Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2014 | 1-May-14 | |
Document and Entity Information | ' | ' |
Entity Registrant Name | 'WILLIS LEASE FINANCE CORP | ' |
Entity Central Index Key | '0001018164 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Mar-14 | ' |
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 | ' | 8,431,708 |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
ASSETS | ' | ' |
Cash and cash equivalents | $15,631 | $12,801 |
Restricted cash | 53,375 | 50,794 |
Equipment held for operating lease, less accumulated depreciation of $267,347 and $257,806 at March 31, 2014 and December 31, 2013, respectively | 1,022,462 | 1,033,022 |
Equipment held for sale | 30,376 | 32,491 |
Operating lease related receivable, net of allowances of $298 and $296 at March 31, 2014 and December 31, 2013, respectively | 13,650 | 13,286 |
Inventory | 3,257 | 3,280 |
Investments | 23,790 | 23,485 |
Property, equipment & furnishings, less accumulated depreciation of $8,786 and $8,666 at March 31, 2014 and December 31, 2013, respectively | 4,920 | 4,950 |
Intangible assets, net | 1,338 | 1,396 |
Equipment purchase deposits | 1,969 | 1,369 |
Other assets | 21,849 | 22,355 |
Total assets | 1,192,617 | 1,199,229 |
Liabilities: | ' | ' |
Accounts payable and accrued expenses | 18,917 | 16,283 |
Deferred income taxes | 88,924 | 86,685 |
Notes payable | 767,108 | 787,614 |
Maintenance reserves | 79,751 | 77,335 |
Security deposits | 16,318 | 15,158 |
Unearned lease revenue | 4,042 | 3,549 |
Total liabilities | 975,060 | 986,624 |
Shareholders' equity: | ' | ' |
Common stock ($0.01 par value, 20,000,000 shares authorized; 8,447,438 and 8,399,739 shares issued and outstanding at March 31, 2014 and December 31, 2013, respectively) | 84 | 84 |
Paid-in capital in excess of par | 45,441 | 44,741 |
Retained earnings | 171,786 | 167,455 |
Accumulated other comprehensive income, net of income tax expense of $46 and $174 at March 31, 2014 and December 31, 2013, respectively | 246 | 325 |
Total shareholders' equity | 217,557 | 212,605 |
Total liabilities and shareholders' equity | $1,192,617 | $1,199,229 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Consolidated Balance Sheets | ' | ' |
Equipment held for operating lease, accumulated depreciation (in dollars) | $267,347 | $257,806 |
Operating lease related receivable, allowances (in dollars) | 298 | 296 |
Property, equipment & furnishings, accumulated depreciation (in dollars) | 8,786 | 8,666 |
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 | 8,447,438 | 8,399,739 |
Common stock, shares outstanding | 8,447,438 | 8,399,739 |
Accumulated other comprehensive loss, income tax expense (benefit) (in dollars) | $46 | $174 |
Consolidated_Statements_of_Inc
Consolidated Statements of Income (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
REVENUE | ' | ' |
Lease rent revenue | $26,900 | $24,487 |
Maintenance reserve revenue | 14,030 | 9,229 |
Gain on sale of leased equipment | 309 | 686 |
Other revenue | 1,761 | 902 |
Total revenue | 43,000 | 35,304 |
EXPENSES | ' | ' |
Depreciation and amortization expense | 15,710 | 13,610 |
Write-down of equipment | 295 | ' |
General and administrative | 9,685 | 8,269 |
Technical expense | 1,520 | 1,674 |
Net finance costs | 9,359 | 9,227 |
Total expenses | 36,569 | 32,780 |
Earnings from operations | 6,431 | 2,524 |
Earnings from joint ventures | 305 | 93 |
Income before income taxes | 6,736 | 2,617 |
Income tax expense | -2,405 | -1,007 |
Net income | $4,331 | $1,610 |
Basic earnings per common share: (in dollars per share) | $0.55 | $0.20 |
Diluted earnings per common share: (in dollars per share) | $0.53 | $0.19 |
Average common shares outstanding (in shares) | 7,914 | 8,033 |
Diluted average common shares outstanding (in shares) | 8,129 | 8,273 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Consolidated Statements of Comprehensive Income | ' | ' |
Net income | $4,331 | $1,610 |
Derivative instruments | ' | ' |
Unrealized gain on derivative instruments | ' | 9 |
Reclassification adjustment for (gains) losses included in net income | -125 | 366 |
Net gain (loss) recognized in other comprehensive income (loss) | -125 | 375 |
Tax benefit (expense) related to items of other comprehensive income | 46 | -137 |
Other comprehensive income (loss) | -79 | 238 |
Total comprehensive income | $4,252 | $1,848 |
Consolidated_Statements_of_Sha
Consolidated Statements of Shareholders' Equity (USD $) | Total | 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, 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 | 1,610 | ' | ' | ' | 1,610 |
Unrealized gain (loss) from derivative instruments, net of tax expense of $46 and $137 for the three months ended March 31, 2014 and March 31, 2013, respectively | 238 | ' | ' | 238 | ' |
Shares repurchased | -358 | ' | -358 | ' | ' |
Shares repurchased (in shares) | ' | -25 | ' | ' | ' |
Shares issued under stock compensation plans | 230 | ' | 230 | ' | ' |
Shares issued under stock compensation plans (in shares) | ' | 20 | ' | ' | ' |
Cancellation of restricted stock units in satisfaction of withholding tax | -263 | ' | -263 | ' | ' |
Cancellation of restricted stock units in satisfaction of withholding tax (in shares) | ' | -18 | ' | ' | ' |
Stock-based compensation, net of forfeitures | 783 | ' | 783 | ' | ' |
Balances at Mar. 31, 2013 | 201,793 | 87 | 48,177 | -992 | 154,521 |
Balances (in shares) at Mar. 31, 2013 | ' | 8,693 | ' | ' | ' |
Balances at Dec. 31, 2013 | 212,605 | 84 | 44,741 | 325 | 167,455 |
Balances (in shares) at Dec. 31, 2013 | ' | 8,400 | ' | ' | ' |
Increase (Decrease) in Shareholders' Equity | ' | ' | ' | ' | ' |
Net income | 4,331 | ' | ' | ' | 4,331 |
Unrealized gain (loss) from derivative instruments, net of tax expense of $46 and $137 for the three months ended March 31, 2014 and March 31, 2013, respectively | -79 | ' | ' | -79 | ' |
Shares issued under stock compensation plans | 212 | 1 | 211 | ' | ' |
Shares issued under stock compensation plans (in shares) | ' | 63 | ' | ' | ' |
Cancellation of restricted stock units in satisfaction of withholding tax | -270 | -1 | -269 | ' | ' |
Cancellation of restricted stock units in satisfaction of withholding tax (in shares) | ' | -16 | ' | ' | ' |
Stock-based compensation, net of forfeitures | 758 | ' | 758 | ' | ' |
Balances at Mar. 31, 2014 | $217,557 | $84 | $45,441 | $246 | $171,786 |
Balances (in shares) at Mar. 31, 2014 | ' | 8,447 | ' | ' | ' |
Consolidated_Statements_of_Sha1
Consolidated Statements of Shareholders' Equity (Parenthetical) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Consolidated Statements of Shareholders' Equity | ' | ' |
