Nov. 6, 2009 (PR Newswire) -- AMSTERDAM, Nov. 6 /PRNewswire-FirstCall/ -- AerCap Holdings N.V. (the "Company" or "AerCap") (NYSE: AER) today announced the results of its operations for the third quarter ended September 30, 2009.

Third Quarter 2009 Highlights

--  Third quarter 2009 net income was $35.5 million, compared with net
income of $51.3 million for the same period in 2008. Third quarter 2009
net income excluding the impact of the mark-to-market of interest rate
caps and share-based compensation was $39.2 million, compared with $61.2
million in third quarter 2008 on the same basis. The decrease in net
income was largely due to lower maintenance revenue and lower income
from the sale of assets in third quarter 2009 as compared to third
quarter 2008.
--  Third quarter 2009 basic and diluted earnings per share were $0.42.
Third quarter 2009 basic and diluted earnings per share excluding the
impact of the mark-to-market of interest rate caps and share-based
compensation were $0.46.
--  Net spread, the difference between basic lease rents and interest
expense excluding the impact from the mark-to-market of interest rate
caps, was $114.6 million in third quarter 2009 compared to $93.3 million
in third quarter 2008, an increase of 23%. This measure reflects the
increase in leasing income.
--  Basic lease revenue for the third quarter 2009 was $142.4 million,
compared to $132.9 million for the same period in 2008, an increase of
7%. Total lease revenue for the third quarter 2009 was $153.8 million,
compared to $167.9 million for the same period in 2008, a decrease of
8%. The decrease in total lease revenue was due to lower maintenance
rents in third quarter 2009 as compared to third quarter 2008.
--  Total revenue for the third quarter 2009 was $212.5 million, compared to
$301.9 million for the same period in 2008. The decrease was mainly due
to lower aircraft sales revenue and lower maintenance revenue, partially
offset by higher basic lease revenue.
--  Sales revenue for the third quarter 2009 was $49.0 million, compared to
$122.4 million for the same period in 2008, and was generated from the
sale of one aircraft, three engines and parts inventory.  In addition,
on October 29, 2009, we executed agreements for the sale of three of our
A330-300 forward order aircraft delivering in 2010 (the sales will be
recorded at time of delivery).
--  Total assets were $6.4 billion at September 30, 2009, an increase of 22%
over total assets of $5.3 billion at September 30, 2008.

--  Committed purchases of aviation assets delivered or scheduled for
delivery in 2009 are $1.8 billion, of which $1.1 billion closed in the
nine month period ended September 30, 2009.

Previously disclosed Third Quarter 2009 Highlights

    --  In third quarter 2009, AerCap announced that the Boards of Directors of
AerCap Holdings N.V. and Genesis Lease Limited had approved a definitive
agreement under which AerCap and Genesis will merge in an all
share-for-share transaction.

Klaus Heinemann, CEO of AerCap, commented: "AerCap continues to substantially grow its core leasing business as measured by the Company's net spread results. Additionally, we have expanded AerCap's overall market position through the share-for-share transaction with Genesis Lease. Both are clear evidence that AerCap is well positioned to take advantage of the prevailing market dislocation. The performance of emerging markets and low cost carriers has begun to improve. Resumed 2010 passenger growth along with fuel costs based on 75 to 100 dollars per barrel, will enable the market for modern, state of the art narrowbodies to rapidly rebalance."

AerCap's CFO, Keith Helming, said: "Our third quarter 2009 results highlight the consistent growth in the Company's leasing related earnings as demonstrated through the 23% increase in net spread. Additionally, the Company's margin of net spread divided by average lease assets has remained constant year-over-year. The Company's consistent performance is attributable to the decrease in interest rates coupled with the use of interest rate caps, plus relatively stable basic lease rents achieved on deliveries of new, fuel-efficient aircraft."

