Chorus Aviation Inc
TSX:CHR
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Chorus Aviation Inc
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Good morning. My name is Moriyama, and I will be your conference operator today. At this time, I would like to welcome everyone to the Chorus Aviation Inc. First Quarter Results Conference Call. [Operator Instructions] Thank you.I would now like to turn the call over to Nathalie Megann, Vice President, Investor Relations and Corporate Affairs. You may begin your conference.
Thank you, operator. Hello, and thank you for joining us today for our first quarter 2018 conference call and audio webcast. With me today from Chorus are Joe Randell, President and Chief Executive Officer; and Jolene Mahody, Executive Vice President and Chief Financial Officer. We'll start by giving a brief overview of the results and then go on to questions from the analyst community. Because some of the discussion in this call may be forward-looking, I direct your attention to the caution regarding forward-looking statements and information, which is subject to various risks, uncertainties and assumptions that are included or referenced on Page 32 of our Management Discussion and Analysis of the results and operations of Chorus Aviation Inc. for the period ended March 31, 2018, the outlook section and other sections of our MD&A where such statements appear. In addition, some of the following discussions involve certain non-GAAP measures, including references to EBITDA, adjusted EBITDA and adjusted net income. Please refer to Section 16 of our MD&A for a discussion related to the use of such non-GAAP measures. I'll now turn the call over to Joe Randell.
Thank you, Nathalie, and good day, everyone. Thank you for joining us. This morning, we held our annual meeting with shareholders, and I'm pleased to report that all orders of business were approved. And I thank our investors and our board for the support. It is also my pleasure to welcome Ms. Margaret Clandillon to our Board of Directors. Margaret is a highly experienced corporate director with over 30 years of legal and business experience in aircraft, leasing and capital markets. Her counsel will be valuable as we continue to execute our growth strategy. Now turning to the first quarter. I'm pleased with our overall performance and believe we are off to a positive start. Our efforts in this period were concentrated on maintaining the momentum achieved in 2017 towards our vision of delivering regional aviation to the world. We were very pleased to welcome Dublin-based CityJet to our growing portfolio of regional lessees. This transaction was a sale and leaseback of 2 CRJ900s, bringing our fleet of leased aircraft to 67, with an average age of 6 years.In the quarter, we successfully completed an equity raise that yielded approximately $107 million in net proceeds, bringing the total amount of capital raised for our leasing business to just over $300 million since the start of last year. When combined with the anticipated debt financing and typical ratios of up to 3x equity. This capital affords us the ability to invest up to $1.2 billion in aircraft for third-party leasing. Based on our deployment rate over the last year, we expect to fully deploy this capital by mid-2019. We have ongoing active negotiations and continue to have many good opportunities to assess. Our intention is to deploy this capital prudently, as we've done to date, methodically and deliberately, with a good mix of aircraft types, clients and geographic locations. Jazz and Voyageur continue to operate within our expectations and are maintaining a solid course of delivering positive customer satisfaction. Jazz Technical Services completed the fifth Extended Service Program on a Dash 8-300, that is now contributing to our leasing revenue stream under the CPA with Air Canada. And we were pleased that Jazz's Airport Services group ratified a new collective agreement that extends to January of 2022. I thank the Chorus team for their continued efforts toward our shared vision.Before closing, I'd like to take this opportunity to congratulate Air Canada in its results, especially given the difficult weather this past winter. There is, however, one point I'd like to clarify relating to the deployment of the Rouge. From our perspective, we view Rouge positively as it not only makes Air Canada stronger, which is good for us, it also provides additional destinations which we feed. Rouge broadens the Air Canada network and all other services benefit. This broadening of the network helps Air Canada launch new regional feed routes, such as the 2 that were just announced: Montréal to Windsor and Montréal to London. Recently, Air Canada also announced 7 new routes in Western Canada, which will be flown by Jazz. We work very closely with Air Canada to help maximize its network and the deployment of Rouge services on routes which have traditionally operated -- we have traditionally operated, is in fact a good sign. It shows that demand has grown enough to support the larger aircraft. This has always been the case where mainline services move on routes where demand is sufficient. And this is often done seasonally. It's all about putting the right aircraft on the right routes at the right time. Air Canada has a lot of flexibility to match capacity to demand using our services. And also, we enable Air Canada to explore and to test new markets.Our fixed fee compensation under the CPA isn't affected by where we fly or how much we fly. This ensures a strong alignment of interest with our customer, Air Canada. We deploy our aircraft on routes they deem best, and our fees for operating the flights don't change as a result. These fees and the minimum number of aircraft in the CPA fleet are set out in our agreement until 2025. And any changes to our contract require mutual consent. I thought it's important to remind our shareholders of this given the market's reaction to this news earlier this week, especially when you consider how robust the fundamentals of our business continue to be.Looking ahead, we remain focused on creating additional long-term shareholder value by capitalizing on our industry relationships as we build our core competencies in regional aircraft leasing, on-track flying operations and MRO.I'll now turn the call over to Jolene, and she will take you through the financial results.
