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Tony Perazzo
Chief Financial Officer
(650) 340-1888

AeroCentury Corp. Reports Third Quarter 2019 Results

BURLINGAME, California, November 14, 2019 -- AeroCentury Corp. ("AeroCentury" or the "Company") (NYSE American: ACY), an independent aircraft leasing company, today reported a third quarter 2019 net loss of $8.2 million, or $(5.32) per share, compared to a net loss of $4.5 million, or $(3.16) per share, for the third quarter of 2018. In the first nine months of 2019, the Company reported a net loss of $9.6 million, or $(6.22) per share, compared to net loss of $4.2 million, or $(3.00) per share, in the first nine months of 2018.

Third quarter and year-to-date 2019 results reflect the combined operations of AeroCentury and its subsidiary, JetFleet Holding Corp. ("JetFleet"), which was acquired by the Company on October 1, 2018.

The third quarter 2019 termination of the leases for and repossession of four aircraft from one of the Company’s lessees had a substantial impact on the Company’s results. As a result of those events, the Company recognized maintenance reserves revenue of $17.0 million with respect to the four aircraft. The Company also recorded impairment losses for the four aircraft of $22.3 million, based on appraised values for three of the aircraft and expected sales proceeds for the fourth aircraft. Two of the repossessed aircraft were reclassified to held for sale during the third quarter. During the third quarter, the Company also recorded impairment losses totaling $1.0 million for two other assets that are held for sale, based on expected sales proceeds.

The nine months ended September 30, 2019 also included $1.6 million of impairment losses, based on appraised values or expected sales proceeds, for two older turboprop aircraft and a spare engine. One aircraft and the engine were sold during the third quarter and one aircraft is on a short-term operating lease.

The results for the third quarter and first nine months of 2019 included a $3.9 million bad debt allowance related to three of the Company’s aircraft that are leased pursuant to finance leases. Results for the third quarter and first nine months of 2019 also included $3,700 and $455,100, respectively, of non-cash charges related to interest rate swaps the Company entered into during the first quarter of 2019.

The quarter and nine months ended September 30, 2018 included $2.7 million and $3.0 million, respectively, of asset impairments on four of the Company’s assets held for sale, three of which were subsequently sold. The first nine months of 2018 also included $1.6 million of maintenance reserves revenue resulting from payments received from a lessee that returned three leased aircraft to the Company in 2017.

Third Quarter 2019 Highlights and Comparative Data

Aircraft and Engine Portfolio

AeroCentury’s portfolio currently consists of twenty aircraft, spread over nine different aircraft types. Thirteen of the aircraft, comprised of eleven regional jets and two turboprops, are held for lease. Three additional regional jets and four turboprops are held under sales-type or direct finance leases. The Company also has four turboprop aircraft and two regional jet aircraft that are held for sale, two of which are being sold in parts. The current customer base comprises nine customers operating in seven countries.

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About AeroCentury: AeroCentury is an independent 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.