FTAI Aviation Ltd.

Thank you for standing by and welcome to FTAI Aviation's first quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. To remove yourself from the queue, you may press star 1-1 again. I would now like to hand the call over to Alan Andrini, Investor Relations. Please Go ahead.

Thank you, Lateef. I would like to welcome you all to the FTIA Aviation First Quarter 2025 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. 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 GAAP 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-GAAP financial measures and forward-looking statements, and to review the risk factors contained in our quarterly report filed with the SEC. Now, I would like to turn the call over to Joe.

Thank you, Alan. I'm pleased to announce our 40th dividend as a public company and our 55th consecutive dividend since inception. The dividend of $0.30 per share will be paid on May 23rd based on a shareholder record date of May 16. Angela is going to take you through the numbers in more detail, but before that, I wanted to highlight a few things. We started the year with momentum, recording another strong quarter in aerospace products with $131 million in adjusted EBITDA at a margin of 36%. With a consistently growing backlog of purchase orders for 2025 and beyond, demand for our aerospace products and services continues to accelerate, strengthening our position as a leader in the engine maintenance aftermarket. Turning to production, we refurbished 138 CFM56 modules this quarter between our two facilities in Montreal and Miami. We anticipate a significant ramp to occur in Q2, particularly in Montreal, as we execute on our growth initiatives and operational throughput to enhance efficiency. As we expand production of refurbished modules and engines, our core focus is to increase our market share of restorations beyond the current 5% to 25%. Now let's talk about adjusted free cash flow. In the first quarter, we closed on approximately 234 million of aviation equipment at attractive prices as replacement CapEx for the seed portfolio of aircraft which are being sold to Strategic Capital Initiative or SCI. The transition of these aircraft started in Q1 where we sold four aircraft for 59 million and we are proceeding on plan to have completed the sale of the remaining assets by the end of Q2 generating a significant inflow of approximately $440 million. We expect adjusted free cash flow to be in the range of $300 to $350 million for the first half of the year, which is in line with our target to achieve $650 million in adjusted free cash flow for all of 2025. For the Strategic Capital Initiative, or SCI, it was great to announce one investment management as an equity investor to the partnership. Since then, we have secured an additional equity partner and expect further closings in Q3 of this year. We remain on track to deploy 4 billion plus in capital by the end of the year through a combination of these commitments and our 2.5 billion secured asset level financing facility with Atlas, a wholly owned affiliate of Apollo and Deutsche Bank. Finally, we've been working extensively on operational plans with our partner IAG Engine Center Europe in Rome and are confident we can ramp up production immediately following the acquisition to support our regional customer base in Europe and the Middle East. We already have five engines in the facility and expect to close the new joint venture very soon. Therefore, overall, we feel increasingly confident in our business segment EBITDA 2025 goal of between 1.1 to 1.15 billion, excluding corporate and other, rising to approximately 1.4 billion in 2026. While tariffs create some challenges and opportunities, we do not currently see tariffs having any material negative effect on our business, and we are reiterating our guidance for both 2025 and 2026 as we continue to see growing and accelerating demand for our proprietary set of aerospace products. With that, I'll hand it over to Angela to talk through the numbers.