AER - Earnings call transcript Q1 2021

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Operator

Ladies and gentlemen, please standby. Good day, and welcome to the AerCap Holdings N.V. Q1 2021 Financial Results Conference Call. Today’s conference is being recorded, and a transcript will be available following the call on the company’s website. At this time, I would like to turn the conference over to Joseph McGinley, Head of Investor Relations. sir. ahead, go Please

Joseph McGinley

Pete and call. Welcome our With Kelly; Financial Officer, operator, quarter Chief our XXXX Aengus Officer, Chief our conference me and hello, you, to everyone. first Executive Juhas. Thank today is

Before are you during some remind like that facts, historical today’s may we call, statements. statements which call, begin conference would to I this not made be forward-looking

release issues statements. to or uncertainties update could Forward-looking affect may statements cause law, such events risks implied after information or that events, expressed those in XXXX. through dated is AerCap’s our be end and replay. by that webcast reflect and circumstances undertakes to will at other aercap.com. differ run time involve release We’ll or materially copy obligation, from this This we’ll presentation at of archived at that statements for public results materially imposed on allow is aercap.com website can for concerning forward-looking no than open and the arise the earnings performance and call found AerCap in our April our Further actual call. or future revise conference Q&A. call that A any and publicly shortly be to information XX, to presentation simultaneously earnings available are being earnings

over one As ask call analyst Kelly. one Aengus and question to I a follow-up. would now themselves I the to reminder, limit will turn that

Aengus Kelly

net $X.XX Good share. to first a earnings, report for million with of morning, quarter earnings income us per and everyone, strong thank I’m or pleased you of call. joining our quarter for $XXX

that future an to to the in in significant recovery momentum certain performance testament by air environment a airlines the the the during aviation a XX with of the of While this complete of negotiate there are our with increased many focus raised confidence still team due It transaction evidenced wide-bodies, we to industry, This the AerCap the were record is efforts improving and pandemic the was leasing our and by $XX despite as to quarter required quarterly AerCap. year, of first diligence, and GECAS commitment the regions strong XX we lease GECAS the in team to able and for looking traffic including quarter. billion the continue world, first facing aircraft, accomplished funding. see challenges

GECAS the value So clearly, quarter the an acquisition transaction. believe for as create exceptional first this the at that cycle our for the to we all shareholders. in one time right was AerCap right is announced We the

strength our will of fourth additional As revolving the importantly, will to a are positioned announcement, of to transaction, secured the billion credit transaction also pleased start. that am to we enhance a Until our an mentioned closed in commitments to close and ground we continue have then, $XX loan, XXXX. of running financial we we make loan, combined to sure the consisting $XX funding hard the further of report bridge billion term I we expect $X.X with to banking $X which syndicate the the facility, billion billion work related company. recently the from we hit quarter in

what quickly programs, successful rollout once Now which seen we gained The the the will to as of air believe of demand the U.S. businesses above, the demand majors some the of This come, year recovery vaccination of course been mentioned in that pre-pandemic in heard firmly not I unfortunately of international which of sector, consumer reopen. leisure is, said, past in but parts higher number in the the the momentum and echo tied traffic have we around is regions, Translating has return of travel being to with from positive over reopen. business shoots course, by XX% hearing a couple will That of markets various into weeks, U.S. you levels. travel see weeks. Many more smooth This continue of should recent world. for as green in of we’re the commentary led significant other recovery to have regions. move too.

