Aercap Holdings N.v. · NYSE:AER
Aercap — Q4 2015 Earnings Presentation
31 slides from Aercap's earnings presentation, Feb 23, 2016
Slide 1: Fourth Quarter 2015 Financial Results
Fourth Quarter 2015 Financial Results February 23, 2016 AerCap Holdings N.V.
Slide 2: Disclaimer Incl. Forward Looking Statements & Safe Harbor
Disclaimer Incl. Forward Looking Statements & Safe Harbor This presentation contains certain statements, estimates and forecasts events described in the forward-looking statements in this presentation with respect to future performance and events. These statements, might not occur. Accordingly, you
Slide 3: AerCap Investment Case
AerCap Investment Case AerCap is the largest and most profitable aircraft lessor Strong and resilient industry fundamentals Industry leading earnings and profitability Efficient and scalable platform Strong growth profile Strong liquidity and access to capital Hedging strategies to mitigate risk Hig
Slide 4: Financial Results and Highlights
Financial Results and Highlights Financial Results Highlights ADJUSTED NET INCOME • 405 aircraft transactions in 2015, including 117 • $1,275.8 million for FY 2015 widebody transactions ($1,178.7 million reported) • $9.2 billion of available liquidity2 • $282.1 million for 4Q 2015 • $1.9 billion of
Slide 5: Market Concerns vs. Reality
Market Concerns vs. Reality CONCERN REALITY Low oil prices diminishing value of orderbook Stable new aircraft placements China & other emerging markets Robust traffic growth in most markets Declining widebody aircraft values Stable demand for most widebodies Availability of credit Closed 2015 with r
Slide 6: Low Oil Prices
Low Oil Prices Low oil prices are unequivocally good for aircraft leasing companies Airlines Continue to Demand New Aircraft Despite L ow F uel Environment Value of New Aircraft Placed WTI Crude Oil • Low oil prices boost airlines’ ($ billion) Spot Price ($) 1.4 18 aircraft profitability and credit
Slide 7: China & Other Emerging Markets
China & Other Emerging Markets AerCap continues to place aircraft on favorable terms across the globe China Remains a Strong Market for AerCap Global Traffic Remains Healthy • Despite slower GDP g rowth, d emand for air • Strong o verall g lobal traffic g rowth 6.5% in travel remains strong as China
Slide 8: Track Record of Widebody Placement
Track Record of Widebody Placement AerCap platform continues to successfully place widebody aircraft REMARKETING OF USED WIDEBODY AIRCRAFT IS WELL UNDER WAY Boeing 777s Airbus A330s Total 2015 2016 2017 2018 Total 2015 2016 2017 2018 Total 2015-2018 Scheduled expiries (Dec. 31, 2014) 1 4 12 28 45 7
Slide 9: Strong Liquidity Position
Strong Liquidity Position Record liquidity of $9.2 billion demonstrates AerCap’s strong access to capital CONSISTENT COMMITMENT TO LIQUIDITY 10.0 3.0x 9.2 ($ billion) 9.0 2.5x • Total sources o f liquidity 8.0 7.3 7.2 cover d ebt repayments and 7.0 6.5 6.6 6.6 6.4 capital commitments for the 2.0x ne
Slide 10: Share Repurchase Program
Share Repurchase Program Board authorized $400 million share repurchase program ($ billion) 0.8 - 1.0 $1.0 • $400 million share repurchase p rogram authorized in 1Q 2016 Additional • $0.8 - $1.0 b illion o f excess capital $0.5 available for d eployment for full year 0.4 2016 • Excess capital avai