Unrealized gain (loss) from derivative instruments, tax expense | ($46) | $137 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Cash flows from operating activities: | ' | ' |
Net income | $4,331 | $1,610 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation and amortization expense | 15,710 | 13,610 |
Write-down of equipment | 295 | ' |
Stock-based compensation expenses | 758 | 783 |
Amortization of deferred costs | 1,036 | 1,049 |
Amortization of interest rate derivative cost | -125 | -96 |
Allowances and provisions | 2 | -52 |
Gain on sale of leased equipment | -309 | -686 |
Income from joint ventures, net of distributions | -305 | -93 |
Deferred income taxes | 2,405 | 1,007 |
Changes in assets and liabilities: | ' | ' |
Receivables | -366 | 3,041 |
Other assets | -501 | 6 |
Inventory | -350 | ' |
Accounts payable and accrued expenses | 1,734 | 144 |
Restricted cash | -8,068 | -5,695 |
Maintenance reserves | 2,416 | 3,679 |
Security deposits | -357 | -186 |
Unearned lease revenue | 493 | 430 |
Net cash provided by operating activities | 18,799 | 18,551 |
Cash flows from investing activities: | ' | ' |
Proceeds from sale of equipment (net of selling expenses) | 5,688 | 3,166 |
Restricted cash for investing activities | 5,487 | -2,207 |
Capital contribution to joint ventures | ' | -6,146 |
Purchase of equipment held for operating lease and for sale | -7,915 | -79,576 |
Purchase of property, equipment and furnishings | -156 | -31 |
Net cash provided by (used in) investing activities | 3,104 | -84,794 |
Cash flows from financing activities: | ' | ' |
Proceeds from issuance of notes payable | 5,000 | 69,000 |
Debt issuance cost | -27 | -570 |
Interest bearing security deposits | 1,518 | 3,035 |
Proceeds from shares issued under stock compensation plans | 212 | 230 |
Cancellation of restricted stock units in satisfaction of withholding tax | -270 | -263 |
Repurchase of common stock | ' | -358 |
Principal payments on notes payable | -25,506 | -8,853 |
Net cash (used in) provided by financing activities | -19,073 | 62,221 |
Increase/(Decrease) in cash and cash equivalents | 2,830 | -4,022 |
Cash and cash equivalents at beginning of period | 12,801 | 5,379 |
Cash and cash equivalents at end of period | 15,631 | 1,357 |
Net cash paid for: | ' | ' |
Interest | 8,811 | 8,140 |
Income Taxes | 55 | ' |
Supplemental disclosures of non-cash investing activities: | ' | ' |
Purchase of aircraft and engines, liability incurred but not paid | 802 | 767 |
Engines and equipment, transferred from Held for Operating Lease to Held for Sale but not settled | $10,924 | $2,141 |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 3 Months Ended | |||||||||||||||||||||||||||||||
Mar. 31, 2014 | ||||||||||||||||||||||||||||||||
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 for the fiscal year ended December 31, 2013. | ||||||||||||||||||||||||||||||||
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 March 31, 2014 and December 31, 2013, and the results of our operations for the three months ended March 31, 2014 and 2013, and our cash flows for the three months ended March 31, 2014 and 2013. The results of operations and cash flows for the period ended March 31, 2014 are not necessarily indicative of the results of operations or cash flows which may be reported for the remainder of 2014. | ||||||||||||||||||||||||||||||||
(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 | ||||||||||||||||||||||||||||||||
As of March 31, 2014 and December 31, 2013, we held no interest rate swaps. As of March 31, 2013, we measured 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 March 31, 2013 used creditworthiness inputs that corroborate observable market data evaluating the Company’s and counterparties’ risk of non-performance. The interest rate swap agreements as of March 31, 2013 had a net liability fair value of $1.2 million. For the three months ended March 31, 2014 and March 31, 2013, ($0.1 million) and $0.4 million, respectively, were realized as net finance costs on the Consolidated Statements of Income. | ||||||||||||||||||||||||||||||||
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. an offer to purchase) 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 March 31, 2014 and 2013, and the gains (losses) recorded during the three months ended March 31, 2014 and 2013 on those assets: | ||||||||||||||||||||||||||||||||
Assets at Fair Value | Total Losses | |||||||||||||||||||||||||||||||
March 31, 2014 | March 31, 2013 | Three Months Ended March | ||||||||||||||||||||||||||||||
31, | ||||||||||||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | 2014 | 2013 | |||||||||||||||||||||||
(in thousands) | (in thousands) | |||||||||||||||||||||||||||||||
Inventory | $ | 3,257 | $ | — | $ | — | $ | 3,257 | $ | — | $ | — | $ | — | $ | — | $ | (295 | ) | $ | — | |||||||||||
Equipment held for sale | 30,376 | — | 19,844 | 10,532 | 23,996 | — | 23,966 | 30 | — | — | ||||||||||||||||||||||
Total | $ | 33,633 | $ | — | $ | 19,844 | $ | 13,789 | $ | 23,996 | $ | — | $ | 23,966 | $ | 30 | $ | (295 | ) | $ | — | |||||||||||
At March 31, 2014, 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 assets that were held as inventory not consigned to third parties. The fair values of the assets categorized as Level 3 were based on management’s estimate considering projected future sales proceeds at March 31, 2014 and March 31, 2013. An impairment charge is recorded when the carrying value of the asset exceeds its fair value. An asset write-down of $0.3 million was recorded in the three months ended March 31, 2014 based upon a comparison of the asset net book value with the net proceeds expected from part sales arising from part-out of an engine. No asset write-down was recorded in the three months ended March 31, 2013. |
Management_Estimates
Management Estimates | 3 Months Ended |
Mar. 31, 2014 | |
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 | 3 Months Ended |
Mar. 31, 2014 | |
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 $2.4 million. Equipment leasing, financing, sales and general administrative activities are conducted from the Novato location. We sub-lease office and warehouse space for our operations in San Diego, California. This lease expires October 31, 2014, and the remaining lease commitment is approximately $88,000. We lease office and warehouse space in Shanghai, China. The office lease expires December 31, 2014 and the warehouse lease expires July 31, 2017 and the remaining lease commitments are approximately $49,000 and $24,000, respectively. We lease office space in London, United Kingdom. The lease expires December 21, 2015 and the remaining lease commitment is approximately $131,000. We lease office space in Blagnac, France. The lease expires December 31, 2014 and the remaining lease commitment is approximately $15,000. We lease office space in Dublin, Ireland. The lease expires May 15, 2017 and the remaining lease commitment is approximately $37,000. We lease office and warehouse space in Boynton Beach, Florida. The lease expires October 29, 2019 and the remaining lease commitment is approximately $1.3 million. | |
