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Item 1. Business

2026-04-21 compared with 2025-04-23 · 130 added, 121 removed, 142 unchanged (64% of the section changed)

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generally accepted accounting principles (“U.S.

Aircastle acquires, leases, and sells commercial jet aircraft to airlines throughout the world.

We are a leading secondary market investor that sources aircraft through various acquisition channels that include other aircraft lessors, airlines through purchase-leaseback transactions, financial institutions and other aircraft owners, and aircraft manufacturers.

We have significant experience in successfully managing aircraft throughout their life cycle, including lease and technical management, aircraft redeliveries, transitions, and sales or disposals.

We sell aircraft and engine assets, either with a lease attached or on a part-out basis, with the aim of generating profits and reinvesting proceeds.

Aircastle acquires, leases, and sells commercial jet aircraft to airlines worldwide.

We are a leading secondary market investor, sourcing aircraft through a variety of acquisition channels, including other aircraft lessors, airlines through purchase-leaseback transactions, financial institutions and other aircraft owners, and aircraft manufacturers.

We have significant experience in successfully managing aircraft throughout their life cycle, including lease and technical management, aircraft redeliveries, transitions, and asset sales or disposals.

We sell aircraft and engine assets, either with a lease attached or on a part-out basis, with the objective of generating profits and reinvesting sale proceeds.

Our aircraft are managed by an experienced team based in the United States, Ireland and Singapore.

As of February 28, 2025, we owned and managed on behalf of our joint venture 273 aircraft leased to 77 lessees located in 47 countries.

The net book value of our fleet (comprised of flight equipment held for lease and net investment in leases, or “Net Book Value”) was $7.9 billion as of February 28, 2025, up 9% from $7.2 billion as of February 29, 2024.

As of February 28, 2026, we owned and managed 282 aircraft leased to 76 lessees located in 45 countries.

The net book value of our fleet (comprised of flight equipment held for lease and net investment in leases, or “Net Book Value”) was $8.5 billion as of February 28, 2026, an increase of 8% from $7.9 billion as of February 28, 2025.

The weighted average age of our fleet was 9.0 years and the weighted average remaining lease term was 5.4 years.

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During the year ended February 28, 2026, we purchased 46 aircraft and sold 33 aircraft and other flight equipment.

As of February 28, 2025, we had commitments to purchase 20 aircraft with delivery through March 2027 for $771.7 million, which includes estimated amounts for pre-delivery deposits, contractual price escalations and other adjustments.

Our total revenues, net income and Adjusted EBITDA were $821.0 million, $123.6 million, and $789.9 million for the year ended February 28, 2025, respectively, and $855.4 million, $83.3 million and $759.5 million for the year ended February 29, 2024, respectively.

Cash flow provided by operating activities was $464.0 million and $370.3 million for the years ended February 28, 2025 and February 29, 2024, respectively.

The Company’s financial performance reflects the strong global passenger demand for air travel and the robust demand for our aircraft due to ongoing Original Equipment Manufacturer (“OEM”) delivery delays and supply chain constraints.

The increased demand for our aircraft through lease extension requests and strong gains on sales contributed positively to our financial results, which are also partly driven by cash settlement proceeds received in respect of our contingent and possessed insurance policies for aircraft formerly on lease to Russian airlines.

Growth in commercial air traffic has been correlated with world economic activity and has historically grown at a rate one to two times that of global gross domestic product (“GDP”) growth.

This expansion of air travel has driven growth in the world aircraft fleet.

There are approximately 27,000 commercial mainline passenger and freighter aircraft in the world fleet today.

As of February 28, 2026, we had commitments to purchase 17 aircraft with delivery through November 2028 for $829.5 million, which includes estimated amounts for pre-delivery deposits, contractual price escalations and other adjustments.

Our total revenues, net income and Adjusted EBITDA were $975.1 million, $194.0 million, and $945.1 million, respectively, for the year ended February 28, 2026, and $821.0 million, $123.6 million and $789.9 million, respectively, for the year ended February 28, 2025.

Cash flow provided by operating activities was $483.1 million and $464.0 million for the years ended February 28, 2026 and 2025, respectively.

Our financial performance continued to reflect strong global passenger demand for air travel and sustained demand for our narrow-body aircraft, driven by ongoing Original Equipment Manufacturer (“OEM”) delivery delays and broader supply chain constraints.

These market conditions supported elevated lease extension activity and strong gains on sales, which contributed positively to our operating results.

Our financial performance was also favorably impacted by additional cash settlement proceeds received in respect of our contingent and possessed insurance policies for aircraft formerly on lease to Russian airlines.

Growth in commercial air traffic has historically been correlated with global economic activity and has grown at a rate of approximately one to two times that of global gross domestic product (“GDP”) growth.

This growth in air travel has driven expansion of the global aircraft fleet, which currently consists of approximately 28,000 commercial mainline passenger and freighter aircraft.

Aircraft leasing companies own approximately 49% of the world’s commercial passenger jet aircraft.

Under normal circumstances, we would expect the global fleet to continue expanding at a 2-3% average annual rate.

We believe our portfolio, which is primarily comprised of new technology and mid-life, narrow-body aircraft, will remain attractive for our airline customers, enabling them to respond to the growing demand of global air travel.

