AerCap Holdings N.V. Reports Financial Results for the Third Quarter 2024
Net income for the third quarter of 2024 was $375 million, or $1.95 per share.
Adjusted net income for the third quarter of 2024 was $463 million, or $2.41 per share.
Raising full year adjusted earnings per share guidance from approximately $10.25 to approximately $10.70, not including any gains on sale for the fourth quarter of 2024.
DUBLIN, Oct. 30, 2024 /PRNewswire/ -- AerCap Holdings N.V. (NYSE:AER), the industry leader across all areas of aviation leasing, today reported strong financial results for the third quarter of 2024.
"This was another strong quarter for AerCap. Demand for aircraft remains high, as evidenced by our 99% utilization rate, 92% extension rate for used aircraft and 27% gain-on-sale margin for the quarter. Reflecting our confidence in AerCap's future, we are raising our full year guidance for 2024. We recently announced another $500 million share repurchase program, taking total authorizations for this year to $1.5 billion. These actions are underpinned by our industry leading operating cash flow, which was a record $5.6 billion for the last twelve months," said Aengus Kelly, Chief Executive Officer of AerCap.
Highlights:
Unlevered gain-on-sale margin of 27% for assets sold in the third quarter of 2024, or 2.0x book value on an equity basis.
Cash flow from operating activities was $1.4 billion for the third quarter of 2024, and a record $5.6 billion for the last twelve months.
Signed financing transactions for approximately $10.5 billion in the third quarter of 2024 and completed inaugural Sukuk financing in October 2024.
Adjusted debt/equity ratio of 2.4 to 1 as of September 30, 2024.
Book value per share of $90.66 as of September 30, 2024, an increase of approximately 16% from September 30, 2023.
Repurchased 5.5 million shares for $497 million and authorized a $500 million share repurchase program during the third quarter of 2024.
Increased full-year 2024 adjusted earnings per share guidance from approximately $10.25 to approximately $10.70, not including any gains on sale for the fourth quarter of 2024.
Revenue and Net Spread
Three Months Ended September 30,
Nine months ended September 30,
2024
2023
% increase/(decrease)
2024
2023
% increase/(decrease)
(U.S. Dollars in millions)
(U.S. Dollars in millions)
Lease revenue:
Basic lease rents
$1,605
$1,575
2 %
$4,758
$4,673
2 %
Maintenance rents and other receipts
161
126
28 %
521
469
11 %
Total lease revenue
1,767
1,701
4 %
5,279
5,142
3 %
Net gain on sale of assets
102
130
(21 %)
391
395
(1 %)
Other income
79
61
30 %
254
144
76 %
Total Revenues and other income
$1,948
$1,892
3 %
$5,924
$5,682
4 %
Basic lease rents were $1,605 million for the third quarter of 2024, compared with $1,575 million for the same period in 2023. Basic lease rents for the third quarter of 2024 were negatively impacted by $31 million of lease premium amortization.
Maintenance rents and other receipts were $161 million for the third quarter of 2024, compared with $126 million for the same period in 2023. Maintenance rents for the third quarter of 2024 were negatively impacted by $44 million as a result of maintenance rights assets that were amortized to revenue.
Net gain on sale of assets for the third quarter of 2024 was $102 million, relating to 22 assets sold for $479 million, compared with $130 million for the same period in 2023, relating to 45 assets sold for $682 million. The decrease was primarily due to the volume and composition of asset sales.
Other income for the third quarter of 2024 was $79 million, compared with $61 million for the same period in 2023. The increase was primarily driven by higher interest income.
