Ftai Aviation Ltd. · NASDAQ:FTAI
Ftai Aviation — Q4 2024 Earnings Presentation
51 slides from Ftai Aviation's earnings presentation, Feb 27, 2025
Slide 1: Q4 2024 Earnings Supplement
FTAI AVIATION Q4 2024 Earnings Supplement
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: Full Year 2024 Key Highlights
Full Year 2024 Key Highlights Strong financial performance supported by differentiated business model to accelerate growth in 2025 $1.7 Billion $276 Million $862 Million FY 2024 Revenue Adjusted Net Income(1) FY 2024 Adj. EBITDA(2) $3.0 Billion 690 Engines ~600 in Aviation Assets(3) Leasing Portfoli
Slide 4: Q4 2024 and Business Highlights
Q4 2024 and Business Highlights Strong Fourth Quarter Launched Strategic Capital Announced New MRE Facility Performance Initiative (SCI) in Europe(3) $86.7 Million $2.5 Billion • JV with IAG Engine Center Europe Net Income Attributable to Shareholders Committed Debt Financing Secured from ATLAS and
Slide 5: FTAI has 3 large facilities dedicated to maintenance, repair and exchange
MONTREAL FACILIT Y FTAI has 3 large facilities dedicated to maintenance, repair and exchange (MRE)(1) MIAMI FACILIT Y +900k 1,800 Sq. ft. of MRO space Module capacity across three facilities per year 3 ROME FACILIT Y Engine Test Cells Component Repairs PMA JV with Chromalloy 700 USM Program with AAR
Slide 6: Business Overview
6 Business Overview
Slide 7: Three Key Takeaways from FTAI's Aerospace Business
Three Key Takeaways from FTAI's Aerospace Business: FTAI's business model delivers comprehensive, customer-driven 1 engine solutions FTAI achieves higher margins compared to MRO peers through 2 green-time optimization and just-in-time delivery savings(1) FTAI’s total addressable market is $22 billio
Slide 8: FTAI's business model delivers comprehensive, customer-driven engine solutions
1 FTAI'S BUSINESS MODEL DELIVERS COMPREHENSIVE, CUSTOMER-DRIVEN ENGINE SOLUTIONS
Slide 9: Engines Are Complex and Expensive
Engines Are Complex and Expensive FTAI provides flexibility and cost-savings Engines Are ~$16M ~$9M Capital Intensive(1) Cost to Acquire Shop Visit cost CFM56-7B CFM56-7B Engines Require 3rd Regular Maintenance(2) Generally largest cost of an airline’s operating expense CUSTOMER BENEFITS Shop Visits
Slide 10: FTAI's Diverse Portfolio of Services Across the Value Chain
FTAI's Diverse Portfolio of Services Allows us to Play a Unique Role Across the Value Chain(1) FTAI’s vertically integrated Parts Heavy Green-time Maintenance Optimization Leasing business drives savings Manufacture OEM / PMA Performance Modular Aircraft and for our customers Restoration Maintenance
Slide 11: FTAI achieves higher margins compared to MRO peers through green-time optimization
2 FTAI ACHIEVES HIGHER MARGINS COMPARED TO MRO PEERS THROUGH GREEN-TIME OPTIMIZATION & JUST-IN-TIME DELIVERY SAVINGS
Slide 12: CFM56's Modular Design Results in Residual Life in Fan and LPT Modules
CFM56’s Modular Design Results in Residual Life in the Fan and LPT Modules The CFM56 engine consists of 3 modules Life limits of modules and parts vary 18 life-limited parts per engine Engine maintenance is needed when the core module hits its life-limit, even if the other two modules still have rem
Slide 13: Creating Value Through Green-time Optimization
Creating Value Through Green-time Optimization(1) Illustrative and not exhaustive Cycles Before MRE MRE Process Cycles After MRE Engines that are no longer serviceable due to LLP The three engines are divided into nine modules at After maintenance and reassembly, the engines are expiry may still con
Slide 14: Green-time Optimization Significantly Improves Traditional MRO Margins
Green-time Optimization Significantly Improves Traditional MRO Margins(1) Traditional MROs Incremental EBITDA Margin FTAI’s Full Potential Green-time optimization Module Swaps and LLP Recycling +15 – 25% EBITDA MARGIN 1 EBITDA MARGIN 15% ~35 - 50% Access to USM / PMA Harvest Inventory and Acquire at
Slide 15: Scaling Module Inventory Creates Optimal Green-time Solutions
Scaling Module Inventory Creates Optimal Green-time Solutions Illustrative and not exhaustive 3 Engines 10 Engines 456 Engines(1) 9 MODULES 30 MODULES 1,371 MODULES 33 = 27 103 = 1,000 4563 = 94,818,816 C O M B INAT I O NS C O M B INAT I O NS C O M B INAT I O NS Magnitude of combinations 1) FTAI CFM
Slide 16: FTAI's Total Addressable Market Is $22B With Only 5% Captured
3 FTAI’S TOTAL ADDRESSABLE MARKET IS $22B WITH ONLY 5% CAPTURED TO DATE(1) 1) $22 Billion estimated 2024 annual maintenance spend on the CFM56 and V2500 per Aviation Week. Aerospace Products generated $1 billion of revenue in 2024, which equates to approximately 5% market share.