XX% or We where weekly flights. and traffic This weak to the surpassed XXX,XXX is levels. to with pre-pandemic have environment including coupled excess XXX% are a we’re certain flights of as account Russia, comparatively, the where Europe, further countries, its wave levels; weekly countries rollout, travel led seeing XXX%; in XX,XXX these the of In Together, vaccine XXXX, now Korea, start and and XXX%. week. Greece Turkey or in of in X,XXX a XXX%; XXX,XXX equivalent for flights slow renewed fourth at strength relatively XXXX Asia, of to South China, X,XXX the has Only the of levels countries, in U.S. restrictions the at to domestic in those level, XX,XXX related market number fly flights quarantines. travel remains Vietnam, continue flights, of

However, to the improvement European and markets. in to agreement will summer travel developments in Switching the the on vaccine Union the back in AerCap. of put for in positive green availability spur the weeks time certificate place coming a European

of We our demand continue greater and levels activity customers. to see from

from aircraft months. for agreements XX in quarter, lease of all countries, XX compares we XX in this the signed And airlines lease with mentioned, XXXX. highest I the to As XX agreements

in a were the confidence. with key our XX QX of customers. clear level are of record for conversations a there demand I fact, in number In quarterly emerging wide-body and from themes activity two This agreements aircraft, wide-body leases. believe pickup lease XX of reflects

strong a in and their return of travel mostly simply confidence growing timing. is is demand first the The of that as and it matter

the that financing. of is to will second The for partner choice lessors be continue aircraft

confidence is the first show on confidence the eased, week levels that clear vaccine inevitably enjoying of consumer administered, further as other million regions confidence running made are This in roll soon progress been size. add to the This consumers will to XXX around X in equivalent end to and seven per spread consumers already to where capacity. acceleration vaccine governments every weekly will China the to be billion restrictions The is the is giving at vaccine UK, rollout, the that restrictions with have rising. to driving back once and this over there doses The greater approximately doses an figures X provides additional weeks. on an and latest the be of So accordingly. eight billion Over rollout will doses of hope abundance airlines point, evidence are U.S., react rollout consumer freedoms. ability

XX% will which our all residual is frees theme aircraft we market order growing eliminates aircraft aircraft value second leasing demand up Airlines leasing seeing technology aircraft see capital, and to This XXXX. is benefits of to allows a how of that we are clear The believe transition help leasing future into risk. grow continue in availability we share, over the though financing. leasing, aircraft for faster book and placements, with until inevitably new from no have will

that No are our on reasons as the to a continue times, over to our With taken actions we and customers to the hand of for will are look has the we strong, Pete the financial call that, have of the behalf we will date continuing future. to review to health gathering significant optimistic be for actions and demand in the pace, So vaccine of as take on rollout from but see unprecedented focused doubt, be about delivering forward, I travel improving you our shareholders. detailed we performance. airline we the AerCap can

Pete Juhas

everyone. morning, Good Aengus. Thanks,

the for total result first rents of as billion includes the This $XXX in the impact transitions. airline to billion quarter. million of first $X.XXX first lower quarter, the cash compared Basic restructurings lease and a quarter was of which the were Our revenues accounting, for $X.XXX quarter primarily XXXX. aircraft were for

for cash our the collection around XX% by X% as quarter, million rate and of Our XX. modestly increased first to balance March $XXX deferral was

it’s slower COVID additional to we’ve The And ongoing in impact be travel winter of seasonally the course, northern the season for had many tends related countries. in airlines year, of because the quarter restrictions this first Hemisphere.

the passenger and these expect the year to the over rollout We recovers. course as of continues as metrics traffic improve vaccine

on progress airline restructurings. of seeing number currently We’re major a

are restructurings off the these from of airlines bankruptcy accounting these LATAM recently progress that court making that’s We agreed we its of expect the year. by the the unsecured airlines proceeds ultimately emergence come the in claims during the of completed, bankruptcy. to our LATAM on in to of and and the LATAM sell course determined restructuring As be cash will see one case. sale some of bankruptcy, is

the back P&L. to Turning

maintenance million an revenue in $XXX in the Our terminations. quarter, million lease due from to from primarily higher maintenance increase were increase The was $XXX XXXX. which rents resulting was first

demonstrating quarter last mainly our million, of of the income sales to for first we year In for of was due the the during $XX a first we age aircraft owned the gain quarter our our for increase $XXX on income. terms of and sold first sound the of Other total sales, net average years aircraft million. higher the was XX quarter, carrying The nine old, $X million was and quarter values. over sold interest was aircraft

