Air management

AIR LEASE CORP MANAGEMENT REPORT OF FINANCIAL POSITION AND RESULTS OF OPERATIONS (Form 10-Q)

The following discussion and analysis of our financial condition and results of
operations should be read together with our Consolidated Financial Statements
and related notes included in Part I, Item 1 of this Quarterly Report on
Form 10-Q.

Insight

Air Lease Corporation (the "Company", "ALC", "we", "our" or "us") is a leading
aircraft leasing company that was founded by aircraft leasing industry pioneer,
Steven F. Udvar-Házy. We are principally engaged in purchasing the most modern,
fuel-efficient new technology commercial jet aircraft directly from aircraft
manufacturers, such as The Boeing Company ("Boeing") and Airbus S.A.S.
("Airbus"), and leasing those aircraft to airlines throughout the world with the
intention to generate attractive returns on equity. In addition to our leasing
activities, we sell aircraft from our fleet to third-parties, including other
leasing companies, financial services companies, airlines and other investors.
We also provide fleet management services to investors and owners of aircraft
portfolios for a management fee. Our operating performance is driven by the
growth of our fleet, the terms of our leases, the interest rates on our debt,
and the aggregate amount of our indebtedness, supplemented by gains from
aircraft sales and our management fees.

First Quarter Overview

As of March 31, 2022, the net book value of our fleet was $22.3 billion,
compared to $22.9 billion as of December 31, 2021. During the three months ended
March 31, 2022, we purchased and took delivery of eight aircraft from our new
order pipeline, one aircraft from the secondary market and wrote-off the net
book value of 21 aircraft that remain in Russia, ending the period with a total
of 370 aircraft in our owned aircraft portfolio. The weighted average age of our
fleet was 4.5 years and the weighted average lease term remaining was 7.0 years
as of March 31, 2022. Our managed fleet was 87 aircraft as of March 31, 2022 as
compared to a managed fleet of 92 aircraft as of December 31, 2021. We have a
globally diversified customer base comprised of 114 airlines in 60 countries as
of March 31, 2022. As of May 5, 2022, all aircraft in our fleet, except for
three aircraft, were subject to lease agreements or letters of intent.

During the quarter ended March 31, 2022, we increased our committed orderbook by
entering into agreements with Boeing to purchase 50 aircraft, which includes the
conversion of three 787-9 aircraft to 18 737 MAX aircraft. In addition, we
canceled five aircraft in our orderbook that were slated for delivery in Russia.
As of March 31, 2022, we had commitments to purchase 451 aircraft from Boeing
and Airbus for delivery through 2028, with an estimated aggregate commitment of
$28.8 billion.

We have placed approximately 97% of our committed orderbook on long-term leases
for aircraft delivering through the end of 2023 and have placed 52% of our
entire orderbook. We ended the first quarter of 2022 with $29.5 billion in
committed minimum future rental payments, consisting of $14.1 billion in
contracted minimum rental payments on the aircraft in our existing fleet and
$15.4 billion in minimum future rental payments related to aircraft which will
deliver between 2022 through 2026.

We typically finance the purchase of aircraft and our business with available
cash balances, internally generated funds, including through aircraft sales,
preferred stock issuances, and debt financings. During the three months ended
March 31, 2022, we issued $750.0 million in aggregate principal amount of 2.20%
Medium-Term Notes due 2027, and $750.0 million in aggregate principal amount of
2.875% Medium-Term Notes due 2032. In addition, we ended the first quarter of
2022 with an aggregate borrowing capacity under our revolving credit facility of
$6.8 billion and total liquidity of $8.3 billion. As of March 31, 2022, we had
total debt outstanding of $18.0 billion, of which 95.1% was at a fixed rate and
99.2% was unsecured. As of March 31, 2022, our composite cost of funds raised
through debt financings was 2.77%.

Our total revenues for the quarter ended March 31, 2022 increased by 25.7% to
$596.7 million, compared to the quarter ended March 31, 2021. The increase in
total revenues was primarily driven by the continued growth in our fleet,
significantly lower cash basis and lease restructuring losses and the
recognition of approximately $59.6 million in security deposits and maintenance
reserve income resulting from the termination of our leasing activities in
Russia as required by government sanctions.

During the first quarter of 2022, the industry continued to recover from the
impact of COVID-19. As of March 31, 2022, we had $190.4 million in outstanding
deferred rentals due to the impact of the COVID-19 pandemic as compared to
$203.2 million as of December 31, 2021. Our collection rate and our lease
utilization rate for the three months ended March 31, 2022 were 96.9% and
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99.5%, respectively. Our collection rate is defined as the sum of cash collected
from lease rentals and maintenance reserves, including cash recovered from
outstanding receivables from previous periods, as a percentage of the total
contracted receivables due during the period and is calculated after giving
effect to lease deferral arrangements made as of March 31, 2022. The calculation
of our collection rate includes cash received and due from lease rentals and
maintenance reserves for the 21 aircraft previously included in our owned fleet
that remain in Russia through the date we terminated leasing activities. Lease
utilization rate is calculated based on the number of days each aircraft,
including the 21 aircraft previously included in our owned fleet that remain in
Russia as of March 31, 2022, was subject to a lease or letter of intent during
the period, weighted by the net book value of the aircraft.

During the three months ended March 31, 2022, we recorded a net loss
attributable to shareholders of $479.4 million, or $4.21 per diluted share, as
compared to net income attributable to shareholders of $80.2 million, or $0.70
per diluted share, in the prior period. Despite the continued growth of our
fleet, our net income attributable to shareholders decreased due to the
write-off of our interests in our owned and managed fleet that remain in Russia,
totaling approximately $802.4 million for the quarter ended March 31, 2022.

After excluding the effects of the write-off and certain other adjustments
described below, we recorded adjusted net income before income taxes for the
three months ended March 31, 2022 of $200.9 million or $1.76 per diluted share.
This increased by approximately 71.6% over the prior period results of $117.1
million or $1.03 per diluted share for the three months ended March 31, 2021.
This was due to the continued growth of our fleet and the increase in revenues
as discussed above. Adjusted net income before income taxes and adjusted diluted
earnings per share before income taxes are measures of financial and operational
performance that are not defined by U.S. Generally Accepted Accounting
Principles ("GAAP"). See "Results of Operations" below for a discussion of
adjusted net income before income taxes and adjusted diluted earnings per share
before income taxes as non-GAAP measures and a reconciliation of these measures
to net income attributable to common stockholders.

Impact of the Russian-Ukrainian conflict

In connection with the ongoing conflict between Russia and Ukraine, the United
States, European Union, United Kingdom and others have imposed, and may continue
to impose, economic sanctions and export controls against certain industry
sectors and parties in Russia. These sanctions include closures of airspace for
aircraft operated by Russian controlled entities, bans on the leasing or sale of
aircraft to Russian controlled entities, bans on the export and re-export of
aircraft and aircraft components to Russian controlled entities or for use in
Russia, and corresponding prohibitions on providing technical assistance,
brokering services, insurance and reinsurance, as well as financing or financial
assistance.

