AerSale Reports Fourth Quarter and Full Year 2021 Results
AerSale Corporation (NASDAQ: ASLE) reported a significant revenue growth of 62.9% year-over-year, reaching $340.4 million in 2021. The company achieved a GAAP net income of $36.1 million, or 10.6% of sales, while adjusted net income was $63.6 million, or 18.7% of sales. Revenue for Q4 2021 was $116.8 million, up from $49.4 million in Q4 2020. AerSale plans to monetize 15 Boeing 757s over 2022 and 2023, anticipating total revenue between $420-$450 million for 2022. The company also reported an adjusted EBITDA of $89.3 million, or 26.2% of sales for the year.
- Revenue growth of 62.9% year-over-year to $340.4 million for 2021.
- GAAP net income of $36.1 million, representing 10.6% of sales.
- Adjusted EBITDA of $89.3 million, or 26.2% of sales, reflecting a 73.2% year-over-year increase.
- Plans to monetize 15 Boeing 757 aircraft, capitalizing on growing freighter markets.
- Cash flow from operating activities was strong at $79.1 million.
- Lower revenue from maintenance, repair, and overhaul (MRO) activities at Goodyear facility.
- Technical Operations revenue declined by 27.5% due to resource reallocation.
2021 Highlights
-
Full year 2021 revenue of
, up$340.4 million 62.9% year-over-year. -
Full year 2021 GAAP net income of
, or$36.1 million 10.6% of sales. -
Full Year 2021 Adjusted Net Income of
, or$63.6 million 18.7% of sales. -
Adjusted EBITDA of
or$89.3 million 26.2% of sales for full year 2021, up73.2% year-over-year. - Flight equipment sales included nine aircraft, two airframes, and ten engines during 2021.
- Expect opportunities to monetize 15 Boeing 757s in 2022 and 2023 as freighter markets continue to grow with the majority expected to be monetized in 2022.
-
Provides 2022 guidance: expects revenue in the range of
-$420 and adjusted EBITDA in the range of$450 million -$80 .$90 million
The Company reported fourth quarter 2021 revenue of
The improvement in Asset Management Solutions (AMS) revenue during the fourth quarter of 2021 was partially offset by lower revenue from maintenance, repair and overhaul (MRO) activities at AerSale’s Goodyear facility within TechOps, following a reallocation of resources to the Company’s cargo conversion line for its Boeing 757 aircraft. The impact from the reallocation of resources was partially offset by strong maintenance related activities, which benefitted from the overall recovery in the commercial aerospace end markets.
Fourth quarter 2021 GAAP net income was
Diluted earnings per share was
Fourth quarter 2021 adjusted EBITDA was
With the impact of the Omicron variant receding and major economies removing restrictions related to COVID-19,
Cash flows from operating activities were
Finazzo concluded, “We also redeemed all of our outstanding public warrants at the end of the year in a cashless redemption, further strengthening our financial profile and positioning us to take advantage of upcoming organic and inorganic opportunities.”
Fourth Quarter 2021 Results of Operations
AMS revenue increased by
Revenue from our Technical Operations (“TechOps”) segment was down
Gross margin was
Selling, general and administrative expenses were
Income from operations was
Income tax expense was
GAAP net income was
Diluted earnings per share was
Adjusted EBITDA in the fourth quarter of 2021 was
Full Year 2021 Results of Operations
For the full year 2021,
AMS revenue was
Revenue from TechOps was
Gross margin was
Selling, general and administrative expenses, net of the Payroll Support Program proceeds, were
Income from operations was
Income tax expense was
GAAP net income was
Adjusted EBITDA for 2021 was
2022 Guidance
Further, this outlook is based on an improvement in the Company’s AMS segment, ongoing demand for its on-airport MRO services, accelerating demand in cargo and E-Commerce markets, and continued requests for passenger-to-freighter conversions and other TechOps products and services.
The ongoing and continued monetization of the Boeing 757 fleet acquisition is expected to be the predominant driver of the AMS segment.
