FTAI Aviation Ltd. Reports First Quarter 2024 Results, Declares Dividend of $0.30 per Ordinary Share


NEW YORK, April 25, 2024 (GLOBE NEWSWIRE) -- FTAI Aviation Ltd. (NASDAQ: FTAI) (the “Company” or “FTAI”) today reported financial results for the first quarter 2024. The Company’s consolidated comparative financial statements and key performance measures are attached as an exhibit to this press release.

Financial Overview

(in thousands, except per share data)
Selected Financial ResultsQ1’24
Net Income Attributable to Shareholders$      31,287
Basic Earnings per Ordinary Share$0.31
Diluted Earnings per Ordinary Share$0.31
Adjusted EBITDA(1)$164,101

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(1) For definitions and reconciliations of non-GAAP measures, please refer to the exhibit to this press release.

First Quarter 2024 Dividends

On April 25, 2024, the Company’s Board of Directors (the “Board”) declared a cash dividend on our ordinary shares of $0.30 per share for the quarter ended March 31, 2024, payable on May 21, 2024 to the holders of record on May 10, 2024.

Additionally, on April 25, 2024, the Board declared cash dividends on its Fixed-to-Floating Rate Series A Cumulative Perpetual Redeemable Preferred Shares (“Series A Preferred Shares”), Fixed-to-Floating Rate Series B Cumulative Perpetual Redeemable Preferred Shares (“Series B Preferred Shares”), Fixed-Rate Reset Series C Cumulative Perpetual Redeemable Preferred Shares (“Series C Preferred Shares”) and Fixed-Rate Reset Series D Cumulative Perpetual Redeemable Preferred Shares (“Series D Preferred Shares”) of $0.51563, $0.50000, $0.51563 and $0.59375 per share, respectively, for the quarter ended March 31, 2024, payable on June 14, 2024 to the holders of record on June 3, 2024.

Business Highlights

  • FTAI Aviation Ltd. and LATAM Airlines Group S.A. enter into a Perpetual Power Program covering over 60 engines.
  • Aerospace Products Adj. EBITDA reached $70 million, a 28.7% quarterly growth versus Q4 2023 and 156.7% growth vs Q1 2023. (1)

(1) For definitions and reconciliations of non-GAAP measures, please refer to the exhibit to this press release.

Additional Information

For additional information that management believes to be useful for investors, please refer to the presentation posted on the Investor Center section of the Company’s website, https://www.ftaiaviation.com, and the Company’s Quarterly Report on Form 10-Q, when available on the Company’s website. Nothing on the Company’s website is included or incorporated by reference herein.

Conference Call

In addition, management will host a conference call on Friday, April 26, 2024 at 8:00 A.M. Eastern Time. The conference call may be accessed by registering via the following link https://register.vevent.com/register/BId3fa86dd156541f2888a619e6966f685/. Once registered, participants will receive a dial-in and unique pin to access the call.

A simultaneous webcast of the conference call will be available to the public on a listen-only basis at https://www.ftaiaviation.com/. Please allow extra time prior to the call to visit the site and download the necessary software required to listen to the internet broadcast.

A replay of the conference call will be available after 11:30 A.M. on Friday, April 26, 2024 through 11:30 A.M. on Friday, May 3, 2024 on https://ir.ftaiaviation.com/news-events/presentations/.

The information contained on, or accessible through, any websites included in this press release is not incorporated by reference into, and should not be considered a part of, this press release.

About FTAI Aviation Ltd.

FTAI owns and maintains commercial jet engines with a focus on CFM56 and V2500 engines. FTAI’s propriety portfolio of products, including The Module Factory and a joint venture to manufacture engine PMA, enables it to provide cost savings and flexibility to our airline, lessor, and maintenance, repair, and operations customer base. Additionally, FTAI owns and leases jet aircraft which often facilitates the acquisition of engines at attractive prices. FTAI invests in aviation assets and aerospace products that generate strong and stable cash flows with the potential for earnings growth and asset appreciation.

Cautionary Note Regarding Forward-Looking Statements

Certain statements in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and beliefs and are subject to a number of trends and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements, many of which are beyond the Company’s control. The Company can give no assurance that its expectations will be attained and such differences may be material. Accordingly, you should not place undue reliance on any forward-looking statements contained in this press release. For a discussion of some of the risks and important factors that could affect such forward-looking statements, see the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, which are available on the Company’s website (www.ftaiaviation.com). In addition, new risks and uncertainties emerge from time to time, and it is not possible for the Company to predict or assess the impact of every factor that may cause its actual results to differ from those contained in any forward-looking statements. Such forward-looking statements speak only as of the date of this press release. The Company expressly disclaims any obligation to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with regard thereto or change in events, conditions, or circumstances on which any statement is based. This release shall not constitute an offer to sell or the solicitation of an offer to buy any securities.

