Chorus Aviation has reported a strong third quarter of 2022 with a net income of $23.6 million, a quarter-over-quarter increase of $37.6 million, and an adjusted net income of $41.7 million
Joe Randell, President and Chief Executive Officer, Chorus, said: "With our first full quarter since the Falko acquisition now complete, I am pleased to report both the continued seamless integration of our leasing business under Falko and the achievement of its expected financial performance.”
Chorus continued to generate strong cash flows and execute its strategy to transition to an asset-light leasing model in the quarter by closing the Q3 with a cash of $100.9 million. The cash balance was mostly due to asset sales net of debt repayments and the release of security over previously restricted cash. Chorus had cash flows from operations of $91.3 million in the third quarter, an increase of $8.5 million over the third quarter of 2021.
"We will continue to transition to an asset-light model and opportunistically explore asset sales, creating additional shareholder value by generating incremental cash flows and paying down debt. In addition, we look forward to the closing of Falko’s next fund in the first half of 2023,” Randell added.
Chorus repaid $219.7 million of debt including scheduled repayments of $81.1 million, $112.0 millions of repayments on loans related to the eight CRJ900s sold, and a $26.6 million discretionary repayment on the Operating Credit Facility. On October 6, 2022, Chorus repaid the remaining balance on its Operating Credit Facility of US $19.0 million.
In the third quarter of 2022, Chorus reported an Adjusted EBITDA of $123.4 million, an increase of $45.3 million over the third quarter of 2021.
The Regional Aircraft Leasing (RAL) segment’s Adjusted EBITDA was $69.8 million, an increase of $43.7 million primarily due to Falko’s earnings, the recovered claims in the Virgin Australia bankruptcy, net gain on sale of assets as well as increased lease revenue from CACIL’s re-leased aircraft.
Chorus reported that the first half of 2023 will witness a new investment fund managed by Falko with a minimum of US $500.0 million in capital commitments, management fees, and economic terms commensurate with those in Falko’s prior funds.
Going ahead Chorus expects the capital expenditures in 2022, including capitalized major maintenance overhauls but excluding expenditures for the acquisition of aircraft to be between $21.0 million and $32.0 million. Aircraft acquisitions and improvements in 2022 are expected to be between $19.0 million and $25.0 million.