Conference Call Information
The Company will host a conference call today,
A telephonic replay will be available shortly after the conclusion of the call and until
Non-GAAP Financial Measures
This press release includes non-GAAP financial measures, including adjusted EBITDA, adjusted Net Income, and adjusted diluted Earnings per Share.
You should review AerSale’s audited financial statements, and not rely on any single financial measure to evaluate AerSale’s business. Other companies may calculate adjusted EBITDA, adjusted Net Income, or Adjusted diluted earnings per share differently, and therefore AerSale’s adjusted EBITDA, adjusted Net Income, or adjusted diluted earnings per share measures may not be directly comparable to similarly titled measures of other companies.
Reconciliations of Net Income, the Company’s closest GAAP measure, to adjusted EBITDA, adjusted Net Income, and adjusted diluted Earnings per Share, are outlined in the tables below following the Company’s consolidated financial statements. A reconciliation of non-GAAP adjusted EBITDA guidance to net income, the most directly comparable GAAP measure, has not been provided due to the lack of predictability regarding the various reconciling items such as the provision for income taxes and depreciation and amortization, which are expected to have a material impact on these measures and cannot be reasonably predicted without unreasonable efforts.
Fourth Quarter and Full Year 2021 Financial Results
|
||||||
|
||||||
CONSOLIDATED BALANCE SHEET |
||||||
(in thousands, except per share data) |
||||||
|
|
|
|
|
||
|
|
2021 |
|
2020 |
||
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
130,188 |
|
$ |
29,317 |
Accounts receivable, net of allowance for doubtful accounts of |
|
|
42,571 |
|
|
50,215 |
Inventory: |
|
|
|
|
|
|
Aircraft, airframes, engines, and parts, net |
|
|
81,759 |
|
|
85,192 |
Advance vendor payments |
|
|
14,287 |
|
|
6,205 |
Due from related party |
|
|
- |
|
|
474 |
Deposits, prepaid expenses, and other current assets |
|
|
2,724 |
|
|
7,560 |
Total current assets |
|
|
271,529 |
|
|
178,963 |
Fixed assets: |
|
|
|
|
|
|
Aircraft and engines held for lease, net |
|
|
73,364 |
|
|
86,844 |
Property and equipment, net |
|
|
7,350 |
|
|
7,839 |
Inventory: |
|
|
|
|
|
|
Aircraft, airframes, engines, and parts, net |
|
|
77,534 |
|
|
55,463 |
Deferred income taxes |
|
|
10,013 |
|
|
5,708 |
Deferred financing costs, net |
|
|
999 |
|
|
367 |
Deferred customer incentives and other assets, net |
|
|
598 |
|
|
271 |
Due from related party |
|
|
- |
|
|
5,450 |
|
|
|
19,860 |
|
|
19,860 |
Other intangible assets, net |
|
|
26,238 |
|
|
28,364 |
Total assets |
|
$ |
487,485 |
|
$ |
389,129 |
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
Accounts payable |
|
$ |
19,967 |
|
$ |
16,364 |
Accrued expenses |
|
|
8,424 |
|
|
8,576 |
Income tax payable |
|
|
3,443 |
|
|
1,324 |
Lessee and customer purchase deposits |
|
|
33,212 |
|
|
2,820 |
Deferred revenue |
|
|
2,860 |
|
|
2,595 |
Total current liabilities |
|
|
67,906 |
|
|
31,679 |
|
|
|
|
|
|
|
Long-term lease deposits |
|
|
2,053 |
|
|
1,145 |
Maintenance deposit payments and other liabilities |