For further information, please contact:

Alan Andreini
Investor Relations
FTAI Aviation Ltd.
(646) 734-9414
aandreini@fortress.com

Exhibit - Financial Statements

FTAI AVIATION LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(Dollar amounts in thousands, except share and per share data)

 Three Months Ended March 31,
  2024   2023 
Revenues   
Lease income$53,161  $55,978 
Maintenance revenue 45,790   35,141 
Asset sales revenue 38,607   108,691 
Aerospace products revenue 189,057   85,113 
Other revenue 79   7,795 
Total revenues 326,694   292,718 
    
Expenses   
Cost of sales 142,804   145,670 
Operating expenses 25,317   22,534 
General and administrative 3,683   4,067 
Acquisition and transaction expenses 6,179   3,262 
Management fees and incentive allocation to affiliate 4,895   2,997 
Depreciation and amortization 49,920   40,926 
Asset impairment 962   1,220 
Interest expense 47,707   39,292 
Total expenses 281,467   259,968 
    
Other (expense) income   
Equity in losses of unconsolidated entities (667)  (1,335)
Other income 634   8 
Total other expense (33)  (1,327)
Income before income taxes 45,194   31,423 
Provision for income taxes 5,572   2,026 
Net income 39,622   29,397 
Less: Dividends on preferred shares 8,335   6,791 
Net income attributable to shareholders$31,287  $22,606 
    
Earnings per share:   
Basic$0.31  $0.23 
Diluted$0.31  $0.22 
    
Weighted average shares outstanding:   
Basic 100,245,905   99,728,245 
Diluted 100,960,065   100,974,100 
        

FTAI AVIATION LTD.
CONSOLIDATED BALANCE SHEETS
(Dollar amounts in thousands, except share and per share data)

 (Unaudited)      
 March 31, 2024 December 31, 2023
Assets   
Cash and cash equivalents$65,224  $90,756 
Restricted cash 150   150 
Accounts receivable, net 137,399   115,156 
Leasing equipment, net 2,187,716   2,032,413 
Property, plant, and equipment, net 44,114   45,175 
Investments 22,055   22,722 
Intangible assets, net 46,583   50,590 
Goodwill 4,630   4,630 
Inventory, net 345,470   316,637 
Other assets 322,565   286,456 
Total assets$3,175,906  $2,964,685 
    
Liabilities   
Accounts payable and accrued liabilities$139,250  $112,907 
Debt, net 2,693,754   2,517,343 
Maintenance deposits 62,722   65,387 
Security deposits 42,431   41,065 
Other liabilities 60,143   52,100 
Total liabilities$2,998,300  $2,788,802 
    
Commitments and contingencies   
    
Equity   
Ordinary shares ($0.01 par value per share; 2,000,000,000 shares authorized; 100,245,905 and 100,245,905 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively)$1,002  $1,002 
Preferred shares ($0.01 par value per share; 200,000,000 shares authorized; 15,920,000 and 15,920,000 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively) 159   159 
Additional paid in capital 218,074   255,973 
Accumulated deficit (42,163)  (81,785)
Shareholders' equity 177,072   175,349 
Non-controlling interest in equity of consolidated subsidiaries 534   534 
Total equity 177,606   175,883 
Total liabilities and equity$3,175,906  $2,964,685 
        

FTAI AVIATION LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(Dollar amounts in thousands, unless otherwise noted)

 Three Months Ended March 31,
  2024   2023 
Cash flows from operating activities:   
Net income$39,622  $29,397 
Adjustments to reconcile net income to net cash (used in) provided by operating activities:   
Equity in losses of unconsolidated entities 667   1,335 
Gain on sale of leasing equipment, net (58,061)  (31,657)
Security deposits and maintenance claims included in earnings (2,437)  (9,842)
Equity-based compensation 510   108 
Depreciation and amortization 49,920   40,926 
Asset impairment 962   1,220 
Change in deferred income taxes 4,548   1,692 
Change in fair value of guarantees (259)  (1,769)
Amortization of lease intangibles and incentives 9,202   7,844 
Amortization of deferred financing costs 2,638   2,017 
Provision for credit losses    475 
Other (259)  (326)
Change in:   
Accounts receivable (27,945)  (14,840)
Inventory (6,877)  6,984 
Other assets (1,845)  (2,013)
Accounts payable and accrued liabilities (10,252)  6,088 
Management fees payable to affiliate 238   (386)
Other liabilities (717)  1,444 
Net cash (used in) provided by operating activities (345)  38,697 
    
