WLFC

Image source: The Motley Fool. Tuesday, Aug. 4, 2026 at 10:00 a.m. ET Chief Executive Officer - Austin Willis Executive Vice President and Chief Financial Officer - Scott Flaherty Need a quote from a Motley Fool analyst? Email [email protected] Operator: Good day, and welcome to the Willis Lease Finance Corporation Q2 2026 Earnings Conference Call. Today's conference is being recorded. We would like to remind you that during this conference call, management will be making forward-looking statements, including statements regarding our expectations related to financial guidance, outlook for the company and our expected investment and growth initiatives. Please note that these forward-looking statements are based on current expectations and assumptions, which are subject to risks and uncertainties. These statements reflect WLFC's views only as of today. They should not be relied upon as representative of views as of any subsequent date, and WLFC undertakes no obligation to revise or publicly release the results of any revision to these forward-looking statements in light of new information or future events. These statements are subject to a variety of risks and uncertainties that could cause actual results to differ materially from expectations. For further discussion of the material risks and other important factors that could affect WLFC's financial results, please refer to its filings with the SEC, including, without limitation, WLFC's most recently quarterly report on Form 10-Q, annual report on Form 10-K and other periodic reports, which are available on the Investor Relations section of WLFC's website at https://www.wlfc.global/investor-relations. At this time, I would like to turn the conference over to Mr. Austin Willis, CEO. Please go ahead. Austin Willis: Thank you, operator, and thank you all for joining us today to discuss Willis Lease Finance Corporation's Second Quarter 2026 Financial results. On our call today, I am joined by Scott Flaherty, our Chief Financial Officer. I would like to also point you to the Investor Center section on our website, where we have posted a presentation to give further details supporting our prepared remarks, along with our earnings press release. We are pleased to have continued strong momentum from earlier in the year and are reporting another quarter of solid financial and operational performance. We continue to deliver on our strategy to grow assets under management and have increased this from roughly $3.6 billion in quarter 2 2025 to about $4.4 billion in quarter 2 2026. Furthermore, we delivered strong EBT performance of $38 million and an adjusted EBITDA of $120.7 million in an uncertain geopolitical environment. Before discussing our business segments, it's worth briefly touching on the broader operating environment. The macro environment has been dynamic in the second quarter and remains so. While geopolitical events, including the conflict in Iran, created some temporary market disruption, the underlying fundamentals of our business remain strong. As I will discuss later, one of the strengths of WLFC is our ability to perform across different market environments, supported by our integrated platform and the flexible solutions we provide to our customers. While the war in Iran hasn't affected the demand for our assets, it has had some effect on the volume of aircraft and engine transactions taking place. Similarly, during the second quarter, we saw a reduction in short-term maintenance reserve revenue, which appears to be the result of customers flying fewer hours on less fuel-efficient platforms such as the A320ceo and 737NGs, powered by CFM56 and V2500 engines. By comparison, the more modern engines like LEAP and GTF did not see the same reduction in flight hours as they were favored due to their fuel efficiency and, in fact, had an increase in flight utilization in many cases. It is also partly due to the modernization of our fleet, which Scott will speak to in a moment. Encouragingly, the maintenance reserve revenues from older engine types are improving along with trade volume. As the aircraft OEMs ramp up production of the A320neos and 737 MAX aircraft, we see the long-term prospects for LEAPs and GTF demand remaining robust. While both aircraft platforms have had entry into service difficulties driven primarily by the engine-related technical issues, the engines are now beginning to reach a point of maturity where scheduled removals for performance restoration and LLP replacement are beginning to accelerate. As a result, we expect the LEAP and GTF engines to require more frequent off-wing maintenance. And this, combined with the maturing of the engine type is likely to lead to strong demand for these engines. About 60% of our consolidated portfolio by net book value, including WLFC and WAC, consists of modern tech engines, including LEAP, GTF and GEnx, reflecting our investments in these modern platforms for the past few years. We are well positioned to serve this growing base of aircraft and engines into the next decade. We expect the CFM56 and V2500s to continue as big contributors to our bottom line as well. However, we remain prudent, as always, in our decisions to buy assets, understanding that as the market matures, these assets will be phased out in favor of more modern technology. We believe we're well positioned to benefit from this phaseout as our product constant thrust is designed specifically to facilitate these transitions. And our maintenance philosophy of hospital shop visits in lieu of full overhauls will become an increasingly attractive alternative to costly full overhauls. With the hiring of David Hooke last year, we focused more on M&A in 2026. We have participated in a number of marketed processes and some off-market deals as well. Of the opportunities we are seeing, sellers are increasingly preferring to transact through the sale of entities that own the underlying assets rather than through direct sales of assets in order to avoid lengthy novation processes. While this has created opportunities for us to acquire assets at attractive prices, acquiring them through special purpose vehicles also introduces the additional costs and complexity associated with the M&A transactions. These types of costs are reflected in SG&A, but are also carefully factored into our investment decisions. We were pleased to announce 2 M&A-type transactions recently where we acquired assets through special purpose vehicles, and I'll speak more to that in a moment. Moving on to discuss the Willis platform and our primary business segments. Total assets under management grew from $3.6 billion in Q2 2025 to $4.4 billion in Q2 2026, a significant increase of 21%. Our assets on balance sheet made up 67% of assets under management. Next, I'll give an update on our primary business areas: leasing, Willis Aviation Capital and Services. Starting with leasing. Our leasing business is performing well as we have been focused on reallocating assets to different pockets of capital in order to execute our growth strategy across both our balance sheet business as well as WAC. We saw solid utilization of our lease portfolio in Q2, averaging about 85%, roughly equivalent to the prior quarter. This does fluctuate from time to time as engines go into maintenance, programs roll on and off, we move assets on and off balance sheet and when we acquire new assets off lease. In June, we acquired the vehicles that own 3 Airbus A330-300 aircraft that were leased to China Airlines and EVA Air. Then in July, we signed definitive documentation to acquire the private equity entities that own an additional 12 commercial aircraft and 13 aircraft engines. These acquisitions provide us the opportunity to expand our portfolio and customer base. We intend to use our platform and programs to extract additional value from these assets as well. As I mentioned earlier, Willis Aviation Capital, or WAC, grew to $1.4 billion in Q2 2026, representing an increase of nearly 80% from its AUM the same period last year. The muted growth of the balance sheet assets was largely the result of having seeded the portfolios of the Blackstone Fund, the Liberty Mutual Fund and our joint venture with Mitsui. The seeding is now largely complete, and we expect the majority of further growth in the funds to come through third-party market purchases. This will help build out both our AUM as well as our balance sheet portfolio, which still represents the primary source of income for WLFC. As we stand today, we have roughly $1.3 billion of additional capital ready to deploy in our discretionary funds, which is in addition to the capital raised by our joint ventures and the WLFC capital structure. This liquidity, along with the undrawn revolver capacity and our low leverage of 2.78x provides added flexibility and will allow us to execute our growth strategy. Finally, Services. Our Services businesses continue to be a major strategic advantage, differentiator and value creator, both for our own assets and those we manage. After nearly a year of on-site inspections and quality audits, we were pleased to announce last week that we signed a major engine storage agreement with Pratt & Whitney. I believe this is indicative of the confidence they have placed in us, both as a customer and a service provider. We intend to be good custodians of their assets at our maintenance facilities in the United States, in the United Kingdom as well as other engine repair centers we may establish in the future. We are currently in advanced discussions to establish another center in Asia, and we hope to have news for you on that in the near future. The Willis Engine Repair Center or WERC, is a replicable solution we can duplicate quickly in different geographies. I also want to reiterate our commitment to allocating our capital to supporting growth, maintaining leverage targets and providing a nominal return of capital through a dividend to our shareholders. In support of that goal, we recently declared a quarterly dividend of $0.133 per share, which when adjusted for our 3-for-1 stock split is equivalent to our prior dividend. As the market recognizes the growth and value of the Willis platform, we're pleased to see a broadening of our inclusion into various Russell 2000 indices as well as an increased trading volume in our securities, which provides more liquidity to our shareholders. Trading volume in our equity on a dollar volume basis has increased 82% in 2026 compared to 2025. Overall, we have achieved another strong quarter, and we are confident in the progress we are making to scale our global platform, expand our portfolio and deliver long-term value for shareholders. This year, we have been focused on moving assets from our balance sheet to Willis Aviation Capital. Now that this is largely complete, we look forward to a return to balanced growth by closing on our significant pipeline. And with that, I'll hand it over to Scott Flaherty, our CFO, to discuss our financial performance in greater depth. Scott Flaherty: Thank you, Austin, and good morning all. Q2 was another strong quarter for Willis Lease as our core leasing business produced solid revenues, profitability and cash flows. We continue to vertically integrate our services solutions platform, further differentiating our product offering, creating cross-sell opportunities and affording both Willis and our customers the benefit from the most economical maintenance solutions. The second quarter also provided for further seeding of our Blackstone and Liberty fund portfolios as well as the continued build of our Willis Mitsui joint venture. The second quarter's $194 million of revenues produced $38.1 million of earnings before tax or EBT. $28.7 million of net income attributable to common shareholders and $1.31 of diluted earnings per share as well as $120.7 million of adjusted EBITDA. Walking through the P&L, our quarterly top line was driven by solid lease rent revenues of $77.1 million in the quarter, 6.7% year-over-year growth in lease rent revenue driven by a marginal increase in the average portfolio size as we built assets year-over-year, while at the same time seeding our fund businesses. Our owned portfolio reflected on balance sheet as equipment held for operating lease maintenance rights, notes receivable and investments in sales-type leases at the end of the second quarter was $2.96 billion in