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Developments

The May 19th edition of Aviation Finance is published
May 19th 2016: Aviation Finance latest issue: we speak with Stellcap's Howard Millar, and former Ryanair CFO, about its $5bn 'operating lease killer' plan; Implications of BOC Aviation's imminent IPO; Afreximbank's Samuel Mugoya on its $20bn fund to support Africa's airlines; Analysis: Aercap's portfolio; Ryanair - IAG deal could start a 'feeder' frenzy amongst European airlines; OEM Business: Fitch on Boeing; Analysis: Emirates' record financial results for y/e March 2016.


BOC Aviation IPO could pave way for other Asia lessor IPOs
The take private of Avolon by Bohai Leasing earlier in 2016, shrunk the universe of publicly listed pure play lessors back but with the upcoming IPO of BOC Aviation, the visibility and appeal of aircraft assets to investors should improve. BOC Aviation, aircraft leasing unit of Bank of China, is arranging an IPO currently, which has attracted China’s sovereign wealth fund and Boeing as anchor investors. A successful IPO on the Hong Kong Stock Exchange, set for 1st June, could also pave the way for other large Asian lessors to follow suit.

 

Perspectives

Nordic's regional jet buying spree over 'for now'

Nordic Aviation Capital's Søren Overgaard on the lessor's ambitions in the regional jet market.
Morgan on private EETCs
Aerolease's Jep Thornton on its MRJ deal
Avolon's Slattery on lessor M&As in 2016
Aviation thought leaders on the Outlook for 2016
Transportation Partners' Duffy: the airline-lessor model
Johnny Lau on the Chinese leasing market
GECAS' Norm Liu on the lessor's business model
See the Aviation Finance Perspectives Series here.

Analysis

Aercap completes 131 aircraft transactions in Q1, set to make first debt issuance of 2016
AerCap's highlights from its first quarter results include fleet utilisation rate of 99.3%; average remaining lease term of 6.1 years and a debt to equity ratio of 2.8x. In the quarter AerCap completed 131 aircraft transactions of which 36 were widebodies. The lessor has also just priced a $1 billion senior unsecured debt issuance, its first debt issuance of 2016.


Fitch assigns A rating to Boeing $1 billion note issuance
Fitch Ratings has assigned 'A' long-term ratings to Boeing Company's (BA) issuance of $1 billion senior unsecured notes. The notes will be issued in three parts, with maturities of 2023, 2026, and 2046, and the proceeds to be used for general corporate purposes. But Fitch believes the issuance could be considered a re-financing of $1 billion of notes maturing later in this year - $500 million at subsidiary Boeing Capital Corporation (BCC) in August and $500 million at Boeing Company in November. The refinancing of all debt maturities is incorporated into Fitch's ratings for Boeing Company, with the outlook 'stable'.


IATA data shows passenger traffic up 7% in Q1 - but growth rate easing
Although global passenger traffic in the first quarter of 2016 started strongly, up 7.0 per cent on the same period a year earlier, or by about 6.0 per cent after accounting for the extra leap day, the growth in March (+5.3 per cent) was the slowest growth since June last year, according to IATA.

 

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Afreximbank creates $20bn fund to support Africa's airlines
A sizeable new loan fund to help revive Africa's currency-exposed airlines has been established by the African Export-Import Bank, which is also exploring the possibility of creating a new regionally focused leasing platform. Aviation Finance reports on an address last week by Afreximbank Senior Manager, Samuel Mugoya in which he highlights some of the challenges faced by airlines on the continent and also some of the opportunities for growth, particularly in intra-regional services.

The May 5th edition of Aviation Finance is published
May 5th 2016: Aviation Finance latest issue: we speak with Citi's Tom Hollahan, Munawar Noorani and Louise O'Mara on the aircraft financing environment; New technology creating new routes - how Norwegian's plan to leverage new technology narrowbodies could shake up the transatlantic market; Analysis: the air freight market in 2016; Aircastle set up to acquire more mid life aircraft; FLY reports net income increase following accounting change; American and Norwegian set to issue EETCs; GOL's exchange offer; Avolon fleet size jumps, delivers first NEO to Indigo; Analysis: Blade downgraded.

FLY reports net income increase of more than $20 million as a result of SEC-mandated accounting policy changes
May 2nd 2016: SEC mandated changes to FLY Leasing's accounting policy for maintenance rights has seen the aircraft lessor restate its financial statements for fiscal years 2014 and 2013, and include it in its 2015 results. The changes see FLY report increased net income of $21.8 million per cent for the three years with no material impact on the company's reported cash flow for the periods covered.

 

Analysis

Avolon's fleet increases as HKAC comes under its wing
April 29th 2016: Avolon's owned, managed and committed fleet has grown to 402 aircraft following the acquisition of the lessor by China's Bohai Capital. Avolon's fleet includes the fleet of Hong Kong Aviation Capital, a leasing business of Bohai Capital, that is now managed under the Avolon brand, as well as other aviation assets. The lessor has also reported a $3 billion war chest as it look to accelerate growth in 2016 and beyond..

Delta order a major boost for Bombardier's C Series
April 28th 2016: Delta have become the first of the major US carriers to commit to Bombardier's all new technology narrowbody C Series aircraft. In addition to securing their first major carrier order in the world's largest aviation market, the order, for at least 70 aircraft (and up to 125 aircraft), sees the Canadian OEM reach its target of 300 firm orders prior to the C Series entry into service later this year. The order is also the largest in Bombardier's corporate history.

FLY Leasing net income up in Q4 2015
March 8th 2016: FLY Leasing has reported net income for Q4 2015 of $27.7 million, or $0.68 per diluted share, against a net income of $15.5 million, or $0.37 per diluted share, in the same period 2014. 'FLY has completed a major transformation and enters 2016 with a leaner, younger and more profitable fleet, and poised for intelligent growth,' said FLY's CEO Colm Barrington. During the quarter the lessor completed its $100 million share repurchase programme and approved an additional $30 million programme.


Waypoint Leasing signs Purchase and Leaseback Agreement with Bristow Group
March 1st 2016: Waypoint Leasing (Ireland) Limited, the independent global helicopter leasing company with a fleet of 120 aircraft valued at over $1.5 bn, announced that it has closed a multi-aircraft agreement with Bristow Group Inc. (“Bristow”) for the purchase and leaseback of three AgustaWestland AW139 helicopters. All three helicopters will operate offshore in crew change and limited Search and Rescue roles, on long-term contract in Guyana.


FLY Leasing closes $385 million aircraft acquisition facility
February 29th 2016: FLY Leasing has closed a $385 million blind pool aircraft acquisition facility. The facility has a three-year revolving period followed by a three-year term and will bear interest at LIBOR plus 2.00 p.c. during the revolving period. The lenders include Commonwealth Bank of Australia New York Branch, MUFG’s banking arm Bank of Tokyo-Mitsubishi UFJ Ltd., New York Life Insurance Company and National Australia Bank. Commonwealth Bank of Australia New York Branch will serve as the Administrative Agent for the facility.


Embraer rolls out the E190-E2, the first member of the second-generation E-Jet family
February 25th 2016: Embraer rolled out the E190-E2, the first member of the second-generation regional E-Jet family today. Embraer's Chief Commercial Officer John Slattery writes on Embraer's market strategy, focussing on Asian markets in the latest issue of Aviation Finance.