Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $297.4 million for Q3 2025, up 28% from $232 million in Q3 2024, and in line with Q2 2025 results [18][19] - Adjusted free cash flow for Q3 was $268 million, contributing to a year-to-date total of $638 million, on track to meet the revised goal of $750 million for 2025 [14][16] - The aerospace products segment generated $180.4 million in EBITDA with a margin of 35%, reflecting a 77% increase year-over-year [9][19] Business Line Data and Key Metrics Changes - Aerospace products segment saw a significant increase in EBITDA, reaching $180 million, up from $101.8 million in Q3 2024 [9][19] - The leasing segment posted approximately $134 million in adjusted EBITDA, with pure leasing component at $122 million for Q3 [20][21] - The company refurbished 207 CFM56 modules in Q3, a 13% increase from the previous quarter, and is on track to produce 750 modules in 2025 [10][13] Market Data and Key Metrics Changes - The company is targeting a total portfolio size of approximately 375 aircraft, with full capital deployment anticipated by mid-2026 [7] - The market for aircraft engine assets is characterized by a significant number of older aircraft being sold by lessors, creating opportunities for the company to acquire assets [35][36] Company Strategy and Development Direction - The company aims to pivot to an asset-light model focused on aerospace products and strategic capital, expecting substantial growth in free cash flow [15][16] - The successful launch of the Strategic Capital Initiative (SCI) is expected to create significant value and position the company for long-term earnings growth [5][7] - The company plans to continue launching additional SCI partnerships each year, enhancing returns for equity partners [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving a market share of 25% in the engine aftermarket maintenance sector in the coming years [10] - The company anticipates total business segment EBITDA of $1.525 billion in 2026, up from the original estimate of $1.4 billion [17] - Management highlighted the importance of maintaining strong relationships with airline customers and the benefits of their Maintenance Repair Exchange (MRE) model [39][40] Other Important Information - The company announced an increase in the quarterly dividend from $0.30 to $0.35 per share, marking its 42nd dividend as a public company [15] - The acquisition of ATOPS for approximately $15 million is expected to enhance production capacity and operational efficiency [12][30] Q&A Session Summary Question: Financial implications of the upsizing of SCI - Management indicated that the upsizing will accelerate growth under SCI, potentially increasing its contribution to aerospace products volume from 20% to 25% [25][26] Question: Details on the ATOPS acquisition - The ATOPS acquisition is aimed at increasing production capacity ahead of needs, with a focus on synergy with existing facilities [28][30] Question: Availability of aircraft engine assets - Management noted that there is a significant supply of older aircraft being sold by lessors, providing opportunities for acquisition [35][36] Question: Treatment of SCI in financials - The 19% equity portion of SCI will be reflected in the equity income line and will also generate servicing revenue [40][41] Question: Guidance for 2026 - Management expects growth in both volume and margin, driven by new and existing customer orders [68][70] Question: Management and performance fees for SCI - The asset management fee is market-based, typically around 1% of total assets, with incentive compensation tied to performance [76][77] Question: Long-term partnerships and margin impact - Future deals are expected to be similar to existing large programs, with margins improving as customer orders increase [84][86]

Q1 2025 Earnings Supplement FTAI AVIATION Disclaimers Presentation. IN GENERAL. This disclaimer applies to this document and the verbal or written comments of any person presenting it. This document, taken together with any such verbal or written comments, is referred to herein as the "Presentation." The information contained on, or accessible through, any websites included in this Presentation is not incorporated by reference into, and should not be considered a part of, this FORWARD-LOOKING STATEMENTS. Ce ...