book value. Average utilization was down from 87.2% in the second quarter of 2025 to 85% in the second quarter of 2026. That said, we saw strength in lease rates as our average lease rate ticked up from 1.0% to 1.03% in the comparable year-over-year periods. Maintenance reserve revenues for the quarter were $46.5 million, down from $50.7 million in the prior comparable period. $39 million of these revenues were short-term maintenance reserves as compared to $50.2 million in Q2 2025. Short-term maintenance reserve revenues are a proxy for both the number of engines that we have on short-term lease conditions as well as the operating tempo of these engines. The average number of engines that we had on short-term conditions declined by 4.9% from the comparable prior quarter as the portfolio mix shifted slightly towards new tech engines, which tend to be on long-term leases. We also saw a reduction in hours and cycles in April and May by certain operators due to elevated fuel pricing. At the tail end of the second quarter, we started to see a recovery in operating tempo and the related maintenance reserve revenues as a cease fire took hold in Iran and fuel prices began to decline. $7.5 million of these maintenance reserve revenues were long-term maintenance reserve revenues in Q2 2026 associated with engines coming off long-term leases compared to $0.5 million in Q2 2025. $6.8 million of these revenues related to one V2500 coming off long-term lease and the release of its maintenance reserves. Spare parts and equipment sales were $21.2 million in the quarter compared to $30.4 million in the comparable period in 2025. Spare parts sales were $11.1 million in Q2 2026, up 19.7% from $9.2 million in the comparable prior quarter. Gross margins on spare parts sales were 10%. Sales reflected in the consolidated P&L are net of $8 million of intercompany sales that are transacted at cost but provide incremental value to the consolidated businesses. Equipment sales in the second quarter of 2026 were $10.1 million compared to $21.1 million in the prior comparable period. These Q2 2026 revenues reflect the sale of 2 engines and 1 airframe that were not part of the lease portfolio. The trading profit on sale of this equipment was $5 million, representing a 49% gross margin. Gain on sale of leased equipment, a net revenue metric, aggregated to $32 million in the second quarter, up $4.6 million from $27.6 million in the comparable prior period. The $32 million gain on leased equipment was associated with the sale of 21 engines and other parts and equipment for $224.8 million, less economic closing adjustments, representing a gross margin of 14.2%. Included in these sales were 14 engines sold as part of our seed portfolio to a Blackstone fund. We are predominantly done with seeding our fund portfolios and we'll now focus on growing our assets under management, including the balance sheet portfolio with purchases from third parties. The company recognized $0.2 million of gain on sale of financial assets where we sold one engine recorded on our balance sheet as a note receivable for $16.8 million. The sale of these financial assets are generally part sales. Maintenance services revenue, which represents fleet management, engine and aircraft storage and repair services and revenues related to management of fixed base operator services increased by $1 million or 11.9% to $9 million in Q2 2026. This growth reflects the growth of engine and aircraft storage and was partially offset by the sale on 6/30/2025 of our fleet management or BAML business to our Willis Mitsui joint venture. Gross margin was a negative $1.4 million and influenced by the seasonality of the base maintenance activity in the second quarter. Our maintenance service offerings enhance our ability to provide a differentiated offering and program solution to our customer base as well as vertical integration to increase the profitability of our owned and managed assets. Intercompany maintenance services are not reflected in our P&L, but would represent 21% of our gross maintenance service sales in the second quarter. Management and advisory fees, the fees generated through our asset management efforts were $5.5 million in the quarter, up $2.9 million or 113%, which was primarily driven by $2.8 million of fees earned from our Blackstone and Liberty Mutual Funds in the company's role as GP. These fees also include fees earned from our Willis Mitsui joint venture and to a lesser extent, our CASC joint venture in Shanghai. The Blackstone fund commenced operations in April of this year, and the LMI fund commenced operations in March. The company recognized $1.4 million in other revenue during the 3 months ended June 30, 2026, compared to $0.3 million in the prior year period. Other revenue was primarily attributable to lease end billings to satisfy lessee lease-end contractual conditions. On the expense side of the equation, depreciation and amortization expense increased by $1.5 million or 5.5% to $29.1 million in Q2 2026 compared to $27.6 million in the prior comparable period. The increase is primarily due to an increase in the size of our lease portfolio and the timing of placing acquired engines on lease. Write-down of equipment was $4.9 million in the second quarter, reflecting the write-down of 4 engines. There was $11.5 million in write-downs of equipment in the comparable prior period, reflecting the write-down of 6 engines. General and administrative expenses increased by $5.1 million to $55.6 million in the second quarter compared to $50.4 million in the prior comparable period. The increase was primarily driven by the prior comparable period, including $6.3 million in government grant receipts for the now discontinued sustainable aviation fuel project, along with the current period including a $2.7 million increase in legal fees, primarily related to the company's financing and strategic initiatives. These increases were partially offset by a $3.4 million decrease in personnel costs primarily reflecting $4.0 million reduction in share-based compensation resulting from changes made to the structuring of new employee equity awards following the appreciation in the company's stock price. General and administrative costs also included $1.6 million of costs, which were recharged to the LMI fund and Blackstone Fund with the associated revenue of $1.6 million included in management and advisory fees. As we look forward, based upon the January 2025 changes to our share-based compensation program, we would expect pursuing consistent practices that this expense would continue to decline, approaching 50% of its estimated 2026 cost in 2028. Technical expense increased by $2.4 million to $9.9 million for the 3 months ended June 30, 2026, compared to $7.5 million in the prior comparable period due to increased level of engine repair activity as compared to that of the prior period. Technical expense generally relates to unplanned maintenance, whereas engine performance restorations tend to be planned and capitalized events. Net finance costs increased $1.5 million or 4.6% to $35.1 million for the 3 months ended June 30, 2026, compared to $33.6 million in the prior comparable period. The increase was primarily attributable to a $5.4 million loss on debt extinguishment recognized in the current period with no comparable loss in the prior period, resulting from the company's refinancing and capital restructuring activities, $1.5 million of the $5.4 million loss in the quarter and $7.6 million of the $12.4 million loss year-to-date was noncash and reflected an acceleration of previously incurred debt issuance costs. Income from operations was $34 million, up 20.2% from the prior comparable period. The company also picked up $4.2 million in ratable earnings from our investments, which predominantly consisted of investments in our Willis Mitsui joint venture and our Blackstone and Liberty funds. Earnings before tax or EBT of $38.1 million for the quarter as compared to EBT of $74.3 million for the prior comparable period, which included a onetime gain of $43 million associated with our sale of BAML business to our joint venture. Income tax expense was $7.8 million for the second quarter of 2026, which reflects a 20.5% effective tax rate as compared to an 18.7% rate in the prior comparable period, both of which were lower than the U.S. federal statutory rate of 21%. The rate for the second quarter of 2026 was positively impacted by a worthless stock deduction the company recognized on a foreign subsidiary involved in the discontinued sustainable aviation fuel project. The prior comparable period separately benefited from no statutory tax being owed on the sale of the BAML business. The company produced $28.7 million of net income attributable to common shareholders, which factors in GAAP taxes, net income attributable to our noncontrolling interest and the cost of our preferred equity. Diluted weighted average income per share was $1.31 in the second quarter of 2026. Diluted weighted average income per share in the prior comparable period was positively impacted by a onetime gain on the sale of our BAML business, which was affected on a tax-free basis. Adjusted EBITDA for the second quarter of 2026 was $120.7 million, up 4% from $116.1 million in the second quarter of 2025. We believe that our adjusted EBITDA reflects the normalized cash flow generation capability of the Willis enterprise. Our adjusted EBITDA makes adjustments to our net income attributable to common shareholders for income tax expense, interest expense, preferred stock dividends and costs, loss on debt extinguishment, depreciation and amortization expense, stock-based compensation expense, write-down of equipment, acquisition financing and divestitures-related expenses and other discrete gains and expenses. Net cash provided by operating activities year-to-date was $134.2 million compared to $145.2 million in the comparable period of 2025. Fluxes with the prior period predominantly related to changes in net income, losses on debt extinguishment, the net effect of gains on the sale of leased equipment and the gain on sale of our BAML business and a period-over-period $18.4 million decrease in cash provided by changes in assets and liabilities. On the financing and capital structure side of the business, the company issued in May $200 million aggregate principal amount of 2.5% convertible senior notes due 2031. We utilized these proceeds, our first unsecured to delever our $1.75 billion revolving credit facility and to provide the business more flexibility to evolve its business strategy. The notes convert at a split adjusted share price of $89.60 per share, which represented a 40% premium at issuance and are immediately accretive to the P&L as we convert higher cost revolver leverage to lower coupon convertible debt. We amended our revolving credit facility to allow for the convertible issuance under the documents covenant structure. We also effected a 3-for-1 stock split to provide for incremental liquidity to our investor base, which became effective on July 21, 2026. In May, we paid our eighth consecutive regular quarterly dividend, which was $0.40 per share. Subsequent to quarter end, our Board of Directors has declared our ninth consecutive recurring quarterly dividend, which is at a split adjusted rate of $0.133 per share payable to holders at August 11, 2026, on August 21, 2026. Our recurring dividend provides shareholders with a moderate current cash yield on their investment while not degrading the strong cash flow of our business. With respect to leverage, as defined as total debt obligations, net of cash and restricted cash to equity, inclusive of preferred stock, our leverage was 2.78x at the end of the second quarter of 2026. We have made significant strides over the last several years to reduce leverage to position Willis to be able to access market opportunities when they become available, not unlike the $379 million leased aircraft and engine portfolio transaction we announced as a Q2 subsequent event in July. With that, I will hand the call back to Austin. Austin Willis: Thank you, Scott. As you can see, we are delivering on our strategy to supplement our balance sheet leasing business with asset management. We're deploying capital in a steady, judicious way. With that, I'd like to open up the call for Q&A. Operator: [Operator Instructions] And we'll go to your first question, and that will come from the line of Jordan Hymowitz with Philadelphia Financial. Jordon Hymowitz: On a great quarter. Can you talk a little bit about the assets you've put into the SPV and the mark on them and how it kind of highlights the undervaluation of the current marks on your balance sheet? Austin Willis: Jordan, thanks for the question. I'll touch on the first part, and I'll ask Scott to talk to the second part. The composition of the portfolio broadly echoes what we have in our broader portfolio. So you're going to see it looking essentially like the portfolio on our own balance sheet. It's really, really not much different. And that was the point of the Blackstone fund. On the Liberty Mutual side, it's primarily finance leases or loans and loan-like products. So the few finance leases we had on our balance sheet, we migrated the majority of those over. And Scott, do you want to touch on the second point? Scott Flaherty: Sure. Sure. Jordan. As you heard in our prepared remarks, we sold about $224 million of assets and recognized a $32 million gain on those assets. So that's 14.2%. I think as we've talked about the mark of the overall portfolio, and as you know, we do this on an annual basis, we see that the overall portfolio is coming in at about 20% below the value that we have appraised. So the book value that we have is -- theoretically, if one were to sell the overall portfolio and compare that to where the market value of the overall portfolio is based on industry appraisals, there'd be an embedded 20% gain. Austin Willis: But you also have to keep -- sorry, this is Austin again. You also have to keep in mind the granular nature of what we sell. Sometimes you're going to have some assets that have higher book value, some have lower book values. It's just going to depend upon what happens to get moved over. Jordon Hymowitz: But similar to AerCap, which has been a phenomenal story for a dozen years, they're getting similar levels of gains. And again, not everything is comparable. But it's similar in that the asset is appreciated so much that the book value is inherently understated. Is that a -- broadly, is that a fair statement? Scott Flaherty: I think that is. And I also think I kind of draw your attention to our spare parts and equipment sales. And we did pick up on equipment sales of 50% or 49% gross margin on those. So to Austin's point, it's granular, and you really have to look at the portfolio in its entirety. Jordon Hymowitz: And if I could just follow one more quick thing. I mean it's unfortunate that all the people that you paid money to underwrite to convert you have yet to pick up coverage, which is very disappointing. But hopefully, that will happen. And my question is, when they do, do you think you'll be similar to what AerCap does in guiding to earnings without gains? Or will they be with gains? Or might it be some combination? Scott Flaherty: Well, I don't want to -- Jordan, I don't want to get ahead of ourselves on guidance, but your point is taken. Operator: Your next question will come from the line of Will Waller with M3. William Waller: Can you talk about the capacity you see for the asset management business and how that might grow in the future and the type of institutional demand you're seeing for those products, realizing there's kind of 2 different products with the Liberty Mutual product and the one that was -- that Blackstone invested in. So just kind of curious to hear if you're seeing additional demand for the potential of future funds in future years and what type of product mix there might be? Austin Willis: Will, this is Austin. Thanks for the question. The answer is yes. We are seeing a lot of demand for the product. Since we closed on the funds, we've received a lot of inbounds from institutional investors looking to replicate that. Our focus for the time being is deploying the capital that we've raised. But I think I mentioned this in a previous earnings call. The 2 discretionary funds we raised, it's not a one-off for us. This is not intended to be sort of a one-off sidecar. This is a genuine long-term asset management strategy. So our intention is to deploy the capital in these 2 funds and then go out and raise additional larger funds in the future, really relying on our platform to deliver a premium return to the investors. William Waller: Great. That sounds great. And then a second question for you is, historically, long-term leases versus the short-term lease mix was around 50%. With the sort of uncertainty that exists in the aviation market with higher fuel prices, has there been a shift at all to shorter-term leases? Or is that mix still around 50%? Austin Willis: It's still around 50%. The term of our leases is a little bit shorter than it was last year, but I wouldn't attribute that to anything really in particular. It's still about 50-50. William Waller: Okay. So you haven't seen kind of a change in the last 2 months or something with as new leases are being originated or as leases are coming due that there's a demand for a lot shorter-term lease. We had kind of heard at a conference recently on a panel that, that was the case in the industry, but it sounds like you're probably not seeing that same trend or maybe we heard that incorrectly. Austin Willis: Well, I'd say not really, but I will say this. Look, there's long term and short term in terms of the duration that the assets on lease and then there's long term and short term in terms of the redelivery conditions and how that's structured. We are seeing more of our leases going out on long-term conditions, but that's largely a byproduct of us just modernizing our portfolio. Operator: And it appears there are no further questions at this time. Mr. Austin, I will turn the call back to you for any closing or additional remarks. Austin Willis: Thank you, operator. Before we conclude today, I wanted to highlight that we will attend Deutsche Bank's 16th Annual Aviation Forum, which will be held in New York the second week of September falling Labor Day. We hope to see many of you there. We appreciate everybody giving us their time today, and we'll speak to you again in the fall. Bye-bye. Operator: This concludes today's call. Thank you for your participation. You may now disconnect. Before you buy stock in Willis Lease Finance, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Willis Lease Finance wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. 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As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Willis Lease Finance (WLFC) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Shares of Willis Lease Finance Corporation WLFC have declined 16% since the company reported its earnings for the quarter ended June 30, 2026. This compares to the S&P 500 index’s 1.5% growth over the same time frame. Over the past month, the stock has declined 15.3% against the S&P 500’s 2.8% growth. WLFC reported second-quarter earnings per share of $1.31, which declined 53.4% from $2.81 recorded in the prior-year quarter. Revenues of $194 million indicated a 0.8% decline from $195.5 million a year earlier. Net income attributable to common shareholders fell 51.2% to $28.7 million from $59 million. However, the year-ago results included a $43 million gain from the sale of the BAML business. On a normalized basis, excluding that gain, the company said net income increased 80% and EPS rose 72%. Income from operations advanced 20.2% to $34 million, while adjusted EBITDA increased 4% to $120.7 million. Willis Lease Finance Corporation price-consensus-eps-surprise-chart | Willis Lease Finance Corporation Quote Lease rent revenues increased 6.7% to $77.1 million, reflecting a larger average portfolio, while the monthly on-lease lease rate factor improved three basis points to 1.03%. Blended utilization was 85%, down from 87.2% a year earlier. Maintenance reserve revenue declined 8.4% to $46.5 million, with short-term maintenance reserve revenue falling 22% to $39 million. That weakness was partly offset by long-term maintenance reserve revenue of $7.5 million versus $0.5 million a year ago. Management and advisory fees more than doubled to $5.5 million from $2.6 million, while maintenance services revenues increased 11.9% to $9 million. Gain on sale of leased equipment rose 16.2% to $32 million. Assets under management reached $4.4 billion, up 21% year over year, while net debt-to-equity stood at 2.78 times. The decline in short-term maintenance reserve revenue reflected fewer engines operating under short-term lease conditions and lower flight activity on less fuel-efficient aircraft amid elevated fuel prices. Management said newer LEAP and GTF engines generally maintained stronger utilization. Meanwhile, the $32 million gain on leased-equipment sales reflected sales of 21 engines and other equipment, including assets used to seed the Blackstone fund. Expenses provided a mixed picture. Total expenses decreased 4.3% to $160 million, helped by lower spare-parts costs and equipment write-downs. However, general and administrative expenses increased 10.2% to $55.6 million and technical expenses rose 32.5% to $9.9 million. Net finance costs increased 4.6% to $35.1 million, including a $5.4 million loss on debt extinguishment. WLFC ended the second quarter with total assets of $3.7 billion, down from $3.9 billion at Dec. 31, 2025. Cash and cash equivalents declined to $10.7 million from $16.4 million. Debt obligations decreased to $2.3 billion from $2.7 billion at the end of 2025. Total equity increased to $710.3 million from $662.1 million. CEO Austin Willis emphasized the expansion of the asset-management platform, with Willis Aviation Capital helping shift WLFC toward a broader capital-light model. Management said fund seeding is now largely complete and expects further fund growth to come primarily through third-party purchases. The company highlighted roughly $1.3 billion of additional capital available for deployment and described its acquisition pipeline as significant. Its presentation also cited a visible pipeline supporting near-term earnings growth and structural aviation supply constraints supporting lease demand and yields. CFO Scott Flaherty specifically declined to get ahead of the company on guidance. WLFC nevertheless indicated that it intends to deploy existing fund capital before pursuing additional, potentially larger institutional funds. During June, WLFC acquired entities owning three Airbus A330-300 aircraft intended for long-term leases with China Airlines and EVA Air. The company also completed $300 million of seed-asset sales and issued $200 million of five-year, 2.5% convertible senior notes. After quarter-end, WLFC signed an approximately $379.3 million agreement to acquire 12 aircraft and 13 aircraft engines and entered a five-year storage and lease agreement with Pratt & Whitney. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Willis Lease Finance Corporation (WLFC) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Interested in Willis Lease Finance Corporation? Here are five stocks we like better. Willis Lease Finance reported solid Q2 2026 results with $194 million in revenue, $38.1 million in earnings before tax, $120.7 million in adjusted EBITDA and $1.31 in diluted EPS. Earnings before tax declined year over year because the prior period included a $43 million one-time gain. Assets under management grew 21% to approximately $4.4 billion, led by an almost 80% increase in the Willis Aviation Capital platform to $1.4 billion. The company also has about $1.3 billion available for deployment and agreed to acquire a portfolio containing 12 aircraft and 13 engines for $379 million. Lease-rent revenue rose 6.7% despite utilization easing to 85%, while equipment-sale gains increased to $32 million. Willis also expanded maintenance services, issued $200 million of convertible notes, and declared its ninth consecutive quarterly dividend following a three-for-one stock split. Willis Lease Finance (NASDAQ:WLFC) reported second-quarter 2026 revenue of $194 million, earnings before tax of $38.1 million and adjusted EBITDA of $120.7 million, as the aircraft-engine leasing company expanded assets under management and continued building its asset-management platform. Net income attributable to common shareholders was $28.7 million, or $1.31 per diluted share. Earnings before tax declined from $74.3 million a year earlier, when results included a $43 million one-time gain from the sale of the company’s WAML fleet-management business to its Willis Mitsui joint venture. → SpaceX’s First Earnings Report Could Decide Whether Shorts or Bulls Have Control “We are pleased to have continued strong momentum from earlier in the year and are reporting another quarter of solid financial and operational performance,” Chief Executive Officer Austin Willis said. Total assets under management increased 21% year over year to about $4.4 billion in the second quarter, from roughly $3.6 billion in the same period of 2025. Assets on Willis Lease Finance’s balance sheet represented 67% of total assets under management. → Financials Hit Record Highs as the AI Trade Unravels—Can They Keep Leading? The company’s Willis Aviation Capital, or WAC, asset-management business grew to $1.4 billion of assets under management, an increase of nearly 80% from a year earlier. Willis said it has largely completed the process of seeding portfolios into its Blackstone and Liberty Mutual funds, as well as its Mitsui joint venture, and expects future fund growth to come primarily through third-party market purchases. Willis said it has approximately $1.3 billion of additional capital available to deploy through its discretionary funds, excluding capital raised through joint ventures and its own corporate capital structure. Net debt-to-equity leverage, including preferred stock, stood at 2.78 times at the end of the quarter. → Why Rare Earth Processing Could Be the Real 2027 Opportunity During June, the company acquired the entities owning three Airbus A330-300 aircraft leased to China Airlines and EVA Air. In July, it signed definitive documentation to acquire private-equity entities that own 12 additional commercial aircraft and 13 aircraft engines. The July portfolio transaction was valued at $379 million, according to CFO Scott Flaherty. Lease-rent revenue increased 6.7% year over year to $77.1 million. Average lease-portfolio utilization was 85%, compared with 87.2% in the year-earlier period, while the average lease rate increased to 1.03% from 1.0%. Willis said its portfolio continues to shift toward newer-generation engines. Modern-technology engines, including LEAP, GTF and GEnx models, accounted for about 60% of the consolidated portfolio’s net book value, including the company’s balance sheet and WAC assets. Management said demand for these engine types should remain strong as Airbus A320neo and Boeing 737 MAX aircraft production rises and the engines mature. Willis expects more frequent off-wing maintenance as scheduled removals for performance restoration and life-limited-parts replacement accelerate. The company also expects older CFM56 and V2500 engines to remain important contributors, though it said it is being selective about asset purchases as those platforms mature. Austin Willis said the company’s ConstantThrust offering and its maintenance approach, which emphasizes “hospital shop visits” rather than full overhauls, could help customers transition to newer technology. Maintenance-reserve revenue fell to $46.5 million from $50.7 million a year earlier. Short-term maintenance reserves declined to $39 million from $50.2 million, partly because the number of engines on short-term lease conditions fell 4.9% as the portfolio shifted toward newer engines generally leased on longer terms. Flaherty said certain operators reduced flight hours and cycles during April and May amid higher fuel prices. However, the company saw a recovery in aircraft operating tempo and related reserve revenue toward the end of the quarter as a ceasefire took hold in Iran and fuel prices declined. Long-term maintenance-reserve revenue increased to $7.5 million from $0.5 million in the prior-year quarter, including $6.8 million associated with one V2500 engine coming off a long-term lease. Gain on sale of leased equipment totaled $32 million, up from $27.6 million a year earlier. The gain was tied to sales of 21 engines and other parts and equipment for $224.8 million before economic closing adjustments. Fourteen of the engines were sold as part of a seed portfolio for the Blackstone fund. In response to an analyst question, Flaherty said the $32 million gain represented a 14.2% margin and that the company’s annual appraisal process indicates its overall portfolio is valued at about 20% above book value. He cautioned that realized results can vary by individual asset. Maintenance-services revenue rose 11.9% to $9 million, driven by growth in engine and aircraft storage. The segment reported a negative gross margin of $1.4 million, which Flaherty attributed to the seasonality of base-maintenance activity. Willis recently signed a major engine-storage agreement with Pratt & Whitney following nearly a year of inspections and quality audits, Austin Willis said. The company is also in advanced discussions to establish another engine-repair center in Asia. In May, Willis issued $200 million of 2.5% convertible senior notes due 2031 and used proceeds to reduce borrowings on its $1.75 billion revolving credit facility. The notes have a split-adjusted conversion price of $89.60 per share, representing a 40% premium at issuance, Flaherty said. The company completed a three-for-one stock split effective July 21. Its board also declared a quarterly dividend of $0.133 per share on a split-adjusted basis, payable Aug. 21 to shareholders of record Aug. 11. The payment marks the company’s ninth consecutive recurring quarterly dividend. Willis Lease Finance Corporation (NASDAQ: WLFC) is an independent global provider of aircraft engine leasing, trading and aftermarket services. Founded in 1991 and headquartered in the United States, the company specializes in offering short- and long-term operating leases for jet engines and auxiliary power units. Through its broad engine portfolio, Willis Lease Finance supports a wide range of commercial aircraft across various operators, including major airlines, regional carriers and other leasing companies. In addition to leasing solutions, Willis Lease Finance offers comprehensive engine trading and asset management services. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Willis Lease Finance Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Performance was driven by a 21% year-over-year increase in assets under management to $4.4 billion, supported by the successful seeding of new discretionary funds. Management attributed a reduction in short-term maintenance reserve revenue to customers flying fewer hours on older, less fuel-efficient platforms like the A320ceo and 737NG during periods of elevated fuel pricing. Modern engine platforms (LEAP, GTF, GEnx) now comprise 60% of the consolidated portfolio by net book value, reflecting a multi-year strategic shift toward fuel-efficient technology. The company is pivoting its acquisition strategy toward M&A and special purpose vehicle (SPV) transactions to avoid lengthy novation processes preferred by current sellers. Strategic positioning focuses on 'hospital shop visits' as a cost-effective alternative to full overhauls for maturing engine types, providing a competitive edge as maintenance demand accelerates. Geopolitical disruptions in Iran caused temporary market volatility and impacted transaction volumes, though underlying demand for core assets remained resilient. Management expects a return to balanced growth between the balance sheet and Willis Aviation Capital now that initial fund seeding is largely complete. The company anticipates robust demand for LEAP and GTF engines as these platforms reach maturity, leading to more frequent scheduled maintenance and off-wing requirements. Future growth in discretionary funds is expected to come from third-party market purchases rather than internal asset transfers, utilizing $1.3 billion in available dry powder. Strategic expansion of the 'Services' segment includes advanced discussions to establish a new engine repair center in Asia to replicate the successful WERC model. Management projects a continued decline in share-based compensation expenses through 2028 due to structural changes in employee equity award programs. The company recognized a $5.4 million loss on debt extinguishment related to capital restructuring and the issuance of $200 million in convertible senior notes. A 3-for-1 stock split was implemented in July 2026 to enhance equity liquidity and broaden investor participation in Russell 2000 indices. The effective tax rate of 20.5% was positively impacted by a worthless stock deduction from a discontinued sustainable aviation fuel project. A major engine storage agreement was signed with Pratt & Whitney, validating the company's vertically integrated service platform as a key differentiator. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management confirmed that the overall portfolio book value is approximately 20% below appraised industry values, indicating significant embedded gains. Recent equipment sales achieved gross margins of 49%, though management cautioned that gains are granular and depend on specific asset book values at the time of sale. Austin Willis noted strong inbound interest from institutional investors and stated the current funds are not 'one-off' sidecars but part of a long-term strategy. The company intends to raise larger subsequent funds once the current $1.3 billion in discretionary capital is fully deployed. The mix between long-term and short-term leases remains stable at approximately 50-50, despite broader industry rumors of a shift toward shorter durations. Management noted a trend toward more 'long-term conditions' in new leases, which is primarily a byproduct of the fleet's modernization rather than macro-driven demand changes.

This article first appeared on GuruFocus. Revenue: $194 million in Q2 2026. Earnings Before Tax (EBT): $38.1 million. Net Income: $28.7 million attributable to common shareholders. Diluted EPS: $1.31 per share. Adjusted EBITDA: $120.7 million, up 4% from $116.1 million in Q2 2025. Lease Rent Revenue: $77.1 million, up 6.7% year-over-year. Maintenance Reserve Revenue: $46.5 million, down from $50.7 million in the prior-year quarter. Spare Parts and Equipment Sales: $21.2 million, compared to $30.4 million in Q2 2025. Gains on Sale of Lease Equipment: $32 million, up from $27.6 million in the prior-year period. Maintenance Services Revenue: $9 million, up 11.9% year-over-year. Management and Advisory Fees: $5.5 million, up 113% year-over-year. Assets Under Management (AUM): $4.4 billion, up 21% from $3.6 billion in Q2 2025. Average Lease Portfolio Utilization: 85% in Q2 2026, down from 87.2% in Q2 2025. Average Lease Rate: Increased to 1.03% from 1.0% year-over-year. Leverage: 2.78 times at the end of Q2 2026. Warning! GuruFocus has detected 8 Warning Signs with WLFC. Is WLFC fairly valued? Test your thesis with our free DCF calculator. Release Date: August 04, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Willis Lease Finance Corp (NASDAQ:WLFC) reported strong Q2 2026 results with EBT of $38 million and adjusted EBITDA of $120.7 million, up 4% year-over-year. Assets under management grew 21% year-over-year to $4.4 billion, driven by expansion in Willis Aviation Capital (WAC), which saw an 80% increase in AUM. The company successfully executed two M&A transactions to acquire aircraft and engines through special purpose vehicles, expanding its portfolio and customer base. WLFC secured a major engine storage agreement with Pratt & Whitney, highlighting its growing reputation as a trusted service provider and creating new revenue opportunities. The company issued $200 million in convertible notes at a 40% premium, reducing leverage and lowering financing costs, while maintaining a low leverage ratio of 2.78 times. Management and advisory fees surged 113% to $5.5 million, driven by fees from the Blackstone and Liberty Mutual funds, reflecting successful asset management growth. The company has $1.3 billion in additional capital ready to deploy, providing significant flexibility for future growth and investment opportunities. Short-term maintenance reserve revenues declined to $39 million from $50.2 million in the prior year, due to reduced flight hours on older, less fuel-efficient engines and geopolitical disruptions. The geopolitical