Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Nov. 05, 2013 | |
Document and Entity Information | ' | ' |
Entity Registrant Name | 'WILLIS LEASE FINANCE CORP | ' |
Entity Central Index Key | '0001018164 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-13 | ' |
Amendment Flag | 'false | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 8,429,993 |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
ASSETS | ' | ' |
Cash and cash equivalents | $4,028 | $5,379 |
Restricted cash | 38,003 | 24,591 |
Equipment held for operating lease, less accumulated depreciation of $250,938 and $242,529 at September 30, 2013 and December 31, 2012, respectively | 1,015,588 | 961,459 |
Equipment held for sale | 31,506 | 23,607 |
Operating lease related receivable, net of allowances of $427 and $980 at September 30, 2013 and December 31, 2012, respectively | 5,082 | 12,916 |
Investments | 18,072 | 21,831 |
Property, equipment & furnishings, less accumulated depreciation of $8,523 and $7,087 at September 30, 2013 and December 31, 2012, respectively | 4,994 | 5,989 |
Equipment purchase deposits | 1,369 | 1,369 |
Other assets | 20,779 | 21,574 |
Total assets | 1,139,421 | 1,078,715 |
Liabilities: | ' | ' |
Accounts payable and accrued expenses | 12,877 | 15,374 |
Liabilities under derivative instruments | 301 | 1,690 |
Deferred income taxes | 82,608 | 90,248 |
Notes payable | 744,300 | 696,988 |
Maintenance reserves | 76,579 | 63,313 |
Security deposits | 12,535 | 6,956 |
Unearned lease revenue | 3,740 | 4,593 |
Total liabilities | 932,940 | 879,162 |
Shareholders' equity: | ' | ' |
Common stock ($0.01 par value, 20,000,000 shares authorized; 8,492,948 and 8,715,580 shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively) | 85 | 87 |
Paid-in capital in excess of par | 44,950 | 47,785 |
Retained earnings | 161,984 | 152,911 |
Accumulated other comprehensive loss, net of income tax benefit of $251 and $651 at September 30, 2013 and December 31, 2012, respectively | -538 | -1,230 |
Total shareholders' equity | 206,481 | 199,553 |
Total liabilities and shareholders' equity | $1,139,421 | $1,078,715 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, except Share data, unless otherwise specified | ||
Consolidated Balance Sheets | ' | ' |
Equipment held for operating lease, accumulated depreciation (in dollars) | $250,938 | $242,529 |
Operating lease related receivable, allowances (in dollars) | 427 | 980 |
Property, equipment & furnishings, accumulated depreciation (in dollars) | 8,523 | 7,087 |
Common stock, par value (in dollars per share) | $0.01 | $0.01 |
Common stock, shares authorized | 20,000,000 | 20,000,000 |
Common stock, shares issued | 8,492,948 | 8,715,580 |
Common stock, shares outstanding | 8,492,948 | 8,715,580 |
Accumulated other comprehensive loss, income tax benefit (in dollars) | $251 | $651 |
Consolidated_Statements_of_Inc
Consolidated Statements of Income(Loss) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
REVENUE | ' | ' | ' | ' |
Lease rent revenue | $25,779 | $23,022 | $75,016 | $70,917 |
Maintenance reserve revenue | 8,891 | 10,653 | 29,908 | 28,668 |
Gain on sale of leased equipment | 2,022 | 561 | 3,556 | 4,557 |
Other revenue | 1,260 | 3,270 | 2,729 | 4,256 |
Total revenue | 37,952 | 37,506 | 111,209 | 108,398 |
EXPENSES | ' | ' | ' | ' |
Depreciation expense | 15,762 | 13,885 | 43,563 | 38,881 |
Write-down of equipment | 4,283 | 2,474 | 6,268 | 2,756 |
General and administrative | 6,792 | 7,298 | 24,265 | 25,339 |
Technical expense | 4,533 | 1,961 | 10,423 | 4,715 |
Net finance costs: | ' | ' | ' | ' |
Interest expense | 9,905 | 7,529 | 28,984 | 22,595 |
Interest income | ' | -21 | ' | -81 |
Loss on debt extinguishment and derivatives termination | ' | 15,412 | ' | 15,412 |
Total net finance costs | 9,905 | 22,920 | 28,984 | 37,926 |
Total expenses | 41,275 | 48,538 | 113,503 | 109,617 |
Loss from operations | -3,323 | -11,032 | -2,294 | -1,219 |
Earnings (loss) from joint ventures | -289 | 352 | 3,186 | 948 |
Income (loss) before in come taxes | -3,612 | -10,680 | 892 | -271 |
Income tax benefit (expense) | 1,383 | 3,486 | 8,181 | -405 |
Net income (loss) | -2,229 | -7,194 | 9,073 | -676 |
Preferred stock dividends | ' | 782 | ' | 2,346 |
Net income (loss) attributable to common shareholders | ($2,229) | ($7,976) | $9,073 | ($3,022) |
Basic earnings (loss) per common share: (in dollars per share) | ($0.27) | ($0.92) | $1.12 | ($0.35) |
Diluted earnings (loss) per common share: (in dollars per share) | ($0.27) | ($0.90) | $1.09 | ($0.34) |
Average common shares outstanding (in shares) | 8,126 | 8,667 | 8,091 | 8,553 |
Diluted average common shares outstanding (in shares) | 8,329 | 8,889 | 8,332 | 8,846 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income(Loss) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Consolidated Statements of Comprehensive Income (Loss) | ' | ' | ' | ' |
Net income (loss) | ($2,229) | ($7,194) | $9,073 | ($676) |
Derivative instruments | ' | ' | ' | ' |
Unrealized loss on derivative instruments | -8 | -1,213 | -56 | -4,266 |
Reclassification adjustment for losses included in termination of derivative instruments | ' | 10,143 | ' | 10,143 |
Reclassification adjustment for losses included in net income | 390 | 1,810 | 1,149 | 6,026 |
Net gain recognized in other comprehensive income | 382 | 10,740 | 1,093 | 11,903 |
Tax expense related to items of other comprehensive income | -140 | -3,952 | -401 | -4,377 |
Other comprehensive income | 242 | 6,788 | 692 | 7,526 |
Total comprehensive income (loss) | ($1,987) | ($406) | $9,765 | $6,850 |
Consolidated_Statements_of_Sha
Consolidated Statements of Shareholders' Equity (USD $) | Total | Preferred Stock | Common Stock | Paid-in Capital in Excess of par | Accumulated Other Comprehensive Income/(Loss) | Retained Earnings |
In Thousands, unless otherwise specified | ||||||
Balances at Dec. 31, 2011 | $236,661 | $31,915 | $91 | $56,842 | ($8,891) | $156,704 |
Balances (in shares) at Dec. 31, 2011 | ' | ' | 9,110 | ' | ' | ' |
Increase (Decrease) in Shareholders' Equity | ' | ' | ' | ' | ' | ' |
Net income (loss) | -676 | ' | ' | ' | ' | -676 |
Unrealized gain from derivative instruments, net of tax expense of $401 and $644 for the nine months ended September 30, 2013 and September 30, 2012, respectively | 1,116 | ' | ' | ' | 1,116 | ' |
Reclassification adjustment for losses included in net income, net of tax expense of $3,733 | 6,410 | ' | ' | ' | 6,410 | ' |
Preferred stock dividends paid | -2,346 | ' | ' | ' | ' | -2,346 |
Shares repurchased | -1,976 | ' | -2 | -1,974 | ' | ' |
Shares repurchased (in shares) | ' | ' | -156 | ' | ' | ' |
Shares issued under stock compensation plans | 1,312 | ' | 4 | 1,308 | ' | ' |
Shares issued under stock compensation plans (in shares) | ' | ' | 440 | ' | ' | ' |
Cancellation of restricted stock units in satisfaction of withholding tax | -884 | ' | ' | -884 | ' | ' |
Cancellation of restricted stock units in satisfaction of withholding tax (in shares) | ' | ' | -71 | ' | ' | ' |
Stock-based compensation, net of forfeitures | 2,346 | ' | ' | 2,346 | ' | ' |
Excess tax benefit from stock-based compensation | 607 | ' | ' | 607 | ' | ' |
Balances at Sep. 30, 2012 | 242,570 | 31,915 | 93 | 58,245 | -1,365 | 153,682 |
Balances (in shares) at Sep. 30, 2012 | ' | ' | 9,323 | ' | ' | ' |
Balances at Dec. 31, 2012 | 199,553 | ' | 87 | 47,785 | -1,230 | 152,911 |
Balances (in shares) at Dec. 31, 2012 | ' | ' | 8,716 | ' | ' | ' |
Increase (Decrease) in Shareholders' Equity | ' | ' | ' | ' | ' | ' |
Net income (loss) | 9,073 | ' | ' | ' | ' | 9,073 |
Unrealized gain from derivative instruments, net of tax expense of $401 and $644 for the nine months ended September 30, 2013 and September 30, 2012, respectively | 692 | ' | ' | ' | 692 | ' |
Shares repurchased | -5,258 | ' | -3 | -5,255 | ' | ' |
Shares repurchased (in shares) | ' | ' | -354 | ' | ' | ' |
Shares issued under stock compensation plans | 586 | ' | 2 | 584 | ' | ' |
Shares issued under stock compensation plans (in shares) | ' | ' | 182 | ' | ' | ' |
Cancellation of restricted stock units in satisfaction of withholding tax | -738 | ' | -1 | -737 | ' | ' |
Cancellation of restricted stock units in satisfaction of withholding tax (in shares) | ' | ' | -51 | ' | ' | ' |
Stock-based compensation, net of forfeitures | 2,573 | ' | ' | 2,573 | ' | ' |
Balances at Sep. 30, 2013 | $206,481 | ' | $85 | $44,950 | ($538) | $161,984 |
Balances (in shares) at Sep. 30, 2013 | ' | ' | 8,493 | ' | ' | ' |
Consolidated_Statements_of_Sha1
Consolidated Statements of Shareholders' Equity (Parenthetical) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Consolidated Statements of Shareholders' Equity | ' | ' |
Unrealized gain from derivative instruments, tax expense | $401 | $644 |
Reclassification adjustment for losses included in net income, tax expense | ' | $3,733 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Cash flows from operating activities: | ' | ' |
Net income (loss) | $9,073 | ($676) |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation expense | 43,563 | 38,881 |
Write-down of equipment | 6,268 | 2,756 |
Stock-based compensation expenses | 2,573 | 2,346 |
Amortization of deferred costs | 3,068 | 2,874 |
Amortization of loan discount | ' | 341 |
Amortization of interest rate derivative cost | -297 | -167 |
Allowances and provisions | -553 | -154 |
Gain on sale of leased equipment | -3,556 | -4,557 |
Gain on non-monetary exchange | ' | -1,961 |
Income from joint ventures, net of distributions | -3,186 | -471 |
Gain on insurance settlement | -351 | -173 |
Non cash portion of loss of debt extinguishment and derivatives termination | ' | 7,114 |
Deferred income taxes | -8,181 | 405 |
Changes in assets and liabilities: | ' | ' |
Receivables | 8,620 | -289 |
Notes receivable | ' | 542 |
Other assets | -1,517 | 912 |
Accounts payable and accrued expenses | -1,225 | -5,651 |
Restricted cash | -7,127 | 2,064 |
Maintenance reserves | 13,266 | 8,588 |
Security deposits | -492 | 815 |
Unearned lease revenue | -874 | 359 |
Net cash provided by operating activities | 59,072 | 53,898 |
Cash flows from investing activities: | ' | ' |
Proceeds from sale of equipment (net of selling expenses) | 28,482 | 31,971 |
Restricted cash for investing activities | -6,285 | 1,754 |
Capital contribution to joint ventures | -6,145 | -3,830 |
Investment in joint venture, net of cash acquired | 2,020 | ' |
Purchase of equipment held for operating lease and for sale | -93,936 | -46,941 |
Purchase of property, equipment and furnishings | -441 | -1,196 |
Net cash used in investing activities | -76,305 | -18,242 |
Cash flows from financing activities: | ' | ' |
Proceeds from issuance of notes payable | 72,000 | 537,693 |
Debt issuance cost | -591 | -9,660 |
Interest bearing security deposits | 6,071 | ' |
Preferred stock dividends | ' | -2,346 |
Proceeds from shares issued under stock compensation plans | 586 | 1,312 |
Cancellation of restricted stock units in satisfaction of withholding tax | -738 | -884 |
Excess tax benefit from stock-based compensation | ' | 607 |
Decrease in restricted cash | ' | 18,208 |
Repurchase of common stock | -5,258 | -1,976 |
Principal payments on notes payable | -56,188 | -567,871 |
Net cash provided by (used in) financing activities | 15,882 | -24,917 |
Increase (decrease) in cash and cash equivalents | -1,351 | 10,739 |
Cash and cash equivalents at beginning of period | 5,379 | 6,440 |
Cash and cash equivalents at end of period | 4,028 | 17,179 |
Net cash paid for: | ' | ' |
Interest | 25,607 | 14,552 |
Income Taxes | 16 | 101 |
Supplemental disclosures of non-cash investing activities: | ' | ' |