Turning now expenses. to

$XXX were $XXX quarter decrease for first a for quarter, the expenses of XXXX. total million Our million the first from

leasing average during mainly year, year. lower asset quarter, this $XXX quarter, and had debt to to mark-to-market well million Interest costs assets. as top-up lease last and in corresponding Other which due year. was last expense and a down terminations decrease $XXX $XX the in depreciation lower cost from revenue. a the asset due amortization as in first expense lease contributions was lower maintenance lower primarily were by were average lessor to the $XX million Our million from $XXX quarter, the or the first offset We fully That quarter. $XX balance and sales related million decrease and was due $XXX million from a quarter, that expenses first debt expenses impairments to for XXXX, in a of in decrease million was million of

pretax compared Our the $XX or share. income together, decrease million per for about $X.XX AerCap $XXX million of XXXX, million XX%. for of SG&A That of million of a generated net tax. GECAS $XX first the expenses of includes the million in after the related were quarter, that quarter Putting or $XX to $XX costs quarter transaction all to first

Excluding those million for per quarter net was costs, or share. the $X.XX income $XXX first

strong We continue to a maintain position. liquidity

next total our XX, the March our usage sources X.X times. of That above to $X.X billion, resulting target well times. were current of liquidity of X.X in XX months remains sources As of ratio

cash high billion. excess remained $X.X at coverage Our also

very We maintain balance strong sheet. continue a to

target XXXX. below where currently and which is X.X:X, of began ratio leverage Our we X.X:X, ratio below is our

billion $XX Our of of total worth around low XX% and secured debt at currently percentage continues we to remain unencumbered assets. assets, have

cost Our lowest unsecured a and issuance the coupon average fees of five-year of X.XX%, with impacts, the January, quarter. excluding was coupon raised $X other for billion we X.X% first costs, senior debt, debt history. company’s In the in of bonds

I’d XX their also the Gus in banking of facility XX billion, We which be banks, and strong that for bridge we transaction. facility Sachs As we upon and process strong very banks provided syndicated saw had also to participate. extremely syndication originally the the of that banks well entered this strong all revolving participating. $X.XX loan interest four-year Citibank facility we $X mentioned, the time, into were throughout completed from demand to new The facility the for At and a closing the available as group were GECAS bridge for same billion by a And term transaction. Goldman of financing thank a $XX transaction. our to credit support with total like for GECAS billion total will

of So expenses, overall, a transaction side, $X.XX. with we income EPS excluding net of had operating and $XXX the million, on quarter positive

and up looking future reflected As rollout recovery fleet for this in place in putting the plans more the we’re you see of leases air the can we quarter. airlines progresses, vaccine seeing And to signed that traffic. XX the

that, syndication our the shareholders, the the we progress and Q&A. will of call can submission a GECAS the with the open significant transaction, the you the up positive the of that course, of news regulatory With bridge financing closing towards of and approvals, quarter biggest for be which Of first the transaction. we’re operator, for was making believe

Operator

Morgan. Baker We’ll with begin Jamie [Operator Instructions] J.P. with

Jamie Baker

good Hey, everybody. afternoon,

same couple operating estimate So was the number months, of slide, for next the it final billion. The monk last me. $X.X a and for cash That’s XX flow questions quarter. that

that rolling a obviously forward. the back it positive you some fact guide, might quarter more the affirmed So you that with one didn’t on but increase push

can we into rate tie trends? and guide from the this What read billion? current does how lease So collections $X.X

Aengus Kelly

Jamie, recovery traffic. we’ve gradual really a terms Well, in air assumed here of

haven’t future, flying the we we course aircraft cash flow increased operating next in their we of the XX as a for gradually assumed have the so our there. recovery months, built forecast that And during but rapid

So reasonable one It’s maybe it be think higher than a projection think look, in a it’s I respect. But that could for that. conservative I us.

