Gaining Altitude AAWW Investor-Analyst Day May 30, 2013
Safe Harbor Statement This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect Atlas Air Worldwide Holdings, Inc. s (AAWW) current views with respect to certain current and future events and financial performance. Such forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the operations and business environments of AAWW and its subsidiaries that may cause actual results to be materially different from any future results, express or implied, in such forward-looking statements. For additional information, we refer you to the risk factors set forth in the documents filed by AAWW with the Securities and Exchange Commission. Other factors and assumptions not identified above are also involved in the preparation of forward-looking statements, and the failure of such other factors and assumptions to be realized may also cause actual results to differ materially from those discussed. AAWW assumes no obligation to update the statements in this presentation to reflect actual results, changes in assumptions, or changes in other factors affecting such estimates, other than as required by law. This presentation also includes some non-gaap financial measures. You can find our presentations on the most directly comparable GAAP financial measures calculated in accordance with accounting principles generally accepted in the United States in the appendix to this presentation. Additional information about AAWW s historical financial information is available on our Web site at www.atlasair.com. 2
Today s AAWW Attendees Bill Flynn President & Chief Executive Officer John Dietrich EVP & Chief Operating Officer Spencer Schwartz SVP & Chief Financial Officer Michael Steen EVP & Chief Commercial Officer Adam Kokas SVP, General Counsel, CHRO & Secretary Greg Guillaume VP, Strategic Development Dan Loh Senior Director, Investor Relations Edward McGarvey VP & Treasurer Bonnie Rodney Senior Director, Marketing & Communications 3
Today s Agenda Welcome Overview Commercial Operations Financial Wrap-Up Adam Kokas Bill Flynn Michael Steen John Dietrich Spencer Schwartz Bill Flynn Q&A Lunch 4
Overview Bill Flynn President and Chief Executive Officer AAWW Investor-Analyst Day May 30, 2013
AAWW Key Takeaways Executing our plan, Resilient business model Operating income, cash flow strength driven by business mix, productivity gains, efficiency initiatives Full-year outlook affirmed Share repurchases, tax planning drive additional stockholder value Strong upside operating leverage 6
Strategic Growth Map: 2008 Polar Scheduled Service incurred losses prior to the start of DHL Express ACMI AMC produced significant profits; we expected this segment to contract long term The 747-200F was employed as swing capacity Polar Scheduled Service AAWW ACMI AMC Cargo Agency Commercial Charter 7
Strategic Growth Map: 2013 We continue to expand and diversify our business, leveraging our core competencies and market leadership CMI SonAir Boeing Dry Lease Parts Supply Joint Venture DHL Others AAWW ACMI AMC Commercial Charter Pax Cargo Agency Cargo Pax 8
AAWW Resilient Business Model Asia-Pacific Region Traffic-Capacity Trends (% Change Y-o-Y) 95 80 65 50 35 20 5 (10) (25) (40) (55) -$6.4 $3.9 $10.2 $49.3 $24.8 $17.7 $21.7 $54.3 $43.9 $18.5 $76.4 $10.3 $62.1 $55.1 Benefited from M-ATV flights for military $20.3 $49.8 $43.1 2008 2009 2010 2011 $66.0 $19.4 $50.7 $53.6 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2012 $76.9 20 $10.2 13 95 80 65 50 35 5 (10) (25) (40) (55) AAWW Adj. