The Middle East’s largest aircraft lessor, DAE, has said it expects to provide additional assistance to its airline customers in the form of rent deferrals.
Airlines in the region have been requesting deferrals on lease payments due to the ongoing Covid-19 crisis, which has stripped revenues and evaporated liquidity.
DAE has already granted 29 rent deferral requests, equating to 12% of its annual revenue. It is currently evaluating an additional 28 rent deferral requests, worth around 6% of its turnover, according to its half-year business update.
“We expect to provide additional assistance to our clients and we also expect arrears to climb as our clients continue to refine their operating models,” DAE said in a statement.
Firoz Tarapore, DAE’s CEO, said the first half of 2020 was “the most challenging half-year ever for the global aviation industry”.
“During the last six months, we have transitioned aircraft to new airline customers, we have actively taken back aircraft from airlines that did not need capacity and placed them with other existing clients, and we have grown our managed asset portfolio.”
DAE reported that it had sold or novated 17 aircraft, acquired five jets, transitioned or extended leases on 23 aircraft, and negotiated 41 lease extensions.
“Since the onset of the pandemic, we have transitioned 11 aircraft with 18 ferry flights to and from nine countries. Portfolio lease utilisation remained high and is above 99%. The managed aircraft portfolio grew to 73 aircraft,” the company said.
“We do not have any speculative orders with an OEM and we do not expect that to change in the near-term,” Tarapore confirmed.
DAE ended the first-half of 2020 with total available liquidity of $2.8 billion, which comprised of approximately 600 million of unrestricted cash and $2.2 billion of long-term committed available lines of credit.