Fortress Transportation and Infrastructure Investors LLC (NASDAQ:
FTAI) (the “Company” or “FTAI”) today reported financial results
for the first quarter 2022. The Company’s consolidated comparative
financial statements and key performance measures are attached as
an exhibit to this press release.
Financial Overview
(in thousands,
except per share data) |
Selected Financial
Results |
Q1’22 |
Net Cash Provided by Operating Activities |
$ |
1,923 |
|
Net Loss Attributable to
Shareholders |
$ |
(228,984 |
) |
Basic and Diluted Loss per
Common Share |
$ |
(2.30 |
) |
|
|
Funds Available for
Distribution (“FAD”) (1) |
$ |
71,386 |
|
Adjusted EBITDA(1) |
$ |
51,561 |
|
_______________________________(1) For
definitions and reconciliations of non-GAAP measures, please refer
to the exhibit to this press release.
For the first quarter of 2022, total FAD was
$71.4 million. This amount includes $117.1 million from our
aviation leasing portfolio and $7.1 million from our infrastructure
business, offset by $(52.8) million from corporate and other.
First Quarter 2022
Dividends
On April 28, 2022, the Company’s Board of
Directors (the “Board”) declared a cash dividend on its common
shares of $0.33 per share for the quarter ended March 31, 2022,
payable on May 24, 2022 to the holders of record on May 13,
2022.
Additionally, on April 28, 2022, the Board
declared cash dividends on its Fixed-to-Floating Rate Series A
Cumulative Perpetual Redeemable Preferred Shares (“Series A
Preferred Shares”), Fixed-to-Floating Rate Series B Cumulative
Perpetual Redeemable Preferred Shares (“Series B Preferred Shares”)
and Fixed Rate Reset Series C Cumulative Perpetual Redeemable
Preferred Shares (“Series C Preferred Shares”) of $0.51563,
$0.50000 and $0.51563 per share, respectively, for the quarter
ended March 31, 2022, payable on June 15, 2022 to the holders of
record on June 1, 2022.
Business Highlights
- FTAI’s
Board of Directors has unanimously approved the previously
announced spin-off of FTAI’s subsidiary FTAI Infrastructure.
- FTAI
Infrastructure expects to file its Form 10 publicly with the SEC on
or before April 29, 2022 and targets completion of the spin-off of
FTAI Infrastructure in the next 4 to 8 weeks subject to, among
other things, the Board declaring the distribution prior to the
closing of the spin-off.
- Since
inception of The Module Factory operations in June of 2021, FTAI
Aviation has completed or contracted for sale over 200 module sales
or swaps with over 20 new customers.
- FTAI
wrote off $195mm for impairments, bad debt and lost revenue for the
Russia/Ukraine war and currently expects to recapture such amounts
in full from insurance proceeds, gains from asset sales, and
receivable repayments.
-
Jefferson recorded its highest throughput at 107,642 barrels per
day, up from 81,416 barrels per day in Q4 of 2021.
- Long
Ridge formally commissioned the blending of hydrogen into the power
plant at a ceremony on April 22, 2022.
Additional Information
For additional information that management
believes to be useful for investors, please refer to the
presentation posted on the Investor Relations section of the
Company’s website, www.ftandi.com, and the Company’s Quarterly
Report on Form 10-Q, when available on the Company’s website.
Nothing on the Company’s website is included or incorporated by
reference herein.
Conference Call
The Company will host a conference call on
Friday, April 29, 2022 at 8:00 A.M. Eastern Time. The conference
call may be accessed by dialing (877) 447-5636 (from within the
U.S.) or (615) 247-0080 (from outside of the U.S.) ten minutes
prior to the scheduled start of the call; please reference "FTAI
First Quarter 2022 Earnings Call." A simultaneous webcast of the
conference call will be available to the public on a listen-only
basis at www.ftandi.com.
A replay of the conference call will be
available after 11:30 A.M. on Friday, April 29, 2022 through 11:30
A.M. Friday, May 6, 2022 at (855) 859-2056 (from within the U.S.)
or (404) 537-3406 (from outside of the U.S.), Passcode:
7790834.
