What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-07-31 compared with 2025-05-05 · 231 added, 138 removed, 256 unchanged (59% of the section changed)

7 unchanged sentences

Refurbishing our own engines, modules and parts at significant scale incentivizes us to conduct repairs as efficiently as possible, which we believe creates a large opportunity to provide a low-cost, flexible, customer-driven alternative to engine maintenance for airlines and lessors worldwide.

As of March 31, 2025, we had total consolidated assets of $4.3 billion and total equity of $28.3 million.

As of June 30, 2025, we had total consolidated assets of $4.1 billion and total equity of $164.9 million.

Internalization of Management

On May 28, 2024, the Company entered into definitive agreements with the Former Manager and Master GP to internalize the Company’s management function.

As part of the termination of the Management Agreement, the Company (i) agreed to pay the Former Manager (for itself and on behalf of the Master GP, as applicable) the Cash Consideration, the compensation accrued and payable, but not yet paid, under the Management Agreement and the expenses that were reimbursable, but not yet reimbursed, under the Management Agreement;

As part of the termination of the Management Agreement, the Company (i) paid the Former Manager (for itself and on behalf of the Master GP, as applicable) the Cash Consideration, the compensation accrued and payable, but not yet paid, under the Management Agreement and the expenses that were reimbursable, but not yet reimbursed, under the Management Agreement;

(ii) issued to the Former Manager (for itself and on behalf of the Master GP, as applicable) the Share Consideration;

3 unchanged sentences

Under the Transition Services Agreement, the Former Manager was required to continue to provide the Company and its affiliates with all of the Services for a transition period until October 31, 2024, during which the Company procured replacements for the Services.

In addition, the Former Manager was required to continue to provide the services that were reasonably required by the Company to prepare its quarterly and annual financial statements until May 31, 2025.

The Services were provided to the Company for a fee equal to the Former Manager’s cost of providing the Services, including the allocated cost of, among other things, overhead, employee wages and compensation, rent and related real estate expenses and actually incurred out-of-pocket expenses, plus a mark-up of ten percent (10%).

The Company was required to use commercially reasonable efforts to make available to the Former Manager certain employees of the Company who were previously employees of the Former Manager to provide the Reverse Services, subject to certain exceptions.

In addition, the Former Manager is required to continue to provide the services that are reasonably required by the Company to prepare its quarterly and annual financial statements until May 31, 2025.

The Company is required to continue to provide the Reverse Services until the later to occur of the dissolution or sale of the entities receiving Reverse Services.

The Transition Services Agreement may be terminated earlier (x) by mutual agreement of the parties, (y) by either the Former Manager or the Company in the event of a material breach by the non-terminating party that is not cured within thirty (30) days following written notification thereof, or (z) by the Former Manager if the Company fails to pay any undisputed sum overdue and payable for a period of at least thirty (30) days.

Impact of Russia’s Invasion of Ukraine

3 unchanged sentences

As a result, we recognized an impairment charge totaling $120.0 million, net of maintenance deposits for the year ended December 3 1, 2022, to write-off the entire carrying value of leasing equipment assets that we did not expect to recover from Ukraine and Russia.

As of March 31, 2025, eight aircraft and seventeen engines were still located in Russia.

As of June 30, 2025, eight aircraft and seventeen engines were still located in Russia.

Our lessees are required to provide insurance coverage with respect to leased aircraft and engines, and we are named as insureds under those policies in the event of a total loss of an aircraft or engine.

9 unchanged sentences

The Company has agreed that the 2025 Partnership, and follow-on partnerships, will be the primary buyer of on-lease 737NG and A320ceo aircraft.

The Company, as the General Partner, will manage the aircraft in the 2025 Partnership, and the Company will receive customary, market-based compensation.

The Company, as the Servicer, will manage the aircraft in the 2025 Partnership, and the Company will receive customary, market-based compensation.

The Company has also made a minority investment and will make future investments in the 2025 Partnership.

15 unchanged sentences

Adjusted EBITDA is defined as net income (loss) attributable to shareholders from continuing operations, adjusted (a) to exclude the impact of provision for (benefit from) income taxes, equity-based compensation expense, acquisition and transaction expenses, losses on the modification or extinguishment of debt and preferred shares and capital lease obligations, changes in fair value of non-hedge derivative instruments, asset impairment charges, incentive allocations, depreciation and amortization expense, dividends on preferred shares and interest expense, internalization fee to affiliate, (b) to include the impact of our pro-rata share of Adjusted EBITDA from unconsolidated entities and (c) to exclude the impact of equity in earnings (losses) of unconsolidated entities and the non-controlling share of Adjusted EBITDA, if any.

Comparison of the three months ended March 31, 2025 and 2024

Comparison of the three and six months ended June 30, 2025 and 2024

The following table presents our consolidated results of operations:

Three Months Ended March 31, Change

Three Months Ended June 30, Change Six Months Ended

June 30, Change

(in thousands) 2025 2024 2025 2024

Aerospace products revenue $ 420,686 $ 245,200 $ 175,486 $ 685,111 $ 434,257 $ 250,854

$ 365,063 $ 189,057 $ 176,006

MRE Contract revenue 69,585 — $ 69,585 170,223 — $ 170,223

Lease income 62,439 70,754 (8,315) 130,879 123,915 6,964

1 unchanged sentence

Asset sales revenue 47,915 72,433 (24,518) 66,854 111,040 (44,186)

Other revenue (1)

2,508 4,020 (1,512) 2,539 4,099 (1,560)

Total revenues 676,237 443,594 232,643 1,178,317 770,288 408,029

4 unchanged sentences

Management fees and incentive allocation to affiliate — 3,554 (3,554) — 8,449 (8,449)

Internalization fee to affiliate — 300,000 (300,000) — 300,000 (300,000)

Depreciation and amortization 55,236 56,691 (1,455) 114,798 106,611 8,187

5 unchanged sentences

(5,003) (694) (4,309) (12,617) (1,361) (11,256)

Other income (3)

43,941 634 43,307

Loss on extinguishment of debt — (13,920) 13,920 — (13,920) 13,920

Gain on sale to the 2025 Partnership 34,604 — 34,604 45,474 — 45,474

Other income (expense) 27,156 (498) 27,654 60,227 136 60,091

Total other expense (7,208) (70,308) 63,100 (32,921) (118,048) 85,127

Income before income taxes 125,245 45,194 80,051

Provision for income taxes 22,859 5,572 17,287

Net income 102,386 39,622 62,764

Income (loss) from before income taxes 203,276 (232,903) 436,179 328,521 (187,709) 516,230

Provision for (benefit from) income taxes 37,878 (13,033) 50,911 60,737 (7,461) 68,198

Net income (loss) 165,398 (219,870) 385,268 267,784 (180,248) 448,032

Dividends on preferred shares 3,709 8,335 (4,626) 9,824 16,670 (6,846)

Loss on redemption of preferred shares — — — 6,327 — 6,327

Net income attributable to shareholders $ 89,944 $ 31,287 $ 58,657

Net income (loss) attributable to shareholders $ 161,689 $ (228,205) $ 389,894 $ 251,633 $ (196,918) $ 448,551

______________________________________________________

(1) Includes revenue of $100,638 and $0 for the three months ended March 31, 2025 and 2024, respectively, for sales to the 2025 Partnership.

See Note 11 for additional information.