In response to the sanctions, in March 2022 we terminated all of our leasing
activities in Russia, consisting of 24 aircraft in our owned fleet, eight
aircraft in our managed fleet and the leasing activity relating to 29 aircraft
that have not yet delivered from our orderbook, for which many have been
subsequently placed. We also canceled five aircraft in our orderbook that were
slated for delivery in Russia. Prior to the Russia-Ukraine conflict, we did not
have any aircraft on lease in Belarus and had one aircraft on lease in Ukraine,
which is currently located outside of Ukraine. During the quarter, we recognized
approximately $59.6 million in security deposits and maintenance reserve income
resulting from the termination of our leasing activities in Russia. As of May 5,
2022, 21 aircraft previously included in our owned fleet and six aircraft
previously included in our managed fleet were not returned and remain in Russia.
Most of the operators of these aircraft have continued to fly the aircraft
notwithstanding the termination of leasing activities and our repeated demands
for the return of our assets. The 21 aircraft previously included in our owned
fleet represented 3.4% of our fleet by net book value as of March 31, 2022 and
provided approximately $18.0 million per quarter in rental revenue. In addition,
our future revenues and cash flows have been impacted by the termination of our
leasing activities of the aircraft in Russia, which we have reflected in the
table presented in Note 6 to our consolidated financial statements included in
this Quarterly Report on Form 10-Q.

While we maintain title to the aircraft, we determined that it is unlikely we
will regain possession of the aircraft that have not been returned and that
remain in Russia. As a result, we recorded a write-off of our interests in our
owned and managed aircraft that remain in Russia, totaling approximately $802.4
million for the quarter ended March 31, 2022. The 21 aircraft that remain in
Russia have been removed from our owned fleet count as of March 31, 2022. Our
lessees are primarily structured as triple net leases, whereby the lessee is
responsible for all operating costs, including insurance. We are vigorously
pursuing insurance claims to recover losses relating to our aircraft that remain
in Russia. Collection, timing and amounts of any insurance recoveries is
currently uncertain.

For more information regarding the risks we face relating to the Russia-Ukraine
conflict, see "Part II - Item 1A. Risk Factors," in this Quarterly Report on
Form 10-Q.
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Contents

Our fleet

References throughout this Quarterly Report on Form 10-Q to "our fleet" refer to
the aircraft included in flight equipment subject to operating leases and do not
include aircraft in our managed fleet or aircraft classified as net investments
in sales-type leases unless the context indicates otherwise. Portfolio metrics
of our fleet as of March 31, 2022 and December 31, 2021 are as follows:

                                                                     March 31, 2022                  December 31, 2021

Net book value of flight equipment subject to an operating lease $22.3 billion $22.9 billion Weighted average age of the fleet(1)

                                                     4.5 years                      4.4 years
Weighted-average remaining lease term(1)                                          7.0 years                      7.2 years

Owned fleet                                                                             370                            382
Managed fleet                                                                            87                             92
Aircraft on order                                                                       451                            431

Total                                                                                   908                            905

Current fleet contracted rentals                              $         14.1        billion       $         14.8   billion
Committed fleet rentals                                       $         15.4        billion       $         16.1   billion
Total committed rentals                                       $         29.5        billion       $         30.9   billion

(1) Weighted average age of the fleet and remaining term of the leases calculated on the basis of the net book value of our flight equipment subject to an operating lease.



The following table sets forth the net book value and percentage of the net book
value of our flight equipment subject to operating leases in the indicated
regions based on each airline's principal place of business as of March 31, 2022
and December 31, 2021:

                                                   March 31, 2022                                     December 31, 2021
                                        Net Book                                             Net Book
Region                                   Value                  % of Total                    Value                    % of Total
                                                                    (in thousands, except percentages)
Europe                              $   6,746,925                        30.2  %       $       7,439,993                        32.5  %
Asia (excluding China)                  6,109,545                        27.4  %               5,952,981                        26.0  %
China                                   2,902,867                        13.0  %               2,934,224                        12.8  %
The Middle East and Africa              2,422,660                        10.9  %               2,447,919                        10.7  %
U.S. and Canada                         1,596,215                         7.2  %               1,638,450                         7.2  %
Central America, South America, and
Mexico                                  1,596,112                         7.2  %               1,566,133                         6.8  %
Pacific, Australia, and New Zealand       909,988                         4.1  %                 919,304                         4.0  %
Total                               $  22,284,312                       100.0  %       $      22,899,004                       100.0  %



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Ta ble of Contents The following table shows the number of aircraft in our fleet owned by aircraft type as of March 31, 2022 and December 31, 2021:

                                March 31, 2022                     December 31, 2021
                           Number of                           Number of
Aircraft type              Aircraft         % of Total          Aircraft          % of Total
Airbus A319-100                     1            0.3  %                   1            0.3  %
Airbus A320-200                    28            7.5  %                  31            8.1  %
Airbus A320-200neo                 24            6.5  %                  23            6.0  %
Airbus A321-200                    24            6.5  %                  26            6.8  %
Airbus A321-200neo                 64           17.3  %                  69           18.1  %
Airbus A330-200                    13            3.4  %                  13            3.4  %
Airbus A330-300                     5            1.4  %                   8            2.1  %
Airbus A330-900neo                 10            2.7  %                   9            2.4  %
Airbus A350-900                    12            3.2  %                  12            3.1  %
Airbus A350-1000                    5            1.4  %                   5            1.3  %
Boeing 737-700                      4            1.1  %                   4            1.0  %
Boeing 737-800                     84           22.7  %                  88           23.0  %
Boeing 737-8 MAX                   30            8.1  %                  28            7.3  %
Boeing 737-9 MAX                    8            2.2  %                     7          1.8  %
Boeing 777-200ER                    1            0.3  %                   1            0.3  %
Boeing 777-300ER                   24            6.5  %                  24            6.3  %
Boeing 787-9                       26            7.0  %                  26            6.8  %
Boeing 787-10                       6            1.6  %                   6            1.6  %
Embraer E190                        1            0.3  %                   1            0.3  %
Total                             370          100.0  %                 382          100.0  %



As of March 31, 2022, we had contractual commitments to acquire a total of 451
new aircraft, with an estimated aggregate purchase price (including adjustments
for anticipated inflation) of $28.8 billion, for delivery through 2028 as
follows:
                                                                          Estimated Delivery Years
Aircraft Type                          2022             2023             2024             2025             2026            Thereafter             Total
Airbus A220-100/300                       4               17               23               20               12                  -                  76
Airbus A320/321neo(1)                    24               24               26               23               32                 64                 193
Airbus A330-900neo                        7                6                4                -                -                  -                  17
Airbus A350-900/1000                      3                3                3                -                -                  -                   9
Airbus A350F                              -                -                -                -                2                  5                   7
Boeing 737-8/9 MAX                       25               31               35               18               16                  -                 125
Boeing 787-9/10                           3                7                8                6                -                  -                  24
Total(2)                                 66               88               99               67               62                 69                 451

(1) Our Airbus A320/321neo orders include 27 long-haul variants and 49 extra long-haul variants. (2) The table above reflects delays in delivery of Airbus and Boeing aircraft based on contractual documentation.