Jamie Baker

Okay.

regulatory, be GECAS late And question, you guess, than issuing any clear Second biomarkers looking posts have the later? Spreads costs? to rallied for, of I funding financing are curious in what hedged debt? rather why not as locking sort or whatever the be, of deal-related have need to comfortable you you’re you and of gold so sooner just obviously

Pete Juhas

Yes.

regulatory them coming have up, approvals, of know. May. milestones got as we’ve got you submitted of end half we’re our a should by we putting – Jamie, So number of in We’ve We’ve our the about got there. AGM

And you’re in them. of progressing. with of key you are regulators we’re things as those, some before those so that dialogue those part And submit

we’re the to in market, we’ll hedging put appropriate time. place the on So things side, and the monitoring at look

Jamie Baker

Okay. Thank you much. very

Aengus Kelly

Sure.

Operator

question We’ll with now Davy. to from move Harvey Go Ross please. ahead, a

Ross Harvey

wondering priorities you to for reduce as to leasebacks, you I’m on the objective particularly completion. involved? just AerCap the advance much business the meaningfully deal possible. comment looking Can itself, to simply And Hi, and of in regards sale as are afternoon, get on Gus your in levels Pete. mean, I as leverage GECAS

Aengus Kelly

and were aircraft minute – able you saw over in on of foremost, standpoint for aircraft. leased of that Well. from of and paid. sign airplanes the our is evidence clear Ross, at first that quarter to getting focus one changed months, I and getting the on an priority the And think course hasn’t XX of leases the I quantum for we first six the think the operational by an the operational last business

remain sale-leaseback working I closing, of quite be in course, that center. running Of GE front margin, to will single honest. are ground when And be the Ross, hit every and that to So we at to day. business the with to able be get to we reference think the closely would

Ross Harvey

Understood. Thanks, Gus.

I’m in wondering, we of wondering, the lines? cost talk in Second just synergies Thanks. $XXX you X-K. as one follow-up, that other a and you highlighted should whether SG&A recent us million can benefits number just through And consider

Aengus Kelly

through. other coming things see benefits of Well, terms depreciation Ross, you’ll and that in like

financing where I think you’ll also we when GECAS place. see some interest in benefits is today relative the put to

be So you dollars depreciation it as lines they in that’s to will today. would see other where well. that relative we side, And going hundred million the to be to – expect several are on

Ross Harvey

you Thank much. very Great.

Aengus Kelly

Sure.

Operator

our Credit Orenbuch Now moving come question, that and next Moshe with will Suisse. to from

Moshe Orenbuch

thanks. Great,

activity? transactions closes, that create – guess, GE that be I You deal would that the mentioned of that leased XXXX. of to – allow once the is or fully the some business available there you But because you’re had you’ll have through some that that possibility aircraft there’ll kind are

Aengus Kelly

mean, purchase the agreement, market. positions see take agreement, post sale to and trends the we until the the that’s order we available Moshe, the closing XXXX. what as order advantage the when GECAS What how its – say many I time on in when stands AerCap state and airplanes to that we’ll in don’t get parameters they frame them, we have book, book, leased of of anything Sure. have them how separately left the managed we’re within where of fully

Moshe Orenbuch

they’re assets there’s Pete, about what that Got resolution? you those the might that’s are, bankruptcy for? mean how and you when it, talk LATAM a thank And you. mentioned accounted situation. marked how Where could

Pete Juhas

Moshe. balance our have don’t we that, sheet anything Well, for on

other the come will decided in said, as it I So Ultimately, we be I would accrued But court. as ultimately, by expect bankruptcy that haven’t income. to anything.

see of think million plays be we’ll amount, I that in dollars, terms really it but and have could several hundred all out. wait to how

Moshe Orenbuch

So you’re all essentially? revenue saying would it be

Pete Juhas

I’m the just again, could – idea Yes. to ultimate be. it But an predict hard what amount. to that that’s and of timing subject the giving of you it’s

Moshe Orenbuch

than anything be right? Right. But more would zero,

Pete Juhas

true. That’s Yes.