(2) Includes the profit elimination of $(6,950) and $0 for the three months ended March 31, 2025 and 2024, respectively, for sales to the 2025 Partnership.

(3) Includes gain on sale of $10,870 and $0 for the three months ended March 31, 2025 and 2024, respectively, for sales to the 2025 Partnership.

The following table sets forth a reconciliation of net income attributable to shareholders to Adjusted EBITDA:

Three Months Ended March 31, Change

(1) Includes servicing fees of $2,052 and $2,600 for the three and six months ended June 30, 2025, respectively, from the 2025 Partnership

(2) Includes the profit elimination of $(4,935) and $(11,885) for the three and six months ended June 30, 2025, respectively, and $0 and $0 for the three and six months ended June 30, 2024, respectively, for sales to the 2025 Partnership.

The following table sets forth a reconciliation of net income (loss) attributable to shareholders to Adjusted EBITDA:

Three Months Ended June 30, Change Six Months Ended

June 30, Change

(in thousands) 2025 2024 2025 2024

Net income attributable to shareholders $ 89,944 $ 31,287 $ 58,657

Provision for income taxes 22,859 5,572 17,287

Net income (loss) attributable to shareholders $ 161,689 $ (228,205) $ 389,894 $ 251,633 $ (196,918) $ 448,551

Provision for (benefit from) income taxes 37,878 (13,033) 50,911 60,737 (7,461) 68,198

Equity-based compensation expense 5,515 638 4,877 10,404 1,148 9,256

7 unchanged sentences

Interest expense and dividends on preferred shares 67,674 63,531 4,143 135,829 119,573 16,256

Internalization fee to affiliate — 300,000 (300,000) — 300,000 (300,000)

Pro-rata share of Adjusted EBITDA from unconsolidated entities (2)

4,815 (617) 5,432 4,856 (1,165) 6,021

Equity in losses of unconsolidated entities (3)

68 694 (626) 732 1,361 (629)

Non-controlling share of Adjusted EBITDA — — — — — —

1 unchanged sentence

________________________________________________________

(1) Includes the following items for the three months ended March 31, 2025 and 2024:

(1) Includes the following items for the three months ended June 30, 2025 and 2024:

(i) depreciation and amortization expense of $55,236 and $56,691, (ii) lease intangible amortization of $2,153 and $3,786 and (iii) amortization for lease incentives of $8,288 and $5,332, respectively.

(2) Includes the following items for the three months ended March 31, 2025 and 2024:

(i) net loss of $664 and $667 , (ii) depreciation and amortization expense of $158 and $119, and (iii) acquisition and transaction expenses of $547 and $0, respectively.

(3) Excludes the profit elimination of $6,950 and $0 for the three months ended March 31, 2025 and 2024, respectively, for sales to the 2025 Partnership.

Comparison of the three months ended March 31, 2025 and 2024

Includes the following items for the six months ended June 30, 2025 and 2024:

(i) depreciation and amortization expense of $114,798 and $106,611, (ii) lease intangible amortization of $5,359 and $7,762 and (iii) amortization for lease incentives of $13,907 and $10,558, respectively.

(2) Includes the following items for the three months ended June 30, 2025 and 2024:

(i) net loss of $68 and $694, (ii) interest expense of $1,490 and $0, (iii) depreciation and amortization expense of $3,470 and $77, and (iv) acquisition and transaction expenses of $(77) and $0, respectively.

Includes the following items for the six months ended June 30, 2025 and 2024:

(i) net loss of $732 and $1,361, (ii) interest expense of $1,490 and $0, (iii) depreciation and amortization expense of $3,628 and $196, and (iv) acquisition and transaction expenses of $470 and $0, respectively.

(3) Excludes the profit elimination of $4,935 and $11,885 for the three and six months ended June 30, 2025, respectively, and $0 and $0 for the three and six months ended June 30, 2024, respectively, for sales to the 2025 Partnership.

Comparison of the three months ended June 30, 2025 and 2024

Total revenues increased by $232.6 million, driven by the following:

• Aerospace products revenue increased by $176.0 million, prima rily due to a $165.2 million increase in CFM56-5B, CFM56-7B and V2500 engine and module sales including to the 2025 Partnership, as well as a $10.7 million increase in other revenues from QuickTurn and LMCES.

• Aerospace products revenue increased by $175.5 million, primarily due to a $172.1 million increase in CFM56-5B, CFM56-7B and V2500 engine and module sales, as well as a $3.2 million increase in other maintenance service revenues.

• MRE Contract revenue increased by $69.6 million, primarily due to an increase in CFM56-5B and CFM56-7B engine and module sales made to the 2025 Partnership.

• Maintenance revenue increased by $21.9 million, primarily due to an increase in aircraft maintenance revenue of $23.1 million driven by an increase in utilization and higher maintenance reserves taken into revenue, partially offset by the sale of Seed Assets to the 2025 Partnership.

• Asset sales revenue decreased by $24.5 million, primarily due to an overall decrease in the number of sales transactions of commercial aircraft and engines.

Specifically, one engine sold in Q2 2025 as compared to six engines sold in Q2 2024.

• Lease income decreased by $8.3 million, primarily due to a decrease of $10.0 million in the Offshore Energy business driven by the sale of the two vessels during Q4 2024 and a decrease in aircraft lease revenue of $2.4 million driven by the sale of Seed Assets to the 2025 Partnership.

This was partially offset by an increase in engine lease revenue of $4.1 million.

• Other revenue decreased by $1.5 million, primarily due to the sale of the two vessels during Q4 2024 in the Offshore Energy business.

Comparison of the six months ended June 30, 2025 and 2024

Total revenues increased by $408.0 million, driven by the following:

• Aerospace products revenue increased $250.9 million, primarily due to a $237.0 million increase in CFM56-5B, CFM56-7B and V2500 engine and module sales, as well as a $11.9 million increase in other maintenance service revenues.

• MRE Contract revenue increased by $170.2 million, primarily due to an increase in CFM56-5B and CFM56-7B engine and module sales made to the 2025 Partnership.

• Maintenance reve nue increased by $25.7 million, primarily due to an increase in aircraft maintenance revenue of $24.7 million driven by an increase in utilization and higher maintenance reserves taken into revenue, partially offset by the sale of Seed Assets to the 2025 Partnership.

• Lease income increased by $7.0 million, primarily due to an increase in aircraft lease revenue of $9.2 million and an increase in engine lease revenue of $10.1 million, driven by an increased number of aircraft and engines on lease in addition to higher rental rates.

This was partially offset by a decrease of $12.3 million in the Offshore Energy business driven by the sale of the two vessels during Q4 2024.

• Maintenance reve nue increased by $3.8 million, primarily due to an increase in aircraft maintenance revenue of $1.6 million and an increase in engine maintenance revenue of $2.2 million, driven by an increased number of aircraft and engines on lease in Q1 2025 as compared to Q1 2024.

• Asset sales revenue decreased by $44.2 million, primarily due to an overall decrease in the number of sales transactions of commercial aircraft and engines.

Specifically, there were no aircraft and no engines sold in Q1 2025 as compared to four engines sold in Q1 2024.

Comparison of the three months ended March 31, 2025 and 2024

Total expenses increased by $117.4 million, driven by the following:

Specifically, one engine sold in 2025 as compared to 10 engines sold in the prior-year period.