We have made purchase commitments to secure the purchase of three engines and one aircraft and related equipment for a gross purchase price of $36.2 million, for delivery in 2014. As of March 31, 2014, non-refundable deposits paid related to these purchase commitments were $2.0 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 order with CFM for one engine represents deferral of engine deliveries originally scheduled for 2009 and are included in our commitments to purchase in 2014. |
Investments
Investments | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
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 $11.2 million capital contributions to WMES in the years ended December 31, 2011, 2012 and 2013, respectively, for the purchase of 17 engines from third parties, increasing the number of engines in the lease portfolio to 26. The Company made no capital contributions to WMES in the three months ended March 31, 2014. The $25.8 million of capital contributions has been partially offset by $3.6 million, resulting in a net investment of $22.2 million, which has increased to $23.8 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 has also established separate credit facilities totaling $62.0 million to fund the purchase of engines. Our investment in the joint venture is $23.8 million and $23.5 million as of March 31, 2014 and December 31, 2013, respectively. | |||||
Three Months Ended March 31, 2014 | (in thousands) | ||||
Investment in WMES joint venture as of December 31, 2013 | $ | 23,485 | |||
Capital contribution | — | ||||
Earnings from joint venture | 305 | ||||
Distribution | — | ||||
Investment in WMES joint venture as of March 31, 2014 | $ | 23,790 |
Long_Term_Debt
Long Term Debt | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
Long Term Debt. | ' | ||||
Long Term Debt | ' | ||||
5. Long Term Debt | |||||
At March 31, 2014, notes payable consists of loans totaling $767.1 million, payable over periods of approximately 6 months to 8 years with interest rates varying between approximately 2.4% and 5.5%. | |||||
At March 31, 2014, 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 March 31, 2014 and December 31, 2013, $101.0 million and $88.0 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 3.87, as calculated under the terms of the revolving credit facility at December 31 2013, the interest rate on this facility is LIBOR plus 3.00% as of March 31, 2014. 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. The current portfolio of 71 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 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 March 31, 2014 and December 31, 2013, $366.1 million and $370.6 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. As a result of the transaction, we now own one hundred percent of WOLF and it is consolidated for financial statement presentation purposes. The WOLF assets and liabilities and the results of operations have been included in the accompanying consolidated financial statements as of the acquisition date, September 18, 2013. Two term notes with an original principal amount of $36.0 million, with a current balance outstanding of $27.8 million as of March 31, 2014, are included in Notes payable. The two term notes are non-recourse to the Company, have a maturity date of May 28, 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 sales 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 January 10, 2014, we extended the term of an existing loan that was scheduled to mature on January 11, 2014. The loan has a term of 4 years with a maturity date of January 11, 2018. Interest is payable at one-month LIBOR plus 2.25% and principal and interest is paid quarterly. The loan is secured by three engines. The balance outstanding on this loan is $15.5 million and $15.8 million as of March 31, 2014 and December 31, 2013, respectively. | |||||
On September 28, 2012, we closed on a loan for a five year term totaling $8.7 million. Interest is payable at a fixed rate of 5.50% and principal and interest 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 $8.1 million and $8.2 million as of March 31, 2014 and December 31, 2013, 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 $0.7 million and $1.0 million as of March 31, 2014 and December 31, 2013, respectively. | |||||
At March 31, 2014 and 2013, one-month LIBOR was 0.15% and 0.20%, respectively. | |||||
The following is a summary of the aggregate maturities of notes payable at March 31, 2014: | |||||
Year | (in thousands) | ||||
2014 | $ | 20,062 | |||
2015 | 34,307 | ||||
2016 (includes $349.0 million outstanding on revolving credit facility) | 376,589 | ||||
2017 | 38,746 | ||||
2018 | 33,804 | ||||
Thereafter | 263,600 | ||||
$ | 767,108 |
Derivative_Instruments
Derivative Instruments | 3 Months Ended | |||||||||||||||
Mar. 31, 2014 | ||||||||||||||||
Derivative Instruments | ' | |||||||||||||||
Derivative Instruments | ' | |||||||||||||||
6. Derivative Instruments | ||||||||||||||||
We periodically hold interest rate derivative instruments to mitigate exposure to changes in interest rates, in particular one-month LIBOR, with $392.3 million and $392.0 million of our borrowings at March 31, 2014 and December 31, 2013, respectively, at variable rates. As a matter of policy, we do not use derivatives for speculative purposes. We currently have no interest rate swap agreements in place. During 2013 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%. The swap agreement expired in November 2013. The remaining effective portion of these hedges at the swap expiration date is being amortized into earnings over the term of the underlying borrowings. We recorded a $0.1 million benefit to net finance costs during each of the three month periods ended March 31, 2014 and March 31, 2013. | ||||||||||||||||
The Company estimates the fair value of derivative instruments using a discounted cash flow technique and uses 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. 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. | ||||||||||||||||
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 months ended March 31, 2014 and 2013: | ||||||||||||||||
