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Airline Leasing Sector Takes Off

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    Aircastle CEO Ron Wainshal on the growth of airline leasing.

  • Duration 4:14
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You're the sluggish global economy is not stopping one airline leasing business from taking off Aircastle as a company it's taking advantage.

-- European debt crisis to its advantage joining us now gonna Fox Business exclusive -- -- shop he's the Aircastle CEO and and this really caught our -- to be able to say.

That the European banking prices is actually a positive for you guys explain to our viewers -- because you are publicly traded company.

And people are always looking for something to invest in.

Blues hundred here hundred billion dollars an aircraft will be delivered this year and the shrinkage in the European Bank market.

Mean somebody else has to fill that gap meaning financing exactly black people go to the banks to finance -- these things are not cheap they're not.

So this year so far we've put 700 million dollars of commitments in place in terms of -- investments palace are targeted to -- -- in the every kind of hit that halfway through.

So very we're really excited about that's a great time to invest provided that you have a way financing -- and we did.

-- tapped into the capital markets in the last and we've been a repeated assurance it's a good time for us.

On your screen are as some of your clients -- KLM Iberia these are foreign airlines which also got US Airways southwest Air Canada as in there.

I'll rent vs spy it's in recent lot of lease a car.

You may not have the money you may not want to take the residual risk -- I want flexibility same thing with the airlines whether you're strong airline collect Cathay Pacific whenever customers.

Where your weaker airline or rapid growth airline leasing companies offer you a way of getting financing -- -- flexibility OK so any you have so many fingers -- so many different parts of the globe when it comes to some of these airlines.

Where he could see stronger regions that that growth in our business has come from emerging economies has changed in case of travel totally.

In fact about two years ago Asia eclipsed north America's.

Most traveled sector in the world and that's a shocking fact a lot of people.

About a third -- -- deliveries have gone into China and they're there to near term areas so we see big growth in Asia we see good growth in Brazil.

-- south East Asia in particular we see good growth in Turkey where the weak spots weak spots here.

And Europe has been weak for some time.

And the great thing about airplanes is it to portables if -- long life assets a lot like you'll state but differences if your landlord.

And the market churn is bad you can't move your craft somewhere else the world where demand is good.

Our portfolio has shrunk in Europe and it's -- -- nation.

So you can turn it take appointments not being used or cannot -- afford to be used in Europe and -- it over to Singapore -- -- bet -- job always is to find the highest and best use of the aircraft -- -- there for publicly traded companies that do this three other than yourself and we can -- some of the competitors up there but.

Here's your stock over the past year it is up just about -- -- slightly but you know the trailing PE is also very expensive it's about eight.

We like to look at cheap stocks that are that are you know not too expensive for people to get in as far as -- barrier to entry is concerned.

We always ask because nothing's guaranteed.

You've got a dividend that you pay out and it's a pretty good one about 5% -- what would force you to either cut it.

Or suspend -- you know because we saw back during the financial crisis where of GE had to be forced to do something like that we always -- asset because people are getting into certain stocks like yours because of -- Positive dividend.

At the conservative capital structures -- starting point we have very low leverage it's about two parts that one part equity.

We have no debt maturities for five years.

-- And our philosophy is to pay -- sustainable dividend.

Where as we grow we'll share in that growth in terms of the dividend I -- it helps a lot that you happier BA and -- economics from Wharton.

Right.

Yeah -- health -- a good school -- event but the real -- a good school -- so with the Fed gonna move got to ask you as a business owner Tom I think there's there's still a lot of uncertainty economy that's one of the the overhang sin in in in all business from the world.

And so anything that gets confidence going is important always -- -- -- is the Aircastle CEO thank you so much for joining -- ridiculous that we here on Fox Business David should.

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