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Aircraft Delivery Delays

Pursuant to our purchase agreements with Boeing and Airbus, we agree to
contractual delivery dates for each aircraft ordered. These dates can change for
a variety of reasons, however for the last several years, manufacturing delays
have significantly delayed the planned purchases of our aircraft on order with
Boeing and Airbus. We are currently experiencing delivery delays with both
Boeing and Airbus aircraft. However, the most significant delivery delays are
with our aircraft orders for Boeing 787 aircraft.

During 2020, Boeing began to experience manufacturing issues on its 787
aircraft, which resulted in significant aircraft delivery delays. Boeing has
halted 787 deliveries and has not indicated when they will resume. Accordingly,
we have not taken delivery of any 787s since the halting of the deliveries, and
the timing of deliveries of the aircraft for the remainder of this year and
potentially beyond remains uncertain.

Our leases typically provide that we and our airline customer each have a
cancellation right related to certain aircraft delivery delays. Our purchase
agreements with Boeing and Airbus also generally provide that we and the
manufacturer each have cancellation rights that typically parallel our
cancellation rights in our leases. Our leases and our purchase agreements with
Boeing and Airbus generally provide for cancellation rights starting at one year
after the original contractual delivery date, regardless of cause.

We believe that the majority of our 787 aircraft deliveries in our orderbook
will be delayed more than 12 months, which would give us, our airline customers
and Boeing the right to cancel these aircraft commitments. We are working with
Boeing and the respective airlines to find commercial solutions to prevent
cancellation rights from being exercised and ultimately, to take delivery of
these aircraft. However, as noted above, during the quarter ended March 31,
2022, we elected to cancel five aircraft in our orderbook that were slated for
delivery in Russia.

The following table, which is subject to change based on Airbus and Boeing
delivery delays, shows the number of new aircraft scheduled to be delivered as
of March 31, 2022, along with the lease placements of such aircraft as of May 5,
2022. As noted above, we expect delivery delays for all aircraft deliveries in
our orderbook. We remain in discussions with Boeing and Airbus to determine the
extent and duration of delivery delays, but we are not yet able to determine the
full impact of the delivery delays.

                   Number      Number of
Delivery Year      Leased      Aircraft       % Leased
2022                65            66            98.5  %
2023                85            88            96.6  %
2024                59            99            59.6  %
2025                25            67            37.3  %
2026                 2            62             3.2  %
Thereafter           -            69               -  %
Total              236           451


Aviation industry and sources of income

Our revenues are principally derived from operating leases with airlines
throughout the world. As of March 31, 2022, we had a globally diversified
customer base of 114 airlines in 60 different countries, with over 95% of our
business revenues from airlines domiciled outside of the U.S., and we anticipate
that most of our revenues in the future will be generated from foreign
customers.

Performance of the commercial airline industry is linked to global economic
health and development. Despite the disruption caused to the commercial airline
industry by the COVID-19 pandemic since early 2020, global air travel continues
to recover and has accelerated in a number of markets. The International Air
Transport Association ("IATA") reported that passenger traffic was up 76% in the
month of March 2022 relative to the same month in the prior year, as domestic
traffic continued to improve in most markets and the international traffic
recovery accelerated in markets where travel restrictions were relaxed. Domestic
markets have experienced faster recovery than international markets given
generally more relaxed travel restrictions. Global domestic passenger traffic in
March 2022 improved 12% relative to the prior year, and was 23% lower than the
same month in 2019. International traffic in March of 2022 rose 285% relative to
the prior year, though it remains 52% lower than the same month in 2019. We
believe COVID-19 vaccination
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progress, therapeutic treatments and the easing of travel restrictions will
continue to support the recovery of air passenger traffic and the commercial
airline industry.

As of March 31, 2022, approximately 74% of the net book value of our fleet are
leased to flag carriers or airlines that have some form of governmental
ownership; however, this does not guarantee our ability to collect contractual
rent payments. We believe that having a large portion of the net book value of
our fleet on lease with flag carriers or airlines with some form of governmental
ownership, coupled with the overall quality of our aircraft and security
deposits and maintenance reserves under our leases will help mitigate our
customer default risk.

Impacts from the COVID-19 pandemic, including border restrictions and other
travel limitations, initially reduced demand for certain aircraft in our fleet
resulting in weakened lease rates, most particularly on widebody aircraft.
However, starting in the second half of 2021, we experienced increased demand
for our aircraft. The overall increased demand, coupled with rising interest
rates and inflation, are providing catalysts for a rising lease rate environment
and we continue to see this in marketplace. Lease rates can be influenced by
several factors including impacts of epidemic diseases, changes in the
competitive landscape of the aircraft leasing industry, evolving international
trade matters, geopolitical events, and aircraft delivery delays and therefore,
are difficult to project or forecast.

As a result of continued manufacturing delays as discussed above in "Our Fleet,"
our aircraft delivery schedule could continue to be subject to material changes
and delivery delays could extend beyond 2022.

Global economic conditions are also impacting the aircraft leasing industry.
Fuel costs have increased significantly in 2022 compared to pandemic lows and
interest rates are also increasing. Our airline customers are also currently
experiencing wage negotiations and/or pilot shortages, which may increase their
operating costs. Also, as noted above, the Russia-Ukraine conflict has impacted
global macroeconomic conditions. While these events have not impacted our
lessees' ability to make lease payments to date, if our lessees are not able to
effectively manage increased operating costs, it could impact our financial
results and cash flows.

We believe the aircraft leasing industry has remained resilient over time across
a variety of global economic conditions and remain optimistic about the
long-term fundamentals of our business. We expect the aviation industry to
continue to recover from the impact of COVID-19. As a result of the COVID-19
pandemic, some airlines have accelerated their plans to retire older, less
fuel-efficient aircraft that have higher operating and maintenance costs in the
current environment. We anticipate that airlines will continue to accelerate the
retirement of these types of aircraft, particularly if fuel prices remain
elevated, ultimately increasing demand for newer aircraft over time. We also
anticipate that when airlines need to add new aircraft to their fleet, they will
increasingly elect to lease aircraft instead of purchasing aircraft to reduce
capital requirements and manage other operating expenses, and that we will
benefit from that trend. We expect a number of these trends to continue in 2022
and beyond.