As a leading secondary market investor, we believe that our long-standing business strategy of maintaining conservative leverage and limiting long-term financial commitments positions us well to take advantage of new investment opportunities as they arise.

Under normal market conditions, we would expect the global fleet to continue expanding at an average annual rate of approximately 2 to 3%.

We believe our portfolio, which is primarily comprised of new technology and mid-life narrow-body aircraft, will remain attractive to our airline customers, enabling them to respond to continued growth in global air travel demand.

As a leading secondary market investor, we believe that our long-standing strategy of maintaining conservative leverage and limiting long-term financial commitments positions us well to pursue attractive investment opportunities as they arise.

We employ a team of experienced senior professionals with extensive industry and financial experience.

Our leadership team has an average of more than 30 years of relevant industry experience and has effectively enabled us to manage through prior downturns in the aviation industry, such as the COVID-19 pandemic, the 2008 global financial

crisis, and the September 11, 2001 terror attacks.

Our leadership team has an average of more than 30 years of relevant industry experience and has successfully managed the business through prior periods of industry disruption, including the COVID-19 pandemic, the 2008 global financial crisis, and the September 11, 2001 terror attacks.

We believe we have sufficient liquidity to meet our contractual obligations over the next 12 months.

As of April 1, 2025, total liquidity of $2.7 billion included $2.1 billion of undrawn credit facilities, $0.5 billion of projected adjusted operating cash flows and sales through April 1, 2026 and $0.1 billion of unrestricted cash.

As of April 1, 2026, total liquidity of approximately $2.6 billion consisted of $2.0 billion of undrawn credit facilities, $0.5 billion of projected adjusted operating cash flows and sales through April 1, 2027 and $0.1 billion of unrestricted cash through April 1, 2027.

Middle East Conflict

Recent armed conflicts and heightened geopolitical tensions in the Middle East have increased uncertainty regarding regional stability.

Military actions and retaliatory measures involving multiple parties in the region have disrupted, and may continue to disrupt, commercial aviation and related economic activity, including oil markets and trade flows.

We are closely monitoring the evolving conflict and related geopolitical developments.

While the ultimate impact on our business, financial condition and results of operations is currently uncertain, these hostilities have adversely affected, and an escalation or prolonged continuation of hostilities could continue to adversely affect, commercial aviation activity in the region, including through airspace closures, reduced flight operations, increased fuel and insurance costs, supply chain disruptions and broader macroeconomic effects.

Such impacts could, in turn, negatively affect the financial condition and operating performance of airlines operating in, or flying through, the region, potentially resulting in lease restructurings, payment deferrals, or defaults.

As of and for the year ended February 28, 2026, our airline customers located in the Middle East represented approximately 5% of both our Net Book Value and lease rental revenue.

Although our exposure to the region is limited and diversified across lessees and aircraft types, a sustained deterioration in regional or economic conditions could nevertheless have an adverse effect on our business, financial condition and results of operations.

Our Competitive Strengths

We believe the following competitive strengths will allow us to capitalize on future growth opportunities in the global aviation industry:

• Diversified Portfolio of Modern Aircraft:

We have a portfolio of modern aircraft that is diversified with respect to lessees, geographic markets, lease maturities and aircraft types.

As of February 28, 2025, our owned and managed aircraft portfolio consisted of 273 aircraft leased to 77 lessees in 47 countries.

We believe the following competitive strengths positions us to generate attractive risk-adjusted returns and capitalize on growth opportunities across market cycles in the global aviation industry:

• Diversified Portfolio of Modern, in Demand Aircraft:

We own a portfolio of modern commercial jet aircraft that is diversified by lessee, geography, lease maturity and aircraft type.

As of February 28, 2026, our owned and managed aircraft fleet consisted of 282 aircraft leased to 76 lessees in 45 countries.

Lease expirations for our owned aircraft are well dispersed, with a weighted-average remaining lease term of 5.4 years.

This provides us with a long-dated base of contracted revenues.

We believe our focus on portfolio diversification reduces the risks associated with individual lessee defaults and adverse geopolitical or economic issues, and results in generally predictable cash flows.

• Flexible, Disciplined Acquisition Approach and Broad Investment Sourcing Network :

Our investment strategy is to seek out the best risk-adjusted return opportunities across the commercial jet market, so our acquisition targets vary with market opportunities.

We believe our focus on portfolio diversification reduces the risks associated with individual lessee defaults and localized geopolitical or economic disruptions, and results in generally predictable cash flows.

• Flexible, Disciplined Acquisition Strategy Supported by a Broad Sourcing Network :

Our investment strategy is designed to identify attractive risk-adjusted return opportunities across the commercial jet market, allowing our acquisition activity to adapt to changing market conditions.

We source our acquisitions through well-established relationships with other aircraft lessors, airlines, financial institutions, other aircraft owners and aircraft and engine manufacturers.

Since our formation in 2004, we have acquired 691 aircraft for $23.0 billion as of February 28, 2026.

We have built our aircraft portfolio through more than 208 transactions with 109 counterparties as of February 28, 2025.

• Significant Experience in Successfully Selling Aircraft Throughout Their Life Cycle :

We have executed more than 217 transactions with 115 counterparties as of February 28, 2026, reflecting the breadth of our sourcing network and enhancing our ability to selectively deploy capital where we see the most compelling opportunities.