Engines and equipment, transferred from Held for Operating Lease to Held for Sale but not settled | $9,493 | $4,900 |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 9 Months Ended | |||||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||||
Summary of Significant Accounting Policies | ' | |||||||||||||||||||||||||
Summary of Significant Accounting Policies | ' | |||||||||||||||||||||||||
1. Summary of Significant Accounting Policies | ||||||||||||||||||||||||||
(a) Basis of Presentation: Our unaudited consolidated financial statements include the accounts of Willis Lease Finance Corporation and its subsidiaries (“we” or the “Company”) and have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission for reporting on Form 10-Q. Pursuant to such rules and regulations, certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. The accompanying unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto, together with Management’s Discussion and Analysis of Financial Condition and Results of Operations, contained in our Annual Report on Form 10-K/A for the fiscal year ended December 31, 2012. | ||||||||||||||||||||||||||
In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of only normal and recurring adjustments) necessary to present fairly our financial position as of September 30, 2013 and December 31, 2012, and the results of our operations for the three and nine months ended September 30, 2013 and 2012, and our cash flows for the nine months ended September 30, 2013 and 2012. The results of operations and cash flows for the period ended September 30, 2013 are not necessarily indicative of the results of operations or cash flows which may be reported for the remainder of 2013. | ||||||||||||||||||||||||||
Management considers the continuing operations of our company to operate in one reportable segment. | ||||||||||||||||||||||||||
(b) Fair Value Measurements: | ||||||||||||||||||||||||||
Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs, to the extent possible. The standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following: | ||||||||||||||||||||||||||
Level 1 - Quoted prices in active markets for identical assets or liabilities. | ||||||||||||||||||||||||||
Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | ||||||||||||||||||||||||||
Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. | ||||||||||||||||||||||||||
Assets and Liabilities Measured and Recorded at Fair Value on a Recurring Basis | ||||||||||||||||||||||||||
We hold interest rate derivative instruments to mitigate exposure to changes in interest rates, in particular one-month LIBOR, with $343.5 million and $282.0 million of our borrowings at September 30, 2013 and December 31, 2012, respectively, at variable rates. We measure the fair value of our interest rate swaps of $100.0 million (notional amount) based on Level 2 inputs, due to the usage of inputs that can be corroborated by observable market data. The Company estimates the fair value of derivative instruments using a discounted cash flow technique and, at September 30, 2013, has used creditworthiness inputs that corroborate observable market data evaluating the Company’s and counterparties’ risk of non-performance. We have interest rate swap agreements which have a net liability fair value of $0.3 million and $1.7 million as of September 30, 2013 and December 31, 2012, respectively. For the nine months ended September 30, 2013 and September 30, 2012, $1.1 million and $6.0 million, respectively, were realized as interest expense on the Consolidated Statements of Income. | ||||||||||||||||||||||||||
The following table shows by level, within the fair value hierarchy, the Company’s assets and liabilities at fair value as of September 30, 2013 and December 31, 2012: | ||||||||||||||||||||||||||
Assets and (Liabilities) at Fair Value | ||||||||||||||||||||||||||
September 30, 2013 | December 31, 2012 | |||||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Liabilities under derivative instruments | $ | (301 | ) | $ | — | $ | (301 | ) | $ | — | $ | (1,690 | ) | $ | — | $ | (1,690 | ) | $ | — | ||||||
Total | $ | (301 | ) | $ | — | $ | (301 | ) | $ | — | $ | (1,690 | ) | $ | — | $ | (1,690 | ) | $ | — | ||||||
During the nine months ended September 30, 2013 and December 31, 2012, all hedges were effective and no ineffectiveness was recorded in earnings. | ||||||||||||||||||||||||||
Assets Measured and Recorded at Fair Value on a Nonrecurring Basis | ||||||||||||||||||||||||||
We determine the fair value of long-lived assets held and used, such as Equipment held for operating lease and Equipment held for sale, by reference to independent appraisals, quoted market prices (e.g. industry market data) and other factors. An impairment charge is recorded when the carrying value of the asset exceeds its fair value. | ||||||||||||||||||||||||||
The following table shows by level, within the fair value hierarchy, the Company’s assets measured at fair value on a nonrecurring basis as of September 30, 2013 and December 31, 2012, and the gains (losses) recorded during the nine months ended September 30, 2013 and twelve months ended December 31, 2012 on those assets: | ||||||||||||||||||||||||||
Total Losses | ||||||||||||||||||||||||||
Assets at Fair Value (in thousands) | Nine Months Ended | |||||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | September 30, 2013 | ||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Balance at September 30, 2013 | ||||||||||||||||||||||||||
Equipment held for sale | $ | 31,506 | $ | — | $ | 29,839 | $ | 1,667 | $ | (6,268 | ) | |||||||||||||||
Total | $ | 31,506 | $ | — | $ | 29,839 | $ | 1,667 | $ | (6,268 | ) | |||||||||||||||
Total Losses | ||||||||||||||||||||||||||
Assets at Fair Value (in thousands) | Twelve Months Ended | |||||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | December 31, 2012 | ||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Balance at December 31, 2012 | ||||||||||||||||||||||||||
Equipment held for sale | $ | 23,607 | $ | — | $ | 23,384 | $ | 223 | $ | (5,874 | ) | |||||||||||||||
Total | $ | 23,607 | $ | — | $ | 23,384 | $ | 223 | $ | (5,874 | ) | |||||||||||||||
At September 30, 2013, the Company used Level 2 inputs and, due to a portion of the valuations requiring management judgment due to the absence of quoted market prices, Level 3 inputs to measure the fair value of certain engines that were held as inventory not consigned to third parties. The fair values of the assets held for sale categorized as Level 3 were based on management’s estimate considering projected future sales proceeds at September 30, 2013 and December 31, 2012. An impairment charge is recorded when the carrying value of the asset exceeds its fair value. An asset write-down of $3.5 million was recorded in the nine months ended September 30, 2013 based on a comparison of the asset net book values with the proceeds expected from the sale of engines. A further asset write-down of $2.8 million was recorded in the nine months ended September 30, 2013, based upon a comparison of the asset net book values with the revised net proceeds expected from part sales arising from consignment of the engines. An asset write-down of $4.7 million was recorded in the twelve months ended December 31, 2012 based on a comparison of the asset net book values with the proceeds expected from the sale of engines. A further asset write-down of $1.2 million was recorded in the twelve months ended December 31, 2012, based upon a comparison of the asset net book values with the revised net proceeds expected from part sales arising from consignment of the engines. | ||||||||||||||||||||||||||
Management_Estimates
Management Estimates | 9 Months Ended |
Sep. 30, 2013 | |
Management Estimates | ' |
Management Estimates | ' |
2. Management Estimates | |
These consolidated financial statements have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States. | |
The preparation of consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to residual values, estimated asset lives, impairments and bad debts. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. | |
Management believes that the accounting policies on revenue recognition, maintenance reserves and expenditures, useful life of equipment, asset residual values, asset impairment and allowance for doubtful accounts are critical to the results of operations. | |
If the useful lives or residual values are lower than those estimated by us, upon sale of the asset a loss may be realized. Significant management judgment is required in the forecasting of future operating results, which are used in the preparation of projected undiscounted cash-flows and should different conditions prevail, material impairment write-downs may occur. | |
Commitments_Contingencies_Guar
Commitments, Contingencies, Guarantees and Indemnities | 9 Months Ended |
Sep. 30, 2013 | |
Commitments, Contingencies, Guarantees and Indemnities | ' |
Commitments, Contingencies, Guarantees and Indemnities | ' |
3. Commitments, Contingencies, Guarantees and Indemnities | |
Our principal offices are located in Novato, California. We occupy space in Novato under a lease that covers approximately 20,534 square feet of office space and expires September 30, 2018. The remaining lease rental commitment is approximately $2.7 million. Equipment leasing, financing, sales and general administrative activities are conducted from the Novato location. We also sub-lease office and warehouse space for our operations at San Diego, California. This lease expires October 31, 2013 and the remaining lease commitment is approximately $12,000. We also lease office and warehouse space in Shanghai, China. The office lease expires December 31, 2013 and the warehouse lease expires July 31, 2017 and the remaining lease commitments are approximately $16,200 and $27,300, respectively. We also lease office space in London, United Kingdom. The lease expires December 21, 2015 and the remaining lease commitment is approximately $0.2 million. We also lease office space in Blagnac, France. The lease expires December 31, 2013 and the remaining lease commitment is approximately $4,400. We lease office space in Dublin, Ireland. The lease expires May 15, 2017 and the remaining lease commitment is approximately $0.2 million. | |
We have made purchase commitments to secure the purchase of four engines and related equipment for a gross purchase price of $39.3 million, for delivery in 2013 to 2015. As of September 30, 2013, non-refundable deposits paid related to these purchase commitments were $1.4 million. In October 2006, we entered into an agreement with CFM International (“CFM”) to purchase new spare aircraft engines. The agreement specifies that, subject to availability, we may purchase up to a total of 45 CFM56-7B and CFM56-5B spare engines over a five year period, with options to acquire up to an additional 30 engines. Our outstanding purchase orders with CFM for three engines represent deferral of engine deliveries originally scheduled for 2009 and are included in our commitments to purchase in 2013 to 2015. | |
Investments
Investments | 9 Months Ended | ||||||||||
Sep. 30, 2013 | |||||||||||
Investments | ' | ||||||||||
Investments | ' | ||||||||||
4. Investments | |||||||||||