Slide 11: Net Income
Net Income ($ million) 4Q 2015 4Q 2014 FY 2015 FY 2014 Reported Net Income 264.2 298.2 1,178.7 810.4 Adjusted for: • Mark-to-market on interest rate caps (0.1) 4.2 15.9 14.6 and swaps, net of tax • Transaction and integration expenses, net of 1.3 10.4 8.4 130.2 tax1 • Maintenance rights related ex
Slide 12: Earnings Per Share
Earnings Per Share ($) 4Q 2015 4Q 2014 FY 2015 FY 2014 Reported Basic Earnings Per Share 1.34 1.41 5.78 4.61 Adjusted for: • Mark-to-market on interest rate caps and swaps, transaction and integration related expenses, and maintenance rights related 0.09 (0.01) 0.48 0.25 expenses, all net of tax A
Slide 13: Maintenance Rights: 4Q 2015 Adjustment
Maintenance Rights: 4Q 2015 Adjustment ($ million) Reported Amount Adjusted Amount Adjustment Depreciation and Amortization (471.7) (537.7) (66.0) Leasing Expenses (126.3) (41.3) 85.0 Pre-Tax Income Impact 19.0 Net Income Impact 16.7 • As a result of purchase accounting, a p ortion o f the acquired
Slide 14: Revenues and Other Income
Revenues and Other Income ($ million) 4Q 2015 4Q 2014 FY 2015 FY 2014 Basic Lease Rents1 1,148.8 1,159.0 4,635.8 3,282.8 Maintenance Rents and Other Receipts2 136.7 79.8 355.8 166.8 Net Gain on Sale of Assets 43.4 25.8 183.3 37.5 Other Income 9.1 28.0 112.7 104.5 Total Revenues and Other Income 1,33
Slide 15: Net Interest Margin (Net Spread)
Net Interest Margin (Net Spread) ($ million) 4Q 2015 4Q 2014 FY 2015 FY 2014 Net Interest Margin (Net Spread)1 874.3 883.5 3,554.0 2,519.2 Average Lease Assets2 35,836 36,058 36,311 25,624 Annualized Net Spread % 9.8 9.8 9.8 9.8 AerCap continues to deliver consistent net spreads (1) Net Interest Mar
Slide 16: Aircraft Disposals and Purchases
Aircraft Disposals and Purchases ($ million) 4Q 2015 4Q 2014 FY 2015 FY 2014 Pre-Tax Gain from Aircraft Sales 43.4 25.8 183.3 37.5 4Q 2015 Disposal Activity1: • 22 aircraft, with an average age of 12 years, were sold and 3 aircraft were parted-out from our owned portfolio: • 3 Airbus A319-100s, 2
Slide 17: Other Expenses and Taxes
Other Expenses and Taxes ($ million) 4Q 2015 4Q 2014 FY 2015 FY 2014 Leasing Expenses1 126.3 74.8 522.4 141.6 Selling, General & Administrative 103.6 117.5 381.3 299.9 Expenses Asset Impairment 1.0 20.0 16.3 21.8 Transaction, Integration and 50.8 11.9 58.9 148.8 Restructuring Related Expenses2 FY 20
Slide 18: Cash
Cash ($ million) 2015 2014 Cash and Cash Equivalents as of December 31 2,403.1 1,490.4 (excl. restricted cash) Total Cash Balance as of December 31 2,822.5 2,207.8 (incl. restricted cash) Operating Cash Flow for the Full Year 3,360.0 2,313.7 Operating Cash Flow for the Fourth Quarter 953.8 839.7 Ann
Slide 19: Capital Structure
Capital Structure Summary 4Q 2015 4Q 2014 Average Cost o f Debt (including all fees)1 3.7% 3.6% Debt / Equity Ratio 2.9 to 1 3.4 to 1 Debt/Equity Calculation ($ million) 4Q 2015 4Q 2014 Debt at Quarter-End (incl. fair value adjustments) 29,807 30,402 Adjusted for: • Unrestricted cash & cash equival
Slide 20: Financial Outlook
Financial Outlook DUBLIN | AMSTERDAM | LOS ANGELES | SHANNON | FORT LAUDERDALE | MIAMI | SINGAPORE | SHANGHAI | ABU DHABI | SEATTLE | TOULOUSE ‘AERCAP.COM
Slide 21: 2015 Financial Performance – Adjusted Basis
