Aircraft and Aircraft Engines Held for Lease or Sale

9 Months Ended

Sep. 30, 2016

Aircraft and Aircraft Engines Held for Lease or Sale [Abstract]

Aircraft and Aircraft Engines Held for Lease or Sale

3.Aircraft and Aircraft Engines Held for Lease or Sale

(a)Assets Held for Lease

At September 30, 2016 and December 31, 2015, the Company's aircraft and aircraft engines held for lease consisted of the following:

	September 30, 2016					December 31, 2015
Type	Number owned		% of net book value			Number owned		% of net book value
Turboprop aircraft		12		23	%		16		45	%
Regional jet aircraft		12		73	%		8		49	%
Engines		4		4	%		5		6	%

In August 2016, the Company purchased two Bombardier CRJ-1000 aircraft on lease to a regional carrier in Europe and assumed the debt related to these aircraft.  Each aircraft is held in a single asset special-purpose subsidiary of the Company, funded by the Company.

In September 2016, the Company purchased two Bombardier CRJ-900 aircraft on lease to a current customer in Europe.

During the third quarter of 2016, the Company used cash of $52,138,000 for acquisition of aircraft and related costs.  During the second quarter of 2016, the Company made deposits and paid acquisition costs totaling $971,100 related to aircraft acquired during the third quarter.  At the time of purchase, the Company received $17,179,300 of maintenance reserves related to two of the aircraft; such reserves are reflected as a deduction in the amount of cash used for purchases and related acquisition costs in the investing activities section of the Company's statement of cash flows for the nine months ended September 30, 2016.   The Company used no cash for aircraft acquisitions during the third quarter of 2015.

Six of the Company's assets held for lease, comprised of four turboprop aircraft and two engines, were off lease at September 30, 2016, representing 7% of the net book value of the Company's aircraft and engines held for lease.   The Company has a signed lease and deposit for one of the aircraft and expects to deliver it during the fourth quarter of 2016.

As of September 30, 2016, minimum future lease revenue payments receivable under noncancelable operating leases were as follows: 

Years ending
Remainder of 2016	$	7,302,600
2017		26,406,900
2018		22,312,500
2019		21,685,600
2020		19,455,200
Thereafter		43,209,700
	$	140,372,500

(b)Assets Held for Sale

During the third quarter of 2016, the Company sold a spare engine that had been written down to its net sales price at June 30, 2016 and classified as held for sale. 

Assets held for sale at September 30, 2016 included a turboprop aircraft and three turboprop airframes being sold in parts. During the three months ended September 30, 2016 and 2015, the Company received $38,600 and $19,000 respectively, from the sale of parts belonging to the airframes, which proceeds reduced the airframe's carrying values.  During the third quarter of 2016, with respect to one of those airframes, the Company received in excess of its carrying value and recorded a gain of $2,800.