Aercap Holdings N.v. · NYSE:AER
Aercap — Investor Day (September 2015)
85 slides from Aercap's investor day presentation, Sep 10, 2015
Slide 1: 2015 Investor Day
September 10, 2015, New York 2015 Investor Day 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 with respect to future performance and events. These statements, estimates and forecasts are “forward-looking statements”. In some cases, forward- looking statements can b
Slide 3: Agenda
Agenda | Introduction John Wikoff Head of Investor Relations | AerCap Overview Aengus Kelly Chief Executive Officer | Leasing Strategy Philip Scruggs President & Chief Commercial Officer | Portfolio Management Edward O’Byrne Chief Investment Officer | Q&A and Break 3 #
Slide 4: Agenda
Agenda | Risk Management Anton Joiner Chief Risk Officer Martin Olson | OEM Relations Head of OEM Relations Keith Helming | Financial Performance Chief Financial Officer | Q&A | Summary and Closing Aengus Kelly Chief Executive Officer 4 #
Slide 5: AerCap Overview
AerCap Overview Aengus Kelly Chief Executive Officer 5 #
Slide 6: AerCap Investor Day – Key Takeaways
AerCap Investor Day – Key Takeaways Aircraft leasing is a stable and profitable business with tremendous growth opportunities • More people will travel each year than did in the previous year for the foreseeable future A well-managed aircraft portfolio will generate stable and durable cash flows ove
Slide 7: A Legacy of Growth and Innovation
A Legacy of Growth and Innovation AerCap has continued its expansion over the years with deep roots in the industry Emergence of Industry Leadership Formation of “New” AerCap • ILFC places landmark order for • debis AirFinance acquires AerFi Airbus and Boeing aircraft • Cerberus acquires debis AirFi
Slide 8: AerCap's Consistent Profitability
AerCap’s Consistent Profitability Since 2007 AerCap has grown its assets ten-fold with consistent 12% annual average EPS1 growth through all economic cycles ($ billion) Oil Financial European Ebola/Russian (%) Crisis Crisis Crisis Crisis 45 10x 12 Asset Increase 40 10 Historical Average 35 9.6% Aver
Slide 9: Then and Now
Then and Now Since the 2013 Investor Day, AerCap has transformed into the leading global lessor 1 1 2015 2013 Change Equity $7.8B $2.4B 3.2x Net income $1.3B 2 $0.3B 4.3x Total revenue $5.2B 2 $1.1B 4.7x AerCap has surpassed all Assets $44.1B $9.5B 4.6x financial and integration 3 targets set in adv
Slide 10: AerCap's Business Principles
AerCap’s Business Principles AerCap’s operating strategy will remain focused on our key business principles Leasing Strategy Capital Structure • Highly diversified customer base • Focus on long-term funding to match fund • Wide geographical coverage long-term assets • Security deposits and maintenan
Slide 11: Industry Overview
Industry Overview Aircraft leasing has a strong track record and has been on a robust growth path Healthy and balanced global Lessors expected to continue Half of world airline fleet demand for existing and new to be responsible for funding expected to be leased by 2020, aircraft, with air traffic e
Slide 12: Increasing Demand for Operating Leases
Increasing Demand for Operating Leases Over the past 20 years the world fleet DOUBLED while the operating lease fleet size multiplied by FOUR PROPORTION OF GLOBAL LEASING REPRESENTS A SIGNIFICANT FLEET ON OPERATING LEASE1 SHARE OF MAJOR AIRLINES’ FLEET2 20,000 80% % leased 93% 18,000 16,866 70% Virg
Slide 13: Air Travel Growth
