Slide 1: AerCap Holdings N.V. Second Quarter 2010 Earnings Call
AerCap Holdings N.V. Second Quarter 2010 Earnings Call August 5, 2010
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: Second Quarter 2010 Highlights
Second Quarter 2010 Highlights Net income was $59.6 million for second quarter 2010, exclusive of the impact relating to mark-to-market of interest rate caps and share-based compensation Earnings per share for second quarter 2010 was $0.50, exclusive of the impact relating to mark-to-market of i
Slide 4: Aircraft and Engine Transactions Year to Date (June) 2010
Aircraft and Engine Transactions Year to Date (June) 2010 10 aircraft lease agreements & letters-of-intent executed 30 aircraft and 23 engines delivered to lessees 39 aircraft and 7 engines purchased 10 aircraft and 8 engines sold from our owned portfolio 4
Slide 5: Net Income
Net Income ($ Millions) 2Q 2009 2Q 2010 Total Net Income 56.6 48.9 Adjusted for: (Gain)/Loss from mark-to-market on interest (18.3) 10.1 rate caps * Adjusted for: Cost of share- based compensation 0.8 0.6 Net Income excluding above adjustments 39.1 59.6 * Reduced for tax impact and the amount relati
Slide 6: Earnings Per Share
Earnings Per Share ($’s) 2Q 2009 2Q 2010 Earnings Per Share 0.67 0.41 Adjusted for: mark-to-market on interest rate caps and share (0.21) 0.09 based compensation Earnings Per Share excluding 0.46 0.50 above adjustments Average Shares Outstanding 85.0 119.4 * (Millions) * Increase of 34.4 million sha
Slide 7: Total Revenue
Total Revenue ($ Millions) 2Q 2009 2Q 2010 Basic Lease Rents 141.4 228.6 Maintenance/End-of-Lease Revenue 28.4 32.1 Sales Revenue 117.9 328.1 Management Fees and Interest Income 6.3 4.1 Other Revenue 0.7 1.8 Total Revenue 294.7 594.7 7
Slide 8: Net Spread (Margin)
Net Spread (Margin) ($ Millions) 2Q 2009 2Q 2010 % Change Basic Lease Rents 141.4 228.6 62% Less: Interest Expense* (28.8) (59.6) 107% Net Spread (Margin) 112.6 169.0 50% Average Lease Assets 4,386 7,479 71% Annualized Margin (% Lease Assets) ** 10.27% 9.04% * Excludes non-cash charges relating to t
Slide 9: Sales
Sales ($ Millions) 2Q 2009 2Q 2010 Aircraft Sales 67.9 282.8* Engine Sales 23.1 9.4 Part Sales 26.9 35.9 Total Sales Revenue 117.9 328.1 Total Gain from Sales 12.4 14.4 * Includes 2 new A330 forward sales agreed in 1st half 2009, 2 new A320 forward sales and 1 older B767 9
Slide 10: Leasing Expenses and SG&A
Leasing Expenses and SG&A ($ Millions) 2Q 2009 2Q 2010 % Change Operating lease in costs 3.3 3.1 (6%) Leasing expenses * 22.1 15.9 (28%) SG&A** 27.8 34.9 26% Total Leasing Expenses and 53.2 53.9 1% SG&A * Details on following page ** 2Q 2010 SG&A includes $3.4m mark-to-market charge relating to fore
Slide 11: Leasing Expenses
Leasing Expenses ($ Millions) 2Q 2009 2Q 2010 % Change Default Related Leasing 4.5 0.0 (100%) Expenses * Normal Transition Costs 3.6 4.2 18% Lessor Maintenance 8.1 7.9 (2%) Contributions AeroTurbine & Other Leasing 5.9 3.8 (36%) Costs Total Leasing Expenses 22.1 15.9 (28%) *Costs in 2009 relating to
Slide 12: Asset Impairment
Asset Impairment ($ Millions) Maintenance Asset Net Revenue Impairment Amount Actual 2nd Qtr 2009 13.7 (13.7) 0.0 2nd Qtr 2010 * 4.9 (2.7) 2.2 * 2Q 2010 maintenance revenue/impairment relates to an airline default in Genesis portfolio 12
Slide 13: Tax Rate