Amount of (Gain) Loss Recognized | ||||||||||||||||
on Derivatives in the | ||||||||||||||||
Statements of Income | ||||||||||||||||
Derivatives in Cash Flow | Location of (Gain) Loss Recognized on | Three Months Ended | ||||||||||||||
March 31, | ||||||||||||||||
Hedging Relationships | Derivatives in the Statements of Income | 2014 | 2013 | |||||||||||||
(in thousands) | ||||||||||||||||
Interest rate contracts | Interest expense | $ | (125 | ) | $ | 366 | ||||||||||
Total | $ | (125 | ) | $ | 366 | |||||||||||
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 months ended March 31, 2014 and 2013: | ||||||||||||||||
Amount of Gain Recognized in OCI on | Location of Gain (Loss) | Amount of Gain (Loss) Reclassified | ||||||||||||||
Derivatives | from Accumulated OCI into | |||||||||||||||
(Effective Portion) | Income | |||||||||||||||
(Effective Portion) | ||||||||||||||||
Derivatives in Cash Flow | Three Months Ended | Reclassified from Accumulated | Three Months Ended | |||||||||||||
March 31, | OCI into Income | March 31, | ||||||||||||||
Hedging Relationships | 2014 | 2013 | (Effective Portion) | 2014 | 2013 | |||||||||||
(in thousands) | (in thousands) | |||||||||||||||
Interest rate contracts* | $ | — | $ | 472 | Interest expense | $ | 125 | $ | (366 | ) | ||||||
Total | $ | — | $ | 472 | Total | $ | 125 | $ | (366 | ) | ||||||
* These amounts are shown net of $0 and $0.5 million of of interest payments reclassified to the income statement during the three months ended March 31, 2014 and 2013, 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 during the first eleven months of 2013 was a large financial institution in the United States that possessed an investment grade credit rating. Based on this rating, the Company believes that the counterparty was creditworthy and that their continuing performance under the hedging agreement was probable, and had not required the counterparty to provide collateral or other security to the Company. |
StockBased_Compensation_Plans
Stock-Based Compensation Plans | 3 Months Ended | |||
Mar. 31, 2014 | ||||
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 1,784,946 shares of restricted stock awarded to date. 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, 2012, December 31, 2013 and the three months ended March 31, 2014: | ||||
Shares | ||||
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 | (60,110 | ) | ||
Vested in 2013 | (258,822 | ) | ||
Restricted stock at December 31, 2013 | 515,130 | |||
Granted in 2014 (vesting on first anniversary from date of issuance) | 35,000 | |||
Vested in 2014 | (39,000 | ) | ||
Restricted Stock at March 31, 2014 | 511,130 | |||
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 $0.8 million in stock compensation expense was recorded in each of the three month periods ended March 31, 2014 and March 31, 2013. The stock compensation expense related to the restricted stock awards will be recognized over the average remaining vesting period of 1.9 years and totals $5.0 million at March 31, 2014 compared to 2.3 years and totaling $5.8 million at March 31, 2013. | ||||
At March 31, 2014, the intrinsic value of unvested restricted stock awards issued through March 31, 2014 is $10.5 million. At March 31, 2013, the intrinsic value of unvested restricted stock awards issued through March 31, 2013 was $9.7 million. The 2007 Plan terminates on May 24, 2017. | ||||
In the three months ended March 31, 2014, 21,842 options under the 1996 Stock Options/Stock Issuance Plan (the 1996 Plan) were exercised. As of March 31, 2014, there are 53,595 stock options remaining under the 1996 Plan which have an intrinsic value of $0.6 million. In the three months ended March 31, 2013, 12,375 options under the 1996 Plan were exercised and 6,500 options were cancelled. |
Income_Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2014 | |
Income Taxes | ' |
Income Taxes | ' |
8. Income Taxes | |
Income tax expense for the three months ended March 31, 2014 and 2013 was $2.4 million and $1.0 million, respectively. The effective tax rate for the three months ended March 31, 2014 and 2013 was 35.7% and 38.5%, respectively. The Company records tax expense or benefit for unusual or infrequent items discretely in the period in which they occur. 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. |
Fair_Value_of_Financial_Instru
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2014 | |
Fair Value of Financial Instruments | ' |
Fair Value of Financial Instruments | ' |
9. 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 March 31, 2014 and December 31, 2013 was estimated to have a fair value of approximately $779.1 million and $798.8 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 three months ended March 31, 2014. The fair value of the Company’s notes payable at March 31, 2014 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 $767.1 million as of March 31, 2014 and $787.6 million as of December 31, 2013. |
Operating_Segments
Operating Segments | 3 Months Ended | ||||||||||
Mar. 31, 2014 | |||||||||||
Operating Segments | ' | ||||||||||
Operating Segments | ' | ||||||||||
10. Operating Segments | |||||||||||
The Company operates in two business segments: (i) Leasing and Related Operations which involves acquiring and leasing, primarily pursuant to operating leases, commercial aircraft, aircraft engines and other aircraft equipment and the selective purchase and resale of commercial aircraft engines and other aircraft equipment and (ii) Spare Parts Sales which involves the purchase and resale of after-market engine and airframe parts, whole engines, engine modules and portable aircraft components and leasing of engines destined for disassembly and sale of parts. | |||||||||||
The Company evaluates the performance of each of the segments based on profit or loss after general and administrative expenses and inter-company allocation of interest expense. While the Company believes there are synergies between the two business segments, the segments are managed separately because each requires different business strategies. | |||||||||||
The following tables present a summary of the operating segments (amounts in thousands): | |||||||||||
For the three months ended March 31, 2014 | Leasing and | Spare Parts Sales | Total | ||||||||
Related Operations | |||||||||||
Revenue: | |||||||||||
Lease rent revenue | $ | 26,900 | $ | — | $ | 26,900 | |||||
Maintenance reserve revenue | 14,030 | — | 14,030 | ||||||||
Spare parts sales | — | 79 | 79 | ||||||||
Gain on sale of leased equipment | 309 | — | 309 | ||||||||
Other revenue | 967 | 715 | 1,682 | ||||||||