environment, including the conflict in Iran, caused temporary market disruptions and reduced the volume of aircraft and engine transactions. General and administrative expenses increased by $5.1 million to $55.6 million, driven by higher legal fees and the absence of prior-year government grant receipts. The company recognized a $5.4 million loss on debt extinguishment in Q2 2026, related to refinancing activities, which negatively impacted net finance costs. Average portfolio utilization declined to 85% from 87.2% in the prior year, reflecting fluctuations due to maintenance, asset movements, and new acquisitions. Spare parts and equipment sales decreased to $21.2 million from $30.4 million in the prior year, with equipment sales down significantly, though margins remained strong. Technical expenses increased by $2.4 million to $9.9 million due to higher engine repair activity, which could pressure margins if sustained. Q: Can you talk about the assets you've put in the SPV and the mark on them, and how it highlights the undervaluation of the current marks on your balance sheet?A: Austin Willis (CEO) explained that the composition of the portfolio broadly echoes the company's broader portfolio, noting it was the point of the Blackstone Fund. Scott Flaherty (CFO) added that the company sold about $224 million of assets and recognized a $32 million gain (14.2% margin). He noted that on an annual basis, the overall portfolio is coming in at about 20% below its appraised value, implying an embedded 20% gain if the entire portfolio were sold at market values. Q: Can you talk about the capacity you see for the asset management business, how that might grow in the future, and the type of institutional demand you're seeing for those products?A: Austin Willis (CEO) confirmed they are seeing a lot of demand for the product and have received numerous inbound inquiries from institutional investors looking to replicate the model. He emphasized that the two discretionary funds are not a one-off sidecar but a genuine long-term asset management strategy. The intention is to deploy the capital in the current funds and then raise additional, larger funds in the future, relying on the platform to deliver premium returns. Q: Historically, the long-term versus short-term lease mix was around 50%. Has there been a shift to shorter-term leases given the uncertainty in the aviation market with higher fuel prices?A: Austin Willis (CEO) stated the mix is still around 50/50. While the term of leases is slightly shorter than last year, he did not attribute this to any particular factor. He clarified that while they are seeing more leases going out on long-term conditions, this is largely a byproduct of modernizing the portfolio, not a shift in market demand for shorter terms. Q: When analysts do pick up coverage, do you think you'll guide to earnings without gains, similar to AirCap, or will it be with gains, or some combination?A: Scott Flaherty (CFO) declined to get ahead of the company on guidance, simply acknowledging the point. The response suggests the company is not yet ready to commit to a specific earnings guidance framework. Q: Can you provide more detail on the $379 million leased aircraft and engine portfolio transaction announced as a Q2 subsequent event in July?A: Austin Willis (CEO) noted that in July, the company signed definitive documentation to acquire the private equity entities that own an additional 12 commercial aircraft and 13 aircraft engines. These acquisitions provide an opportunity to expand the portfolio and customer base, with plans to use the platform and programs to extract additional value from these assets. Q: What is the status of the engine storage agreement with Pratt & Whitney, and what does it mean for the services business?A: Austin Willis (CEO) announced that after nearly a year of on-site inspections and quality audits, the company signed a major engine storage agreement with Pratt & Whitney. This is indicative of the confidence placed in the company as both a customer and service provider. The company intends to be good custodians of their assets at maintenance facilities in the US and UK, and is in advanced discussions to establish another center in Asia. Q: Can you elaborate on the impact of the geopolitical environment, specifically the conflict in Iran, on the business?A: Austin Willis (CEO) explained that while the war in Iran hasn't affected demand for assets, it has had some effect on the volume of aircraft and engine transactions. The company saw a reduction in short-term maintenance reserve revenue as customers flew fewer hours on less fuel-efficient platforms like the A320CEO and 737NGs. However, more modern engines like LEAP and GTF saw increased flight utilization due to their fuel efficiency, and maintenance reserve revenues from older engine types are improving along with trade volume. Q: What is the current leverage position and how does it provide flexibility for growth?A: Scott Flaherty (CFO) reported that leverage, defined as total debt obligations net of cash and restricted cash to equity inclusive of preferred stock, was 2.78 times at the end of Q2 2026. He noted the company has made significant strides over the last seven years to reduce leverage, positioning Willis to access market opportunities when they become available, such as the $379 million leased aircraft and engine portfolio transaction announced in July. Q: Can you discuss the decline in short-term maintenance reserve revenue and the outlook for recovery?A: Scott Flaherty (CFO) explained that short-term maintenance reserve revenues were $39 million in Q2 2026, down from $50.2 million in Q2 2025. The average number of engines on short-term conditions declined by 4.9% as the portfolio mix shifted towards new tech engines, which tend to have longer-term leases. There was also a reduction in hours and cycles in April and May due to elevated fuel pricing. However, at the tail end of Q2, the company started to see a recovery in operating tempo as a ceasefire took hold in Iran and fuel prices began to decline. Q: What is the outlook for the LEAP and GTF engines, and how is the company positioned?A: Austin Willis (CEO) stated that while both aircraft platforms have had entry-into-service difficulties driven by engine-related technical issues, the engines are now reaching a point of maturity where scheduled removals for performance restoration and LLP replacement are beginning to accelerate. The company expects LEAP and GTF engines to require more frequent off-wing maintenance, leading to strong demand. About 60% of the consolidated portfolio by net book value consists of modern tech engines, including LEAP, GTF, and GENX, positioning the company well to serve this growing base into the next decade. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

COCONUT CREEK, Fla., Aug. 04, 2026 (GLOBE NEWSWIRE) -- Willis Lease Finance Corporation (NASDAQ: WLFC) (“WLFC” or the “Company”), the leading lessor of commercial aircraft engines and global provider of aviation services, today announced its financial results for the second quarter ended June 30, 2026. Second Quarter 2026 Highlights (All metrics compared to second quarter 2025, except where noted) Income from operations of $34.0 million, an increase of 20.2% Quarterly lease rent revenue of $77.1 million, an increase of 6.7% Quarterly core lease rent and maintenance reserve revenues were $123.6 million in the aggregate, up 0.5% Gain on sale of leased equipment of $32.0 million, an increase of 16.2% Net income attributable to common shareholders of $28.7 million Adjusted EBITDA of $120.7 million, an increase of 4.0% Grew assets under management, including on our balance sheet and Willis Aviation Capital businesses, to $4.4 billion “The first half of the year was focused on establishing and building Willis Aviation Capital,” said Austin C. Willis, Chief Executive Officer of WLFC, “with total AUM growth of 21% year over year, we have delivered.” Second Quarter 2026 Operating Results Lease rent revenue increased by $4.9 million, or 6.7%, to $77.1 million in the three months ended June 30, 2026 from $72.3 million for the three months ended June 30, 2025. The increase is due to an increase in the average size of the portfolio as compared to that of the prior year period. During the second quarter of 2026, the Company recognized $7.5 million of long-term maintenance revenue, compared to $0.5 million for the quarter ended June 30, 2025. Long-term maintenance is recognized at the end of a lease period as the related maintenance reserve liability is released from the balance sheet. For the quarter ended June 30, 2026, the gain on sale of leased equipment was $32.0 million, reflecting the sale of 21 engines and other parts and equipment from the lease portfolio. During the three months ended June 30, 2025, the Company sold 14 engines, two airframes, and other parts and equipment for a net gain of $27.6 million. In March 2026, the Company’s investment fund partnership with Liberty Mutual Investments commenced operations, followed by the commencement of the Company’s investment fund partnership with Blackstone Credit & Insurance in April 2026. The book value of lease assets owned either directly or through WLFC’s joint ventures, inclusive of the Company’s equipment held for operating lease, maintenance rights, notes receivable, and investments in sales-type leases was $3,721.6 million as of June 30, 2026. The value of our assets under management, inclusive of the book value of WLFC’s on-balance sheet assets as well as leased assets in our joint ventures, third-party managed assets, and managed fund portfolios was $4.4 billion as of June 30, 2026. NON-GAAP FINANCIAL MEASURES Adjusted EBITDA We analyze our financial data to evaluate the health of our business and assess our performance. As appropriate, in addition to income or loss from operations under GAAP, we use Adjusted EBITDA, a non-GAAP financial measure, to evaluate our business. We believe that this non-GAAP financial measure provides meaningful supplemental information regarding our performance as it excludes certain items that may not be indicative of our recurring operating results. We also believe that investors, in addition to management, benefit from referring to this non-GAAP financial measure in assessing our performance, when viewed together with our GAAP results. While items excluded from Adjusted EBITDA may be recurring in nature and should not be disregarded in evaluating performance, it can be useful to exclude such items as they can vary significantly between periods and or not be indicative of current or future operating results. Because non-GAAP financial measures are not standardized, our calculation of Adjusted EBITDA may differ from similarly titled non-GAAP measures, if any, reported by other companies. This non-GAAP financial measure should not be considered in insolation from, or as a substitute for, financial information performed in accordance with GAAP. We define Adjusted EBITDA as net income attributable to common shareholders, excluding (i) income tax expense, (ii) interest expense, (iii) preferred stock dividends/costs, (iv) loss on debt extinguishment, (v) depreciation and amortization expense, (vi) stock compensation expense, (vii) write-down of equipment, (viii) acquisition, financing and divestitures related expenses, and (ix) other items not indicative of our ongoing operating performance. Adjusted EBITDA was approximately $120.7 million and $116.1 million for the three months ended June 30, 2026 and 2025, respectively, and $244.6 million and $219.4 million for the six months ended June 30, 2026 and 2025, respectively. See below for the reconciliation of Adjusted EBITDA to the most directly comparable GAAP measure, net income attributable to common shareholders. ________________________________________________________ During the three and six months ended June 30, 2026, the Company recognized non-recurring project expenses of $(1.6) million and $(1.6) million, respectively, related to its sustainable aviation fuel project. The negative expense recognized during the three-month and six-month periods reflect government grant proceeds recognized in the second quarter of 2026. During the three and six months ended June 30, 2025, the Company recognized non-recurring project expenses of $(5.3) million and $6.5 million, respectively, related