Willis Lease Finance Corporation Reports Record Second Quarter 2025 Financial Results
COCONUT CREEK, Fla., Aug. 05, 2025 (GLOBE NEWSWIRE) -- Willis Lease Finance Corporation (NASDAQ:WLFC) ("WLFC" or the "Company"), the leading lessor of commercial aircraft engines and global provider of aviation services, today announced its financial results for the second quarter ended June 30, 2025.
Second Quarter 2025 Highlights (All metrics compared to second quarter 2024, except where noted)
- Record quarterly total revenue of $195.5 million, an increase of 29.4%
- Record quarterly pre-tax income of $74.3 million
- Lease rent revenue of $72.3 million, an increase of 29.4%
- Strong maintenance reserve revenue of $50.7 million with short-term recurring maintenance reserve revenue up 9.5%
- Spare parts and equipment sales of $30.4 million, an increase of $24.2 million
- $43.0 million gain on sale of aviation consultancy business to Willis Mitsui & Company Engine Support Limited ("WMES") joint venture
- Portfolio utilization increased to 88.3% at quarter end, compared to 76.7% at year end 2024
For the three months ended June 30, 2025, total revenue was $195.5 million, up 29.4% as compared to $151.1 million for the same period in 2024. For the second quarter of 2025, core lease rent and maintenance reserve revenues were $123.0 million in the aggregate, up 4% as compared to $118.8 million for the same period in 2024. The growth was predominantly driven by core, recurring lease and maintenance revenues associated with the continued strength of the aviation marketplace, as airlines leverage the Company's leasing, parts and maintenance capabilities to avoid protracted, expensive engine shop visits.
"Quarter 2 was WLFC's strongest quarter ever," said Austin C. Willis, Chief Executive Officer of WLFC, "Even when adjusting for unique events on both the revenue and expense side, the underlying performance of the business, demonstrated by record lease revenues, increased utilization and solid recurring reserves, was exceptional."
Second Quarter 2025 Operating Results
Engines on lease with "non-reimbursable" usage fees generated $50.2 million of short-term maintenance revenues for the quarter ended June 30, 2025, compared to $45.9 million for the quarter ended June 30, 2024, an increase of $4.4 million or 9.5%. The increase reflects an increase in the number of engines on short-term lease conditions, and the systematic, contractual increase in the hourly and cyclical usage rates on our engines.
Spare parts and equipment sales increased to $30.4 million for the quarter ended June 30, 2025, compared to $6.2 million for the quarter ended June 30, 2024. Equipment sales for the three months ended June 30, 2025, were $21.1 million for the sale of one engine. There were no equipment sales for the three months ended June 30, 2024. The $3.1 million, or 49.3% quarter-over-quarter increase in spare parts sales reflects the heightened demand for surplus material as operators extend the lives of their current generation engine portfolios.
For the quarter ended June 30, 2025, the gain on sale of leased equipment was $27.6 million, reflecting the sale of 14 engines, two airframes, and other parts and equipment from the lease portfolio. During the three months ended June 30, 2024, the Company sold seven engines, eight airframes, and other parts and equipment for a net gain of $14.4 million.
The Company sold Bridgend Asset Management Limited ("BAML"), our United Kingdom aviation consultancy business, to our WMES joint venture, resulting in a gain on sale of business of approximately $43.0 million.
The book value of lease assets owned either directly or through WLFC's joint ventures, inclusive of the Company's equipment held for operating lease, maintenance rights, notes receivable, and investments in sales-type leases was $3,254.1 million as of June 30, 2025.
Balance Sheet
As of June 30, 2025, the Company's lease portfolio was $2,830.0 million, consisting of $2,606.6 million of equipment held in its operating lease portfolio, $171.8 million of notes receivable, $34.7 million of maintenance rights, and $16.8 million of investments in sales-type leases, which represented 348 engines, 15 aircraft, one marine vessel, and other leased parts and equipment. As of December 31, 2024, the Company's lease portfolio was $2,872.3 million, consisting of $2,635.9 million of equipment held in its operating lease portfolio, $183.6 million of notes receivable, $31.1 million of maintenance rights, and $21.6 million of investments in sales-type leases, which represented 354 engines, 16 aircraft, one marine vessel, and other leased parts and equipment.
Conference Call
WLFC will hold a conference call led by the executive management team today at 10:00 a.m. Eastern Time to discuss its second quarter 2025 results.
To participate in the conference call, please use the following dial-in numbers:
U.S. and Canada: +1 (800) 289-0459
International: +1 (646) 828-8082
Conference ID: 101023
A digital replay will be available two hours after the completion of the conference call. To access the replay, please visit our website at www.wlfc.global under the Investor Relations section for details.