Thank you, Joe, and good afternoon, everyone. We continue to transition our business, and I am very pleased with our progress. In the quarter, we generated total revenue of $347.6 million versus $319.8 million in the same period of 2017, an increase of $27.8 million or just under 9%. The primary driver of this increase was our non-CPA aircraft leasing, which, together with maintenance repair and overhaul, increased by 123% quarter-over-quarter. The objective of our growth plan is to build non-CPA revenues by leveraging the expertise within our organization to deliver a full suite of regional airline services to customers worldwide. Approximately 88% of our revenue was generated under the CPA in the first quarter as compared to 94% in the same period of 2017. Bear in mind, however, that approximately 71% of our consolidated revenue in the quarter was attributable to pass-through and controllable revenues, which are intended to reimburse Chorus for services provided under the CPA. With our recent capital raise, our intention is to continue building our regional aircraft leasing revenue.Now I'll turn to the first quarter of this year and show you how the results compared to the same period in 2017. We reported adjusted EBITDA of $78 million versus $54.4 million in 2017, an increase of $23.6 million or 43.4%. The $23.6 million increase in adjusted EBITDA was primarily driven by a $13.8 million increase due to the growth -- mainly due to the growth in third-party regional aircraft leasing; increased aircraft leasing revenue went to the CPA of $2.3 million; increased stock-based compensation of $2.2 million; decreased operating costs related to a $1.3 million increase in capitalized labor and maintenance costs on owned aircraft for major maintenance overhauls; and a decrease of $4.9 million in other expenses, this is offset by a decline of $0.9 million in CPA performance incentive revenue. Adjusted net income came in at $26.5 million for the period, an increase in 2017 of $10.4 million or 64.5%. Adjusted earnings per share rose 51.5% to $0.21 per basic share. The change was a result of the $23.6 million increase in adjusted EBITDA previously described and a $0.2 million decrease in income taxes, which is partially offset by $5.8 million of interest costs related to increased aircraft debt and convertible units; and $7.6 million of additional depreciation, primarily related to new aircraft.Net income was $5.1 million for the period, a decrease of $29.9 million (sic) [ $21.9 million ] or 81.3% from the same period of 2017. This decrease was due primarily to changes in unrealized foreign exchange losses of $32.2 million, which was offset by the previously noted $10.4 million increase in adjusted net income.In February, we implemented a dividend reinvestment plan to help support our growth in our aircraft leasing business. The plan currently offers a discount of 4% from the average market price per share purchased under the plan, and I'm very pleased with the current approximately 20% uptick so far. Looking ahead to the balance of this year, capital expenditures for 2018, excluding those to the acquisitions of aircraft and the ESP, but including capitalized major maintenance overhauls, are expected to be between $44 million and $50 million. Capital expenditures for ESP and aircraft acquisitions that we announced as at March 31, 2018, are expected to be between $81 million and $84 million. However, this excludes future capital for aircraft acquisition. Based on scheduling information from Air Canada, billable block hours for 2018 are expected to be between 360,000 and 375,000 hours, and this is based on 116 Covered Aircraft as at December 31, 2018. The actual number of billable block hours for 2018 may vary from this anticipated range due to many factors which are outlined on Section 9 of the risk factors.For additional information supporting our projected guidance for the balance of this year, I refer you to Section 4 of the 2018 outlook section of our MD&A for the period ended March 31, 2018.And that concludes my commentary. Thank you for listening. And operator, we can now open the call to questions from the analyst community.
