FTAI Aviation Ltd.

Ladies and gentlemen, thank you for standing by. Welcome to the second quarter 2024 FTI Aviation's earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you would need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would like now to turn your conference over to Alan Andreini, Investor Relations. Please go ahead.

Thank you, Michelle. I would like to welcome you all to the FTIA Aviation Second Quarter 2024 Earnings Call. Joining me here today are Joe Adams, our Chief Executive Officer, Angela Nam, our Chief Financial Officer, and David Marino, our Chief Operating Officer. We have posted an investor presentation and our press release on our website, which we encourage you to download if you have not already done so. Also, please note that this call is open to the public in listen-only mode and is being webcast. In addition, we will be discussing some non-GAAP financial measures during the call today, including EBITDA, the reconciliation of those measures to the most directly comparable gap measures can be found in the earnings supplement. Before I turn the call over to Joe, I would like to point out that certain statements made today will be forward-looking statements, including regarding future earnings. These statements, by their nature, are uncertain and may differ materially from actual results. We encourage you to review the disclaimers in our press release and investor presentation regarding non-gap financial measures and forward-looking statements. and to review the risk factors contained in our recorded report filed with the SEC. Now I would like to turn the call over to Joe.

Thank you, Alan. To start today, I'm pleased to announce our 37th dividend as a public company and our 52nd consecutive dividend since inception. The dividend of 30 cents per share will be paid on August 20th based on a shareholder record date of August 12th. Now let's turn to the numbers. The key metric for us is adjusted EBITDA. We continued the year strongly with adjusted EBITDA of 213.9 million in Q2 2024, which is up 30% compared to 164.1 million in Q1 of this year, and up 40% compared to 153.1 million in Q2 of 2023. During the second quarter, The 213.9 million EBITDA number was comprised of 125 million from our leasing segment, 91.2 million from our aerospace product segment, and negative 2.3 from corporate and other. Turning out a leasing, leasing had a great quarter, posting approximately 125 million of EBITDA. The pure leasing component of the 125 million came in at 112 million for Q1. For Q2, versus 98 million in Q1 of 2024. Additionally, we sold 59 million book-valued assets for a gain of 13.5 million. With exceptionally strong demand for assets and the continuation of a robust northern hemisphere summer travel season, we now expect to generate 500 million in EBITDA in 2024, which includes 50 million in gains on asset sales versus our prior estimate of $475 million. Aerospace products had yet another excellent quarter with $91.2 million of EBITDA and an overall EBITDA margin of 37%. We're seeing tremendous growth in the aerospace products business in general and feel good about raising our estimates for 2024 EBITDA in aerospace products from our prior estimate of $250 million up to $325 to $350 million. We also are experiencing expansion in aerospace products margins as demand for refurbished modules and engines remains very high while increasing efficiencies at our two CFM56 maintenance facilities in Montreal and Miami is controlling or in some cases lowering our costs. Overall, looking ahead, we now expect annual aviation EBITDA for 2024 to be between 825 to 850 million, not counting corporate and other, versus our original estimate of 675 to 725 million. And finally, about two years ago, we first outlined our corporate financial goal of generating in 2026 1 billion of EBITDA comprised of 500 million from leasing and 500 million from aerospace products. So now that we're halfway through this time period and ahead of plan, we're resetting the target. Our new goal is 1.25 billion of EBITDA in 2026, comprised of 550 million of leasing EBITDA and 700 million of aerospace products EBITDA. With that, I'll turn the call back to Alan.