Aercap Holdings N.v. · NYSE:AER
Aercap — Q2 2015 Earnings Presentation
26 slides from Aercap's earnings presentation, Aug 11, 2015
Slide 1: Second Quarter 2015 Financial Results
August 11, 2015 Second Quarter 2015 Financial Results 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: AerCap Investment Case
AerCap Investment Case Strong and resilient industry fundamentals Substantial and predictable cash flows Proven track record of rapid deleveraging Efficient and scalable platform Industry’s most attractive order book Portfolio and hedging strategies to mitigate risk Experienced management team with
Slide 4: Financial Results and Highlights
Financial Results and Highlights Highlights • 132 aircraft transactions executed ADJUSTED NET INCOME • 99.1% fleet utilization rate • $361.1 million for 2Q 2015 • 6.0 years of average remaining contracted lease term ($309.1 million reported) as of June 30, 2015 • $665.7 million for 1H 2015 • 461 new
Slide 5: Net Income
Net Income ($ million) 2Q 2015 2Q 2014 1H 2015 1H 2014 Reported Net Income1 309.1 123.7 620.6 178.4 Adjusted for: • Mark-to-market on interest rate caps 0.1 5.7 6.7 10.0 and swaps, net of tax • Transaction and integration related 1.0 88.4 4.8 107.2 expenses, net of tax • Maintenance rights related e
Slide 6: Basic Earnings Per Share
Basic Earnings Per Share ($) 2Q 2015 2Q 2014 1H 2015 1H 2014 Reported Earnings Per Share1 1.48 0.75 2.95 1.28 Adjusted for: • Mark-to-market on interest rate caps and swaps, transaction and integration related expenses and 0.25 0.39 0.21 0.62 maintenance rights related expenses, all net of tax Adjus
Slide 7: Maintenance Rights: 2Q 2015 Adjustment
Maintenance Rights: 2Q 2015 Adjustment ($ million) Reported Amount Adjusted Amount Adjustment Depreciation (459) (527) (68) Lease Expense (173) (47) 126 Pre-Tax Earnings Impact 58 Net Income Impact 51 • As a result of the purchase accounting, a portion of the acquired ILFC aircraft value is classifi
Slide 8: Revenues and Other Income
Revenues and Other Income ($ million) 2Q 2015 2Q 2014 Basic Lease Rents1 1,164.6 716.7 Maintenance Rents and Other Receipts1 69.7 29.0 Net Gain (Loss) on Sale of Assets 54.6 (0.9) Other Income2 48.6 44.4 Total Revenues and Other Income 1,337.5 789.2 (1) Year-over-year increase in Basic Lease Rents a
Slide 9: Net Interest Margin (Net Spread)
Net Interest Margin (Net Spread) ($ million) 2Q 2015 2Q 2014 Net Interest Margin (Net Spread)1 909.7 551.5 Average Leased Assets2 36,633 22,503 Annualized Net Spread % 9.9% 9.8% (1) Net Interest Margin calculated as basic lease rents less interest expense, excluding the non-cash charges related to t
Slide 10: AerCap’s Consistent Profitability
AerCap’s Consistent Profitability 50 ($ billion) Oil Financial Euro Ebola/Russian Crisis Crisis Crisis Crisis 45 10x 12% Asset Increase 40 10% 35 9.6% Historical Average Avg. NIM 30 8% 25 6% 20 4.2% 4% 15 Avg. NIM less Historical Average Depreciation 10 2% 5 0% 0 2007 2008 2009 2010 2011 2012 2013 2
Slide 11: Aircraft Disposals and Purchases
Aircraft Disposals and Purchases ($ million) 2Q 2015 2Q 2014 Pre-Tax Gain (Loss) from Aircraft Sales 54.6 (0.9) 2Q 2015 Disposal Activity: • 13 aircraft were sold and 1 aircraft was parted-out from our owned portfolio: • 2 Airbus A321-200s, 2 Airbus A319-100s • 6 Boeing 757-200s, 1 Boeing 767-300ER,
Slide 12: Other Expenses and Taxes
Other Expenses and Taxes ($ million) 2Q 2015 2Q 2014 Leasing1 173.4 22.6 SG&A 91.5 63.3 Impairment2 2.7 0.3 Transaction and Integration Related3 1.1 101.0 YTD 2015 FY 2014 Blended Tax Rate4 13.5% 15.0% (1) 2Q 2015 leasing expenses include $126.1 million in maintenance rights expenses (2) 2Q 2015 imp
Slide 13: Cash