About Fortress Transportation and
Infrastructure Investors LLC
Fortress Transportation and Infrastructure
Investors LLC owns and acquires high quality infrastructure and
equipment that is essential for the transportation of goods and
people globally. FTAI targets assets that, on a combined basis,
generate strong and stable cash flows with the potential for
earnings growth and asset appreciation. FTAI is externally managed
by an affiliate of Fortress Investment Group LLC, a leading,
diversified global investment firm.
Cautionary Note Regarding
Forward-Looking Statements
Certain statements in this press release may
constitute forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including, but
not limited to, the Company’s ability to file the FTAI
Infrastructure Form 10 by April 29, 2022 or at all, to successfully
complete the spin-off of FTAI Infrastructure in the next 4 to 8
weeks or at all, for The Module Factory to close or complete any
contracts for sales or swaps, and the ability to recover $195 mm in
impairments, bad debt and lost revenue in connection with the
Russia/Ukraine war in full or at all. These statements are based on
management's current expectations and beliefs and are subject to a
number of trends and uncertainties that could cause actual results
to differ materially from those described in the forward-looking
statements, many of which are beyond the Company’s control. The
Company can give no assurance that its expectations will be
attained and such differences may be material. Accordingly, you
should not place undue reliance on any forward-looking statements
contained in this press release. For a discussion of some of the
risks and important factors that could affect such forward-looking
statements, see the sections entitled “Risk Factors” and
“Management’s Discussion and Analysis of Financial Condition and
Results of Operations” in the Company’s most recent Annual Report
on Form 10-K and Quarterly Reports on Form 10-Q, which are
available on the Company’s website (www.ftandi.com). In addition,
new risks and uncertainties emerge from time to time, and it is not
possible for the Company to predict or assess the impact of every
factor that may cause its actual results to differ from those
contained in any forward-looking statements. Such forward-looking
statements speak only as of the date of this press release. The
Company expressly disclaims any obligation to release publicly any
updates or revisions to any forward-looking statements contained
herein to reflect any change in the Company's expectations with
regard thereto or change in events, conditions or circumstances on
which any statement is based. This release shall not constitute an
offer to sell or the solicitation of an offer to buy any
securities.
For further information, please
contact:
Alan AndreiniInvestor RelationsFortress
Transportation and Infrastructure Investors LLC(212)
798-6128aandreini@fortress.com
Withholding Information for Withholding
Agents
This announcement is intended to be a qualified
notice as provided in the Internal Revenue Code (the “Code”) and
the Regulations thereunder. For U.S. federal income tax purposes,
the common dividend and the Series A Preferred, Series B Preferred
and Series C Preferred dividends declared in April 2022 will be
treated as a partnership distribution and guaranteed payments,
respectively. For U.S. tax withholding purposes, the per share
distribution components are as follows:
Common Distribution Components |
|
Non-U.S. Long Term Capital Gain |
$ |
— |
|
U.S. Portfolio Interest
Income(1) |
$ |
0.00605 |
|
U.S. Dividend Income(2) |
$ |
0.14619 |
|
Income Not from U.S.
Sources(3) |
$ |
0.17776 |
|
U.S. Long Term Capital
Gain(4) |
$ |
— |
|
Distribution Per Share |
$ |
0.33000 |
|
Series A Preferred Distribution Components |
|
Guaranteed Payments(5) |
$ |
0.51563 |
|
Distribution Per Share |
$ |
0.51563 |
|
Series B Preferred Distribution Components |
|
Guaranteed Payments(5) |
$ |
0.50000 |
|
Distribution Per Share |
$ |
0.50000 |
|
Series C Preferred Distribution Components |
|
Guaranteed Payments(5) |
$ |
0.51563 |
|
Distribution Per Share |
$ |
0.51563 |
|
(1) Eligible for the U.S. portfolio
interest exemption for any holder not considered a 10-percent
shareholder under §871(h)(3)(B) of the Code.
(2) This income is subject to withholding under
§1441 or §1442 of the Code.
(3) This income is not subject to withholding
under §1441, §1442 or §1446 of the Code.
