Willis Lease Finance Corporation · NASDAQ:WLFC
Willis Lease Finance — Corporate Update (May 2024)
21 slides from Willis Lease Finance's corporate update, May 3, 2024
Slide 1: WLFC Company Update
WLFC Company Update May 2024 1
Slide 2: Disclaimer
DISCLAIMER This presentation does not constitute an offer to any person or to the public generally to subscribe for or otherwise acquire any securities. This presentation has been prepared solely for informational purposes and is not intended to serve as the basis for any investment decision. This p
Slide 3: Willis Lease Finance Corporation Investor Presentation
Willis Lease Finance Corporation Investor Presentation We would like to establish a broader dialogue with the institutional investor community ▪ Re-introduce the Company to fundamental investors ▪ Discuss the strengths of aircraft engine leasing ▪ Review Willis’ vertically integrated, differentiated
Slide 4: Willis Lease Finance Corporation's Global Presence
WILLIS LEASE FINANCE CORPORATION’S GLOBAL PRESENCE Strategically positioned to meet customer needs around the world 24/7/365 ~370(1) employees globally positioned to provide “around the clock” service to our international customer base (1) As of April 29, 2024. 4
Slide 5: Our Leadership
OUR LEADERSHIP A seasoned team representing 250+ years of combined industry experience Charles F. Willis, IV Austin C. Willis Brian R. Hole Scott B. Flaherty Dean M. Poulakidas Executive Chairman CEO President EVP & Chief Financial Officer EVP & General Counsel Garry A. Failler Craig W. Welsh Dan J.
Slide 6: The Willis Platform
THE WILLIS PLATFORM A vertically integrated engine lessor providing a service offering which supports the full life - cycle of an aircraft engine ▪ Part 145 Engine Maintenance (US/UK) Business area focused on identifying ▪ Engine & Aircraft Leasing & Trading ▪ Asset Management & Consultancy innovati
Slide 7: Willis Services – Integration & Synergies
WILLIS SERVICES – INTEGRATION & SYNERGIES Vertically integrated wholly -owned subsidiaries MATERIALS ENGINE MAINTENANCE FACILITIES IN US & UK CORE LEASING BUSINESS $2.5B(1) in Assets WLFC ASSET MANAGEMENT & CONSULTING AIRCRAFT MAINTENANCE FACILITY (1) As represented by our portfolio of leased assets
Slide 8: Willis Lease – Innovative Program Offerings
WILLIS LEASE – INNOVATIVE PROGRAM OFFERINGS Air India - 34 CFM56-5B SLB with ConstantThrust® ▪ 5B engine sale-leaseback transaction closed September 2022. ▪ Monthly lease rents and healthy short-term maintenance reserves generating significant monthly cash-flows for the business ▪ Transaction includ
Slide 9: Willis Innovation – A Nascent Effort to Support Aviation Technological Transformation
WILLIS INNOVATION – A NASCENT EFFORT TO SUPPORT AVIATION TECHNOLOGICAL TRANSFORMATION Willis Sustainable Fuels (UK) Limited A dedicated initiative committed to identifying and supporting novel and leading technologies and trends in the aerospace industry. WLFC is committed to developing sustainable
Slide 10: Willis Lease - Engine Leasing Demand Outlook
WILLIS LEASE - ENGINE LEASING DEMAND OUTLOOK Increasing shop visit growth over time is a principal driver of spare engine demand ▪ Industry estimates approximate the total number of spare engines needed at around 10% of the number installed on aircraft ▪ With estimates of around 67,000 engines insta
Slide 11: Willis Lease - Aircraft Engines vs. Aircraft
