WLFC posts record financial results for 2023

Willis Lease Finance Corporation (WLFC) has posted annual total revenues of US$418.6 million and pre-tax income of US$67.1 million.

Lease rent revenue increased by US$50.6 million, or 31.1%, to US$213.1 million in 2023, compared to US$162.6 million in 2022, primarily reflecting an increase in the number of engines acquired and placed on lease, including growth in utilisation compared to that of the prior period.

WLFC reported maintenance reserve revenue of US$133.7 million in 2023, an increase of 60.2%, compared to US$83.4 million in 2022. Engines out on lease with “non-re-imbursable” usage fees generated US$118.3 million of short-term maintenance revenues in 2023, compared to US$47.4 million in the prior year. There was US$15.4 million of long-term maintenance revenue recognised in 2023, compared to US$36.0 million in the prior year.

As of December 31, 2023, and 2022, there were US$28.4 million and US$6.3 million, respectively, of deferred in-substance fixed payment use fees included in Unearned Revenue associated with engines on short-term leases. 2023 annual lease rent and maintenance reserve revenues represent all-time highs in the company’s 40+ year history.

WLFC’s spare parts and equipment sales decreased to US$20.4 million in 2023, compared to US$27.0 million in 2022. The decrease in spare parts sales reflects variations in the timing of sales.

Gain on sale of leased equipment was US$10.6 million in 2023, reflecting the sale of 28 engines, one airframe and other parts and equipment. Gain on sale of leased equipment was US$3.1 million in 2022, reflecting the sale of 25 engines. WLFC generated US$67.1 million of pre-tax income in 2023, compared to US$9.8 million in 2022.

The book value of lease assets directly owned or through joint ventures, inclusive of the company’s notes receivable, maintenance rights, and investments in sales-type leases, was US$2,495.4 million as of December 31, 2023. The company successfully accessed the capital markets on multiple occasions in 2023, raising US$410 million in Asset-Backed Security (ABS) financings, refinancing its credit facility, and accessing the Japanese Operating Lease with Call Option (JOLCO) market on numerous occasions.

Diluted weighted average income per common share was US$6.23 for 2023, compared to US$0.33 in 2022. Book value per diluted weighted average common share outstanding increased to US$67.73 at December 31, 2023, compared to US$64.27 at December 31, 2022. (£1.00 = US$1.28 at time of publication).