• Other revenue decreased by $1.6 million, primarily due to the sale of the two vessels during Q4 2024 in the Offshore Energy business.

Comparison of the three months ended June 30, 2025 and 2024

Total expenses decreased by $140.4 million, driven by the following:

• Internalization fee to affiliate decreased by $300.0 million relating to the Internalization effective May 28, 2024.

• Depreciation and amortization decreased by $1.5 million, primarily driven by the increase of assets held-for-sale and the sale of Seed Assets to the 2025 Partnership.

• Acquisition and transaction expenses decreased by $3.5 million primarily due to lower professional fees associated with the Internalization and the sale of the Offshore Energy vessels.

• Management fees and incentive allocation to affiliate decreased by $3.6 million, due to no management and incentive fees paid to the Former Manager during 2025, with the Internalization effective May 28, 2024 .

• Cost of sales increased by $163.4 million, primarily due to increases in CFM56-5B, CFM56-7B and V2500 engine and module sales, and parts inventory sales, which directly corresponds to components of increases in Aerospace products revenue over the same period.

This was partially offset by a decrease of $11.9 million, primarily due to an overall decrease in the number of sales transactions of engines, which is in line with an overall decrease in the corresponding asset sales revenue.

• Operating expenses increased by $7.1 million, primarily due to higher compensation and benefits expense due to the increase in employee headcount primarily due to the acquisition of LMCES in the third quarter of 2024.

• Depreciation and amortization increased by $9.6 million, primarily driven by an increase in the number of assets owned and on lease during the quarter, partially offset by an increase in the number of aircraft redelivered and parted out into our engine leasing pool.

• Acquisition and transaction expenses increased by $1.1 million, primarily due to higher professional fees incurred in evaluating and completing strategic transactions.

• Management fees and incentive allocation to affiliate decreased by $4.9 million, due to a decrease in management and incentive fees to the Former Manager during 2024, with the Internalization effective May 28, 2024 .

This was partially offset by a decrease of $7.2 million, primarily due to an overall decrease in the number of sales transactions of commercial aircraft and engines, which is in line with an overall decrease in the corresponding asset sales revenue.

• Operating expenses increased by $5.2 million, primarily due to higher compensation and benefits expense due to an increase in employee headcount and increased overall compensation.

Comparison of the six months ended June 30, 2025 and 2024

Total expenses decreased by $23.1 million, driven by the following:

• Internalization fee to affiliate decreased by $300.0 million relating to the Internalization effective May 28, 2024.

• Management fees and incentive allocation to affiliate decreased by $8.4 million, due to no management and incentive fees paid to the Former Manager during 2025, with the Internalization effective May 28, 2024 .

• Acquisition and transaction expenses decreased by $2.4 million, primarily due to lower professional fees associated with the Internalization and the sale of the Offshore Energy vessels.

• Cost of sales increased by $269.3 million, primarily due to increases in CFM56-5B, CFM56-7B and V2500 engine and module sales, and parts inventory sales, which directly corresponds to components of increases in Aerospace products revenue over the same period.

This was partially offset by a decrease of $19.1 million, primarily due to an overall decrease in the number of sales transactions of commercial aircraft and engines, which is in line with an overall decrease in the corresponding asset sales revenue.

• Operating expenses increased by $12.4 million, primarily due to higher compensation and benefits expense due to an increase in employee headcount and increased overall compensation.

• Depreciation and amortization increased by $8.2 million, primarily driven by an increase in the number of assets owned and on lease during the period, partially offset by an increase of assets held-for-sale and the sale of Seed Assets to the 2025 Partnership.

Other (expense) income

Total other expense decreased by $22.0 million, due to the following:

• Interest expense increased by $14.3 million, reflecting an increase in the average debt outstanding of approximately $955.7 million primarily due to increases in (i) the Senior Notes due 2031 of $700.0 million, which were issued in April 2024, (ii) the Senior Notes due 2032 of $800.0 million, which were issued in June 2024, (iii) the Senior Notes due 2033 of $497.6 million, which were issued in October 2024, and an increase in the (iv) Revolving Credit Facility of $10.0 million, partially offset by decreases in the (v) Senior Notes due 2025 of $651.9 million, which were redeemed in April 2024, and (vi) the Senior Notes due 2027 of $400.0 million, which were redeemed in October 2024.

• Equity in losses of unconsolidated entities increased by $6.9 million, primarily driven by the profit elimination of $6.7 million for sales to the 2025 Partnership within the Aerospace Segment.

• Other income increased by $43.3 million, primarily due to a $30.1 million insurance settlement, gain on sale of $10.9 million from the sale of aircraft to the 2025 Partnership, and a $2.4 million increase in interest income earned on financing receivables during 2025 within our Aviation Leasing Segment.

Provision for income taxes

The Provision for income taxes increased $17.3 million, primarily driven by higher income discussed above generated in the Aircraft Leasing and Aerospace Products segments within taxable jurisdictions.

Net income increased by $62.8 million, primarily due to the changes noted above.

Total other expense decreased by $63.1 million during the three months ended June 30, 2025 due to the following:

• Gain on sale to the 2025 Partnership increased by $34.6 million, primarily driven by the sale of 33 aircraft to the 2025 Partnership within the Aviation Leasing Segment.

• Other income increased by $27.7 million, primarily due to a $24.2 million insurance settlement and a $2.2 million increase in interest income earned on financing receivables within the Aviation Leasing Segment.

• Loss on debt extinguishment decreased by $13.9 million driven by the 2024 redemption of Senior Notes due 2025 and partial redemption of Senior Notes due 2027.

• Interest expense increased by $8.8 million, reflecting an increase in the average debt outstanding of approximately $657.4 million, primarily due to increases in (i) the Senior Notes due 2032 of $533.3 million, which were issued in June 2024, (ii) the Senior Notes due 2033 of $497.7 million, which were issued in October 2024, partially offset by decreases in (iii) the Senior Notes due 2027 of $310.3 million, which were redeemed in October 2024, and (iv) the Revolving Credit Facility of $63.3 million.

• Equity in losses of unconsolidated entities increased by $4.3 million, primarily driven by the profit elimination of $4.9 million for sales to the 2025 Partnership.

Total other expense decreased by $85.1 million during the six months ended June 30, 2025 due to the following:

• Other income increased by $60.1 million, primarily due to a $54.3 million insurance settlement and a $4.5 million increase in interest income earned on financing receivables within our Aviation Leasing Segment.

• Gain on sale to the 2025 Partnership increased by $45.5 million, primarily driven by the sale of 37 aircraft to the 2025 Partnership within the Aviation Leasing Segment.

• Loss on debt extinguishment decreased by $13.9 million driven by the 2024 redemption of Senior Notes due 2025 and partial redemption of Senior Notes due 2027.

• Interest expense increased $23.1 million, reflecting an increase in the average debt outstanding of approximately $806.5 million, primarily due to increases in (i) the Senior Notes due 2032 of $666.7 million, which were issued in June 2024, (ii) the Senior Notes due 2033 of $497.7 million, which were issued in October 2024, and (iii) the Senior Notes due 2031 of $350.0 million, which were issued in April 2024, partially offset by decreases in (iv) the Senior Notes due 2027 of $355.2 million, which were redeemed in October 2024, (v) the Senior Notes due 2025 of $325.9 million, which were redeemed in April 2024, and (vi) the Revolving Credit Facility of $26.7 million.