• Significant Experience in Successfully Selling Aircraft Across Their Life Cycle :

Our team is adept at managing and executing the sale of aircraft, either with a lease attached or on a part-out basis.

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often being sold on a part-out disposition basis, where the airframe and engines may be sold to various buyers.

We believe our competence in selling older aircraft is one of the capabilities that sets us apart from many of our competitors.

• Strong Capital Raising Track Record and Access to a Wide Range of Financing Sources:

We believe our proven capability to sell older aircraft differentiates us from many of our competitors.

• Strong Capital Raising Track Record and Access to Diverse Global Funding Sources:

Since our inception, we have raised $2.6 billion in equity capital from private and public investors as of February 28, 2026.

We maintain a strong, strategic relationship with Marubeni Corporation (“Marubeni”), which is one of our controlling shareholders.

We have raised $23.1 billion in debt capital from a variety of sources, including the unsecured bond market, commercial banks, export credit agency-backed debt, the aircraft securitization market and Japanese Operating Lease with Call Option (“JOLCO”) financings, which have been originated by Marubeni.

The diversity and global nature of our financing sources demonstrates our ability to adapt to changing market conditions and seize new opportunities.

In addition, we have raised $25.0 billion in debt capital from a variety of sources, including the unsecured bond market, commercial banks, export credit agency-backed debt and the aircraft securitization

We maintain strong, strategic relationships with our shareholders, Marubeni Corporation (“Marubeni”) and Mizuho Leasing Company, Limited (“Mizuho Leasing” and together with Marubeni, our “Shareholders”), who have originated Japanese structured aircraft investment transactions, including Japanese Operating Lease and Japanese Operating Lease with Call Option (“JOLCO”) transactions.

The diversity and global nature of our financing sources demonstrate our ability to adapt to changing market conditions and seize new opportunities.

• Our Capital Structure Provides Investment Flexibility:

As of February 28, 2025, we had $2.0 billion available from unsecured revolving credit facilities, 98% of which is not scheduled to mature until 2027 and 2028, thereby limiting our near-term financial markets exposure.

Given our relatively limited future capital commitments, we have the resources to take advantage of future investment opportunities.

As of February 28, 2026, we had $1.9 billion available from unsecured revolving credit facilities, 100% of which is not scheduled to mature until 2028 through 2029, thereby limiting our near-term financial markets exposure.

Combined with our relatively limited forward capital commitments, we have the resources to take advantage of future investment opportunities.

Our large, unencumbered asset base and our unsecured revolving lines of credit give us access to the unsecured bond market, which we expect will allow us to pursue a flexible and opportunistic investment strategy over the long term.

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Our leadership team has significant relevant industry experience, and we have expertise in the acquisition, leasing, financing, technical management, restructuring/repossession and sale of aviation assets.

This experience spans several industry cycles and a wide range of business conditions and is global in nature.

We believe our management team is highly qualified to manage and grow our aircraft portfolio and to address our long-term capital needs.

This experience spans several industry cycles, a wide range of business conditions and diverse geographic markets.

We believe our management team is well positioned to manage risk, optimize portfolio performance and support our long-term capital and growth objectives.

• Global and Scalable Business Platform:

We operate through offices in the United States, Ireland and Singapore, using a modern asset management system designed specifically for aircraft operating lessors and

capable of handling a significantly larger aircraft portfolio.

We operate through offices in the United States, Ireland and Singapore, using a modern asset management system designed specifically for aircraft operating lessors and capable of handling a significantly larger aircraft portfolio.

We believe that our current facilities, systems and personnel are capable of supporting an increase in our revenue base and asset base without a proportional increase in overhead costs.

Business Strategy

Our business approach is to continue to remain differentiated from those of other leasing companies which have orders with aircraft manufacturers.

Recent global disruptions have required enhanced focus on diligent, proactive risk monitoring while continuing to pursue our core strategies.

Our focus is to manage risk and secure liquidity while growing our assets and profits over the long term.

Our business approach is to continue to remain differentiated from other leasing companies that rely on large order books with aircraft manufacturers.

Recent global disruptions have required, and may continue to require, an enhanced focus on diligent and proactive risk monitoring, while continuing to pursue our core strategies.

Our focus is to actively manage risk, secure liquidity and maintain financial flexibility, while growing our assets and profits over the long term.

By limiting long-term capital commitments and maintaining a conservative capital structure, we seek to best position ourselves for future investment opportunities.

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We continually reevaluate investments across different aircraft models, ages, lessees and acquisition channels as market conditions and relative investment values change.

We believe our team’s experience with a wide range of asset types and the financing flexibility offered through unsecured debt provides us with a competitive advantage.

We view orders from aircraft manufacturers to be part of our investment opportunity set, however we have limited long-term capital commitments and are not reliant on orders for new aircraft from manufacturers as a source of new investments, as many of our competitors do.

We believe our team’s experience with a wide range of asset types and the financing flexibility provided by our access to unsecured debt gives us a competitive advantage.

We view orders from aircraft manufacturers to be part of our investment opportunity set;

however, we have limited long-term capital commitments and are not dependent on manufacturer order books as a primary source of growth, unlike many of our competitors.

Over the long term we plan to grow our business and profits while maintaining a conservative and flexible capital structure.

