The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Andrew Light - Citigroup - Analyst: Klaus, when you say there's been a pick up in activity regarding aircraft sales and lease rates, approximately at what percentage discount would you say that is at compared to say last year? Can you quantify it in some way?
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
Question: Andrew Light - Citigroup - Analyst: And would that apply -- so that applies to both lease rates and aircraft values would you say more or less?
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
Question: Andrew Light - Citigroup - Analyst: Right and second question, regarding your outstanding order, obviously you've made a lot of progress there and I think Keith said in the last call that if it wasn't fully placed you would consider deferring. Is that now off the agenda?
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
Question: Andrew Light - Citigroup - Analyst: And secondly, the number of airlines are trying to defer their aircraft orders with Airbus and Boeing and I am thinking particularly the Indian Airlines and I also read Aeroflot is doing the same. Are they putting pressure -- are these kinds of airlines putting pressure on you to defer your deliveries to them or was it purely just for the manufacturers directly?
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
Question: Andrew Light - Citigroup - Analyst: Oh okay great. Thanks very much indeed for that.
Question: Brandon Oglensky - Barclays Bank - Analyst: Very quickly on the leasing expenses you said that you'd spent about $10 million over the -- I believe the course of the year in default expenses this year. Is that per quarter or did I hear it right that it's for the remainder of the year?
Answer By: Keith Helming - AerCap Holdings N.V. - CFO
Question: Brandon Oglensky - Barclays Bank - Analyst: Okay so I think, given that leasing expenses should be a little bit lower than what we've seen in first quarter.
Answer By: Keith Helming - AerCap Holdings N.V. - CFO
Question: Brandon Oglensky - Barclays Bank - Analyst: Okay great and then in regards to the AerVenture JV, how is that going to impact minority interests in the remaining quarters and specifically associated with the six forward A320 sales that you have this year?
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
Question: Brandon Oglensky - Barclays Bank - Analyst: I was just wondering if --
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
Question: Brandon Oglensky - Barclays Bank - Analyst: Okay that's really what I was getting at. If they still had interests in that sale.
Answer By: Keith Helming - AerCap Holdings N.V. - CFO
Question: Brandon Oglensky - Barclays Bank - Analyst: And I guess you guys had said that you're looking at numerous parties potentially filling the AerVenture JV as well and I guess that's relating to the $280 million gap you're speaking to in the presentation. Can you just give us a little bit more information on where we are in that process and when you expect that to close? Or if?
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
Question: Brandon Oglensky - Barclays Bank - Analyst: And if that LOI were to be executed, would that essentially address the entire $280 million gap or is this just looking towards $140 million coming due by 2010?
Answer By: Keith Helming - AerCap Holdings N.V. - CFO
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
Answer By: Keith Helming - AerCap Holdings N.V. - CFO
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
Question: Brandon Oglensky - Barclays Bank - Analyst: And that $700 million that you relate to, that would be ECA eligible?
Answer By: Keith Helming - AerCap Holdings N.V. - CFO
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
Question: Brandon Oglensky - Barclays Bank - Analyst: Thank you very much, gentlemen.
Question: Scott Valentin - FBR Markets - Analyst: Just in terms of your tone you sound, Klaus, a lot more positive on the outlook and I guess the news maybe has been less negative lately but definitely has not turned. I was trying to see maybe if you're seeing something, maybe those in different markets but what makes you sound more positive or maybe I am just misinterpreting? www.streetevents.com Contact Us 10 ¬ 2009 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
Question: Scott Valentin - FBR Markets - Analyst: That's very helpful. Thank you very much.
Question: Gary Liebowitz - Wachovia Securities - Analyst: Klaus, you mentioned that you're less likely to defer some of your new orders but I noticed that your capital commitments now run out to 2013. I thought that the last delivery in the backlog would have delivered in the very early part of 2012. Did you, in fact, push something out and can you give us some color there?
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
Question: Gary Liebowitz - Wachovia Securities - Analyst: And also, one for Keith, the impairment charge that you had had in the quarter that related to some older rates 320s that came off lease. Do you expect more of those in the upcoming quarters? How should we think of impairments going forward? www.streetevents.com Contact Us 11 ¬ 2009 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.
Answer By: Keith Helming - AerCap Holdings N.V. - CFO
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
Answer By: Keith Helming - AerCap Holdings N.V. - CFO
Question: Gary Liebowitz - Wachovia Securities - Analyst: And can you remind me when you would start to convert some of these older A320s to freight or aircraft and when that happens does that mean you will not necessarily have to take an impairment charge?
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
Question: Gary Liebowitz - Wachovia Securities - Analyst: Yes I am done. www.streetevents.com Contact Us 12 ¬ 2009 Thomson Financial. Republished with permission. No part of this publication may be reproduced or transmitted in any form or by any means without the prior written consent of Thomson Financial.
Answer By: Klaus Heinemann - AerCap Holdings N.V. - CEO
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