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Irish aircraft leasing giant AerCap delivered record income last year

Board approved new share repurchase programme of up to $500m of ordinary shares

Aengus Kelly, Aercap chief executive. Photograph: Dara Mac Dónaill

Colin Gleeson
Fri Feb 23 2024 - 17:19

Irish aircraft leasing giant AerCap delivered a record net income of $3.1 billion (€2.9 billion) last year.

The lessor, which buys aircraft from manufacturers using a combination of its own cash and borrowings and then leases them to airlines and other customers, published results for the fourth quarter and full year ended December, 2023, on Friday.

Its full-year net income amounted to $13.78 per share. It delivered a net income of $1.1 billion, or $5.37 per share, for the fourth quarter.

The company, which is listed on the New York Stock Exchange, said earnings, adjusted for non-recurring gains, came to $3.11 per share. The results surpassed Wall Street expectations.

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The aeroplane leasing company posted revenue of $1.9 billion in the fourth quarter, while revenue and other income increased 8 per cent to $7.6 billion for the year. Total cash and cash equivalent increased 4 per cent to $1.8 billion for 2023.

AerCap shares have increased almost 6 per cent since the beginning of the year. The stock has climbed 31 per cent in the last 12 months.

During the fourth quarter, the company recognised recoveries related to Ukraine’s conflict of $614 million, primarily consisting of cash insurance settlement proceeds received from four Russian airlines and their Russian insurers.

This was in settlement of its insurance claims in respect of 50 aircraft and five spare engines on lease to these airlines at the time of Russia’s invasion of Ukraine in February, 2022.

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AerCap is the global leader in aviation leasing with about 300 customers around the world. It is based in Dublin with offices in Shannon, Miami, Singapore, Amsterdam, Shanghai, Dubai, Seattle, Toulouse, and other locations around the world.

The company said its board approved a new share repurchase programme authorising total repurchases of up to $500 million of ordinary shares through September 30th, 2024.

In terms of outlook, AerCap is expecting total revenue of $7.2 billion in 2024 and adjusted net income of $1.6 billion.

Its effective tax rate for the full year 2023 was 8.9 per cent, compared with an effective tax rate of 16.4 per cent for the full year 2022.

Chief executive Aengus Kelly said it was “another record quarter for AerCap, completing a record year for our company across many fronts”.

“These results reflect the continued strong operating environment across our businesses and the positive momentum for leasing and sales of aircraft, engines and helicopters,” he said.

“In addition, this quarter we collected $600 million of insurance settlements, for a total of $1.3 billion collected during 2023. This strong performance is a testament to the talent, dedication and commitment of the entire AerCap team and our industry leadership.

“Given the strong tailwinds that we see for demand for aircraft, engines and helicopters, we are confident about the outlook for AerCap in 2024 and beyond.”

Dublin-based Macquarie AirFinance, meanwhile, has agreed to acquire an additional portfolio of 23 aircraft from ALAFCO Aviation Lease and Finance Company for $1.1 billion.

The portfolio consists of predominantly new technology commercial passenger aircraft with an average age of approximately five years. The portfolio is leased to 10 airlines located in nine countries.

Separately, Aer Lingus has launched its 2024 aircraft engineer apprentice programme, offering 10 places. Applicants who complete the programme will be fully qualified to begin a career with the airline’s maintenance and engineering team.

Colin Gleeson

Colin Gleeson

Colin Gleeson is an Irish Times reporter

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