Assumptions

The table is published on an annual basis and complements the quarterly updates to specific aircraft categories. The table encompasses both current and future lease rentals. The methodology involved in calculating lease rentals differs from that of values. Lease rentals display greater volatility. Rentals are calculated individually and are not directly linked to values. The listing of current and future lease rates is based on the year of build. However, unlike values, the relevance of the year of build is less significant. The essential assumption is that the aircraft are being leased as a single unit and between a willing lessor and willing lessee on a dry operating lease basis. Maintenance reserves are assumed to be payable in addition to the quoted rates. The assumed rentals period ranges between seven years for modern narrowbodies to nine years for the larger widebodies. Aircraft out of production will likely involve shorter terms. The assumed rental period will change depending on the then prevailing market conditions. Weak market conditions will usually result in shorter terms while stronger conditions will likely result in lessors seeking to lock lessees at higher rentals for the longer term. The high and low figures for April 2018 lease rentals represent adjustments for length of lease, the financial standing of the lessee and the return conditions. A longer lease to a stronger credit will likely result in lower rentals. These are not absolutes and sale and leaseback transactions may fall outside the figures indicated. Some transactions involving renegotiations on less popular aircraft may be considered exceptional and can fall outside the rental ranges. As aircraft age there may be less reliance on dry operating leases and greater emphasis on wet leasing or power by the hour agreements. The rentals quoted below were prepared in late April 2018 in the context of a still stable but increasingly vulnerable market. The lease rentals listed below are Market Rates not theoretical Base Rentals.  In addition to the commentary and lease rentals an indication of the Mid Case Lease Rate Factor (LRF), which expresses the current monthly rental as a percentage of the value, is also provided together with the relevant age of aircraft. The quoted future rental, expressed in thousands of dollars per month are Market not Base Rates and attempt to predict cyclic trends when supply will exceed demand and vice versa. Rentals may therefore experience a rise as well as a fall in any projected year. The future rentals – three and seven years from 2018 - are expressed in thousands of current dollars having been adjusted for inflation and are based on only the Mid Case projection rentals. The figures are for guidance only. M/R = Maintenance reserves are excluded and return conditions assume half-life. The data has been extracted from the April 30th 2018 semi-annual Aircraft Values Basic 2018-2038, priced $1,475.00, by courtesy of The Aircraft Value Analysis Company.  Telephone: +44 (0) 203 468 5594, Fax: +44 (0) 203 468 5596, E-mail: [email protected] Internet http://www.aircraftvalues.net; www.aircraftvalues.com