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AerSale swings to profit despite revenue slip in third quarter

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AerSale swings to profit despite revenue slip in third quarter

AerSale's revenues slipped to $82.7 million in the third quarter of 2024, down from $92.5 million in the same period last year. Despite this, the company swung to a profit of $0.5 million, compared to its third quarter loss of $0.1 million last year. 

Products revenue fell from $66.8 million down to $47.7 million, while its services revenue increased from $23.2 million to $28.1 million. The company's leasing revenue more than doubled from $2.5 million up to $6.9 million. 

Expenses for the period totalled $59 million, down from $69 million a year prior. The company's adjusted EBITDA was $8.2 million versus $1.9 million last year. 

As of the quarter end, the company's total assets were valued at $601.5 million. Total liabilities and stockholders' equity was also $601.5 million. The company's liquidity was $103.5 million, consisting of $9.8 million in cash and available capacity of $93.7 million on its $180 million revolving credit facility, which can be expanded to $200 million.

The company had suffered a loss in the second quarter due to a fire at one of its leased auxiliary used service material (USM) inventory facilities in New Mexico. 

“In that facility, we had approximately $67.6 million of inventory valued at market prices, which is fully covered by insurance and for which we have made a $67.6 million claim,” said AerSale CFO Martin Garmendia in its earnings call. The claim is subject to a $10,000 deductible. 

The company also has an outstanding claim of $5.5 million against insurers for a GE CF-6080C2 engine that was detained in Russia after the breakout of the Ukraine conflict. 

Payment for both claims are expected at year-end.