About Willis Lease Finance Corporation
Willis Lease Finance Corporation leases large and regional spare commercial aircraft engines, auxiliary power units and aircraft to airlines, aircraft engine manufacturers and maintenance, repair and overhaul providers worldwide. These leasing activities are integrated with various end-of-life solutions for engines and aviation materials provided through Willis Aeronautical Services, Inc. Additionally, through Willis Engine Repair Center®, Jet Centre by Willis, and Willis Aviation Services Limited, the Company's service offerings include Part 145 engine maintenance, aircraft line and base maintenance, aircraft disassembly, parking and storage, airport FBO and ground and cargo handling services.
Forward-Looking Statements
Except for historical information, the matters discussed in this press release contain forward-looking statements that involve risks and uncertainties. Generally, these statements can be identified by the use of words such as "aim," "anticipate," "believe," "continue," "could," "estimate," "expect," "feel," "forecast," "intend," "may," "outlook," "plan," "potential," "predict," "project," "seek," "should," "will," "would," and similar expressions intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Do not unduly rely on forward-looking statements, which give only expectations about the future and are not guarantees. Any forward-looking statement made by the Company is based only on information currently available to the Company and speaks only as of the date on which it is made. We undertake no obligation to update them, except as may be required by law. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results may differ materially from the results discussed in forward-looking statements. Factors that might cause such a difference include, but are not limited to: the effects on the airline industry and the global economy of events such as war, terrorist activity and pandemics; changes in oil prices, rising inflation and other disruptions to world markets; trends in the airline industry and our ability to capitalize on those trends, including growth rates of markets and other economic factors, as well as the impact of new or increased tariffs; risks associated with owning and leasing jet engines and aircraft; our ability to successfully negotiate equipment purchases, sales and leases, to collect outstanding amounts due and to control costs and expenses; changes in interest rates and availability of capital, both to us and our customers; our ability to continue to meet changing customer demands; regulatory changes affecting airline operations, aircraft maintenance, accounting standards and taxes; the market value of engines and other assets in our portfolio; and risks detailed in the Company's Annual Report on Form 10-K and other continuing reports filed with the Securities and Exchange Commission.
Unaudited Condensed Consolidated Statements of Income
(In thousands, except per share data)
| Three months ended June 30, | Six months ended June 30, | ||||||||||||||||
| 2025 | 2024 | % Change | 2025 | 2024 | % Change | ||||||||||||
| REVENUE | |||||||||||||||||
| Lease rent revenue | $ | 72,268 | $ | 55,866 | 29.4 | % | $ | 140,007 | $ | 108,747 | 28.7 | % | |||||
| Maintenance reserve revenue | 50,743 | 62,897 | (19.3 | )% | 105,602 | 106,767 | (1.1 | )% | |||||||||
| Spare parts and equipment sales | 30,354 | 6,186 | 390.7 | % | 48,594 | 9,474 | 412.9 | % | |||||||||
| Interest revenue | 3,649 | 2,284 | 59.8 | % | 7,583 | 4,553 | 66.5 | % | |||||||||
| Gain on sale of leased equipment | 27,582 | 14,428 | 91.2 | % | 32,019 | 23,629 | 35.5 | % | |||||||||
| Gain on sale of financial assets | — | — | nm | 378 | — | nm | |||||||||||
| Maintenance services revenue | 8,031 | 6,781 | 18.4 | % | 13,617 | 12,008 | 13.4 | % | |||||||||
| Other revenue | 2,875 | 2,678 | 7.4 | % | 5,434 | 5,025 | 8.1 | % | |||||||||
| Total revenue | 195,502 | 151,120 | 29.4 | % | 353,234 | 270,203 | 30.7 | % | |||||||||
| EXPENSES | |||||||||||||||||
| Depreciation and amortization expense | 27,550 | 22,167 | 24.3 | % | 52,574 | 44,653 | 17.7 | % | |||||||||
