Chorus Aviation expands leasing portfolio with the addition of two ATR 72-600s on lease to Malindo Air
Oct 7, 2019
Delivering regional aviation to the world
HALIFAX, Oct. 7, 2019 /CNW/ - Chorus Aviation Inc. ('Chorus') (TSX: CHR) announced today that Chorus Aviation Capital ('CAC') has acquired two ATR72-600 aircraft (MSNs 1147, 1154) on lease to Malindo Air, a Malaysian operator forming part of the Lion Air Group. Earlier this year, CAC also delivered two new ATR 72-600 aircraft (MSNs 1577 and 1579) for lease to Malindo Air, bringing the total number of aircraft leased by CAC to the Lion Air Group to five. With these acquisitions, Chorus Aviation Capital has announced 581 commitments to date for its regional aircraft leasing business.
"We are delighted to expand our relationship with Malindo Air and the Lion Air Group in the fast-growing and increasingly significant Southeast Asian market," said Steve Ridolfi, President, Chorus Aviation Capital. "So far this year, we've secured lease commitments for 24 aircraft and continue to evaluate several additional opportunities. To date, we've grown the value of our leasing portfolio to approximately US $1.1 billion with US $815.0 million in future contract lease revenue."
"This solid growth trajectory has led to a very strong portfolio of brand name regional airlines with aircraft type and geographic diversity. Since the launch of the business, we have grown the regional aircraft leasing segment by an average of approximately 20 aircraft per year. In the near term, we have the capacity to continue with a similar rate of growth through a combination of additional debt and internally generated cash flows to fund the equity portion of the aircraft acquisitions," commented Joe Randell, President and Chief Executive Officer, Chorus.
Upon the completion of this transaction, and four pending aircraft deliveries to other customers, CAC's portfolio will include 46 turboprops and 12 regional jets. When the aircraft earning leasing revenue under the Capacity Purchase Agreement are added to the aircraft in CAC's portfolio, Chorus' total leased portfolio grows to 124 aircraft valued at approximately US $2.0 billion.1
About Chorus Aviation Capital
Established in 2017, Chorus Aviation Capital currently has relationships with 15 regional airlines based in 15 countries. CAC is focused on building a portfolio of new and mid-life regional aircraft, while leveraging the synergies inherent among its affiliated companies to provide a full suite of regional aviation services.
Headquartered in Halifax, Nova Scotia, Chorus was incorporated on September 27, 2010. Chorus' vision is to deliver regional aviation to the world. Chorus has been leasing its owned regional aircraft into Jazz's Air Canada Express operation since 2011, and established Chorus Aviation Capital to become a leading, global provider of regional aircraft leases. Chorus also owns Jazz Aviation LP and Voyageur Aviation Corp. – companies that have long histories of safe and solid operations that deliver excellent customer service in the areas of contract flying operations, engineering, fleet management, and maintenance, repair and overhaul. Together, the Chorus group of companies can provide a full suite of regional aviation support services. Chorus Class A Variable Voting Shares and Class B Voting Shares trade on the Toronto Stock Exchange under the trading symbol 'CHR'. www.chorusaviation.com
About Malindo Air
Malindo Air is a Malaysian premium airline with headquarters in Petaling Jaya, Selangor, Malaysia. Malindo Air operates from the Kuala Lumpur International Airport (KLIA) and the Sultan Abdul Aziz Shah Airport (also known as the Subang Airport, Subang SkyPark or LTSAAS) in Subang, Selangor, Malaysia. The carrier currently operates a young fleet of Boeing 737-900ER, 737-800 and ATR72-600 aircraft for both domestic and international flights.
The carrier operates a network of scheduled passenger services throughout Malaysia and has spread its wings to regional destinations in Indonesia, Thailand, Bangladesh, India, Singapore, Nepal, Sri Lanka, Australia and Pakistan covering an extensive network of almost 68 routes in the region. Malindo Air prides itself in offering its customers attractive fares, on-time flights and excellent customer service both on-ground and in-flight. In-flight connectivity services Malindo WiFi and Malindo Mobile were introduced in June 2015, as a product enhancement on board its B737-900ER fleet. Currently, Malindo Air has 1,500 flights travelling weekly to over 58 destinations
This news release may contain 'forward-looking information'. Forward-looking information is identified by the use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "potential", "pending", "project", "will", "would", and similar terms and phrases. Forward-looking information involves known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to differ materially from those indicated in the forward-looking information. Actual results may differ materially from results indicated in forward-looking information for a number of reasons, including the failure to close the transactions referenced in this news release on the terms and conditions currently contemplated by Chorus, or at all, as well the risk factors identified in Chorus' Annual Information Form dated February 21, 2019 and in Chorus' public disclosure record available at www.sedar.com. Statements containing forward-looking information in this news release represent Chorus' expectations as of the date of this news release (or as of the date they are otherwise stated to be made) and are subject to change after such date. Chorus disclaims any intention or obligation to update or revise such statements to reflect new information, subsequent events or otherwise, unless required by applicable securities laws.
1 There are currently four pending aircraft leasing transactions in the Regional Aircraft Leasing segment. Future aircraft leasing commitments in the Regional Aviation Services segment consist of nine CRJ900s to be received in 2020 and 10 ESPs that are planned for completion between 2019 and 2022. For a description of Chorus' reporting segments, please refer to the financial statements and management's discussion and analysis for the quarter ended June 30, 2019. A foreign exchange rate of $1.2600 (based on the long-term average historical rate) was used in the calculation of the estimates.
SOURCE Chorus Aviation Inc.
For further information: Chorus Media Contacts: Teri Udle, Halifax, Nova Scotia, (902) 873-5047, firstname.lastname@example.org; Debra Williams, Toronto, Ontario, (905) 671-7769, email@example.com; Analyst Contact: Nathalie Megann, Halifax, Nova Scotia, (902) 873-5094, firstname.lastname@example.org