Total revenue | 42,206 | 794 | 43,000 | ||||||||
Expenses: | |||||||||||
Depreciation and amortization expense | 15,638 | 72 | 15,710 | ||||||||
General and administrative | 9,021 | 664 | 9,685 | ||||||||
Net finance costs | 9,359 | — | 9,359 | ||||||||
Other expense | 1,815 | — | 1,815 | ||||||||
Total expenses | 35,833 | 736 | 36,569 | ||||||||
Earnings from operations | $ | 6,373 | $ | 58 | $ | 6,431 | |||||
Total assets as of March 31, 2014 | $ | 1,185,812 | $ | 6,805 | $ | 1,192,617 | |||||
Total assets as of December 31, 2013 | $ | 1,194,800 | $ | 4,429 | $ | 1,199,229 | |||||
The Spare Parts Sales segment began operation during the fourth quarter of 2013. No activity occurred in this segment during the three months ended March 31, 2013. |
Subsequent_Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2014 | |
Subsequent Events | ' |
Subsequent Events | ' |
11. Subsequent Events | |
Management has reviewed and evaluated subsequent events through the date that the financial statements were issued. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 3 Months Ended | |||||||||||||||||||||||||||||||
Mar. 31, 2014 | ||||||||||||||||||||||||||||||||
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 for the fiscal year ended December 31, 2013. | ||||||||||||||||||||||||||||||||
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 March 31, 2014 and December 31, 2013, and the results of our operations for the three months ended March 31, 2014 and 2013, and our cash flows for the three months ended March 31, 2014 and 2013. The results of operations and cash flows for the period ended March 31, 2014 are not necessarily indicative of the results of operations or cash flows which may be reported for the remainder of 2014. | ||||||||||||||||||||||||||||||||
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. | ||||||||||||||||||||||||||||||||
Assets and Liabilities Measured and Recorded at Fair Value on a Recurring Basis | ||||||||||||||||||||||||||||||||
As of March 31, 2014 and December 31, 2013, we held no interest rate swaps. As of March 31, 2013, we measured 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 March 31, 2013 used creditworthiness inputs that corroborate observable market data evaluating the Company’s and counterparties’ risk of non-performance. The interest rate swap agreements as of March 31, 2013 had a net liability fair value of $1.2 million. For the three months ended March 31, 2014 and March 31, 2013, ($0.1 million) and $0.4 million, respectively, were realized as net finance costs on the Consolidated Statements of Income. | ||||||||||||||||||||||||||||||||
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. an offer to purchase) 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 March 31, 2014 and 2013, and the gains (losses) recorded during the three months ended March 31, 2014 and 2013 on those assets: | ||||||||||||||||||||||||||||||||
Assets at Fair Value | Total Losses | |||||||||||||||||||||||||||||||
March 31, 2014 | March 31, 2013 | Three Months Ended March | ||||||||||||||||||||||||||||||
31, | ||||||||||||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | 2014 | 2013 | |||||||||||||||||||||||
(in thousands) | (in thousands) | |||||||||||||||||||||||||||||||
Inventory | $ | 3,257 | $ | — | $ | — | $ | 3,257 | $ | — | $ | — | $ | — | $ | — | $ | (295 | ) | $ | — | |||||||||||
Equipment held for sale | 30,376 | — | 19,844 | 10,532 | 23,996 | — | 23,966 | 30 | — | — | ||||||||||||||||||||||
Total | $ | 33,633 | $ | — | $ | 19,844 | $ | 13,789 | $ | 23,996 | $ | — | $ | 23,966 | $ | 30 | $ | (295 | ) | $ | — | |||||||||||
At March 31, 2014, 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 assets that were held as inventory not consigned to third parties. The fair values of the assets categorized as Level 3 were based on management’s estimate considering projected future sales proceeds at March 31, 2014 and March 31, 2013. An impairment charge is recorded when the carrying value of the asset exceeds its fair value. An asset write-down of $0.3 million was recorded in the three months ended March 31, 2014 based upon a comparison of the asset net book value with the net proceeds expected from part sales arising from part-out of an engine. No asset write-down was recorded in the three months ended March 31, 2013. |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 3 Months Ended | |||||||||||||||||||||||||||||||
Mar. 31, 2014 | ||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies | ' | |||||||||||||||||||||||||||||||
Schedule of fair value hierarchy of assets measured on nonrecurring basis and gain (losses) recorded | ' | |||||||||||||||||||||||||||||||
Assets at Fair Value | Total Losses | |||||||||||||||||||||||||||||||
March 31, 2014 | March 31, 2013 | Three Months Ended March | ||||||||||||||||||||||||||||||
31, | ||||||||||||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | 2014 | 2013 | |||||||||||||||||||||||
(in thousands) | (in thousands) | |||||||||||||||||||||||||||||||
Inventory | $ | 3,257 | $ | — | $ | — | $ | 3,257 | $ | — | $ | — | $ | — | $ | — | $ | (295 | ) | $ | — | |||||||||||
Equipment held for sale | 30,376 | — | 19,844 | 10,532 | 23,996 | — | 23,966 | 30 | — | — | ||||||||||||||||||||||
Total | $ | 33,633 | $ | — | $ | 19,844 | $ | 13,789 | $ | 23,996 | $ | — | $ | 23,966 | $ | 30 | $ | (295 | ) | $ | — |
Investments_Tables
Investments (Tables) | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
Investments | ' | ||||
Schedule of investments | ' | ||||
Three Months Ended March 31, 2014 | (in thousands) | ||||
Investment in WMES joint venture as of December 31, 2013 | $ | 23,485 | |||
Capital contribution | — | ||||
Earnings from joint venture | 305 | ||||
Distribution | — | ||||
Investment in WMES joint venture as of March 31, 2014 | $ | 23,790 |
Long_Term_Debt_Tables
Long Term Debt (Tables) | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
Long Term Debt. | ' | ||||
Summary of the aggregate maturities of notes payable | ' | ||||
Year | (in thousands) | ||||
2014 | $ | 20,062 | |||
2015 | 34,307 | ||||
2016 (includes $349.0 million outstanding on revolving credit facility) | 376,589 | ||||
2017 | 38,746 | ||||
2018 | 33,804 | ||||
Thereafter | 263,600 | ||||
$ | 767,108 |
Derivative_Instruments_Tables
Derivative Instruments (Tables) | 3 Months Ended | |||||||||||||||
Mar. 31, 2014 | ||||||||||||||||
Derivative Instruments | ' | |||||||||||||||
Schedule of income effects of cash flow hedging relationships | ' | |||||||||||||||
Amount of (Gain) Loss Recognized | ||||||||||||||||
on Derivatives in the | ||||||||||||||||
