Fly Leasing — Investor Presentation (September 2016)
17 slides from Fly Leasing's investor presentation, Sep 14, 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
Conservative FinancingLong tenors, rates hedged 82 aircraft~$3 billion net book value Lower Debt and SG&A CostsRecent financings at very competitive rates Managed by BBAMIndustry leader with nearly 30 year record Significant Insider Ownership13% owned by BBAM shareholders Young Fleet6.2 years averag
Slide 4: Driving Improved Financial Returns
Sold 62 older aircraft since start of 2015 DRIVING IMPROVED FINANCIAL RETURNS Reduced cost of secured debt to <4%, reduced SG&A Invested over $1.1 billion in 18 newer aircraft since start of 2015 Acquired 21% of Fly’s shares at discount of ~30% to net book value since September 2015
Slide 5: Fly's Two Year Fleet Transformation
FLY’s TWO YEAR FLEET transformation Transformed Fleet—Younger, More Profitable Average Fleet Age (years) Average Lease Term (years) August 31, 2016 December 31, 2014 (21%) August 31, 2016 December 31, 2014 26%
Slide 6: Significant Portfolio Improvement
December 31, 2014 August 31, 2016 Aircraft Type # Average Age(years) # Average Age(years) A320 Family 48 9 28 9 A330 / 340 7 5 5 7 B737 Family 57 7 40 7 B747 / 757 / 767 13 17 3 20 B777 / 787 2 1 6 2 Total 127 8 82 6 Significant PORTFOLIO Improvement
Slide 7: Fly's Acquisition Strategy
Principally through sale and leaseback transactionsBBAM’s area of expertise for nearly 30 yearsOpportunistic secondary market purchasesEach transaction can be evaluated prior to commitment Actual aircraft cost, lessee credit, lease termsAvailability and terms of financingAvoids the cyclical risks in
Slide 8: Fly's Acquisition Record
2013 2014 2015 2016 YTD Aircraft Acquired 14 22 10 8 Average Age when Acquired (years) 2 3 2 2 Total Acquisition Costs (in millions) $642 $952 $615 $512 2016 Acquisitions: Eight aircraft, average age of two years$512 million investmentRemaining lease term of 11 years0.88% monthly Lease Rate Factor F
Slide 9: Fly's Disposition Strategy
FLY’s Disposition STRATEGY Sell older aircraft to improve fleet metricsfleet agelease termDispose of out of production aircraft and older modelsBalance lessee credit exposuresAvail of cycles and market conditions to lock in fleet gains
Slide 10: Fly's Aircraft Sales Record
FLY’s Aircraft Sales record Historical Aircraft Sales 2013 2014 2015 1H 2016 Aircraft Sold 10 8 44 16 Average Age (years) 14 13 13 15 Total Gains (in millions) $5.41 $14.81 $29.0 $5.6 1H 2016 Dispositions:16 aircraftAverage age of 15 yearsRemaining lease term of two years As restated.
Slide 11: Fly Share Repurchases
FLY Share repurchases Continuing positive impact on ROE and EPS Repurchased 21% of FLY’s shares since September 2015At a discount of ~30% to net book valueFLY’s net book value per share is $19 at June 30, 2016Returning cash to shareholders through repurchases rather than dividendNew $75 million shar
Slide 12: Major Transformation at Fly
Major Transformation at Fly Sales of older aircraft is beneficial Ample financial resources Investment in newer aircraft Financing strategy assisting returns FLY provides a significant opportunity for increased stakeholder value Improved portfolio metricsGenerating profits and cash ~$900 million of
Slide 13: Appendices
APPENDICES
Slide 14: 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 15: Fly Remarketing Overview
(# of aircraft) FLY took advantage of recent robust market conditions to sell and remarket aircraft, decreasing remarketing exposure Fly remarketing overview Annual Aircraft Remarketing Requirements
Slide 16: Diverse Group of Global Lessees
Lessee Country % of NBV India 12% Ethiopia 11% Philippines 9% UK 4% India 4% India 3% Germany 3% Thailand 3% Chile 3% China 3% Top 10 Lessees 55% Diverse group of global lessees Region % of NBV Asia & South Pacific 45% Europe 26% Middle East & Africa 14% North America 9% Mexico, Central & South Amer
Slide 17: Portfolio Overview
August 31, 2016 Aircraft Type # % of NBV Age(years) A320 Family 28 22% 9 A330 3 8% 5 A340 2 4% 10 B737 Family 40 39% 7 B757 3 1% 20 B777F 2 11% 1 B787 4 15% 2 Total 82 100% 6.2 PORTFOLIO Overview