GECAS swallows $190m in impairment charges in Q3

London
Source: Flightglobal.com
This story is sourced from Flightglobal.com

Operating lessor GECAS incurred $190 million in impairment charges in the third quarter, driven by valuations on its cargo aircraft, and "specifically" the Boeing MD11 freighter fleet.

"The impairments were $55 million higher in 2013," said Jeff Bornstein, senior vice-president and chief financial officer of General Electric on an earnings call today.

GECAS has 10 MD-11 aircraft remaining in the fleet with a value of $150 million, says Bornstein.

The lessor had no aircraft on the ground at the end of the quarter.

The charges, which are part of the lessor's annual impairment review, helped push down net profits by 31% in the quarter, along with lower assets, to $173 million, compared with the year-earlier period.

Total revenues inched up to $1.3 billion at the lessor, a unit of GE Capital, from $1.2 billion in the third quarter of 2012, says GE in an earnings release.

GE reported net earnings of $3.2 billion, a decrease of 9% from the year-ago period.

GE Capital continues to decrease the size of its portfolio, while focusing on its core businesses, says GE.