Statements of Income | ||||||||||||||||
Derivatives in Cash Flow | Location of (Gain) Loss Recognized on | Three Months Ended | ||||||||||||||
March 31, | ||||||||||||||||
Hedging Relationships | Derivatives in the Statements of Income | 2014 | 2013 | |||||||||||||
(in thousands) | ||||||||||||||||
Interest rate contracts | Interest expense | $ | (125 | ) | $ | 366 | ||||||||||
Total | $ | (125 | ) | $ | 366 | |||||||||||
Schedule of information about financial statement effects related to cash flow hedges | ' | |||||||||||||||
Amount of Gain Recognized in OCI on | Location of Gain (Loss) | Amount of Gain (Loss) Reclassified | ||||||||||||||
Derivatives | from Accumulated OCI into | |||||||||||||||
(Effective Portion) | Income | |||||||||||||||
(Effective Portion) | ||||||||||||||||
Derivatives in Cash Flow | Three Months Ended | Reclassified from Accumulated | Three Months Ended | |||||||||||||
March 31, | OCI into Income | March 31, | ||||||||||||||
Hedging Relationships | 2014 | 2013 | (Effective Portion) | 2014 | 2013 | |||||||||||
(in thousands) | (in thousands) | |||||||||||||||
Interest rate contracts* | $ | — | $ | 472 | Interest expense | $ | 125 | $ | (366 | ) | ||||||
Total | $ | — | $ | 472 | Total | $ | 125 | $ | (366 | ) | ||||||
* These amounts are shown net of $0 and $0.5 million of of interest payments reclassified to the income statement during the three months ended March 31, 2014 and 2013, respectively. |
StockBased_Compensation_Plans_
Stock-Based Compensation Plans (Tables) (Restricted stock) | 3 Months Ended | |||
Mar. 31, 2014 | ||||
Restricted stock | ' | |||
Stock-based compensation plans | ' | |||
Summary of activity under the 2007 Plan | ' | |||
Shares | ||||
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 | (60,110 | ) | ||
Vested in 2013 | (258,822 | ) | ||
Restricted stock at December 31, 2013 | 515,130 | |||
Granted in 2014 (vesting on first anniversary from date of issuance) | 35,000 | |||
Vested in 2014 | (39,000 | ) | ||
Restricted Stock at March 31, 2014 | 511,130 |
Operating_Segments_Tables
Operating Segments (Tables) | 3 Months Ended | ||||||||||
Mar. 31, 2014 | |||||||||||
Operating Segments | ' | ||||||||||
Summary of the operating segments | ' | ||||||||||
The following tables present a summary of the operating segments (amounts in thousands): | |||||||||||
For the three months ended March 31, 2014 | Leasing and | Spare Parts Sales | Total | ||||||||
Related Operations | |||||||||||
Revenue: | |||||||||||
Lease rent revenue | $ | 26,900 | $ | — | $ | 26,900 | |||||
Maintenance reserve revenue | 14,030 | — | 14,030 | ||||||||
Spare parts sales | — | 79 | 79 | ||||||||
Gain on sale of leased equipment | 309 | — | 309 | ||||||||
Other revenue | 967 | 715 | 1,682 | ||||||||
Total revenue | 42,206 | 794 | 43,000 | ||||||||
Expenses: | |||||||||||
Depreciation and amortization expense | 15,638 | 72 | 15,710 | ||||||||
General and administrative | 9,021 | 664 | 9,685 | ||||||||
Net finance costs | 9,359 | — | 9,359 | ||||||||
Other expense | 1,815 | — | 1,815 | ||||||||
Total expenses | 35,833 | 736 | 36,569 | ||||||||
Earnings from operations | $ | 6,373 | $ | 58 | $ | 6,431 | |||||
Total assets as of March 31, 2014 | $ | 1,185,812 | $ | 6,805 | $ | 1,192,617 | |||||
Total assets as of December 31, 2013 | $ | 1,194,800 | $ | 4,429 | $ | 1,199,229 |
Summary_of_Significant_Account3
Summary of Significant Accounting Policies (Details) (Interest rate contracts, USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 |
In Millions, unless otherwise specified | item | item | Cash Flow Hedging | Cash Flow Hedging |
Derivative instruments | ' | ' | ' | ' |
Number of interest rate swaps held | 0 | 0 | ' | ' |
Notional amount of outstanding derivative instruments | ' | $100 | ' | ' |
Net fair value of swap liability | ' | ' | ' | 1.2 |
Net finance costs | ' | ' | ($0.10) | $0.40 |
Summary_of_Significant_Account4
Summary of Significant Accounting Policies (Details 2) (USD $) | 3 Months Ended | 3 Months Ended | ||||||||
Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2013 | |
Nonrecurring | Nonrecurring | Nonrecurring | Nonrecurring | Nonrecurring | Nonrecurring | Nonrecurring | Nonrecurring | |||
Total | Total | Level 2 | Level 2 | Level 3 | Level 3 | |||||
Assets at fair value and gains (losses) recorded | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Inventory, Net | $3,257,000 | $3,280,000 | ' | ' | $3,257,000 | ' | ' | ' | $3,257,000 | ' |
Equipment held for sale | 30,376,000 | 32,491,000 | ' | ' | 30,376,000 | 23,996,000 | 19,844,000 | 23,966,000 | 10,532,000 | 30,000 |
Assets at fair value | ' | ' | ' | ' | 33,633,000 | 23,996,000 | 19,844,000 | 23,966,000 | 13,789,000 | 30,000 |
Total losses on inventory | -295,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total losses on assets | -295,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Asset write-down recorded earlier | ' | ' | $300,000 | $0 | ' | ' | ' | ' | ' | ' |
Commitments_Contingencies_Guar1
Commitments, Contingencies, Guarantees and Indemnities (Details) (USD $) | Mar. 31, 2014 |
sqft | |
Office space | Novato, California | ' |
Commitments on rental lease | ' |
Area of office space (in square feet) | 20,534 |
Remaining lease commitment | $2,400,000 |
Office space | Shanghai, China | ' |
Commitments on rental lease | ' |
Remaining lease commitment | 49,000 |
Office space | London, United Kingdom | ' |
Commitments on rental lease | ' |
Remaining lease commitment | 131,000 |
Office space | Blagnac, France | ' |
Commitments on rental lease | ' |
Remaining lease commitment | 15,000 |
Office space | Dublin, Ireland | ' |
Commitments on rental lease | ' |
Remaining lease commitment | 37,000 |
Office space | Boynton Beach, Florida | ' |
Commitments on rental lease | ' |
Remaining lease commitment | 1,300,000 |
Office and warehouse space | San Diego, California | ' |
Commitments on rental lease | ' |
Remaining lease commitment | 88,000 |
Warehouse lease | Shanghai, China | ' |
Commitments on rental lease | ' |
Remaining lease commitment | $24,000 |
Commitments_Contingencies_Guar2
Commitments, Contingencies, Guarantees and Indemnities (Details 2) (USD $) | 1 Months Ended | 3 Months Ended |
In Millions, unless otherwise specified | Oct. 31, 2006 | Mar. 31, 2014 |
item | item | |
Engines and related equipment | ' | ' |
Purchase commitments | ' | ' |
Number of items to be purchased | ' | 3 |
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 | ' | 1 |
Aircraft and related equipment | ' | ' |
Purchase commitments | ' | ' |
Number of items to be purchased | ' | 1 |
Engines, aircraft and related equipment | ' | ' |
Purchase commitments | ' | ' |