Moshe Orenbuch

Very very Thanks good. much.

Pete Juhas

Sure.

Operator

Helane We’ll ahead. Go Becker with hear now from Cowen.

Helane Becker

Did how much, the have back? deferral paying for XX%, but Thanks say stopped airlines Thanks asking talked being think are everybody. for requests time. further and deferrals cash trending? your I about operator. then collections you just are the you you very now Hi,

Aengus Kelly

mix there, a It’s Helane.

And news locked you and world around to recent of in As European February, have which at had the But remember, week well events the U.S. had the there. Brazil. the other down. a we the in look in are the under first slowdown we moment, from parts. heard lot well China, – are quarter, Europe obviously, in still you a carriers countries, post-Christmas as things during are going things we going January,

that grant that, then, So environment, we’ll bit little we carriers. to return try and had a deals in always in neutral. keep some of to give these But for more the NPV

may have we as So our as those part leases got extensions well. to discussions of

Helane Becker

Okay.

would the that there for? rates Or do in would then to be leases that have outlook? extensions you leases Like portion you restructured that restructure included you’ve percentage So either extensions? might maybe were of some is case, customers you that or in restructuring lower had if at

Aengus Kelly

said, I mean, course, total be the you’re is increase XX… number Of as big we in about numbers talking deferrals here. I of not mean,

Pete Juhas

million. $XX

Aengus Kelly

Helane, $XX totality. number a big in it’s not million,

Helane Becker

Right. you. Got

on Okay. what’s we’ll then so happening be will All right. regulatory GECAS, you publicly see the filing that the there? And be able filed, they forums. Will asking the be you’re approvals documents to for

Joseph McGinley

at Helane. think the expecting There we’re the I are to approvals on jurisdiction, XX about file. that that depends moment

individual think on publicly each not. or jurisdiction, I whether depends that’s available it So

Aengus Kelly

is language There Helane. won’t into plied What English. be

Helane Becker

Thank you. right. Google need Yes. I’ll get All out. to translated

Aengus Kelly

to have Kazakh. push You your up on

Helane Becker

True. Thanks.

Aengus Kelly

Sure.

Operator

will from we Stephens. Caintic question a with Vincent And now take

Vincent Caintic

lease going forward. rates Thanks. And the first question on

those points here deliveries? the since, you to – was those I strong the next you. placements climb rates how deferrals cash or accounting XX should the repayment think, how as I curious nice and you net have, to with spread basis expect in XX airlines the XX deferrals, the quarters? your see does looking just of over spread that the think it’s pay about your orders the are coming then I expanded have, when lease yield new we’re And that the – you net quarter-to-quarter. on So have is rent, we affect back Thank rent

Aengus Kelly

the about lease the Let first me part rate. answer

we you the huge So Vincent, and are other noted, organization. airplanes, look, as pandemic given we on facing background at the a the and XX number, moved least demands the

course, terms of labor lease is what In When it, costs, an evident airline all there they pay no to there’s costs, aircraft, of an they’re rates, out of cost are maintenance the look, taking of part for demand those still a lot it’s matter committing with crew that associated costs takes there. airplane. an costs,

in there So the take confidence them, means is fact they’re willing out future. the that there to

of where into the that to restarting as rate leases variability to is the new period, lease. XX lease Now move first And most and want that where But deferrals? on you over rate part following a months on to there’s rental do their aircraft varies so Pete, the the from beginning facilitate to the the varies fixed from comment these And so, on to airlines it’s traffic. or go that there that variable will first transaction, months of XX utilization. around at then or a element based for – aircraft.