to its sustainable aviation fuel project, for which the Company subsequently decided to cease further investment. The negative expense recognized during the three-month period reflects government grant proceeds received in the second quarter of 2025. Additionally, during the three and six months ended June 30, 2025, the Company recognized $43.0 million in relation to the gain on sale of the BAML business. Balance Sheet As of June 30, 2026, the Company’s lease portfolio was $2,956.3 million, consisting of $2,783.4 million of equipment held in its operating lease portfolio, $89.3 million of notes receivable, and $83.6 million of maintenance rights, which represented 334 engines, 22 aircraft, one marine vessel, and other leased parts and equipment. As of December 31, 2025, the Company’s lease portfolio was $2,988.9 million, consisting of $2,801.7 million of equipment held in its operating lease portfolio, $139.9 million of notes receivable, $30.6 million of maintenance rights, and $16.6 million of investments in sales-type leases, which represented 363 engines, 20 aircraft, one marine vessel, and other leased parts and equipment. Conference Call WLFC will hold a conference call led by the executive management team today at 10:00 a.m. Eastern Time to discuss its second quarter 2026 results. To participate in the conference call, please use the following dial-in numbers: U.S. and Canada: +1 (800) 330-6730 International: +1 786 297 8585Conference ID: 7661930Participant Passcode: 442978 The conference call may also be accessed by registering via the following link: https://event.webcasts.com/starthere.jsp?ei=1759374&tp_key=c0ab3b632b. A digital replay will be available two hours after the completion of the conference call. To access the replay, please visit the Investor Relations sections of our website at https://www.wlfc.global/investor-center. About Willis Lease Finance Corporation Willis Lease Finance Corporation (WLFC) leases large and regional spare commercial aircraft engines and aircraft to airlines, aircraft engine manufacturers and maintenance, repair and overhaul providers worldwide. These leasing activities are integrated with engine and aircraft trading, engine lease pools and asset management services, as well as various end-of-life solutions for engines and aviation materials provided through Willis Aeronautical Services, Inc. Additionally, through Willis Engine Repair Center®, Jet Centre by Willis, and Willis Aviation Services Limited, the Company’s service offerings include Part 145 engine maintenance, aircraft line and base maintenance, aircraft disassembly, parking and storage, airport FBO, and ground and cargo handling services. Forward-Looking Statements Except for historical information, the matters discussed in this press release contain forward-looking statements that involve risks and uncertainties. Do not unduly rely on forward-looking statements, which give only expectations about the future and are not guarantees. By their nature, forward-looking statements involve a number of inherent risks, uncertainties and assumptions and are subject to change in circumstances that are difficult to predict and many of which are outside of our control. These risks, uncertainties and assumptions could adversely affect the outcome and financial effects of the plans and events described herein. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update them to reflect any change in the Company’s expectations or any change in events, conditions or circumstances on which the forward-looking statement is based, except as required by law. Our actual results may differ materially from the results discussed, either expressly or implicitly, in forward-looking statements. Factors that might cause such a difference include, but are not limited to: the effects on the airline industry and the global economy of events such as war, terrorist activity and natural disasters; changes in oil prices, rising inflation and other disruptions to world markets; trends in the airline industry and our ability to capitalize on those trends, including growth rates of markets and other economic factors, as well as the impact of new or increased tariffs; risks associated with owning and leasing jet engines and aircraft; our ability to successfully negotiate equipment purchases, sales and leases, to collect outstanding amounts due and to control costs and expenses; changes in interest rates and availability of capital, both to us and our customers; our ability to continue to meet changing customer demands; regulatory changes affecting airline operations, aircraft maintenance, accounting standards and taxes; the market value of engines and other assets in our portfolio; and risks detailed in the Company’s Annual Report on Form 10-K and other continuing and current reports filed with the Securities and Exchange Commission. It is advisable, however, to consult any further disclosures the Company makes on related subjects in such filings. These statements constitute the Company’s cautionary statements under the Private Securities Litigation Reform Act of 1995. Unaudited Condensed Consolidated Statements of Income(In thousands, except per share data) Unaudited Condensed Consolidated Balance Sheets(In thousands, except per share data)

COCONUT CREEK, Fla., July 30, 2026 (GLOBE NEWSWIRE) -- Willis Lease Finance Corporation (NASDAQ: WLFC) (“WLFC” or the “Company”), announced today the Company’s quarterly dividend of $0.133 per share of common stock outstanding, adjusted due to the Company’s 3-for-1 stock split earlier in the month. The dividend is expected to be paid on August 21, 2026, to stockholders of record at the close of business on August 11, 2026. About Willis Lease Finance Corporation Willis Lease Finance Corporation leases large and regional spare commercial aircraft engines and aircraft to airlines, aircraft engine manufacturers and maintenance, repair, and overhaul providers worldwide. These leasing activities are integrated with engine and aircraft trading, engine lease pools, and asset management services through Willis Mitsui & Co. Asset Management Limited, as well as various end-of-life solutions for engines and aviation materials provided through Willis Aeronautical Services, Inc. Through Willis Engine Repair Center®, Jet Centre by Willis, and Willis Aviation Services Limited, the Company’s service offerings include Part 145 engine maintenance, aircraft line and base maintenance, aircraft disassembly, parking and storage, airport FBO and ground and cargo handling services. Except for historical information, the matters discussed in this press release contain forward-looking statements that involve risks and uncertainties. Do not unduly rely on forward-looking statements, which give only expectations about the future and are not guarantees. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update them to reflect any change in the Company’s expectations or any change in events, conditions, or circumstances on which the forward-looking statement is based, except as required by law. The Company’s actual results may differ materially from the results discussed in forward-looking statements. Factors that might cause such a difference include, but are not limited to: the effects on the airline industry and the global economy of events such as war, terrorist activity and the COVID-19 pandemic; changes in oil prices, rising inflation and other disruptions to world markets; trends in the airline industry and the Company’s ability to capitalize on those trends, including growth rates of markets and other economic factors; risks associated with owning and leasing jet engines and aircraft; the Company’s ability to successfully negotiate equipment purchases, sales and leases, to collect outstanding amounts due and to control costs and expenses; changes in interest rates and availability of capital, both to the Company and its customers; the Company’s ability to continue to meet changing customer demands; regulatory changes affecting airline operations, aircraft maintenance, accounting standards and taxes; the market value of engines and other assets in the Company’s portfolio; and risks detailed in the Company’s Annual Report on Form 10-K and other continuing and current reports filed with the Securities and Exchange Commission. It is advisable, however, to consult any further disclosures the Company makes on related subjects in such filings. These statements constitute the Company’s cautionary statements under the Private Securities Litigation Reform Act of 1995.

COCONUT CREEK, Fla., July 21, 2026 (GLOBE NEWSWIRE) -- Willis Lease Finance Corporation (NASDAQ: WLFC) (the “Company”), the leading lessor of commercial aircraft engines and global provider of aviation services, today announced it will release its financial results for the second quarter of 2026 before the market opens on August 4, 2026. The Company will host a conference call led by the executive management team that day at 10:00 a.m. Eastern Time. To participate in the conference call, please use the following dial-in numbers: U.S. and Canada: +1 (800) 330-6730International: +1 786 297 8585Conference ID: 7661930Participant Passcode: 442978 The conference call may also be accessed by registering via the following link: https://event.webcasts.com/starthere.jsp?ei=1768040&tp_key=c567b99f23. A digital replay will be available two hours after the completion of the conference call. To access the replay, please visit the Company’s website at www.wlfc.global under the Investor Center section for details. Willis Lease Finance Corporation Willis Lease Finance Corporation leases large and regional spare commercial aircraft engines and aircraft to airlines, aircraft engine manufacturers and maintenance, repair, and overhaul providers worldwide. These leasing activities are integrated with engine and aircraft trading, engine lease pools, and asset management services through Willis Mitsui & Co. Asset Management Limited, as well as various end-of-life solutions for engines and aviation materials provided through Willis Aeronautical Services, Inc. Through Willis Engine Repair Center®, Jet Centre by Willis, and Willis Aviation Services Limited, the Company’s service offerings include Part 145 engine maintenance, aircraft line and base maintenance, aircraft disassembly, parking and storage, airport FBO and ground and cargo handling services. Except for historical information, the matters discussed in this press release contain forward-looking statements that involve risks and uncertainties. Do not unduly rely on forward-looking statements, which give only expectations about the future and are not guarantees. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update them to reflect any change in the Company’s expectations or any change in events, conditions, or circumstances on which the forward-looking statement is based, except as required by law. The Company’s actual results may differ materially from the results discussed in forward-looking statements. Factors that might cause such a difference include, but are not limited to: the effects on the airline industry and the global economy of events such as war, terrorist activity and the COVID-19 pandemic; changes in oil prices, rising inflation and other disruptions to world markets; trends in the airline industry and the Company’s ability to capitalize on those trends, including growth rates of markets and other economic factors; risks associated with owning and leasing jet engines and aircraft; the Company’s ability to successfully negotiate equipment purchases, sales and leases, to collect outstanding amounts due and to control costs and expenses; changes in interest rates and availability of capital, both to the Company and its customers; the Company’s ability to continue to meet changing customer demands; regulatory changes affecting airline operations, aircraft maintenance, accounting standards and taxes; the market value of engines and other assets in the Company’s portfolio; and risks detailed in the Company’s Annual Report on Form 10-K and other continuing and current reports filed with the Securities and Exchange Commission. It is advisable, however, to consult any further disclosures the Company makes on related subjects in such filings. These statements constitute the Company’s cautionary statements under the Private Securities Litigation Reform Act of 1995.