[Operator Instructions] Your first question comes from Walter Spracklin with RBC.
So Joe, you addressed the Rouge issue. Because at first, when Calin kind of highlighted it, he actually used the example of Halifax and St. John's as being instead of a few flights on a regional aircraft, we could connect it into less flights, moving same or more people on a narrow-body, which kind of led to that view that maybe there will be less use of regional players. But to your point, you're seeing that as either offset or not only offsetting but adding by the new connectivity that the additional Rouge routes provide. Is that right?
Yes. I think the whole idea of Air Canada's route network is really to put the rightsized airplane in the right -- to compete against whoever is on the route in the right manner. And nobody owns routes. There's not a -- you can say that a particular route is operated by us, but nobody actually owns the routes, they are left to Air Canada's revenue management and scheduling people to decide what the best combination is. And in the past, we've had many examples of routes that we have operated that Air Canada put larger equipment on and vice versa. A number of routes have been down the gates over the years as well. And it's a function of the connectivity, it's a function of the local market, et cetera. And I think what people fail to see is that since Air Canada has been expanding, we've gone on a lot of new flying, especially in Western Canada, routes like Denver-Vancouver, San Jose-Vancouver, Dallas-Vancouver, Chicago-Vancouver is an example, all feeding Air Canada. And aside from those routes, now that we've been operating for a period of time, there were 7 routes that were just announced in Western Canada not long ago, including Edmonton-San Francisco, Edmonton-Kelowna. I won't go through the list. But -- so we're not seeing a decrease in the demand for hours on our services. We're seeing a redeployment, which is really what it's all about. The network is not static. It's going to keep changing all the time. And when you look at the additional feed that we provide, we feed Rouge, just like we do mainline. So if Air Canada puts on a new Rouge flight from Montréal to Budapest, as an example, that's a great opportunity. We -- Air Canada has launched new services from Montréal to Philadelphia to Baltimore, et cetera, and a lot of these services connects to Rouge services out of Montréal as an example. So the whole system is rather dynamic and it sounds as if we're being replaced in some of these. But overall, it's really a redeployment, realignment, and that's more of what it's all about. And that's how we see it.
So if there is a redeployment, I mean, the risk, I guess, is that you might lose a route due to densification, but you don't get the redeployment because it goes to another regional player. Are you -- well, are you winning most of the new routes? Can you give us some comfort that of the regional routes that have been redeployed, you've won the majority of them? Or is that fair to say?
No. Well, I think I've gone through the list of the routes that have been announced that we will operate. I don't have the top-of-mind in terms of the other regionals, but we have not seen a shift in the share of [ deployments ] that we have as a result of this at all. So I'm really a little bit -- we were a little bit baffled in terms of how the market interpreted this and how it responded. Because the fundamentals of our business and our relationship with Air Canada, the amount of flying that we do and the flexibility we give Air Canada is exactly the same as it's always been.
That's good to hear. And I guess, when the C Series comes out, the same thing, do you see that as opening up routes? Or is that a threat to the C Series now encroaching in on some of what the regional flying you would have been doing? Because as I understand it, the C Series will continue to be operated by mainline, is that right?