• Selling assets when attractive opportunities arise.

We sell assets with the aim of realizing profits and reinvesting proceeds.

We also use asset sales for portfolio management purposes, such as reducing lessee specific concentrations and lowering residual value exposures to certain aircraft types.

We sell assets with the aim of realizing value, generating gains and reinvesting proceeds into new investment opportunities.

We also use asset sales as an active portfolio management tool, including reducing lessee-specific concentrations and lowering residual value exposures to certain aircraft types.

• Maintaining efficient access to capital from a wide set of sources and leveraging our investment grade credit rating.

We believe the aircraft investment market is influenced by the business cycle.

Our strategy is to increase our purchase activity when prices are low and to emphasize asset sales when prices are high.

Our strategy is to increase acquisition activity when asset prices are low and to emphasize asset sales when prices are high.

To implement this approach, we believe it is important to maintain access to a wide variety of financing sources.

Since 2018, we have had an investment grade corporate credit rating and maintained strong portfolio and capital structure metrics while achieving critical size through accretive growth.

We believe our investment grade rating not only reduces our borrowing costs, but also facilitates more reliable access to both unsecured and secured debt capital throughout the business cycle.

Since 2018, we have had an investment grade corporate credit rating and maintained strong portfolio and capital structure metrics while achieving critical scale through accretive growth.

We believe our investment

grade rating lowers our borrowing costs and facilitates more reliable access to both unsecured and secured debt capital throughout the business cycle.

There can be no assurance, however, that we will be able to access capital on a cost-effective basis and our failure to do so could have a material adverse effect on our business, financial condition or results of operation.

• Leveraging our strategic relationships .

We intend to optimize the benefits provided through our extensive global contacts, as well as relationships maintained by our shareholders, Marubeni and Mizuho Leasing Company, Limited (“Mizuho Leasing” and together with Marubeni, our “Shareholders”), which have enabled greater access to Japanese-based financing sources and helped source and develop our joint venture.

• Capturing the value of our efficient operating platform and strong operating track record .

We believe our team’s capabilities in the global aircraft leasing market places us in a favorable position to explore new income-generating activities as capital becomes available for such activities.

We intend to continue to focus our efforts on investment opportunities in areas where we believe we have competitive advantages and on transactions that offer attractive risk-adjusted returns.

We intend to optimize the benefits provided through our extensive global industry relationships, as well as those maintained by our Shareholders.

These relationships enhance our access to Japanese-based financing sources and have supported the sourcing and development of our joint venture activities.

• Capturing the value of our efficient operating platform and proven operating track record .

We believe our team’s capabilities in the global aircraft leasing market positions us to explore new income-generating activities as capital becomes available.

We intend to continue focusing our efforts on investment opportunities where we believe we have competitive advantages and on transactions that offer attractive risk-adjusted returns.

• Maintaining a balanced and diversified lease portfolio.

We have a defined risk appetite articulated through our risk guardrails, which we use to manage portfolio risk and highlight areas where action to mitigate risk may be appropriate.

We operate within a defined risk appetite articulated through our risk guardrails, which are designed to manage portfolio risk and highlight areas where action to mitigate risk may be appropriate.

Our risk guardrails set limits on lessee concentration by risk rating, geographic concentrations, aircraft type concentrations, overall portfolio credit quality distribution, and lease maturity distribution.

We believe that our balanced and diversified fleet, as well as continued focus on portfolio concentration, has and will enable us to reduce the risks associated with the impact of adverse geopolitical and economic events.

We believe that our balanced and diversified fleet, together with disciplined portfolio management, has and will enable us to reduce the risks associated with the impact of adverse geopolitical and macroeconomic events.

Acquisitions and Sales

We originate acquisitions and sales through well-established relationships with other aircraft lessors, airlines, financial institutions, other aircraft owners, and aircraft manufacturers, as well as other sources.

We believe that sourcing such transactions globally through multiple channels provides for a broad and relatively consistent set of opportunities.

We believe that sourcing such transactions globally through multiple channels provides a broad, diversified and relatively consistent pipeline of opportunities.

During the year ended February 28, 2026, we acquired 46 aircraft for $1.7 billion and sold 33 aircraft and other flight equipment for net proceeds of $729.5 million.

We recognized gains on the sale or disposition of aircraft totaling $95.9 million.

Our objective is to develop and maintain a diverse operating lease portfolio.

We review our operating lease portfolio to manage our portfolio diversification and to sell aircraft when we believe selling will achieve better expected risk-adjusted cash flows than reinvesting in and re-leasing the aircraft.

Our objective is to develop, maintain and actively manage a diverse operating lease portfolio.

We regularly review our operating lease portfolio to optimize portfolio diversification and capital allocation, and to sell aircraft when we believe doing so will achieve more attractive risk-adjusted cash flows than reinvesting in and re-leasing the aircraft.

See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Overview — Acquisitions and Sales.”

We have an experienced acquisition and sales team based in the United States, Ireland and Singapore that maintains strong relationships with a wide variety of market participants throughout the world.

We believe that our seasoned personnel and extensive industry contacts facilitate our access to acquisition and sales opportunities and that our strong operating track record facilitates our access to debt and equity capital markets.

