FLY Leasing Reports Third Quarter 2012 Financial Results

           FLY Leasing Reports Third Quarter 2012 Financial Results

PR Newswire

DUBLIN, Nov. 8, 2012

DUBLIN, Nov. 8, 2012 /PRNewswire/ --FLY Leasing Limited (NYSE: FLY) ("FLY"),
a global lessor of modern, fuel-efficient commercial jet aircraft, today
announced its financial results for the third quarter of 2012.

Third Quarter 2012 Highlights

  oAdjusted Net Income of $5.4 million, $0.21 per share
  oNet loss of $29.4 million or $1.15 per share, including one-time expenses
    related to the Term Loan of $33.9 million
  oEntered into a new $395 million Senior Secured Term Loan, reducing net
    leverage to 4.2x
  oPurchased two B737-800s, bringing fleet to 110 aircraft
  oDeclared a dividend of $0.22 per share on October 15th
  oClosed $250 million aircraft acquisition facility on November 7^th

"FLY is reporting a net loss of $29 million for the third quarter due to
one-time charges including the termination of interest rate swaps associated
with the debt refinancing completed in August," said Colm Barrington, CEO of
FLY. "The refinancing achieved several important objectives including
providing long-term financing with an attractive free cash profile, reducing
leverage and future interest costs, and eliminating significant refinancing
requirements through 2018."

"Our fleet generated strong revenue in the quarter," added Barrington. "The
portfolio of 49 aircraft acquired last year is now contributing significantly
to our bottom line, helping to grow our Adjusted Net Income as compared to the
same period of last year and demonstrating the true value of the strategic
acquisition."

"During the third quarter, we acquired two additional B737-800s, growing our
fleet to 110 aircraft on lease to 53 airlines in 29 countries," said
Barrington. "We continue to see attractive opportunities for growth and FLY is
well positioned to take advantage of these prospects, with $115 million of
unrestricted cash and the $250 million new aircraft acquisition facility we
recently closed."

Third Quarter Financial Results

FLY is reporting a net loss for the third quarter of 2012 of $29.4 million or
$1.15 per share. This compares to net income of $3.4 million and $0.13 per
share for the same period of 2011. The loss is attributable to pre-tax,
one-time, refinancing related expenses of $33.9 million, including a pre-tax
charge of $32.3 million to terminate interest rate swaps associated with a
credit facility that was fully repaid during the quarter. Operating lease
revenue increased to $84.4 million for the third quarter of 2012 from $47.4
million for the same period in 2011, primarily due to growth in the aircraft
portfolio following the aircraft acquisitions completed in late 2011.

Net income and diluted earnings per share for the nine months ended September
30, 2012 were $16.7 million and $0.63 per share compared to $10.3 million and
$0.39 per share for the same period in 2011. The increase is due to income
from the additional aircraft in the portfolio, partially offset by one-time
refinancing related expenses.

Adjusted Net Income

Adjusted Net Income was $5.4 million or $0.21 per share for the third quarter
of 2012 compared to $4.3 million or $0.17 per share in the third quarter of
the previous year.

For the nine-months ended September 30, 2012, Adjusted Net Income was $63.1
million ($2.43 per share) compared to $15.1 million ($0.58 per share) for the
same period of the previous year. The significant increase reflects the income
from the increased portfolio and additional end of lease income in 2012 as
compared to 2011.

A reconciliation of Adjusted Net Income to net income determined in accordance
with GAAP is shown below.

Dividend

On October 15, 2012, FLY declared a dividend of $0.22 per share in respect of
the third quarter of 2012. This dividend will be paid on November 20, 2012 to
shareholders of record on October 30, 2012. This dividend is the 20^th
consecutive quarterly dividend declared by FLY.

Financial Position

At September 30, 2012, FLY's total assets were $3.0 billion, including flight
equipment with a net book value of $2.7 billion. Restricted and unrestricted
cash at September 30, 2012 totalled $281.7 million, of which $115.0 million
was unrestricted. These amounts compare to total cash of $380.5 million and
unrestricted cash of $82.1 million at December 31, 2011.

FLY entered into a new $395 million senior term loan secured by 23 aircraft
and maturing in 2018. The refinancing addressed all of FLY's remaining 2012
debt maturities as well as amounts due under a facility maturing in 2013. As a
result of the refinancing, FLY's net leverage, defined as the ratio of net
debt to total shareholders' equity was reduced to 4.2x at September 30, 2012
compared to 5.1x at December 31, 2011. Net debt is defined as book value of
secured borrowings, less unrestricted cash and cash equivalents.

Aircraft Portfolio

At September 30, 2012, FLY's 110 aircraft were on lease to 53 lessees in 29
countries. The table below shows the aircraft in FLY's portfolio on September
30, 2012 and December 31, 2011. The table does not include the four B767
aircraft owned by a joint venture in which FLY has a 57% interest.