Yes. Again, I think we will see some new routes, we will see some changes. Of course, what you have to recall and what you have to remember is that Air Canada is taking over this fleet of 190s, and the C Series is more equivalent to that size of aircraft. And if Air Canada succeeds and grows, we'll see new routes, new opportunities. And in the event of a downturn, frankly, the converse is generally true, where there are a lot of routes then that, all of a sudden, can't support the larger equipment, and that's where we are deployed. I think quite often, it's the larger equipment on the larger end of the scale that -- where there are fewer options that suffer the most in an event of a downturn. So we're a bit of a hedged -- we're hedged in terms of the downturn because we've got the rightsized airplanes with the right economics to offer and still maintain good frequency. So...
Okay. And just to be clear, I mean, since they operate the 190s, is there no chance you'll be able to operate the C Series for Air Canada? Is that already been signed, sealed and delivered kind of thing?
Yes, we're -- that's not in our portfolio at this time. So, yes.
Okay. Moving over to the leasing business, I noted there was a little bit of a language change on your leverage from, I think, it was 3 to 4 to 1 to now up to 3 to 1. And I'm just wondering if are you seeing any obstacles that weren't there before? Is higher interest rates a consideration here? Is there anything that would lead you to adjust your leverage? And maybe just give an update on exactly the environment for the leasing of new -- and deployment of new aircraft as well, that'd be helpful.
Well, Jolene may have a comment on the leverage, I guess, in that. But in fact, we're not really seeing anything much different than what we did before. As a matter of fact, we're finding now as we get more leverage in volume and a track record here, that, that is actually going to help us in terms of the financing of the fleet. Because the cost of capital is critical, the more you leverage it up, frankly, the better you do. So -- and we're seeing some positive trends on that.
Yes. I think, Walter, if there was any language change, it was certainly unintentional. I don't take any meaning into it. We continue to see and achieve high leverage rates that we had in the past. And as Joe said, in fact, under some of the arrangements that can be put in place with EDC, with the track record, I think, that we're creating and stuff, we expect lowering cost of capital and ability to leverage to a greater degree if we chose to do that. But the numbers of 3 to 4 to 1 is still fully intact.
And interest rate -- rising interest rate?
Yes. No, we're not seeing any follows of rising interest rates. I mean, as you know, our approach, certainly from the deals that we have to date, we lock in our interest rates in one form or another and we match it up with the lease term. And as time moves on, I think you'll probably see inflection point with OEMs increasing pricing based on increases in interest rates, which we'll continue to bake into our investment decision that ends to leasing rates themselves. But we're not seeing any bottleneck at that stage.
I think rising interest rates will cause all boats to rise with the tide, because I think you'll see that reflected in lease rates. And in terms of carriers themselves, the cost of financing the aircraft if they were to do acquisition is going to increase as well. So other than the ultimate impact that it may have on the economic -- in the world economy, which still seems to be going very well, it's not something that we lose any sleep over.
The next question comes from Cameron Doerksen from National Bank.
I guess, just a couple of questions on the Chorus Aviation Capital business. I mean, just firstly on the -- I guess, the pace of capital deployment here had slowed a little bit in the last couple of quarters. I know there's some lumpiness to getting these transactions done. But how comfortable are you in kind of deploying -- or deploying capital to bring in another 20 or 25 or so aircraft by mid-2019, that's only sort of 12, 14 months? I just want to get the -- if you still feel pretty confident about being able to do that.
Yes, we're very confident about that, Cameron. We have a number of transactions at various stages in the development cycle. As you said, it's is going to be a little lumpy. If you look back over last year, I think we did what we said we were going to do. And it was still a little lumpy. It's more about getting the transactions, the right transactions before us. And we're -- we see a good pipeline and continue a good pipeline of opportunities. So there's no change in that regard. The first quarter, certainly the last little while, has been a little slower, but we see the pace picking up.