Three Months Ended September 30,
Nine months ended September 30,
2024
2023
% increase/(decrease)
2024
2023
% increase/(decrease)
(U.S. Dollars in millions)
(U.S. Dollars in millions)
Basic lease rents
$1,605
$1,575
2 %
$4,758
$4,673
2 %
Adjusted for:
Amortization of lease premium/deficiency
31
41
(24 %)
97
125
(22 %)
Basic lease rents excluding amortization of lease premium/
deficiency
$1,637
$1,616
1 %
$4,856
$4,798
1 %
Interest expense
516
447
16 %
1,486
1,311
13 %
Adjusted for:
Mark-to-market of interest rate derivatives
(22)
(7)
NA
(30)
(17)
NA
Interest expense excluding mark-to-market of interest rate derivatives
494
440
12 %
1,456
1,293
13 %
Adjusted net interest margin (*)
$1,142
$1,176
(3 %)
$3,400
$3,505
(3 %)
Depreciation and amortization
(653)
(623)
5 %
(1,923)
(1,849)
4 %
Adjusted net interest margin, less depreciation and amortization
$489
$553
(11 %)
$1,477
$1,656
(11 %)
Average lease assets (*)
$61,131
$59,951
2 %
$60,609
$59,605
2 %
Annualized net spread (*)
7.5 %
7.8 %
7.5 %
7.8 %
Annualized net spread less depreciation and amortization (*)
3.2 %
3.7 %
3.2 %
3.7 %
(*) Refer to "Notes Regarding Financial Information Presented in This Press Release" for details relating to these non-GAAP measures and metrics
Interest expense excluding mark-to-market of interest rate derivatives was $494 million for the third quarter of 2024, compared with $440 million for the same period in 2023. AerCap's average cost of debt was 4.0% for the third quarter of 2024 and 3.5% for the same period in 2023, excluding debt issuance costs, upfront fees and other impacts.
Selling, General and Administrative Expenses
Three Months Ended September 30,
Nine months ended September 30,
2024
2023
%increase/(decrease)
2024
2023
%increase/(decrease)
(U.S. Dollars in millions)
(U.S. Dollars in millions)
Selling, general and administrative expenses (excluding share-based
compensation expenses)
$97
$90
8 %
$284
$272
4 %
Share-based compensation expenses
24
21
12 %
82
70
17 %
Selling, general and administrative expenses
$121
$112
8 %
$366
$342
7 %
Selling, general and administrative expenses were $121 million for the third quarter of 2024, compared with $112 million for the same period in 2023.
Other Expenses
Leasing expenses were $275 million for the third quarter of 2024, compared with $166 million for the same period in 2023. The increase was primarily due to an increase of $140 million in our credit loss provision. Leasing expenses for the third quarter of 2024 were negatively impacted by $32 million of maintenance rights amortization.
Effective Tax Rate
AerCap's effective tax rate was 15.5% for the third quarter of 2024, compared to an effective tax rate of 9.4% for the third quarter of 2023. The effective tax rate is impacted by the source and amount of earnings among our different tax jurisdictions as well as the amount of permanent tax differences relative to pre-tax income or loss, and certain other discrete items.
Book Value Per Share
September 30, 2024
September 30, 2023
(U.S. Dollars in millions, except share and per share data)
Total AerCap Holdings N.V. shareholders' equity
$16,752
$16,294
Ordinary shares outstanding
189,731,024
212,379,835
Unvested restricted stock
(4,948,175)
(4,233,182)
Ordinary shares outstanding (excl. unvested restricted stock)
184,782,849
208,146,653
Book value per ordinary share outstanding (excl. unvested restricted stock)
$90.66
$78.28
Dividend declared per ordinary share for the nine months ended September 30, 2024
$0.50
—
Financial Position
September 30, 2024
December 31, 2023
% increase/
(decrease) over
December 31, 2023
(U.S. Dollars in millions)
Total cash, cash equivalents and restricted cash
$3,955
$1,825
117 %
Total assets
73,825
71,275
4 %
Debt
48,353
46,484
4 %
Total liabilities
57,072
54,686
4 %
Total AerCap Holdings N.V. shareholders' equity
16,752
16,589
1 %
Flight Equipment
As of September 30, 2024, AerCap's portfolio consisted of 3,491 aircraft, engines and helicopters that were owned, on order or managed. The average age of the company's owned aircraft fleet as of September 30, 2024 was 7.4 years (4.7 years for new technology aircraft, 14.7 years for current technology aircraft) and the average remaining contracted lease term was 7.3 years.
Dividend
In October 2024, AerCap's Board of Directors declared a quarterly cash dividend of $0.25 per share, with a payment date of December 5, 2024, to shareholders of record of AerCap ordinary shares as of the close of business on November 13, 2024.
Notes Regarding Financial Information Presented in This Press Release
The financial information presented in this press release is not audited.
Due to rounding, numbers presented throughout this document may not add up precisely to the totals provided and percentages may not ...