Purchase price | ' | 36.2 |
Non-refundable deposits paid | ' | 2 |
Investments_Details
Investments (Details) (WMES, USD $) | 1 Months Ended | 3 Months Ended | 12 Months Ended | 36 Months Ended | |||
Jun. 30, 2011 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Mar. 31, 2014 | 25-May-11 | |
engine | item | engine | |||||
Investments | ' | ' | ' | ' | ' | ' | ' |
Ownership percentage | ' | 50.00% | ' | ' | ' | 50.00% | ' |
Initial capital contribution | ' | ' | ' | ' | ' | ' | $8,000,000 |
Additional capital contributions | ' | ' | 11,200,000 | 5,600,000 | 1,000,000 | ' | ' |
Number of engines transferred to the joint venture | 7 | ' | ' | ' | ' | ' | ' |
Number of engines purchased | ' | ' | ' | ' | ' | 17 | ' |
Capital contributions to date | ' | 25,800,000 | ' | ' | ' | 25,800,000 | ' |
Credit facility established by equity method investee | ' | 62,000,000 | ' | ' | ' | 62,000,000 | ' |
Investment in joint venture | ' | 23,790,000 | 23,485,000 | ' | ' | 23,790,000 | ' |
Number of engines in lease portfolio | ' | 26 | ' | ' | ' | ' | ' |
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 | ' | 22,200,000 | ' | ' | ' | 22,200,000 | ' |
Proportionate gain on sale of engines to joint venture interest (as a percent) | 50.00% | ' | ' | ' | ' | ' | ' |
Gain on sale of engines | 7,200,000 | ' | ' | ' | ' | ' | ' |
JA Mitsui Leasing, Ltd | ' | ' | ' | ' | ' | ' | ' |
Investments | ' | ' | ' | ' | ' | ' | ' |
Credit facility established by equity method investee | ' | $180,000,000 | ' | ' | ' | $180,000,000 | ' |
Investments_Details_2
Investments (Details 2) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Investments | ' | ' |
Earnings from joint ventures | $305 | $93 |
WMES | ' | ' |
Investments | ' | ' |
Investment in WMES joint venture at beginning of the period | 23,485 | ' |
Earnings from joint ventures | 305 | ' |
Investment in WMES joint venture at end of the period | $23,790 | ' |
Long_Term_Debt_Details
Long Term Debt (Details) (USD $) | 3 Months Ended | 12 Months Ended | 0 Months Ended | 3 Months Ended | 0 Months Ended | 3 Months Ended | 0 Months Ended | 6 Months Ended | 0 Months Ended | 3 Months Ended | 0 Months Ended | 3 Months Ended | 0 Months Ended | |||||||||||||||
Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | Sep. 18, 2013 | Sep. 17, 2012 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Sep. 17, 2012 | Sep. 28, 2012 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2011 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Sep. 18, 2013 | Jan. 10, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Nov. 18, 2011 | Mar. 31, 2014 | Dec. 31, 2013 | Jun. 18, 2013 | Sep. 17, 2012 | |
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%, secured by one engine | Note payable at a fixed interest rate of 5.50%, secured by one engine | Note payable at a fixed interest rate of 5.50%, secured by one engine | Note payable at a fixed interest rate of 3.94%, secured by an aircraft | Note payable at a fixed interest rate of 3.94%, secured by an aircraft | Note payable at a fixed interest rate of 3.94%, secured by an aircraft | Term notes | Term notes | Note payable at a fixed interest rate of 2.25%, maturing in January 2018, secured by three engines | Note payable at a fixed interest rate of 2.25%, maturing in January 2018, secured by three engines | Note payable at a fixed interest rate of 2.25%, maturing in January 2018, secured by three engines | Notes payable | Notes payable | Notes payable | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | Revolving credit facility | ||||
WEST II | WEST II | WEST II | WEST II | engine | WOLF | WOLF | engine | Minimum | Maximum | WEST | ||||||||||||||||||
item | Minimum | item | engine | |||||||||||||||||||||||||
Long Term Debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maturity term | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | '5 years | ' | ' | '3 years | ' | ' | ' | ' | '4 years | ' | ' | ' | '6 months | '8 years | ' | ' | ' | ' | ' |
Interest rate, minimum (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.40% | ' | ' | ' | ' | ' | ' | ' |
Interest rate, maximum (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.50% | ' | ' | ' | ' | ' | ' | ' |
Maximum borrowing capacity under credit facility | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $450,000,000 | ' | $450,000,000 | ' |
Remaining borrowing capacity available | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 101,000,000 | 88,000,000 | ' | ' |
Debt issuance costs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,300,000 | ' | ' | ' | ' |
Maximum borrowing capacity under credit facility before amendment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 430,000,000 | ' |
Debt to equity ratio | ' | ' | 3.87 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Variable rate of debt | 'one-month LIBOR | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'one-month LIBOR | ' | 'one-month LIBOR | ' | ' | ' | ' | ' | ' | 'LIBOR | ' | ' | ' |
Basis spread on variable rate (as a percent) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4.00% | ' | 2.25% | ' | ' | ' | ' | ' | ' | 3.00% | ' | ' | ' |
Net proceeds received from notes issued and sold | 5,000,000 | 69,000,000 | ' | ' | 384,900,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total notes payable | 767,108,000 | ' | 787,614,000 | ' | ' | 366,100,000 | 370,600,000 | ' | 435,900,000 | ' | 8,100,000 | 8,200,000 | ' | 700,000 | 1,000,000 | 27,800,000 | ' | ' | 15,500,000 | 15,800,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Number of engines pledged as collateral | ' | ' | ' | ' | ' | 71 | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 22 |
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% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
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 | ' | ' | ' | 36,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
One-month LIBOR rate (as a percent) | 0.15% | 0.20% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisition of remaining outstanding shares of previously held equity method investment (as a percent) | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Controlling interest assumed (as a percent) | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of term notes held | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of credit facility outstanding amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 349,000,000 | ' | ' | ' |
Aggregate maturities | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2014 | 20,062,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2015 | 34,307,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2016 (includes $349.0 million outstanding on revolving credit facility) | 376,589,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2017 | 38,746,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