Air Travel Growth Resilient, growing air travel market expected to continue WORLD ANNUAL TRAFFIC (RPKs – trillions)1 ROBUST GLOBAL TRAFFIC Financial/ Oil Oil Gulf Asian Euro Russian 85% world traffic RPK Crisis Crisis Crisis Crisis 9/11 SARS Crisis Crisis increase since 9/11 despite 7.0 the differen
Slide 14: Competitive Industry Landscape
Competitive Industry Landscape AerCap’s scale and orderbook provide a key competitive advantage LEASING MARKET SHARE $30+ BILLION1 by fleet size1 1,6761 1,6091 40%31% SMBC Aviation Capital Air Lease Corporation 5991 5751 $5-12 BILLION1 34% UNDER $5 BILLION1 26% This is only a selected group of lesso
Slide 15: Objectives for the Future
Objectives for the Future Our ultimate objective is to make money for our shareholders CUSTOMER TARGETS OPERATIONAL TARGETS HAVE THE AIRCRAFT MAINTAIN THE TECHNICAL CUSTOMERS WANT VALUE OF THE FLEET Keep aircraft portfolio at the Monitor maintenance and record forefront of our thinking keeping to pr
Slide 16: Disciplined Focus on Managing Business
Disciplined Focus on Managing Business AerCap takes a holistic approach to enhancing shareholder value • Key drivers of shareholder return include: • Forward Orders • Sale Lease-Back • Portfolio Acquisition (M&A) Forward Sale • Share Repurchase/Dividend Orders Lease-Back • New orders to drive ~5% pe
Slide 17: Leasing Strategy
Leasing Strategy Philip Scruggs President & Chief Commercial Officer 17 #
Slide 18: Global Customer Base
Global Customer Base A diverse global network of more than 200 customers in ~90 countries LESSEE DIVERSIFICATION SELECT TOP AIRLINE CUSTOMERS NORTH AMERICA / ASIA / PACIFIC CARIBBEAN & RUSSIA 1 14% of YTD 2015 EUROPE 35% of YTD 20151 lease revenues 32% of YTD 20151 lease revenues lease revenues Unit
Slide 19: Long-Standing Strong Customers
The Foundation of Our Business Long-Standing Strong Customers Stable, Dependable Cash Flow 19 #
Slide 20: Largest Lessor Partner to Airlines Worldwide
Largest Lessor Partner to Airlines Worldwide Long-standing, strong customer relationships Years of Number of AerCap Lessor Years of Number of AerCap Lessor Customer Customer Relationship Aircraft Market Position1 Relationship Aircraft Market Position1 27 88 #1 24 38 #1 21 54 #1 23 44 #1 21 53 #1 27
Slide 21: Global Leader in Leasing
Global Leader in Leasing Scale has its advantages NUMBER OF AIRCRAFT IN SERVICE / FIRM ORDER1 COMPETITIVE ADVANTAGES OF SCALE 1,751 1,735 Order book • Ability to enter into large, sophisticated, and In-service strategic aircraft transactions • Favorable terms from manufacturers • Diversified aircraf
Slide 22: Vision, Reach, Scale - The AerCap Advantage
Vision, Reach, Scale - The AerCap Advantage The Vision to see the The Reach to build and The Scale to move whole world maintain relationships aircraft around the globe with airlines across the and create unique globe solutions for customers VISION: GROWING IN VACUUM 13 A330-200s OF IBERIA RETREAT Mo
Slide 23: The AerCap Advantage Drives Superior Results
The AerCap Advantage Drives Superior Results Moving capacity to maximize long-term shareholder value 5x Transaero 27 737-700s placed with 8x China Southwest Eastern 4x China Southern Moving aircraft from 3 continents and 10x 4 airlines to match worldwide capacity demand with aircraft supply Aeroline
Slide 24: The AerCap Advantage Differentiates Us from Competitors