(4) U.S. Long Term Capital Gain attributable to
the sale of a U.S. Real Property Holding Corporation. As a result,
the gain will be treated as income that is effectively connected
with a U.S. trade or business and be subject to withholding.
(5) Brokers and nominees should treat this
income as subject to withholding under §1441 or §1442 of the
Code.
For U.S. shareholders: In
computing your U.S. federal taxable income, you should not rely on
this qualified notice, but should generally take into account your
allocable share of the Company’s taxable income as reported to you
on your Schedule K-1
Exhibit - Financial Statements
FORTRESS TRANSPORTATION AND
INFRASTRUCTURE INVESTORS LLCCONSOLIDATED
STATEMENTS OF OPERATIONS (Unaudited)(Dollar amounts in
thousands, except per share data)
|
Three Months Ended March 31, |
|
|
2022 |
|
|
|
2021 |
|
Revenues |
|
|
|
Equipment leasing
revenues |
$ |
91,691 |
|
|
$ |
56,607 |
|
Infrastructure revenues |
|
46,148 |
|
|
|
20,542 |
|
Total revenues |
|
137,839 |
|
|
|
77,149 |
|
Expenses |
|
|
|
Operating expenses |
|
108,916 |
|
|
|
24,997 |
|
General and
administrative |
|
5,691 |
|
|
|
4,252 |
|
Acquisition and transaction
expenses |
|
6,024 |
|
|
|
1,643 |
|
Management fees and incentive
allocation to affiliate |
|
4,164 |
|
|
|
3,990 |
|
Depreciation and
amortization |
|
58,301 |
|
|
|
44,535 |
|
Asset impairment |
|
122,790 |
|
|
|
2,100 |
|
Interest expense |
|
50,598 |
|
|
|
32,990 |
|
Total expenses |
|
356,484 |
|
|
|
114,507 |
|
Other income
(expense) |
|
|
|
Equity in (losses) earnings of
unconsolidated entities |
|
(24,013 |
) |
|
|
1,374 |
|
Gain on sale of assets,
net |
|
16,288 |
|
|
|
811 |
|
Interest income |
|
656 |
|
|
|
285 |
|
Other (expense) income |
|
(459 |
) |
|
|
181 |
|
Total other (expense)
income |
|
(7,528 |
) |
|
|
2,651 |
|
Loss before income
taxes |
|
(226,173 |
) |
|
|
(34,707 |
) |
Provision for income
taxes |
|
3,486 |
|
|
|
169 |
|
Net loss |
|
(229,659 |
) |
|
|
(34,876 |
) |
Less: Net loss attributable to
non-controlling interests in consolidated subsidiaries |
|
(7,466 |
) |
|
|
(4,961 |
) |
Less: Dividends on preferred
shares |
|
6,791 |
|
|
|
4,625 |
|
Net loss attributable
to shareholders |
$ |
(228,984 |
) |
|
$ |
(34,540 |
) |
|
|
|
|
Loss per
share: |
|
|
|
Basic |
$ |
(2.30 |
) |
|
$ |
(0.40 |
) |
Diluted |
$ |
(2.30 |
) |
|
$ |
(0.40 |
) |
Weighted average
shares outstanding: |
|
|
|
Basic |
|
99,366,877 |
|
|
|
86,027,944 |
|
Diluted |
|
99,366,877 |
|
|
|
86,027,944 |
|
FORTRESS TRANSPORTATION AND
INFRASTRUCTURE INVESTORS LLCCONSOLIDATED BALANCE
SHEETS (Unaudited)(Dollar amounts in thousands, except per
share data)
|
(Unaudited) |
|
|
|
March 31, 2022 |
|
December 31, 2021 |
Assets |
|
|
|
Cash and cash equivalents |
$ |
145,266 |
|
|
$ |
188,078 |
|
Restricted cash |
|
214,401 |
|
|
|
251,983 |
|
Accounts receivable, net |
|
105,113 |
|
|
|
175,225 |
|
Leasing equipment, net |
