COCONUT CREEK, Fla., Dec. 11, 2025 (GLOBE NEWSWIRE) -- Willis Lease Finance Corporation (NASDAQ: WLFC) (“WLFC” or the “Company”), the leading lessor of commercial aircraft engines and global provider of aviation services, announced today that its wholly-owned subsidiary, Willis Engine Structured Trust IX (“WEST”), has priced $337,400,000 in aggregate principal amount of Series A Fixed Rate Notes (the “Series A Notes”) and $55,500,000 in aggregate principal amount of Series B Fixed Rate Notes (the “Series B ...

Core Points - Willis Lease Finance Corporation (WLFC) announced the offering of $337.4 million in Series A Fixed Rate Notes and $55.5 million in Series B Fixed Rate Notes through its subsidiary, Willis Engine Structured Trust IX (WEST) [1] - The Notes will be secured by interests in a portfolio of 47 aircraft engines and 2 airframes, which will be acquired from WLFC or its subsidiaries [1] - The net proceeds from the Notes will be used for fees related to the offering, reserve accounts for security deposits and maintenance expenses, and to pay WLFC for the acquired aircraft engines and airframes [2] Financial Details - The total amount of the Initial Notes being offered is $392.9 million, comprising $337.4 million in Series A Notes and $55.5 million in Series B Notes [1] - WLFC plans to use any net proceeds received to repay debt collateralized by the assets and for general corporate purposes [2] Regulatory Information - The Notes will not be registered under the Securities Act of 1933 and are being offered only to qualified institutional buyers and non-U.S. persons [3] - The offering does not constitute an offer to sell or a solicitation of an offer to buy in jurisdictions where such actions would be unlawful [4]

Core Insights - The company Willis Lease Finance (WLFC) was previously rated a hold due to its price-to-book (PB) ratio of 1.8x, which was considered high at that time [1] Group 1: Company Analysis - The company has been trading at a PB of 1.8x, indicating a valuation that may not be attractive for new investments [1] - The analysis reflects a perspective of seeking high-quality stocks that are trading at discounted prices, suggesting a focus on value investing [1] Group 2: Market Perspective - The equity markets are described as fascinating, providing an analytical overview of global market performance, which is essential for understanding investment opportunities [1]

Core Insights - Shares of Willis Lease Finance Corporation (WLFC) have declined 4.6% since the earnings report for Q3 2025, contrasting with a 1.8% decline in the S&P 500 index during the same period [1] - The company reported earnings per share (EPS) of $3.25, down from $3.37 in the same quarter last year [1] Revenue and Growth - Total revenues reached $183.4 million, a 25.4% increase from $146.2 million in the prior-year period, driven by strong lease rent and maintenance reserve revenues [2] - Lease rent revenues hit a record $76.6 million, up 17.9% year over year, while maintenance reserve revenue surged 52.8% to $76.1 million [2] Operational Performance - Income from operations was $38 million, reflecting a 12.8% increase, and pre-tax income was $43.2 million, up 25.4% compared to the same quarter last year [3] - Net income attributable to common shareholders slightly decreased to $22.9 million from $23.1 million, a decline of 1.1% due to higher expenses [3] Business Metrics - The portfolio utilization rate improved to 86%, up from 82.9% a year earlier, indicating operational strength [4] - Long-term maintenance revenues rose sharply to $29.5 million from $1.2 million in Q3 2024, reflecting effective monetization of maintenance reserves [4] Gains and Asset Management - Gains on the sale of leased equipment totaled $16.1 million, significantly higher than the $9.5 million gain recorded in the same period last year [5] - The company completed several asset purchases, acquiring 16 engines and one aircraft, while also selling 10 engines and one airframe [11] Management Insights - CEO Austin Willis emphasized the resilience of WLFC's business model amid challenging conditions, attributing success to strong demand for leasing services [6] - The decision to raise the quarterly dividend from 25 cents to 40 cents per share was presented as a vote of confidence in the company's cash-generative model [6] Financial Challenges - General and administrative expenses rose 22.9% to $49.2 million, driven by increased headcount and consultant fees [8] - Write-downs of equipment surged to $10.2 million from $0.6 million a year ago, primarily due to impairments of off-lease assets [8] - Interest expense increased 22.9% to $34.2 million, influenced by higher debt levels and rates [9] Tax Implications - The effective tax rate increased to 43.7%, up from 30.1% in Q3 2024, attributed to recent tax law changes [10] Future Plans - WLFC appointed Pascal Picano as Senior Vice President of Aircraft Leasing and Trading, indicating plans for expansion and professionalization of leasing operations [12] - The company highlighted future capital deployment plans, including investments in sustainable aviation fuel (SAF) production and additional aircraft leasing ventures [12]