On May 25, 2011, we entered into an agreement with Mitsui & Co., Ltd. to participate in a joint venture formed as a Dublin-based Irish limited company, Willis Mitsui & Company Engine Support Limited (“WMES”) for the purpose of acquiring and leasing jet engines. Each partner holds a fifty percent interest in the joint venture. The initial capital contribution by the Company for its investment in WMES was $8.0 million. The Company provided the initial lease portfolio by transferring 7 engines to the joint venture in June 2011. In addition, the Company made $1.0 million, $5.6 million and $6.1 million capital contributions to WMES in the years ended December 31, 2011, 2012 and the nine months ended September 30, 2013, respectively, for the purchase of 16 engines from third parties, increasing the number of engines in the lease portfolio to 23. Mitsui & Co., Ltd. contributed equally the capital contribution to support all of these purchases. The $20.7 million of capital contributions has been partially offset by $3.6 million, resulting in a net investment of $17.1 million, which has increased to $18.1 million as a result of the Company’s share of WMES reported earnings to date. The $3.6 million reduction in investment represents 50% of the $7.2 million gain related to the sale by the Company of the 7 engines to WMES. | |||||||||||
WMES has a loan agreement with JA Mitsui Leasing, Ltd. which provides a credit facility of up to $180.0 million to support the funding of future engine acquisitions. Funds are available under the loan agreement have been extended through March 31, 2014. WMES also established a separate credit facility for $8.0 million to fund the purchase of an engine, which is repayable over the 7 year term of the facility. Our investment in the joint venture is $18.1 million and $11.8 million as of September 30, 2013 and December 31, 2012, respectively. | |||||||||||
Prior to September 18, 2013, we held a fifty percent membership interest in a joint venture, WOLF A340, LLC, a Delaware limited liability company, (“WOLF”). On December 30, 2005, WOLF completed the purchase of two Airbus A340-313 aircraft from Boeing Aircraft Holding Company for a purchase price of $96.0 million. The purchase was funded by four term notes with one financial institution totaling $76.8 million, with interest payable at one-month LIBOR plus 1.0% to 2.5% and matured in May 2013. Two of the term notes were paid off in May 2013 and the remaining two term notes totaling $36.0 million were amended and extended, with a maturity date of May 2017 and interest payable at one-month LIBOR plus 4.0%. At June 30, 2013, the return of both aircraft from the prior lessee, Emirates, had been completed. As part of the lease return process, upon termination of the aircraft leases, Emirates made maintenance reserve payments totaling $9.0 million, which was recorded by WOLF as maintenance reserve revenue in the period ended June 30, 2013. The airframes are being disassembled and parted out and the eight engines are being marketed for lease separately to airline customers. | |||||||||||
On September 18, 2013, we completed the acquisition of the fifty percent membership interest held by the other joint venture partner in WOLF for a purchase price of $1.0 million, with the purchase price representing a $12.7 million discount from the JV partner’s equity interest. The transaction is being accounted for as an asset acquisition. We recorded the assets at the cost basis, which represents the allocation of our prior investment basis plus the cash paid to the third party investor. | |||||||||||
The purchase price was allocated to the eight aircraft engines and two airframes. The fair value of the net assets acquired from this transaction is estimated to be $12.6 million, which comprised of $27.0 million of equipment, $1.6 million of cash and receivables, offset by $16.0 million of debt and other liabilities. As a result of the transaction, we now own one hundred percent of WOLF. The WOLF balance sheet and the results of operations related to the WOLF assets have been included in the accompanying consolidated financial statements as of the acquisition date, September 18, 2013. | |||||||||||
Nine Months Ended September 30, 2013 (in thousands) | WOLF | WMES | Total | ||||||||
Investment in joint ventures as of December 31, 2012 | $ | 10,065 | $ | 11,766 | $ | 21,831 | |||||
Capital contribution | — | 6,145 | 6,145 | ||||||||
Earnings from joint ventures | 3,025 | 161 | 3,186 | ||||||||
Distribution | — | — | — | ||||||||
Transfer to consolidated subsidiary | (13,090 | ) | — | (13,090 | ) | ||||||
Investment in joint ventures as of September 30, 2013 | $ | — | $ | 18,072 | $ | 18,072 | |||||
Long_Term_Debt
Long Term Debt | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Long Term Debt | ' | ||||
Long Term Debt | ' | ||||
5. Long Term Debt | |||||
At September 30, 2013, notes payable consists of loans totaling $744.3 million, payable over periods of approximately four months to nine years with interest rates varying between approximately 3.2% and 5.5% (excluding the effect of our interest rate derivative instruments). | |||||
Our significant debt instruments are discussed below: | |||||
At September 30, 2013, we had a $450.0 million revolving credit facility to finance the acquisition of aircraft engines for lease as well as for general working capital purposes. We closed on this facility on November 18, 2011 and the proceeds of the facility, net of $3.3 million in debt issuance costs, was used to pay off the balance remaining from our prior revolving facility. On June 18, 2013, we increased this revolving credit facility to $450.0 million from $430.0 million. As of September 30, 2013 and December 31, 2012, $138.0 million and $148.0 million was available under this facility, respectively. The revolving credit facility ends in November 2016. Based on the Company’s debt to equity ratio of 3.80, as calculated under the terms of the revolving credit facility at June 30, 2013, the interest rate on this facility is LIBOR plus 3.00% as of September 30, 2013. Under the revolving credit facility, all subsidiaries except WEST II and WOLF jointly and severally guarantee payment and performance of the terms of the loan agreement. The guarantee would be triggered by a default under the agreement. | |||||
On September 17, 2012, we closed an asset-backed securitization (“ABS”) through a newly-created, bankruptcy-remote, Delaware statutory trust, Willis Engine Securitization Trust II, or “WEST II”, of which the Company is the sole beneficiary. WEST II issued and sold $390 million aggregate principal amount of Class 2012-A Term Notes (the “Notes”) and received $384.9 million in net proceeds. We used these funds, net of transaction expenses and swap termination costs, in combination with our revolving credit facility, to pay off the prior WEST notes totaling $435.9 million. At closing, 22 engines were pledged as collateral from WEST to the Company’s revolving credit facility, which provided the remaining funds to pay off the WEST notes. | |||||
The assets and liabilities of WEST II will remain on the Company’s balance sheet. A portfolio of 79 commercial jet aircraft engines and leases thereof secures the obligations of WEST II under the ABS. The Notes have no fixed amortization and are payable solely from revenue received by WEST II from the engines and the engine leases, after payment of certain expenses of WEST II. The Notes bear interest at a fixed rate of 5.50% per annum. The Notes may be accelerated upon the occurrence of certain events, including the failure to pay interest for five business days after the due date thereof. The Notes are expected to be paid 10 years from the issuance date by September 17, 2022. The legal final maturity of the Notes is September 15, 2037. | |||||
In connection with the transactions described above, effective September 17, 2012, the Servicing Agreement and Administrative Agency Agreement previously filed by the Company as exhibits to, and described in, its Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2005 relating to WEST were terminated. The Company entered into a Servicing Agreement and Administrative Agency Agreement with WEST II to provide certain engine, lease management and reporting functions for WEST II in return for fees based on a percentage of collected lease revenues and asset sales. Because WEST II is consolidated for financial statement reporting purposes, all fees eliminate upon consolidation. | |||||
At September 30, 2013 and December 31, 2012, $375.0 million and $386.7 million of WEST II term notes were outstanding, respectively. The assets of WEST II are not available to satisfy our obligations or any of our affiliates other than the obligations specific to WEST II. WEST II is consolidated for financial statement presentation purposes. WEST II’s ability to make distributions and pay dividends to the Company is subject to the prior payments of its debt and other obligations and WEST II’s maintenance of adequate reserves and capital. Under WEST II, cash is collected in a restricted account, which is used to service the debt and any remaining amounts, after debt service and defined expenses, are distributed to the Company. Additionally, a portion of maintenance reserve payments and all lease security deposits are accumulated in restricted accounts and are available to fund future maintenance events and to secure lease payments, respectively. Cash from maintenance reserve payments are held in the restricted cash account equal to the maintenance obligations projected for the subsequent six months, and are subject to a minimum balance of $9.0 million. | |||||
On September 18, 2013, we completed the acquisition of the fifty percent membership interest held by the other joint venture partner in WOLF, with the transaction being accounted for as an asset acquisition. With this acquisition, WOLF is consolidated for financial statement presentation purposes. Two term notes with an original principal amount of $36.0 million, with a current balance outstanding of $31.5 million as of September 30, 2013, are included in Notes payable. The two term notes are non-recourse to the Company, have a maturity date of May 2017 and interest is payable at one-month LIBOR plus 4.0%. | |||||
The assets of WOLF are not available to satisfy our obligations or any of our affiliates other than the obligations specific to WOLF. WOLF’s ability to make distributions to the Company is subject to the prior payments of all of its debt and other obligations. Under WOLF, cash related to parts sale and leasing of engine assets is collected in a restricted account and used to pay certain operating expenses, service the debt, and upon full debt repayment are distributed to the Company. | |||||
On September 28, 2012, we closed on a loan for a five year term totaling $8.7 million. Interest is payable monthly at a fixed rate of 5.50% and principal is paid quarterly. The loan is secured by one engine. The funds were used to purchase the engine secured under the loan. The balance outstanding on this loan is $8.3 million and $8.6 million as of September 30, 2013 and December 31, 2012, respectively. | |||||
On September 30, 2011, we closed on a loan for a three year term totaling $4.0 million. Interest is payable at a fixed rate of 3.94% and principal and interest is paid monthly. The loan is secured by our corporate aircraft. The funds were used to refinance the loan for our corporate aircraft. The balance outstanding on this loan is $1.3 million and $2.3 million as of September 30, 2013 and December 31, 2012, respectively. | |||||
On January 11, 2010, we closed on a loan for a four year term totaling $22.0 million, the proceeds of which were used to pay down our revolving credit facility. Interest is payable at a fixed rate of 4.50% and principal and interest is paid quarterly. The loan is secured by three engines. The balance outstanding on this loan is $16.2 million and $17.3 million as of September 30, 2013 and December 31, 2012, respectively. | |||||
