Aercap Holdings N.v. · NYSE:AER
Aercap — Q3 2009 Earnings Presentation
27 slides from Aercap's earnings presentation, Nov 6, 2009
Slide 1: AerCap Holdings N.V. Third Quarter 2009 Earnings Call
AerCap Holdings N.V. Third Quarter 2009 Earnings Call November 6, 2009
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: Third Quarter 2009 Financial Highlights
Third Quarter 2009 Financial Highlights Net income was $39.2 million for third quarter 2009, exclusive of non-cash charges relating to mark-to-market of interest rate caps and share-based compensation Earnings per share for third quarter 2009 were $0.46 on the same basis Basic rents in third q
Slide 4: Genesis Transaction Update
Genesis Transaction Update Two of three regulatory approvals obtained (Germany and US received, awaiting Turkey) Initial comments received from SEC this week Transitional activities underway Closing most likely early 2010 (based on timing of SEC initial comments) 4
Slide 5: Aircraft and Engine Transactions During Third Quarter 2009
Aircraft and Engine Transactions During Third Quarter 2009 11 new aircraft lease agreements & letters-of-intent executed 8 aircraft and 14 engines delivered to lessees 6 aircraft and 3 engines purchased 3 aircraft and 3 engines sold from our owned and managed portfolios 5
Slide 6: Forward Order Aircraft
Forward Order Aircraft Options Options (1) 4 Additional 5 5 Purchases (2) Available LOI 20 13 Available 57 Sold 9 Sold 9 Lease LOI Agreements 4 Lease 42 Sold Agreements 7 51 Lease Agreements Delivered 25 33 Delivered Delivered 15 2 As of As of As of December 31, 2007 December 31, 2008 October 15, 20
Slide 7: Net Income
Net Income ($ Million) 3Q 2008 3Q 2009 Total Net Income 51.3* 35.5** Mark-to-market on interest rate caps 8.2 3.0 Share-based compensation 1.7 0.7 Net Income excluding above 61.2* 39.2** charges * 3Q 2008 includes ~$30.6 million maintenance rents and end-of-lease compensation (net of tax) ** 3Q 2009
Slide 8: Net Income Analysis
Net Income Analysis ($ million) 3Q 2008 3Q 2009 Variance Net Spread 93.3 114.6 21.3 Depreciation (45.3) (55.7) (10.4) SG&A (33.4) (27.8) 5.6 Subtotal 14.6 31.1 16.5 Maintenance Revenue – Change in Est. 12.9 0.0 (12.9) Impact from 2008 Defaults – Maint. Rev. 8.3 0.0 (8.3) Impact from 2008 Defaults –
Slide 9: Earnings Per Share
Earnings Per Share 3Q 2008 3Q 2009 Earnings Per Share $0.60* $0.42** Adjusted for: mark-to-market on interest rate caps and share 0.12 0.04 based compensation Earnings Per Share $0.72* $0.46** excluding above charges Average Shares Outstanding 85.0 85.0 (Million) * 3Q 2008 includes ~$0.36 per share
Slide 10: Total Revenue
Total Revenue ($ Million) 3Q 2008 3Q 2009 Basic Lease Rents 132.9 142.4 Basic rents up 7% over Maintenance/End-of-Lease Revenue 35.0 11.4* third quarter Sales Revenue 122.4 49.0 2008 Management Fees and Interest 8.0 5.3 Income Other Revenue 3.6 4.4 Total Revenue 301.9 212.5 * Decrease in maintenance
Slide 11: Net Spread (Margin) – Third Quarter
Net Spread (Margin) – Third Quarter ($ Million) 3Q 2008 3Q 2009 % Change Basic Lease Rents 132.9 142.4 7% Less: Interest Expense* (39.6) (27.8) (30%) Net Spread (Margin) 93.3 114.6 23% Average Lease Assets 3,731 4,596 23% Annualized Margin (% Lease Assets) 10% 10% * Excludes non-cash charges relatin
Slide 12: Net Spread (Margin) – First Nine Months of 2009
Net Spread (Margin) – First Nine Months of 2009 ($ Million) YTD 2008 YTD 2009 % Change Basic Lease Rents 386.0 425.2 10% Less: Interest Expense* (114.2) (85.5) (25%) Net Spread (Margin) 271.8 339.7 25% Average Lease Assets 3,490 4,368 25% Annualized Margin (% Lease Assets) 10% 10% * Excludes non-cas
Slide 13: Sales
Sales ($ Million) 3Q 2008 3Q 2009 Aircraft Sales 96.8 5.2 Engine Sales 6.0 13.2 Part Sales 19.6 30.6 Total Sales 122.4 49.0 Total Gain from Sales (pre-tax) 13.6 9.0 13
Slide 14: Leasing Expenses and SG&A
Leasing Expenses and SG&A 3Q 2008 3Q 2009 % Change ($ Million) Operating lease in costs 4.3 3.3 (23%) Leasing expenses * 5.4 10.6 96% SG&A 33.4 27.8 (17%) Other Expenses ** 0.0 1.9 Unfavorable Total Leasing Expenses and SG&A 43.1 43.6 (1%) * Details on following page ** Accrual of expenses relating