• Equity in losses of unconsolidated entities increased by $11.3 million, primarily driven by the profit elimination of $11.9 million for sales to the 2025 Partnership.

Provision for (benefit from) income taxes

The provision for income taxes increased $50.9 million and $68.2 million during the three and six months ended June 30, 2025, respectively, primarily driven by higher income discussed above generated in the Aircraft Leasing and Aerospace Products segments within taxable jurisdictions.

Net income (loss)

Net income increased by $385.3 million and $448.0 million for the three and six months ended June 30, 2025 as compared to prior years primarily due to the changes noted above.

Adjusted EBITDA (Non-GAAP)

Adjusted EBITDA increased by $104.5 million, primarily due to the changes noted above.

Adjusted EBITDA increased by $133.9 million and $238.4 million during the three and six months ended June 30, 2025 as compared to prior years primarily due to the changes noted above.

Aviation Leasing Segment

As of March 31, 2025, in our Aviation Leasing segment, we own and manage 425 aviation assets, consisting of 107 commercial aircraft and 318 engines, including eight aircraft and seventeen engines that were still located in Russia.

As of March 31, 2025, 88 of our commercial aircraft and 178 of our engines were leased to operators or other third parties.

As of June 30, 2025, in our Aviation Leasing segment, we own and manage 375 aviation assets, consisting of 63 commercial aircraft and 312 engines, including eight aircraft and seventeen engines that were still located in Russia.

As of June 30, 2025, 53 of our commercial aircraft and 166 of our engines were leased to operators or other third parties.

Aviation assets currently off lease are either undergoing repair and/or maintenance, being prepared to go on lease or held in short term storage awaiting a future lease.

Our aviation equipment was approximately 78% utilized during the three months ended March 31, 2025, based on the percent of days on-lease in the quarter weighted by the monthly average equity value of our aviation leasing equipment, excluding airframes.

Our aviation equipment was approximately 70% utilized during the three months ended June 30, 2025, based on the percent of days on-lease in the quarter weighted by the monthly average equity value of our aviation leasing equipment, excluding airframes.

Our aircraft currently have a weighted average remaining lease term of 46 months, and our engines currently on-lease have an average remaining lease term of 30 months.

5 unchanged sentences

Transfers — (25) (25)

Assets at March 31, 2025 5 102 107

Assets at June 30, 2025 5 58 63

Assets at January 1, 2025 23 289 312

Purchases — 45 45

Sales (1) — (1)

Transfers — (44) (44)

Assets at March 31, 2025 23 295 318

Assets at June 30, 2025 22 290 312

The following table presents our results of operations for our Aviation Leasing segment:

Three Months Ended March 31, Change

Three Months Ended June 30, Change Six Months Ended

June 30, Change

(in thousands) 2025 2024 2025 2024

2 unchanged sentences

Asset sales revenue 47,915 72,433 (24,518) 66,854 111,040 (44,186)

Other revenue (1)

2,508 58 2,450 2,535 125 2,410

Total revenues 185,966 184,437 1,529 322,979 319,747 3,232

7 unchanged sentences

Equity in losses of unconsolidated entities (782) (61) (721) (1,559) (207) (1,352)

Other income (1)

43,489 369 43,120

Total other income 42,712 223 42,489

Gain on sale to the 2025 Partnership 34,604 — 34,604 45,474 — 45,474

Other income (expense) 26,974 (911) 27,885 59,593 (542) 60,135

Total other income (expense) 60,796 (972) 61,768 103,508 (749) 104,257

Income before income taxes 132,884 61,073 71,811 227,258 106,703 120,555

2 unchanged sentences

______________________________________________________

(1) Includes gain on sale of $10,870 and $0 for the three months ended March 31, 2025 and 2024, respectively, for sales to the 2025 Partnership.

(1) Includes servicing fees of $2,052 and $2,600 for the three and six months ended June 30, 2025, respectively, from the 2025 Partnership.

The following table sets forth a reconciliation of net income attributable to shareholders to Adjusted EBITDA:

Three Months Ended March 31, Change

Three Months Ended June 30, Change Six Months Ended

June 30, Change

(in thousands) 2025 2024 2025 2024

10 unchanged sentences

Interest expense and dividends on preferred shares — — — — — —

Internalization fee to affiliate — — — — — —

Pro-rata share of Adjusted EBITDA from unconsolidated entities (2)

4 unchanged sentences

________________________________________________________

(1) Includes the follo wing items for the three months ended March 31, 2025 and 2024:

(i) depreciation expense of $55,061 and $46,084, (ii) lease intangible amortization of $3,206 and $3,976 and (iii) amortization for lease incentives of $5,619 and $5,226, respec tively.

(2) Includes th e following items for the three months ended March 31, 2025 and 2024:

(i) net loss of $777 and $146, (ii) depreciation and amortization of $102 and $63, and (iii) acquisition and transaction expense of $547 and $0 , respectively.

Comparison of the three months ended March 31, 2025 and 2024

Total revenues increased by $1.7 million, driven by the following:

• Leas e in come increased by $17.6 million, due to an increase in aircraft lease revenue of $11.6 million and an increase in engine lease revenue of $6.0 million, driven by an increased number of aircraft and engines on lease in addition to higher rental rates.

• Maintenance revenue increased by $3.8 million, primarily due to an increase in aircraft maintenance revenue of $1.6 million and an increase in engine maintenance revenue of $2.2 million, driven by an increased number of aircraft and engines on lease in Q1 2025 as compared to Q1 2024.

(1) Includes the following items for the three months ended June 30, 2025 and 2024:

(i) depreciation expense of $50,423 and $52,672, (ii) lease intangible amortization of $2,153 and $3,786 and (iii) amortization for lease incentives of $8,288 and $5,332, respectively.

Includes the following items for the six months ended June 30, 2025 and 2024:

(i) depreciation expense of $105,484 and $98,756, (ii) lease intangible amortization of $5,359 and $7,762 and (iii) amortization for lease incentives of $13,907 and $10,558, respectively.

(2) Includes the following items for the three months ended June 30, 2025 and 2024:

(i) net loss of $782 and $61, (ii) interest expense of $1,490 and $0, (iii) depreciation and amortization of $3,301 and $21 and (iv) acquisition and transaction expenses of $(77) and $0, respectively.

Includes the following items for the six months ended June 30, 2025 and 2024:

(i) net loss of $1,559 and $207, (ii) interest expense of $1,490 and $0, (iii) depreciation and amortization of $3,403 and $84 and (iv) acquisition and transaction expenses of $470 and $0, respectively.

Comparison of the three months ended June 30, 2025 and 2024

Total reven ue increased by $1.5 million, driven by the following:

• Other revenue increased by $2.5 million as a result of servicing fees earned in our capacity as the Servicer to the 2025 Partnership.

• Lease income increased by $1.7 million due to an increase in engine lease revenue of $4.1 million, partially offset by a decrease in aircraft lease revenue of $2.4 million driven by the sale of Seed Assets to the 2025 Partnership.

• Asset sales revenue decreased by $24.5 million, primarily due to an overall decrease in the number of sales transactions of commercial aircraft and engines.

Specifically, there were no aircraft and no engines sold in Q1 2025 as compared to four engines sold in Q1 2024.