|
|
3,403 |
|
|
3,664 |
Deferred income taxes, net |
|
|
1,113 |
|
|
— |
Warrant liability |
|
|
4,131 |
|
|
1,186 |
Total liabilities |
|
|
78,606 |
|
|
37,674 |
Commitments and contingencies |
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
|
Common stock, |
|
|
5 |
|
|
4 |
Additional paid-in capital |
|
|
313,901 |
|
|
292,593 |
Retained earnings |
|
|
94,973 |
|
|
58,858 |
Total equity |
|
|
408,879 |
|
|
351,455 |
Total liabilities and stockholders’ equity |
|
$ |
487,485 |
|
$ |
389,129 |
|
|||||||||||||
|
|||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||||
(in thousands, except per share data) |
|||||||||||||
(Unaudited) |
|||||||||||||
Three Months Ended |
|
Twelve Months Ended |
|||||||||||
2021 |
2020 |
|
2021 |
2020 |
|||||||||
Revenue: |
|||||||||||||
Products |
$ |
84,967 |
|
$ |
11,664 |
|
$ |
209,881 |
|
$ |
49,390 |
|
|
Leasing |
|
10,033 |
|
|
8,012 |
|
|
30,657 |
|
|
55,649 |
|
|
Services |
|
21,783 |
|
|
29,706 |
|
|
99,899 |
|
|
103,899 |
|
|
Total revenue |
|
116,783 |
|
|
49,382 |
|
|
340,437 |
|
|
208,938 |
|
|
Cost of sales and operating expenses: |
|||||||||||||
Cost of products |
|
54,328 |
|
|
8,683 |
|
|
139,475 |
|
|
49,890 |
|
|
Cost of leasing |
|
2,137 |
|
|
2,928 |
|
|
9,804 |
|
|
24,244 |
|
|
Cost of services |
|
16,131 |
|
|
24,646 |
|
|
71,766 |
|
|
82,015 |
|
|
Total cost of sales |
|
72,596 |
|
|
36,257 |
|
|
221,045 |
|
|
156,149 |
|
|
Gross profit |
|
44,187 |
|
|
13,125 |
|
|
119,392 |
|
|
52,789 |
|
|
Selling, general, and administrative expenses |
|
24,419 |
|
|
15,021 |
|
|
77,498 |
|
|
55,635 |
|
|
Payroll support program proceeds |
|
- |
|
|
- |
|
|
(14,768 |
) |
|
(12,693 |
) |
|
Transaction costs incurred |
|
- |
|
|
(1,869 |
) |
|
- |
|
|
(1,436 |
) |
|
Income from operations |
|
19,768 |
|
|
(27 |
) |
|
56,662 |
|
|
11,283 |
|
|
Other income (expenses): |
|
|
|
|
|||||||||
Interest expense, net |
|
(230 |
) |
|
(338 |
) |
|
(980 |
) |
|
(1,645 |
) |
|
Other income, net |
|
200 |
|
|
136 |
|
|
458 |
|
|
494 |
|
|
Unrealized loss on investment |
(5,421 |
) |
(5,421 |
) |
- |
|
|||||||
Change in fair value of warrant liability |
(210 |
) |
(388 |
) |
(2,945 |
) |
(388 |
) |
|||||
Total other expenses |
|
(5,661 |
) |
|
(590 |
) |
|
(8,888 |
) |
|
(1,539 |
) |
|
(Loss) income before income tax provision |
|
14,107 |
|
|
(617 |
) |
|
47,774 |
|
|
9,744 |
|
|
Income tax expense |
|
(2,922 |
) |
|
870 |
|
|
(11,659 |
) |
|
(1,650 |
) |
|
Net (loss) income |
$ |
11,185 |
|
$ |
253 |
|
$ |
36,115 |
|
$ |
8,094 |
|
|
(Loss) earnings per share - basic |
$ |
0.24 |
|
$ |
0.06 |
|
$ |
0.84 |
|
$ |
7.85 |
|
|
(Loss) earnings per share - diluted |
$ |
0.21 |
|
$ |
0.06 |
|
$ |
0.76 |
|
$ |
7.39 |
|
||||||||
|
||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
(in thousands) |
||||||||
(Unaudited) |
||||||||
|
|
Years ended |
||||||
|
|
2021 |
|
2020 |
||||
Cash flows from operating activities: |
|
|
|
|
||||
Net income |
$ |
36,115 |
|
$ |
8,094 |
|
||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: |
|
|
|
|
||||
Depreciation and amortization |
|
12,998 |
|
|
24,223 |
|
||
Amortization of debt issuance costs |
|
494 |
|
