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 - Shares of Willis Lease Finance Corporation (WLFC) increased by 8.1% post-earnings report for Q2 2025, outperforming the S&P 500's 1% growth during the same period [1] - The company reported Q2 2025 EPS of $8.43, a significant increase from $6.21 in Q2 2024 [1] Revenue and Earnings Performance - WLFC's total revenues reached $195.5 million, marking a 29.4% increase from $151.1 million in the previous year, driven by strong lease rent growth and increased spare parts and equipment sales [2] - Lease rent revenue rose 29.4% year over year to $72.3 million, while net income attributable to common shareholders surged 41.5% to $59 million [2] Key Business Metrics - Maintenance reserve revenues decreased by 19.3% year over year to $50.7 million due to timing differences and fewer engines coming off long-term leases [3] - Recurring short-term maintenance reserve revenue increased by 9.5%, reflecting higher engine utilization and contractual rate increases [4] - Spare parts and equipment sales skyrocketed nearly 391% to $30.4 million, driven by a large engine sale and strong demand as airlines extended fleet life [4] - The company's portfolio utilization rate improved to 88.3% at quarter end, up from 76.7% at year-end 2024 [4] Management Commentary - CEO Austin C. Willis attributed the record performance to a durable business model, rising lease rates, and strong demand for integrated maintenance and parts services [5] - CFO Scott B. Flaherty highlighted higher equipment sales, stronger lease revenues, and a $43 million gain from the consultancy business sale as key profitability drivers [5] Factors Influencing Financial Results - Revenue growth was bolstered by higher gross equipment sales, increased utilization, and strong demand for fixed asset trading, resulting in a $27.6 million gain on the sale of leased equipment, up 91.2% from the prior year [6] - Expenses rose significantly, with general and administrative costs up 45.4% and technical expenses up 66.2%, partly due to increased engine repair activity and legal costs [6] - Interest expense increased by 36.7% due to higher debt levels associated with expanded portfolio investments [6] Other Developments - WLFC sold its U.K.-based aviation consultancy business, generating a $43 million gain, which was part of a strategic reallocation towards core leasing and maintenance operations [8] - In July, Willis Aviation Services secured a commitment from Jet2.com for two base maintenance lines in the U.K., indicating ongoing expansion in maintenance capabilities [8]

Financial Performance - AerCap reported a GAAP EPS of $7.09 and an adjusted EPS of $2.83 for Q2 2025[10] - Net income for Q2 2025 was $1.259 billion, or $7.09 per share[16] - Adjusted net income for Q2 2025 was $502 million, or $2.83 per share[16] - The company is raising its 2025 adjusted EPS guidance to approximately $11.60, excluding any additional gains on sale[10, 21] - Q2 2025 operating cash flow was $1.3 billion[20] Transactions and Portfolio - AerCap leased, purchased, and sold a total of 116 assets in Q2 2025[11] - Sales in Q2 2025 amounted to $374 million, with an 18% gain-on-sale margin and a 1.7x book equity multiple[10] - New technology assets comprise approximately 75% of the total fleet[33] Capital Structure and Liquidity - The company has a strong liquidity position, with a next 12 months' sources-to-uses coverage of 1.9x and approximately $22 billion in sources of liquidity[17] - The adjusted leverage ratio is 2.2x[20] - AerCap repurchased 4.7 million shares in Q2 2025 for a total of $445 million[20] - Secured debt-to-total-assets ratio of approximately 11%[20]

Core Viewpoint - AerCap Holdings N.V. reported strong financial results for Q2 2025, achieving record net income and announcing a strategic partnership with Air France-KLM for engine leasing, amidst high global demand for aviation assets [2][8]. Financial Performance - Record net income of $1,259 million, or $7.09 per share, for Q2 2025, with adjusted net income of $502 million, or $2.83 per share [8][23]. - Total lease revenue for Q2 2025 was $1,768 million, a 1% increase from $1,748 million in Q2 2024, driven by basic lease rents of $1,653 million, up 5% year-over-year [4][42]. - Maintenance rents and other receipts decreased by 36% to $115 million in Q2 2025 compared to $180 million in Q2 2024 [5][42]. - Net gain on sale of assets was $57 million for Q2 2025, down 56% from $129 million in Q2 2024 [6][42]. Strategic Developments - A new strategic partnership with Air France-KLM was announced to enhance engine leasing capabilities [2]. - The company was awarded approximately $1 billion in insurance payments related to assets lost in Russia, significantly impacting financial results [9][11]. Operational Metrics - The average lease assets increased by 3% to $62,032 million as of June 30, 2025 [7]. - The annualized net spread remained stable at 7.5% for Q2 2025 [10]. - Cash flow from operating activities was $1.3 billion for Q2 2025 [9]. Shareholder Returns - The company returned $445 million to shareholders through share repurchases in Q2 2025, bringing total repurchases to over $1 billion year-to-date [9]. - A quarterly cash dividend of $0.27 per share was declared for Q3 2025 [19]. Financial Position - Total cash, cash equivalents, and restricted cash increased by 103% to $2,846 million as of June 30, 2025 [17]. - Book value per share rose to $102.99, a 15% increase from $89.47 a year earlier [15]. - The adjusted debt/equity ratio improved to 2.22 to 1 as of June 30, 2025 [28].

Due to rounding, numbers presented throughout this document may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures. AERCAP | FOURTH QUARTER 2024 FINANCIAL RESULTS AERCAP HOLDINGS N.V. FORWARD LOOKING STATEMENTS AND NON-GAAP FINANCIAL INFORMATION This presentation contains certain statements, estimates and forecasts with respect to future performance and events. These statements, estimates and forecasts are "forward-looking statements". In some cases, f ...