Total exp enses decreased by $4.6 million, driven by the following:

• Cost of sales decreased by $11.9 million, prim arily due to an overall decrease in the number of sales transactions of commercial aircraft and engines, which is in line with an overall decrease in the corresponding asset sales revenue.

Specifically, there were no aircraft and no engines sold in Q1 2025 as compared to four engines sold in Q1 2024.

• Operating exp ense s decreased by $0.8 million, primarily dri ven by a decrease in repairs and maintenance expense of $0.8 million and professional fees of $0.6 million, partially offset by an increase in insurance expense of $0.6 million.

• Depreciation and amor tization increased $9.0 million, primarily dri ven by an increase in the number of assets owned and on lease during the quarter, partially offset by an increase in the number of aircraft redelivered and parted out into our engine leasing pool.

Specifically, one engine sold in Q2 2025 as compared to six engines sold in Q2 2024.

Comparison of the six months ended June 30, 2025 and 2024

Total revenue increased $3.2 million, driven by the following:

• Maintenance revenue increased by $25.7 million, primarily due to an increase in aircraft maintenance revenue of $24.7 million driven by an increase in utilization and higher maintenance reserves taken into revenue, partially offset by the sale of Seed Assets to the 2025 Partnership.

• Lease income increased by $19.3 million, due to an increase in aircraft lease revenue of $9.2 million and an increase in engine lease revenue of $10.1 million, driven by an increased number of aircraft and engines on lease in addition to higher rental rates.

• Other revenue increased by $2.4 million as a result of servicing fees earned in our capacity as the Servicer to the 2025 Partnership.

• Asset sales revenue decreased by $44.2 million, primarily due to an overall decrease in the number of sales transactions of commercial aircraft and engines.

Specifically, one engine sold in 2025 as compared to 10 engines sold in the prior-year period.

Comparison of the three months ended June 30, 2025 and 2024

Total expenses decreased by $8.5 million, driven by the following:

• Cost of sales decreased by $7.2 million, primarily due to an overall decrease in the number of sales transactions of commercial aircraft and engines, which is in line with an overall decrease in the corresponding asset sales revenue.

• Depreciation and amortization expense decreased by $2.2 million, primarily driven by the increase of assets held-for-sale and the sale of Seed Assets to the 2025 Partnership.

Comparison of the six months ended June 30, 2025 and 2024

Total expenses decreased by $13.1 million, driven by the following:

• Cost of sales decreased by $19.1 million, primarily due to an overall decrease in the number of sales transactions of commercial aircraft and engines, which is in line with an overall decrease in the corresponding asset sales revenue.

• Depreciation and amortization expense increased by $6.7 million, primarily driven by an increase in the number of assets owned and on lease during the period, partially offset by an increase of assets held-for-sale and the sale of Seed Assets to the 2025 Partnership.

Other income (expense)

Total other income increased by $42.5 million, primarily due to a $30.1 million insurance settlement, gain on sale of $10.9 million from the sale of aircraft to the 2025 Partnership, and a $2.4 million increase in interest income earned on financing receivables during 2025.

Total other income increased by $61.8 million and $104.3 million during the three and six months ended June 30, 2025, primarily due to (i) an insurance settlement of $24.2 million and $54.3 million, respectively, (ii) gains on sale to the 2025 Partnership of $34.6 million and $45.5 million, respectively, and (iii) a $2.2 million and $4.5 million increase in interest income earned on financing receivables during 2025, respectively.

Provision for income taxes

The provision for income taxes increased by $14.3 million, primarily due to the increase in income discussed above from leasing activities in jurisdictions subject to taxes.

Net income increased by $34.4 million, primarily due to the changes noted above.

The provision for income taxes increased by $18.2 million and $32.5 million during the three and six months ended June 30, 2025, respectively, primarily due to the increase in income discussed above from leasing activities in jurisdictions subject to taxes.

Net income increased by $53.7 million and $88.1 million during the three and six months ended June 30, 2025, respectively, primarily due to the changes noted above.

Adjusted EBITDA (Non-GAAP)

Adjusted EBITDA increased by $57.2 million, prim arily due to the changes noted above.

Adjusted EBITD A increased by $74.3 million and $131.5 million during the three and six months ended June 30, 2025, respectively, primarily due to the changes noted above.

Aerospace Products Segment

The Aerospace Products segment, through our maintenance facilities, equity method investment and exclusivity arrangements, develops and manufactures, repairs/refurbishes, and sells aircraft engines and aftermarket components primarily for the CFM56-5B, CFM56-7B, and V2500 commercial aircraft engines.

Our engine, module and parts sales are facilitated through a dedicated commercial maintenance program, designed to focus on modular and parts repair and refurbishment of CFM56-5B, CFM56-7B and V2500 engines.

On December 30, 2024, with the launch of the 2025 Partnership, the Company entered into an agreement with our MRE business to supply replacement aircraft engines and modules for the life of the 2025 Partnership.

In September 2024, we acquired LMCES to further enhance this business and establish permanent engine and module manufacturing capabilities.

Our engine, module, and parts sales are facilitated through a dedicated commercial maintenance program designed to focus on modular and parts repair and refurbishment of these engines.

We entered into an agreement with our MRE business to supply replacement aircraft engines and modules for the life of the 2025 Partnership.

To further enhance this business and establish permanent engine and module manufacturing capabilities, we acquired Lockheed Martin Commercial Engine Solutions (LMCES).

Refer to Note 3, “Acquisition of Lockheed Martin Commercial Engine Solutions,” for additional information.

In addition, other serviceable used modules and parts are sold through our exclusive partnership, who is responsible for the teardown, repair, marketing and sales of parts from our CFM56-5B and CFM56-7B engine pool.

In December 2023, we acquired the remaining interest in Quick Turn Engine Center LLC or “QuickTurn” (previously iAero Thrust LLC), a hospital maintenance and testing facility dedicated to the CFM56-5B and CFM56-7B engine.

We also hold a 25% interest in the Advanced Engine Repair JV which focuses on developing new cost savings programs for engine repairs.

Other serviceable used modules and parts are sold through our exclusive partnership, which is responsible for the teardown, repair, marketing, and sales of parts from our CFM56-5B and CFM56-7B engine pool.

We also acquired the remaining interest in Quick Turn Engine Center LLC, or “QuickTurn” (formerly iAero Thrust LLC), a hospital maintenance and testing facility specializing in the CFM56-5B and CFM56-7B engines.

We further expanded our footprint in engine services by acquiring a 50% equity interest in QuickTurn Europe, which will operate as a dedicated maintenance, repair, and overhaul facility for CFM56 engines.

Additionally, we maintain a 25% ownership stake in the Advanced Engine Repair joint venture, which is focused on developing innovative cost-saving programs for engine repairs.

The following table presents our results of operations:

Three Months Ended March 31, Change

Three Months Ended June 30, Change Six Months Ended

June 30, Change

(in thousands) 2025 2024 2025 2024

Aerospace products revenue $ 420,686 $ 245,200 $ 175,486 $ 685,111 $ 434,257 $ 250,854

365,063 189,057 176,006

MRE Contract revenue 69,585 — 69,585 170,223 — 170,223

Total revenues 490,271 245,200 245,071 855,334 434,257 421,077

Cost of sales 317,469 146,888 170,581 546,224 257,803 288,421

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Total expenses 331,576 154,774 176,802 570,734 274,338 296,396

Other expense

Other income (expense)

Equity in earnings (losses) of unconsolidated entities 714 (633) 1,347 827 (1,154) 1,981

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Provision for income taxes 25,827 4,918 20,909 45,202 7,457 37,745

Net income 106,643 66,433 40,210

Net income attributable to shareholders $ 133,582 $ 84,875 $ 48,707 $ 240,225 $ 151,308 $ 88,917

________________________________________________________

(1) Includes revenue of $100,638 and $0 for the three months ended March 31, 2025 and 2024, respectively, for sales to the 2025 Partnership.

