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AerCap beats FY earnings target, sees aircraft lease rates growing

Illustration shows AerCap logo

DUBLIN (Reuters) - AerCap, the world's largest aircraft lessor, beat its full-year earnings target on Thursday and announced a $500 million share buyback as it forecast upward pressure on lease rates for the foreseeable future.

The Dublin-based lessor, which has a portfolio of 3,532 aircraft, engines and helicopters, reported adjusted earnings of $9.01 per share for 2022, well ahead of a November company forecast of $8-8.50. It said it expected to earn $7-7.50 per share in its current financial year.

The New York-listed shares of AerCap, the largest player in a leasing industry that buys more than half of Airbus and Boeing's passenger aircraft, opened 3.6% higher.

Chief Executive Officer Aengus Kelly said a combination of strong post-lockdown demand across the globe and significant delays by major aircraft manufacturers would push aircraft lease rates up for the foreseeable future.

"We believe that the issues affecting aircraft production are likely to persist for several years, resulting in strong demand and upward pressure on lease rates and values for the foreseeable future," Kelly told analysts in a conference call.

Passenger air traffic in Europe, Asia and the Americas are all running at over 80% of pre-pandemic levels, with China set to boost global demand further over the coming 18 months, he said.

Chief Financial Officer Peter Juhas declined to comment on how many more share buybacks the company might hold this year, but said it was a natural way for AerCap to deploy excess capital. He said the company was not currently likely to engage in merger and acquisitions activity.

(Writing by Conor Humphries; Editing by Jan Harvey)