|
1,901,960 |
|
|
|
1,891,649 |
|
Operating lease right-of-use
assets, net |
|
74,513 |
|
|
|
75,344 |
|
Property, plant, and
equipment, net |
|
1,587,291 |
|
|
|
1,555,857 |
|
Investments |
|
78,498 |
|
|
|
77,325 |
|
Intangible assets, net |
|
101,464 |
|
|
|
98,699 |
|
Goodwill |
|
257,968 |
|
|
|
257,137 |
|
Other assets |
|
292,023 |
|
|
|
292,557 |
|
Total assets |
$ |
4,758,497 |
|
|
$ |
4,863,854 |
|
|
|
|
|
Liabilities |
|
|
|
Accounts payable and accrued
liabilities |
$ |
191,131 |
|
|
$ |
202,669 |
|
Debt, net |
|
3,399,367 |
|
|
|
3,220,211 |
|
Maintenance deposits |
|
74,322 |
|
|
|
106,836 |
|
Security deposits |
|
31,003 |
|
|
|
40,149 |
|
Operating lease
liabilities |
|
73,005 |
|
|
|
73,594 |
|
Other liabilities |
|
228,674 |
|
|
|
96,295 |
|
Total liabilities |
$ |
3,997,502 |
|
|
$ |
3,739,754 |
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
Equity |
|
|
|
Common shares ($0.01 par value
per share; 2,000,000,000 shares authorized; 99,188,696 and
99,180,385 shares issued and outstanding as of March 31, 2022
and December 31, 2021, respectively) |
$ |
992 |
|
|
$ |
992 |
|
Preferred shares ($0.01 par
value per share; 200,000,000 shares authorized; 13,320,000 and
13,320,000 shares issued and outstanding as of March 31, 2022
and December 31, 2021, respectively) |
|
133 |
|
|
|
133 |
|
Additional paid in
capital |
|
1,372,564 |
|
|
|
1,411,940 |
|
Accumulated deficit |
|
(354,585 |
) |
|
|
(132,392 |
) |
Accumulated other
comprehensive loss |
|
(251,160 |
) |
|
|
(156,381 |
) |
Shareholders' equity |
|
767,944 |
|
|
|
1,124,292 |
|
Non-controlling interest in
equity of consolidated subsidiaries |
|
(6,949 |
) |
|
|
(192 |
) |
Total equity |
|
760,995 |
|
|
|
1,124,100 |
|
Total liabilities and
equity |
$ |
4,758,497 |
|
|
$ |
4,863,854 |
|
FORTRESS TRANSPORTATION AND
INFRASTRUCTURE INVESTORS LLCCONSOLIDATED
STATEMENTS OF CASH FLOWS (Unaudited)(Dollar amounts in
thousands, unless otherwise noted)
|
Three Months Ended March 31, |
|
|
2022 |
|
|
|
2021 |
|
Cash flows from
operating activities: |
|
|
|
Net loss |
$ |
(229,659 |
) |
|
$ |
(34,876 |
) |
Adjustments to reconcile net
loss to net cash (used in) provided by operating activities: |
|
|
|
Equity in losses (earnings) of
unconsolidated entities |
|
24,013 |
|
|
|
(1,374 |
) |
Loss on sale of assets,
net |
|
(16,288 |
) |
|
|
(811 |
) |
Security deposits and
maintenance claims included in earnings |
|
(11,592 |
) |
|
|
(2,836 |
) |
Equity-based compensation |
|
709 |
|
|
|
1,114 |
|
Depreciation and
amortization |
|
58,301 |
|
|
|
44,535 |
|
Asset impairment |
|
122,790 |
|
|
|
2,100 |
|
Change in deferred income
taxes |
|
2,388 |
|
|
|
71 |
|
Change in fair value of
non-hedge derivative |
|
766 |
|
|
|
(7,964 |
) |
Amortization of lease
intangibles and incentives |
|
12,013 |
|
|
|
8,108 |
|
Amortization of deferred
financing costs |
|
5,771 |
|
|
|
2,268 |
|