Cash and capital resources

Insight

We ended the first quarter of 2022 with available liquidity of $8.3 billion
which is comprised of unrestricted cash of $1.5 billion and undrawn balances
under our unsecured revolving credit facility of $6.8 billion. We finance the
purchase of aircraft and our business operations using available cash balances,
internally generated funds, including through aircraft sales and trading
activity, and an array of financing products. We aim to maintain
investment-grade credit metrics and focus our debt financing strategy on funding
our business on an unsecured basis with primarily fixed-rate debt from public
bond offerings. Unsecured financing provides us with operational flexibility
when selling or transitioning aircraft from one airline to another. We also have
the ability to seek debt financing secured by our assets, as well as financings
supported through the Export-Import Bank of the United States and other export
credit agencies for future aircraft deliveries. We have also issued preferred
stock with a total aggregate stated value of $850.0 million. Our access to a
variety of financing alternatives including unsecured public bonds, private
capital, bank debt, secured financings and preferred stock issuances serves as a
key advantage in managing our liquidity. Aircraft delivery delays as a product
of manufacturer delays are expected to further reduce our aircraft investment
and debt financing needs for the next six to twelve months and potentially
beyond.

We have a balanced approach to capital allocation based on the following
priorities, ranked in order of importance: first, investing in modern, in-demand
aircraft to profitably grow our core aircraft leasing business while maintaining
strong fleet metrics and
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creating sustainable long-term shareholder value; second, maintaining our
investment grade balance sheet utilizing unsecured debt as our primary form of
financing; and finally, in lockstep with the aforementioned priorities,
returning excess cash to shareholders through our dividend policy as well as
regular evaluation of share repurchases, as appropriate.

We ended the first quarter of 2022 with total debt outstanding of $18.0 billion
compared to $17.2 billion as of December 31, 2021. Our unsecured debt
outstanding increased to $17.9 billion as of March 31, 2022 from $17.1 billion
as of December 31, 2021. Our unsecured debt as a percentage of total debt was
99.2% as of March 31, 2022 and December 31, 2021, respectively.

Significant cash sources and needs

We believe that we have sufficient liquidity from available cash balances, cash
generated from ongoing operations, available borrowings under our unsecured
revolving credit facility and general ability to access the capital markets for
opportunistic public bond offerings to satisfy the operating requirements of our
business through at least the next 12 months. Our long-term debt financing
strategy is focused on continuing to raise unsecured debt in the global bank and
investment grade capital markets. Our material cash sources include:

• Unrestricted cash: We ended the first quarter of 2022 with $1.5 billion in cash without restriction.

•Lease cash flows: We ended the first quarter of 2022 with $29.5 billion in
committed minimum future rental payments comprised of $14.1 billion in
contracted minimum rental payments on the aircraft in our existing fleet and
$15.4 billion in minimum future rental payments related to aircraft which will
deliver between 2022 through 2026. These rental payments are a primary driver of
our short and long-term operating-cash-flow. As of March 31, 2022, our minimum
future rentals on non-cancellable operating leases for the remainder of 2022 was
$1.5 billion. For further detail on our minimum future rentals for the remainder
of 2022 and thereafter, see "Notes to Consolidated Financial Statements" under
"Item 1. Financial Statements" in this Quarterly Report on Form 10-Q.

•Unsecured revolving credit facility: As of May 5, 2022, our $7.0 billion
revolving credit facility is syndicated across 52 financial institutions from
various regions of the world, diversifying our reliance on any individual
lending institution. The final maturity for the facility is May 2026, although
we expect to refinance this facility in advance of this date. The facility
contains standard investment grade covenants and does not condition our ability
to borrow on the lack of a material adverse effect to us or the general economy.

•Senior unsecured bonds: We are a frequent issuer in the investment grade
capital markets, opportunistically issuing unsecured bonds, primarily through
our Medium-Term Note Program at attractive cost of funds. In 2022, we have
issued $1.5 billion of Medium-Term Notes with a weighted average interest rate
of 2.54% and we expect to have continued access to the investment grade bond
market in the future.

•Aircraft sales: Proceeds from the sale of aircraft help supplement our
liquidity position. Although we have scaled back our aircraft sales activity in
recent years, assuming aircraft deliveries continue to improve, we are targeting
to sell approximately $750.0 million in aircraft for 2022. We did not sell any
aircraft in the first quarter of 2022.

•Other sources: In addition to the above, we generate liquidity through other
sources of debt financing (including unsecured and secured bank term loans),
issuances of preferred stock and cash received from security deposits and
maintenance reserves.

Our material cash requirements are primarily for the purchase of aircraft and
debt service payments, along with our general operating expenses. The amount of
our cash requirements depends on a variety of factors, including, the ability of
aircraft manufacturers to meet their contractual delivery obligations to us, the
ability of our lessees to meet their contractual obligations with us, the timing
of aircraft sales from our fleet, the timing and amount of our debt service
obligations, potential acquisitions, and the general economic environment in
which we operate.

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Our material cash requirements as of March 31, 2022, are as follows:
                                                   2022                 2023                 2024                 2025                 2026              Thereafter               Total
Long-term debt obligations                    $ 1,376,451          $ 

2,538,951 $2,894,628 $2,327,389 $3,472,845

       $  5,420,177          $ 18,030,441
Interest payments on debt
outstanding(1)                                    330,037              469,760              394,183              322,512              225,599               432,631             2,174,722
Purchase commitments(2)(3)                      4,446,438            6,049,551            6,400,067            4,006,352            3,491,754             4,450,903            28,845,065
Total                                         $ 6,152,926          $ 

9,058,262 $9,688,878 $6,656,253 $7,190,198

$10,303,711 $49,050,228

(1) Future interest payments on floating rate debt are estimated using floating rates in effect at March 31, 2022.
(2) Purchase commitments reflect future Boeing and Airbus aircraft deliveries based on information currently available to us based on contractual documentation. Purchase commitments
include only the costs of aircraft in our committed orderbook and do not include costs of aircraft that we have the right to purchase through memorandums of understanding or letters of
intent.
(3) Due to the expected aircraft delivery delays, we expect approximately $1.1 billion of our purchase commitments will be subject to cancellation, at our option, by the time of delivery.



The above table does not include any tax payments we may pay nor any dividends
we may pay on our preferred stock or common stock. Based on our expected cash
sources and requirements for the remainder of 2022, we expect that we will
continue to access the capital markets for public bond offerings in 2022 to meet
our cash requirements for aircraft deliveries and debt service obligations.