Slide 17: FTAI Focuses on CFM56-5B/7B and V2500 Engines
FTAI Focuses on the CFM56-5B/7B and V2500 Engines, Covering ~60% of Commercial Narrowbody Jets Global Narrowbody Aircraft Count Global Narrowbody Engine Count A320CEO OTHER OTHER CFM56-5B/7B 2,272 4,148 6,395 PW1000G 737 MAX 1,673 4,160 18,802 (47%) 3,674 LEAP A320NEO 7,354 5,977 5,518 (14%) 737 NG
Slide 18: FTAI Core Customer: Small and Medium Airlines
FTAI Core Customer: Small and Medium Airlines(1) SMALL AIRLINE MEDIUM AIRLINE LARGE AIRLINE (<100 ENGINES) (100-500 ENGINES) (>500 ENGINES) Operating Mixed but lean towards Generally mixed fleet Single fleet type profile single fleet types types 557 airlines 50 airlines 5 airlines Scale ~9,700 engin
Slide 19: Our addressable market is $22B; we've only captured ~5%
FTAI’S CURRENT MARKET SHARE ~$1B 5% LARGE AIRLINES Our addressable market is ~$5B $22B 23% Total We’ve only captured $22B ~5% to date 2024 estimated global commercial engine MRO demand ~$16B for CFM56-5B/7B and V2500, 73% SMALL AND MEDIUM AIRLINES $22B estimated annual maintenance spend on the CFM56
Slide 20: Financial Results
Financial Results 20
Slide 21: Capital Structure
Capital Structure Significant growth in generation of Adj. EBITDA(1) creates significant operational leverage: • Net Debt / Run-Rate Adj. EBITDA(1) multiple of 3.7x in Q4 2024 • Full $400 Million of Corporate Revolver Facility available as of December 31, 2024 • Targeting Net Debt / Run-Rate Adj EBI
Slide 22: Portfolio Composition
Portfolio Composition Significant investment in Aviation Assets in 2024 to support growth of MRE pipeline in 2025(1): • Scaled V2500 Engine asset count from 68x in Q4 2023 to 184x in Q4 2024 • Q4 2024 CFM56 Engine asset count of 456x versus 398x in prior year(2) • Aircraft portfolio as of Q4 2024 in
Slide 23: 2024 Adjusted FCF and Growth Initiatives
2024 Adjusted FCF and Growth Initiatives Strong cashflow generation in 2024 with significant investments for accelerated growth • Generated approximately $672 million from recurring operations and gains on Aviation Leasing and Offshore Sales • Approximately $1.3 Billion invested in growth initiative
Slide 24: 2025 Target Adjusted Free Cash Flow
2025 Target Adjusted Free Cash Flow(1) Strong cashflow generation in 2025 • Targeting approximately ~$650 million in Adjusted Free Cash flow for FY 2025 • Generating approximately ~$550 million from sale of 46x Aircraft seed portfolio to 2025 SCI Partnership • Excess cash to be utilized for growth i
Slide 25: Aerospace Products
2 5 Aerospace Products
Slide 26: Aerospace Products Results
Aerospace Products Results Innovative Maintenance Solutions for the CFM56 and V2500 Engines • $381M FY 2024 Adj. EBITDA(1) versus original guidance of $200M - $250M • Produced 136x modules in Q4 2024 (Montreal 75 / Miami 61) • Adj. EBITDA Margin of 35% excluding Legacy 3rd Party Revenue performed at
Slide 27: Aviation Leasing
Aviation Leasing 27
Slide 28: Aviation Leasing Results
Aviation Leasing Results • $500 million Adj. EBITDA for FY2024 versus $467 million in prior year(1) • $11 million in recoveries from assets written-off from Russia/Ukraine War included in Q4 2024 • Q4 2024 Adj. EBITDA excluding gains on sales and recoveries grew 18% YoY(1) Statement of Operations Ad
Slide 29: Aviation Leasing KPI Metrics