2018 | 33,804,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Thereafter | 263,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Notes payable | $767,108,000 | ' | $787,614,000 | ' | ' | $366,100,000 | $370,600,000 | ' | $435,900,000 | ' | $8,100,000 | $8,200,000 | ' | $700,000 | $1,000,000 | $27,800,000 | ' | ' | $15,500,000 | $15,800,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Derivative_Instruments_Details
Derivative Instruments (Details) (USD $) | 3 Months Ended | 12 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
item | item | ||
Derivative instruments | ' | ' | ' |
Variable rate of debt | 'one-month LIBOR | ' | ' |
Interest rate contracts | ' | ' | ' |
Derivative instruments | ' | ' | ' |
Variable rate of debt | 'one-month LIBOR | ' | 'one-month LIBOR |
Borrowings at variable interest rates | $392.30 | ' | $392 |
Number of interest rate swap agreements | 0 | ' | 0 |
Notional amount outstanding | ' | ' | 100 |
Fixed interest rate (as a percent) | ' | ' | 2.10% |
Benefit recorded to net finance costs | $0.10 | $0.10 | ' |
Derivative_Instruments_Details1
Derivative Instruments (Details 2) (Cash Flow Hedging, Designated as Hedging Instruments, USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Effects of derivative instruments | ' | ' |
Amount of (Gain) Loss Recognized on Derivatives in the Statements of Income | ($125) | $366 |
Interest rate contracts | Interest expense | ' | ' |
Effects of derivative instruments | ' | ' |
Amount of (Gain) Loss Recognized on Derivatives in the Statements of Income | ($125) | $366 |
Derivative_Instruments_Details2
Derivative Instruments (Details 3) (Cash Flow Hedging, USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Effects of derivative instruments | ' | ' |
Amount of Gain Recognized in OCI on Derivatives (Effective Portion) | ' | $472,000 |
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | 125,000 | -366,000 |
Significant ineffectiveness on hedges | 0 | 0 |
Interest expense | ' | ' |
Effects of derivative instruments | ' | ' |
Amount of Gain (Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | 125,000 | -366,000 |
Interest rate contracts | ' | ' |
Effects of derivative instruments | ' | ' |
Amount of Gain Recognized in OCI on Derivatives (Effective Portion) | ' | 472,000 |
Amount of interest payments reclassified to income statement | $0 | $500,000 |
StockBased_Compensation_Plans_1
Stock-Based Compensation Plans (Details) (USD $) | 24-May-07 | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Mar. 31, 2014 | Mar. 31, 2013 |
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 | 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 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 | ' | 1,784,946 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number Outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Balance at the beginning of the period (in shares) | ' | 515,130 | 682,654 | 682,654 | 651,294 | ' | ' | ' | ' | ' | ' |
Shares granted | ' | 35,000 | ' | ' | ' | 130,000 | 283,000 | 21,408 | 28,040 | ' | ' |
Shares cancelled | ' | ' | ' | -60,110 | -8,988 | ' | ' | ' | ' | ' | ' |
Shares vested | ' | -39,000 | ' | -258,822 | -270,692 | ' | ' | ' | ' | ' | ' |
Balance at the end of the period (in shares) | ' | 511,130 | ' | 515,130 | 682,654 | ' | ' | ' | ' | ' | ' |
Stock compensation expense (in dollars) | ' | $0.80 | $0.80 | ' | ' | ' | ' | ' | ' | ' | ' |
Remaining average vesting period for recognition of unrecognized compensation expense | ' | '1 year 10 months 24 days | '2 years 3 months 18 days | ' | ' | ' | ' | ' | ' | ' | ' |
Unrecognized compensation expense (in dollars) | ' | 5 | 5.8 | ' | ' | ' | ' | ' | ' | ' | ' |
Intrinsic value of unvested awards (in dollars) | ' | 10.5 | 9.7 | ' | ' | ' | ' | ' | ' | ' | ' |
Stock options exercised (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 21,842 | 12,375 |
Options cancelled (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 65,000 |
Stock options outstanding (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 53,595 | ' |
Intrinsic value of outstanding stock options (in dollars) | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.60 | ' |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Income Taxes | ' | ' |
Income tax expense | $2,405 | $1,007 |
Effective tax rate (as a percent) | 35.70% | 38.50% |
Fair_Value_of_Financial_Instru1
Fair Value of Financial Instruments (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
Fair value of financial instruments | ' | ' |
Carrying value on outstanding balance of notes payable | $767,108,000 | $787,614,000 |
Level 3 | ' | ' |
Fair value of financial instruments | ' | ' |
Fair value of notes payable | $779,100,000 | $798,800,000 |
Operating_Segments_Details
Operating Segments (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
item | |||
Operating Segments | ' | ' | ' |
Number of operating segments | 2 | ' | ' |
Revenue: | ' | ' | ' |
Lease rent revenue | $26,900 | $24,487 | ' |
Maintenance reserve revenue | 14,030 | 9,229 | ' |
Spare parts sales | 79 | ' | ' |
Gain on sale of leased equipment | 309 | 686 | ' |
Other revenue | 1,682 | ' | ' |
Total revenue | 43,000 | 35,304 | ' |
Expenses: | ' | ' | ' |
Depreciation and amortization expense | 15,710 | 13,610 | ' |
General and administrative | 9,685 | 8,269 | ' |
Net finance costs | 9,359 | 9,227 | ' |
Other expense | 1,815 | ' | ' |
Total expenses | 36,569 | 32,780 | ' |
Earnings from operations | 6,431 | 2,524 | ' |
Total assets | 1,192,617 | ' | 1,199,229 |
Leasing and Related Operations | ' | ' | ' |
Revenue: | ' | ' | ' |
Lease rent revenue | 26,900 | ' | ' |
Maintenance reserve revenue | 14,030 | ' | ' |
Gain on sale of leased equipment | 309 | ' | ' |
Other revenue | 967 | ' | ' |
Total revenue | 42,206 | ' | ' |
Expenses: | ' | ' | ' |
Depreciation and amortization expense | 15,638 | ' | ' |
General and administrative | 9,021 | ' | ' |
Net finance costs | 9,359 | ' | ' |
Other expense | 1,815 | ' | ' |
Total expenses | 35,833 | ' | ' |
Earnings from operations | 6,373 | ' | ' |
Total assets | 1,185,812 | ' | 1,194,800 |
Spare Parts Sales | ' | ' | ' |
Revenue: | ' | ' | ' |
Spare parts sales | 79 | ' | ' |
Other revenue | 715 | ' | ' |
Total revenue | 794 | ' | ' |
Expenses: | ' | ' | ' |
Depreciation and amortization expense | 72 | ' | ' |
General and administrative | 664 | ' | ' |
Total expenses | 736 | ' | ' |
Earnings from operations | 58 | ' | ' |
Total assets | $6,805 | ' | $4,429 |