While we have planned our aircraft investments for the remainder of 2022 and
beyond based on currently expected delivery schedules, given the current
industry circumstances, our aircraft delivery schedule could continue to be
subject to material changes. In any case, our aircraft investments will be less
than what we planned prior to the pandemic, which will slow our revenue growth,
but will further improve our strong liquidity position.

The actual delivery dates of the aircraft in our commitments table and expected
time for payment of such aircraft may differ from our estimates and could be
further impacted by the pace at which Boeing and Airbus can deliver aircraft,
among other factors. We expect to make approximately $3.5 billion to $4.5
billion in aircraft investments in 2022, which reflects a high degree of
uncertainty around the Boeing 787 program as well as other potential production
delays.

As of March 31, 2022, we were in compliance in all material respects with the
covenants contained in our debt agreements. While a ratings downgrade would not
result in a default under any of our debt agreements, it could adversely affect
our ability to issue debt and obtain new financings, or renew existing
financings, and it would increase the costs of certain financings. Our liquidity
plans are subject to a number of risks and uncertainties, including those
described in our Annual Report on Form 10-K for the year ended December 31, 2021
and in this Quarterly Report.

Cash flow

Our cash flows provided by operating activities increased by 8.7% or $20.4
million, to $254.7 million for the three months ended March 31, 2022 as compared
to $234.3 million for the three months ended March 31, 2021. Our cash flow
provided by operating activities during the three months ended March 31, 2022
increased due to the continued growth of our fleet and an increase in our cash
collections as compared to the three months ended March 31, 2021. Our cash flow
used in investing activities was $620.6 million for the three months ended
March 31, 2022 and $549.7 million for the three months ended March 31, 2021,
which resulted primarily from the purchase of aircraft. Our cash flow provided
by financing activities was $769.6 million for the three months ended March 31,
2022, which resulted primarily from the issuance of senior unsecured notes,
which were used in part to acquire aircraft investments. Our cash flow used in
financing activities was $90.2 million for the three months ended March 31,
2021, which resulted primarily from the repayment of outstanding debt partially
offset by the issuance of unsecured notes and the issuance of our Series B
preferred stock in connection with acquiring aircraft investments.

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Debt

Our debt financing was comprised of the following at March 31, 2022 and
December 31, 2021:

                                                         March 31, 2022             December 31, 2021
                                                            ( in thousands, except percentages)
Unsecured
Senior notes                                         $        17,695,077           $      16,892,058
Term financings                                                  195,275                     167,000
    Total unsecured debt financing                            17,890,352   
              17,059,058
Secured
Term financings                                                  123,452                     126,660
Export credit financing                                           16,637                      18,301
    Total secured debt financing                                 140,089                     144,961

Total debt financing                                          18,030,441                  17,204,019
Less: Debt discounts and issuance costs                         (205,716)                   (181,539)

Debt financing, net of haircuts and issue costs $17,824,725

        $      17,022,480
Selected interest rates and ratios:
Composite interest rate(1)                                          2.77   %                    2.79  %
Composite interest rate on fixed-rate debt(1)                       2.85   %                    2.90  %
Percentage of total debt at a fixed-rate                            95.1   %                    94.8  %

(1) This rate does not include the effect of initial fees, facility fees, undrawn fees or the amortization of debt discounts and issue costs.

Senior unsecured notes (including medium term note program)

From March 31, 2022we have had $17.7 billion in senior unsecured notes outstanding. From December 31, 2021we have had $16.9 billion in senior unsecured notes outstanding.

During the three months ended March 31, 2022, we issued approximately
$1.5 billion in aggregate principal amount of senior unsecured notes comprised
of (i) $750.0 million in aggregate principal amount of 2.20% Medium-Term Notes
due 2027, and (ii) $750.0 million in aggregate principal amount of 2.875%
Medium-Term Notes due 2032.

For more information regarding our senior unsecured notes outstanding, see Note
2 of Notes to Consolidated Financial Statements included in Part III, Item 15 of
our Annual Report on Form 10-K for the year ended December 31, 2021.

Unsecured revolving credit facility

From March 31, 2022 and December 31, 2021we had no amounts outstanding under our unsecured revolving credit facility (the “Revolving Credit Facility”).

As of March 31, 2022, borrowings under the Revolving Credit Facility accrued
interest at LIBOR plus a margin of 1.05% per year. We are required to pay a
facility fee of 0.20% per year in respect of total commitments under the
Revolving Credit Facility. Interest rate and facility fees are subject to
increases or decreases based on declines or improvements in the credit ratings
for the Company's debt. Borrowings under the Revolving Credit Facility are used
to finance our working capital needs in the ordinary course of business and for
other general corporate purposes.

In April 2022, we amended and extended our Revolving Credit Facility through an
amendment that, among other things, extended the final maturity date from May 5,
2025 to May 5, 2026 and, after giving effect to $65.0 million in commitments
that
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matured on May 5, 2022, increased the total revolving commitments to
approximately $7.0 billion as of May 5, 2022. As of May 5, 2022, lenders held
revolving commitments totaling approximately $6.5 billion that mature on May 5,
2026, commitments totaling $132.5 million that mature on May 5, 2025 and
commitments totaling $400.0 million that mature on May 5, 2023. The amended
Revolving Credit Facility also replaced LIBOR with Term SOFR as the benchmark
interest rate and made certain conforming changes related thereto. As a result
of the amendment, borrowings under the amended Revolving Credit Facility accrue
interest at Adjusted Term SOFR (as defined in the Revolving Credit Facility) ,
plus a margin of 1.05% per year subject to increases or decreases based on
declines or improvements in the credit ratings for the Company's debt.

The Revolving Credit Facility provides for certain covenants, including
covenants that limit our subsidiaries' ability to incur, create, or assume
certain unsecured indebtedness in an aggregate amount over $100.0 million, and
our subsidiaries' abilities to engage in certain mergers, consolidations, and
asset sales. The Revolving Credit Facility also requires us to comply with
certain financial maintenance covenants including minimum consolidated
shareholders' equity, minimum consolidated unencumbered assets, and an interest
coverage test. In addition, the Revolving Credit Facility contains customary
events of default. In the case of an event of default, the lenders may terminate
the commitments under the Revolving Credit Facility and require immediate
repayment of all outstanding borrowings.

Other debt financing

From time to time, we enter into other debt financings such as unsecured term
financings and secured term financings, including export credit. As of March 31,
2022, the outstanding balance on other debt financings was $335.4 million and we
had pledged three aircraft as collateral with a net book value of $219.7
million. As of December 31, 2021, the outstanding balance on other debt
financings was $312.0 million and we had pledged three aircraft as collateral
with a net book value of $222.2 million.

