Acting President and Chief Financial Officer
FOR IMMEDIATE RELEASE
(BURLINGAME, CA), March 7, 2017 — AeroCentury Corp. (NYSE MKT: ACY), an independent aircraft leasing company, today reported 2016 earnings were $1.2 million, or $0.78 per diluted share. In 2015, earnings were $6.4 million, or $4.17 per diluted share.
"AeroCentury made investments in leased assets totaling $69 million in the third quarter of 2016, the impact of which we are now seeing in the form of increasing operating lease revenue," said Michael G. Magnusson, Chief Executive Officer. Operating lease revenue in the fourth quarter of 2016 was $7.4 million, reflecting an increase of 22% compared to operating lease revenue in the third quarter of 2016 of $6.1 million and an increase of 20%, compared to the fourth quarter of 2015 of $6.2 million.
In the fourth quarter of 2016, AeroCentury recorded a loss of $40,000, or $0.03 per share, reflecting a $906,000 impairment charge. There was an atypical tax rate due to differences in the book and tax treatment of certain items. In the third quarter of 2016, earnings were $530,000, or $0.34 per diluted share, which included $1.2 million in gains from sales-type finance leases. In the fourth quarter of 2015, earnings were $3.1 million, or $1.99 per diluted share, which included $6.3 million in gains on disposal of assets.
"In 2016, we continued to rebuild and refresh our portfolio of leased regional aircraft," Magnusson continued. "Our strategy is to grow the size of the portfolio, but also to improve the overall quality of the assets that comprise the portfolio by adding newer more fuel efficient models. We continue to see great competition among buyers for the purchase of the type of assets that we seek to acquire." While AeroCentury did not purchase any aircraft in the fourth quarter of 2016, over the course of 2016, AeroCentury added four regional jet aircraft, and sold four older regional jet aircraft and one aircraft engine for cash, and sold three older turboprop aircraft pursuant to sales-type finance leases. Toni M. Perazzo, Chief Financial Officer noted, "The four regional jet aircraft acquired in 2016 consisted of two Bombardier CRJ-1000 regional jet aircraft on lease to Air Nostrum and two Bombardier CJR-900 aircraft on lease with Adria Airways. These acquisitions resulted in a 24% increase in the net book value of our aggregate asset portfolio, to $192.8 million from $155.3 million a year ago."
2016 Highlights (at or for the periods ended December 31, 2016, September 30, 2016, and December 31, 2015):
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AeroCentury is a global aircraft operating lessor and finance company specializing in leasing regional jet and turboprop aircraft and related engines. The Company's aircraft and engines are leased to regional airlines and commercial users worldwide.
This press release contains certain statements that may include "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including the Company’s statements regarding its strategy to sell older aircraft and focus on acquisition of larger, mid-life regional jets and new generation turboprops. All statements, other than statements of historical fact, included herein are "forward-looking statements." Although the Company believes that the expectations reflected in these forwardlooking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including the availability of appropriate aircraft for acquisition and financing therefor; the risks of reduced demand for leased aircraft of the types in the Company’s portfolio; the inability of the Company to lease certain of its aircraft; or the business failure of one or more of the Company’s lessees; as well as those discussed in the Company's reports that are filed with the Securities and Exchange Commission. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Other than as required by law, the Company does not assume a duty to update any forward-looking statement.