The AerCap Advantage Differentiates Us from Competitors Vision, reach and scale to do transactions others cannot do 25x A319-100s 24x 4x 777-200ERs A320neos 17x A319-100s 25x A319-100s 4x 777-200ERs 17x A319-100s 24 #
Slide 25: Leasing Shapes Global Capacity
Leasing Shapes Global Capacity Aircraft leasing is the mechanism by which the market quickly and efficiently distributes capacity around the world AerCap does it better than others 25 #
Slide 26: AerCap's Platform Capabilities
AerCap’s Platform Capabilities AerCap has executed 361 lease transactions over the past 12 months 279 NARROW BODY AIRCRAFT 82 WIDE BODY AIRCRAFT LEASE TRANSACTIONS LEASE TRANSACTIONS ~53% extensions1 ~69% extensions1 787 9 A320 family 115 737NG 99 767 12 A330 37 777 7 747 A320neo family Other 51 14
Slide 27: The System Matters
The System Matters A well-synchronized organization delivers superior performance • Local, self-sufficient, regional offices with Leasing, Pricing, Technical, Legal, Risk, and Portfolio Management functions that allow us to touch the customer, efficiently manage the business and drive consistent pro
Slide 28: ...And the Results Are Clear
...And the Results Are Clear AerCap’s placement of NEOs is outpacing the market % OF A320NEO BACKLOG LEASED OPEN A320NEO POSITIONS 100% 200 180 80% 160 140 60% 120 100 40% 80 60 20% 40 20 0% 0 2016 2017 2018 2019 Total 2016 2017 2018 2019 AerCap Others AerCap Others 83 aircraft leased by AerCap thro
Slide 29: Stable Profits for Shareholders
Stable Profits for Shareholders 99.3% UTILIZATION RATE1 (1) For the twelve months ended June 30, 2015 29 #
Slide 30: China
0 AERCAP a Aviation Solutions China AERCAP.COM
Slide 31: AerCap in China
AerCap in China China represents ~10% of AerCap’s aircraft portfolio1 137 OWNED AIRCRAFT2 CHINA PORTFOLIO PROFILE A319 Other 32 18% China 737-800 Southern 82% of the 52 Air China 43% company’s China 15% exposure is with the “Big 3” China Eastern 24% A320 Current Installed Fleet 137 18 Planned Return
Slide 32: Traffic Continues to Grow
Traffic Continues to Grow Despite the decline in GDP growth over the past 5 years from 9.5% to 7%, traffic growth has accelerated from 10.9% to 12.3% 14% 12.3% 12% 10.9% 10% 9.5% 8% 7.0% 6% 4% 2% 0% 2011 2012 2013 2014 1H 2015 Real GDP growth China Domestic traffic growth y/y China P.R. (RPK) Fleet
Slide 33: China Has a Conservative Backlog
China Has a Conservative Backlog China’s conservative delivery commitments leave a gap for the leasing community to fulfill aircraft requirements 18% 16% Over 700 additional aircraft required at conservative growth levels 14% 12% 10% 13% 4.7% 13% 10% 5.8% 8% 11% 10% 8.0% 7.9% 6% 4.6% 4% 2.9% 0.4% 0.
Slide 34: Portfolio Management
Portfolio Management Edward O’Byrne Chief Investment Officer 34 #
Slide 35: Portfolio Management
Portfolio Management Discipline enables sustainable superior returns FUNCTIONS KEY GOALS RESULTS Aircraft Acquisition: Liquid portfolio of Industry-leading Forward Orders, Purchase in-demand assets orderbook & Lease-Backs Residual Value Consistent Trading & Aircraft Disposition: Management Gains on
Slide 36: Perspectives on Aircraft Liquidity
Perspectives on Aircraft Liquidity AerCap focuses its fleet on the most liquid aircraft types today and invests in the most in-demand aircraft for tomorrow Strong A320neo 737NG 737 MAX A320 family 777 A350 787 A330 A330neo 777X Invest/Divest cycles are E-Jets E2 Outlook driven by technology E-Jets a
Slide 37: Decades-Long Technology Cycles