Provision for (benefit from)
credit losses |
|
47,914 |
|
|
|
(547 |
) |
Other |
|
(208 |
) |
|
|
(279 |
) |
Change in: |
|
|
|
Accounts receivable |
|
8,619 |
|
|
|
(19,786 |
) |
Other assets |
|
(10,265 |
) |
|
|
(17,953 |
) |
Accounts payable and accrued liabilities |
|
(16,597 |
) |
|
|
(19,778 |
) |
Management fees payable to affiliate |
|
(158 |
) |
|
|
(602 |
) |
Other liabilities |
|
3,406 |
|
|
|
(322 |
) |
Net cash provided by
(used in) operating activities |
|
1,923 |
|
|
|
(48,932 |
) |
|
|
|
|
Cash flows from
investing activities: |
|
|
|
Investment in unconsolidated
entities |
|
(1,637 |
) |
|
|
(1,278 |
) |
Principal collections on
finance leases |
|
67 |
|
|
|
395 |
|
Acquisition of leasing
equipment |
|
(219,440 |
) |
|
|
(114,781 |
) |
Acquisition of property, plant
and equipment |
|
(54,661 |
) |
|
|
(39,302 |
) |
Acquisition of lease
intangibles |
|
(5,282 |
) |
|
|
(386 |
) |
Purchase deposits for
acquisitions |
|
(3,350 |
) |
|
|
(9,250 |
) |
Proceeds from sale of leasing
equipment |
|
51,491 |
|
|
|
4,574 |
|
Proceeds from sale of
property, plant and equipment |
|
2,910 |
|
|
|
— |
|
Proceeds for deposit on sale
of aircraft and engine |
|
1,775 |
|
|
|
— |
|
Receipt of deposits for sale
of aircraft and engine |
|
— |
|
|
|
4,600 |
|
Return of purchase
deposits |
|
— |
|
|
|
1,010 |
|
Net cash used in
investing activities |
$ |
(228,127 |
) |
|
$ |
(154,418 |
) |
FORTRESS TRANSPORTATION AND
INFRASTRUCTURE INVESTORS LLCCONSOLIDATED
STATEMENTS OF CASH FLOWS (Unaudited)(Dollar amounts in
thousands, unless otherwise noted)
|
Three Months Ended March 31, |
|
|
2022 |
|
|
|
2021 |
|
Cash flows from
financing activities: |
|
|
|
Proceeds from debt |
$ |
408,980 |
|
|
$ |
171,600 |
|
Repayment of debt |
|
(224,473 |
) |
|
|
— |
|
Payment of deferred financing
costs |
|
(10,818 |
) |
|
|
(563 |
) |
Receipt of security
deposits |
|
1,075 |
|
|
|
70 |
|
Return of security
deposits |
|
— |
|
|
|
(975 |
) |
Receipt of maintenance
deposits |
|
10,836 |
|
|
|
8,770 |
|
Release of maintenance
deposits |
|
(250 |
) |
|
|
(11,483 |
) |
Proceeds from issuance of
preferred shares, net of underwriter's discount and issuance
costs |
|
— |
|
|
|
101,180 |
|
Settlement of equity-based
compensation |
|
— |
|
|
|
(183 |
) |
Cash dividends - common
shares |
|
(32,749 |
) |
|
|
(28,383 |
) |
Cash dividends - preferred
shares |
|
(6,791 |
) |
|
|
(4,625 |
) |
Net cash provided by
financing activities |
$ |
145,810 |
|
|
$ |
235,408 |
|
|
|
|
|
Net (decrease)
increase in cash and cash equivalents and restricted
cash |
|
(80,394 |
) |
|
|
32,058 |
|
Cash and cash equivalents and
restricted cash, beginning of period |
|
440,061 |
|
|
|
161,418 |
|
Cash and cash
equivalents and restricted cash, end of period |
$ |
359,667 |
|
|
$ |
193,476 |
|
Key Performance Measures
The Chief Operating Decision Maker (“CODM”)
utilizes Adjusted EBITDA as our key performance measure.