Preferred shares

The following table summarizes our issued and outstanding preferred shares as of
March 31, 2022 (in thousands, except unit amounts and percentages):

                            Shares Issued and              Carrying Value                                   Dividend Rate in
                            Outstanding as of               as of March                                     Effect at March        Next dividend rate       Dividend rate after
                              March 31, 2022                  31, 2022               Issue Date                 31, 2022               reset date               reset date

Series A                      10,000,000                   $   250,000          March 5, 2019                       6.150  %       March 15, 2024           3M LIBOR plus 3.65%

                                                                                                                                                            5 Yr U.S. Treasury
Series B                         300,000                       300,000          March 2, 2021                       4.650  %       June 15, 2026            plus 4.076%

                                                                                                                                                            5 Yr U.S. Treasury
Series C                         300,000                       300,000          October 13, 2021                    4.125  %       December 15, 2026        plus 3.149%
Total Preferred Stock         10,600,000                   $   850,000



For more information regarding our preferred stock issued and outstanding, see
Note 4 of Notes to Consolidated Financial Statements included in Part III, Item
15 of our Annual Report on Form 10-K for the year ended December 31, 2021.

The following table summarizes the cash dividends that we paid during the three
months ended March 31, 2022 on our outstanding Series A, Series B and Series C
Preferred Stock:

                                      Payment Date
   Title of each class               March 15, 2022
                                     (in thousands)
Series A Preferred Stock                      $3,844
Series B Preferred Stock                      $3,487
Series C Preferred Stock                      $3,094



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Off­balance Sheet Arrangements

We have not established any unconsolidated entities for the purpose of
facilitating off-balance sheet arrangements or for other contractually narrow or
limited purposes. We have, however, from time to time established subsidiaries
or trusts for the purpose of leasing aircraft or facilitating borrowing
arrangements which are consolidated.

We have non-controlling interests in two investment funds in which we own 9.5%
of the equity of each fund. We account for our interest in these funds under the
equity method of accounting due to our level of influence and involvement in the
funds. Also, we manage aircraft that we have sold through our Thunderbolt
platform. In connection with the sale of these aircraft portfolios through our
Thunderbolt platform, we hold non-controlling interests of approximately 5.0% in
two entities. These investments are accounted for under the cost method of
accounting.

Impact of the LIBOR transition

On March 5, 2021, the Chief Executive of the U.K. Financial Conduct Authority,
which regulates LIBOR, publicly announced that no new contracts using U.S.
dollar LIBOR should be entered into after December 31, 2021, and that
publication of certain tenors of U.S. dollar LIBOR (including overnight and one,
three, six and 12 months) will permanently cease after June 30, 2023. In the
United States, efforts to identify a set of alternative U.S. dollar reference
interest rates are ongoing, and the Alternative Reference Rate Committee
("ARRC") has recommended the use of a Secured Overnight Funding Rate ("SOFR").
SOFR is different from LIBOR in that it is a backward-looking secured rate
rather than a forward-looking unsecured rate. For cash products and loans, the
ARRC has also recommended Term SOFR, which is a forward-looking SOFR based on
SOFR futures and may in part reduce differences between SOFR and LIBOR.

As of March 31, 2022, we had approximately $0.9 billion of floating rate debt
outstanding that used either one or three-month LIBOR as the applicable
reference rate to calculate the interest on such debt, of which $80.5 million is
set to mature after June 30, 2023. Additionally, our perpetual Series A
Preferred Stock is set to accrue dividends at a floating rate determined by
reference to three-month LIBOR, if available, beginning March 15, 2024. While
all of our agreements governing LIBOR-linked debt obligations and Series A
Preferred Stock obligations that are set to mature after June 30, 2023 contain
LIBOR transition fallback provisions, the lack of a standard market practice and
inconsistency in fallback provisions in recent years is reflected across the
agreements governing our floating rate debt and Series A Preferred Stock. For
our Series A Preferred Stock, if we determine there is no such alternative
reference rate, then we must select an independent financial advisor to
determine a substitute rate for LIBOR, and if an independent financial advisor
cannot determine an alternative reference rate, the dividend rate, business day
convention and manner of calculating dividends applicable during the fixed-rate
period of the Series A Preferred Stock will be in effect.

In April 2022, we amended and extended our Revolving Credit Facility through an
amendment that, among other things, replaced LIBOR with Term SOFR as the
benchmark interest rate. After that amendment, borrowings under the amended
Revolving Credit Facility accrue interest at Adjusted Term SOFR (as defined in
the Revolving Credit Facility), plus a margin of 1.05% per year subject to
increases or decreases based on declines or improvements in the credit ratings
for our debt.

The implementation of a substitute reference rate for the calculation of
interest rates under our LIBOR linked debt and Series A Preferred Stock
obligations may cause us to incur expenses in effecting the transition and may
result in disputes with our lenders or holders of Series A Preferred Stock over
the appropriateness or comparability to LIBOR of the substitute reference rate
selected. However, we do not expect the LIBOR transition impact will have a
material effect on our financial results based on our anticipated LIBOR linked
outstanding debt and Series A Preferred Stock at June 30, 2023.

If the rate used to calculate interest on our outstanding floating rate debt
that as of March 31, 2022, used LIBOR and our Series A Preferred Stock were to
increase by 1.0% either as a result of an increase in LIBOR or the result of the
use of an alternative reference rate determined under the fallback provisions in
the applicable debt agreement when LIBOR is discontinued, we would expect to
incur additional interest expense and preferred dividends of $8.9 million and
$2.5 million, respectively on such indebtedness and our Series A Preferred Stock
as of March 31, 2022 on an annualized basis.



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Credit Ratings

In March 2022, Kroll Bond Ratings reaffirmed our issuer and long-term debt ratings and raised our outlook from negative to stable. In April 2022, Standard and Poor’s confirmed our issuer and long-term debt ratings and outlook. Our superior long-term and corporate credit ratings help us lower our cost of funds and expand our access to capital at attractive prices. The following table summarizes our current credit ratings:

Rating Agency                               Long-term Debt                Corporate Rating                  Outlook                Date of Last Ratings Action
Kroll Bond Ratings                                A-                             A-                         Stable                                 March 25, 2022
Standard and Poor's                               BBB                            BBB                        Stable                                 April 21, 2022
Fitch Ratings                                     BBB                            BBB                        Stable                                   July 1, 2021



While a ratings downgrade would not result in a default under any of our debt
agreements, it could adversely affect our ability to issue debt and obtain new
financings, or renew existing financings, and it would increase the cost of our
financings.