Core Insights - Willis Lease Finance Corporation (WLFC) has appointed David Hooke as Senior Vice President of Mergers & Acquisitions to enhance its global strategy and portfolio growth [1][2][3] Company Overview - WLFC is a leading lessor of commercial aircraft engines and provides a range of aviation services, including leasing large and regional spare engines, auxiliary power units, and aircraft to various clients worldwide [6] - The company integrates its leasing activities with end-of-life solutions for engines and aviation materials through Willis Aeronautical Services, Inc. [6] Leadership and Experience - David Hooke brings over a decade of investment banking experience from Bank of America, where he served as Managing Director, advising on mergers and acquisitions, public offerings, and capital markets transactions [3] - Hooke has a military background as a KC-130J Aircraft Commander in the United States Marine Corps, where he held various leadership roles [4][5] Strategic Goals - The appointment of Hooke is aimed at accelerating growth through strategic acquisitions and partnerships that will strengthen WLFC's global platform [2][3]

Group 1 - The Aerospace Forum is a leading investment research service focused on aerospace, defense, and airline sectors, providing access to data analytics and investment ideas [1][2] - Dhierin-Perkash Bechai, an analyst with a background in aerospace engineering, leads the group and aims to identify investment opportunities within the industry [2] - The analysis provided by the group is data-driven, offering insights into how industry developments may impact investment strategies [2]

Revenue Performance - Total revenue for the three months ended September 30, 2025, increased by 25.4% to $183.4 million compared to $146.2 million for the same period in 2024[120]. - Total revenue increased by $120.2 million, or 28.9%, to $536.6 million for the nine months ended September 30, 2025, compared to $416.4 million for the same period in 2024[137]. Lease and Maintenance Revenue - Lease rent revenue rose by 17.9% to $76.6 million, driven by an increase in the average size of the portfolio and higher average utilization, which was approximately 86.0% for Q3 2025 compared to 82.9% for Q3 2024[120][121]. - Lease rent revenue rose by $42.9 million, or 24.7%, to $216.6 million, driven by an increase in the average size of the portfolio and average utilization[137]. - Maintenance reserve revenue surged by 52.8% to $76.1 million, with long-term maintenance revenue significantly increasing to $29.5 million from $1.2 million in the prior year[123]. - Maintenance reserve revenue increased by $25.1 million, or 16.1%, to $181.7 million, with long-term maintenance revenue up by 61.0% to $39.5 million[140]. Sales and Services - Spare parts and equipment sales decreased by 50.3% to $5.4 million, reflecting timing variations in sales[124]. - Spare parts and equipment sales surged by $33.7 million, or 165.5%, to $54.0 million, reflecting strong demand for surplus material[141]. - Maintenance services revenue fell by 38.9% to $3.6 million, primarily due to the sale of the fleet management line of business[127]. - The company reported a net gain of $16.1 million from the sale of leased equipment during Q3 2025, compared to a net gain of $9.5 million in Q3 2024[126]. - Gain on sale of leased equipment increased to $48.2 million from $33.1 million, with 31 engines sold during the period[143]. Expenses and Costs - General and administrative expenses increased by 22.9% to $49.2 million, influenced by higher consultant and legal fees, as well as increased personnel costs[133]. - General and administrative expenses rose by $43.0 million, or 41.3%, to $147.3 million, largely due to increased personnel costs and consultant fees[151]. - Net finance costs rose by 33.5% to $37.1 million, primarily due to increased debt obligations and additional interest expenses related to new notes payable[135]. - Net finance costs increased by $27.4 million, or 36.4%, to $102.8 million, attributed to higher debt obligations and interest expenses[153]. Cash Flow and Investments - Cash flows from operating activities decreased by $7.4 million, or 3.4%, to $209.1 million, driven by lower payments on sales-type leases and changes in accounts receivable[159]. - Cash flows used in investing activities were $108.2 million for the nine months ended September 30, 2025, compared to $455.0 million for the same period in 2024, reflecting a significant decrease[160]. - Cash flows used in financing activities were $62.4 million for the nine months ended September 30, 2025, primarily due to $1,029.8 million in principal payments, offset by $1,005.1 million in proceeds from debt obligations[161]. Tax and Debt Obligations - Income tax expense for Q3 2025 was $18.9 million, with an effective tax rate of 43.7%, up from 30.1% in the prior year, influenced by changes in tax deductions[136]. - As of September 30, 2025, total debt obligations were $2,239.5 million, with interest rates ranging from approximately 3.1% to 8.0%[165]. - The company was in compliance with financial covenants, including an Interest Coverage Ratio of at least 2.25 to 1.00 and a Total Leverage Ratio not greater than 4.00 to 1.00[167]. - Interest payments under debt obligations are estimated at $394.4 million, with $99.9 million due in less than one year[169]. Future Commitments and Risks - The company has contractual commitments to purchase 30 additional LEAP-1A engines and 21 LEAP-1B engines for a total of $912.6 million by 2030[169]. - Approximately 70% of lease rent revenues for the nine months ended September 30, 2025, came from non-U.S. domiciled lessees, exposing the company to currency devaluation risk[176]. - For every one percent increase or decrease in interest rates on variable rate debt, annual interest expense would increase or decrease by $2.5 million[174].

