SPREAD YOUR WINGS
TABLE OF CONTENTS
01 COMPANY OVERVIEW
02 BUSINESS JETS ACQUISITIONS
03 INTERNATIONAL TRANSATIONS AND AIRCRAFT SALES
04 PRE-PURCHASE INSPECTIONS
05 MAINTENANCE
06 10 STEPS TO SET UP A FLIGHT DEPARTMENT
07 AVIATION ASSETS PORTFOLIO
COMPANY OVERVIEW
FIELDS
Founded by Jay
Faria in 1989 in Expanded to US in 30+ years of
Belo Horizonte, 2008 experience
Brazil
COMMERCIAL
Over 300 aircraft
Over 350 clients imported and
Global operations
served exported to more
TECHNICAL
than 25 Countries
Technical team of aeronautical
engineers and aircraft mechanics, FINANCIAL
with more than 90 years of combined
experience in aviation
PORTFOLIO OF SERVICES
FINANCIAL LEGAL
Aircraft Transactions Import and Export
Market Forecasting Federal Aviation Agencies Regulations
Valuations, Appraisals and Depreciations Insurance
Investment in Aviation Assets for Resale Litigation Technical Support
Operational Costs
FIELD
MANAGEMENT Boreoscope Inspection
Compressor “Top case” repair
Aircraft Operations
Engine, Components and Airframe Maintenance
Manufacture Maintenance Programs
MAINTENANCE
Warranty Programs
Scheduled and Non-scheduled Inspections
Avionics repair, removal and installations
CONSULTANCY
PARTS
Acquisitions and Exit Strategies
Aviation Assets Advisory Garmin Dealer
Economical Repair Analysis Sales
Sourcing
Operational Risk Analysis Evaluation
SCOPE OF SERVICES
Investment in
Aircraft Acquisition Aircraft
Remarketing Aviation Assets for Exit Strategies
Consultancy Maintenance
Sale
Manufacture Technical Aspects:
Upgrades and Warranty
Maintenance Current/Future Records
Retrofit values Programs
Programs
Airframe and
Delivery & Re
Engines
Storage Programs Ferry Flights Hangar Services Delivery
Maintenance
Inspections
Programs
Technical
Inspections
CUSTOMERS
UBS
BNP Paribas
Morgan Stanley
Deutsche Bank
Natixis
Airtrade
Jay Faria
AirTrade
AAC Tradewinds
Capital
Aircraft Mgmnt Maintenance Portfolio Management
Real Assets Credit
Portfolio Portfolio
Aircraft Maint. & Insurance
CORPORATE STRUCTURE
ORGANIZATIONAL CHART
MEET THE TEAM
Jay Faria Andrea Faria Harry Driscoll
President & Commercial Vice President & Operations Manager
Director Managing Director
Selma Soti Damien Schaefer Raphaela Brant
General Manager European Sales Finance Manager
Manager
MEET THE TEAM
Gustavo Zummel Obadias Pires Wilton Alves
AirTrade Capital Aircraft Mechanic Aircraft
Maintenance
Planner
Taciana Faria Gina Levine Luciene Vieira
Legal Associate Administrative Procurement
FACILITY
Fort Lauderdale Executive Airport (KFXE)
1550 NW 62nd St. Hangar 18
Fort Lauderdale, FL 33309
HIGHLIGHTS OF OUR AVIATION HISTORY
ACQUISTION CONSULTANCY More than 400 contracts in the last 30+ years.
30+ years of consecutive work with more than 300 aircraft
MAINTENANCE serviced.
We have been personally in over 50 countries performing
GLOBAL OPERATIONS aviation businesses.
Our technical team is composed of qualified professionals and
HIGHLY QUALIFIED TEAM certified by manufacturers and aviation authorities.
AVIATION MARKET
• There is no geographical effect (if Europe is in • Market is fully audited and controlled.
crisis, fly to China!). • Number of aircraft sold and delivered are fully disclosed
• The business jet market is expected to grow and can be researched and analyzed, which allows a
41% on the US and 108% Worldwide over the complete view of the market.
next 20 years.
• Price fluctuations are very low (history). Depreciation is
predictable (appreciation is the case!).
• Aircraft are serialized, what allows a full view of the
market trends.