We believe that our seasoned personnel, global footprint and extensive industry contacts enhance our access to acquisition and sales opportunities, and that our strong operating track record supports reliable access to both debt and equity capital markets.

Potential investments and sales are evaluated by teams comprised of marketing, technical, risk management, finance and legal professionals.

These teams consider a variety of aspects before we commit to purchase or sell an aircraft, including price, specification/configuration, age, condition and maintenance history, operating efficiency, lease terms, financial condition and liquidity of the lessee, jurisdiction, industry trends and future redeployment potential and values.

We believe that utilizing a cross-functional team of experts to consider investment parameters helps us assess more completely the overall risk-adjusted returns of potential acquisitions and helps us move forward expeditiously on letters of intent and acquisition documentation.

We operate in a capital-intensive industry and have a demonstrated track record of raising substantial amounts of capital from debt and equity investors.

We believe that cash on hand, funds generated from operations, maintenance payments received from lessees, equity offerings, unsecured bond offerings, borrowings secured by our aircraft, draws under our revolving credit facilities and proceeds from any future aircraft sales will be sufficient to satisfy our liquidity and capital resource needs over the next 12 months.

These teams consider a variety of factors before we commit to purchase or sell an aircraft, including price, specification and configuration, age, condition and maintenance history, operating efficiency, lease terms, financial condition and liquidity of the lessee, jurisdiction, industry trends and future redeployment potential and values.

We believe that utilizing a cross-functional team of experts to consider investment parameters helps us to more comprehensively assess risk-adjusted returns of potential acquisitions and to execute transactions efficiently, including progressing expeditiously on letters of intent and acquisition documentation.

We operate in a capital-intensive industry and have a demonstrated track record of consistently raising substantial capital from both debt and equity investors.

We believe that our liquidity sources, including cash on hand, funds generated from operations, maintenance payments received from lessees, equity offerings, unsecured bond offerings, borrowings secured by our aircraft, draws under our revolving credit facilities and proceeds from any future aircraft sales,

will be sufficient to satisfy our liquidity and capital resource needs over the next 12 months.

We may choose to repay all or a portion of such borrowings from time to time with the net proceeds from subsequent long-term debt financings, additional equity offerings or cash generated from operations and asset sales.

Our ability to execute our business strategy, particularly the acquisition of additional commercial jet aircraft or other aviation assets, depends to a significant degree on our ability to obtain additional debt and equity capital on terms we deem attractive.

Our ability to execute our business strategy, particularly the acquisition of additional commercial jet aircraft or other aviation assets, depends to a significant degree on maintaining continued access to debt and equity capital on terms we deem attractive.

See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources.”

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Aircraft Leases

Our aircraft are net leases whereby we retain the benefit and bear the risk of re-leasing and of the residual value of the aircraft at the end of the lease.

Leasing can be an attractive alternative to ownership for an airline because leasing increases an airline’s fleet flexibility, requires lower capital commitments, and reduces aircraft residual value risks for the airline.

Typically, the lessee agrees to lease an aircraft for a fixed term, although certain of our leases allow the lessee the option to extend the lease for an additional term or, in rare cases, terminate the lease prior to its expiration.

Our aircraft are generally leased under net leases, pursuant to which we retain the benefits and bear the risks associated with re-leasing the aircraft and the residual value of the aircraft at the end of the lease.

Leasing can be an attractive alternative to ownership for airlines, as it provides greater fleet flexibility, requires lower upfront capital commitments, and reduces aircraft residual value risks.

Typically, the lessee agrees to lease an aircraft for a fixed term, although certain of our leases allow the lessee the option to extend the lease for an additional term or, in limited cases, to terminate the lease prior to its scheduled expiration.

Our leases require the lessee to pay periodic rentals during the lease term.

Approximately 98% of our leases have fixed rental rates

that are payable monthly in advance in U.S.

For our variable rate leases, rentals are payable on a floating interest-rate basis using the secured overnight financing rate (“SOFR”).

Approximately 99% of our leases have fixed rental rates that are payable monthly in advance in U.S.

For variable-rate leases, rentals are payable on a floating interest-rate basis using the secured overnight financing rate (“SOFR”).

Generally, we receive a cash deposit or letter of credit as security for the lessee’s performance of its obligations under the lease.

Under our leases, the lessee must pay operating expenses payable or accrued during the term of the lease, which normally include maintenance, overhaul, fuel, crew, landing, airport and navigation charges, certain taxes, licenses, consents and approvals, aircraft registration and insurance premiums.

Many of our leases also contain provisions requiring us to pay a portion of the cost of modifications to the aircraft performed by the lessee at its expense if such modifications are mandated by recognized airworthiness authorities.

The lessees are obliged to remove liens on the aircraft other than liens permitted under the leases.

Typically, the lessee is responsible for performing maintenance on the aircraft and is required to make payments for heavy maintenance, overhaul or replacement of certain high-value components of the aircraft.

These maintenance payments are based on hours or cycles of utilization or on calendar time, depending upon the component, and are either made monthly in arrears or at the end of the lease term.

Under our leases, the lessee is responsible for paying operating expenses incurred or accrued during the term of the lease, which typically include maintenance, overhaul, fuel, crew, landing, airport and navigation charges, certain taxes, licenses, consents and approvals, aircraft registration and insurance premiums.