Financial Data and Key Metrics Changes - The company reported quarterly revenue of $183.4 million, a 25.4% increase year over year, driven by strong demand for leasing services and a strengthening aviation market [3][4] - Core leasing revenues reached a record $76.6 million, up 17.9% from the prior year, while maintenance reserve revenue increased by 52.8% to $76.1 million [9][10] - Net income attributable to common shareholders was $22.9 million, with diluted weighted average income per share at $3.25 [19][20] Business Line Data and Key Metrics Changes - Leasing, maintenance reserve, and interest revenue totaled $156 million, reflecting a 32% increase from the same quarter in 2024 [5][9] - The average portfolio utilization increased to 86% from 82.9% in the comparable period of 2024 [10] - Maintenance reserve revenues associated with long-term liabilities rose significantly to $29.5 million from $1.2 million in the prior year [11] Market Data and Key Metrics Changes - The company purchased 16 engines and six aircraft for a total of approximately $136.4 million, indicating strong market activity [3][4] - The average lease rate factors for on-lease operating lease assets remained stable at 1.04% compared to the previous year [10] Company Strategy and Development Direction - The company aims to grow its aircraft leasing capabilities while maintaining its core focus on engine leasing and services [8][45] - The recent hiring of Pascale Tucano as Senior Vice President of Aircraft Leasing and Trading is expected to enhance the company's capabilities in aircraft leasing [6][8] - The company is also focusing on sustainable aviation fuel (SAF) projects, with plans to solicit third-party equity for funding [45][46] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the leasing business, citing robust demand and operational capacity [4][5] - The company anticipates that improved clarity on new aircraft delivery dates will benefit its services and leasing strategies [5][26] - Management acknowledged the potential impact of increased aircraft supply on legacy engine values but emphasized the ongoing demand for their services [25][26] Other Important Information - The company declared its seventh consecutive quarterly dividend, increasing it to $0.40 per share, reflecting confidence in business strength [4][23] - Total debt obligations increased to $2.24 billion, with a fixed-rate debt profile of 89% and a weighted average cost of debt at 5.11% [18][22] Q&A Session Summary Question: Impact of improving new aircraft delivery rates on legacy engine values - Management noted that increased aircraft supply could lead to the retirement of older aircraft, potentially affecting legacy engine values, but emphasized the ongoing demand for their services [25][26] Question: Reconciliation of common equity increase versus reported earnings - Management explained that the increase in common equity includes various components such as net income and stock-based compensation, which will be detailed in the upcoming 10-Q [28][29] Question: General and administrative expense clarification - Management provided details on the increase in G&A expenses, attributing it to higher personnel costs and changes in share-based compensation [30][32] Question: Write-downs and their frequency - Management clarified that write-downs are common in the engine space and are related to assets coming off lease, with recent write-downs reflecting the transition of engines to held for sale [40][41] Question: Future investment in aircraft leasing - Management confirmed plans to expand aircraft leasing capabilities while maintaining their core focus on engine leasing, emphasizing a thoughtful growth strategy [44][45] Question: Funding for SAF project - Management indicated that they plan to seek third-party equity for the SAF project, with a conservative risk approach to funding [45][46]

