Company: AYR
Filing Date: 2025-10-09
Form Type: 10-Q
Source: 0001628280-25-044676
Chunk: 57

Company: Aircastle LTD
Filing Date: 2025-10-09
Form: 10-Q
Item: Part I, Item 8
Chunk 57
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ated equity method investment.We record aircraft at fair value when we determine the carrying value may not be recoverable. Fair value measurements for aircraft in impairment tests are based on the average of the market approach (Level 2 or 3), which includes third-party appraisal data, and an income approach (Level 3), which includes the Company’s assumptions and appraisal data as to the present value of future cash proceeds from leasing and selling aircraft. Level 3 valuations contain significant non-observable inputs. See “Aircraft Valuation” below for further information.We account for our unconsolidated equity method investment under the equity method of accounting. Our investment is recorded at cost and is adjusted by undistributed earnings and losses and the distributions of dividends and capital. This investment is reviewed for impairment whenever events or changes in circumstances indicate the fair value is less than its carrying value and the decline is other-than-temporary.Financial InstrumentsOur financial instruments, other than cash, consist principally of cash equivalents, accounts receivable, investments in debt and equity securities, accounts payable and secured and unsecured financings. The fair value of cash and cash equivalents, accounts receivable and accounts payable approximates the carrying value of these financial instruments because of their short-term nature.The fair value of our investments, which consist of debt and equity securities, have been valued using either quoted market prices to the extent such securities are traded in an active market (Level 1), or using the income approach for those 

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Aircastle Limited and SubsidiariesNotes to Unaudited Consolidated Financial Statements(Dollars in thousands, except per share amounts)August 31, 2025

securities where there is no active market or there is limited market data (Level 3). The fair value of our senior notes is estimated using quoted market prices (Level 1), whereas all our other financings are valued using a discounted cash flow analysis, based on our current incremental borrowing rates for similar types of borrowing arrangements (Level 2).The carrying amounts and fair values of our financial instruments at August 31, 2025 and February 28, 2025, were as follows:August 31, 2025February 28, 2025AssetsCarrying Amountof AssetFair Valueof AssetCarrying Amountof AssetFair Valueof AssetInvestments, at fair value(1)$5,446 $5,446 $9,912 $9,912 Other investments, net728 728 4,916 4,