BUSINESS JETS ACQUISITIONS
AIRTRADE MARKET EXPERIENCE SUMMARY
30+ years of aviation activities
Business Aircraft Imports & Exports to 18 countries:
Aruba China Mexico
Belgium Cook Islands New Zealand
Bolivia Ecuador Russia
Brazil France San Marino
Canada Germany Spain
Cayman Islands Italy United Kingdom
MARKET SUMMARY
LIGHT & MIDSIZE JETS
Source: AMSTAT
Date: September 5th, 2018
MARKET SUMMARY
MIDSIZE JETS
Source: AMSTAT
Date: September 5th, 2018
MARKET SUMMARY
HEAVY JETS
Source: AMSTAT
Date: September 5th, 2018
PRACTICAL ASPECTS ON AIRCRAFT ACQUISITIONS
PRE-PURCHASE
LOI CLOSING
INSPECTION
Price Scope Date
Pre-Purchase Seller
Inspection Return To Service
Responsibilities
Special Reqs. Of Buyer
Terms Importing Country Responsibilities
Offer Valid Until Acceptance Flight Delivery Receipt
Acceptance Letter Acceptance Letter Funds Availability
Place
INTERNATIONAL TRANSACTIONS,
AIRCRAFT SALES, AND A VISION FOR THE FUTURE
AVIATION MARKET
INTERNATIONAL TRANSACTIONS
In business relations with different nations,
there are some barriers that we shall consider
when perfecting an international transaction:
Education Registration
Language Culture Trust Title
HUMAN
FACTOR LEGISLATION
AIRCRAFT SALES PROCESS
ADVERTISEMENT
Where to How to
Advertise? Advertise?
AIRCRAFT SALES PROCESS
TITLE SEARCH
Liens
Registry Pending Invoices
International Engines Title
AIRCRAFT SALES PROCESS
PURCHASE AGREEMENT:
TIMING & TIMES
For Aircraft For the
Delivery Deposit
For the Pre-
For Closing Purchase
Inspection
For
For Aircraft
Payment of Acceptance
Balance
AIRCRAFT SALES PROCESS
PRE-PURCHASE AGREEMENT & INSPECTION
Scope
“RTS”
Scope x Annual Inspection
Airworthiness Items x Non-Airworthy
No Go Items
Special Reqs. Of Importing Country
Bilateral Agreement
Work Scope x Airworthiness Reqs.
Acceptance Flight
AIRCRAFT SALES PROCESS
Export Deregistration
Certificate of
Airworthiness
Ferry Flight x Ferry
Permit x C/A
FOREX
Forex: USD x RUB
Hedging
Currency Risks
Forex: EUR x RUB
Source: www.bloomberg.com
Escrow in
Currencies Other
Than US Dollars
Forex: EUR x USD
Source: www.bloomberg.com
A VISION FOR THE FUTURE
Imports Fractional
X Ownership Rationalization Cost of Fuel
Export Outside USA of Costs
PRE-PURCHASE INSPECTIONS
CASE 1 CORROSION- PIPER ARROW
• Corrosion found on left main spar wing inside
the Wheel Well.
• Compartment of landing gear is difficult and
complicated access in this aircraft.
• Importance of cleaning before inspection.
CASE 2 BOOT REPAIR KING AIR C90
• Hard to know if de-icer boot is damaged unless you Maintenance Manual and Repairs for
turn on the engines and do an air cycle of boots or
a functional test in a maintenance facility. all Black Pneumatic De-icers
• Often, patches are put on boots, but when air cycle BEFORE
is done, the patch bursts, causing pressure loss in
the system.
• Since system works with low pressure, with this
rupture, the system cannot inflate all the boots.
• $8,000 repair cost per wing.
CASE 2 BOOT REPAIR KING AIR C90
AFTER
CASE 3 - AD 2014-15-15 – BEECHJET 400
• Upon checking logbooks, AD 2014-15-15 had not
been done but was not due.
• Decided to check, added to Pre-Purchase
Inspection.
• After reading the AD, it was found that it “was
prompted by multiple reports of fatigue cracking
in the horizontal stabilizer ribs”.
• Ribs replacement = $85,000
• Added as condition for pre-purchase this
replacement
• 1 – Boroscope inspection; or
• 2 – X-RAY inspection
• Sent to Beechcraft to perform this AD, where
cracks were found in the horizontal stabalizor’s
ribs by boroscope inspection.