Virtually all of the debt instruments above have covenant requirements such as minimum tangible net worth, maximum balance sheet leverage and various interest coverage ratios. The Company also has certain negative financial covenants such as liens, advances, change in business, sales of assets, dividends and stock repurchase. These covenants are tested quarterly and the Company was in full compliance with all covenant requirements at September 30, 2013. | |||||
At September 30, 2013, we are in compliance with the covenants specified in the revolving credit facility Credit Agreement, including the Interest Coverage Ratio requirement of at least 2.50 to 1.00, and the Total Leverage Ratio requirement to remain below 4.75 to 1.00. At September 30, 2013, the Company’s calculated Minimum Consolidated Tangible Net Worth exceeded the minimum required amount of $191.1 million. As defined in the revolving credit facility Credit Agreement, the Interest Coverage Ratio is the ratio of Earnings before Interest, Taxes, Depreciation and Amortization and other one-time charges (EBITDA) to Consolidated Interest Expense and the Total Leverage Ratio is the ratio of Total Indebtedness to Tangible Net Worth. At September 30, 2013, we are in compliance with the covenants specified in the WEST II indenture and servicing agreement. | |||||
At September 30, 2013 and 2012, one-month LIBOR was 0.18% and 0.21%, respectively. | |||||
The following is a summary of the aggregate maturities of notes payable at September 30, 2013: | |||||
Year | (in thousands) | ||||
2013 | $ | 11,186 | |||
2014 | 42,023 | ||||
2015 | 32,934 | ||||
2016 (includes $312.0 million outstanding on revolving credit facility) | 338,215 | ||||
2017 | 32,873 | ||||
Thereafter | 287,069 | ||||
$ | 744,300 | ||||
Derivative_Instruments
Derivative Instruments | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Derivative Instruments | ' | |||||||||||||||
Derivative Instruments | ' | |||||||||||||||
6. Derivative Instruments | ||||||||||||||||
We hold interest rate derivative instruments to mitigate exposure to changes in interest rates, in particular one-month LIBOR, with $343.5 million and $282.0 million of our borrowings at September 30, 2013 and December 31, 2012, respectively, at variable rates. As a matter of policy, we do not use derivatives for speculative purposes. At September 30, 2013 and December 31, 2012, under our revolving credit facility, we were a party to one interest rate swap agreement with a notional outstanding amount of $100.0 million with a fixed rate of 2.10% and a remaining term of two months as of September 30, 2013. The net fair value of the swap at September 30, 2013 and December 31, 2012 was negative $0.3 million and negative $1.7 million, respectively, representing a net liability for us. The amount represents the estimated amount we would be required to pay if we terminated the swap. | ||||||||||||||||
The Company estimates the fair value of derivative instruments using a discounted cash flow technique and, as of September 30, 2013, has used creditworthiness inputs that can be corroborated by observable market data evaluating the Company’s and counterparties’ risk of non-performance. Valuation of the derivative instruments requires certain assumptions for underlying variables and the use of different assumptions would result in a different valuation. Management believes it has applied assumptions consistently during the period. We apply hedge accounting and account for the change in fair value of our cash flow hedges through other comprehensive income for all derivative instruments. | ||||||||||||||||
Based on the implied forward rate for LIBOR at September 30, 2013, we anticipate that net finance costs will be increased by approximately $0.3 million for the 12 months ending September 30, 2014 due to the interest rate derivative contract currently in place. | ||||||||||||||||
Fair Values of Derivative Instruments in the Consolidated Balance Sheets | ||||||||||||||||
The following table provides information about the fair value of our derivatives, by contract type: | ||||||||||||||||
Derivatives | ||||||||||||||||
Fair Value | ||||||||||||||||
Derivatives Designated as | Balance Sheet Location | September 30, | December 31, | |||||||||||||
Hedging Instruments | 2013 | 2012 | ||||||||||||||
(in thousands) | ||||||||||||||||
Interest rate contracts | Liabilities under derivative instruments | $ | 301 | $ | 1,690 | |||||||||||
Earnings Effects of Derivative Instruments on the Consolidated Statements of Income | ||||||||||||||||
The following table provides information about the income effects of our cash flow hedging relationships for the three and nine months ended September 30, 2013 and 2012: | ||||||||||||||||
Amount of Loss Recognized | ||||||||||||||||
on Derivatives in the | ||||||||||||||||
Statements of Income | ||||||||||||||||
Derivatives in Cash Flow | Location of Loss Recognized on Derivatives in | Three Months Ended | ||||||||||||||
September 30, | ||||||||||||||||
Hedging Relationships | the Statements of Income | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Interest rate contracts | Interest expense | $ | 390 | $ | 1,810 | |||||||||||
Reclassification adjustment for losses included in termination of derivative instruments | Loss on debt extinguishment and derivative termination | $ | — | $ | 10,143 | |||||||||||
Total | $ | 390 | $ | 11,953 | ||||||||||||
Amount of Loss Recognized | ||||||||||||||||
on Derivatives in the | ||||||||||||||||
Statements of Income | ||||||||||||||||
Derivatives in Cash Flow | Location of Loss Recognized on Derivatives in | Nine Months Ended | ||||||||||||||
September 30, | ||||||||||||||||
Hedging Relationships | the Statements of Income | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Interest rate contracts | Interest expense | $ | 1,149 | $ | 6,026 | |||||||||||
Reclassification adjustment for losses included in termination of derivative instruments | Loss on debt extinguishment and derivative termination | $ | — | $ | 10,143 | |||||||||||
Total | $ | 1,149 | $ | 16,169 | ||||||||||||
Our derivatives are designated in a cash flow hedging relationship with the effective portion of the change in fair value of the derivative reported in the cash flow hedges subaccount of accumulated other comprehensive income. | ||||||||||||||||
Effect of Derivative Instruments on Cash Flow Hedging | ||||||||||||||||
The following tables provide additional information about the financial statement effects related to our cash flow hedges for the three and nine months ended September 30, 2013 and 2012: | ||||||||||||||||
Amount of Gain Recognized in OCI on | Location of Loss Reclassified | Amount of Loss Reclassified | ||||||||||||||
Derivatives | from Accumulated OCI into | |||||||||||||||
(Effective Portion) | Income | |||||||||||||||
(Effective Portion) | ||||||||||||||||
Derivatives in Cash Flow | Three Months Ended | from Accumulated OCI into | Three Months Ended | |||||||||||||
September 30, | Income | September 30, | ||||||||||||||
Hedging Relationships | 2013 | 2012 | (Effective Portion) | 2013 | 2012 | |||||||||||
(in thousands) | (in thousands) | |||||||||||||||
Interest rate contracts* | $ | (480 | ) | $ | (1,191 | ) | Interest expense | $ | (390 | ) | $ | (1,810 | ) | |||
Total | $ | (480 | ) | $ | (1,191 | ) | Total | $ | (390 | ) | $ | (1,810 | ) | |||
Amount of Gain Recognized in OCI on | Location of Loss Reclassified | Amount of Loss Reclassified | ||||||||||||||
Derivatives | from Accumulated OCI into | |||||||||||||||
(Effective Portion) | Income | |||||||||||||||
(Effective Portion) | ||||||||||||||||
Derivatives in Cash Flow | Nine Months Ended | from Accumulated OCI into | Nine Months Ended | |||||||||||||
September 30, | Income | September 30, | ||||||||||||||
Hedging Relationships | 2013 | 2012 | (Effective Portion) | 2013 | 2012 | |||||||||||
(in thousands) | (in thousands) | |||||||||||||||
Interest rate contracts** | $ | (1,389 | ) | $ | 83 | Interest expense | $ | (1,149 | ) | $ | (6,026 | ) | ||||
Total | $ | (1,389 | ) | $ | 83 | Total | $ | (1,149 | ) | $ | (6,026 | ) | ||||
* These amounts are shown net of $0.5 million and $1.9 million of other comprehensive income reclassified to the income statement during the three months ended September 30, 2013 and 2012, respectively. | ||||||||||||||||
* * These amounts are shown net of $1.4 million and $6.2 million of other comprehensive income reclassified to the income statement during the nine months ended September 30, 2013 and 2012, respectively. | ||||||||||||||||
The effective portion of the change in fair value on a derivative instrument designated as a cash flow hedge is reported as a component of accumulated other comprehensive income and is reclassified into earnings in the period during which the transaction being hedged affects earnings or it is probable that the forecasted transaction will not occur. The ineffective portion of the hedges is recorded in earnings in the current period. However, these are highly effective hedges and no significant ineffectiveness occurred in either period presented. | ||||||||||||||||
Counterparty Credit Risk | ||||||||||||||||
The Company evaluates the creditworthiness of the counterparties under its hedging agreements. The swap counterparty for the interest rate swap in place at September 30, 2013 is a large financial institution in the United States that possesses an investment grade credit rating. Based on this rating, the Company believes that the counterparty is currently creditworthy and that their continuing performance under the hedging agreement is probable, and has not required the counterparty to provide collateral or other security to the Company. | ||||||||||||||||
StockBased_Compensation_Plans
Stock-Based Compensation Plans | 9 Months Ended | |||
Sep. 30, 2013 | ||||
Stock-Based Compensation Plans | ' | |||
Stock-Based Compensation Plans | ' | |||
7. Stock-Based Compensation Plans | ||||
Our 2007 Stock Incentive Plan (the 2007 Plan) was adopted on May 24, 2007. Under this 2007 Plan, a total of 2,000,000 shares are authorized for stock based compensation in the form of either restricted stock or stock options. There have been 1,781,858 shares of restricted stock awarded to date, net of cancellations. The fair value of the restricted stock awards equaled the stock price at the date of grants. The following table summarizes restricted stock activity during the years ended December 31, 2011, December 31, 2012 and the nine months ended September 30, 2013: | ||||
Shares | ||||
Restricted stock at December 31, 2010 | 575,791 | |||
Granted in 2011 (vesting over 4 years) | 324,924 | |||
Granted in 2011 (vesting on first anniversary from date of issuance) | 22,100 | |||
Cancelled in 2011 | (27,477 | ) | ||
Vested in 2011 | (244,044 | ) | ||
Restricted stock at December 31, 2011 | 651,294 | |||
Granted in 2012 (vesting over 4 years) | 283,000 | |||
Granted in 2012 (vesting on first anniversary from date of issuance) | 28,040 | |||
Cancelled in 2012 | (8,988 | ) | ||
Vested in 2012 | (270,692 | ) | ||
Restricted stock at December 31, 2012 | 682,654 | |||
Granted in 2013 (vesting over 4 years) | 130,000 | |||
Granted in 2013 (vesting on first anniversary from date of issuance) | 21,408 | |||
Cancelled in 2013 | (28,198 | ) | ||
Vested in 2013 | (179,616 | ) | ||
Restricted Stock at September 30, 2013 | 626,248 | |||
All cancelled shares have reverted to the share reserve and are available for issuance at a later date, in accordance with the 2007 Plan. | ||||