Decades-Long Technology Cycles Slow technology obsolescence makes for stable residuals Life Cycle Life Cycle Peak Fleet Start End Retirement Duration Airbus A320 1988 2018 ~2045 57 Years 7,000 Boeing 737NG 1997 2019 ~2045 48 Years 6,660 (Jurassic 1967) Airbus A330 1993 2018 ~2040 47 Years 1,250 Boei
Slide 38: Portfolio Today and Tomorrow
Portfolio Today and Tomorrow Over the next 5 years, aircraft portfolio will grow by over 20% and consist of ~50% new technology assets 2015 PORTFOLIO 2020 PORTFOLIO Fleet: 1,130 / Value: ~$37B Fleet: 1,260 / Value: ~$45B Old Tech 787 Old Tech 737 MAX $2.1B $2.8B ~$0.3B ~$1.0-2.0B 737NG ~$7.4B A330 7
Slide 39: Investors in Aircraft Transactions
Investors in Aircraft Transactions AerCap executes transactions in all segments of the aircraft trading market % OF AIRCRAFT VALUE SOLD DURING THE LAST 18 MONTHS1 Aircraft Age Investor Segment • Aircraft Sales at Lease End Over 25 • Part-Out 25+ YEARS 18% • Hedge Fund High Yield Desks 15 – 25 • Spec
Slide 40: New Investors Attracted to Aircraft Assets
New Investors Attracted to Aircraft Assets Aircraft assets offer a wide array of risk/reward alternatives to satisfy different investment strategies PRINCIPAL FACTORS DRIVING AIRCRAFT INVESTMENT Attractive Investment Robust Industry Profile Fundamentals • High cash yield • Passenger traffic growth •
Slide 41: Aircraft Trading and Portfolio Results
Aircraft Trading and Portfolio Results AerCap has one of the world’s most active aircraft trading team 393 AIRCRAFT SOLD AND PARTED-OUT SINCE 2006 ACQUISITIONS 90 • 5-6% committed CapEx Growth yearly 80 • 50%+ of Balance Sheet in New Technology by 2020 70 AIRCRAFT TRADING 60 • ~400 aircraft sold; Pr
Slide 42: Q&A
Q&A Aengus Kelly Philip Scruggs Edward O’Byrne Chief Executive Officer President & Chief Chief Investment Officer Commercial Officer 42 #
Slide 43: AerCap Investor Day 2015 - Session Break
AerCap Investor Day 2015 - Session Break 43 #
Slide 44: Risk Management
Risk Management Anton Joiner Chief Risk Officer 44 #
Slide 45: Risk Management at Center of Operations
Risk Management at Center of Operations Focus on key business exercise of counterparty monitoring, getting paid, workout and repossession ROBUST RISK MANAGEMENT PHILOSOPHY LEASING EMBEDDED ACROSS THE ORGANIZATION • Shape customer leasing campaigns • Influencing transaction size, terms & conditions a
Slide 46: Robust Risk Management Procedures
Robust Risk Management Procedures Multi-disciplinary approach to customer credit management WORKOUT/ LESSEE DILIGENCE WATCHLIST REPOSSESSION • Thorough customer diligence • Derived from risk scoring, • Preparedness and action plan at LOI stage payment/technical performance are key determinants of Lo
Slide 47: Principal Lessor Credit Protections
Principal Lessor Credit Protections Lease standards have been refined over several decades and continue to be shaped with experience across industry cycles TOOLS AVAILABLE Restriction “Hell or high FOR ADDITIONAL Advance on removal rentals water” payment ENHANCEMENT of parts clause Full Ability to L
Slide 48: AerCap Portfolio
AerCap Portfolio Portfolio content heavily weighted towards industry leaders Flag Dominant Diverse • Top 10 airlines have $172 billion in annual Customer % Rent1 Carrier Position Operations revenues in 2014 6.7 ✔ ✔ ✔ • All airlines have dominant market positions either outright, with equity partners
Slide 49: Routine Monitoring – Recent Results