See Note 11 for additional information.

The following table sets forth a reconciliation of net income attributable to shareholders to Adjusted EBITDA:

Three Months Ended March 31, Change

Three Months Ended June 30, Change Six Months Ended

June 30, Change

(in thousands) 2025 2024 2025 2024

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Interest expense and dividends on preferred shares — — — — — —

Internalization fee to affiliate — — — — — —

Pro-rata share of Adjusted EBITDA from unconsolidated entities (1)

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________________________________________________________

(1) Includes the following items for the three months ended March 31, 2025 and 2024:

(i) net income (loss) of $113 and $(521), and (ii) depreciation and amortization expense of $56 and $56, respectively.

Comparison of the three months ended March 31, 2025 and 2024

Tot al Aerospace Products revenue increased by $176.0 million, prima rily due to a $165.2 million increase in CFM56-5B, CFM56-7B and V2500 engine and module sales including to the 2025 Partnership, as well as a $10.7 million increase in other revenues from the QuickTurn and LMCES.

Tota l expense s increased by $119.6 million, due to the following:

• Cost of sales increased by $117.8 million, primarily due to increases in CFM56-5B, CFM56-7B and V2500 engine and module sales, and parts inventory sales, which directly corresponds to components of increases in Aerospace products revenue over the same period.

• Operating expenses increased by $1.8 million, primarily due to higher compensation and benefits expense due to the increase in employee headcount from the acquisitions of LMCES in the third quarter of 2024.

• Depreciation and amortization increased by $2.7 million due to the acquisitions of LMCES in the third quarter of 2024.

• Acquisition and transaction expenses increased by $0.9 million, primarily driven by higher professional fees incurred in evaluating and completing strategic transactions.

(1) Includes the following items for the three months ended June 30, 2025 and 2024:

(i) net income of $714 and net loss of $633 and (ii) depreciation and amortization expense of $169 and $56, respectively.

Includes the following items for the six months ended June 30, 2025 and 2024:

(i) net income of $827 and net loss of $1,154 and (ii) depreciation and amortization expense of $225 and $112, respectively.

Comparison of the three months ended June 30, 2025 and 2024

Total revenues increased by $245.1 million, due to the following:

• Aerospace Products revenue increased by $175.5 million, primarily due to a $172.1 million increase in CFM56-5B, CFM56-7B and V2500 engine and module sales, as well as a $3.2 million increase in other maintenance service revenues.

• MRE Contract revenue increased by $69.6 million, primarily due to an increase in CFM56-5B and CFM56-7B engine and module sales made to the 2025 Partnership.

Comparison of the six months ended June 30, 2025 and 2024

Total revenues increased by $421.1 million, due to the following:

• Aerospace Products revenue increased by $250.9 million, primarily due to a $237.0 million increase in CFM56-5B, CFM56-7B and V2500 engine and module sales, as well as a $11.9 million increase in other maintenance service revenues.

• MRE Contract revenue increased by $170.2 million, primarily due to an increase in CFM56-5B and CFM56-7B engine and module sales made to the 2025 Partnership.

Comparison of the three months ended June 30, 2025 and 2024

Tota l expenses increased by $176.8 million, due to the following:

• Cost of sale s increased by $170.6 million, primarily due to increases in CFM56-5B, CFM56-7B and V2500 engine and module sales, and parts inventory sales, which directly corresponds to components of increases in Aerospace products revenue over the same period.

• Operating expenses increased by $2.6 million, primarily due to higher compensation and benefits expense due to the acquisition of LMCES and an increase in shipping and logistics expense.

Comparison of the six months ended June 30, 2025 and 2024

Tota l expenses increased by $296.4 million, due to the following:

• Cost of sale s increased by $288.4 million, primarily due to increases in CFM56-5B, CFM56-7B and V2500 engine and module sales, and parts inventory sales, which directly corresponds to components of increases in Aerospace products revenue over the same period.

• Operating expenses increased by $0.8 million, primarily due to higher compensation and benefits expense due to the acquisitions of LMCES.

• Depreciation and amortization increased by $5.4 million due to the acquisition of LMCES in the third quarter of 2024.

Provision for income taxes

The Provision for income taxes increased by $16.8 million, primarily due to the increase in income discussed above from Aerospace Products activities in jurisdictions subject to taxes.

Net income increased by $40.2 million, primarily due to the changes noted above.

The provision for income taxes increased by $20.9 million and $37.7 million during the three and six months ended June 30, 2025, respectively, primarily due to the increase in income discussed above from Aerospace Products activities in jurisdictions subject to taxes.

Net income increased $48.7 million and $88.9 million during the three and six months ended June 30, 2025, respectively, primarily due to the changes noted above.

Adjusted EBITDA (Non-GAAP)

Adjusted EBITD A increased by $60.7 million, primarily due to the changes noted above.

Adjusted EBITD A increased $73.6 million and $134.3 million during the three and six months ended June 30, 2025, respectively, primarily due to the changes noted above.

Corporate and Other

The following table presents our results of operations:

Three Months Ended March 31, Change

Three Months Ended June 30, Change Six Months Ended

June 30, Change

(in thousands) 2025 2024 2025 2024

Lease income $ — $ 9,995 $ (9,995) $ — $ 12,310 $ (12,310)

Other revenue — 3,962 $ (3,962) 4 3,974 $ (3,970)

Total revenues — 13,957 (13,957) 4 16,284 (16,280)

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Management fees and incentive allocation to affiliate — 3,554 (3,554) — 8,449 (8,449)

Internalization fee to affiliate — 300,000 (300,000) — 300,000 (300,000)

Depreciation and amortization 1,109 3,081 (1,972) 2,026 5,984 (3,958)

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Interest expense (63,965) (55,196) (8,769) (126,005) (102,903) (23,102)

Loss on extinguishment of debt — (13,920) 13,920 — (13,920) 13,920

Other income 182 413 (231) 634 678 (44)

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The following table sets forth a reconciliation of net loss attributable to shareholders to Adjusted EBITDA:

Three Months Ended March 31, Change

Three Months Ended June 30, Change Six Months Ended

June 30, Change

(in thousands) 2025 2024 2025 2024

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Acquisition and transaction expenses 2,498 5,525 (3,027) 5,753 8,697 (2,944)

Losses on the modification or extinguishment of debt and capital lease obligations 6,327 — 6,327

Losses on the modification or extinguishment of debt and preferred shares and capital lease obligations — 13,920 (13,920) 6,327 13,920 (7,593)

Changes in fair value of non-hedge derivative instruments — — — — — —

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Interest expense and dividends on preferred shares 67,674 63,531 4,143 135,829 119,573 16,256

Internalization fee to affiliate — 300,000 (300,000) — 300,000 (300,000)

Pro-rata share of Adjusted EBITDA from unconsolidated entities — — — — — —

Equity in losses of unconsolidated entities — — —

Equity in losses (earnings) of unconsolidated entities — — — — — —

Non-controlling share of Adjusted EBITDA — — — — — —

Adjusted EBITDA (non-GAAP) $ (11,427) $ (2,317) $ (9,110) $ (28,853) $ (13,300) $ (15,553)

Comparison of the three months ended March 31, 2025 and 2024

Total revenues decreased by $2.3 million, primarily due to the sale of the two vessels within the Offshore Energy business during the fourth quarter of 2024.