Financial Data and Key Metrics Changes - In Q3 2025, Willis Lease Finance Corporation reported quarterly revenue of $183.4 million, a 25.4% increase year over year, driven by strong demand for leasing services and a strengthening aviation market [3][4] - Core leasing revenues reached a record $76.6 million, up 17.9% from the same period in 2024, while maintenance reserve revenue increased by 52.8% to $76.1 million [10][11] - Earnings before tax (EBT) for the quarter was $43.2 million, reflecting a 25% increase from the comparable period in 2024 [19] Business Line Data and Key Metrics Changes - The leasing, maintenance reserve, and interest revenue totaled $156 million, marking a 32% increase from Q3 2024 [5] - Average portfolio utilization increased to 86% from 82.9% in the prior year, indicating robust demand for engines [10] - Maintenance services revenue decreased to $3.6 million, primarily due to the sale of the engine consulting business [14][15] Market Data and Key Metrics Changes - The company purchased 16 engines and six aircraft for its lease portfolio, totaling approximately $136.4 million, including significant acquisitions from Air India Express [3][4] - The average lease rate factor for operating lease assets remained stable at 1.04, consistent with the previous year [11] Company Strategy and Development Direction - The company aims to enhance its aircraft leasing capabilities while maintaining its core focus on engine leasing and services [8][56] - The opening of new aircraft maintenance hangars in Teeside is expected to provide competitive products to airlines, with the new space already fully booked [6] - The company is committed to becoming a premier partner in aviation propulsion, focusing on sustainable flight solutions [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the business, citing ongoing demand for leasing services and the potential for increased aircraft deliveries to impact fleet management strategies [6][28] - The company anticipates that the transition to new aircraft will take time, but it is well-positioned with over 53% of its portfolio in future generation equipment [29] Other Important Information - The company declared its seventh consecutive quarterly dividend, increasing it to $0.40 per share, reflecting confidence in business strength [4][23] - Total debt obligations increased to $2.24 billion, with a leverage ratio of 2.9 times, down from 3.48 times at the end of 2024 [22][24] Q&A Session Summary Question: Impact of improving new aircraft delivery rates on legacy engine values - Management indicated that increased aircraft supply could lead to the retirement of older aircraft, potentially affecting legacy engine values, but it would also benefit service offerings [26][28] Question: Reconciliation of common equity increase and reported earnings - Management explained that the increase in common equity includes components like stock-based compensation and other adjustments beyond net income [32][33] Question: General and administrative expense details - Management clarified that the increase in G&A expenses was due to higher personnel costs and incentive compensation linked to business performance [35][37] Question: Write-downs and their frequency - Management noted that write-downs are influenced by asset utilization and the transition of engines at the end of leases, with recent write-downs being part of a normal cycle [50][52] Question: Plans for aircraft leasing investment - Management confirmed intentions to expand aircraft leasing while maintaining a focus on engine leasing, emphasizing value addition for customers [56][57] Question: Funding for the SAF project - Management stated that funding for the SAF facility would involve both company equity and third-party investments, with a conservative risk approach [59]

Core Insights - Willis Lease Finance Corporation (WLFC) reported a quarterly pre-tax income of $43.2 million and total revenue of $183.4 million for Q3 2025, reflecting a 25.4% increase compared to Q3 2024 [1][5] - The company declared a quarterly dividend of $0.40 per share, up from $0.25 per share, to be paid on November 26, 2025 [1] Financial Performance - Total revenue for Q3 2025 was $183.4 million, a 25.4% increase from $146.2 million in Q3 2024 [2][3] - Core lease rent and maintenance reserve revenues reached $152.6 million, up 33.1% from $114.7 million in the same period last year [2][3] - Lease rent revenue increased by $11.6 million, or 17.9%, to $76.6 million compared to $64.9 million in Q3 2024 [4][5] - Maintenance reserve revenue saw a significant increase of 52.8%, reaching $76.1 million [5][14] - The company recognized $29.5 million in long-term maintenance revenue, a substantial rise from $1.2 million in Q3 2024 [6] Operational Highlights - The gain on the sale of leased equipment was $16.1 million, reflecting the sale of 10 engines and other parts, compared to a gain of $9.5 million from 13 engines sold in Q3 2024 [7] - The lease portfolio's book value was $3,302.6 million as of September 30, 2025 [8] - The lease portfolio consisted of $2,888.5 million in assets, including 354 engines and 20 aircraft [9] Market Context - The growth in revenue was primarily driven by the strong aviation marketplace, as airlines utilized WLFC's extensive portfolio of in-demand engines and maintenance capabilities [2][4] - The company’s CEO highlighted that the cost of new engines continues to drive demand for their leasing model [4]