Pete Juhas

Yes.

won’t the and the because those you the up spread affect balance. so cases, accruing – deferral think of cases, on it, deferrals we the the a we’re net in recognized we’re the Vincent, if building about second So themselves in deferral revenue one, have repayment

What you deferrals airlines on that’s the because flow, revenue on coming accounting million, that’s an those is revenue I and cash impact thread. of obviously and have for revenue, when on $XXX net impacting flying cash today. therefore, it’s have spread have about doesn’t actually repaid, off positive right. but will planes, these mentioned as it that impact and obviously, So get a an

restructuring, those the right. most in going or be of driver, that those other flight obviously, to because, of been bankruptcy airlines biggest mostly the that’s So return have for are

revenues come revenues almost been they no in as because you’ll start basically so those, emerge from they’ve see And to those now.

Vincent Caintic

good I very yes, That’s the on net that up helpful. spreads. mixing Okay. And I the and appreciate was accounting, deferrals for cash looks so

because together, there you. incremental so your combined just wanted $X all least So it had about one I thoughts. and plus wanted we on of are questions better, like and to two guide that question, to if be spreads it particularly, second is appreciate equals prior revenue go frequent net the like I one And given just shareholder thoughts circular, else least get chance detail the add of to doing at at I on the to get through I we there. investor seems billion a is Or talk on seems your revenue billion. any revenue should side? And AerCap GECAS the consider? whether need Thank one something $X

Pete Juhas

mean, as that to not It’s that a apples it’s also have apple accounting way the right. I to impacts going AerCap everything. simple and because purchase it’s accounting and of you’re you Yes. not is not it, different number just have do the GECAS as that, unfortunately, and

so I it. about we think guided that’s did And in we to thinking why what really

you just So that’s say, the to what be. and going two sum okay, it’s can’t up

Vincent Caintic

offline, follow-up thanks much. I’ll so you. but Got Okay.

Pete Juhas

Sure.

no problem. Okay,

Operator

with Deutsche Patel Koosh from come will Bank. question Next

Koosh Patel

do you the million think Do the maybe, think peak reintegrating Hey, you the What here? kind view $XX type think $XX number in is – about a is great, have And to guys think internally could we back? that get on revenues? And that, following would think be how mind, that if million to too. about horizon into representative over guys we maybe of we provide that of good is the guys. you time, we you of figure When do on any possible this? upside this accounting here? the cash million morning, $XXX balance, that Do what just

Aengus Kelly

Sure.

going – cash we’re accounting, that impact think the time, abate to I basically. So I year. this to see would it’s throughout – we of going cash over But to will say, continue

couple million quarters. as guide if I a come back. they going about as and the are see to thinking of out airlines then those I or said, that come as think we’re next bankruptcies over restructurings reasonable we’re as $XXX completed, those it the But So is –

that could on time. see terms you how – much So $XXX like it’s over in think recovers, recover. But look, going that XX yes, of happen I probably million, you to $XX that million of see

As at be I said, an but not going back, all it’s to would $XX that, $XX it’s million once million, I like guess. come thing, something to to going

Koosh Patel

Okay.

the Okay. the Or aircraft this? you Aeromexico had you then status that long-term? in some the the for AerCap they’ve general Great. stay see place second if the And that they saw Aeromexico wanted of and announced could them on some are a I to with whether And intent as the second these? XXX Or question I update in had, aircraft Aeromexico struck included any us owns sorry you just question just unleased agreements we are to has And guys to of recently, in of process – was, have with restructure do – to update have. to you remarketing Aeromexico? leases

Aengus Kelly

And assumption of Aeromexico procedures the for are transaction. in aircraft court approval We of Aeromexico expect the stay to there. the front revised now and the

Koosh Patel

Okay. time. Appreciate a Thanks the guys. lot

Operator

question We’ll move O’brien Goldman Instructions] [Operator Sachs. with from to a Catherine

