11. Reportable Segments

The Company has two reportable segments: (i) Leasing and Related Operations which involves acquiring and leasing, primarily pursuant to operating leases, commercial aircraft, aircraft engines and other aircraft equipment and the selective purchase and resale of commercial aircraft engines and other aircraft equipment and other related businesses and (ii) Spare Parts Sales which involves the purchase and resale of after-market engine and airframe parts, whole engines, engine modules and portable aircraft components.

The Company evaluates the performance of each of the segments based on profit or loss after general and administrative expenses. While the Company believes there are synergies between the two business segments, the segments are managed separately because each requires different business strategies.

During the second quarter of 2018, the Company moved certain sales of leased equipment to the Spare Parts Sales segment from the Leasing and Related Operations segment and had no change in the determination of operating segments. In accordance with ASC 280-10, the Company has restated prior period information presented below to reflect this change in composition of its reportable segments.

The following tables present a summary of the reportable segments (in thousands):


	Leasing and
Three months ended September 30, 2018	Related Operations		Spare Parts Sales		Eliminations (1)		Total
Revenue:
Lease rent revenue	$	46,984	$	—	$	—	$	46,984
Maintenance reserve revenue		19,370		—		—		19,370
Spare parts and equipment sales		—		8,354		—		8,354
Gain on sale of leased equipment		1,150		106		—		1,256
Other revenue		2,010		274		(274)		2,010
Total revenue		69,514		8,734		(274)		77,974

Expenses:
Depreciation and amortization expense		19,771		90		—		19,861
Cost of spare parts and equipment sales		—		5,848		—		5,848
Write-down of equipment		1,215		—		—		1,215
General and administrative		17,003		1,121		—		18,124
Technical expense		2,290		—		—		2,290
Interest expense		17,885		—		—		17,885
Total expenses		58,164		7,059		—		65,223
Earnings from operations	$	11,350	$	1,675	$	(274)	$	12,751

	Leasing and
Nine months ended September 30, 2018	Related Operations		Spare Parts Sales		Eliminations (1)		Total
Revenue:
Lease rent revenue	$	129,710	$	—	$	—	$	129,710
Maintenance reserve revenue		56,855		—		—		56,855
Spare parts and equipment sales		—		21,701		—		21,701
Gain on sale of leased equipment		1,917		225		—		2,142
Other revenue		5,716		1,596		(1,550)		5,762
Total revenue		194,198		23,522		(1,550)		216,170

Expenses:
Depreciation and amortization expense		55,336		264		—		55,600
Cost of spare parts and equipment sales		—		16,537		—		16,537
Write-down of equipment		4,793		—		—		4,793
General and administrative		47,181		3,336		—		50,517
Technical expense		9,199		—		—		9,199
Interest expense		46,617		—		—		46,617
Total expenses		163,126		20,137		—		183,263
Earnings from operations	$	31,072	$	3,385	$	(1,550)	$	32,907


	Leasing and
Three months ended September 30, 2017	Related Operations		Spare Parts Sales		Eliminations (1)		Total
Revenue:
Lease rent revenue	$	33,474	$	—	$	—	$	33,474
Maintenance reserve revenue		20,370		—		—		20,370
Spare parts and equipment sales		—		9,294		—		9,294
Gain on sale of leased equipment		22		152		—		174
Other revenue		2,538		247		(236)		2,549
Total revenue		56,404		9,693		(236)		65,861

Expenses:
Depreciation and amortization expense		16,056		86		—		16,142
Cost of spare parts and equipment sales (2)		—		7,148		—		7,148
Write-down of equipment (2)		6,226		—		—		6,226
General and administrative		13,387		921		—		14,308
Technical expense		2,605		—		—		2,605
Interest expense		14,220		—		—		14,220
Total expenses		52,494		8,155		—		60,649
Earnings from operations	$	3,910	$	1,538	$	(236)	$	5,212

	Leasing and
Nine months ended September 30, 2017	Related Operations		Spare Parts Sales		Eliminations (1)		Total
Revenue:
Lease rent revenue	$	95,045	$	—	$	—	$	95,045
Maintenance reserve revenue		64,212		—		—		64,212
Spare parts and equipment sales		19,300		21,973		—		41,273
Gain on sale of leased equipment		4,463		221		—		4,684
Other revenue		6,314		697		(572)		6,439
Total revenue		189,334		22,891		(572)		211,653

Expenses:
Depreciation and amortization expense		48,526		260		—		48,786
Cost of spare parts and equipment sales (2)		14,623		17,498		—		32,121
Write-down of equipment (2)		19,668		—		—		19,668
General and administrative		38,008		2,566		—		40,574
Technical expense		7,345		—		—		7,345
Interest expense		36,398		—		—		36,398
Total expenses		164,568		20,324		—		184,892
Earnings from operations	$	24,766	$	2,567	$	(572)	$	26,761

(1)

Represents revenue generated between our operating segments.

(2)

The amounts herein include reclassifications of scrap inventory write-offs and lower of cost or market write-downs that were previously presented within Write-down of equipment to the Costs of spare parts and equipment sales expense line item. The three and nine months ended September 30, 2017 were impacted by a reclassification of $0.7 million and $2.6 million, respectively, reflected as an increase to Cost of spare parts and equipment sales and a decrease to Write-down of equipment.


	Leasing and
	Related Operations		Spare Parts Sales		Eliminations		Total
Total assets as of September 30, 2018	$	1,919,003	$	46,193	$	—	$	1,965,196
Total assets as of December 31, 2017	$	1,556,406	$	47,025	$	—	$	1,603,431