Our accounting policy is to recognize the associated expense of such awards on a straight-line basis over the vesting period. Approximately $2.5 million and $2.3 million in stock compensation expense were recorded in the nine months ended September 30, 2013 and September 30, 2012, respectively. The stock compensation expense related to the restricted stock awards will be recognized over the average remaining vesting period of 2.25 years and totals $6.7 million at September 30, 2013 compared to 2.3 years and totaling $6.5 million at September 30, 2012. At September 30, 2013, the intrinsic value of unvested restricted stock awards issued through September 30, 2013 is $9.9 million. At September 30, 2012, the intrinsic value of unvested restricted stock awards issued through September 30, 2012 was $7.8 million. The 2007 Plan terminates on May 24, 2017. | ||||
In the nine months ended September 30, 2013, 44,991 options under the 1996 Stock Options/Stock Issuance Plan (the 1996 Plan) were exercised and 6,500 options were canceled. As of September 30, 2013, there are 85,437 stock options remaining under the 1996 Plan which have an intrinsic value of $0.5 million. In the nine months ended September 30, 2012, 232,314 options under the 1996 Plan were exercised. As of September 30, 2012, there were 211,267 stock options remaining under the 1996 Plan having an intrinsic value of $0.9 million. | ||||
Income_Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2013 | |
Income Taxes | ' |
Income Taxes | ' |
8. Income Taxes | |
Income tax expense (benefit) for the nine months ended September 30, 2013 and 2012 was ($8.2 million) and $0.4 million, respectively. The effective tax rate for the nine months ended September 30, 2013 and 2012 was 43.6% and 149.4%, respectively. The effective rate for the nine months ended September 30, 2013 differs from the U.S. federal statutory rate primarily due to an income tax benefit of $8.6 million related to an extraterritorial income (“ETI”) adjustment recorded in the second quarter period for certain of our engines. We recognized this income tax benefit in the current period resulting from adjustments made to the tax basis of certain of our engines due to a decision in a recent court case on behalf of another company in which our circumstances are similar. The Company records tax expense or benefit for unusual or infrequent items discretely in the period in which they occur. The effective tax rate for the nine months ended September 30, 2012 differs from the U.S. federal statutory rate primarily due to our loss on debt extinguishment and derivatives termination resulted in a $5.3 million tax benefit in the period, significantly reducing our effective tax rate in the third quarter a year ago. Our tax rate is subject to change based on changes in the mix of assets leased to domestic and foreign lessees, the proportions of revenue generated within and outside of California, the amount of executive compensation exceeding $1.0 million as defined in IRS code 162(m) and numerous other factors, including changes in tax law. | |
Related_Party_and_Similar_Tran
Related Party and Similar Transactions | 9 Months Ended |
Sep. 30, 2013 | |
Related Party and Similar Transactions | ' |
Related Party and Similar Transactions | ' |
9. Related Party and Similar Transactions | |
J.T. Power: The Company entered into two Consignment Agreements dated January 22, 2008 and November 17, 2008, with J.T. Power, LLC (“J.T. Power”), an entity whose sole shareholder, Austin Willis, is the son of our Chief Executive Officer, and directly and indirectly, a shareholder and a Director of the Company. According to the terms of the Consignment Agreement, J.T. Power was responsible to market and sell parts from the teardown of four engines with a book value of $5.2 million. During the nine months ended September 30, 2013 and September 30, 2012, sales of consigned parts were $19,900 and $14,700, respectively. Under these agreements, J.T. Power provided a minimum guarantee of net consignment proceeds of $4.0 million as of February 22, 2012. Based on current consignment proceeds, J.T. Power was obligated to pay $1.3 million under the guarantee in February 2012. On March 7, 2012, this guarantee was restructured as follows - quarterly payments of $45,000 over five years at an interest rate of 6% with a balloon payment at the end of this five year term. The Agreement provides an option to skip one quarterly payment and apply it to the balloon payment at an interest rate of 12%. As of September 30, 2013, J.T. Power is current and the principal amount owing under the note is $1.1 million. | |
On July 31, 2009, the Company entered into Consignment Agreements with J.T. Power, without guaranties of consignment proceeds, in which they are responsible to market and sell parts from the teardown of one engine with a book value of $23,000. During the nine months ended September 30, 2013 and September 30, 2012, sales of consigned parts were $1,700 and $54,200, respectively. | |
On July 27, 2006, the Company entered into an Aircraft Engine Agency Agreement with J.T. Power, in which the Company will, on a non-exclusive basis, provide engine lease opportunities with respect to available spare engines at J.T. Power. J.T. Power will pay the Company a fee based on a percentage of the rent collected by J.T. Power for the duration of the lease including renewals thereof. The Company earned no revenue during the nine months ended September 30, 2013 and September 30, 2012 under this program. | |
On November 6, 2013, the Company entered into an Asset Purchase Agreement for the purchase of certain assets of J.T. Power for $5.9 million. A net cash payment of $4.5 million was made to fund the transaction, after deducting amounts owed to the Company, including $1.1 million related to the minimum guarantee related to an existing consignment program. Of the $4.5 million cash payment, $1.2 million was paid to various creditors and $3.3 million was paid to the shareholders of J.T. Power. | |
Fair_Value_of_Financial_Instru
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2013 | |
Fair Value of Financial Instruments | ' |
Fair Value of Financial Instruments | ' |
10. Fair Value of Financial Instruments | |
The carrying amount reported in the consolidated balance sheets for cash and cash equivalents, restricted cash, operating lease related receivable and accounts payable approximates fair value because of the immediate or short-term maturity of these financial instruments. | |
The carrying amount of the Company’s outstanding balance on its Notes Payable as of September 30, 2013 and December 31, 2012 was estimated to have a fair value of approximately $761.0 million and $697.3 million, respectively, based on the fair value of estimated future payments calculated using the prevailing interest rates at each period end. There have been no changes in our valuation technique during the nine months ended September 30, 2013. The fair value of the Company’s notes payable at September 30, 2013 would be categorized as Level 3 of the fair value hierarchy. The carrying value of the Company’s outstanding balance on its notes payable was $744.3 million as of September 30, 2013 and $697.0 million as of December 31, 2012. | |
Subsequent_Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2013 | |
Subsequent Events | ' |
Subsequent Events | ' |
11. Subsequent Events | |
Management has reviewed and evaluated subsequent events through the date that the financial statements were issued. On November 6, 2013, the Company entered into an Asset Purchase Agreement for the purchase of certain assets of J.T. Power for $5.9 million. A net cash payment of $4.5 million was made to fund the transaction, after deducting amounts owed to the Company, including $1.1 million related to the minimum guarantee related to an existing consignment program. Of the $4.5 million cash payment, $1.2 million was paid to various creditors and $3.3 million was paid to the shareholders of J.T. Power. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2013 | |
Summary of Significant Accounting Policies | ' |
Basis of Presentation: | ' |
(a) Basis of Presentation: Our unaudited consolidated financial statements include the accounts of Willis Lease Finance Corporation and its subsidiaries (“we” or the “Company”) and have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission for reporting on Form 10-Q. Pursuant to such rules and regulations, certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. The accompanying unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto, together with Management’s Discussion and Analysis of Financial Condition and Results of Operations, contained in our Annual Report on Form 10-K/A for the fiscal year ended December 31, 2012. | |
In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of only normal and recurring adjustments) necessary to present fairly our financial position as of September 30, 2013 and December 31, 2012, and the results of our operations for the three and nine months ended September 30, 2013 and 2012, and our cash flows for the nine months ended September 30, 2013 and 2012. The results of operations and cash flows for the period ended September 30, 2013 are not necessarily indicative of the results of operations or cash flows which may be reported for the remainder of 2013. | |
Management considers the continuing operations of our company to operate in one reportable segment. | |
Fair Value Measurements: | ' |
(b) Fair Value Measurements: | |
Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs, to the extent possible. The standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value which are the following: | |
Level 1 - Quoted prices in active markets for identical assets or liabilities. | |
Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | |
Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. | |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 9 Months Ended | |||||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||||
Summary of Significant Accounting Policies | ' | |||||||||||||||||||||||||
Schedule of fair value hierarchy of assets and liabilities measured on recurring basis | ' | |||||||||||||||||||||||||
Assets and (Liabilities) at Fair Value | ||||||||||||||||||||||||||
September 30, 2013 | December 31, 2012 | |||||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Liabilities under derivative instruments | $ | (301 | ) | $ | — | $ | (301 | ) | $ | — | $ | (1,690 | ) | $ | — | $ | (1,690 | ) | $ | — | ||||||
Total | $ | (301 | ) | $ | — | $ | (301 | ) | $ | — | $ | (1,690 | ) | $ | — | $ | (1,690 | ) | $ | — | ||||||
Schedule of fair value hierarchy of assets measured on nonrecurring basis and gain (losses) recorded | ' | |||||||||||||||||||||||||
Total Losses | ||||||||||||||||||||||||||
Assets at Fair Value (in thousands) | Nine Months Ended | |||||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | September 30, 2013 | ||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Balance at September 30, 2013 | ||||||||||||||||||||||||||
Equipment held for sale | $ | 31,506 | $ | — | $ | 29,839 | $ | 1,667 | $ | (6,268 | ) | |||||||||||||||
Total | $ | 31,506 | $ | — | $ | 29,839 | $ | 1,667 | $ | (6,268 | ) | |||||||||||||||
Total Losses | ||||||||||||||||||||||||||
Assets at Fair Value (in thousands) | Twelve Months Ended | |||||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | December 31, 2012 | ||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Balance at December 31, 2012 | ||||||||||||||||||||||||||
Equipment held for sale | $ | 23,607 | $ | — | $ | 23,384 | $ | 223 | $ | (5,874 | ) | |||||||||||||||
Total | $ | 23,607 | $ | — | $ | 23,384 | $ | 223 | $ | (5,874 | ) | |||||||||||||||
Investments_Tables
Investments (Tables) | 9 Months Ended | ||||||||||
Sep. 30, 2013 | |||||||||||
Investments | ' | ||||||||||
Schedule of investments | ' | ||||||||||
Nine Months Ended September 30, 2013 (in thousands) | WOLF | WMES | Total | ||||||||