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Results of Operations

The following table presents our historical operating results for the three
months ended March 31, 2022 and 2021 (in thousands, except per share amounts and
percentages):
                                                                               Three Months Ended
                                                                                    March 31,
                                                                            2022                2021
                                                                                  (unaudited)
Revenues
Rental of flight equipment                                              $  566,554          $ 468,095
Aircraft sales, trading and other                                           30,107              6,732
Total revenues                                                             596,661            474,827
Expenses
Interest                                                                   117,277            117,986
Amortization of debt discounts and issuance costs                           13,198             12,025
Interest expense                                                           130,475            130,011
Depreciation of flight equipment                                           235,308            208,965
Write-off of Russian fleet                                                 802,352                  -
Selling, general and administrative                                         32,762             26,914
Stock-based compensation                                                    (2,523)             5,408
Total expenses                                                           1,198,374            371,298
(Loss)/income before taxes                                                (601,713)           103,529
Income tax benefit/(expense)                                               132,720            (19,437)
Net (loss)/income                                                       $ (468,993)         $  84,092
Preferred stock dividends                                                  (10,425)            (3,844)
Net (loss)/income attributable to common stockholders                   $ 

(479,418) $80,248

(Loss)/earnings per share of common stock
Basic                                                                   $    (4.21)         $    0.70
Diluted                                                                 $    (4.21)         $    0.70

Other financial data
Pre-tax margin                                                              (100.8) %            21.8  %
Pre-tax return on common equity (trailing twelve months)                      (3.5) %             9.9  %
Adjusted net income before income taxes(1)                              $  200,889          $ 117,118
Adjusted diluted earnings per share before income taxes(1)              $     1.76          $    1.03
Adjusted pre-tax margin(1)                                                    33.7  %            24.7  %

Adjusted pre-tax return on common shares (trailing 12 months)(1)

                                                                    11.8  %            11.0  %


__________________________________________

(1)Adjusted net income before income taxes (defined as net income available to
common stockholders excluding the effects of certain non-cash items, one-time or
non-recurring items, such as write-offs of our Russian fleet, that are not
expected to continue in the future and certain other items), adjusted pre-tax
margin (defined as adjusted net income before income taxes divided by total
revenues), adjusted diluted earnings per share before income taxes (defined as
adjusted net income before income taxes divided by the weighted average diluted
common shares outstanding) and adjusted pre-tax return on common equity (defined
as adjusted net income before income taxes divided by average common
shareholders' equity) are measures of operating performance that are not defined
by GAAP and should not be considered as an alternative to net income available
to common stockholders, pre-tax margin, earnings per share, diluted earnings per
share and pre-tax return on common equity, or any other performance measures
derived in accordance with GAAP. Adjusted net income before income taxes,
adjusted pre-tax margin, adjusted diluted earnings per share before income taxes
and adjusted pre-tax return on common
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equity are presented as supplemental disclosure because management believes they
provide useful information on our earnings from ongoing operations.

Management and our board of directors use adjusted net income before income
taxes, adjusted pre-tax margin, adjusted diluted earnings per share before
income taxes and adjusted pre-tax return on common equity to assess our
consolidated financial and operating performance. Management believes these
measures are helpful in evaluating the operating performance of our ongoing
operations and identifying trends in our performance, because they remove the
effects of certain non-cash items, one-time or non-recurring items that are not
expected to continue in the future and certain other items from our operating
results. Adjusted net income before income taxes, adjusted pre-tax margin,
adjusted diluted earnings per share before income taxes and adjusted pre-tax
return on common equity, however, should not be considered in isolation or as a
substitute for analysis of our operating results or cash flows as reported under
GAAP. Adjusted net income before income taxes, adjusted pre-tax margin, adjusted
diluted earnings per share before income taxes and adjusted pre-tax return on
common equity do not reflect our cash expenditures or changes in our cash
requirements for our working capital needs. In addition, our calculation of
adjusted net income before income taxes, adjusted pre-tax margin, adjusted
diluted earnings per share before income taxes and adjusted pre-tax return on
common equity may differ from the adjusted net income before income taxes,
adjusted pre-tax margin, adjusted diluted earnings per share before income taxes
and adjusted pre-tax return on common equity, or analogous calculations of other
companies in our industry, limiting their usefulness as a comparative measure.

The following table presents the calculation of the adjusted pre-tax margin (in thousands, except percentages):

                                                                           Three Months Ended
                                                                                March 31,
                                                                      2022                        2021
                                                                               (unaudited)

Reconciliation of adjusted pre-tax margin numerator ((net loss)/income attributable to common shareholders to adjusted net income before income taxes): (net loss)/income attributable to common shareholders $

              (479,418)       $           80,248
Amortization of debt discounts and issuance costs                             13,198                   12,025
Write-off of Russian fleet                                                   802,352                        -
Stock-based compensation                                                     (2,523)                    5,408
Provision for income taxes                                                 (132,720)                   19,437
Adjusted net income before income taxes                     $               

$200,889,117,118

Denominator for adjusted pre-tax margin:
Total revenues                                              $                596,661       $          474,827
Adjusted pre-tax margin(a)                                                 33.7    %                 24.7   %

(a) Adjusted pre-tax margin is adjusted net profit before income taxes divided by total revenue

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The following table shows the calculation of adjusted diluted earnings per share
before income taxes (in thousands, except share and per share amounts):
                                                                        Three Months Ended
                                                                             March 31,
                                                                   2022                    2021
                                                                            (unaudited)

Reconciliation of the numerator of adjusted diluted earnings per share ((loss)/income attributable to common shareholders to Adjusted net income before income taxes): net (loss)/income attributable to common shareholders $(479,418) $80,248
Amortization of debt discounts and issue costs

                    13,198                  12,025
Write-off of Russian fleet                                          802,352                       -
Stock-based compensation                                             (2,523)                  5,408

Provision for income taxes                                         (132,720)                 19,437
Adjusted net income before income taxes                      $      200,889 

$117,118

Denominator of adjusted diluted earnings per share: Weighted average diluted common shares outstanding

              113,894,867             114,237,109

Potentially dilutive securities, the effect of which would have been anti-dilutive

                                                  249,781                       -

Adjusted weighted average diluted common shares outstanding 114,144,648

             114,237,109

Adjusted diluted earnings per share before income taxes(b) $1.76

$1.03

(b) Adjusted diluted earnings per share before income taxes is adjusted net income before income taxes divided by weighted average diluted ordinary shares outstanding

The following table shows the calculation of the adjusted pre-tax return on common equity (in thousands, except percentages):

                                                                        Trailing Twelve Months
                                                                               March 31,
                                                                    2022                       2021
                                                                              (unaudited)

Reconciliation of numerator of adjusted pre-tax return on common equity ((loss)/income attributable to common shareholders to Adjusted net earnings before income taxes): net (loss)/income attributable to common shareholders $(151,507) $

           447,830
Amortization of debt discounts and issuance costs                          51,793                    44,522
Write-off of Russian fleet                                                802,352                         -
Stock-based compensation                                                   18,585                    18,607

Provision for income taxes                                               (47,773)                   115,330
Adjusted net income before income taxes                     $             673,450       $           626,289