Catherine O’brien

despite decline the And since year. pandemic, I Actually, least Thanks tracked. of the one that the the start what time accounting everyone. morning, impact that’s I have cash time. the seen HNA more on for first we’ve versus accounting. is This cash Good this earlier bankruptcy at actually have

Or was lease? decline? the So was aircraft just the sequential of what’s Thanks. no just official is that? driven some contracts? longer driving under ground, the wondering, but Are any new I aircraft back that what on wondering on driving of by

Pete Juhas

Katy. Sure,

other So fourth well, airlines it. in we’ve come off actually, But of now in we’ve cash quarters planes had the them they last of carriers. that on it. for Norwegian example, we the our on of of a Norwegian, I impact to part you placed accounting were couple the some H&A, due year had was with all mean, put saw and so quarter, already

many ones, Aeromexico, elsewhere, just because less been impact, doing, the moved of are other with you’re But for you those where we those example. So with what see the – of mentioned, so have and going out they’re as of to carriers, an seeing planes planes you’re the cases, of majority in planes they stay we’ve right, will moving obviously, were. Gus these in

that’s think, the main fourth I we I I said if look driver it million. last, because So think at quarter, $XXX was

So it’s the how exactly play It’s to But – to was expect saying of over yes, exactly this few the somewhat I next hard over the to course down down that’s out quarter. quarters. year. answer, know as going previous the in I do that come

Catherine O’brien

Pete. Maybe one quick follow-up to that,

should probably to if the the current majority should it? a stay see their of sense down when track a to be of good about So us $XXX of with remainder those think million us way give exercise of the lessees. proceedings, we we with aircraft expecting that like right for you’re to just progress that come these bankruptcy to to and good expect the Is will that

Pete Juhas

I collection. of some They’re certainly just where not probable of bankruptcies. mean, assessed I the ones, have major we Well, not are the these for for as think – airline

see agreed, those is certified once of don’t should right. you agreed some back, yes, coming ones, those bankruptcy has small. and major And court and that, some the would quite planes think – And that worth you an have But are restructuring then the be will countries, mean or situations. in equivalent them I yes, leases for I frankly, it it following be on those

cases. So most of that’s – that will the trigger those in be

Aengus Kelly

will vaccination along to that, when driven by be the underpinning all say, vaccine Katy, the it’s confident exit bankruptcy think, they’re and fair in well that countries. structures will from moving those I exit that is those of the from profile airlines

Catherine O’brien

an that higher just of about It seeing are factors putting of lease for of And second those question, earlier what are little of level second you just perhaps in this those little placement delivering? quarter, a how think in to of and far the the a the color. bit activity on And out just then future you’re sense. lease question, a a out then my that of how on sense totally Thanks contracting versus That lease used a a placements really makes factors we in you’re one. you saw on couple you how terms for should now aircraft rate multipart versus bit sounds us just compare years a deliveries pre-COVID? follow-up but of can give rate to

Aengus Kelly

it progressing, metal, lease and take with is see variable down a is after months. which utilization airplanes a back course they Sure. the is XX want back have rental, for rollout are Well, to additional that, be element all just the on to we And either of pre-pandemic. into this bit airlines which now. based example, or placed to of in there, as if half environment. said, which by were where about have it’s to flip the And I want – – was the XX back over us That’s the start the rate being token, aircraft still great. to the the months, the future. with And there’s those us, come rental, in airplanes have at last moved But vaccine it a that from given that obvious. positive will And still I fixed be that XX the coming come pandemic those near in then very that will same first

do that’s order the you’ll in coming it goes. to of see couple and wait one you any you’ll a are have book a how totally our off don’t airplanes that That’s where different market. years’ and time, business to As

Catherine O’brien

for the so Thank much time. you

Aengus Kelly

Sure.

