Q4 2023 Earnings Summary
Reported on Feb 18, 2025 (After Market Close)
Pre-Earnings Price$57.90Last close (Feb 23, 2024)
Post-Earnings Price$57.90Last close (Feb 23, 2024)
Price Change
$0.00(0.00%)
- FTAI is expanding into the V2500 engine MRO business, expecting an additional $25 million in EBITDA for 2024 with potential upside. They are leveraging their expertise to offer cost savings and flexibility to airlines, aiming to become the leading full-service aftermarket power provider for all 737NG and A320-CEO aircraft globally.
- Lease rates for engines and aircraft have increased significantly, with engine lease rates rising to $75,000 per month plus maintenance reserves from pre-COVID levels of $60,000, and aircraft lease rates up 20% to 40%. This is due to industry dynamics like production caps on new aircraft, extending the imbalance between supply and demand, benefiting FTAI's revenue potential.
- FTAI's unique ability to purchase off-lease and unserviceable assets at discounted prices and add value through their repair capabilities gives them a competitive edge in asset acquisition and value creation. They can buy assets that others avoid and fix anything, leading to attractive returns.
- The Aerospace Products segment's strong Q4 EBITDA of $54.6 million included a one-time, noncash gain of about $5 million from the revaluation of QuickTurn, which may not recur in future quarters.
- Both well intervention vessels were off-hire in Q4, causing a headwind in earnings, and one vessel experienced a breakdown, with repairs extending until March, indicating potential operational issues in this segment.
- The FAA's rigorous process for PMA approval has inherent difficulty in predicting completion timing, which may delay the company's progress in its PMA initiatives and impact growth in the Aerospace Products segment.