WILLIS LEASE - AIRCRAFT ENGINES VS. AIRCRAFT Engines exhibit superior value retention, a broader client base with lower individual exposure to a single lessee, and lower volatility across cycles Aircraft Engine Leasing Aircraft Leasing ▪ Limited only by the production of the supported aircraft progr
Slide 12: $2.5BN Portfolio of In-Demand Aircraft Engines
WILLIS LEASE - $2.5BN(1) PORTFOLIO OF IN-DEMAND AIRCRAFT ENGINES WLFC Portfolio Growth (2) $3,000 1,000 900 $2,500 800 A constantly Qty. Owned and Managed Assets 700 The largest $2,000 managed/optimized independent 600 portfolio meeting rising portfolio of market demand in the Book Value ($000’s) $1
Slide 13: Attractive Portfolio of High-Quality Assets
ATTRACTIVE PORTFOLIO OF HIGH-QUALITY ASSETS Diversified current generation, in-demand narrowbody aircraft engine portfolio producing a consistent global lease revenue stream Portfolio Asset Composition(1) Lease Rental Revenue by Region(2) 0% 3% 6% 21% 46% $2.5Bn(1) 54% $213MM 37% 33% Narrowbody Wide
Slide 14: Willis Lease - Focus on Engine Types and Host Aircraft
WILLIS LEASE - FOCUS ON ENGINE TYPES AND HOST AIRCRAFT A diverse portfolio of engines supporting current aircraft fleets worldwide with continuous & active management keeping the portfolio in line with the latest industry standards WLFC portfolio evolution over last 18 years 35% 30% 25% 20% 15% 10%
Slide 15: Markets Undervalue Engine Portfolios
WILLIS LEASE – MARKETS UNDERVALUE ENGINE PORTFOLIOS WLFC Portfolio NBV vs. Market Value A unique portfolio of primarily narrow body aircraft engines with ~$400MM of unrecognized value! A growing portfolio of New Technology engines is significantly undervalued by the equity markets … Note: Appraisals
Slide 16: Historical Financial Results
HISTORICAL FINANCIAL RESULTS(1) WLFC Portfolio and Utilization Growth Drives Year-over-Year Top Line Growth 2023 industry dynamics supported all-time core Lease and Maintenance Revenue growth WLFC is positioned to enjoy solid engine leasing industry dynamics for the foreseeable future … (1) Actuals
Slide 17: Q1 2024 Financial Results
Q1 2024 FINANCIAL RESULTS(1) Quarter over Quarter ▪ Record results reported in Q1-2024! ▪ Lease and maintenance reserve revenues, indicative of an extremely active fleet, driving core profitability ▪ $29.9MM of record quarterly EBT (1) Actuals derived from WLFC’s Form 10-Q filings. EBITDA defined as
Slide 18: A Broad Capital Base with Diverse, Global Resources
A BROAD CAPITAL BASE WITH DIVERSE, GLOBAL RESOURCES Proven access to debt capital markets with a large pool of reliable banks Willis Lease(1) $708 Million Structured $50 Million Other $40.4 Million Revolving Credit Debt Preferred Discrete JOLCO Facility Equity Borrowings Financings $199 Million $241
Slide 19: Leverage Trends
Leverage Trends Total Debt to Equity (1)(2) Historical Leverage 2,000,000 5.00 1,750,000 4.62 Strong, continuous 4.50 profitability building 4.36 1,500,000 4.25 4.22 4.25 balance sheet equity 4.12 4.10 4.06 4.00 1,250,000 3.94 Business de-levering 3.74 3.69 through significant 1,000,000 3.50 operati
Slide 20: Key Operational Performance Indicators
KEY OPERATIONAL PERFORMANCE INDICATORS Portfolio quality supports strong and resilient performance across cycles Very Resilient Utilization(1) Trends 95% 93% 93% 91% 91% 90% 90% 89% 89% 90% 89% 88% 87% 86% 86% 87% 85% 82% 83% 84% 83% 84% 81% 82% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Slide 21: Willis Lease - Diverse Customer Base
WILLIS LEASE - DIVERSE CUSTOMER BASE Long-standing relationships with the world’s biggest companies in over 120 countries 21