Routine Monitoring – Recent Results Strong underlying lessee credit quality • Comprehensive financial review of portfolio FINANCIAL METRIC COMPARISON1 completed in August % Weight AerCap Weighted Moody’s Metric • 158 airlines modeled using 2014 audited financials Moody’s Portfolio (by NBV) Equivalen
Slide 50: Watchlist Management
Watchlist Management Aged balances have been significantly reduced since the ILFC integration $50m ESCALATING FOCUS ON DELINQUENCIES • Departments to escalate: Contracts, Leasing, Risk & Legal $25m • All cross-department leasing workflows influenced by payment performance • Visual aids in offices to
Slide 51: Repossession Management
Repossession Management AerCap has ALWAYS been successful in repossessing aircraft Embedded Ability to act organizational quickly and mind-set to act globally assertively Repossessions and AerCap’s proven ability KEY unscheduled returns are on repossession has DETERMINANT not everyday occurrences, u
Slide 52: Yemenia Repossession
Yemenia Repossession AerCap took quick action to secure its two A330-200s on lease to Yemenia upon escalation of Saudi conflict FOUR WEEKS: MARCH 26 – APRIL 24 • AerCap leased two A330-200s and one spare engine to Yemenia, national carrier of Yemen • Conflict began March 26; borders, airspace quickl
Slide 53: Russia – An Important and Performing Market
Russia – An Important and Performing Market Sector distress presented certain challenges, but it remains an important market - we have and will take action as necessary MARKET CONDITIONS AERCAP’S RESPONSE • Devaluing rouble has increased dollar costs • Only 1 out of a fleet of 110 aircraft forcibly
Slide 54: OEM Relations
OEM Relations Martin Olson Head of OEM Relations 54 #
Slide 55: AerCap-OEM Relationship
AerCap-OEM Relationship AerCap is a significant and growing part of the OEM backlog DELIVERIES FROM OEMs SINCE 19951 • The global fleet under an operating lease 1,213 increased from 12% in 1990 to 42% in 20142 • Trend likely to continue to 50% by 2020 • Lessors are increasingly important to OEMs 852
Slide 56: OEM Backlog Management
OEM Backlog Management Effective OEM backlog management reduces asset volatility for new aircraft AIRCRAFT DELIVERIES – RESILIENCE1 • OEM sophisticated approach to order cycle management Gulf Crisis 9/11 Financial Crisis rooted in past experience 1,300 • Backlog representing ~9 1,200 years at curren
Slide 57: Customer Diversification
Customer Diversification Increased levels of customer diversification and maturation of LCCs LCC CAPACITY SHARE (%) OF TOTAL SEATS1 • Market liberalization and significant growth of 30 Low Cost Carriers (LCCs)2 2013 25.0% 25.6% • Increase in LCCs flying short-haul flights 25 under 3,000 miles from 1
Slide 58: Market Diversification
Market Diversification Increased levels of market diversification and reduced market volatility WORLD TO TAKE DELIVERY OF OVER 38,000 AIRCRAFT IN NEXT 20 YEARS2 • More than 38,000 aircraft expected to be Deliveries 1 Deliveries 2 % Growth delivered over the next 20 years (1994-2014) (2015-2034) • Mo
Slide 59: Forward Order Considerations
Forward Order Considerations When placing aircraft orders, several considerations factor into decision-making Order Size Credits Flexibility Escalation Considerations underpinning AerCap’s Engines disciplined approach to Advanced Technology order placement Liquidity Performance Value creation throug
Slide 60: Best Orderbook in the Industry