2015 Financial Performance – Adjusted Basis AerCap’s 2015 financial performance ($ b illion) 2015 Sales/One-off 2015 Core Lease Revenue 5.0 - 5.0 Other Revenue (incl. Gain o n Sale) 0.3 (0.2) 0.1 Depreciation and Amortization (2.1) - (2.1) Interest Expense (1.1) - (1.1) Leasing Expenses, SG&A &
Slide 22: Q&A
GLOBAL LEADER IN AVIATIO Q&A DUBLIN | AMSTERDAM | LOS ANGELES | SHANNON | FORT LAUDERDALE | MIAMI | SINGAPORE | SHANGHAI | ABU DHABI | SEATTLE | TOULOUSE ‘AERCAP.COM
Slide 23: Supplemental Information
Supplemental Information DUBLIN | AMSTERDAM | LOS ANGELES | SHANNON | FORT LAUDERDALE | MIAMI | SINGAPORE | SHANGHAI | ABU DHABI | SEATTLE | TOULOUSE ‘AERCAP.COM
Slide 24: Executed 405 Aircraft Transactions – Full Year 2015
Executed 405 Aircraft Transactions – Full Year 2015 AerCap continues to lease or sell an aircraft on average every 24 hours, consisting of two widebody and five narrowbody aircraft transactions per week 276 46 83 LEASE AIRCRAFT AIRCRAFT AGREEMENTS PURCHASED DISPOSED EXECUTED Sale or part-out: inclu
Slide 25: Aircraft Transactions by Type – Full Year 2015
Aircraft Transactions by Type – Full Year 2015 Aircraft Type Leases Signed Sales Executed Airbus A320 Family 104 22 Airbus A320neo Family 25 - Airbus A330 35 7 Airbus A340 3 5 Boeing 737NG 68 5 Boeing 737Classic 6 12 Boeing 747 3 5 Boeing 757 2 15 Boeing 767 14 3 Boeing 777 6 5 Boeing 787 9 2 Other
Slide 26: Portfolio Management Metrics for Owned Aircraft
Portfolio Management Metrics for Owned Aircraft Lease Portfolio FY 2015 FY 2014 Utilization Rate1 (%) 99.5 99.2 Portfolio Yield2 (%) 13.7 13.5 Average Lease Term (Previous 12 months) 3 • Leases for New Aircraft (Years) 11.4 12.0 4 • Leases for Used Aircraft (Years) 6.1 4.5 Average Remaining Lease Te
Slide 27: AerCap’s Platform Capabilities
AerCap’s Platform Capabilities AerCap has executed 468 leases over the past 18 months, approx. 26 each month 355 narrowbody aircraft leases 113 widebody aircraft leases ~57% extensions1 ~66% extensions1 Airbus A310 Airbus A320 Boeing 787 family 1 15 161 Boeing 737NG Boeing 767 110 19 Airbus A330 49
Slide 28: High Quality and Well Diversified Portfolio
High Quality and Well Diversified Portfolio as of December 31, 2015 Number of Number of Aircraft Type Owned % Net Book Value Managed & Aircraft on Order2 Total Aircraft Aircraft1 AerDragon Aircraft Airbus A319 137 7 11 - 148 Airbus A320 231 15 32 - 263 Airbus A320neo Family - - - 209 209 Airbus
Slide 29: Forward Order & Purchase/Leasebacks as of December 31, 2015
Forward Order & Purchase/Leasebacks as of December 31, 2015 (Unit) 2016 2017 2018 2019 2020 Thereafter Total Airbus A320neo Family 19 48 42 40 40 20 209 Airbus A350 10 11 6 - - - 27 Boeing 737NG 1 - - - - - 1 Boeing 737MAX - - 6 23 25 55 109 Boeing 787 13 17 15 6 - - 51 Embraer E190 / 19
Slide 30: Leasing Expenses
Leasing Expenses ($ million) 4Q 2015 4Q 2014 FY 2015 FY 2014 Default and Restructuring Related 12.6 5.0 47.5 13.8 Normal Transition Costs 19.4 11.2 75.3 35.8 Maintenance Rights Expense 85.0 46.6 348.4 54.5 Lessor Maintenance Contributions 9.1 6.7 37.5 24.5 Other Leasing Costs 0.2 5.3 13.7 13.0 Leasi
Slide 31: AerCap La Touche House IFSC
AerCap La Touche House IFSC Dublin 1, I reland +353 1 819 2010 contact@aercap.com