IMPORTANCE OF HAVING A THROUGH AND
EXPERIENCED PRE-PURCHASE INSPECTOR
Liability:
Seller
X
Costs Buyer
Safety
Airtrade Aviation has 30+
Years of Experience with PPI
MAINTENANCE
Falcon 2000 Major Inspections
Citation Jet Structural Repair
S76C++ Redelivery
Seneca V: Imports/Exports
Learjet 60XR Major Inspections
Hawker 750 & Learjet 40XR:
Cross Border Transactions
Citation Jet in Paris:
Boroscope Inspection
Gulfstream 650ER:
Most Expensive Executive Jet Ever Built
Agusta 109: European Import
Agusta 109: European Import
10 STEPS TO SET UP
A FLIGHT DEPARTMENT
10 STEPS
Insurance Programs
Parts Airports
Hangar/
Maintenance
Storage
Buying or
HR
Leasing
Corporate
Flight Aviation
Fuel
Department Authority
10 STEPS
Insurance Programs
Parts Airports
Hangar/
Maintenance
Storage
Buying or
HR
Leasing
Corporate
Flight Aviation
Fuel
Department Authority
FUEL
Contracts
Fuel
Cards
FBO
Agreements
10 STEPS
Insurance Programs
Parts Airports
Hangar/
Maintenance
Storage
Buying or
HR
Leasing
Corporate
Flight Aviation
Fuel
Department Authority
HUMAN RESOURCES
Training
Crew
Pilots
10 STEPS
Insurance Programs
Parts Airports
Hangar/
Maintenance
Storage
Buying or
HR
Leasing
Corporate
Flight Aviation
Fuel
Department Authority
MAINTENANCE
Regulations
Mechanics x
Repair x Factory
Service Centers
10 STEPS
Insurance Programs
Parts Airports
Hangar/
Maintenance
Storage
Buying or
HR
Leasing
Corporate
Flight Aviation
Fuel
Department Authority
PARTS
Used
Parts
PMA
Parts Program
&
Traceability
10 STEPS
Insurance Programs
Parts Airports
Hangar/
Maintenance
Storage
Buying or
HR
Leasing
Corporate
Flight Aviation
Fuel
Department Authority
INSURANCE
Liability
War
&
Confiscation
International
Validation
10 STEPS
Insurance Programs
Parts Airports
Hangar/
Maintenance
Storage
Buying or
HR
Leasing
Corporate
Flight Aviation
Fuel
Department Authority
PROGRAMS
Avionics
Engines
Airframe
10 STEPS
Insurance Programs
Parts Airports
Hangar/
Maintenance
Storage
Buying or
HR
Leasing
Corporate
Flight Aviation
Fuel
Department Authority
AIRPORTS
Landing
Fees
Handlings
International
Operations
10 STEPS
Insurance Programs
Parts Airports
Hangar/
Maintenance
Storage
Buying or
HR
Leasing
Corporate
Flight Aviation
Fuel
Department Authority
HANGAR / STORAGE
Hangar
Programs
Storage
Programs
10 STEPS
Insurance Programs
Parts Airports
Hangar/
Maintenance
Storage
Buying or
HR
Leasing
Corporate
Flight Aviation
Fuel
Department Authority
BUYING OR LEASING
Bridge Loans
Leasing
Companies
Financial
Institutions
10 STEPS
Insurance Programs
Parts Airports
Hangar/
Maintenance
Storage
Buying or
HR
Leasing
Corporate
Flight Aviation
Fuel
Department Authority
AVIATION AUTHORITY
Certificate
Operations Of
Airworthiness
Advantages of
Offshore
Registrations
Regulations
Registrations
AVIATION ASSETS PORTFOLIO
The information presented in this document is highly sensitive and confidential and it is to be used by authorized parties for determining their preliminary indication of
interest in acquiring an executive aircraft portfolio.
Airtrade Aviation and other sources provided the information contained in the Presentation. Estimates and projections contained herein have been prepared by the
management of Airtrade Aviation and involve significant elements of subjective judgment and analysis that are based on certain assumptions. Actual results may vary
from estimates and projections, and these variations may be material. The projections, market assumptions and certain other statistics included in this Presentation are
based upon a number of estimates and assumptions which, although considered reasonable, are inherently subject to significant business, economic and competitive
uncertainties and contingencies, all of which are difficult to predict and many of which are beyond the control of Airtrade Aviation . Both the provider of this Presentation
and Airtrade Aviation expressly disclaim any and all liability which may be based on such information, errors therein or omissions therefrom. The recipient shall be entitled
to rely solely on the representations and warranties made in any final agreement, if any.