Many of our leases also contain provisions requiring us to pay a portion of the cost of aircraft modifications performed by the lessee at its expense where such modifications are mandated by recognized airworthiness authorities.

The lessees are obliged to remove any liens on the aircraft, other than liens permitted under the leases.

In general, the lessee is responsible for performing maintenance on the aircraft and is required to make payments for heavy maintenance, overhaul or replacement of certain high-value components.

These maintenance payments are typically calculated based on hours or cycles of utilization or on calendar time, depending upon the applicable component, and are made either monthly in arrears or at the end of the lease term.

Our determination of whether to require such payments to be made monthly or to permit a lessee to make a single maintenance payment at the end of the lease term depends on a variety of factors, including the creditworthiness of the lessee, the amount of security deposit provided by the lessee and market conditions at the time we enter into the lease.

If a lessee is making monthly maintenance payments, we would typically be obligated to use funds paid by the lessee during the lease term to reimburse the lessee for costs they incur for heavy maintenance, overhaul or replacement of certain high-value components, usually following completion of the relevant work.

If a lessee makes a single end of lease maintenance payment, the lessee would typically be required to pay us for its utilization of the aircraft during the lease.

In some cases, however, we may owe a net payment to the lessee in the event heavy maintenance is performed and paid for by the lessee and the aircraft is returned to us in better condition than at lease inception.

Our leases generally provide that the lessees’ payment obligations are absolute and unconditional under any and all circumstances and require lessees to make payments without withholding payment on account of any amounts the lessor may owe the lessee or any claims the lessee may have against the lessor for any reason, except that under certain of the leases a breach of quiet enjoyment by the lessor may permit a lessee to withhold payment.

The leases also generally include an obligation of the lessee to gross up payments under the lease where lease payments are subject to withholding and other taxes, although there may be some limitations to the gross up obligation, including provisions which do not require a lessee to gross up payments if the withholdings arise out of our ownership or tax structure.

Where a lessee makes monthly maintenance payments, we are generally obligated to use such funds to reimburse the lessee for costs they incur for eligible heavy maintenance, overhaul or replacement of certain high-value components during the lease term, typically following completion of the relevant work.

Where a lessee makes a single end of lease maintenance payment, the lessee would typically be required to compensate us for its utilization of the aircraft during the lease.

In some cases, however, we may owe a net payment to the lessee if heavy maintenance is performed and paid for by the lessee and the aircraft is returned to us in better condition than at lease inception.

Our leases generally provide that the lessees’ payment obligations are absolute and unconditional under any and all circumstances and require payments to be made without set-off, withholding or counterclaim for any amounts the lessor may owe the lessee or for any claims the lessee may have against the lessor for any reason.

Certain leases provide limited exceptions, including where a breach of quiet enjoyment by the lessor may permit a lessee to withhold payment.

provisions which do not require a lessee to gross up payments if the withholdings arise out of our ownership or tax structure.

In addition, changes in law may result in the imposition of withholding and other taxes and charges that are not reimbursable by the lessee under the lease or that cannot be reimbursed under applicable law.

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A330-200/300 — 2 — 5 1 4 — — — — — — — — 12

737-700/800/900ER 4 4 9 5 9 7 — — 2 3 1 — — 2 46

737-700/800 — 9 8 11 8 1 3 3 4 2 1 — — 1 51

737-MAX8/MAX9 — — — — 1 1 4 3 3 1 4 6 — — 23

777-300ER — — — — — — 1 — — — — — — — 1

E195 4 1 — — — — — — — — — — — — 5

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Lease Management and Remarketing

Our aircraft re-leasing strategy is to develop opportunities proactively, well in advance of scheduled lease expiration.

This enables consideration of a broad set of alternatives, including deployment, sale or part-out, and to allow for reconfiguration or maintenance lead times where needed.

We also take a proactive approach to monitoring the credit quality of our customers and may seek early return and redeployment of aircraft if we feel that a lessee is unlikely to perform its obligations under a lease.

We have invested significant resources in developing and implementing modern, efficient lease management information systems and processes to enable effective management of aircraft in our portfolio.

Our aircraft re-leasing strategy is focused on proactively developing opportunities well in advance of scheduled lease expirations.

This approach allows us to evaluate a broad set of alternatives, including redeployment, sale or part-out, and to allow for reconfiguration or maintenance lead times where needed.

We also proactively monitor the credit quality of our customers and may seek early return and redeployment of aircraft if we feel that a lessee is unlikely to perform its obligations under a lease.

In addition, we have invested significant resources in developing and implementing modern, efficient lease management information systems and processes to support the effective management and remarketing of aircraft within our portfolio.

Portfolio Risk Management

Our objective is to build and maintain a lease portfolio that is balanced and diversified and delivers returns commensurate with risk.

We have a defined risk appetite to assist in portfolio risk management and highlight areas where action to mitigate risk may be appropriate, and take into account the following:

Our objective is to build and maintain a balanced and diversified lease portfolio that delivers returns commensurate with risk.

We have a defined risk appetite framework to support portfolio risk management and to identify areas where actions to mitigate risk may be appropriate, taking into account the following:

• individual lessee exposures;

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• lease maturity distribution.

We have a risk management team that undertakes detailed due diligence on lessees when aircraft are acquired with a lease already in place and for placement of aircraft with new lessees following lease expiration or termination.