Best Orderbook in the Industry AerCap well positioned to meet current and future demand AVERAGE OF ~61 NEW AIRCRAFT DELIVERIES PER YEAR (2015-2022) • Focus on keeping 82 79 77 orderbook fresh and 5 14 liquid 14 66 5 62 • Diverse mix of Airbus and 24 Boeing aircraft to meet 14 25 customer demand 46 •
Slide 61: Orderbook Highlights
Orderbook Highlights Top customer across all modern technology aircraft Airbus A350 Boeing 787 Airbus A320neo • 1st lessor delivery • Largest lessor customer • 2nd largest lessor customer • Largest lessor customer • World’s 2nd overall customer • World’s 3rd overall customer Boeing 737 MAX Embraer J
Slide 62: Financial Performance
Financial Performance Keith Helming Chief Financial Officer 62 #
Slide 63: Consistent Margins
Consistent Margins Since 2007, AerCap has grown its assets ten-fold with consistent 12% annual average EPS1 growth through all economic cycles ($ billion) Oil Financial European Ebola/Russian 45 (%) Crisis Crisis Crisis Crisis 12 40 10 35 9.6% Average NIM Historical Average 30 8 25 6 20 Historical A
Slide 64: Consistent Fleet Utilization
Consistent Fleet Utilization AerCap has achieved stable fleet utilization through all economic cycles Oil Financial European Ebola/Russian Crisis Crisis Crisis Crisis Maximum → 99.5% 45 100% 40 98% Minimum → 97.7% 96% 35 94% 1.8% 30 10-year range Total Assets ($ billion) 92% Utilization Rate 25 90%
Slide 65: Consistent Generation of Gains on Sales
Consistent Generation of Gains on Sales Proven track record of active portfolio management with 280 owned aircraft sold since 2006 (393 incl. managed aircraft) ($ million) 120 30% Net Gain on Sales 27% Margin 100 $103 25% 24% $88 80 20% $81 $77 ~13% 17% 16% average margin on 16% 60 sales/part-outs1
Slide 66: Limited Impact from Defaults
Limited Impact from Defaults Impact for defaults and restructuring have averaged less than 1% of lease revenue since 2010 10% 4.3% Historical Average 1.1% 0.4% 1.5% ~0.8% 0% historical (2.3%) (0.5%) average -10% 2010 2011 2012 2013 2014 1H 2015 The accounting for default costs is as follows: • Maint
Slide 67: Consistent Outperformance vs. Bank Returns
Consistent Outperformance vs. Bank Returns Since 2007, AerCap’s ROE outperformed major banks1 by 9.5% on average 25% Oil Financial European Ebola/Russian Crisis Crisis Crisis Crisis 20% 13.3% AerCap AerCap 15% ROE Historical Average 10% Major Banks ROE 5% Historical Average 0% 2007 2008 2009 2010 20
Slide 68: Specific Financial Topics
Specific Financial Topics 68 #
Slide 69: Interest Rate Management
Interest Rate Management Risk from rising interest rates is essentially hedged Floating Rate 24% Leases, Cash, & Other Interest Rate 100bps increase in interest rates 6% Caps & Swaps would have a negative impact of ~$30 million per annum Fixed Rate Debt 70% Primarily driven by the difference between
Slide 70: Aircraft Portfolio Valuation As of March 31, 2015
Aircraft Portfolio Valuation As of March 31, 2015 Carrying value of assets compares favorably with third-party appraisals VALUE PER SHARE 1 ($ billion) Carrying Value $60 ~$55 Flight Equipment 33.0 $50 ~$15 ~$15 Maintenance Rights Intangible 3.7 $40 Maintenance Liability (3.2) $30 $20 ~$40 ~$40 Net
Slide 71: Russia Net Exposure
Russia Net Exposure AerCap continues to monitor market conditions CURRENT NET EXPOSURE FORECASTED NET EXPOSURE PLANNED ACTIONS A330s 110 (18) 24% 92 Aeroflot / S7 Other A320 Family Aircraft 54% 46% Aircraft B737-800 Aircraft • (5) Re-leases under LOI 55% Other 21% • (1) Contracted Sale • (12) Planne
Slide 72: Guidance
0 AERCAP a Aviation Solutions Guidance AERCAP.COM