No representations or warranties, expressed or implied, are made as to the accuracy or completeness of the information contained in this Presentation, and nothing
contained herein shall be relied upon as, a promise or representation, as to the past or the future conditions or performance. The Presentation does not purport to
contain all the information that may be required to fully evaluate the Airtrade Aviation opportunities or a potential business relationship, and any recipient thereof should
conduct their own independent analysis and due diligence process.
In furnishing this Presentation, no obligation is established to provide the recipient with access to any additional information. This Presentation does not purport to
contain all of the information that may be required to evaluate the opportunity or a similar transaction and any recipient hereof should conduct its own independent
analysis of the opportunity. The right is expressly reserved, without having to give reasons thereof, at any time and in any respect, to terminate the discussions with any or
all prospective interested parties, to negotiate with any individual party with respect to a transaction or to change without prior notice any procedures which may have
been established.
THIS PRESENTATION IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE AN OFFER TO SELL OR SOLICITATION OF AN OFFER TO BUY ANY SECURITY.
All communications, inquiries and requests for additional information should be directed as follows:
Jay Faria
jay.faria@airtradeaviation.com
Notice – Confidentiality and Disclaimer
“WHAT” – The Asset Class – Aviation Assets
Aviation Assets can be seen as a Hybrid of Real Assets and PE
• Real Assets Angle: resilient capital gains (through buying and selling):
“The only bad time to buy an aircraft is later”(If you know what/how to buy).
• PE Angle: income (through effective marketing & operations)
“If you don’t know who you are, this is an expensive place to find out.”
• Historical, pre-Covid19 returns for properly managed pre-owned portfolios:
20%+ annual returns, 2yr-5yr exit horizon.
“WHAT” – Aviation Industry Overview
Military Aviation General Aviation
Commercial Aviation
- Aerial combat
- Airlines (Mainlines & Regional): - Business or pleasure flights: FAA
- Cargo transportation Part 91
scheduled flights, FAA Part 121 &
- Reconnaissance missions (intel Part 125 - Emergency medical evacuations
gathering)
- Charter Flights: non-scheduled - Airborne law enforcement
- Training military pilots and other flights, FAA Part 135 - Crop dusting operations
personnel
“WHAT” – The Asset Class – Executive Aviation Industry
Landscape
• Owners & • Charter Operation
• (Part 135)
• Sales Channels • Users
• Fleet Managers
Direct
Sales
Owned Fleet
Brokerages
Broker Membership
Managed Fleet
Programs
Jet Cards
Leased Fleet Ownership
Programs
“WHAT” – The Asset Class – Executive Aviation Industry Landscape
Market is fully audited and controlled.
Number of aircraft sold and delivered are fully disclosed and
can be researched and analyzed, which allows a complete view
of the market.
Aircraft are serialized, what allows a full view of the market
trends.
“WHY” – Investment Thesis – Executive Aviation Forecasts
• The midsize executive aircraft segment has strong
potential for growth.
• In particular, global UHNWIs (High Net Worth
Individuals) that were not regular private flight users
before COVID-19 are increasingly resorting to midsize
aircraft acquisitions and charter flights.
• Pre-COVID19, the
business jet market
was expected to grow
to 13,500 jets in
2032. It got to 13,700
precisely in 2019.
“WHY” – Investment Thesis – Executive Aviation Forecasts
“Who” – The Management Team
“How” – The Business Model
“How” – The Business Model
The Key Performance Drivers
Charter
Aircraft
Operation • Management of Executive Aircraft as an investment
Remarketing portfolio is a balancing act.
• Managers must choose the timing for Capital Gains
(through aircraft trading) and Income (through Charter
Operations).