Okay. And I think maybe one of the limiting factors, if we go back 6 months-or-so, was just the size of the team at Chorus Aviation Capital. Have you basically still [ note ] to all the necessary team there to get the transactions over the line?
Yes, we've grown the team. We have our Chorus Aviation Capital Ireland, and we're in the process of even adding more resources there. So we've brought a lot of people in with various backgrounds with leasing companies, et cetera. So we're building a stronger team as it goes forward. We're being careful about not overbuilding as well, because it's a matter of building the team at the right pace. But we're getting traction and as time goes on, it will increase the number of professionals that we're going to have. But we have all the primary functions certainly well covered. And of course, we do get some technical support from Voyageur, et cetera, and so it's -- we're able to draw on some of that.
Okay. And the SG&A costs related to Chorus Aviation Capital, where do they show up on the income statement?
So they run throughout the income statement, Cameron. So the majority, obviously, would be in the form of salaries, which would be in the salary line, combined with all the rest of the employee labor costs. And then anything else, if it's not capitalizable in transaction costs, they would flow through the other expense section of the P&L.
The next question comes from Kevin Chiang with CIBC.
Maybe just a follow-up question on the impact of rising rates. I'm wondering, as rates rise, are you able to increase the lease terms to reflect the spread? Are you seeing any push back? Or maybe rates haven't risen enough for you to have those conversations? I'm just wondering, are you able to match that spread even as rates rise here?
Yes. So just, the -- I think -- I guess, you're talking about prospective deals. Certainly, on the deals that we've done to date, they're -- 95% of the interest rates are fixed, so we're not exposed there. And yes, on a -- we've not seen any, I guess, margin compression to this point on rising interest rates at all. We've been able to kind of maintain kind of that targeted range that we had anticipated and wanted. So we'll kind of see what happens as time goes forward. But we've not seen any followed implications.
And we continue to look to match the term of the debt to the terms of the lease and at fixed rates. So...
Okay. That's helpful. And then when you think of the size of the pie, and you've highlighted by mid-2019 you'll basically be double your current levels now, so maybe closer to 50 aircraft, give or take. How big does the fleet get? The non-Air Canada component of the lease portfolio, how big can this get? It seems like this pipeline is very deep. Is it 70 planes? 80 planes? Or specificity to kind of a good level you'd like to stay at.
Well, we see, as we get traction and we're maintaining the right balance in terms of the financial leverage that we have and the equity that we have to invest, et cetera, maintaining and looking to capitalize on the opportunities that are there, we presently haven't said anything really beyond 2019, but we see it as a growing enterprise. And you have some very -- the largest regional lessor in the world, it's got about $6 billion of assets and -- which is Nordic. And we continue to see good opportunities in becoming a strong-willed #2 in the regional aircraft leasing business. We're certainly quite a bit smaller than Nordic is, but it's all about doing it prudently, about taking on the appropriate risk-reward levels. And I think we're getting good tractions. We're seeing a lot of traction. We're seeing a lot of opportunities out there, that, in fact, we're not interested in. So we're being cautious, but it clearly is the growth end of our business.
That's helpful. And last one from me, maybe I'll follow on -- you spoke of the growth opportunities with Air Canada given their expanding network and the ability for you to help connect the dots. When I look at -- I know billable hours might not be the perfect proxy. But if I look at the high watermarks for your billable hours, looking back the last, I don't know, 10-plus years, call it about 400,000 hours in a very different environment. And today, you're kind of north of 90% of that level. Are you -- I'm wondering what the utilization rate of your covered fleet is? Like if Air Canada continues to grow, do you need to start adding to the covered fleet? Or is there a significant amount of additional flight you can still do with the planes you have currently under the CPA-covered fleet?