Cash flows from investing activities:   
Investment in unconsolidated entities    (19,500)
Principal collections on finance leases 786    
Principal collections on notes receivable 1,964    
Acquisition of leasing equipment (276,990)  (127,513)
Acquisition of property, plant and equipment (1,312)  (1,451)
Acquisition of lease intangibles 862   (8,640)
Purchase deposits for acquisitions (25,535)  (9,940)
Proceeds from sale of leasing equipment 128,384   153,679 
Proceeds for deposit on sale of aircraft and engine 2,098   1,042 
Return of purchase deposits 530    
Net cash used in investing activities$(169,213) $(12,323)
    


 Three Months Ended March 31,
  2024   2023 
Cash flows from financing activities:   
Proceeds from debt$210,000  $145,000 
Repayment of debt (35,000)  (220,000)
Payment of deferred financing costs (292)   
Receipt of security deposits 1,856   1,459 
Return of security deposits    (65)
Receipt of maintenance deposits 8,927   10,142 
Release of maintenance deposits (3,056)   
Proceeds from issuance of preferred shares, net of underwriter's discount and issuance costs
    61,729 
Cash dividends - ordinary shares (30,074)  (29,919)
Cash dividends - preferred shares (8,335)  (6,791)
Net cash provided by (used in) financing activities$144,026  $(38,445)
    
Net decrease in cash and cash equivalents and restricted cash (25,532)  (12,071)
Cash and cash equivalents and restricted cash, beginning of period 90,906   53,065 
Cash and cash equivalents and restricted cash, end of period$65,374  $40,994 

Key Performance Measures

The Chief Operating Decision Maker (“CODM”) utilizes Adjusted EBITDA as our key performance measure.

Adjusted EBITDA provides the CODM with the information necessary to assess operational performance, as well as make resource and allocation decisions. Adjusted EBITDA is defined as net income (loss) attributable to shareholders from continuing operations, adjusted (a) to exclude the impact of provision for income taxes, equity-based compensation expense, acquisition and transaction expenses, losses on the modification or extinguishment of debt and capital lease obligations, changes in fair value of non-hedge derivative instruments, asset impairment charges, incentive allocations, depreciation and amortization expense, dividends on preferred shares, and interest expense, (b) to include the impact of our pro-rata share of Adjusted EBITDA from unconsolidated entities, and (c) to exclude the impact of equity in earnings (losses) of unconsolidated entities and the non-controlling share of Adjusted EBITDA.

The following table sets forth a reconciliation of net income attributable to shareholders to Adjusted EBITDA for the three months ended March 31, 2024 and 2023:

 Three Months Ended March 31, Change
(in thousands) 2024   2023  
Net income attributable to shareholders$31,287  $22,606  $8,681 
Add: Provision for income taxes 5,572   2,026   3,546 
Add: Equity-based compensation expense 510   108   402 
Add: Acquisition and transaction expenses 6,179   3,262   2,917 
Add: Losses on the modification or extinguishment of debt and capital lease obligations        
Add: Changes in fair value of non-hedge derivative instruments        
Add: Asset impairment charges 962   1,220   (258)
Add: Incentive allocations 4,308   2,942   1,366 
Add: Depreciation and amortization expense (1) 59,122   48,770   10,352 
Add: Interest expense and dividends on preferred shares 56,042   46,083   9,959 
Add: Pro-rata share of Adjusted EBITDA from unconsolidated entities (2) (548)  (696)  148 
Less: Equity in losses of unconsolidated entities 667   1,335   (668)
Less: Non-controlling share of Adjusted EBITDA        
Adjusted EBITDA (non-GAAP)$164,101  $127,656  $36,445 

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(1) Includes the following items for the three months ended March 31, 2024 and 2023: (i) depreciation and amortization expense of $49,920 and $40,926, (ii) lease intangible amortization of $3,976 and $3,983 and (iii) amortization for lease incentives of $5,226 and $3,861, respectively.

(2) Includes the following items for the three months ended March 31, 2024 and 2023: (i) net loss of $667 and $1,335, (ii) depreciation and amortization expense of $119 and $400, and (iii) acquisition and transaction expenses of $0 and $239, respectively.

For a reconciliation of net income attributable to shareholders to Adjusted EBITDA for the three months ended December 31, 2023, refer to the appendix of the FTAI Aviation Ltd. Earnings Supplement for the period Q4’23.