Adjusted EBITDA provides the CODM with the
information necessary to assess operational performance, as well as
make resource and allocation decisions. Adjusted EBITDA is defined
as net income (loss) attributable to shareholders from continuing
operations, adjusted (a) to exclude the impact of provision for
income taxes, equity-based compensation expense, acquisition and
transaction expenses, losses on the modification or extinguishment
of debt and capital lease obligations, changes in fair value of
non-hedge derivative instruments, asset impairment charges,
incentive allocations, depreciation and amortization expense, and
interest expense, (b) to include the impact of our pro-rata share
of Adjusted EBITDA from unconsolidated entities, and (c) to exclude
the impact of equity in earnings (losses) of unconsolidated
entities and the non-controlling share of Adjusted EBITDA.
The following table sets forth a reconciliation
of net loss attributable to shareholders to Adjusted EBITDA for the
three months ended March 31, 2022 and 2021:
|
Three Months Ended March 31, |
(in thousands) |
|
2022 |
|
|
|
2021 |
|
Net loss attributable
to shareholders |
$ |
(228,984 |
) |
|
$ |
(34,540 |
) |
Add: Benefit from income
taxes |
|
3,486 |
|
|
|
169 |
|
Add: Equity-based compensation
expense |
|
709 |
|
|
|
1,114 |
|
Add: Acquisition and
transaction expenses |
|
6,024 |
|
|
|
1,643 |
|
Add: Losses on the
modification or extinguishment of debt and capital lease
obligations |
|
— |
|
|
|
— |
|
Add: Changes in fair value of
non-hedge derivative instruments |
|
766 |
|
|
|
(7,964 |
) |
Add: Asset impairment
charges |
|
122,790 |
|
|
|
2,100 |
|
Add: Incentive
allocations |
|
— |
|
|
|
— |
|
Add: Depreciation and
amortization expense(1) |
|
70,314 |
|
|
|
52,643 |
|
Add: Interest expense |
|
50,598 |
|
|
|
32,990 |
|
Add: Pro-rata share of
Adjusted EBITDA from unconsolidated entities(2) |
|
5,661 |
|
|
|
2,402 |
|
Less: Equity in losses
(earnings) of unconsolidated entities |
|
24,013 |
|
|
|
(1,374 |
) |
Less: Non-controlling share of
Adjusted EBITDA(3) |
|
(3,816 |
) |
|
|
(2,029 |
) |
Adjusted EBITDA
(non-GAAP) |
$ |
51,561 |
|
|
$ |
47,154 |
|
__________________________________________________
(1) Includes the following items for the three
months ended March 31, 2022 and 2021: (i) depreciation and
amortization expense of $58,301 and $44,535, (ii) lease intangible
amortization of $3,658 and $752 and (iii) amortization for lease
incentives of $8,355 and $7,356, respectively.
(2) Includes the following items for the three
months ended March 31, 2022 and 2021: (i) net (loss) income of
$(21,890) and $1,180, (ii) interest expense of $6,463 and
$187, (iii) depreciation and amortization expense of $6,340
and $1,912, (iv) acquisition and transaction expenses of $3 and $0,
(v) changes in fair value of non-hedge derivative instruments of
$14,615 and $(877), (vi) equity-based compensation of $98 and $0
and (vii) asset impairment of $32 and $0, respectively.
(3) Includes the following items for the three
months ended March 31, 2022 and 2021: (i) equity-based compensation
of $127 and $198, (ii) provision for income taxes of $15 and $13,
(iii) interest expense of $1,384 and $281, (iv) depreciation and
amortization expense of $2,263 and $1,811 and (v) changes in fair
value of non-hedge derivative instruments of $27 and $(274),
respectively.
The Company uses Funds Available for
Distribution (“FAD”) in evaluating its ability to meet its stated
dividend policy. FAD is not a financial measure in accordance with
GAAP. The GAAP measure most directly comparable to FAD is net cash
provided by operating activities. The Company believes FAD is a
useful metric for investors and analysts for similar purposes.
The Company defines FAD as: Net Cash Provided by
Operating Activities plus principal collections on finance leases,
proceeds from sale of assets, and return of capital distributions
from unconsolidated entities, less required payments on debt
obligations and capital distributions to non-controlling interest,
and excluding changes in working capital.
