Financial Data and Key Metrics Changes - In Q4 2024, total revenues reached $152.8 million, with pre-tax income of $30.4 million, marking a 44.8% increase from $21 million in Q4 2023 [8][22] - For the full year 2024, total revenues were $569.2 million, with pre-tax income of $152.6 million, representing a 127% increase from the previous year [8][21] - The company achieved a return on equity of 21% for 2024, the highest since going public [8] Business Line Data and Key Metrics Changes - Core lease rent revenues for 2024 were $238.2 million, with interest revenues of $11.7 million, reflecting growth due to an increased portfolio size of $2.87 billion [23] - Maintenance reserve revenues increased by 60% to $213.9 million, driven by both long-term and short-term maintenance reserves [25] - Spare parts and equipment sales rose by 33% to $27.1 million, indicating a strong market for residual values [26] Market Data and Key Metrics Changes - The company noted a strong engine market, with increasing values for both whole engines and parts, although originating transactions have become more challenging due to high asset values [45][46] - The disparity between the fair market value and book value of the engine portfolio has increased to approximately $600 million, highlighting the appreciation of engine assets over time [30][80] Company Strategy and Development Direction - The company continues to innovate, having established several industry firsts, including the first engine warehouse financing and the first aviation ABS to reopen the market [6][9] - The business model focuses on a flywheel approach, enhancing value creation and providing greater investment opportunities compared to competitors [11] - The company is strategically increasing its portfolio of future technology assets, which rose from 46% to 53% by the end of 2024 [100] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing strength of the core leasing business and the ability to generate premium returns [8][19] - The company anticipates continued demand for its constant thrust product as airlines transition to newer aircraft models [18] - Management acknowledged the challenges in the market but emphasized a robust pipeline of opportunities for originating transactions [47] Other Important Information - The company returned capital to shareholders through dividends, including a special dividend of $1 per share and regular quarterly dividends of $0.25 per share [37] - Total debt obligations increased from $1.8 billion to $2.3 billion, with a slight increase in leverage to 3.48 times [34][38] Q&A Session Summary Question: Update on the engine market and values - Management noted a strong engine market with some scarcity, but they have been successful in originating transactions [45][46] Question: Availability of test cell for engine work - The company does not currently have a test cell and availability varies [51] Question: Discounts on new engine purchases - Management confirmed successful purchasing of new engines but did not disclose specific discounts [56][57] Question: Earnings from joint ventures - Management indicated that JV earnings have been stable and will benefit from scale over time [70] Question: Fair market value vs. book value of engine portfolio - The disparity has increased to approximately $600 million, reflecting the appreciation of engine assets [80] Question: Proportion of short-term vs. long-term maintenance reserve revenue - Management expects the trend of increased short-term maintenance reserves to continue [88] Question: Long-term lease extensions - The company is experiencing higher than average extension rates but uses this as an opportunity to reprice [96]