They also monitor the portfolio on an ongoing basis.

We have a dedicated risk management team that performs detailed due diligence on lessees when aircraft are acquired with a lease already in place and for placement of aircraft with new lessees following lease expiration or termination.

The risk management team also monitors the portfolio on an ongoing basis.

Other Aviation Assets and Alternative New Business Approaches

We believe investment opportunities may arise in related areas such as financing secured by commercial jet aircraft as well as jet engine and spare parts leasing, trading and financing.

In the future, we may make opportunistic investments in these or other sectors or in other aviation-related assets, and we intend to continue to explore other income-generating activities and investments.

We believe investment opportunities may arise in related areas, including financing secured by commercial jet aircraft, as well as jet engine and spare parts leasing, trading and financing.

From time to time, we have made, and may continue to make opportunistic investments in these or other sectors or in other aviation-related assets, and we intend to continue to explore other income-generating activities and investments opportunities.

We source and service investments for our joint venture, to which we provide marketing, asset management and administrative services.

We are paid market-based fees for these services, which are recorded in other revenue in our consolidated statements of income.

We believe we have a world class servicing platform and may also pursue opportunities to capitalize on these capabilities such as providing aircraft management services for third party aircraft owners.

We believe we have a world class servicing platform and may also pursue opportunities to capitalize on these capabilities, including providing aircraft management services for third party aircraft owners.

The aircraft leasing and trading industry is highly competitive with a significant number of active participants.

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Competition for aircraft acquisitions comes from many sources, ranging from large established aircraft leasing companies to smaller players and new entrants.

Competition for leasing, re-leasing and selling aircraft is based upon the availability, type and condition of the aircraft, user base, lease rates, prices, and other lease terms.

Competition for leasing, re-leasing and selling aircraft is based upon a number of factors, including aircraft availability, type and condition, operator base, customer relationships, lease rates, pricing, and other lease terms.

Aircraft manufacturers, leasing companies, airlines and other operators, distributors, equipment managers, financial institutions and other parties engaged in leasing, managing, marketing or remarketing aircraft compete with us, although their focus may be on different market segments and aircraft types.

Larger lessors are generally more focused on acquiring new aircraft via direct orders with the OEMs and through purchase lease-back transactions with airlines.

These larger lessors include AerCap Holdings, SMBC Aviation Capital, Avolon Holdings, Air Lease Corporation, BBAM and BOC Aviation.

Competition for mid-aged and older aircraft comes from other competitors that, in many cases, rely on private equity or hedge fund capital sources.

These larger lessors include AerCap Holdings, SMBC Aviation Capital, Avolon Holdings, Air Lease Corporation, Dubai Aerospace Enterprise, Aviation Capital Group and BOC Aviation.

Competition for mid-aged and older aircraft comes from other competitors that, in many cases, rely on private equity, hedge fund or other alternative capital sources.

Such competitors include Carlyle Aviation Partners, Castlelake and other players, including new entrants, funded by alternative investment funds and companies.

These companies are typically fund-based, rather than having permanent capital structures, and have benefited from the availability of debt financing for mid-aged aircraft.

Some of these companies have also set up permanent capital structures to be able to access the unsecured debt market.

These companies are typically fund-based, rather than supported by permanent capital structures and have benefited from the availability of debt financing for mid-aged aircraft, although some have also established permanent capital structures to access the unsecured debt markets.

Some of our competitors have greater financial resources and/or a lower cost of capital.

A number of them commit to speculative orders of new aircraft to be placed on operating lease upon delivery from the manufacturer, which compete with new and used aircraft offered by other lessors.

The aircraft leasing industry is characterized by on-going merger and acquisition activity as well as new entrants as barriers to entry into the industry are relatively low.

We believe that we can compete favorably in aircraft acquisition, leasing and sales activities due to the reputation of our team of experienced professionals, extensive market contacts and expertise in effectively sourcing and acquiring aircraft.

We also believe our access to unsecured debt provides us with a competitive advantage in pursuing investments quickly and reliably and in acquiring aircraft in situations where it may be more difficult to finance on a secured, non-recourse basis.

We require our lessees to carry general third-party legal liability insurance, all-risk aircraft hull and spares insurance (both with respect to the aircraft and with respect to each engine or part when not installed on our aircraft);

war-risk hull and spares insurance;

and excess war liability insurance.

A number of competitors place speculative orders for new aircraft to be leased upon delivery from the manufacturer, which compete with both new and used aircraft offered by other lessors.

The aircraft leasing industry is also characterized by ongoing merger and acquisition activity and new entrants, as barriers to entry are relatively low.

We believe we compete favorably in aircraft acquisition, leasing and sales activities due to the reputation of our experienced team, extensive market relationships and demonstrated ability to source and acquire aircraft effectively.

We also believe our access to unsecured debt provides a competitive advantage by enabling us to pursue investment opportunities quickly and reliably, including in situations where secured, non-recourse financing may be less readily available.

We are named as an additional insured on liability insurance policies carried by our lessees, and we or one of our lenders will be designated as a contract party/loss payee in the event of a total loss of the aircraft.

