Willis Lease Finance Company WLFC reported third-quarter earnings of $3.37 per share, marking a major enhance from $2.13 per share in the identical quarter of 2023.
The corporate generated whole revenues of $146.2 million, a 38.3% year-over-year enhance in comparison with $105.7 million within the third quarter of 2023, pushed by development in core leasing and upkeep reserve revenues.
Willis Lease Finance’s third-quarter outcomes spotlight its strong footing within the aviation leasing market. Sturdy income development throughout core leasing and upkeep classes, coupled with positive factors from asset gross sales, positions the corporate nicely to capitalize on market wants. Whereas it faces elevated bills from enlargement initiatives and better rates of interest, the extra credit score facility and most well-liked inventory refinancing display proactive capital administration.
Willis Lease Finance Company Value, Consensus and EPS Shock
Willis Lease Finance Corporation price-consensus-eps-surprise-chart | Willis Lease Finance Company Quote
Key Enterprise Metrics
Lease Lease Revenues
Lease hire revenues have been a major contributor, amounting to $64.9 million within the third quarter of 2024, up 21.2% from $53.6 million in the identical interval final yr. This development was supported by elevated asset deployment and new lease agreements, demonstrating sustained demand for Willis Lease Finance’s companies throughout the aviation sector.
Upkeep Reserve Revenues
Upkeep reserve revenues rose 32% yr over yr, reaching $49.8 million in comparison with $37.7 million within the third quarter of 2023. This enhance was pushed by excessive utilization charges of leased engines and different aviation property.
Spare Elements and Tools Gross sales
Revenues from spare components and tools gross sales noticed substantial development, rising to $10.9 million within the third quarter of 2024 from $3.4 million within the year-ago quarter. This enhance aligns with market tendencies of extending the operational lifespan of current-generation engines, which has elevated demand for surplus components. Moreover, the corporate recorded $1 million from tools gross sales for one engine within the quarter, a development from no tools gross sales within the prior-year quarter.
Good points on Sale of Leased Tools
Good points from the sale of leased tools have been one other income driver, totaling $9.5 million from the sale of 13 engines and different property. This contrasts with a modest $0.8 million acquire recorded within the third quarter of 2023, showcasing the corporate’s efficient asset turnover and skill to capitalize on favorable secondary market circumstances.
Total Prices
Complete bills rose to $112.5 million, a 31.2% enhance yr over yr, with common and administrative (G&A) bills displaying a notable rise of fifty.8% to $40 million. This enhance in G&A bills displays the corporate’s investments in capability and assets essential to maintain development. Web finance prices elevated by 46%, primarily on account of larger curiosity bills, reaching $27.8 million within the third quarter of 2024, up from $19.1 million a yr earlier. The rise in curiosity bills is related to larger borrowing to fund tools purchases and different capital-intensive initiatives.
Pre-Tax Earnings
Quarterly pre-tax earnings stood at $34.5 million, up 69.4% from $20.3 million within the prior-year interval. This strong monetary efficiency displays continued demand within the aviation leasing market and the environment friendly scalability of the corporate’s built-in companies and asset base.
Web Earnings
The corporate’s web earnings attributable to widespread shareholders surged to $23.1 million, a 67.9% enchancment from the third quarter of 2023, reflecting strong operational efficiencies and a good leasing surroundings.
Stability Sheet Replace (As of Sept. 30, 2024)
Willis Lease Finance held money and money equivalents totaling $5.8 million, a lower from $7.1 million on the finish of 2023.
The corporate’s whole property grew considerably to $3 billion, up from $2.7 billion as of Dec. 31, 2023.
Debt obligations additionally noticed a rise, rising to $2 billion from $1.8 billion at year-end 2023.
Shareholders’ fairness strengthened to $517.8 million, up from $439 million on the finish of 2023.
Different Developments
Within the third quarter of 2024, Willis Lease Finance accomplished a number of key monetary initiatives to assist its development trajectory. On Sept. 27, 2024, the corporate refinanced its Collection A most well-liked inventory, rising its fairness by consolidating the Collection A-1 and Collection A-2 most well-liked inventory right into a $65 million Collection A collection with an 8.35% dividend charge. This transfer enhances the corporate’s capital construction, offering further fairness for enlargement.
Furthermore, the corporate entered into a brand new $1 billion, five-year revolving credit score facility on Oct. 31, 2024, changing an current $500 million facility. This expanded facility supplies Willis Lease Finance with the capital flexibility required to fulfill future demand and fund its rising lease portfolio. The corporate additionally declared a quarterly dividend of 25 cents per share, to be paid on Nov. 21, 2024, underscoring its dedication to returning worth to shareholders.
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