Investment in joint ventures as of December 31, 2012 | $ | 10,065 | $ | 11,766 | $ | 21,831 | |||||
Capital contribution | — | 6,145 | 6,145 | ||||||||
Earnings from joint ventures | 3,025 | 161 | 3,186 | ||||||||
Distribution | — | — | — | ||||||||
Transfer to consolidated subsidiary | (13,090 | ) | — | (13,090 | ) | ||||||
Investment in joint ventures as of September 30, 2013 | $ | — | $ | 18,072 | $ | 18,072 | |||||
Long_Term_Debt_Tables
Long Term Debt (Tables) | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Long Term Debt | ' | ||||
Summary of the aggregate maturities of notes payable | ' | ||||
Year | (in thousands) | ||||
2013 | $ | 11,186 | |||
2014 | 42,023 | ||||
2015 | 32,934 | ||||
2016 (includes $312.0 million outstanding on revolving credit facility) | 338,215 | ||||
2017 | 32,873 | ||||
Thereafter | 287,069 | ||||
$ | 744,300 | ||||
Derivative_Instruments_Tables
Derivative Instruments (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Derivative Instruments | ' | |||||||||||||||
Schedule of fair value of derivatives by contract type | ' | |||||||||||||||
Derivatives | ||||||||||||||||
Fair Value | ||||||||||||||||
Derivatives Designated as | Balance Sheet Location | September 30, | December 31, | |||||||||||||
Hedging Instruments | 2013 | 2012 | ||||||||||||||
(in thousands) | ||||||||||||||||
Interest rate contracts | Liabilities under derivative instruments | $ | 301 | $ | 1,690 | |||||||||||
Schedule of income effects of cash flow hedging relationships | ' | |||||||||||||||
Amount of Loss Recognized | ||||||||||||||||
on Derivatives in the | ||||||||||||||||
Statements of Income | ||||||||||||||||
Derivatives in Cash Flow | Location of Loss Recognized on Derivatives in | Three Months Ended | ||||||||||||||
September 30, | ||||||||||||||||
Hedging Relationships | the Statements of Income | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Interest rate contracts | Interest expense | $ | 390 | $ | 1,810 | |||||||||||
Reclassification adjustment for losses included in termination of derivative instruments | Loss on debt extinguishment and derivative termination | $ | — | $ | 10,143 | |||||||||||
Total | $ | 390 | $ | 11,953 | ||||||||||||
Amount of Loss Recognized | ||||||||||||||||
on Derivatives in the | ||||||||||||||||
Statements of Income | ||||||||||||||||
Derivatives in Cash Flow | Location of Loss Recognized on Derivatives in | Nine Months Ended | ||||||||||||||
September 30, | ||||||||||||||||
Hedging Relationships | the Statements of Income | 2013 | 2012 | |||||||||||||
(in thousands) | ||||||||||||||||
Interest rate contracts | Interest expense | $ | 1,149 | $ | 6,026 | |||||||||||
Reclassification adjustment for losses included in termination of derivative instruments | Loss on debt extinguishment and derivative termination | $ | — | $ | 10,143 | |||||||||||
Total | $ | 1,149 | $ | 16,169 | ||||||||||||
Schedule of information about financial statement effects related to cash flow hedges | ' | |||||||||||||||
Amount of Gain Recognized in OCI on | Location of Loss Reclassified | Amount of Loss Reclassified | ||||||||||||||
Derivatives | from Accumulated OCI into | |||||||||||||||
(Effective Portion) | Income | |||||||||||||||
(Effective Portion) | ||||||||||||||||
Derivatives in Cash Flow | Three Months Ended | from Accumulated OCI into | Three Months Ended | |||||||||||||
September 30, | Income | September 30, | ||||||||||||||
Hedging Relationships | 2013 | 2012 | (Effective Portion) | 2013 | 2012 | |||||||||||
(in thousands) | (in thousands) | |||||||||||||||
Interest rate contracts* | $ | (480 | ) | $ | (1,191 | ) | Interest expense | $ | (390 | ) | $ | (1,810 | ) | |||
Total | $ | (480 | ) | $ | (1,191 | ) | Total | $ | (390 | ) | $ | (1,810 | ) | |||
Amount of Gain Recognized in OCI on | Location of Loss Reclassified | Amount of Loss Reclassified | ||||||||||||||
Derivatives | from Accumulated OCI into | |||||||||||||||
(Effective Portion) | Income | |||||||||||||||
(Effective Portion) | ||||||||||||||||
Derivatives in Cash Flow | Nine Months Ended | from Accumulated OCI into | Nine Months Ended | |||||||||||||
September 30, | Income | September 30, | ||||||||||||||
Hedging Relationships | 2013 | 2012 | (Effective Portion) | 2013 | 2012 | |||||||||||
(in thousands) | (in thousands) | |||||||||||||||
Interest rate contracts** | $ | (1,389 | ) | $ | 83 | Interest expense | $ | (1,149 | ) | $ | (6,026 | ) | ||||
Total | $ | (1,389 | ) | $ | 83 | Total | $ | (1,149 | ) | $ | (6,026 | ) | ||||
* These amounts are shown net of $0.5 million and $1.9 million of other comprehensive income reclassified to the income statement during the three months ended September 30, 2013 and 2012, respectively. | ||||||||||||||||
* * These amounts are shown net of $1.4 million and $6.2 million of other comprehensive income reclassified to the income statement during the nine months ended September 30, 2013 and 2012, respectively. | ||||||||||||||||
StockBased_Compensation_Plans_
Stock-Based Compensation Plans (Tables) (Restricted stock) | 9 Months Ended | |||
Sep. 30, 2013 | ||||
Restricted stock | ' | |||
Stock-based compensation plans | ' | |||
Summary of activity under the 2007 Plan | ' | |||
Shares | ||||
Restricted stock at December 31, 2010 | 575,791 | |||
Granted in 2011 (vesting over 4 years) | 324,924 | |||
Granted in 2011 (vesting on first anniversary from date of issuance) | 22,100 | |||
Cancelled in 2011 | (27,477 | ) | ||
Vested in 2011 | (244,044 | ) | ||
Restricted stock at December 31, 2011 | 651,294 | |||
Granted in 2012 (vesting over 4 years) | 283,000 | |||
Granted in 2012 (vesting on first anniversary from date of issuance) | 28,040 | |||
Cancelled in 2012 | (8,988 | ) | ||
Vested in 2012 | (270,692 | ) | ||
Restricted stock at December 31, 2012 | 682,654 | |||
Granted in 2013 (vesting over 4 years) | 130,000 | |||
Granted in 2013 (vesting on first anniversary from date of issuance) | 21,408 | |||
Cancelled in 2013 | (28,198 | ) | ||
Vested in 2013 | (179,616 | ) | ||
Restricted Stock at September 30, 2013 | 626,248 | |||
Summary_of_Significant_Account3
Summary of Significant Accounting Policies (Details) | 9 Months Ended |
Sep. 30, 2013 | |
segment | |
Summary of Significant Accounting Policies | ' |
Number of reportable segments | 1 |
Summary_of_Significant_Account4
Summary of Significant Accounting Policies (Details 2) (Interest rate contracts, USD $) | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
Derivative instruments | ' | ' | ' |
Borrowings at variable rates | $343.50 | ' | $282 |
Revolving credit facility | ' | ' | ' |
Derivative instruments | ' | ' | ' |
Notional amount of outstanding derivative instruments | 100 | ' | 100 |
Cash Flow Hedging | ' | ' | ' |
Derivative instruments | ' | ' | ' |
Notional amount of outstanding derivative instruments | 100 | ' | ' |
Net fair value of swap liability | 0.3 | ' | 1.7 |
Interest expense | $1.10 | $6 | ' |
Summary_of_Significant_Account5
Summary of Significant Accounting Policies (Details 3) (USD $) | 9 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 |
Assets and (Liabilities) at Fair Value | ' | ' |
Liabilities under derivative instruments | ($301) | ($1,690) |
Ineffectiveness on hedges recorded in earnings | 0 | 0 |
Recurring | Total | ' | ' |
Assets and (Liabilities) at Fair Value | ' | ' |
Liabilities under derivative instruments | -301 | -1,690 |
Total | -301 | -1,690 |
Recurring | Level 2 | ' | ' |
Assets and (Liabilities) at Fair Value | ' | ' |
Liabilities under derivative instruments | -301 | -1,690 |
Total | ($301) | ($1,690) |
Summary_of_Significant_Account6
Summary of Significant Accounting Policies (Details 4) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Assets at fair value and gains (losses) recorded | ' | ' | ' | ' | ' |
Equipment held for sale | $31,506,000 | ' | $31,506,000 | ' | $23,607,000 |
Total losses on equipment held for sale | ' | ' | -6,268,000 | ' | -5,874,000 |
Total losses on assets | ' | ' | -6,268,000 | ' | -5,874,000 |
Asset write-down | 4,283,000 | 2,474,000 | 6,268,000 | 2,756,000 | ' |
Nonrecurring | ' | ' | ' | ' | ' |
Assets at fair value and gains (losses) recorded | ' | ' | ' | ' | ' |
Asset write-down recorded earlier | ' | ' | 3,500,000 | ' | 4,700,000 |
Asset write-down | ' | ' | 2,800,000 | ' | 1,200,000 |
Nonrecurring | Total | ' | ' | ' | ' | ' |
Assets at fair value and gains (losses) recorded | ' | ' | ' | ' | ' |
Equipment held for sale | 31,506,000 | ' | 31,506,000 | ' | 23,607,000 |
Assets at fair value | 31,506,000 | ' | 31,506,000 | ' | 23,607,000 |
Nonrecurring | Level 2 | ' | ' | ' | ' | ' |
Assets at fair value and gains (losses) recorded | ' | ' | ' | ' | ' |
Equipment held for sale | 29,839,000 | ' | 29,839,000 | ' | 23,384,000 |
Assets at fair value | 29,839,000 | ' | 29,839,000 | ' | 23,384,000 |
Nonrecurring | Level 3 | ' | ' | ' | ' | ' |
Assets at fair value and gains (losses) recorded | ' | ' | ' | ' | ' |
Equipment held for sale | 1,667,000 | ' | 1,667,000 | ' | 223,000 |
Assets at fair value | $1,667,000 | ' | $1,667,000 | ' | $223,000 |
Commitments_Contingencies_Guar1
Commitments, Contingencies, Guarantees and Indemnities (Details) (USD $) | Sep. 30, 2013 |
sqft | |
Office space | Novato, California | ' |
Commitments on rental lease | ' |
Area of office space (in square feet) | 20,534 |
Remaining lease commitment | $2,700,000 |
Office space | Shanghai, China | ' |
Commitments on rental lease | ' |
Remaining lease commitment | 16,200 |
Office space | London, United Kingdom | ' |
Commitments on rental lease | ' |
Remaining lease commitment | 200,000 |
Office space | Blagnac, France | ' |
Commitments on rental lease | ' |
Remaining lease commitment | 4,400 |
Office space | Dublin, Ireland | ' |
Commitments on rental lease | ' |
Remaining lease commitment | 200,000 |
Office and warehouse space | San Diego, California | ' |
Commitments on rental lease | ' |
Remaining lease commitment | 12,000 |
Warehouse lease | Shanghai, China | ' |
Commitments on rental lease | ' |
Remaining lease commitment | $27,300 |
Commitments_Contingencies_Guar2
Commitments, Contingencies, Guarantees and Indemnities (Details 2) (USD $) | 1 Months Ended | 9 Months Ended |
In Millions, unless otherwise specified | Oct. 31, 2006 | Sep. 30, 2013 |
item | item | |
Engines and related equipment | ' | ' |
Purchase commitments | ' | ' |
Number of items to be purchased | ' | 4 |
Purchase price | ' | 39.3 |
Non-refundable deposits paid | ' | 1.4 |
CFM56-7B and CFM56-5B spare engines | CFM | ' | ' |
Purchase commitments | ' | ' |
Maximum number of items to be purchased | 45 | ' |
Commitment period | '5 years | ' |
Option to purchase additional quantity | 30 | ' |
Number of engines for which purchase orders are outstanding | ' | 3 |
Investments_Details
Investments (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 0 Months Ended | 1 Months Ended | 9 Months Ended | 12 Months Ended | 33 Months Ended | 1 Months Ended | 6 Months Ended | 9 Months Ended | 1 Months Ended | 9 Months Ended | |||||||||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 18, 2013 | Sep. 30, 2013 | Sep. 18, 2013 | Jun. 30, 2011 | Sep. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2013 | 25-May-11 | Sep. 30, 2013 | Dec. 31, 2005 | Jun. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | 31-May-13 | 31-May-13 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | |
WOLF | Term notes | Term notes | WMES | WMES | WMES | WMES | WMES | WMES | WMES | WOLF | WOLF | WOLF | WOLF | WOLF | WOLF | WOLF | WOLF | WOLF | ||||||
item | WOLF | WOLF | item | item | item | JA Mitsui Leasing, Ltd | item | item | Term notes | Amended term notes | Amended term notes | Minimum | Maximum | |||||||||||
item | item | item | ||||||||||||||||||||||
