Air Lease Corporation Records Impressive Growth Despite Volatile Market

LONDON – Aircraft leasing giant, Air Lease Corporation, has recorded a 25.7% revenue jump in the first quarter of 2022.

The company is feeling a positive uptick and confirms that aviation is finally recovering from the pandemic.

There are currently 27 aircraft on contract with Russian Airlines in Russia with ALC, and the company seems to have given up attempts to recover the aircraft amidst the Russian re-writing of registration laws.

Despite the catastrophic effect of the Russian invasion of Ukraine, Air Lease Cooperation (ALC) is riding the storm rather smoothly.

The 27 aircraft ‘lost’ in Russia account for 3.4% of the ALC’s entire leased fleet, which is not a significant amount of money wasted. Nevertheless, ALC is still pressing the captured aircraft for remaining insurance claims valued at $802.4 million.

ALC’s Chief Executive Officer, John L. Plueger said: “Industry fundamentals continue to strengthen globally – demand is expanding both for new and young used aircraft, supporting continued firming of lease rates and bolstering the value of the existing aircraft in our fleet.”

“We benefited from this improving backdrop during the first quarter. While we wrote off our Russia exposure, we are vigorously pursuing our insurance coverage and believe we have strong and valid claims.”

ALC has a good reason to look ahead into the future as they have recorded a revenue rise. The company’s total revenues for the first quarter increased by 25.7% to $596.7 million, due to ALC’s increase in its fleet portfolio.

ALC added eight aircraft from its books, and one pre-owned aircraft totaling approximately $490 million in investments.

By the end of the 1st quarter of this year, the number of ALC’s owned aircraft is 370 aircraft with a net value of $22.3 billion. Of these 370 aircraft, 268 are narrowbody aircraft and 102 are widebodies.

The average leasing period is at 7 years long with an average aircraft age at 4 and a half years.

Executive Chairman of the Board, Steven F. Udvar-Házy, noted that: “With the strengthening market, we are monitoring continued delivery delays from Boeing and Airbus very closely, and will adjust accordingly to take advantage of market opportunities – fostering fleet growth in 2022 and beyond.”

“ALC is well-poised to execute successfully on our strategy as the recovery continues. We are also pleased to report that we have fully completed our $150 million common stock repurchase program.”

All in all, the ALCs portfolio is increasing and is resilient against external shocks, such as the war a spat with the Russian aircraft, and the increase in oil price.

It looks like airlines are opting for better financial advisory services, such as ALC to (re)negotiate terms and contracts with manufacturers. This is a crucial asset in a post-covid recovery phenomenon, where airlines are repositioning themselves.

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