Well, I think the underlying issue under the hours, and you're right about the hours, is that you'd have to really have to look at what the fleet is composed of. And we have really shifted further and further away from 37- and 50-seat airplanes to 75-seaters. And that's just a matter as to -- a fact as to what's happening in the regional business, and especially as the markets grow, et cetera. And we see opportunities on the 75-seat aircraft side. The smaller aircraft, the ASM costs are higher because of the smaller aircraft. So there's a natural movement. Now if you look at our ASM production, despite the lesser hours, our ASM production was up 3% over last year, 2017 over 2016. So we have a covered fleet. We have an agreed-upon fleet. But we're always open to discussion with Air Canada about changing the mix, providing Air Canada with a better combination that would enable them to feed better, et cetera. So I think you will see, as time goes on, that the fleet will adjust, et cetera. But the undermining of the -- the undermining economics of the CPA for us are solidly intact even with changes in that regard.
The next question comes from Turan Quettawala from Scotiabank.
I guess, I wanted to just ask one on the covered fleet as well here. I guess, Joe, in terms of the covered fleet, can you just remind us again, I think the minimum is sort of very close to the 115, 117 aircraft out to at least 2020, is it not? And how much is it out to 2025?
So the minimum fleet is actually what we're operating. And so, it's 117 planes currently. It moved to 116 planes by the end of this year. And then, Turan, as the -- we have a number of Dash 8s. If we rolled into the older years, that number drops down to currently a minimum fleet commitment of 96 airplanes at the end of 2025. That's really predominantly driven by the 37-seat aircraft, the Dash 8-100. But as they meet their life limit, they kind of come out of the fleet we have.
There are 5 more 75-seat aircraft in the plan as it exists today in 2020, I believe. So although there's a reduction in the number of fins, when you look at the ASM production, I keep going back to that, then that's -- that remains very solid. And of course, the compensation that we receive is well defined out to 2025.
No, I understand that. Okay. Perfect. And then, I guess, the other question I had was I saw that there's about 10 planes, I guess, in your fleet that are not operational right now. Just wondering as to what plans you might have for those? Are they just sort in the maintenance cycle? Or is there basically maybe an ability to either lease those out or something?
Yes, we've taken quite a number of Dash 8-100s over the last few years. We've converted some them from passenger to freighter, they're under lease. We leased others to third parties. We actually redeployed some of those aircraft through Voyageur for the contract flying. And we parted out quite a number. And we've done quite well, actually, when we parted out these aircraft. So we do have a number right now sitting, and we are looking to remarket those airplanes. I think we're getting some interest -- further interest in the freighter side, et cetera. So these are assets that we just have available that we're looking to repurpose, and that's what Voyageur is all about.
And Turan, those assets are fully owned. I mean, there's just a small depreciation cost associated with them. There's no debt or anything against them.
Yes. And I guess, maybe one last one from me here. On the ESP cost. I guess, so that generally related to the pilot flow-through agreement, is that right?
Sorry, what was the question?
The ESP cost, I think, in the quarter. Are those all -- I think it's $4.2 million or something, is that all basically the pilot flow-through agreement?
The ESP cost?
Oh, did I misread that?
So the -- or the BSP cost, sorry. You're talking about employee separation program costs?
That's right.
Yes, so you're right. They were $3.5 million, a combination of pilots and maintenance employees that we continue to invest in. Yes, Turan, our objective is to populate those new industry wage rate scales, and so we'll continue to invest to change the demographic to populate those scales. You're exactly right.
And then are you getting -- are you having any difficulty in getting pilots right now on the other side? And maybe just talk a little bit about the average age of your pilots? I mean, are we getting to the right number now on that side?
So we continue to have a good pipeline of well-qualified pilots. We've been very proactive to ensure that that's the case. We've had a really good flow of pilots to Air Canada, over 500 have gone over. And right now, if you look at our pilot roster, 54% of our pilots are under the new wage scales and the new agreement. So we've seen a major shift there. We actually hired 1,200 new employees last year. So we are repopulating all of Jazz, really, with a younger demographic under the new agreements, et cetera. I don't have an average age, but I will tell you that we sort of do have 2 bumps in the age. We have a very young group of pilots that are the recent additions primarily, and then we have a more mature number of pilots that have been with here -- with us quite a long time. So we've got a real good combination. So the age is in the middle. I'm sorry, I don't have the...