Summary of Financial Results

AerCap recorded a third quarter 2009 net income of $35.5 million or $0.42 earnings per basic and diluted share. Included in the third quarter 2009 net income amount were charges relating to mark-to-market of interest rate caps and share-based compensation of $3.7 million or $0.04 per basic and diluted share, net of tax. The after-tax charge relating to the mark-to-market of our interest rate caps was $3.0 million and the after-tax charge from share-based compensation was $0.7 million.

Detailed Financial Data

($ in Millions)

Operating results:

Three months ended           Nine months ended
September 30,               September 30,
----------------------      ----------------------
% increase/                 % increase/
2009   2008  (decrease)     2009   2008  (decrease)
----   ----   --------      ----   ----  ---------

Revenues           $212.5 $301.9     -30%      $715.7 $929.8    -23%
Net income           35.5   51.3     -31%       122.0  170.8    -29%
Net income
excluding the
impact of mark-
to-market of
interest rate
caps and share-
based compensation  39.2   61.2     -36%       109.9  179.0    -39%

Total revenue in third quarter 2009 decreased 30% compared with third quarter 2008. This decrease was largely driven by lower sales revenue and lower maintenance revenue, partially offset by higher basic lease revenue.

Net income excluding the impact of mark-to-market of interest rate caps and share-based compensation decreased by 36%. This decrease was also driven by lower maintenance revenue ($20.6 million) and lower income from the sale of assets ($5.8 million), partially offset by an increase in net spread.

Revenue breakdown

Three months ended          Nine months ended
September 30,              September 30,
----------------------      ----------------------
% increase/                 % increase/
2009   2008  (decrease)     2009   2008  (decrease)
----   ----   --------      ----   ----  ---------

Lease revenue:
Basic lease
rents          $142.4 $132.9      7%       $425.2 $386.0     10%
Maintenance
rents            10.4   34.6    -70%         49.9   57.6    -13%
End-of-lease
compensation
and other
receipts          1.0    0.4    150%          9.7   12.5    -22%
----   ----   --------      ----   ----  ---------
Lease
revenue           $153.8 $167.9     -8%       $484.8 $456.1      6%
Sales
revenue             49.0  122.4    -60%        202.4  445.6    -55%
Management fees
and interest
income               5.3    8.0    -34%         17.0   23.9    -29%
Other
revenue              4.4    3.6     22%         11.5    4.2    174%
----   ----   --------      ----   ----  ---------
Total
revenue           $212.5 $301.9    -30%       $715.7 $929.8    -23%
=====  =====   ========     =====  =====  =========

Basic lease rents continue to increase when compared to prior periods as a result of our growing asset base. The increase in basic lease rents of 7% was less than the increase in average lease assets of 23%, as a result of decreasing interest rates. The impact of decreasing interest rates on basic lease rents was offset by lower interest expense. While basic lease rents for the third quarter 2009 increased 7% compared to third quarter 2008 to $142.4 million, interest expense excluding the impact of mark-to-market of interest rate caps decreased 30% compared with third quarter 2008 to $27.8 million, as shown in the table below. We refer to the difference in these amounts as net spread, which increased 23% in third quarter 2009 over the same period in 2008 to an amount of $114.6 million. Our average lease assets increased by 23% to $4.6 billion compared to third quarter 2008.

Maintenance related revenues, including end-of-lease compensation, decreased $23.6 million in third quarter 2009 to $11.4 million from $35.0 million in third quarter 2008. The decrease was largely due to $21.2 million of non-recurring maintenance revenue in third quarter 2008. The non-recurring maintenance revenue related to a change in the estimate of the amount of maintenance rent expected to be reimbursed to lessees plus airline defaults. The change in estimate arose from the implementation of an improved model used to forecast future maintenance reimbursements, as disclosed in our previous filings. Since third quarter 2008 AerCap records as revenue all maintenance rent receipts not expected to be repaid to lessees. In third quarter 2008, $16.6 million was recorded as maintenance revenue as a result of the change in estimate. Of the $16.6 million, $12.9 million was collected from lessees during prior periods and was non-recurring.