CALC Announces 2023 Annual Results

Steady Revenue Growth with Adj. Shareholders Profit Surged by Four Times

China Aircraft Leasing Group Holdings Limited (CALC or the Company, together with its subsidiaries, the Group HKG: 01848), a full value chain aircraft solutions provider for the global aviation industry, is pleased to announce its annual results for the year ended 31 December 2023 (the Review Year).

Results Highlights

• Steady revenue growth For the Review Year, the Group’s total revenue amounted to HK$4,763.7 million, up 14.2% year-on-year. (2022：HK$4,171.0 million).
• Adj. profit attributable to shareholders surged by four times Profit attributable to shareholders of the Company for the Review Year was HK$28.3million. If exceptional item was excluded, adjusted profit attributable to shareholders(1) of the Company for the Review Year should have reached HK$184.9 million, significantly grew by four times year-on-year.
• The Board has recommended payment of a final dividend of HK$0.15 per ordinary share. Together with the 2023 interim dividend of HK$0.15 per share already paid, total dividend payout for the year 2023 amounted to HK$0.30 (2022: HK$0.30 per share). The Company has resumed its scrip dividend scheme for the final dividend for 2023.
• Enlarged and optimized global presence with excellent rental collection ratio During the Review Year, the Group has extended its footprint to the Central Asian, African and Oceania market. Among all the new deliveries, 13 aircraft were leased to overseas airlines and 8 were leased to Chinese airlines, including cooperation with 6 first-tier airlines in new aircraft leasing for the first time. The Group’s rental collection ratio was 101.4% benefiting from an overall improvement for its customer profile.
• Smooth overseas operation of the Group’s ARJ21 fleet The Indonesian carrier TransNusa (“TransNusa”) as the Group’s associate company completed its debut commercial flight for its first ARJ21, received its second ARJ21 jet and launched multiple popular routes with total passengers carried exceeding 100,000 for the whole year.
• Developing green financing During the Review Year, the Group’s total new financing facilities obtained amounted to HK$24 billion. The Group launched the first sustainability-linked aircraft pre-delivery payment (“PDP”) syndicated loan in the global aircraft leasing industry; issued the first and second trenches of low-carbon transition corporate bonds of RMB1.5 billion and RMB500 million, respectively in 2023.

Business Review
Prudent fleet management, enlarged and optimized global clientele

• During the Review Year, the Group delivered a total of 21 new aircraft to airline customers, with a majority of new-generation fuel-efficient models, including its first two B737 Max aircraft taken from Boeing. The Group also injected one aircraft to its investment vehicle and sold a total of fouraircraft to third party.
• As at 31 December 2023,CALC’s fleet has increased to 192 aircraft，including 165 owned and 27 managed aircraft. By number of aircraft, 90% of the Group’s owned fleet were narrow-body models, a highly liquid asset class.
• During the Review Year, CALC celebrated the 10th anniversary of its cooperation with the long- term strategic partner Airbus. CALC is the 6th largest lessor customer for Airbus in terms of accumulated orders. As at 31 December 2023, the Group had a total of 141 aircraft on backlog, including 113 Airbus A320NEO and 28 COMAC ARJ21.
• During the Review Year, the Group continued to maintain its leading position in the China market. As at 31 December 2023, by number of aircraft, 71.5% of the Group’s owned fleet were leased to Chinese airline customers (including Hong Kong, Macau and Taiwan), most of which were first-tier airlines with strong financial strength.
• During the Review Year, a total of 34 letters of intent for aircraft leasing was signed with overseas airline customers. Among all the new deliveries during the year, 13 were leased to overseas airlines and 8 were leased to Chinese airlines, including cooperation with 6 first-tier airlines in new aircraft leasing for the first time. As at 31 December 2023, CALC’s owned and managed aircraft were on lease to 41 airlines in 20 countries and regions.