|
740 |
|
||
Inventory reserve |
|
6,942 |
|
|
13,651 |
|
||
Impairment of aircraft held for lease |
|
- |
|
|
3,036 |
|
||
Provision for doubtful accounts |
|
212 |
|
|
212 |
|
||
Deferred income taxes |
|
(3,192 |
) |
|
22 |
|
||
Change in fair value of warrant liability |
|
2,945 |
|
|
388 |
|
||
Stock-based compensation |
|
12,721 |
|
|
1,042 |
|
||
Unrealized loss on investment |
|
5,421 |
|
|
- |
|
||
Changes in operating assets and liabilities, net of acquisition: |
|
|
|
|
||||
Accounts receivable |
|
3,868 |
|
|
(2,587 |
) |
||
Inventory |
|
(35,672 |
) |
|
(55,275 |
) |
||
Deposits, prepaid expenses, and other current assets |
|
5,475 |
|
|
3,374 |
|
||
Deferred customer incentives and other assets |
|
(333 |
) |
|
56 |
|
||
Advance vendor payments |
|
(8,090 |
) |
|
(2,958 |
) |
||
Accounts payable |
|
3,603 |
|
|
(801 |
) |
||
Income tax payable |
|
2,157 |
|
|
1,324 |
|
||
Accrued expenses |
|
(1,280 |
) |
|
(1,697 |
) |
||
Deferred revenue |
|
265 |
|
|
(5,894 |
) |
||
Lessee and customer purchase deposits |
|
34,690 |
|
|
1,776 |
|
||
Other liabilities |
|
(260 |
) |
|
(957 |
) |
||
Net cash provided by (used in) operating activities |
|
79,079 |
|
|
(12,231 |
) |
||
Cash flows from investing activities: |
|
|
|
|
||||
Business acquisition |
|
- |
|
|
(16,976 |
) |
||
Proceeds from sale of assets |
|
17,095 |
|
|
3,100 |
|
||
Acquisition of aircraft and engines held for lease, including capitalized cost |
|
(2,383 |
) |
|
(5,128 |
) |
||
Purchase of property and equipment |
|
(1,508 |
) |
|
(2,137 |
) |
||
Net cash provided by (used in) investing activities |
|
13,204 |
|
|
(21,141 |
) |
||
Cash flows from financing activities: |
|
|
|
|
||||
Repayments of |
|
- |
|
|
(3,424 |
) |
||
Proceeds from Revolving Credit Facility |
|
- |
|
|
96,726 |
|
||
Repayments of Revolving Credit Facility |
|
- |
|
|
(96,726 |
) |
||
Cash paid for employee taxes on withholding shares |
|
(694 |
) |
|
- |
|
||
Proceeds from exercise of warrants |
|
9,282 |
|
|
- |
|
||
Proceeds from Merger |
|
- |
|
|
48,608 |
|
||
Net cash provided by (used in) financing activities |
|
8,588 |
|
|
45,184 |
|
||
|
|
|
|
|
||||
Cash flows from discontinued operations: |
|
|
|
|
||||
Net cash provided by operating activities |
|
- |
|
|
- |
|
||
Net cash provided by discontinued operations |
|
- |
|
|
- |
|
||
Increase (decrease) in cash and cash equivalents |
|
100,871 |
|
|
11,812 |
|
||
Cash and cash equivalents, beginning of period |
|
29,317 |
|
|
17,505 |
|
||
Cash and cash equivalents, end of period |
$ |
130,188 |
|
$ |
29,317 |
|
||
|
|
|
|
|
||||
Supplemental disclosure of cash activities |
|
|
|
|
||||
Income taxes |
|
8,340 |
|
|
2,650 |
|
||
Interest |
|
595 |
|
|
855 |
|
||
Supplemental disclosure of noncash investing activities |
|
|
|
|
||||
Reclassification of aircraft and aircraft engines inventory to (from) equipment held for lease, net |
|
(7,002 |
) |
|
6,228 |
|
||
Reclassification of due from related party to deposits, prepaid expenses and other current assets |
|
5,421 |
|
|
- |
|
|
|||||||||||||||
Adjusted EBITDA, Net Income and Diluted EPS Reconciliation Table (In ‘000s) |
|||||||||||||||
(Unaudited) |
