Avolon Holdings Ltd

Avolon — Q2 2015 Earnings Presentation

18 slides from Avolon's earnings presentation, Aug 5, 2015

  1. Slide 1: 2015 Second Quarter Earnings Presentation

    AVOLON 2015 Second Quarter | Earnings Presentation August 5, 2015

  2. Slide 2: Disclaimer Concerning Forward-Looking Statements and Non-GAAP Information

    Disclaimer Concerning Forward-Looking Statements and Non-GAAP Information AVOLON This document includes forward-looking statements, beliefs or opinions, including statements with respect to Avolon’s business, financial condition, results of operations and plans. These forward-looking statements invo

  3. Slide 3: Five Essential Pillars for Success

    Five Essential Pillars for Success AVOLON 1 Minimum scale requirement of $10bn – Delivered and Committed Fleet Top 10 lessors account for almost 60% of delivered and committed fleet on operating lease 2 Multi-cycle management experience Founded & scaled two leading global lessors with a core focus o

  4. Slide 4: Strong Growth and Disciplined Risk Management Q2 2015

    Strong Growth and Disciplined Risk Management Q2 2015 AVOLON STRONG GROWTH $ millions Adjusted Net Income1 Net Income Commitments Cost of Funds Q2 2014 34 24 4,274 4.10% Q2 2015 62 56 6,888 3.54% Change +83% +133% +61% -56bps DISCIPLINED RISK MANAGEMENT 2.6 Average Fleet Age 7.2 Lease Term Remaining

  5. Slide 5: Continued Momentum Across the Business Q2 2015

    Continued Momentum Across the Business Q2 2015 AVOLON Total commitments for 2016 stand at $1,392 million as of June 30, 2015 $756 million aircraft sales closed or under LOI as of June 30, 2015 $622 million of New Commitments First placement of B737-8 Max order Letters of intent for 3 aircraft signed

  6. Slide 6: Bohai and Hainan Airlines Transactions

    Bohai and Hainan Airlines Transactions AVOLON Bohai Leasing to acquire a 20% strategic interest in Avolon for $429m Cash tender offer at $26 per share, a 30% premium to Avolon’s IPO price Represents a 14.5% premium to Avolon’s VWAP in the week before the announcement Offer open to all Avolon shareho

  7. Slide 7: Financial Highlights

    AVOLON FINANCIAL HIGHLIGHTS

  8. Slide 8: Q2 Highlights

    Q2 Highlights AVOLON $741 million of New Aircraft Deliveries Q2 delivery timing – 2 aircraft in April, 8 aircraft in May and 4 aircraft in June 10 Airlines in 10 countries $23 million Trading Gains $232 million of letters of intent signed in the quarter for the sale of aircraft in Q3/4 Extension of

  9. Slide 9: Q2 2015 Sustained Strong Growth

    Q2 2015 Sustained Strong Growth AVOLON NET BOOK VALUE $ millions +27% 7,000 6,000 6,360 5,000 4,000 5,001 3,000 2,000 1,000 0 Q2 2014 Q2 2015 INTEREST EXPENSE $ millions +5% 60 50 51 40 49 30 20 10 0 Q2 2014 Q2 2015 REVENUE $ millions +38% 200 184 150 133 100 50 0 Q2 2014 Q2 2015 NET INCOME $ millio

  10. Slide 10: Generating Attractive Returns

    Generating Attractive Returns AVOLON EPS AND ROE PROGRESSION Q2 2014 Q2 2015 Change Adjusted ROE1 10.0% 16.0% +60% ROE 7.1% 14.4% +103% Diluted EPS ($) 0.31 0.68 +0.37 Adjusted EPS 2($) 0.41 0.75 +0.34 Weighted Average Shares Outstanding Diluted 78,307,618 81,227,419 Issued Shares 81,681,1313 82,428

  11. Slide 11: Trading Gains – Revising Guidance

    Trading Gains – Revising Guidance AVOLON TRADING GAINS Q2 2015 $23 million gains on $170 million of aircraft sold $ millions Cumulative 2012 – Q1 2015 Q2 2015 Trading Gain1 121 23 Total Interest Breakage Costs 8 Net Book Value2 1,382 170 % Gain on Sale3 8.8% 13.3% Sources: Company data 1 Trading gai

  12. Slide 12: Financial Outlook Update

    Financial Outlook Update AVOLON Acquisition Commitments $1,175m year to date, $492m deliveries in H2. Total of $1,667m $1,392m of commitments for 2016 (exclusive of Hainan SLB transaction) Expected Net Trading Gains of $60m-$65m from $55m-$60m in March 31, 2015 Target c. 8%-8.5% gain on expected sal

  13. Slide 13: Appendix

    AVOLON APPENDIX Find out more at www.avolon.aero

  14. Slide 14: Portfolio at June 2015

    Portfolio at June 30 2015 AVOLON AIRCRAFT TYPE OWNED MANAGED COMMITTED TOTAL A319ceo 1 - -1 A320ceo 49 3 16 68 A321ceo 10 1 11 22 A320neo - - 20 20 A330neo - - 15 15 A330-200/300 10 - - 10 B737-800 61 3 18 82 B737 MAX - - 20 20 B787-8/9 3 - 8 11 Boeing B777-300ER 3 - - 3 B777-200LRF - 2 - 2 E190 6 -

  15. Slide 15: Reconciliation of Adjusted Net Income

    Reconciliation of Adjusted Net Income AVOLON Adjusted net income is a measure of both liquidity and operating performance that is not defined by GAAP and should not be considered as an alternative to net income, income from operations, net cash provided by operating activities, or any other liquidit

  16. Slide 16: Reconciliation of Adjusted ROE

    Reconciliation of Adjusted ROE AVOLON Adjusted ROE is (Adjusted Net Income) / (Total shareholder’s equity) Q2 2014 Q2 2015 FY 2015 Guidance FY 2015 Guidance ROE 7.1% 14.4% 12.8% 13.1% Amortization of debt issuance costs 1.4% 1.9% 1.4% 1.4% Unrealized loss on derivatives 1.6% (0.8%) - - Share based c

  17. Slide 17: Reconciliation of Adjusted EPS

    Reconciliation of Adjusted EPS AVOLON $ Q2 2014 Q2 2015 Diluted EPS 0.31 0.68 Amortization of debt issuance costs 0.06 0.09 Unrealized loss on derivatives 0.07 (0.04) Share based compensation 0.00 0.03 Tax effect (0.00) (0.00) Effect of number of issued shares at June 30 (0.02) (0.01) Adjusted EPS 0

  18. Slide 18: Thank You

    AVOLON THANK YOU Find out more at www.avolon.aero

Avolon Holdings — Q2 2015 Earnings Presentation on 6ix