Avolon has reported strong third-quarter earnings alongside the finalisation of major order with Airbus for 90 new aircraft.
In this year's third quarter, the company posted a net income of $149 million, an increase of 24% year over year.
Operating cash flow was up 1% to $539 million for the quarter, bringing the company’s total operating cash flow for the last 12 months to $2.1bn.
Among other highlights in its financial results, Avolon pointed to $2.2bn in new financing raised during the quarter, including $1.9bn of unsecured notes and $260 million in new unsecured bank facilities.
The Dublin-based lessor also repaid $829 million of secured debt and completed a tender offer for $1bn of senior unsecured notes due in 2027.
Total available liquidity was $9bn at end of the quarter, including $579 million of unrestricted cash and $7.3 billion in undrawn debt facilities.
Avolon’s balance sheet now comprises an unsecured to total debt ratio of 76%, with net debt to equity of 2.5x and $23bn of unencumbered assets.
“Our positive financial performance continued in Q3, reflecting sustained demand for our aircraft and an active trading market,” said Andy Cronin, CEO of Avolon.
“We continue to strengthen our balance sheet and increased our unsecured debt ratio. With 99% of our deliveries placed over the next two years, demand for our aircraft remains exceptionally strong.”
Avolon’s key business highlight for the quarter was the finalisation of a long-term, incremental order with Airbus.
Under this order, Avolon will receive 75 A321neo and 15 A330neo aircraft, which are scheduled to be delivered through 2033.
Avolon also acquired 17 aircraft during the quarter, sold 15 aircraft and ended the quarter with 60 aircraft agreed for sale.
It placed eight aircraft from its orderbook, ending the quarter with 99% of the orderbook placed for the next 24 months.
At the quarter’s end, Avolon had an owned, managed and committed fleet of 1,159 aircraft, including orders and commitments for 522 new technology aircraft.
In its earnings release, the company also announced several new executive hires, including the appointment of Chris Jin as chairman.
Jin was previously non-executive director of Avolon from January 2016 to February 2022, and held the role of chairman from February 2021 until February 2022.
He will replace Zhang (Jason) Can as chairman, who will remain at Avolon as a non-executive director.
Ding Chen has also joined as a non-executive director, while Shen Yan and Julian Wang have retired from the board.