Shares of Willis Lease Finance Corporation WLFC have gained 13.7% since the company reported its earnings for the quarter ended March 31, 2026, outperforming the S&P 500 index’s 2.9% increase over the same period. However, over the past month, the stock rose 7.4%, trailing the S&P 500’s 8.6% growth. WLFC delivered first-quarter 2026 earnings per share of $3.26, which rose 47.5% from $2.21 in the year-ago quarter. Total revenues increased 23.2% year over year to $194.3 million, while net income attributable to common shareholders climbed 52.9% to $23.7 million. Income from operations improved 41.4% to $33.8 million, and pretax income increased 45.9% to $36.8 million. The quarterly results were driven by higher lease rent revenues, gains on equipment sales and expanding aviation services activity. Willis Lease Finance Corporation price-consensus-eps-surprise-chart | Willis Lease Finance Corporation Quote WLFC reported record quarterly lease rent revenues of $77.4 million, up 14.2% from the prior-year quarter, reflecting a larger average portfolio size and improved utilization levels. Portfolio utilization increased to 85.8% at quarter-end from 79.9% a year earlier. Management noted that strong aviation market conditions, constrained engine availability and airlines’ efforts to avoid costly engine shop visits continued to support leasing demand. Maintenance reserve revenues edged up 1.2% to $55.5 million, including $12.4 million of long-term maintenance revenues recognized at lease termination compared with $9.6 million in the prior-year quarter. Spare parts and equipment sales rose 18.9% to $21.7 million, while maintenance services revenues surged 74.9% to $9.8 million. Management and advisory fees jumped more than 300% to $7.9 million, aided by fees related to the Liberty Mutual fund partnership. The company also benefited from strong asset sale activity. Gain on sale of leased equipment rose 304.8% year over year to $18 million, supported by the sale of 14 engines during the quarter versus seven engines, one airframe and other equipment sold a year ago. Chief executive officer Austin Willis said the company “outperformed nearly every revenue and earnings metric compared to Q1 2025” and highlighted favorable industry conditions, including limited spare engine availability and elevated maintenance demand. Management emphasized that airlines continue to preserve liquidity by leasing engines instead of purchasing them outright. The company also cited prolonged engine maintenance timelines and pressure on spare engine supply as key drivers supporting lease rates and utilization. Management added that newer-generation engines, including LEAP, GTF and GEnx models, now account for roughly half of WLFC’s engine portfolio, positioning the company to benefit from sustained demand trends. Executives also pointed to growth opportunities from Willis Aviation Capital, the company’s expanding asset-management platform. Management said Blackstone now manages more than $2.7 billion of committed or deployed capital across WLFC joint ventures and partnerships, while Liberty Mutual’s investment partnership commenced operations during the quarter. Adjusted EBITDA increased 19.9% year over year to $123.8 million, reflecting stronger operating performance and higher revenue across multiple business lines. General and administrative expenses rose 18.6% to $56.6 million, partly due to higher personnel and share-based compensation costs. Technical expenses climbed 55.5% to $9.7 million as the company expanded maintenance-related activities to support growing customer demand. Net finance costs increased 23.6% to $39.7 million, including a $7 million loss on debt extinguishment tied to refinancing activity. WLFC continued to strengthen its balance sheet and liquidity profile during the quarter. Management said the company expanded its revolving credit facility commitments from $1 billion to $1.75 billion and extended the maturity to April 2031. The company also completed additional Japanese operating leases with call option financings totaling roughly $50 million. The company ended the quarter with total assets of $3.5 billion and debt obligations of $2.3 billion, down from $2.7 billion at the end of 2025. Net debt-to-equity improved to 2.68 times. WLFC declared a quarterly dividend of 40 cents per share, payable on May 22, 2026, to shareholders of record as of May 11, 2026. Management reiterated confidence in the company’s growth strategy, citing strong demand fundamentals, a visible investment pipeline and increasing scale within its asset-management platform. In March 2026, WLFC’s investment fund partnership with Liberty Mutual Investments officially commenced operations. During the quarter, the company funded approximately $90 million of finance leases through the Liberty Mutual fund. Management also discussed progress with its Blackstone partnership, noting plans to continue deploying additional assets into Blackstone-managed portfolios during 2026. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Willis Lease Finance Corporation (WLFC) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Image source: The Motley Fool. Tuesday, May 5, 2026, at 10 a.m. ET Chief Executive Officer — Austin Willis Chief Financial Officer — Scott Flaherty Need a quote from a Motley Fool analyst? Email [email protected] Austin Willis: Thank you, operator, and thank you all for joining us today to discuss Willis Lease Finance Corporation's First Quarter 2026 Financial Results. On our call today, I'm joined by Scott Flaherty, our Chief Financial Officer. We have posted an accompanying presentation on our website to give further details supporting our remarks. This morning, I'd like to start by taking a step back and discussing our industry's macro environment. Since the conflict began in Iran, we haven't seen a material impact on pricing or lease rates. Demand remains robust. We have minimal exposure in the Middle East, where the effects are being felt most acutely. Airlines are reacting to higher fuel prices and the prospect of fuel shortages by reducing capacity, in some cases, flying less frequently and in other cases, parking aircraft. Should high fuel prices persist into the fall, we expect the airlines to feel liquidity pressure. Historically, we have been countercyclical in such environments. When airlines are trying to preserve cash, they tend to opt for leasing solutions rather than overhauling engines for $10 million or more, which drives up utilization in our portfolio. We have seen this phenomenon firsthand following prior periods of macro disruption. If fuel prices remain elevated longer than anticipated, some of the parked aircraft will likely be retired, and that could lead to lower lease rates and values for midlife aircraft. We would expect changes in midlife engine values to be more resilient than aircraft as they will continue to support shop visit avoidance, as I described earlier. However, and even in spite of this, we consider ourselves to be well hedged with over 50% of our engine portfolio in modern technology, specifically the LEAP, GTF and GEnx engine types. Another way for airlines to address short-term liquidity concerns is the sale and leaseback transactions for their unencumbered aircraft and engines. Our capital strategy over the past year has positioned us well to capture such opportunities. Turning to the quarter. We ended with $4.1 billion of assets under management, approximately $1.5 billion of capital that is ready to deploy through our discretionary funds and capital through our joint ventures to include a $750 million revolving credit facility. This, combined with undrawn amounts in our recently expanded $1.75 billion revolver and our low net leverage of 2.7x, we are positioned for significant growth. As we have talked about in prior quarters, the aviation market remains increasingly engine-centric, and that dynamic is driving demand across our platform. Engine availability remains a key constraint to both delivering new aircraft and keeping operational aircraft flying. And we continue to see extended maintenance timelines and sustained pressure on spare engine supply. This environment supports strong lease rate dynamics and ongoing demand for our leasing and services offerings. Continued strong demand for our products and services helped us deliver first quarter adjusted EBITDA of $124 million and fully diluted earnings per share of $3.26 as compared to $2.21 during the same period in 2025. We have also seen strong stock price appreciation during the first quarter despite market volatility driven by geopolitical uncertainties. We attribute this primarily to the strength of our underlying business as well as investors' confidence in our growth strategy, both on and off balance sheet. This strategy will deliver synergistic benefits through fees and carried interest, along with additional advantages such as a larger asset base that we can service through our two engine MROs, our airframe MRO, our parts business and our consulting business. Let me take a few minutes to discuss the 3 key areas of our business: leasing, Willis Aviation Capital and services. First, leasing. Leasing utilization for the quarter was up to 86% from 80% year-over-year, and the lease rate factor of our on-lease assets was 1.04%. As mentioned earlier, we continue to modernize the portfolio towards the next generation of assets. And although higher in value, we are experiencing similar lease rate factors as compared to the current generation of assets. These factors led the company to experience an all-time high lease rent revenue during the first quarter of 2026, totaling $77 million, demonstrating the strength of the aviation market, demand for next-generation assets and improved lease rate dynamics. We are able to effectively optimize asset placement across global customer base through our programs such as ConstantThrust. Under ConstantThrust, operators' engines are seamlessly exchanged with fully serviceable replacements from our pool of owned and managed assets as they come off-wing. This program specifically leverages WLFC's global expertise in spare engine provisioning, technical management and maintenance and repair services to ensure uninterrupted operational performance for airlines worldwide. Earlier this year, we expanded our constant thrust program by signing a new purchase and leaseback agreement with Nauru Airlines for CFM56-7B engines. The agreement will provide Nauru with reliable constant thrust support for the airline's entire fleet of CFM56-7B engines, powering Boeing 737-700 and 800 aircraft for 6-plus years. Turning to Willis Aviation Capital, or WAC. Last quarter, we announced Willis Aviation Capital, which is a natural extension of our business and enables us to manage third-party capital alongside our balance sheet and significantly expand our addressable market. This creates a flywheel effect where greater scale drives more opportunities to deploy our services across a larger asset base, enhancing returns and accelerating platform growth. Through our partnerships with Blackstone Credit & Insurance and Liberty Mutual Investments as well as our existing joint ventures, Black now manages more than $2.7 billion of committed or deployed capital. In the first quarter of 2026, we funded approximately $90 million of finance leases through our Liberty Mutual Fund, which do not generate gain on sale as these were par sales to the fund. In April, we began selling operating lease engines from our balance sheet to the Blackstone fund. We are encouraged by the early traction we're seeing with a solid pipeline of opportunities as we move through the year. This platform is designed to generate high-quality recurring earnings through the management fees and carried interest while also driving incremental demand for our services capabilities. And finally, services. Our services businesses remain a core strength for our platform, reducing both off-wing time across our fleet and turnaround times for our own customers' assets as compared to larger MROs. As I've mentioned before, the outlook for engine shop visits remains strong through the mid-2030s and our services businesses remain a key differentiator, playing a critical role as engine maintenance demand grows. Having multiple geographically distinct hospital shops, we are well positioned to capitalize on demand across those markets since we are the low-cost alternative to more costly full overhauls. To meet growing demand for the technical and maintenance expertise of our engine shops, which contributed revenue of $10 million in the first quarter. Exclusive of intercompany sales and to enhance our vertical integration, we continue to invest in deepening our in-house technical capabilities. In February, we announced the successful completion of our first core engine restoration of the CFM56-7B in our U.S.-based Willis Engine repair center. We have branded this new capability as Willis Module Shop, allowing us to complete comprehensive core restorations that reduce maintenance cost, improve turnaround time and strengthen the control over our assets. Over time, we believe this capability will be an important driver of both operational efficiency and portfolio returns. Now to touch briefly on our capital deployment priorities. To support future growth across our platform, we have increased our financial flexibility through an amendment and extension of our revolving credit facility from $1 billion to $1.75 billion. The amended facility positions us with the liquidity and flexibility to further expand our business. Additionally, we closed 2 Japanese operating lease with call option or JOLCO transactions, totaling approximately $50 million. These transactions reflect the strength of our lender relationships and our ongoing focus on maintaining a well-capitalized flexible balance sheet. Scott will speak to the specifics of these transactions momentarily. We have also continued to invest in top talent where we see growth opportunities, particularly in the Asia Pacific region. We welcomed Marilyn Gan as Head of Origination for the region, strengthening our ability to source and execute opportunities in a key growth market. Looking ahead, we remain well positioned to deploy capital across a broad range of opportunities. We see attractive prospects across leasing and services, supported by strong long-term fundamentals in the aviation market. We also remain committed to returning capital to our shareholders as evidenced by the quarterly recurring dividend of $0.40 per share that we declared earlier this quarter. Overall, we are confident in our strategy and the progress we are making as we continue to scale our platform and deliver long-term value for our shareholders. And with that, I'll hand it over to Scott Flaherty, our CFO, to discuss our financial performance in greater depth. Scott Flaherty: Thank you, Austin, and good morning all. Another strong quarter for Willis Lease Finance. Our first quarter experienced record quarterly lease rent revenues of $77.4 million, quarterly adjusted EBITDA of $123.8 million, $36.8 million of quarterly earnings before taxes, or EBT, and $23.7 million of net income attributable to common shareholders or $3.26 of diluted weighted average income per common share. Walking through the P&L, our strong top line performance reflected solid growth in nearly every revenue channel, record lease rent revenues of $77.4 million in the quarter. 