Mon, May 5, 9:19 PM (13 days ago)
### FTAI Aviation Ltd. (FTAI) Q1 2025 Financial Summary **Company Overview:** FTAI Aviation Ltd. specializes in the acquisition, leasing, repair, and sale of aviation equipment, primarily CFM56-5B, CFM56-7B, and V2500 aircraft engines. The company also repairs and sells refurbished aircraft engines and aftermarket components. **Financial Performance (Q1 2025 vs. Q1 2024):** - **Revenue:** Total revenue increased by $175.4 million, driven by a $176.0 million increase in Aerospace products revenue and a $15.2 million increase in lease income. - **Expenses:** Total expenses increased by $117.4 million, primarily due to a $105.9 million increase in the cost of sales and a $7.1 million increase in operating expenses. - **Net Income:** Net income increased by $62.8 million, primarily due to the changes noted above. - **Adjusted EBITDA:** Adjusted EBITDA increased by $104.5 million, reflecting the overall improvement in financial performance. **Segment Performance:** - **Aviation Leasing:** Total revenues increased by $1.7 million, driven by a $17.6 million increase in lease income and a $3.8 million increase in maintenance revenue. Total expenses decreased by $4.6 million, primarily due to a $11.9 million decrease in the cost of sales. - **Aerospace Products:** Total revenue increased by $176.0 million, primarily due to a $165.2 million increase in CFM56-5B, CFM56-7B, and V2500 engine and module sales. Total expenses increased by $119.6 million, due to increases in the cost of sales and operating expenses. - **Corporate and Other:** Total revenues decreased by $2.3 million, primarily due to the sale of two vessels within the Offshore Energy business. Total expenses increased by $2.3 million, due to increases in operating expenses and interest expense. **Liquidity and Capital Resources:** - **Cash Flow:** Net cash used in operating activities increased by $25.6 million, primarily due to changes in net working capital and gain on insurance recoveries. Net cash used in investing activities decreased by $141.6 million, primarily due to increases in proceeds from the sale of assets and return of deposits for acquisition of leasing equipment. Net cash provided by financing activities decreased by $93.4 million, primarily due to increases in redemption of preferred shares and repayment of debt. - **Debt Obligations:** As of March 31, 2025, the company had outstanding principal and interest payment obligations of $3.7 billion and $1.4 billion, respectively, with only interest payments of $248.9 million due in the next twelve months. **Strategic Initiatives:** - **Internalization of Management:** The company internalized its management function, ceasing to be externally managed and operating as an internally managed company. - **Strategic Capital Initiative:** Launched a partnership focusing on acquiring 737NG and A320ceo aircraft, allowing the company to maintain an asset-light business model while partnerships actively acquire on-lease narrowbody aircraft at scale. **Risks and Uncertainties:** - **Economic Conditions:** Uncertainty relating to macroeconomic conditions may reduce demand for assets, result in non-performance of contracts by lessees, or limit the ability to obtain additional capital. - **Geopolitical Risks:** Instability in geographies where assets are located could have a material adverse effect on business, customers, operations, and financial results. - **Market Competition:** The markets for products and services are highly competitive, which could result in significant price competition and adverse effects on business, prospects, financial condition, results of operations, and cash flows. **Future Outlook:** The company expects to maintain sufficient liquidity to satisfy cash needs, evaluate and take action to preserve adequate liquidity, and ensure business operations continue in various environments. The Strategic Capital Initiative and related partnerships will allow the company to maintain an asset-light business model while partnerships actively acquire on-lease narrowbody aircraft at scale. **Ticker:** FTAI