And I think the relevant metric for us is the percentage of population on the new scale, which is about 54% versus age, yes.
Your next question comes from David Tyerman with Cormark Securities.
My question's on the MRO third-party flying, et cetera, everything but the CPA and the leasing business. Just wondering if you could kind of scale it for us right now and give us an idea of how quickly it's growing and what the opportunities you'd see for it over the next couple of years there.
Yes, I think on the MRO business, we've done some third party through JTS here with Jazz. We're a Bombardier-approved maintenance organization now. So -- but essentially, if you go to this hangar today, we've got about 6 lines of business -- or 6 lines of MRO. Two of them are outside, the remainder of the Jazz fleet. And it's -- the facility here is basically operating at capacity. We continue to do specialty work in North Bay, and we're actively working at growing that business. The parts business, of course, has been growing very well. But it's still not a particularly material part of our revenues. It -- really the revenues are driven by contract flying and aircraft leasing. So we don't have any specific numbers in that regard, but it really is supportive of the rest of our lines of business.
Yes. And if I can just add to Joe's comments, David. So the MRO flow-through, I guess, that's other revenue category on the P&L, along with third-party leasing. And predominantly, the -- if you kind of back into trying to figure out what portion is what, I'd say, predominantly, a majority of the increase year-over-year, quarter-over-quarter, is driven by the leasing side versus MRO. MRO for the quarter, fairly flat, up a little. But we have a lot, as Joe said, of internal work going on at JTS. Even with the Dash 8-300s, we're doing all that work in-house and that's ticking up a bit exactly. But then the other non-CPA stuff I think you're referring to is the contract flying related to Voyageur. And that is post separately chartered and contract flying in that line. You'll see is fairly consistent with last year as well. But I'll just remind you that, last year, we saw pretty significant uptake in that line and we were over 16% in performance growth in that top line for the year. So we don't expect to repeat that growth level this year. It was pretty big tick-up with the same fleet, really, a couple of more Dash 8s. But -- so for this year, I think, you'd model something a little bit more modest in that line as far as growth.
So should I basically conclude from all this that the -- everything about the CPA and the leasing really is kind of a flat business, doesn't grow much? Or is it [indiscernible]?
No, no, no. I wouldn't say that. I'm just trying to characterize the first quarter numbers, right, so that you can kind of figure out what's on that other line. Because I know that it's frustrating to try to figure out how much is driving from the third-party leasing. I wouldn't say that at all. And relatively wide. This is obviously small because -- just the nature of the pool of business that's there. But there is certainly some modest growth there. But it's not 43% growth that you're seeing in the aircraft leasing business.
[Operator Instructions] The next question comes from Tim James with TD Securities.
I just have a question about the long term here, the very long term. What should investor think about as a possible trigger or an achieved financial metric that could be a catalyst for an increase in the dividend? And when I say long term, meaning 5 years or more in terms of what constitutes the long term.
Yes. We've not really focused on any particular time frame. Our efforts right now are going into investing and growing and diversifying the business, and we believe that is what will bring the greatest value to the shareholder in the longer term. Of course, we watch the dividend, et cetera. The yield continues to be very high. And our efforts are really on building that share price and executing on our growth plan so that we don't see drop-offs in share price, like we've just had this last little while. It's really about the fundamentals of the business are good, it's about strengthening the foundation, gaining more momentum. And I think at the appropriate time, it would be looked at, but we don't have any time frames right now.
There are no further questions at this time. I will now turn the call back over to the presenters.
Thank you very much, operator, and thank you, everyone, for being present on the call. We wish you a very pleasant weekend.
This concludes today's conference call. You may now disconnect.