14.2% quarter-over-quarter growth in lease rent revenues were driven by a combination of increased portfolio size, utilization and lease rates. Our owned portfolio at the end of the first quarter was $2.86 billion. Our own portfolio is reflected on the balance sheet as equipment held for operating lease, maintenance rights, notes receivable and investment in sales type leases. Average utilization was up from 79.9% in Q1 of 2025 to 85.8% in Q1 of 2026, a nearly 6-point pickup. Additionally, we continue to see a solid average on-lease rate factor across the portfolio of 1.04% compared to 1.0% in the first quarter of 2025. Maintenance reserve revenues for the quarter were $55.5 million, up slightly from $54.9 million in the first quarter of 2025. $12.4 million of these maintenance reserve revenues were long-term maintenance reserve revenue associated with engines coming off-lease and the associated elimination of any maintenance reserve liabilities as well as the receipt of end of the lease cash payments. $12.3 million of this related to one engine coming off-lease and included both the release of a maintenance reserve and the receipt of an end-of-lease cash payment. The $12.4 million in long-term maintenance reserve revenue compared to $9.6 million in the first quarter of 2025. $43.1 million of our maintenance reserve revenues were short-term maintenance reserves compared to $45.3 million in the prior comparable period. Spare parts and equipment sales increased by $3.4 million or 18.9% to $21.7 million in the first quarter of 2026 compared to $18.2 million in the first quarter of 2025. Spare parts sales were $10 million and $16 million in Q1 of '26 and 2025, respectively, a decrease of $5.8 million. The decrease in spare parts sales reflects variations in the timing of sales to third parties and were not reflective of $7.5 million of intercompany sales, which was up from the prior comparable period and eliminated in our financial consolidation. These intercompany sales represent the added value of having a vertically integrated parts business. Equipment sales in the first quarter of 2026 were $11.4 million, up $9.2 million from the prior comparable period. These revenues reflect the sale of 3 engines that were not previously leased. The trading profit on sale of these 3 engines was $5.7 million, representing a 50% margin on these sales, validating the significant discount that exists between the book value and the market value of our portfolio. Equipment sales for the 3 months ended March 31, '25, were $2.2 million for the sale of 1 engine. Gain on sale of leased equipment, together with our gain on sale of financial assets, a net revenue metric, aggregated to $18.4 million in the first quarter, up $13.6 million from the $4.8 million in the comparable prior period. The $18 million gain on leased equipment was associated with the sale of 14 engines for $60 million of gross sales. Included in our engine sales were 5 engines sold to our Willis Mitsui joint venture. The gain on sale represents an effective 30% margin on such sales, further validating the significant discount that exists between the book value and the market value of our portfolio. The company recognized $0.4 million of gain on sale of financial assets where we sold 11 notes receivable and investment in sales-type leases for $87.1 million of gross sales, which generally reflects car sales of these financial assets. Maintenance services revenue, which represents fleet management, engine and aircraft storage and repair services and revenues related to management of fixed base operator services was $9.8 million in the first quarter of 2026, up 74.9% from $5.6 million in the comparable period in 2025. The increase reflects growth in engine and aircraft storage and repair services, especially when factoring the lack of comparable period fleet management revenues in the current period due to the sale of our BAML business in late Q2 2025. Gross margins grew to 9.3% from 4.6% in the prior comparable period. Our maintenance service offering enhance our customer program solutions and provide vertical integration to increase the profitability of our owned and managed assets. Management and advisory fees represent the fees generated through our asset management efforts. These fees include those made from our joint ventures and other managed assets as well as through our new fund strategy announced at the end of 2025. Management and advisory fees increased by $5.9 million to $7.9 million for the 3 months ended March 31, 2026, from $2 million for the 3 months ended March 31, 2025. This increase was primarily driven by $4.9 million of fees earned from our LMI or Liberty Mutual Fund in the company's role as general partner. The LMI fund commenced operations in March of '26 and reimbursed formation and other costs to the company, which flowed through both revenue and the G&A lines of our P&L. On the expense side of the equation, depreciation in the first quarter increased by $5.2 million or 20.6% to $30.2 million as compared to $25 million in the prior comparable quarter. The increase is primarily due to an increase in the size of our lease portfolio and the timing of placing acquired engines on lease, which starts their depreciation through the P&L. Write-down of equipment was $1.1 million in the first quarter, reflecting the write-down of 1 engine. There was $2.1 million of write-downs of equipment for the 3 months ended March 31, 2025, reflecting the write-down of 5 engines. G&A expenses increased by $8.9 million or 18.6% to $56.6 million in the first quarter of 2026 compared to $47.7 million for the first quarter of the prior comparable period. The increase primarily reflects a $12.5 million increase in personnel costs, which included an increase of $6.9 million in share-based compensation and an increase of $4.1 million in wages. The increase in share-based compensation reflects appreciation of the market value of the company's equity as well as share awards to new personnel to support the continued growth of the company. In January of '25, the company modified its share-based compensation program due to the significant rise in our stock price. The nearly 300% increase in the company's stock price since mid-2024 had a P&L effect as the company's historical plan was structured with predetermined share grants occurring after the achievement of specified goals or performance metrics. Generally, the share grants had a 3-year vesting, which created a noncash P&L effect over the vesting period. Our new share-based compensation plan will reduce share-based compensation expense savings, but such savings will not be fully realized until prior grants flow through the P&L. The $4.1 million increase in wages was driven by higher headcount to support the company's growth. Also contributing to the higher G&A cost was $4.9 million of costs, which were recharged to the LMI fund, with the associated revenue of $4.9 million included in management and advisory fees. Lastly, G&A also included $2 million increase in acquisition, financing and divestiture-related expenses as compared to the prior period. Partially offsetting these increases was an $11.7 million reduction in project expense due to our decision to cease investment in and pursue strategic alternatives for the sustainable aviation fuels project. Technical expense was $9.7 million in the first quarter, up from $6.2 million in the comparable period of 2025. Technical expense generally relates to unplanned maintenance, whereas engine performance restorations tend to be planned and capitalized events. Net finance costs were up $7.6 million to $39.7 million in the first quarter compared to $32.1 million in the comparable period in 2025. The increase in costs was predominantly related to $7 million in loss on debt extinguishment related to refinancings completed in the quarter. Less than $1 million of the $7 million was a cash expense as the lion's share was related to an acceleration of previously incurred capitalized issuance costs. Total indebtedness remained relatively flat at $2.25 billion as compared to $2.23 billion in the comparable period of 2025. Our weighted average cost of debt capital, inclusive of swap agreements was 5.12%. The company also picked up $3 million in ratable earnings from our investments, which include our joint ventures and fund interests. Income from investments was up 126% and most significantly influenced by our Willis Mitsui joint venture. The company produced $23.7 million of net income attributable to common shareholders, which factors in GAAP taxes and the cost of our preferred equity, which was up 52.9% from the comparable period in 2025. Diluted weighted average income per share was $3.26 per share in the first quarter, up 47.5% from the $2.21 in the first quarter of 2025. Adjusted EBITDA for the quarter of 2026 was $123.8 million, up 19.9% from $103.3 million in the first quarter of 2025. We believe that our adjusted EBITDA reflects the normalized cash flow generation of the Willis enterprise. Our adjusted EBITDA makes adjustments to our net income attributable to common shareholders for income tax expense, interest expense, preferred stock dividends and costs, loss on debt extinguishment, depreciation and amortization expense, stock-based compensation expense, write-down of equipment, acquisition financing and divestiture-related expenses and other discrete gains and expenses. Net cash provided by operating activities was up 38.3% to 56.7% in the first quarter of 2026 as compared to $41 million in the first quarter of 2025. The increase was predominantly related to increased net income, the noncash effects of stock-based compensation, depreciation and the loss on debt extinguishment expenses and a period-over-period $10 million increase in cash flows from changes in other assets. On the financing and capital structure side of the business, the company completed its seventh and eighth JOLCO financings in the first quarter, bringing total JOLCO financings at quarter end to approximately $170 million. In March of 2026, the company amended and extended its existing revolving credit facility, increasing total commitments from $1 billion to $1.75 billion and extending the maturity out to April of 2031. The expansion of our credit facility provides Willis with increased liquidity and flexibility to pursue our growth strategy. Concurrent with the $750 million expansion of our credit facility, we terminated our $500 million warehouse facility. We regularly access the capital markets as we endeavor to source competitively priced capital to help continue to grow our balance sheet and P&L. In February, we paid our seventh consecutive regular quarterly dividend of $0.40 per share. Subsequent to quarter end, our Board of Directors declared our eighth consecutive recurring quarterly dividend of $0.40 per share, payable to holders at May 11, 2026, on May 22, 2026. Our recurring dividend provides shareholders with a moderate current cash yield on their investment while not degrading the strong cash flow of our business. With respect to leverage, as defined as total debt obligations, net of cash and restricted cash to equity, inclusive of preferred stock, our leverage ticked lower to 2.68x at the end of the first quarter of 2026. We have made significant strides over the last several years to reduce leverage to position Willis to be able to access market opportunities when they become available. With that, I will hand the call back to Austin. Austin Willis: Thank you, Scott. Q1 set in motion great momentum for the year ahead as we track towards our long-term strategy. growing our portfolio on balance sheet and managed assets through Willis Aviation Capital while bringing exciting opportunities to the entire Willis platform. Thank you for joining us on our call today. And with that, I will let the operator open up to Q&A. Operator: [Operator Instructions]. We'll go to Will Waller with M3F. William Waller: Excellent looking quarter. I was wondering if you could comment a bit more on the asset management business, like the Blackstone funds and so on. What the management fee and incentive fee will look like, if there's kind of any general parameters that you could give out as it relates to that? Austin Willis: Will, thanks for the question. So in terms of the funds, we're not disclosing what the specific management fees are. But I can tell you that they're roughly in line with what's standard for discretionary funds, a percentage of the value of the assets managed and then a percentage of the profitability via carried interest. We started deploying capital into Liberty Mutual in the first quarter, and you're really going to start to see the fees from that come in when we deploy more capital over time. And with respect to Blackstone, I think you'll start to see fees kicking in here in the next quarter. And as I mentioned earlier on my prepared remarks, we started to deploy capital there in April, so just subsequent to the quarter. I think we're probably going to see about $200 million from our balance sheet into the Blackstone portfolio. So that's a good starting point and then hopefully get the remainder deployed in relatively short order. William Waller: Great. That's super useful to hear, and we think it's a very wise strategy and that you're using all your knowledge to the fullest. So we really think highly of that strategy. So thanks for that additional information. Operator: With no other questions holding, I'll turn the conference back for any additional or closing remarks. Austin Willis: Thank you very much. We appreciate everybody giving us their time today. And I guess we answered all the questions in our lengthy prepared remarks. So thank you very much. Take care. Operator: Thank you. Ladies and gentlemen, that will conclude today's call. We thank you for your participation. You may disconnect at this time. Before you buy stock in Willis Lease Finance, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Willis Lease Finance wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. 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As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Willis Lease (WLFC) Q1 2026 Earnings Transcript was originally published by The Motley Fool