| Cost of spare parts and equipment sales | 28,102 | 5,437 | 416.9 | % | 43,425 | 8,142 | 433.3 | % | |||||||||
| Cost of maintenance services | 8,621 | 5,671 | 52.0 | % | 13,950 | 11,245 | 24.1 | % | |||||||||
| Write-down of equipment | 11,458 | — | nm | 13,567 | 261 | 5,098.1 | % | ||||||||||
| General and administrative | 50,429 | 34,687 | 45.4 | % | 98,149 | 64,268 | 52.7 | % | |||||||||
| Technical expense | 7,508 | 4,518 | 66.2 | % | 13,738 | 12,773 | 7.6 | % | |||||||||
| Net finance costs: | |||||||||||||||||
| Interest expense | 33,569 | 24,562 | 36.7 | % | 65,663 | 47,565 | 38.0 | % | |||||||||
| Total net finance costs | 33,569 | 24,562 | 36.7 | % | 65,663 | 47,565 | 38.0 | % | |||||||||
| Total expenses | 167,237 | 97,042 | 72.3 | % | 301,066 | 188,907 | 59.4 | % | |||||||||
| Income from operations | 28,265 | 54,078 | (47.7 | )% | 52,168 | 81,296 | (35.8 | )% | |||||||||
| Gain on sale of business | 42,950 | — | nm | 42,950 | — | nm | |||||||||||
| Income from joint ventures | 3,082 | 3,825 | (19.4 | )% | 4,433 | 6,499 | (31.8 | )% | |||||||||
| Income before income taxes | 74,297 | 57,903 | 28.3 | % | 99,551 | 87,795 | 13.4 | % | |||||||||
| Income tax expense | 13,920 | 15,317 | (9.1 | )% | 22,305 | 24,340 | (8.4 | )% | |||||||||
| Net income | 60,377 | 42,586 | 41.8 | % | 77,246 | 63,455 | 21.7 | % | |||||||||
| Preferred stock dividends | 1,353 | 910 | 48.7 | % | 2,676 | 1,810 | 47.8 | % | |||||||||
| Accretion of preferred stock issuance costs | 69 | 12 | 475.0 | % | 139 | 24 | 479.2 | % | |||||||||
| Net income attributable to common shareholders | $ | 58,955 | $ | 41,664 | 41.5 | % | $ | 74,431 | $ | 61,621 | 20.8 | % | |||||
| Basic weighted average income per common share | $ | 8.68 | $ | 6.34 | $ | 11.11 | $ | 9.51 | |||||||||
| Diluted weighted average income per common share | $ | 8.43 | $ | 6.21 | $ | 10.64 | $ | 9.22 | |||||||||
| Basic weighted average common shares outstanding | 6,789 | 6,570 | 6,698 | 6,479 | |||||||||||||
| Diluted weighted average common shares outstanding | 6,990 | 6,714 | 6,995 | 6,687 | |||||||||||||
Unaudited Condensed Consolidated Balance Sheets
(In thousands, except per share data)
| June 30, 2025 | December 31, 2024 | |||||||
| ASSETS | ||||||||
| Cash and cash equivalents | $ | 37,267 | $ | 9,110 | ||||
| Restricted cash | 745,268 | 123,392 | ||||||
| Equipment held for operating lease, less accumulated depreciation | 2,606,593 | 2,635,910 | ||||||
| Maintenance rights | 34,734 | 31,134 | ||||||
| Equipment held for sale | 13,191 | 12,269 | ||||||
| Receivables, net | 37,644 | 38,291 | ||||||
| Spare parts inventory | 63,609 | 72,150 | ||||||
| Investments | 91,123 | 62,670 | ||||||
| Property, equipment & furnishings, less accumulated depreciation | 62,653 | 48,061 | ||||||
| Intangible assets, net | 271 | 2,929 | ||||||
| Notes receivable, net | 171,846 | 183,629 | ||||||
| Investments in sales-type leases, net | 16,779 | 21,606 | ||||||
| Other assets | 65,467 | 56,045 | ||||||
| Total assets | $ | 3,946,445 | $ | 3,297,196 | ||||
| LIABILITIES, REDEEMABLE PREFERRED STOCK AND SHAREHOLDERS' EQUITY | ||||||||
| Liabilities: | ||||||||
| Accounts payable and accrued expenses | $ | 86,720 | $ | 75,983 | ||||
| Deferred income taxes | 203,726 | 185,049 | ||||||
| Debt obligations | 2,800,643 | 2,264,552 | ||||||
| Maintenance reserves | 113,121 | 97,817 | ||||||
| Security deposits | 24,204 | 23,424 | ||||||
| Unearned revenue | 36,833 | 37,911 | ||||||
| Total liabilities | 3,265,247 | 2,684,736 | ||||||
| Redeemable preferred stock ($0.01 par value) | 63,261 | 63,122 | ||||||
| Shareholders' equity: | ||||||||
| Common stock ($0.01 par value) | 76 | 72 | ||||||
| Paid-in capital in excess of par | 56,000 | 50,928 | ||||||
| Retained earnings | 562,121 | 491,439 | ||||||
| Accumulated other comprehensive (loss) income, net of tax | (260 | ) | 6,899 | |||||
| Total shareholders' equity | 617,937 | 549,338 | ||||||
| Total liabilities, redeemable preferred stock and shareholders' equity | $ | 3,946,445 | $ | 3,297,196 | ||||
| CONTACT: | Scott B. Flaherty |
| Executive Vice President & Chief Financial Officer | |
| 561.413.0112 |