Slide 73: Contracted Portfolio Growth
Contracted Portfolio Growth Portfolio growth expected to be ~5-6% based on contracted purchases before use of excess capital $44B ~5% expected growth $41B per annum to 2017 $38B and ~6% to 2018 $37B Contracted Purchases • 2016 = ~$5 billion • 2017 = ~$6 billion • 2018 = ~$6 billion Depreciation Run
Slide 74: Portfolio Yields and Depreciation
Portfolio Yields and Depreciation Portfolio yield / depreciation expected to be relatively stable in coming years 2015 2016 2017 2018 Weighted Average Age1 7.7 7.7 7.4 6.9 Estimated Yield2 (%) 12.7 12.5 12.3 12.0 Estimated Depreciation Rate3 (%) 5.7 5.6 5.5 5.2 Estimated Net Impact (%) 7.0 6.9 6.8 6
Slide 75: Maintenance Contribution
Maintenance Contribution Net maintenance contribution expected to be $0.10 - $0.15 billion in coming years ($ billion) 2015 2016-2018 Estimated Maintenance Income 0.25 Estimated Lease Expense 0.15 Estimated Net Maintenance Contribution1 0.10 0.10-0.16 Maintenance Contribution Yield (%) 0.27 0.37 (1)
Slide 76: Other Expense Items
Other Expense Items Modest variation in other expense items through 2018 2015 2016 2017 2018 Interest Rate (%)1 3.6 3.8 4.0 4.0 SG&A ($ billion)2 0.4 0.4 0.4 0.4 Tax Rate (%) 13.5 12.5-13.0 12.5-13.0 12.5-13.0 (1) Based on current market rates, increase in cost is equal to ~30bps of average leased a
Slide 77: Rapid Deleveraging
Rapid Deleveraging Debt/Equity ratio expected to be 3.0x at year end 2015; Excess capital of ~$500m+ expected to be generated per annum1 5.5x 5.3x Original Forecast 5.0x 4.8x Current Forecast 4.6x Actual 4.4x 4.5x 4.2x 4.0x 4.0x 3.9x 3.8x 3.5x ~2.7x - 3.0x 3.4x Targeted debt/equity range 3.0x 3.2x 3
Slide 78: Use of Expected Excess Capital
Use of Expected Excess Capital Combination of additional aircraft purchases and return of capital expected EXCESS CAPITAL OF ~$1.5+ billion GENERATED 2016 THROUGH 2018 IF USED FOR AIRCRAFT PURCHASES IF USED FOR SHARE REPURCHASES NUMBER OF SHARES THAT CAN BE COULD RESULT IN ADDITIONAL AIRCRAFT LEASE
Slide 79: Targeted Earnings Per Share Growth
Targeted Earnings Per Share Growth ~7-9% EPS growth per annum driven by contracted growth and use of excess capital1 (%) 11 10 9 8 ~5% ~(2%)-(3%) ~7-9% 7 6 ~5-6% 5 4 3 2 1 0 Contracted Growth CAGR Use of Excess Capital Interest Expense / Other EPS CAGR (1) Earnings per Share growth from 2016 to 2018
Slide 80: Maintenance Rights Asset
Maintenance Rights Asset Accounting for maintenance rights asset results in accelerated depreciation of aircraft values ($ billion) 2014 2015 2016 2017 2018+ Total1 Depreciation Adjustment (0.17) (0.25) (0.25) (0.25) (2.06) (2.98) Leasing Expenses Adjustment 0.06 0.42 0.48 0.30 1.72 2.98 Net Pre-Tax
Slide 81: Q&A
Q&A Anton Joiner Martin Olson Keith Helming Chief Risk Officer Head of OEM Relations Chief Financial Officer 81 #
Slide 82: Summary and Closing
Summary and Closing Aengus Kelly Chief Executive Officer 82 #
Slide 83: AerCap Investment Case
AerCap Investment Case Today AerCap is the largest and most profitable aircraft lessor Strong and resilient industry fundamentals Industry leading earnings delivering shareholder value Proven track record of rapid deleveraging Efficient and scalable platform Strong growth profile Hedging strategies
Slide 84: Thank you
0 AERCAP Aviation Solutions AERCAP.COM
Slide 85: Head Office, AerCap House
Head Office, AerCap House Stationsplein 965 1117 CE Schiphol, The Netherlands +31 20 655 9655 contact@aercap.com 85 #