Portfolio at Sept 30, 2012 Dec 31, 2011
Airbus A319  20            20
Airbus A320  27            29
Airbus A330  1             1
Airbus A340  3             3
Boeing 717   6             6
Boeing 737   40            37
Boeing 747   1             1
Boeing 757   11            11
Boeing 767   1             1
 Total  110           109

At September 30, 2012, the average age of FLY's fleet was 9.2 years, weighted
by the net book value of each aircraft. The average remaining lease term was
3.1 years, also weighted by net book value. At September 30, 2012, the leases
were generating annualized revenues of approximately $341 million. For the
third quarter of 2012, FLY's lease utilization factor was 96% and for the nine
months ended September 30, 2012 the lease utilization factor was 98%.

Conference Call and Webcast

FLY's senior management will host a conference call and webcast to discuss
these results at 4:30 p.m. U.S. Eastern Time on Thursday, November 8, 2012.
Participants should call +1-706-758-4339 (International) or 877-309-0213
(North America) and enter confirmation code 32843684 or ask an operator for
the FLY Leasing earnings call. A replay will be available shortly after the
call. To access the replay, please dial +1-404-537-3406 (International) or
855-859-2056 (North America) and enter confirmation code 32843684. The replay
recording will be available until November 22, 2012.

A live webcast of the conference call will be also available on the Events
page in the Investor Relations section of FLY's website at www.flyleasing.com.
An archived webcast will be available for one year.

About FLY

FLY acquires and leases modern, high-demand and fuel-efficient commercial jet
aircraft under multi-year operating lease contracts to a diverse group of
airlines throughout the world. FLY is managed and serviced by BBAM LP, one of
the world's leading aircraft lease managers with more than 20 years of
experience. For more information about FLY, please visit our website at
www.flyleasing.com.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains certain "forward - looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements may be identified by words such as "expects,"
"intends," "anticipates," "plans," "believes," "seeks," "estimates," "will,"
or words of similar meaning and include, but are not limited to, statements
regarding the outlook for FLY's future business and financial performance.
Forward-looking statements are based on management's current expectations and
assumptions, which are subject to inherent uncertainties, risks and changes in
circumstances that are difficult to predict. Actual outcomes and results may
differ materially due to global political, economic, business, competitive,
market, regulatory and other factors and risks. FLY expressly disclaims any
obligation to update or revise any of these forward-looking statements,
whether because of future events, new information, a change in its views or
expectations, or otherwise.

Contact:

Matt Dallas
FLY Leasing Limited
+1 203-769-5916
ir@flyleasing.com

FLY Leasing Limited

Consolidated Statements of Income

(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
                    Three months  Three months Nine months     Nine months
                    ended         ended
                                               ended           ended
                    Sept.         Sept.
                    30,2012     30,2011     Sept.30,2012 Sept.30,2011
                    (Unaudited)   (Unaudited)
                                               (Unaudited)     (Unaudited)
Revenues
 Operating lease  $  84,443    $  47,387   $ 285,800      $  149,149
revenue
 Equity earnings
from unconsolidated 1,852         1,289        5,980           2,626
joint ventures
 Gain on sale of  -             −            8,489           −
aircraft
 Interest and     113           761          1,556           2,502
other income
Total revenues      86,408        49,437       301,825         154,277
Expenses
 Depreciation     34,302        21,158       102,795         62,723
 Interest expense 36,045        18,278       109,695         55,174
 Selling, general 11,435        5,756        30,213          19,653
and administrative
 Ineffective,
dedesignated and    32,580        -            31,353
terminated
derivatives
 Maintenance and  3,478         184          6,138           4,103
other costs
Total expenses      117,840       45,376       280,194         141,653
Net income (loss)
before provision    (31,432)      4,061        21,631          12,624
for income taxes
 Provision for    (1,993)       645          4,954           2,347
income taxes
Net income (loss)   $  (29,439) $  3,416    $ 16,677       $  10,277
Weighted average
number of shares
- Basic            25,769,115    25,647,373   25,750,811      25,904,913
- Diluted          25,769,115    25,841,921   25,915,110      26,054,343
Earnings (loss) per
share
- Basic           $  (1.15)    $  0.13     $  0.63        $  0.39
- Diluted         $ (1.15)     $ 0.13      $ 0.63         $ 0.39
Dividends declared  $  0.22      $  0.20     $  0.62        $  0.60
and paid per share





