4. Investments

On May 25, 2011, we entered into an agreement with Mitsui & Co., Ltd. to participate in a joint venture formed as a Dublin-based Irish limited company — Willis Mitsui & Company Engine Support Limited (“WMES”) for the purpose of acquiring and leasing jet engines. Each partner holds a fifty percent interest in the joint venture and the Company uses the equity method in recording investment activity. The investment has decreased to $31.8 million as of March 31, 2017 as a result of the Company receiving $1.9 million in distributions, recording $0.4 million as deferred gain as a result of the Company selling an engine to WMES and the Company’s share of WMES reported income of $1.6 million during the three months ended March 31, 2017.

On June 3, 2014 we entered into an agreement with China Aviation Supplies Import & Export Corporation (“CASC”) to participate in a joint venture named CASC Willis Engine Lease Company Limited (“CASC Willis”), a new joint venture based in Shanghai, China. Each partner holds a fifty percent interest in the joint venture. In October 2014, we made a $15.0 million initial capital contribution, representing our fifty percent, up-front funding contribution to the new joint venture. The company acquires and leases jet engines to Chinese airlines and concentrates on meeting the fast growing demand for leased commercial aircraft engines and aviation assets in the People’s Republic of China. During the three months ended March 31, 2017 the Company recording $0.5 million as deferred gain as a result of the Company selling an engine to CASC Willis, recorded $0.1 million foreign currency translation adjustment and the Company’s share of CASC Willis reported income of $0.2 million. Our investment in the joint venture is $12.8 million as of March 31, 2017.


Three Months Ended March 31, 2017	WMES		CASC		Total
	(in thousands)
Investment in joint ventures as of December 31, 2016	$	32,470	$	12,936	$	45,406
Earnings from joint venture		1,635		219		1,854
Deferred gain on engine sale		(443)		(496)		(939)
Distribution		(1,880)		—		(1,880)
Foreign Currency Translation Adjustment		—		99		99
Investment in joint ventures as of March 31, 2017	$	31,782	$	12,758	$	44,540

“Other revenue” on the Consolidated Statement of Income includes management fees earned of $0.8 million and $0.6 million during the three months ended March 31, 2017 and 2016, respectively, related to the servicing of engines for the WMES lease portfolio. “Gain on sale of leased equipment” on the Consolidated Statement of Income includes $0.9 million for the three months ended March 31, 2017 related to the sale of an engine to WMES ($0.4 million gain) and the sale of an engine to CASC Willis ($0.5 million gain). “Gain on sale of leased equipment” on the Consolidated Statement of Income includes $1.2 million for the three months ended March 31, 2016 related to the sale of four engines to WMES for $46.1 million. As 50% owners of WMES and CASC Willis, we deferred these gains to our investment which is being amortized over a 15-year period to a 55% residual value.

Summarized financial information for 100% of WMES is presented in the following tables:


	Three Months Ended March 31,
	2017		2016
	(in thousands)
Revenue	$	11,661	$	9,246
Expenses		8,430		9,180
WMES net income	$	3,231	$	66


		March 31,		December 31,
		2017		2016
	(in thousands)
Total assets	$	273,121	$	293,299
Total liabilities		200,265		219,881
Total WMES net equity	$	72,856	$	73,418