Developing green financing and improving international credit ratings

• During the Review Year, the Group obtained new financing facilities in excess of HK$24 billion, including aircraft project loans, PDP financing, working capital facilities, RMB bonds, etc. As at 31 December 2023, the Group had cash and cash equivalents amounting to HK$5,300 million up 49.1% year-on-year.
• During the Review Year, CALC launched the first sustainability-linked aircraft PDP syndicated loan in the global aircraft leasing industry with an initial size of US$350 million. CALC also completed its first and second tranche of low-carbon transition corporate bonds issuance in 2023 with the amount of RMB1.5 billion and RMB500 million, respectively, demonstrating investors’ full recognition of the Group’s operational strength and its commitment to sustainable operations.
• During the Review Year, the Group took the initiative to manage its liabilities by completing the repurchase of the full valid principal for two outstanding USD bonds around US$50 million. In December 2023, the Group also completed the redemption of the principal amount of US$100 million perpetual bonds.
• During the Review Year, Fitch affirmed CALC’s Long-Term Issuer Default Rating at BB+, while Moody’s affirmed the Company’s Corporate Family Rating at Ba1, both with a stable outlook. China Asset Leasing Company Limited as the Group’s wholly-owned subsidiary received an AAA issuer rating from Dagong Global and an upgrade to AAA rating from CCXI, both with a stable outlook.
• The Group has set upgrading its international credit rating as one of its key development targets at this stage. In the future, the Group will continue to actively expand multiple financing channels and increase its unsecured financing, optimizing its debt structure, moving towards to the international investment grade.

Moving towards a sustainable future

• During the Review Year, the Group continued to promote the healthy development of TransNusa, following the completion of the debut flight of its first ARJ21 aircraft in April, the Group has delivered another ARJ21 aircraft to the carrier. With its successful launch of several popular routes to Bali, Yogyakarta, Kuala Lumpur and Johor Bahru of Malaysia during the year, TransNusa has carried more than 100,000 passengers in total in 2023.
• During the Review Year, the Group was awarded the “Sustainability Debt Deal of the Year” by Airline Economics in recognition of the Company’s pioneering ESG practices by issuing the first- ever low-carbon transition bond in China’s aviation market, reflecting the Group’s commitment to move towards a sustainable future through innovative transactions.

Mr. Mike Poon, Executive Director and CEO of CALC said, “Following several positive adjustments in 2023, the global aviation industry is poised to a new round of growth, driven by strong demand rebound and improved airline profitability, along with enormous development opportunities emerged. At the same time, we believe that the USD interest rate has reached its peak, and the rate cut cycle is expected to start in 2024, which shall help reduce market capital costs and speed up the recovery of the aircraft trading market. In the face of such an accommodative market, CALC will continue to seize business opportunities arising from the rapid recovery of global markets and the trend towards greener aviation, while strengthening its capabilities in providing comprehensive fleet upgrade services.

Mr. Conrad Li, Executive Director and Chief Financial Officer of CALC added, “Additionally, the Group will actively explore market interest in aircraft assets while continue to capitalize on a strong trading market and further enhance our credit profile through continuous optimization of our financial structure. For the coming year, we have full confidence to maintain CALC’s long-term sustainable and favorable growth, striving to become an international investment-grade company yet continuing to explore market opportunities for business expansion, creating better value for our shareholders and investors.”

(1) Figures adjusted by excluding exceptional and non-cash item related to impairment on CAG project to better reflect the company’s performance.

About CALC
China Aircraft Leasing Group Holdings Limited (CALC) is a one-stop aircraft full value-chain solutions provider for global airlines. The businesses and subsidiaries of the Group are engaging in two main businesses of new aircraft leasing and aircraft aftermarket services. CALC’s scope of business includes conventional businesses such as aircraft operating leasing, purchase and leaseback, and structured financing, as well as value-added services such as fleet planning, fleet upgrade, aircraft disassembling and component sales. CALC is one of the world’s top 10 aircraft lessors in terms of the combined asset value of fleet and order book, according to ICF International.

CALC is listed on the Main Board of the Stock Exchange of Hong Kong Limited (HKG: 1848) as the first aircraft leasing company in Asia in July 2014. CALC is currently a MSCI China Small Cap index.