FLY Leasing Limited

Consolidated Balance Sheets

(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
                                                  Sept. 30,
                                                              Dec. 31, 2011
                                                  2012
                                                              (Audited)
                                                  (Unaudited)
Assets
 Cash and cash equivalents                      $ 114,998  $   82,105
 Restricted cash and cash equivalents           166,698     298,404
 Rent receivables                               713         3,186
 Investment in unconsolidated joint ventures    15,921      15,141
 Flight equipment held for operating leases,    2,678,305   2,762,289
net
 Deferred tax asset, net                        -           5,329
 Fair market value of derivative asset          738         4,023
 Other assets, net                              30,191      28,021
Total assets                                      $ 3,007,564 $ 3,198,498
Liabilities
 Accounts payable and accrued liabilities       20,493      10,429
 Rentals received in advance                    14,835      15,297
 Payable to related parties                     2,774       4,863
 Security deposits                              48,121      50,672
 Maintenance payment liabilities                231,467     231,793
 Secured borrowings, net                        2,136,510   2,326,110
 Deferred tax liability, net                    986         -
 Fair market value of derivative liabilities    54,473      98,487
 Other liabilities                              20,022      17,814
Total liabilities                                 2,529,681   2,755,465
Shareholders' equity
Common shares, $0.001 par value, 499,999,900
shares authorized; 25,769,115 and 25,685,527      26          26
shares issued and outstanding at September 30,
2012 and December 31, 2011, respectively
 Manager shares, $0.001 par value; 100 shares   −           −
authorized, issued and outstanding
 Additional paid in capital                     458,290     455,186
 Retained earnings                              58,342      57,982
 Accumulated other comprehensive loss, net      (38,775)    (70,161)
Total shareholders' equity                        477,883     443,033
Total liabilities and shareholders' equity        $ 3,007,564 $ 3,198,498



FLY Leasing Limited

Reconciliation of Adjusted Net Income, a Non-GAAP Financial Measure, to Net
Income

(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA)
                                   Three       Nine months     Nine months
                    Three months   months
                    ended          ended       ended           ended

                    Sept.30,2012 Sept.       Sept.30,2012 Sept.30,2011
                    (Unaudited)    30,2011
                                   (Unaudited) (Unaudited)     (Unaudited)
Net Income          $  (29,439)   $  3,416   $  16,677      $  10,277
Add (less):
 Ineffective,
dedesignated and    32,580         -           31,353          -
terminated
derivatives
  Non-cash share  1,458          733         3,104           3,096
 based compensation
  Adjustments
 related to GAAM
 Portfolio
 acquisition:
 
 Amortization
 of fair value
 adjustments        5,606          -           18,158          -
 recorded in
 purchase
 accounting
  Acquisition
 transaction fees   -              182         -               1,929
 and expenses
  Income tax      (4,801)        (23)        (6,222)         (241)
 effects
 Adjusted Net       $  5,404      $  4,308   $  63,070      $  15,061
 Income
 Weighted average
 diluted shares     25,960,109     25,841,921  25,915,110      26,054,343
 outstanding
 Adjusted Net       $  0.21       $  0.17    $  2.43        $  0.58
 Income per share

Adjusted Net Income Plus Depreciation and Amortization, a Non-GAAP Financial
Measure, to Net Income

(DOLLARS IN THOUSANDS)
                     Three months Three months Nine months     Nine months
                     ended        ended
                                               ended           ended
                     Sept.        Sept.
                     30,2012     30,2011     Sept.30,2012 Sept.30,2011
                     (Unaudited)  (Unaudited)
                                               (Unaudited)     (Unaudited)
Adjusted Net Income  $  5,404    $  4,308    $  63,070      $  15,061
Add:
 Depreciation      34,302       21,158       102,795         62,723
 Other             7,427        3,465        14,873          10,934
amortization
   Provision for
  deferred income    2,014        351          9,395           1,659
  taxes
  Adjusted Net
  Income Plus        $  49,147   $  29,282   $  190,133     $  90,377
  Depreciation and
  Amortization

FLY defines Adjusted Net Income as net income plus or minus the after-tax
impacts of ineffective, dedesignated or terminated cash flow hedges, swap
termination costs, non-cash share-based compensation, and adjustments related
to the GAAM portfolio acquisition comprised of amortization of fair value
adjustments recorded in purchase accounting and acquisition transaction fees
and expenses. FLY believes that Adjusted Net Income provides useful
information about operating performance and period over period comparisons.
It also provides additional information that is useful for evaluating the
underlying operating performance of our business without regard to the impacts
of fair-value adjustments of debt that the company has assumed, acquired
leases and derivative instruments and other non-recurring items of income and
expense affecting current period results. Adjusted Net Income should be used
as a supplement to and not as a substitute for financial measures determined
in accordance with Generally Accepted Accounting Principles in the United
States.

Adjusted Net Income Plus Depreciation and Amortization is a cash flow measure
that provides investors with an additional measure for evaluating FLY's
ongoing cash earnings, from which capital investments are made, debt is
serviced and dividends are paid. However, adjusted net income plus
depreciation and amortization excludes certain positive and negative cash
items, including principal payments, and has certain important limitations as
an indicator of FLY's ability to pay dividends and reinvest in its business.
Management uses Adjusted Net Income and Adjusted Net Income Plus Depreciation
and Amortization as a measure for assessing FLY's performance. These measures
should be considered in addition to, not as a substitute for net income or
other financial measures determined in accordance with GAAP. Finally, FLY's
definitions may be different than those used by other companies.



SOURCE FLY Leasing Limited

Website: http://www.flyleasing.com