Investments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Previously held interest (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | ' | ' | 50.00% | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' |
Initial capital contribution | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $8,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Additional capital contributions | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,100,000 | 5,600,000 | 1,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of engines transfer to joint venture | ' | ' | ' | ' | ' | ' | ' | ' | 7 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of engines purchased | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 16 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of engines in lease portfolio | ' | ' | ' | ' | ' | ' | ' | ' | ' | 23 | ' | ' | ' | ' | ' | ' | ' | 8 | ' | ' | ' | ' | ' | ' |
Capital contributions to date | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20,700,000 | ' | ' | 20,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proportionate gain on sale of engines to joint venture interest which is off-set against investments | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net investment after deducting partial offset | ' | ' | ' | ' | ' | ' | ' | ' | ' | 17,100,000 | ' | ' | 17,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gain on sale of engines | ' | ' | ' | ' | ' | ' | ' | ' | 7,200,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Credit facility established by equity method investee | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8,000,000 | ' | ' | 8,000,000 | ' | 180,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Reference rate, description | ' | ' | 'one-month LIBOR | ' | 'one-month LIBOR | ' | 'one-month LIBOR | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'one-month LIBOR | ' | ' | ' | 'one-month LIBOR | ' | ' |
Margin (as a percent) | ' | ' | ' | ' | ' | ' | 4.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4.00% | 1.00% | 2.50% |
Maturity term | ' | ' | ' | ' | ' | ' | ' | ' | ' | '7 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maintenance reserve revenue | 8,891,000 | 10,653,000 | 29,908,000 | 28,668,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,000,000 | ' | ' | ' | ' | ' | ' | ' |
Investment in joint venture | 18,072,000 | ' | 18,072,000 | ' | 21,831,000 | ' | ' | ' | ' | 18,072,000 | 11,766,000 | ' | 18,072,000 | ' | ' | ' | ' | ' | 10,065,000 | ' | ' | ' | ' | ' |
Number of Airbus A340-313 aircraft purchased | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase price of aircraft | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 96,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Number of term notes held | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | 4 | ' | ' | ' | ' | ' | ' | ' | ' |
Number of financial institutions associated with funding of term notes | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' |
Loan for purchase of aircraft | ' | ' | ' | ' | ' | ' | ' | 36,000,000 | ' | ' | ' | ' | ' | ' | ' | 76,800,000 | ' | ' | ' | ' | 36,000,000 | ' | ' | ' |
Number of term notes paid off | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' |
Number of term notes amended | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' |
Acquisition of the remaining outstanding shares (as a percent) | ' | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase price consideration | ' | ' | ' | ' | ' | 1,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Discount from JV partner's equity interest | ' | ' | ' | ' | ' | 12,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of aircraft engines acquired | ' | ' | ' | ' | ' | 8 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of aircraft airframes acquired | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of the net assets acquired | ' | ' | ' | ' | ' | 12,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of equipment acquired | ' | ' | ' | ' | ' | 27,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of cash and receivables acquired | ' | ' | ' | ' | ' | 1,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of debt and other liabilities | ' | ' | ' | ' | ' | $16,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Controlling interest assumed (as a percent) | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Investments_Details_2
Investments (Details 2) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Investments | ' | ' | ' | ' |
Investment in joint ventures at beginning of the period | ' | ' | $21,831 | ' |
Capital contribution | ' | ' | 6,145 | 3,830 |
Earnings (losses) from joint ventures | -289 | 352 | 3,186 | 948 |
Transfer to consolidated subsidiary | ' | ' | -13,090 | ' |
Investment in joint ventures at end of the period | 18,072 | ' | 18,072 | ' |
WOLF | ' | ' | ' | ' |
Investments | ' | ' | ' | ' |
Investment in joint ventures at beginning of the period | ' | ' | 10,065 | ' |
Earnings (losses) from joint ventures | ' | ' | 3,025 | ' |
Transfer to consolidated subsidiary | ' | ' | -13,090 | ' |
WMES | ' | ' | ' | ' |
Investments | ' | ' | ' | ' |
Investment in joint ventures at beginning of the period | ' | ' | 11,766 | ' |
Capital contribution | ' | ' | 6,145 | ' |
Earnings (losses) from joint ventures | ' | ' | 161 | ' |
Investment in joint ventures at end of the period | $18,072 | ' | $18,072 | ' |
Long_Term_Debt_Details
Long Term Debt (Details) (USD $) | 6 Months Ended | 9 Months Ended | 12 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 0 Months Ended | 9 Months Ended | 9 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 0 Months Ended | |||||||||||||||||
Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 18, 2013 | Sep. 17, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 17, 2012 | Sep. 28, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2011 | Sep. 30, 2013 | Dec. 31, 2012 | Jan. 11, 2010 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Nov. 18, 2011 | Sep. 30, 2013 | Jun. 18, 2013 | Dec. 31, 2012 | Sep. 17, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 18, 2013 | |
WOLF | WEST II Series 2012-A term notes payable at a fixed rate of interest maturing in September 2037. Secured by engines | WEST II Series 2012-A term notes payable at a fixed rate of interest maturing in September 2037. Secured by engines | WEST II Series 2012-A term notes payable at a fixed rate of interest maturing in September 2037. Secured by engines | WEST II Series 2012-A term notes payable at a fixed rate of interest maturing in September 2037. Secured by engines | Prior WEST notes | Note payable at a fixed interest rate of 5.50%, maturing in September 2017. Secured by one engine. | Note payable at a fixed interest rate of 5.50%, maturing in September 2017. Secured by one engine. | Note payable at a fixed interest rate of 5.50%, maturing in September 2017. Secured by one engine. | Note payable at a fixed interest rate of 3.94%, maturing in September 2014. Secured by an aircraft | Note payable at a fixed interest rate of 3.94%, maturing in September 2014. Secured by an aircraft | Note payable at a fixed interest rate of 3.94%, maturing in September 2014. Secured by an aircraft | Note payable at a fixed interest rate of 4.50%, maturing in January 2014. Secured by engines. | Note payable at a fixed interest rate of 4.50%, maturing in January 2014. Secured by engines. | Note payable at a fixed interest rate of 4.50%, maturing in January 2014. Secured by engines. | Notes payable | Notes payable | Notes payable | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Term notes | Term notes | |||||
WEST II | WEST II | WEST II | WEST II | item | item | Minimum | Maximum | WEST | Credit agreement | Credit agreement | Credit agreement | WOLF | WOLF | |||||||||||||||||||
item | Minimum | item | Minimum | Maximum | item | |||||||||||||||||||||||||||
Long Term Debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Notes payable | ' | $744,300,000 | ' | $696,988,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $744,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maturity term | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | '5 years | ' | ' | '3 years | ' | ' | '4 years | ' | ' | ' | '4 months | '9 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate, minimum (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.20% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate, maximum (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowing capacity under credit facility | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 450,000,000 | 450,000,000 | ' | ' | ' | ' | ' | ' | ' |
Remaining borrowing capacity available | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 138,000,000 | ' | 148,000,000 | ' | ' | ' | ' | ' | ' |
Debt issuance costs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowing capacity under credit facility before amendment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 430,000,000 | ' | ' | ' | ' | ' | ' | ' |
Debt to equity ratio | 3.8 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Variable rate of debt | ' | 'one-month LIBOR | ' | 'one-month LIBOR | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'LIBOR | ' | ' | ' | ' | ' | ' | 'one-month LIBOR | ' |
Basis spread on variable rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.00% | ' | ' | ' | ' | ' | ' | 4.00% | ' |
Net proceeds received from notes issued and sold | ' | 72,000,000 | 537,693,000 | ' | ' | 384,900,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total notes payable before discount | ' | 744,300,000 | ' | ' | ' | ' | 375,000,000 | 386,700,000 | ' | 435,900,000 | ' | 8,300,000 | 8,600,000 | ' | 1,300,000 | 2,300,000 | ' | 16,200,000 | 17,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 31,500,000 | ' |
Number of engines pledged as collateral | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | 22 | ' | ' | ' | ' | ' |
Number of engines in portfolio offered as collateral | ' | ' | ' | ' | ' | ' | 79 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fixed amortization of notes payable | ' | ' | ' | ' | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of business days to pay interest | ' | ' | ' | ' | ' | ' | '5 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fixed rate (as a percent) | ' | ' | ' | ' | ' | ' | 5.50% | ' | ' | ' | ' | 5.50% | ' | ' | 3.94% | ' | ' | 4.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period of time over which maintenance obligations are projected | ' | ' | ' | ' | ' | ' | '6 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Minimum amount of cash from maintenance reserve payments required to be held in restricted cash account | ' | ' | ' | ' | ' | ' | ' | ' | 9,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Face amount | ' | ' | ' | ' | ' | 390,000,000 | ' | ' | ' | ' | 8,700,000 | ' | ' | 4,000,000 | ' | ' | 22,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 36,000,000 |
Interest coverage ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.5 | ' | ' | ' |
Leverage ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4.75 | ' | ' |
Minimum consolidated tangible net worth | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 191,100,000 | ' | ' | ' | ' |
One-month LIBOR rate (as a percent) | ' | 0.18% | 0.21% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisition of remaining outstanding shares of previously held equity method investment (as a percent) | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of term notes held | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 |
