AerSale closed 2024 swinging to a net profit of $2.7 million in the fourth quarter, compared to a net loss of $2.7 million a year prior. For the full year, net profit totalled $5.9 million, swinging from a net loss of $5.6 million in 2023.
The company’s fourth quarter revenues totalled $94.7 million, which was marginally higher than 2023’s $94.4 million. This is despite a $16.4 million reduction in whole asset sales compared to 2023. Excluding whole asset sales, fourth quarter sales were up 35.5%.
Full year revenues were $345.1 million, up 3.2% compared to 2023. Excluding whole asset sales, revenue for the full year increased 18.7%.
The company said stronger used service material (USM) volume, sustained demand for maintenance, repair, and overhaul (MRO) services, and an expanded lease pool had driven the positive performance.
AerSale’s MRO revenues totalled $108 million in the full year, up from $102.5 million in 2023. Fourth quarter MRO revenues were $24.5 million, up around $0.7 million compared to a year prior.
The company expects MRO revenues to build further upon 2024. In addition, the segment will be supported by the company’s cost and operational efficiency planning. “Not only do we expect revenue growth, but we’re expecting margins to also improve,” said AerSale CFO Martin Garmendia.
Adjusted EBIT for the quarter was $13 million, more than doubling from $6 million a year prior. Fourth quarter gross margin was 31.4%, up from 25.9% a year prior. This was driven by sales mix that included higher margin engine leasing flight equipment sales.
For the full year, adjusted EBITDA was $33.4 million, again more than doubling from $12.3 million in 2023. The increase was largely driven by higher volume, a more favourable sales mix, as well as the company’s more “cost conscious” approach to the business.
“Our efficiency programme is expected to save $10.4 million annually, accumulating throughout the year based on demand,” said AerSale chairman and CEO Nick Finazzo. “This in addition to the $10 million saved in 2024 through increased efficiency.”
Finazzo said the “very tight feedstock market” is continuing due to OEM production constraints, engine issues, and regulatory oversight such as the FAA’s production cap on Boeing. With the weighted average age of aircraft increasing as airlines hold onto their aircraft longer as a result of delays, the company has found securing inventory more competitive.
However, he maintained the company continues to secure deals. “We win deals when flight equipment comes out and it needs a lot of work,” he said.
The company, he said, is not the most aggressive bidder, but its advantage is its strong financials. Finazzo explained: “Our advantage is we have the balance sheet, we have the availability of cash, we have the infrastructure to monetize flight equipment that needs a lot of work.”
The company said its focus for 2025, aside from expanding growth opportunities, will be to convert its inventory into cash.
“The main contributors to our top line in 2025 will include expanding our lease pool, which saw significant progress in 2024, ending the year with 17 engines, and one 757 freighter aircraft on lease,” said Finazzo. “This revenue stream is expected to recur and grow as we add more assets to the lease pool.”
Leasing revenues more than doubled to $7.9 million in the fourth quarter, compared to $3.1 million in 2023. For the full year, leasing revenues amounted to $22.1 million, up from $14.5 million a year prior.
Total cost of sales in the fourth quarter were down to $65 million, compared to $70 million. For the full year, cost of sales was down from $242.1 million in 2023 to $241.1 million in 2024.
AerSale said it expects 2025 to be a growth year on both the top and bottom line, supported by a stronger foundation of multiple growing revenue streams.