Operator

Andrew Lobbenberg from hear with will HSBC. we now And

Andrew Lobbenberg

I’m you placed the it, that but being speaking are can power XXXs. by I’d on can around about what the question at previous you just paying to and but North aircraft say. a that. the half that were the hour about they’re curious bunch interested to don’t everyone then curious market are I then Norwegian don’t to fixed that that to going what you are what from commentary telling the aircraft because, Norwegian what I’m Atlantic transitioning quite I rate, just a mean, And on be see are I to aircraft say can build But mean, Gus, other around know you of are in precisely know going paying. North, I discount. offer current is the are on the

I plans Or And be held think they not. they LATAM, But they be they’re which given your will that to remarket? on they how impacting how a had now look them? are to easy shiny to you lovely what keeping, A bit it returning want and but them why economics? them. don’t is surprised then have that

Aengus Kelly

used Atlantic and cash rates, don’t their getting will lot a that Norwegian was; pay. from be But comment Yes. importantly, on attractive – of costs associated what North a us. a it on with two, can’t transition North time, they’re I they it in; Look, I then Sure. is transaction rental, reasonable perception that come don’t reconfiguring we of North again, and very But wide-body a very Atlantic to saying up and of step about the has one, on have standpoint, will our LATAM will what were airplane know. what deal aircraft. for stays just cash aspect will on the would us those what LATAM the any earlier from you’re based rate But have claim the they’ll airplanes, customer. today’s we LATAM market the in AXXXs, get handing back. that as And attractive rentals you of get loss be of yes, Pete, for relation quite but as paid number them. we will course, leased In and from they them the new versus are at a are be have we ongoing for around leased. that These to suffer our a a discussions heard in against yes, reduced correct. lower market, over

So we that incur. losses the should idea the is that to offset of would

Andrew Lobbenberg

to tighter because it say Or is XXXs the remarket be XXs, that a But naïve? fair than that will Thanks. the to market? easier it’s is

Aengus Kelly

wouldn’t that. I say No,

– has a it’s I airplane. aircraft XXX smaller think the that an is

it is very we’ll larger an But has a large a so it’s service. base, the And and with excellent AXXX airplane, deal user this. but aircraft into slightly been

Andrew Lobbenberg

Thank you.

Operator

And remarks. call or to this additional Kelly question-and-answer will the Aengus will ladies for and back your I closing conclude any session. turn over gentlemen,

Aengus Kelly

Joe we to Monday, few on environmental, on report hand Joe, of as I much shortly. seen that’s well, us and you But this all you annual you, virtually social on to you up back to many thank joining by I very a We say have report. seeing our look may our ESG published would Well, governance words? call. forward want like our for aspects, coming may at AGM suppose, to you proxy

Joseph McGinley

Sure. Thanks, Gus.

a our part period to are and story, our what’s formed And of area. something is the in We’ve Board the hugely recent transparency those increase concerted and for management AerCap who that made time. involved a So just company. new for reporting in of to the in long efforts strategy ESG years the of always been have senior of you

that key mind, highlight just report initiatives like we couple that in comprehensive report. I’d ESG XXXX week. with our from So in published the a of earlier to

in and see well sustainable increased for do our carbon invest to impact transaction. with is that And industry. end technology take clean to modules way we as electricity operations Climate families. us as project new to well as first And of GECAS we and the the the we which own First XXXX, the that to XX% of as we income most offsetting XX% this, in helps coming solar make the have that higher impact The that the is travel an in best by prevent biodiversity cell a DFAR the And the of that on to stations for as to doubled second target local the of providing business aircraft our China level in years. provide fleet fuel-efficient XXXX, and in the we in Brazil, for our partner includes

our So call report you on after you’ll if any more to website of find that the follow-ups. have further me and out to free reach feel directly

call. with can that, close operator, you the now So

Operator

this now may you. participation, disconnect. your gentlemen, and conclude you Thank will conference today. Ladies for your you for Thank and

AerCap (AER) 28 Apr 212021 Q1 Earnings call transcript