Company: AYR
Filing Date: 2025-07-10
Form Type: 10-Q
Source: 0001628280-25-034715
Chunk: 27

Company: Aircastle LTD
Filing Date: 2025-07-10
Form: 10-Q
Item: Part I, Item 1
Chunk 27
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 discounts and lease incentives:

 Three Months Ended May 31, 20252024 (Dollars in thousands)Amortization of lease premiums$(1,887)$(3,242)Amortization of lease discounts3,523 694 Amortization of lease incentives1,130 (4,101)Amortization of lease premiums, discounts and incentives$2,766 $(6,649)

The amortization of lease discounts increased $2.8 million due to the acquisition of aircraft.

The amortization of lease incentives decreased $5.2 million primarily due to the reversal of lease incentive liabilities related to 2 engine redeliveries.

Maintenance revenue.  For the three months ended May 31, 2025 and 2024, we recorded $38.1 million and $42.1 million of maintenance revenue, respectively, primarily related to maintenance payments received by us and recognized into income as a result of scheduled aircraft lease expirations and engine redeliveries.

Gain on sale or disposition of flight equipment.  During the three months ended May 31, 2025, we sold 14 aircraft and other flight equipment for gains totaling $30.3 million.

During the three months ended May 31, 2024, we sold 2 aircraft and other flight equipment for gains totaling $1.0 million.

Operating expenses

Total operating expenses increased $9.1 million, attributable to:

Depreciation expense increased $6.5 million, primarily attributable to an increase of $15.8 million related to 57 aircraft acquired since March 1, 2024.  This increase was partially offset by a decrease of $9.9 million related to 39 aircraft sold since March 1, 2024.

Interest, net increased $4.0 million due to a higher average cost of borrowing and a higher weighted average debt outstanding of $273.1 million.

Impairment of flight equipment.  During the three months ended May 31, 2025, the Company recorded transactional impairment charges totaling $5.1 million related to engine redeliveries and 1 aircraft lease termination. The Company recognized $18.7 million of revenue related to maintenance, security deposits, and the reversal of lease incentive liabilities for these engines and aircraft during the three months ended May 31, 2025.

During the three months ended May 31, 2024, the Company recorded a transactional impairment charge of $5.2 million related to