|||||||||||||||
Three months ended |
Twelve months ended |
||||||||||||||
2021 |
% of
|
2020 |
% of
|
2021 |
% of
|
2020 |
% of
|
||||||||
Reported Net Income/(Loss) |
11,185 |
9.6 |
% |
253 |
|
0.5 |
% |
36,115 |
10.6 |
% |
8,094 |
|
3.9 |
% |
|
Addbacks: |
|||||||||||||||
Inventory Write-Off |
1,640 |
1.4 |
% |
- |
|
0.0 |
% |
6,416 |
1.9 |
% |
15,924 |
|
7.6 |
% |
|
Loss on Investment |
5,421 |
4.6 |
% |
- |
|
0.0 |
% |
5,421 |
1.6 |
% |
- |
|
0.0 |
% |
|
Change in FV of Warrant Liability |
210 |
0.2 |
% |
388 |
|
0.8 |
% |
2,945 |
0.9 |
% |
388 |
|
0.2 |
% |
|
Stock Compensation |
3,822 |
3.3 |
% |
1,042 |
|
2.1 |
% |
12,721 |
3.7 |
% |
1,042 |
|
0.5 |
% |
|
Transaction Costs |
- |
0.0 |
% |
(1,869 |
) |
(3.8 |
%) |
- |
0.0 |
% |
(1,436 |
) |
(0.7 |
%) |
|
Adjusted Net Income (loss) |
22,278 |
19.1 |
% |
(186 |
) |
-0.4 |
% |
63,618 |
18.7 |
% |
24,012 |
|
11.5 |
% |
|
Interest Expense |
230 |
0.2 |
% |
338 |
|
0.7 |
% |
980 |
0.3 |
% |
1,645 |
|
0.8 |
% |
|
Income Tax Expense (Benefit) |
2,922 |
2.5 |
% |
(870 |
) |
(1.8 |
%) |
11,659 |
3.4 |
% |
1,650 |
|
0.8 |
% |
|
Depreciation and Amortization |
3,130 |
2.7 |
% |
3,710 |
|
7.5 |
% |
12,998 |
3.8 |
% |
24,223 |
|
11.6 |
% |
|
Adjusted EBITDA |
28,560 |
24.5 |
% |
2,992 |
|
6.1 |
% |
89,255 |
26.2 |
% |
51,530 |
|
24.7 |
% |
|
Reported Diluted EPS |
0.21 |
0.06 |
|
0.76 |
7.39 |
|
|||||||||
Addbacks: |
|||||||||||||||
Inventory Write-Off |
0.03 |
- |
|
0.14 |
14.54 |
|
|||||||||
Loss on |
0.11 |
- |
|
||||||||||||
Change in FV of warrant liability |
0.00 |
0.09 |
|
0.06 |
0.35 |
|
|||||||||
Stock-based compensation |
0.07 |
0.24 |
|
0.27 |
0.95 |
|
|||||||||
Transaction Costs |
- |
(0.44 |
) |
- |
(1.31 |
) |
|||||||||
Adjusted Diluted EPS |
0.31 |
(0.05 |
) |
1.34 |
21.92 |
|
Forward Looking Statements
This press release includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including without limitation statements regarding our anticipated financial performance, including all statements set forth in the “2022 Guidance” section above; our growth trajectory; the impact of investments in our Boeing 757 program on our financial performance; our ability to sell our aircraft on the timelines we anticipate; the expected operating capacity of our MRO facilities and demand for such services; expectations of market recovery and recommissioning of aircraft; the expected commencement date of sales of our AerAware product; and our anticipated revenue split between our two segments. AerSale’s actual results may differ from their expectations, estimates and projections and consequently, you should not rely on these forward-looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “continue,” and similar expressions are intended to identify such forward-looking statements. Many factors could cause actual future events to differ materially from the forward-looking statements in this presentation, including without limitation, the impact of the COVID-19 pandemic; factors adversely impacting the commercial aviation industry; events related to the war in
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FAQ
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