Total exp enses increased by $2.3 million, due to the following:

• Operating expenses increased $9.7 million primarily due to higher compensation and benefits expense due to the increase in employee headcount and increased overall compensation.

• Management fees and incentive allocation to affiliate decreased by $4.9 million, due to a decrease in management and incentive fees to the Former Manager with the Internalization effective May 28, 2024.

Total revenues decreased $14.0 million and $16.3 million during the three and six months ended June 30, 2025 primarily due to the sale of the two vessels within the Offshore Energy business during the fourth quarter of 2024.

Comparison of the three months ended June 30, 2025 and 2024

Total expens es decreased by $308.7 million, due to the following:

• Internalization fee to affiliate decreased $300.0 million relating to the Internalization effective May 28, 2024.

• Management fees and incentive allocation to affiliate decreased by $3.6 million, due no management and incentive fees paid to the Former Manager during 2025, with the Internalization effective May 28, 2024.

• Acquisition and transaction expense decreased $3.0 million primarily due to lower professional fees associated with the Internalization.

• Depreciation and amortization decreased by $2.0 million, due to the sale of the two vessels within the Offshore Energy business during the fourth quarter of 2024.

• Operating expenses increased $0.4 million primarily due to higher compensation and benefits expense due to an increase in employee headcount and increased overall compensation.

Comparison of the six months ended June 30, 2025 and 2024

Total expenses decreased by $306.4 million, due to the following:

• Internalization fee to affiliate decreased $300.0 million relating to the Internalization effective May 28, 2024.

• Depreciation and amortization decreased by $4.0 million, due to the sale of the two vessels within the Offshore Energy business during the fourth quarter of 2024.

• Acquisition and transaction expense decreased $2.9 million primarily due to lower professional fees associated with the Internalization and the sale of the Offshore Energy vessels.

• Operating expenses increased $10.0 million primarily due to higher compensation and benefits expense due to an increase in employee headcount and increased overall compensation.

Other income (expense)

Total other expense increased by $14.1 million, due to the following:

• Interest expense increased by $14.3 million, reflecting an increase in the average debt outstanding of approximately $955.7 million primarily due to increases in (i) the Senior Notes due 2031 of $700.0 million, which were issued in April 2024, (ii) the Senior Notes due 2032 of $800.0 million, which were issued in June 2024, (iii) the Senior Notes due 2033 of $497.6 million, which were issued in October 2024, and an increase in the (iv) Revolving Credit Facility of $10.0 million, partially offset by a decreases in the (v) Senior Notes due 2025 of $651.9 million, which were redeemed in April 2024, and (vi) the Senior Notes due 2027 of $400.0 million, which were redeemed in October 2024.

Total other expense decreased by $4.9 million during the three months ended June 30, 2025, due to the following:

• Loss on extinguishment of debt decreased by $13.9 million, driven by the 2024 redemption of Senior Notes due 2025 and partial redemption of Senior Notes due 2027.

Total other expense increased by $9.2 million during the six months ended June 30, 2025, due to the following:

• Interest expense increased by $23.1 million, reflecting an increase in the average debt outstanding of approximately $806.5 million, primarily due to increases in (i) the Senior Notes due 2032 of $666.7 million, which were issued in June 2024, (ii) the Senior Notes due 2033 of $497.7 million, which were issued in October 2024, and (iii) the Senior Notes due 2031 of $350.0 million, which were issued in April 2024, partially offset by decreases in (iv) the Senior Notes due 2027 of $355.2 million, which were redeemed in October 2024, (v) the Senior Notes due 2025 of $325.9 million, which were redeemed in April 2024, and (vi) the Revolving Credit Facility of $26.7 million.

• Loss on extinguishment of debt decreased by $13.9 million, driven by the 2024 redemption of Senior Notes due 2025 and partial redemption of Senior Notes due 2027.

Benefit from income taxes

The benefit from income taxes increased by $13.9 million.

This increase was primarily attributable to a tax benefit arising from an increase in corporate overhead expenses, which reduced taxable income from leasing and aerospace activities and led to a more favorable tax position for the company.

Net loss decreased by $4.9 million, primarily due to the changes noted above.

The benefit from income taxes decreased by $11.8 million for the three months ended June 30,2026, and increased by $2.0 million during the six months ended June 30, 2025.

The decrease in the three-month period was primarily attributable to a tax benefit recognized in connection with the internalization fee paid to affiliate, which was deductible for tax purposes.

The increase in the six-month period was mainly driven by higher corporate overhead expenses deductible for 2025 tax purposes.

Net loss decreased by $287.8 million and $282.9 million during the three and six months ended June 30, 2025, respectively, primarily due to the changes noted above.

Adjusted EBITDA (Non-GAAP)

Adjusted EBITDA decreased by $6.4 million, primarily due to the changes noted above.

Adjusted EBITDA decreased by $9.1 million and decreased $15.6 million during the three and six months ended June 30, 2025, respectively, primarily due to the changes noted above.

Liquidity and Capital Resources

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The Company has agreed that the 2025 Partnership, and follow-on partnerships, will be the primary buyer of on-lease 737NG and A320ceo aircraft.

The Company, as the General Partner, will manage the aircraft in the 2025 Partnership, and the Company will receive customary, market-based compensation.

The Company, as the Servicer, will manage the aircraft in the 2025 Partnership, and the Company will receive customary, market-based compensation.

The Company has also made a minority investment and will make future investments in the 2025 Partnership.

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In the future, instead of acquiring on-lease aircraft directly, as part of the Strategic Capital Initiative, we will invest in the related partnerships and such partnerships will acquire on-lease aircraft.

• Cash used for the purpose of making investments was $339.4 million and $303.0 million during the three months ended March 31, 2025 and 2024, respectively.

• Distributions to shareholders, including cash dividends, were $36.9 million and $38.4 million during the three months ended March 31, 2025 and 2024, respectively.

• Cash used for the purpose of making investments was $594.9 million and $563.1 million during the six months ended June 30, 2025 and 2024, respectively.

• Distributions to shareholders, including cash dividends, were $71.4 million and $76.8 million during the six months ended June 30, 2025 and 2024, respectively.

• Uses of liquidity associated with our operating expenses are captured on a net basis in our cash flows from operating activities.

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Our principal sources of liquidity to fund these uses have been and continue to be (i) revenues from our aviation assets (including finance lease collections and maintenance reserve collections) net of operating expenses, (ii) proceeds from borrowings or the issuance of securities and (iii) proceeds from asset sales.

• Cash flows from operating activities, plus the principal collections on finance leases and maintenance reserve collections were $11.0 million and $9.4 million during the three months ended March 31, 2025 and 2024, respectively.

• During the three months ended March 31, 2025, additional borrowings and total principal repayments in connection with the Revolving Credit Facility were $290.0 million and $90.0 million, respectively.

During the three months ended March 31, 2024, additional borrowings and total principal repayments in connection with the Revolving Credit Facility were $210.0 million and $35.0 million, respectively.

