Aengus Kelly, Chief Executive Officer of AerCap, said, "The first quarter of 2021 was an exceptional one for AerCap, as we announced plans to acquire GECAS from GE, a transaction that we believe will create significant long-term value for our shareholders. At the same time, we continued to focus on our business and we are pleased to report a significant increase in our leasing activity. During the quarter, AerCap signed 60 lease agreements with airlines in 15 countries, the highest demand we have seen in 18 months. We believe this progress reflects the growing confidence of our airline customers as they plan for the future. While parts of the world remain under governmental restrictions, it is clear that there is significant pent-up consumer demand for air travel. As the vaccine rollout progresses, AerCap's global fleet of in-demand new technology aircraft will enable us to support our customers as the recovery in air travel continues."
Net income for the first quarter of 2021 was $228 million, or $1.76 per share. This was primarily impacted by $100 million of cash accounting and $25 million of GECAS transaction-related expenses, pre-tax. This compares to net income of $277 million, or earnings per share of $2.14, for the same period in 2020.Excluding GECAS transaction-related expenses, net income for the first quarter of 2021 was $250 million, or $1.93 per share.
Highlights:
Signed lease agreements for 60 aircraft, including 28 widebody aircraft, in the first quarter of 2021.
Completed the offering of $1 billion of 5-year senior unsecured notes with a 1.75% coupon.
Announced entry into a definitive agreement to acquire GE Capital Aviation Services.
Closed a $19 billion bridge facility and $5 billion term loan agreement associated with the GECAS transaction with a consortium of 20 banks.
Entered into a new $4.35 billion revolving credit facility subject to the closing of the GECAS transaction, increasing our total revolving credit facilities to $9 billion post-closing.
Attractive Aircraft Fleet:
AerCap has placed 100% of its new aircraft deliveries from its order book through 2022.
New technology aircraft comprise 63% of AerCap's fleet. The average age of the company's owned fleet was 6.6 years as of March 31, 2021 and the average remaining contracted lease term was 7.3 years.
The fleet utilization rate for the first quarter of 2021 was 96%, and only 7% of the company's aircraft by book value are scheduled to come off lease through the end of 2022.
Strong Balance Sheet:
AerCap ended the first quarter with $8.6 billion in total sources of liquidity, representing next 12 months' sources-to-uses coverage ratio of 1.7x.
Adjusted debt/equity ratio of 2.5 to 1, below the company's target of 2.7x to 1.
Secured debt-to-total assets ratio of 24%.
Revenue and Net Spread
Basic lease rents were $889 million for the first quarter of 2021, compared with $1,031 million for the same period in 2020. The decrease was primarily due to lease restructurings, transitions and the impact of airline bankruptcies.
Maintenance rents and other receipts were $183 million for the first quarter of 2021, compared with $134 million for the same period in 2020. The increase was primarily due to higher maintenance revenue recognized as a result of lease terminations during the first quarter of 2021.
Net gain on sale of assets for the first quarter of 2021 was $5 million, relating to nine aircraft sold for $184 million, compared with $58 million for the same period in 2020, relating to 12 aircraft sold for $265 million. The decrease was primarily due to the lower volume and composition of asset sales.
Other income for the first quarter of 2021 was $19 million, compared with $15 million for the same period in 2020. The increase was primarily driven by higher interest income.
Aircraft Portfolio
As of March 31, 2021, AerCap's portfolio consisted of 1,321 aircraft that were owned, on order or managed. The average age of the company's owned fleet as of March 31, 2021 was 6.6 years (3.2 years for new technology aircraft, 12.3 years for current technology aircraft) and the average remaining contracted lease term was 7.3 years.
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