Tax Rate FY 2009 YTD 2010 Tax Rate for Aircraft 0.0% 9.5% Charge Tax Rate for Engine/Parts 36.8% Charge (32.1%) Income Blended Tax Rate 1.9% Charge 8.8% Charge 13
Slide 14: Total Assets and Number of Aircraft/Engines
Total Assets and Number of Aircraft/Engines 2Q 2009 2Q 2010 ($ Millions) 10,000 9,098 8,000 6,131 48% increase over Total Assets Owned and on 6,000 2Q 2009 Balance Sheet ~25% increase ($1.5B) 4,000 relates to Genesis Transaction 2,000 0 Number of Aircraft Owned, On Order, Managed, Contracted, on LOI
Slide 15: Purchases of Aviation Assets
Purchases of Aviation Assets ($ Millions) YTD Committed Total 2010 Remaining 2010 2010 Aircraft Related 1,756 702 2,458 Engines/Airframes 20 6 26 Total Purchases 1,776 708 2,484 Number of Aircraft 39 15 54 Purchases (Units) 15
Slide 16: Portfolio Management Metrics Owned Aircraft
Portfolio Management Metrics Owned Aircraft Lease Portfolio FY 2009 YTD 2010 Utilization Rate 98.1% 99.0% Portfolio Yield* 14.3% 13.2% Average Term (Months) – New Leases for New Aircraft 139 **138 – New Leases for Used Aircraft 50 *** 65 * Lease revenue divided by average book value of flight equipm
Slide 17: Cash
Cash ($ Millions) 2Q 2010 Cash and Cash Equivalents at June 30, 2010 260.3 Total Cash Balance at June 30, 2010 506.7 (Incl. Restricted Cash) Operating Cash Flow for 2Q 2010 167.8 17
Slide 18: Debt and Equity
Debt and Equity ($ Millions) 2Q 2009 2Q 2010 Total Debt at Quarter-End 4,337 6,394 Average Cost of Debt* 2.7% 3.6% Equity 1,295 1,921 Debt / Equity Ratio** **3.3 to 1 **3.3 to 1 * Interest expense divided by average debt balance, excluding mark-to-market on interest rate caps and other small charges
Slide 19: Interest on Debt
Interest on Debt ($ Millions) 2Q 2009 2Q 2010 YTD 2009 YTD 2010 Interest on Debt from Financial 6.0 75.5 35.5 126.9 Statements Less: Mark-to-Market on Interest Rate Caps 22.8 (15.9) 22.2 (34.2) Interest on Debt Excl. MTM on 28.8 59.6 57.7 92.7 Caps (for Net Spread calc.) Less: Impact from Genesis Tr
Slide 20: Debt & Interest Rate Hedging
Debt & Interest Rate Hedging Segmentation of Debt Based on Type of Interest $ Billions (Approx.) Rate Hedge (June 30, 2010) Fixed Rate Debt 1.0 Debt under Fixed Rate Swaps (from Genesis 0.9 Transaction) Debt Covered by Interest Rate Caps 2.5 Debt Related to Floating Rate/Short Term Leases 1.8 and Of
Slide 21: 2010 Financial Outlook
2010 Financial Outlook AerCap expects to grow earnings based on the committed aircraft purchases despite the continued uncertainties of the financial markets. Set forth below are the anticipated drivers for AerCap’s 2010 financial performance, which are subject to change, in light of the highly flui
Slide 22: Appendix
Appendix * (AERCAP 22
Slide 23: Forward Order Aircraft
Forward Order Aircraft Options Options (1) 4 Additional 4 Additional 4 Additional 4 Additional 5 5 Purchases Purchases Purchases Purchases (2) (2) (2) (2) Available LOI Sold Sold Sold 20 3 12 16 16 Available Sold 57 12 Lease Lease Lease Agreements Agreements Agreements Sold 15 33 20 9 Lease LOI Agre
Slide 24: High Quality and Well Diversified Portfolio
High Quality and Well Diversified Portfolio Aircraft Portfolio as of June 30, 2010 79% narrow body – “Work Horses” of industry Aircraft under Number of Number of Purchase/Sale Owned % Net Book Managed Aircraft Contract or Total High share of liquid / remarket- Aircraft Value Aircraft on Order LO