The following table sets forth a reconciliation
of Net Cash Provided by (Used in) Operating Activities to FAD for
the three months ended March 31, 2022 and 2021:
|
Three Months Ended March 31, |
(in thousands) |
|
2022 |
|
|
|
2021 |
|
Net Cash Provided by
(Used in) Operating Activities |
$ |
1,923 |
|
|
$ |
(48,932 |
) |
Add: Principal Collections on
Finance Leases |
|
67 |
|
|
|
395 |
|
Add: Proceeds from Sale of
Assets |
|
54,401 |
|
|
|
4,574 |
|
Add: Return of Capital
Distributions from Unconsolidated Entities |
|
— |
|
|
|
— |
|
Less: Required Payments on
Debt Obligations(1) |
|
— |
|
|
|
— |
|
Less: Capital Distributions to
Non-Controlling Interest |
|
— |
|
|
|
— |
|
Exclude: Changes in Working
Capital |
|
14,995 |
|
|
|
58,441 |
|
Funds Available for
Distribution (FAD) |
$ |
71,386 |
|
|
$ |
14,478 |
|
________________________________________________________
(1) Required payments on debt obligations for
the three months ended March 31, 2022 exclude repayments of
$224,473 for the Revolving Credit Facility.
The following table sets forth a reconciliation
of FAD to Net Cash Provided by Operating Activities for the three
months ended March 31, 2022:
|
Three Months Ended March 31, 2022 |
(in thousands) |
Equipment Leasing |
|
Infrastructure |
|
Corporate and Other |
|
Total |
Funds Available for Distribution (FAD) |
$ |
117,080 |
|
|
$ |
7,119 |
|
|
$ |
(52,813 |
) |
|
$ |
71,386 |
|
Less: Principal Collections on Finance Leases |
|
|
|
|
|
|
(67 |
) |
Less: Proceeds from Sale of Assets |
|
|
|
|
|
|
(54,401 |
) |
Less: Return of Capital Distributions from Unconsolidated
Entities |
|
|
|
|
|
|
— |
|
Add: Required Payments on Debt Obligations |
|
|
|
|
|
|
— |
|
Add: Capital Distributions to Non-Controlling Interest |
|
|
|
|
|
|
— |
|
Include: Changes in Working Capital |
|
|
|
|
|
|
(14,995 |
) |
Net Cash Provided by
Operating Activities |
|
|
|
|
|
|
$ |
1,923 |
|
FAD is subject to a number of limitations and
assumptions and there can be no assurance that the Company will
generate FAD sufficient to meet its intended dividends. FAD has
material limitations as a liquidity measure of the Company because
such measure excludes items that are required elements of the
Company’s net cash provided by operating activities as described
below. FAD should not be considered in isolation nor as a
substitute for analysis of the Company’s results of operations
under GAAP, and it is not the only metric that should be considered
in evaluating the Company’s ability to meet its stated dividend
policy. Specifically:
- FAD does not
include equity capital called from the Company’s existing limited
partners, proceeds from any debt issuance or future equity
offering, historical cash and cash equivalents and expected
investments in the Company’s operations.
- FAD does not give pro forma effect to
prior acquisitions, certain of which cannot be quantified.
- While FAD reflects
the cash inflows from sale of certain assets, FAD does not reflect
the cash outflows to acquire assets as the Company relies on
alternative sources of liquidity to fund such purchases.
- FAD does not
reflect expenditures related to capital expenditures, acquisitions
and other investments as the Company has multiple sources of
liquidity and intends to fund these expenditures with future
incurrences of indebtedness, additional capital contributions
and/or future issuances of equity.
- FAD does not
reflect any maintenance capital expenditures necessary to maintain
the same level of cash generation from our capital
investments.
- FAD does not
reflect changes in working capital balances as management believes
that changes in working capital are primarily driven by short term
timing differences, which are not meaningful to the Company’s
distribution decisions.
- Management has
significant discretion to make distributions, and the Company is
not bound by any contractual provision that requires it to use cash
for distributions.
If such factors were included in FAD, there can
be no assurance that the results would be consistent with the
Company’s presentation of FAD.
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