Aviation Leasing KPI Metrics Providing Flexible Green-time Power to Airline Customers • Acquired 49x engines & 23x aircraft during Q4 2024 • Q4 2024 annualized Adj. EBITDA yield of 23%(1) • Performed 27x engine exchanges for aircraft lessees in 2024 Q4 2024 ENGINES AIRCRAFT TOTA L # Assets(2) 312 10
Slide 30: Corporate & Other
Corporate & Other
Slide 31: Corporate & Other
Corporate & Other Executed Key Transactions in Q4 2024 reducing cost of capital and generating liquidity to support growth: • Sold both offshore vessels for a gain on sale of $18.7 million • Issued $500 million 5.875% senior bonds due 2033 • Repaid in full outstanding $131M balance of senior bonds d
Slide 32: End Notes
End Notes Slide Footnote Description (1) Comprised of Net Loss Attributable to Shareholders of ($32.1) million adjusted for $300.0 million related to internalization fee and $8.5 million of non-recurring FIG management and incentive fees. (2) This is a Non-GAAP measure. See Reconciliation of Non-GAA
Slide 33: Appendix
Appendix Statement of Operations by Segment Comparative Statements of Operations Condensed Balance Sheets Reconciliation of Non-GAAP Measures Glossary 33
Slide 34: Appendix
Appendix Statement of Operations by Segment Comparative Statements of Operations Condensed Balance Sheets Reconciliation of Non-GAAP Measures Glossary 34
Slide 35: Statement of Operations by Segment (Q4 2024)
Statement of Operations by Segment (unaudited) For the Three Months Ended December 31, 2024 ($s in thousands) Aviation Leasing Aerospace Products Corporate and Other Total Revenues $ 156,424 $ 342,095 $ 300 $ 498,819 Expenses Cost of sales 40,435 217,292 — 257,727 Operating expenses 8,511 7,308 18,7
Slide 36: Statement of Operations by Segment (Q4 2023)
Statement of Operations by Segment (unaudited) For the Three Months Ended December 31, 2023 Aviation Leasing Aerospace Products Corporate and Other Total ($s in thousands) Revenues $ 153,802 $ 158,457 $ 478 $ 312,737 Expenses Cost of sales 33,509 101,714 — 135,223 Operating expenses 9,266 7,621 12,0
Slide 37: Statement of Operations by Segment (FY 2024)
Statement of Operations by Segment (unaudited) Year Ended December 31, 2024 ($s in thousands) Aviation Leasing Aerospace Products Corporate and Other Total Revenues $ 628,437 $ 1,079,821 $ 26,643 $ 1,734,901 Expenses Cost of sales 151,977 673,907 — 825,884 Operating expenses 35,495 23,818 56,548 115
Slide 38: Statement of Operations by Segment (FY 2023)
Statement of Operations by Segment (unaudited) Year Ended December 31, 2023 ($s in thousands) Aviation Leasing Aerospace Products Corporate and Other Total Revenues $ 681,611 $ 454,970 $ 34,315 $ 1,170,896 Expenses Cost of sales 221,852 280,280 — 502,132 Operating expenses 37,876 20,459 51,828 110,1
Slide 39: Appendix
Appendix Statement of Operations by Segment Comparative Statements of Operations Condensed Balance Sheets Reconciliation of Non-GAAP Measures Glossary 39
Slide 40: Consolidated Comparative Statements of Operations
Consolidated — Comparative Statements of Operations (unaudited) Three Months Ended ($s in thousands) 12/31/2023 3/31/2024 6/30/2024 9/30/2024 12/31/2024 Revenues Lease Income $ 46,795 $ 53,161 $ 70,754 $ 65,450 65,973 Maintenance revenue 50,216 45,790 51,187 59,917 43,915 Asset sales revenue 56,214
