Aircraft lessor Aircastle has reached new agreements to place seven Boeing 737-700s previously operated by Sterling Airlines prior to the carrier ceasing operations late last year.

Iceland's economic crisis forced Sterling to cease operations in October 2008. The carrier's controlling shareholder was Icelandic.

During a call today to discuss the company's first quarter $18.5 million profit, Aircastle CEO Ron Wainshal said the company has placed all seven aircraft. Three of the 737s began operating during the first quarter and four are scheduled to be placed into revenue service by the end of May.

"When you get aircraft back at the wrong time of the year and have no time to prepare you're going to do worse," says Wainshal. But he adds, "I'm actually very pleased with the execution of the Sterling aircraft. We hit all our internal bogeys on that."

Aircastle's overall revenues for the first quarter fell by $2.8 million to $132 million and lease rental fell by $5 million to $126 million. The company explains the fall in lease revenue is attributable to $7.7 million of revenue downtime in connection with aircraft in transition and freighter conversions.

Highlighting the financial support currently being offered by the US ExIm bank and European export credit agencies, Wainshal says he believes the latter will play a role in financing Aircastle's A330s.

The company has 12 A330s on order after amending its deal with Airbus in late 2008 to drop its original order from 15 to 12, and change the mix of the order to include more freighters.

Shortly the deal was amended Wainshal said Aircastle had reached a deal with a Chinese carrier to operate three of four A330s scheduled for delivery in 2010.

Source: Air Transport Intelligence news