• Proceeds from the sale of assets were $263.1 million and $128.4 million during the three months ended March 31, 2025 and 2024, respectively.

• Cash flows used in operating activities, plus the principal collections on finance leases and maintenance reserve collections were $107.2 million and $165.3 million during the six months ended June 30, 2025 and 2024, respectively.

• During the six months ended June 30, 2025, additional borrowings and total principal repayments in connection with the Revolving Credit Facility were $430.0 million and $430.0 million, respectively.

During the six months ended June 30, 2024, additional borrowings were obtained in connection with the (i) Senior Notes due 2032 of $800.0 million, (ii) Senior Notes due 2031 of $700.0 million and (iii) Revolving Credit Facility of $360.0 million and made total principal repayments of (i) $650.0 million related to the Senior Notes due 2025, (ii) $360.0 million relating to the Revolving Credit Facility and (iii) $269.1 million related to the Senior Notes due 2027.

• Proceeds from the sale of assets were $986.5 million and $333.7 million during the six months ended June 30, 2025 and 2024, respectively.

• In February 2025, the Company redeemed in full the outstanding Series B preferred shares at a redemption price equal to $25.00 per share in cash, plus $2.4 million of accumulated and unpaid distributions thereon to, but not including, the redemption date of February 16, 2025.

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Historical Cash Flow

Comparison of the three months ended March 31, 2025 and 2024

The following table compares the historical cash flow for the three months ended March 31, 2025 and 2024:

Three Months Ended March 31,

Comparison of the six months ended June 30, 2025 and 2024

The following table compares the historical cash flow for the six months ended June 30, 2025 and 2024:

Six Months Ended June 30,

(in thousands) 2025 2024

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Net cash used in operating activities $ (136,284) $ (187,636)

Net cash used in investing activities (27,627) (169,213)

Net cash provided by financing activities 50,610 144,026

Net cash used in operating activities increased $25.6 million, which primarily reflects certain adjustments to reconcile net income to cash provided by operating activities including (i) Changes in net working capital of $132.8 million and an increase in (ii) Gain on insurance recoveries of $30.1 million, partially offset by an increase in (iii) Net income of $62.8 million, a decrease in (iv) Gain on sale of assets, net of $38.6 million, and increases in (v) Deferred income taxes of $16.1 million, (vi) Depreciation and amortization of $9.6 million, (vii) Equity in losses of unconsolidated entities of $6.9 million and (viii) Equity-based compensation of $4.4 million.

Net cash used in investing activities decreased $141.6 million, primarily due to increases in (i) Proceeds from the sale of assets of $104.6 million, (ii) Return of deposits for acquisition of leasing equipment of $43.8 million, (iii) Proceeds from settlement of insurance claims of $30.1 million and a decrease in (iv) Acquisitions of leasing equipment of $9.6 million, partially offset by increases in (v) Deposits for acquisition of leasing equipment of $20.8 million and (vi) Investment in unconsolidated entities of $20.0 million.

Net cash provided by financing activities decreased $93.4 million, primarily due to increases in (i) Redemption of preferred shares of $124.2 million and (ii) Repayment of debt of $55.0 million, partially offset by increases in (iii) Proceeds from debt of $80.0 million and (iv) Receipt of maintenance deposits under operating lease agreements of $6.1 million.

Net cash provided by (used in) investing activities 496,148 (219,383)

Net cash (used in) provided by financing activities (173,069) 485,748

Net cash used in operating activities decreased $51.4 million, which primarily reflects (i) an increase in our Net income of $448.0 million and certain adjustments to reconcile net income to cash used in operating activities including increases in (ii) Deferred income taxes of $57.5 million, (iii) Equity in losses of unconsolidated entities of $11.3 million, (iv) Equity-based compensation of $9.3 million and (v) Depreciation and amortization of $8.2 million partially offset by decreases in (vi) Non-cash termination fee to affiliate of $150.0 million, (vii) Gain on sale of assets of $80.0 million, (viii) Gain on insurance recoveries of $54.3 million, (ix) Gain on sale of assets to the 2025 Partnership of $45.5 million,(x) Security deposits and maintenance claims included in earnings of $25.9 million, (xi) Loss on extinguishment of debt of $13.9 million, and (xii) Changes in net working capital of $117.3 million.

Net cash provided by investing activities increased $715.5 million, primarily due to increases in (i) Proceeds from the sale of assets to the 2025 Partnership of $397.1 million, (ii) Proceeds from the sale of assets of $255.7 million, (iii) Proceeds from settlement of insurance claims of $54.3 million, and (iv) Return of deposits for acquisition of leasing equipment of $43.8 million, as well as a decrease in (v) Deposits for acquisition of leasing equipment of $54.4 million.

These were partially offset by decreases related to (vi) Acquisitions of leasing equipment of $24.0 million and (vii) Investments in financing receivables of $17.0 million, and by increases in (viii) Investment in unconsolidated entities of $118.7 million and (ix) Acquisition of property, plant and equipment of $8.6 million.

Net cash used in financing activities increased $658.8 million, primarily due to a decrease in (i) Proceeds from debt of $1.4 billion and an increase in (ii) Redemption of preferred shares of $124.2 million, partially offset by decreases in (iii) Repayment of debt of $857.4 million and (iv) Payment of deferred financing costs of $9.7 million and an increase in (v) Receipt of maintenance deposits under operating lease agreements of $6.7 million.

Contractual Obligations

Our material cash requirements include the following contractual and other obligations:

Debt Obligations — As of March 31, 2025, we had outstanding principal and interest payment obligations of $3.7 billion and $1.4 billion, respectively, of which only interest payments of $248.9 million are due in the next twelve months.

Debt Obligations — As of June 30, 2025, we had outstanding principal and interest payment obligations of $3.5 billion and $1.3 billion, respectively, of which only interest payments of $228.8 million are due in the next twelve months.

See Note 7 to the consolidated financial statements for additional information about our debt obligations.

Lease Obligations —As of March 31, 2025, we had outstanding operating and finance lease obligations of $37.0 million, of which $3.2 million is due in the next twelve months.

Lease Obligations —As of June 30, 2025, we had outstanding operating and finance lease obligations of $37.0 million, of which $3.6 million is due in the next twelve months.

Other Cash Requirements —In addition to our contractual obligations, we pay quarterly cash dividends on our ordinary shares and preferred shares, which are subject to change at the discretion of our Board of Directors.

During the last twelve months, we declared cash dividends of $123.0 million and $25.9 million on our ordinary shares and preferred shares, respectively.

We expect to meet our future short-term liquidity requirements through cash on hand, unused borrowing capacity or future

financings and net cash provided by our current operations.

We expect to meet our future short-term liquidity requirements through cash on hand, unused borrowing capacity or future financings and net cash provided by our current operations.

We expect that our operating subsidiaries will generate sufficient cash flow to cover operating expenses and the payment of principal and interest on our indebtedness as they become due.

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Recent Accounting Pronouncements

There have been no developments to recently issued accounting pronouncements, nor any changes to expected adoption dates or estimated effects on the Company’s consolidated financial statements and related footnote disclosures, from those previously reported on the Form 10-K for the year ended December 31, 2024.

See Note 2 to our Consolidated Financial Statements for recent accounting pronouncements.

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-Q

Item 2. Management’s Discussion and Analysis