8 Interest Income Other Revenue* - 8.0 3.9 12.4 Net Gain / (Loss) on Sales (0.2) 0.1 36.2 9.3 Total Revenue 25
Slide 9: Net Interest Margin (Net Spread) - Fourth Quarter 2011
Net Interest Margin (Net Spread) - Fourth Quarter 2011 ($ Millions) 4Q 2010 4Q 2011 % Change Basic Lease Rents 235.3 237.2 1% Less: Interest Expense* (56.4) (58.9) 4% Net Interest Margin (Net Spread) 178.9 178.3 0% Average Lease Assets 7,755 7,955 3% Annualized Margin (% Lease Assets)** 9.23% 8.97%
Slide 10: Net Interest Margin (Net Spread) – FY 2011
Net Interest Margin (Net Spread) – FY 2011 ($ Millions) 2010 2011 % Change Basic Lease Rents 840.4 951.3 13% Less: Interest Expense* (206.7) (233.2) 13% Net Interest Margin (Net Spread) 633.7 718.1 13% Average Lease Assets 6,886 7,939 15% Annualized Margin (% Lease Assets)** 9.20% 9.05% * Excludes n
Slide 11: Sales
Sales ($ Million) 4Q 2010 4Q 2011 FY 2010 FY 2011 Gain from Sales (0.2) 0.1 36.2* 9.3** * 2010 sales include 2 forward positions, forward sales of 4 new A330s, 6 new A320s, 2 older B757s & 1 older B767. ** 2011 sales includes the sales of 18 older aircraft (3 A320s, 1 A330s, 6 B737s & 3 B757s & 5 MD
Slide 12: Leasing Expenses and SG&A
Leasing Expenses and SG&A ($ Million) 4Q 2010 4Q 2011 FY 2010 FY 2011 Operating lease in costs 3.1 3.0 12.3 12.1 Leasing expenses * 22.8 15.2 55.5 58.4 SG&A** 23.4 22.5 80.6 120.7 Total Leasing Expenses 49.3 40.7 148.4 191.2 and SG&A * Details on slide 12 ** Details on slide 13 12
Slide 13: Leasing Expenses
Leasing Expenses ($ Million) 4Q 2010 4Q 2011 FY 2010 FY 2011 Default & Restructuring 6.3 5.5 9.8 30.7 Related Normal Transition Costs 2.5 1.4 13.9 9.1 Lessor Maintenance 8.7 6.2 21.5 10.2 Contributions Other Leasing Costs 5.3 2.1 10.3 8.4 Total Leasing Expenses 22.8 15.2 55.5 58.4 13
Slide 14: SG&A
SG&A ($ Million) 4Q 2010 4Q 2011 FY 2010 FY 2011 Aircraft Management Fees* 1.8 0.1 6.4 26.8 Mark-to-market of: foreign currency hedges, foreign (0.3) (1.1) (1.7) 2.8 currency cash balances, and other derivatives Share-based compensation 1.1 1.5 2.9 6.2 expenses Other Selling, General and 20.8 22.0 7
Slide 15: Impact from Defaults & Restructurings
Impact from Defaults & Restructurings ($ Million) FY 2010 FY 2011 FY 2012 (Actual) (Actual) (Estimate)* Default and Restructuring Related Lost Basic Lease Rents (Net of (4.4) (5.4) - Security Deposits) Maintenance Rents Held 29.3 63.9 - Leasing Expenses (9.8) (30.7) ~(12) Impairment Charges (10.9) (
Slide 16: Tax Rate
Tax Rate FY 2010 FY 2011 Blended Tax Rate* 8.6% Charge 6.7% Charge * The blended effective tax rate in any year is impacted by the source and amount of earnings among AerCap’s different tax jurisdictions. 16
Slide 17: Total Assets and Number of Aircraft/Engines
Total Assets and Number of Aircraft/Engines 2010 2011 ($ Millions) 9,601 10,000 9,108 8,000 5% decrease Total Assets Owned and on 6,000 over 4Q 2010 (Driven by the sales of Balance Sheet AeroTurbine & 50% interest in an A330 JV) 4,000 2,000 0 The increase of 11 aircraft is driven by the Number of Ai
Slide 18: Committed Aircraft Purchases
Committed Aircraft Purchases ($ Million) FY 2011 Committed 2012* Aircraft Purchases 894 986 Number of Aircraft 13 17 Purchases (Units) • Includes purchases of 11 aircraft as part of the American Airlines Purchase-Leaseback transaction which are subject to confirmation on an aircraft by aircraft basi
Slide 19: Portfolio Management Metrics Owned Aircraft
Portfolio Management Metrics Owned Aircraft Lease Portfolio FY 2010 FY 2011 Utilization Rate 98.3% 98.4% Portfolio Yield* 13.1% 13.2% Average Term (Months) – New Leases for New Aircraft 138 **137 – New Leases for Used Aircraft 62 *** 74 * Lease revenue divided by average book value of flight equipme
Slide 20: Cash
Cash ($ Millions) 2011 Cash and Cash Equivalents at December 31, 2011 411.1 Total Cash Balance at December 31, 2011 648.4 (Incl. Restricted Cash) Operating Cash Flow for FY 2011 621.6 20
Slide 21: Debt and Equity
Debt and Equity ($ Millions) 4Q 2010 4Q 2011 Total Debt at Quarter-End 6,566 6,111 Average Cost of Debt (including 3.4% 3.8% amortization of debt issuance costs)* Average Cost of Debt (excluding 3.0% 3.3% amortization of debt issuance costs)* Equity 2,217 2,283 Debt / Equity Ratio 3.0 to 1 2.7 to 1
Slide 22: 2012 Current Outlook – EPS Impact of Aircraft Sales / One-offs
2012 Current Outlook – EPS Impact of Aircraft Sales / One-offs FY 2011 FY 2012 Committed Aircraft Sales $0.06 $0.00 Other One-offs $0.04 $0.00 EPS Impact $0.10 $0.00 22
Slide 23: Net Maintenance Contribution
Net Maintenance Contribution Full Year Full Year 2010 Full Year 2011 2012 Estimate * Default & Restructuring 29.3 63.9 - Related Maintenance Rents Regular Maintenance Rents 32.6 35.3 ~35 Leasing Expenses (55.5) (58.4) ~(60) Pre-tax Impact 6.4 40.8 ~(25) EPS Impact (after tax) $0.05 $0.24 ~($0.16) *
Slide 24: 2012 Financial Outlook
2012 Financial Outlook AerCap expects to grow EPS based on the committed aircraft purchases and the recently completed share repurchase program despite the continued uncertainties of the global economic environment. Set forth below are the anticipated drivers for AerCap’s 2012 financial performance,
Slide 25: Appendix
Appendix * (AERCAP 25
Slide 26: Aircraft and Engine Transactions FY 2011
Aircraft and Engine Transactions FY 2011 31 aircraft lease agreements & letters-of-intent executed 30 aircraft delivered to lessees 13 aircraft purchased 18 aircraft sold from our owned and 8 from managed portfolios, in addition: ― three A330s were sold through the sale of a 50% interest in a joint
Slide 27: High Quality and Well-Diversified Portfolio
High Quality and Well-Diversified Portfolio Aircraft Portfolio as of December 31, 2011 Aircraft under Sale Number Number of / Purchase of Owned % Net Book Managed Aircraft on Contract or Total Aircraft Value Aircraft Order LOI Aircraft Airbus A300 Freighter 1 0.3% 0 0 0 1 73% narrow body – “Work Air