We maintain contingent and possessed hull, war, excess war and legal and liability insurance coverage with respect to our aircraft which provides coverage when our equipment is not on lease or where a lessee party fails to indemnify us.

this is intended to provide coverage for certain risks, including where a lessee’s insurance fails, but excluding coverage for other risks such as the risk of insolvency of the primary insurer or reinsurer.

This coverage is intended to protect against certain risks, including where a lessee’s insurance fails, but excluding coverage for other risks such as the risk of insolvency of the primary insurer or reinsurer.

Not all losses are covered by insurance and in some cases, the insurers also have maximum limits (aggregate limits) on amounts payable.

We maintain insurance policies to cover non-aviation risks related to physical damage to our equipment and property, as well as with respect to third-party liabilities arising through the course of our normal business operations (other than aircraft operations).

We also maintain limited business interruption insurance to cover a portion of the costs we would expect to incur in connection with a disruption to our main facilities, and we maintain directors’ and officers’ liability insurance providing coverage for liabilities related to the service of our directors, officers and certain employees.

We also maintain limited business interruption insurance designed to cover a portion of the costs we would expect to incur in connection with a disruption to our main facilities, and we maintain directors’ and officers’ liability insurance providing coverage for liabilities related to the service of our directors, officers and certain employees.

Consistent with industry practice, our insurance policies are generally subject to deductibles or self-retention amounts.

Recent geopolitical events, such as the ongoing Russia-Ukraine conflict, have led insurers to reassess their coverage and significantly increase premiums.

In addition, we have claims arising from the Russian invasion of Ukraine which remain unsettled and in respect of which we have had to resort to litigation that may take years to fully settle, if at all.

We believe that the insurance coverage currently carried by our lessees and by Aircastle is consistent with industry

practice and provides adequate protection against the accident-related and other covered risks involved in the conduct of our business.

Geopolitical events and regional conflicts have, in recent years, led insurers to reassess their coverage and significantly increase premiums.

In addition, insurance claims arising from geopolitical events may remain unsettled and, in some cases, may be subject to dispute resolution or litigation, which could take years to resolve, if at all.

We believe that the insurance coverage currently carried by our lessees and by Aircastle is consistent with industry practice and provides adequate protection against the accident-related and other covered risks involved in the conduct of our business.

However, there can be no assurance that we have adequately insured against all risks, that lessees will at all times comply with their obligations to maintain insurance, that our lessees’ insurers and re-insurers will be or will remain solvent and able to satisfy any claims, that any particular claim will ultimately be paid or that we or our lessees will be able to procure adequate insurance coverage at commercially reasonable rates in the future.

Furthermore, war risk insurance may be automatically cancelled as a result of certain events outside our control, including in the event of hostilities between the United Kingdom, the United States, France, Russia and China.

Corporate Responsibility

Furthermore, war risk insurance may be automatically cancelled as a result of certain events outside our control, including the escalation of armed conflict or geopolitical instability.

Corporate Responsibility and Sustainability

We believe that our commitment to identifying and implementing positive environmental and social related business practices strengthens our Company, and better serves our customers, our communities and the broader environment within which we conduct our business.

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The Company believes the operations of our customers could be affected by the potential impacts of both climate change and sustainability targets and initiatives aimed at curbing its effect, so we are committed to monitoring sustainability developments.

The Company’s long-term strategic plan takes these rapidly developing initiatives into consideration when we evaluate the technology behind the aircraft we target for investment.

For the year ended February 28, 2025, 57% of our incremental net book value acquired were new technology aircraft with higher efficiency and lower emissions.

The Company’s long-term strategic plan takes these rapidly developing initiatives into

consideration when we evaluate the technology behind the aircraft we target for investment.

For the year ended February 28, 2026, 63% of our incremental net book value acquired was new technology aircraft with higher efficiency and lower emissions.

Although the Company continues to increase the new technology portion of our fleet, it is understood that manufacturer output is below the global market’s demand for new aircraft.

Technical challenges to certain engine types that service new aircraft types also have extended the lives of current technology aircraft.

In addition, the Company is an investment partner in the United Airlines Ventures’ Sustainable Flight Fund whose objective is scaling up the availability of SAF.

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Aircastle itself is generally not directly subject to most air transportation regulations as we do not operate aircraft.

In contrast, our lessees are subject to extensive, direct regulation under the laws of the jurisdictions in which they are registered and where they operate.

By contrast, our lessees are subject to extensive, direct regulation under the laws of the jurisdictions in which they are registered and where they operate.

Such laws govern, among other things, the registration, operation, security, and maintenance of our aircraft, environmental issues and the financial oversight of their operations.

Regulations, such as those limiting CO 2 emissions and reducing noise, are changing and developing in the aviation sector, where there is an additional international angle to the regulation.

The impact of these items on the airline sector, as well as recent crises, such as the COVID-19 pandemic, the Russian invasion of Ukraine and the conflict in the Middle East, have further complicated matters.

Further regulatory changes can be expected in the future.

Regulatory requirements applicable to the aviation industry, including those relating to carbon emissions, sustainability initiatives and aircraft noise, continue to evolve and, in many cases, involve an international regulatory

The impact of these regulatory developments on the airline sector, together with broader global events and periods of industry disruption, has increased regulatory complexity and uncertainty.

Additional regulatory changes affecting the aviation industry may occur in the future, the scope and impact of which are difficult to predict.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business