Slide 41: Aviation Leasing Comparative Statements of Operations
Aviation Leasing — Comparative Statements of Operations (unaudited) Three Months Ended ($s in thousands) 12/31/2023 3/31/2024 6/30/2024 9/30/2024 12/31/2024 Revenues Lease income $ 46,726 $ 50,846 $ 60,759 $ 57,322 $ 65,484 Maintenance revenue 50,216 45,790 51,187 59,917 43,915 Asset sales revenue 5
Slide 42: Aerospace Products Comparative Statements of Operations
Aerospace Products — Comparative Statements of Operations (unaudited) Three Months Ended ($s in thousands) 12/31/2023 3/31/2024 6/30/2024 9/30/2024 12/31/2024 Revenues Aerospace products revenue $ 158,457 $ 189,057 $ 245,200 $ 303,469 342,095 Total revenues $ 158,457 $ 189,057 $ 245,200 $ 303,469 $
Slide 43: Corporate and Other Comparative Statements of Operations
Corporate and Other — Comparative Statements of Operations (unaudited) Three Months Ended ($s in thousands) 12/31/2023 3/31/2024 6/30/2024 9/30/2024 12/31/2024 Revenues Lease income $ 69 $ 2,315 $ 9,995 $ 8,128 $ 489 Other revenue 409 12 3,962 1,931 (189) $ Total revenues $ 478 $ 2,327 $ 13,957 $ 10
Slide 44: Appendix
Appendix Statement of Operations by Segment Comparative Statements of Operations Condensed Balance Sheets Reconciliation of Non-GAAP Measures Glossary 44
Slide 45: Condensed Balance Sheets
Condensed Balance Sheets December 31, ($s in thousands) 2024 2023 Gross Property, Plant and Equipment (PP&E) $ 115,867 $ 47,089 Accumulated Depreciation on PP&E (8,416) (1,914) Net PP&E $ 107,451 $ 45,175 Gross Leasing Equipment 2,963,452 2,574,394 Accumulated Depreciation on Leasing Equipment (589,
Slide 46: Appendix
Appendix Statement of Operations by Segment Comparative Statements of Operations Condensed Balance Sheets Reconciliation of Non-GAAP Measures Glossary 46
Slide 47: Adjusted EBITDA Reconciliation by Segment (Q4 2024)
Adjusted EBITDA Reconciliation by Segment (unaudited) For the Three Months Ended December 31, 2024 Aviation Aerospace ($s in thousands) Corporate and Other Total Leasing Products Net income (loss) attributable to shareholders $ 55,276 $ 101,250 $ (69,834) $ 86,692 Add: Provision for (benefit from) i
Slide 48: Adjusted EBITDA Reconciliation by Segment (FY 2024)
Adjusted EBITDA Reconciliation by Segment (unaudited) For the Year Ended December 31, 2024 Aviation Aerospace ($s in thousands) Corporate and Other Total Leasing Products Net income (loss) attributable to shareholders $ 210,249 $ 346,346 $ (588,674) $ (32,079) Add: Provision for (benefit from) incom
Slide 49: Notes to Non-GAAP Reconciliations — Adjusted EBITDA
Notes to Non-GAAP Reconciliations — Adjusted EBITDA ($s in thousands) Total Aerospace Products (1) Total Includes the following items for the three months ended Includes the following items for the three months ended December 31, 2024 and 2023: (i) net (loss) income of $(401) December 31, 2024 and 2
Slide 50: Appendix
Appendix Statement of Operations by Segment Comparative Statements of Operations Condensed Balance Sheets Reconciliation of Non-GAAP Measures Glossary 50
Slide 51: Glossary
Glossary Adjusted EBITDA In addition to net income (loss), the chief operating decision maker (“CODM”) utilizes Adjusted EBITDA as a key performance measure. Adjusted EBITDA is not a financial measure in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). This performance me