“How” – Execution: Airtrade and its Ecosystem
“How” – Execution: Aircraft Remarketing Case 1
CASE 1 – CITATION JET 1999
MAR 03, 2011 APR 24, 2011
INVESTMENT $ 1,537,000 SALES REVENUE $ 1,670,000
Acquisition value $ 1,525,000 Gross revenue $ 133,000
Re-marketing expenses $ 12,000 20% Fee (Airtrade) $ 26,600
NET REVENUE $ 106,400
$106,400
NET REVENUE
6.9%
RETURN ON INVESTMENT
52 DAYS
“How” – Execution: Aircraft Remarketing Case 2
CASE 2 – CITATION JET 1997
JAN, 2013 JUN, 2013
INVESTMENT $ 1,120,000 SALES REVENUE $ 1,450,000
Acquisition value $ 1,080,000 Gross revenue $ 330,000
Re-marketing expenses $ 40,000 20% Fee (Airtrade) $ 66,000
NET REVENUE $ 264,000
$264,000
NET REVENUE
24.4%
RETURN ON INVESTMENT
180 DAYS
“How” – Airtrade Capital Partners & Airtrade Aviation
Airtrade Capital
Partners
Portfolio Management
Investors
Airtrade
Aviation Capital
Asset Management
ACP Fund I ACP Fund II ACP Fund …
Aircraft Portfolio – Closed Aircraft Portfolio - $30mm+ Aircraft Portfolio - Future
“How” – Portfolio Strategic Allocation
Light & ‘Superlight’ Midsize & ‘Supermid’ Large/Long Range
- Up to 19,000lb MTOW - 19,000 to 45,000lb MTOW - 45,000 to 115,000 MTOW
- Up to 8 Pax, generally - Up to 12 Pax, generally - Up to 19 Pax
- Up to 1,500nm range, generally - Up to 4,000nm range - Up to 8,000nm range
- Price: $1mm-$5mm, pre-owned - Price: $5mm-$10mm, pre- - Price: $7mm+
- Examples: Learjet 31, Learjet owned
- Examples: Challenger 600/Global
35/36, Beechjet, Citation CJ, - Examples: Hawker, Citation series, Gulfstream G-IV/G-V/
Embraer Phenom 100 & 300 Longitude, Challenger 300/350, G650/G700, Falcon 7x/8x/10x,
Falcon 2000/900, Gulfstream Embraer Legacy 600/650
G280, Legacy/Praetor 450/500
“How” – Portfolio Tactical Allocation
Tactical Allocation Sample $20mm Portfolio:
Main features 6 Aircraft
• 3 Light Aircraft:
• Optimal returns resulting from
optimal aircraft model choice • $2mm/aircraft
• $3,000/hr
• Balance between commercial, • 70 hr/mo
financial and operational • 2 Midsize Aircraft:
parameters • $4mm/aircraft
• $4,500/hr
• Main parameters • 70 hr/mo
• Acquisition Price • 1 ‘Supermid’ Aircraft
• Market Demand (hr/month) • $6mm/aircraft
• Market Flight Price ($/hr) • $7,000/hr
• Maintenance Cost ($/hr) • 70 hr/mo
“How” – Execution: Charter Operation
Unleveraged Scenario
• The numbers presented have been calculated based on a minimum
of 70 hours flight per month for 01 aircraft, which is the number of
hours the charter company is willing to guarantee.
• The results demonstrated on the sheet below were calculated base
on an initial equity investment of $4mm and its return after 36
months of charter operation.
• The scenario assumes zero leverage and a conservative 25%
depreciation on one $4mm aircraft over 03 years.
From Aircraft Charter
Operation From Aircraft
Sale
“How” – Execution: Charter Operation
Leveraged Scenario
• The numbers presented have been calculated based on a minimum of 70
hours flight per month for 02 aircraft, which is the number of hours the
charter company is willing to guarantee.
• The results demonstrated on the sheet below were calculated base on an
initial equity investment of $4mm and its return after 36 months of charter
operation.
• The scenario assumes $2mm leverage per aircraft and a conservative 25%
depreciation on two $4mm aircraft over 03 years.
Exit
Year # 1 Year # 2 Year #3
(Aircaft Sale)
Pretax Income 1,075,597.39 1,120,397.52 1,165,197.65 n/a
Cash Flow 1,075,597.39 1,120,397.52 1,165,197.65 4,800,008.00
ROI (yearly) 26.9% 28.0% 29.1% n/a
IRR 26.5%
From Aircraft Charter From Aircraft
Operation Sale
THANK YOU!
Corporate Office 1550 NW 62nd St. Hangar 18
3511 Silverside Rd, # 105 www.airtradeaviation.com Fort Lauderdale, FL 33309
Wilmington, DE 19810 - USA +1 (954) 271-7100