Slide 15: Leasing Expenses
Leasing Expenses 3Q 2008 3Q 2009 ($ Million) Default Related Costs 0.1 4.3* Normal Transition Costs 4.4 3.2 Lessor Maintenance (0.8)** 1.6 Contributions AeroTurbine & Other 1.7 1.5 Leasing Costs Total Leasing Expenses 5.4 10.6 * Costs relate to airline defaults which occurred during 2008 (Gemini, In
Slide 16: Impact from Defaults & Restructuring
Impact from Defaults & Restructuring ($ Millions) 3Q 2009 YTD 2009 2008 Total Lost Basic Lease Rents (Net of Security Deposits) (0.9) (4.1) (14.3) Provision for Doubtful Accounts Receivable 0.0 0.0 (1.1) Maintenance Rents 0.0 0.0 12.2 Leasing Expenses (4.3) (15.6) (15.5) Total (5.2) (19.7) (18.7) Ac
Slide 17: Tax Rate
Tax Rate FY 2008 YTD 2009 Tax Rate for Aircraft 2.0% Charge 0.4% Charge Tax Rate for Engine/Parts (56.8%) Income 36.4% Charge Blended Tax Rate (0.3%) Income 2.5% Charge Note: The tax income in 2008 resulted because the most significant portion of the charges relating to airline defaults and inventor
Slide 18: Total Assets and Number of Aircraft/Engines
Total Assets and Number of Aircraft/Engines 3Q 2008 3Q 2009 ($ Million) 8,000 6,418 5,270 6,000 Total Assets 22% increase over Owned and on 4,000 3Q 2008 Balance Sheet 2,000 0 Number of Aircraft Owned, On Order, Managed, Decrease in units largely driven by Contracted, on LOI (units) 314 304 sales of
Slide 19: Purchases of Aviation Assets
Purchases of Aviation Assets ($ Million) YTD 2009 Total 2009 Commitments Aircraft Related 1,070 1,789 Engines/Airframes 39 43 Total Purchases 1,109 1,832 Number of Aircraft 27 41 Purchases (Units) 19
Slide 20: Portfolio Management Metrics Owned Aircraft
Portfolio Management Metrics Owned Aircraft Lease Portfolio FY 2008 YTD 2009 Utilization Rate 97.7% 98.0% Portfolio Yield* 16.9% 14.8% Average Term (Months) – New Leases for New Aircraft 124 135** – New Leases for Used Aircraft 65 46*** * Lease revenue divided by average book value of flight equipme
Slide 21: Cash
Cash ($ million) 3Q 2009 Cash and Cash Equivalents at Sept. 30, 2009 $203 Total Cash Balance at Sept. 30, 2009 (Incl. Restricted Cash) $324 Operating Cash Flow for 3Q 2009 $119 21
Slide 22: Debt and Equity
Debt and Equity ($ Million) 3Q 2008 3Q 2009 Total Debt 3,603 4,593 Average Cost of Debt in Third Quarter* 4.3% 2.6% Equity 1,151 1,335 Debt / Equity Ratio 3.1 to 1** 3.4 to 1** * Interest expense divided by average debt balance, excluding mark-to-market on interest rate caps ** Debt/Equity ratio is
Slide 23: 2009 Financial Outlook (AerCap Stand-Alone)
2009 Financial Outlook (AerCap Stand-Alone) The financial markets and access to capital remain uncertain and volatile. As a result, AerCap’s 2009 financial outlook is less certain than in years past, particularly given the stresses imposed by the global economic climate on the financial conditions o
Slide 24: 2010 Financial Outlook (Combined Company)
2010 Financial Outlook (Combined Company) The financial markets and access to capital remain uncertain and volatile. As a result, the 2010 financial outlook is less certain than in years past, particularly given the stresses imposed by the global economic climate on the financial conditions of many
Slide 25: Appendix
Appendix * (AERCAP 25
Slide 26: High Quality and Well Diversified Portfolio
High Quality and Well Diversified Portfolio Aircraft Portfolio as of September 30, 2009 Aircraft 82% narrowbody – “Work under Horses” of industry Number of Number of Purchase Owned % Net Book Managed Aircraft Contract or Total Aircraft Value Aircraft on Order LOI Aircraft High share of liquid /
Slide 27: Aircraft Portfolio Valuation
Aircraft Portfolio Valuation Carrying Difference/ ($ Billion) External Value or Appraisers Appraisers Price Paid Value A320 Family, A330s, & B737NGs (~95% of Portfolio; 6.00 6.79 13% …only ~11% > 8 Years of Age) B757s, B767s, A300s 0.16 0.18 13% (~3.0% of Portfolio) B737 Classics and All Others 0.15