10-QPeriod: Q3 FY2017

FTAI Aviation Ltd. Quarterly Report for Q3 Ended Sep 30, 2017

Filed November 3, 2017For Securities:FTAIFTAIMFTAIN

Summary

FTAI Aviation Ltd. (FTAI) reported significant growth in revenues for the nine months ended September 30, 2017, up by $49.9 million compared to the same period in 2016, largely driven by its Aviation Leasing segment which saw increased lease income and maintenance revenue. The Infrastructure segment also contributed to revenue growth, though somewhat offset by a decline in Jefferson Terminal revenues. Despite revenue growth, FTAI experienced a net loss attributable to shareholders of $2.9 million for the nine months ended September 30, 2017, a substantial improvement from the $18.3 million net loss in the prior year's period. This improved net loss was primarily driven by a reduction in asset impairment charges and gains on the sale of equipment. Expenses increased overall, particularly in operating expenses, depreciation, and interest expense, the latter largely due to the issuance of Senior Notes. The company ended the period with total assets of $1.91 billion and total equity of $1.08 billion, while managing $655.6 million in debt.

Financial Highlights

44 data points
Beta

Revenue

$60.36M

Net Income

$3.00M

5.0% Net Margin

EPS (Diluted)

$0.04

Total Assets

$1.91B

Cash & Equivalents

$212.81M

Free Cash Flow

-$16.60M

Financial Statements
Beta
Revenue$60.36M
Operating Expenses$66.33M
Interest Expense$8.91M
Net Income$3.00M
EPS (Basic)$0.04
EPS (Diluted)$0.04
Shares Outstanding (Basic)75.77M
Shares Outstanding (Diluted)75.77M

Key Highlights

  • 1Total revenues increased by approximately 47% to $156.2 million for the nine months ended September 30, 2017, compared to $106.4 million for the same period in 2016.
  • 2Net loss attributable to shareholders improved significantly, decreasing from $18.3 million for the nine months ended September 30, 2016, to $2.9 million for the nine months ended September 30, 2017.
  • 3The Aviation Leasing segment showed strong revenue growth, with lease income increasing by $16.9 million and maintenance revenue by $27.7 million for the nine months ended September 30, 2017.
  • 4Total assets grew to $1.91 billion as of September 30, 2017, up from $1.55 billion as of December 31, 2016.
  • 5Total debt increased to $655.6 million as of September 30, 2017, from $259.5 million as of December 31, 2016, primarily due to the issuance of Senior Notes.
  • 6The company reported positive net cash provided by operating activities of $52.4 million for the nine months ended September 30, 2017, a significant increase from $15.7 million in the prior year.
  • 7FTAI Aviation declared a cash dividend of $0.33 per share for the quarter ended September 30, 2017, payable in November 2017.

Frequently Asked Questions

FTAI Aviation Ltd. demonstrated improved financial performance in the first nine months of 2017 compared to the same period in 2016. Total revenues increased significantly by approximately 47% to $156.2 million. While the company still reported a net loss attributable to shareholders of $2.9 million, this was a substantial improvement from the $18.3 million net loss reported in the prior year's period. This improvement was largely driven by increased revenues, particularly in the Aviation Leasing segment, and a reduction in asset impairment charges.

FTAI Aviation's total debt increased significantly, rising from $259.5 million at the end of 2016 to $655.6 million by September 30, 2017. This increase was primarily due to the issuance of $250 million of Senior Notes in March 2017, with an additional $100 million issued in August 2017, and borrowings under its Revolving Credit Facility. The company also repaid its Term Loan during this period.

The primary driver of revenue growth was the Aviation Leasing segment, which saw increases in both lease income (up $16.9 million) and maintenance revenue (up $27.7 million) for the first nine months of 2017. This was attributed to a larger number of aircraft and engines on lease and an increase in leases with maintenance arrangements. The Infrastructure segment also contributed to the revenue increase, although revenues from the Jefferson Terminal segment declined.

Yes, on November 2, 2017, FTAI Aviation's Board of Directors declared a cash dividend of $0.33 per share for the quarter ended September 30, 2017, payable to shareholders of record on November 17, 2017.