Aggregate maturities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2013 | ' | 11,186,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2014 | ' | 42,023,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2015 | ' | 32,934,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2016 (includes $312.0 million outstanding on revolving credit facility) | ' | 338,215,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2017 | ' | 32,873,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Thereafter | ' | 287,069,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Notes payable | ' | 744,300,000 | ' | ' | ' | ' | 375,000,000 | 386,700,000 | ' | 435,900,000 | ' | 8,300,000 | 8,600,000 | ' | 1,300,000 | 2,300,000 | ' | 16,200,000 | 17,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 31,500,000 | ' |
Line of credit facility outstanding amount | ' | $312,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative_Instruments_Details
Derivative Instruments (Details) (USD $) | 9 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 |
Derivative instruments | ' | ' |
Variable rate of debt | 'one-month LIBOR | 'one-month LIBOR |
Revolving credit facility | ' | ' |
Derivative instruments | ' | ' |
Variable rate of debt | 'LIBOR | ' |
Interest rate contracts | ' | ' |
Derivative instruments | ' | ' |
Borrowings at variable interest rates | 343.5 | 282 |
Estimated increase in net finance costs | 0.3 | ' |
Interest rate contracts | Cash Flow Hedging | ' | ' |
Derivative instruments | ' | ' |
Notional amount outstanding | 100 | ' |
Net fair value of swap liability | 0.3 | 1.7 |
Interest rate contracts | Revolving credit facility | ' | ' |
Derivative instruments | ' | ' |
Number of interest rate swaps held | 1 | 1 |
Notional amount outstanding | 100 | 100 |
Remaining maturity term | '2 months | ' |
Fixed interest rate (as a percent) | 2.10% | 2.10% |
Derivative_Instruments_Details1
Derivative Instruments (Details 2) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Fair values of derivative instruments | ' | ' |
Liabilities under derivative instruments | $301 | $1,690 |
Designated as Hedging Instruments | Interest rate contracts | ' | ' |
Fair values of derivative instruments | ' | ' |
Liabilities under derivative instruments | $301 | $1,690 |
Derivative_Instruments_Details2
Derivative Instruments (Details 3) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Effects of derivative instruments | ' | ' | ' | ' |
Reclassification adjustment for losses included in termination of derivative instruments and recognized on derivatives in the statements of income | ' | ' | ' | ($6,410) |
Cash Flow Hedging | Designated as Hedging Instruments | ' | ' | ' | ' |
Effects of derivative instruments | ' | ' | ' | ' |
Amount of Loss Recognized on Derivatives in the Statements of Income | 390 | 11,953 | 1,149 | 16,169 |
Cash Flow Hedging | Loss on debt extinguishment and derivative termination | Designated as Hedging Instruments | ' | ' | ' | ' |
Effects of derivative instruments | ' | ' | ' | ' |
Reclassification adjustment for losses included in termination of derivative instruments and recognized on derivatives in the statements of income | ' | 10,143 | ' | 10,143 |
Cash Flow Hedging | Interest rate contracts | Interest expense | Designated as Hedging Instruments | ' | ' | ' | ' |
Effects of derivative instruments | ' | ' | ' | ' |
Amount of Loss Recognized on Derivatives in the Statements of Income | $390 | $1,810 | $1,149 | $6,026 |
Derivative_Instruments_Details3
Derivative Instruments (Details 4) (Cash Flow Hedging, USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Effects of derivative instruments | ' | ' | ' | ' |
Amount of Gain (Loss) Recognized in OCI on Derivatives (Effective Portion) | ($480,000) | ($1,191,000) | ($1,389,000) | $83,000 |
Amount of Loss Reclassified from Accumulated OCI into Income (Effective Portion) | -390,000 | -1,810,000 | -1,149,000 | -6,026,000 |
Significant ineffectiveness on hedges | 0 | 0 | 0 | 0 |
Interest expense | ' | ' | ' | ' |
Effects of derivative instruments | ' | ' | ' | ' |
Amount of Loss Reclassified from Accumulated OCI into Income (Effective Portion) | -390,000 | -1,810,000 | -1,149,000 | -6,026,000 |
Interest rate contracts | ' | ' | ' | ' |
Effects of derivative instruments | ' | ' | ' | ' |
Amount of Gain (Loss) Recognized in OCI on Derivatives (Effective Portion) | -480,000 | -1,191,000 | -1,389,000 | 83,000 |
Amounts of other comprehensive income reclassified to the income statement | $500,000 | $1,900,000 | $1,400,000 | $6,200,000 |
StockBased_Compensation_Plans_1
Stock-Based Compensation Plans (Details) (USD $) | 24-May-07 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2013 | Sep. 30, 2012 |
In Millions, except Share data, unless otherwise specified | The 2007 plan | The 2007 plan | The 2007 plan | The 2007 plan | The 2007 plan | The 2007 plan | The 2007 plan | The 2007 plan | The 2007 plan | The 2007 plan | The 2007 plan | 1996 Plan | 1996 Plan |
Restricted stock | Restricted stock | Restricted stock | Restricted stock | Restricted stock vesting over 4 years | Restricted stock vesting over 4 years | Restricted stock vesting over 4 years | Restricted stock vesting on the first anniversary date from date of issuance | Restricted stock vesting on the first anniversary date from date of issuance | Restricted stock vesting on the first anniversary date from date of issuance | ||||
Stock-based compensation plans | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares authorized | 2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares awarded, net of cancellations | ' | 1,781,858 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number Outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the beginning of the period (in shares) | ' | 682,654 | 651,294 | 651,294 | 575,791 | ' | ' | ' | ' | ' | ' | ' | ' |
Shares granted | ' | ' | ' | ' | ' | 130,000 | 283,000 | 324,924 | 21,408 | 28,040 | 22,100 | ' | ' |
Shares cancelled | ' | -28,198 | ' | -8,988 | -27,477 | ' | ' | ' | ' | ' | ' | ' | ' |
Shares vested | ' | -179,616 | ' | -270,692 | -244,044 | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the end of the period (in shares) | ' | 626,248 | ' | 682,654 | 651,294 | ' | ' | ' | ' | ' | ' | ' | ' |
Stock compensation expense (in dollars) | ' | $2.50 | $2.30 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Remaining average vesting period for recognition of unrecognized compensation expense | ' | '2 years 3 months | '2 years 3 months 18 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unrecognized compensation expense (in dollars) | ' | 6.7 | 6.5 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intrinsic value of unvested awards (in dollars) | ' | 9.9 | 7.8 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock options exercised (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 44,991 | 232,314 |
Options canceled (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,500 | ' |
Stock options outstanding (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 85,437 | 211,267 |
Intrinsic value of outstanding stock options (in dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.50 | $0.90 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Income Taxes | ' | ' | ' | ' | ' |
Income tax expense (benefit) | ($1,383,000) | ' | ($3,486,000) | ($8,181,000) | $405,000 |
Effective tax rate (as a percent) | ' | ' | ' | 43.60% | 149.40% |
Income tax benefit related to extraterritorial income | ' | 8,600,000 | ' | ' | ' |
Tax benefit due to debt extinguishment and derivative termination | ' | ' | ' | ' | $5,300,000 |
Related_Party_and_Similar_Tran1
Related Party and Similar Transactions (Details) (J.T. Power, USD $) | 12 Months Ended | 0 Months Ended | 9 Months Ended | 12 Months Ended | 1 Months Ended | 9 Months Ended | 0 Months Ended | ||||||||
Dec. 31, 2008 | Sep. 30, 2013 | Mar. 07, 2012 | Feb. 22, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2008 | Jul. 31, 2009 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Feb. 22, 2012 | Nov. 06, 2013 | Nov. 06, 2013 | |
item | Consignment agreement with guarantee | Consignment agreement with guarantee | Consignment agreement with guarantee | Consignment agreement with guarantee | Consignment agreement with guarantee | Consignment agreement without guarantee | Consignment agreement without guarantee | Consignment agreement without guarantee | Aircraft Engine Agency Agreement | Aircraft Engine Agency Agreement | Minimum | Subsequent event | Subsequent event | ||
item | item | item | Consignment agreement with guarantee | Asset Purchase Agreement | Consignment agreement with guarantee | ||||||||||
Asset Purchase Agreement | |||||||||||||||
Related Party and Similar Transactions | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of consignment agreements with related party | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Book value of engines consigned for sale upon teardown of engine parts | ' | ' | ' | ' | ' | ' | $5,200,000 | $23,000 | ' | ' | ' | ' | ' | ' | ' |
Sales of consigned parts by related party | ' | ' | ' | ' | 19,900 | 14,700 | ' | ' | 1,700 | 54,200 | ' | ' | ' | ' | ' |
Net consignment proceeds from related party | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,000,000 | ' | ' |
Consignment proceeds obligation from related party | ' | ' | ' | 1,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Required quarterly consignment payments by related party | ' | ' | 45,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Payment term of consignment proceeds by related party | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate on payment of consignment proceeds by related party (as a percent) | ' | ' | 6.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of quarterly consignment payments which can be skipped by related party | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate for skipped payment (as a percent) | ' | ' | 12.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal amount owing under the note | ' | 1,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of engines consigned for sale upon teardown of engine parts | ' | ' | ' | ' | ' | ' | 4 | 1 | ' | ' | ' | ' | ' | ' | ' |
Lease rent revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 | ' | ' | ' |
Value of certain assets purchased | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,900,000 | ' |
Net cash payment for certain asset purchases | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,500,000 | ' |
Amount owed to the entity related to the minimum guarantee, which is deducted from payment made in cash | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,100,000 |
Cash payment to creditors for certain asset purchases | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,200,000 | ' |
Cash payment to shareholders for certain asset purchases | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $3,300,000 | ' |
Fair_Value_of_Financial_Instru1
Fair Value of Financial Instruments (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Fair value of financial instruments | ' | ' |
Carrying value on outstanding balance of notes payable | $744,300,000 | $696,988,000 |
Level 3 | ' | ' |
Fair value of financial instruments | ' | ' |
Fair value of notes payable | $761,000,000 | $697,300,000 |
Subsequent_Event_Details
Subsequent Event (Details) (Subsequent event, Asset Purchase Agreement, J.T. Power, USD $) | 0 Months Ended |
In Millions, unless otherwise specified | Nov. 06, 2013 |
Subsequent events | ' |
Value of certain assets purchased | $5.90 |
Net cash payment for certain asset purchases | 4.5 |
Cash payment to creditors for certain asset purchases | 1.2 |
Cash payment to shareholders for certain asset purchases | 3.3 |
Consignment agreement with guarantee | ' |
Subsequent events | ' |
Amount owed to the entity related to the minimum guarantee, which is deducted from payment made in cash | $1.10 |