Denominator for adjusted pre-tax return on common equity:
Common shareholders' equity as of beginning of the period   $           5,878,212       $         5,486,369
Common shareholders' equity as of end of the period         $           5,519,585       $         5,878,212
Average common shareholders' equity                         $           

5,698,899 $5,682,291

Adjusted pre-tax return on common equity(c)                               11.8  %                 11.0    %

(c) Adjusted pre-tax return on common equity is calculated as adjusted net income before income taxes divided by average common shareholders’ equity

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Three months ended March 31, 2022, compared to the three months ended March 31,
2021

Rental revenue

During the three months ended March 31, 2022, we recorded $566.6 million in
rental revenue, which included overhaul revenue, net of amortization expense
related to initial direct costs of $39.7 million, as compared to $468.1 million,
which included amortization expense related to initial direct costs, net of
overhaul revenue of $2.4 million for the three months ended March 31, 2021. Our
owned fleet increased to 370 aircraft with a net book value of $22.3 billion as
of March 31, 2022 from 342 aircraft with a net book value of $20.8 billion as of
March 31, 2021. The increase in total revenues was primarily driven by the
growth in our fleet, significantly lower cash basis and lease restructuring
losses, and the recognition of approximately $41.7 million in end of lease
revenue resulting from the termination of our leasing activities in Russia.
Finally, during the three months ended March 31, 2022, our cash basis and lease
restructuring losses were $10.6 million in the aggregate, as compared to $85.7
million in the aggregate for the three months ended March 31, 2021.

Aircraft sales, trading and other income

Aircraft sales, trading and other revenue totaled $30.1 million for the three
months ended March 31, 2022 compared to $6.7 million for the three months ended
March 31, 2021. For the three months ended March 31, 2022, we recorded
$17.9 million in forfeiture of security deposit income from the termination of
our leasing activities in Russia. In addition, we recorded $4.4 million in gains
from three sales-type lease transactions during the first quarter of 2022. For
the three months ended March 31, 2021, we did not have any forfeiture of
security deposit income.

Interest expense

Interest expense totaled $130.5 million for the three months ended March 31,
2022 compared to $130.0 million for the three months ended March 31, 2021. Our
interest expense remained flat despite the increase in our average debt balance,
which was offset by a decline in our composite cost of funds. As we expect to
enter into a rising interest rate environment, accordingly, we expect our
interest expense will increase as our average debt balance outstanding and our
composite cost of funds increases in the future.

Depreciation expense

We recorded $235.3 million in depreciation expense of flight equipment for the
three months ended March 31, 2022 compared to $209.0 million for the three
months ended March 31, 2021. The increase in depreciation expense for the three
months ended March 31, 2022, compared to the three months ended March 31, 2021,
is primarily attributable to the growth of our fleet during the last twelve
months. We expect our depreciation expense to increase as we continue to add
aircraft to our fleet.

Write-off of Russian fleet

As further described above under "Impact of Russia-Ukraine Conflict", in
response to the sanctions against certain industry sectors and parties in
Russia, in March 2022 we terminated all of our leasing activities in Russia,
including 24 aircraft in our owned fleet and eight aircraft in our managed
fleet. As of May 5, 2022, 21 aircraft in our owned fleet and six aircraft in our
managed fleet remain in Russia. Most of the operators of these aircraft have
continued to fly the aircraft notwithstanding the termination of leasing
activities and our repeated demands for the return of our assets. While we
maintain title to the 21 aircraft, we determined that it is unlikely we will
regain possession of the aircraft that have not been returned and that remain in
Russia. As such, during the three months ended March 31, 2022, we recorded a
write-off of our interests in our owned and managed fleet that remain in Russia,
totaling approximately $802.4 million. We are vigorously pursuing insurance
claims to recover losses related to these aircraft. Collection, timing and
amounts of any insurance recoveries is currently uncertain; however, once we
determine that collectability is probable, we will record insurance recoveries
at that time. We did not record any asset write-offs during the three months
ended March 31, 2021.

Stock-based compensation

We recorded a net reversal of stock-based compensation expense of $2.5 million
for the three months ended March 31, 2022 compared to stock-based compensation
expense of $5.4 million for the three months ended March 31, 2021. The decrease
in stock-based compensation relates to reductions in the underlying vesting
estimates of certain book value RSUs as the performance criteria is no longer
being considered probable of being achieved.

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Selling, general and administrative expenses

We recorded selling, general and administrative expenses of $32.8 million for
the three months ended March 31, 2022 compared to $26.9 million for the three
months ended March 31, 2021. The increase in selling, general and administrative
expenses was primarily due to the increase in business activity and increased
expenses related to transition of aircraft. Selling, general and administrative
expense as a percentage of total revenue decreased to 5.5% for the three months
ended March 31, 2022 compared to 5.7% for the three months ended March 31, 2021.

Taxes

For the three months ended March 31, 2022 and March 31, 2021, we reported an
effective tax rate exclusive of any discrete items of 19.3% and 18.8%,
respectively. Due primarily to discrete items related to the write-off of our
Russian fleet, we reported an overall effective tax rate of 22.1% for the three
months ended March 31, 2022.

Net (loss)/income attributable to common shareholders

For the three months ended March 31, 2022, we reported consolidated net loss
attributable to common stockholders of $479.4 million, or loss of $4.21 per
diluted share, compared to a consolidated net income attributable to common
stockholders of $80.2 million, or $0.70 per diluted share, for the three months
ended March 31, 2021. Despite the growth of our fleet, our net income
attributable to common stockholders and diluted earnings per share decreased due
to the impact of the write-off of our Russian fleet.

Adjusted net profit before income taxes

For the three months ended March 31, 2022, we recorded adjusted net income
before income taxes of $200.9 million, or $1.76 per diluted share, compared to
an adjusted net income before income taxes of $117.1 million, or $1.03 per
diluted share, for the three months ended March 31, 2021. Our adjusted net
income before income taxes and adjusted diluted earnings per share before income
taxes increased for the three months ended March 31, 2022 as compared to 2021,
primarily due to the continued growth of our fleet and the increase in revenues
as discussed above.

Adjusted net income before income taxes and adjusted diluted earnings per share
before income taxes are measures of financial and operational performance that
are not defined by GAAP. See Note 1 under the "Results of Operations" table
above for a discussion of adjusted net income before income taxes and adjusted
diluted earnings per share before income taxes as non-GAAP measures and
reconciliation of these measures to net income available to common stockholders.

Critical accounting estimates

Our critical accounting estimates reflecting management's estimates and
judgments are described in our Annual Report on Form 10-K for the year ended
December 31, 2021. We have reviewed recently adopted accounting pronouncements
and determined that the adoption of such pronouncements is not expected to have
a material impact, if any, on our Consolidated Financial Statements.
Accordingly, there have been no material changes to critical accounting
estimates in the three months ended March 31, 2022.

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