AeroCentury, an independent aircraft leasing company, has reported a first-quarter 2020 net loss of US$10.2 million, compared to a net loss of US$1.3 million for the first-quarter of 2019.
Results for the quarter ended March 31, 2020 included impairment losses totaling US$6.7 million, arising from revised estimated sales proceeds for three regional jet aircraft and an older turboprop aircraft that is being sold in parts. Results also included a US$1.2 million bad debt allowance related to two of the company’s aircraft that are subject to finance leases and a US$1.9 million non-cash charge related to the company’s interest rate swaps, which is included in interest expense.
The results for the first quarter ended March 31, 2019 included $1.4 million of impairment provisions related to the write-down of two older off-lease turboprop aircraft and a spare engine to their estimated sales values, and a non-cash charge of $0.4 million related to the company’s interest rate swaps, which was included in interest expense.
On May 1, 2020, the company and its credit facility lenders entered into a Fourth Amended and Restated Loan and Security Agreement, which converted the company’s revolving credit facility with MUFG Union Bank as Agent, into a term loan with an initial principal balance of US$83,689,900. The amendment provides for a forbearance of the existing defaults and events of default under the company’s indebtedness to at least June 29, 2020, which is the milestone for the company entry into a written agreement for a strategic transaction that would enable repayment of the MUFG indebtedness.