Cash ($ million) 2Q 2015 2Q 2014 Cash and Cash Equivalents as of June 30, 2015 1,568.3 1,731.4 (excl. restricted cash) Total Cash Balance as of June 30, 2015 1,947.9 2,530.3 (incl. restricted cash) Operating Cash Flow for 2Q 849.2 439.3 Annual run-rate for operating cash flow is over $3.0 billion
Slide 14: Liquidity Position as of June 30, 2015
Liquidity Position as of June 30, 2015 Sources (for 12 months to June 30, 2016) ($ billion) Unsecured Revolver 3.0 Other Undrawn Commitments 1.5 Sources do not include or assume additional AIG Revolver 0.5 financing for deliveries Unrestricted Cash 1.6 of new aircraft Total Available Liquidity 6.6 p
Slide 15: Capital Structure
Capital Structure Summary 2Q 2015 2Q 2014 Average Cost of Debt (including all fees)1 3.5% 3.5% Debt / Equity Ratio 3.3 to 1 3.8 to 1 Debt/Equity Calculation ($ million) 2Q 2015 2Q 2014 Debt at Quarter-End (incl. fair value adjustments) 30,682 31,341 Adjusted for: • Unrestricted cash & cash equivalen
Slide 16: Financial Outlook
6 AERCAP é Aviation Solutions Financial Outlook AERCAP.COM
Slide 17: Financial Outlook for 2015: Adjusted Income
Financial Outlook for 2015: Adjusted Income Previous Revised ($ billion) Adjusted Income Update Adjusted Income Total Revenue ~5.00-5.10 - ~5.05 Gain on Sales in 1H 20151 ~0.03 ~0.06 ~0.09 Depreciation ~(2.10) - ~(2.10) Interest Expense ~(1.10) - ~(1.10) Lease Expense, SG&A & Other ~(0.60) ~0.10 ~(0
Slide 18: Q&A
6 AERCAP é Aviation Solutions Q&A AERCAP.COM
Slide 19: Supplemental Information
Supplemental Information 19
Slide 20: Aircraft Transactions: 2Q 2015
Aircraft Transactions: 2Q 2015 103 11 18 LEASE AIRCRAFT AIRCRAFT AGREEMENTS PURCHASED DISPOSED EXECUTED Sale or part-out: 14 from our owned portfolio and 4 from our managed portfolio AerCap continues to buy, sell or lease more than one aircraft every 24 hours, providing us with unrivalled market kno
Slide 21: Portfolio Management Metrics for Owned Aircraft
Portfolio Management Metrics for Owned Aircraft Lease Portfolio 2Q 2015 2Q 2014 Utilization Rate1 (%) 99.1 98.8 Portfolio Yield2 (%) 13.5 13.3 Average Lease Term (Previous 12 months) • Leases for New Aircraft (Years) 11.8 3 12.9 • Leases for Used Aircraft (Years) 5.6 4 4.6 (1) Utilization rate weigh
Slide 22: AerCap’s Platform Capabilities
AerCap’s Platform Capabilities 368 narrow-body aircraft leases 116 wide-body aircraft leases ~57% extensions1 ~67% extensions1 Boeing 787 17 Boeing 737NG Airbus A320 124 family Airbus A330 Boeing 767 155 51 16 Boeing 777 10 Other 22 Boeing 747 Airbus 5 Airbus A350 Airbus A340 A320neo family 9 8 67 A
Slide 23: High Quality and Well Diversified Portfolio as of June 30, 2015
High Quality and Well Diversified Portfolio as of June 30, 2015 Number of Number of Aircraft Type % Net Book Value Managed & Aircraft on Order2 Total Aircraft Owned Aircraft1 AerDragon Aircraft Airbus A319 140 7 11 - 151 Airbus A320 236 15 30 - 266 Airbus A320 / A321neo - - - 205 205 Airbus A321 99
Slide 24: Forward Order and Purchase/Leasebacks as of June 30, 2015
Forward Order and Purchase/Leasebacks as of June 30, 2015 Remaining Unit1 2016 2017 2018 2019 Thereafter Total 2015 Airbus A320 / A321neo 1 21 41 42 40 60 205 Airbus A350 1 10 11 6 - - 28 Boeing 737NG 11 1 - - - - 12 Boeing 737MAX - - - 6 23 80 109 Boeing 787 6 14 14 18 5 - 57 Embraer E190 / 195-E2
Slide 25: Leasing Expenses
Leasing Expenses ($ million) 2Q 2015 2Q 2014 Default and Restructuring Related1 12.9 2.8 Normal Transition Costs 18.2 5.5 Maintenance Rights Expense 126.1 - Lessor Maintenance Contributions 11.8 10.3 Other Leasing Costs 4.4 4.0 Leasing Expenses 173.4 22.6 (1) 2Q 2015 default & restructuring related
Slide 26: Head Office, AerCap House
Head Office, AerCap House Stationsplein 965 1117 CE Schiphol, The Netherlands +31 20 655 9655 contact@aercap.com 26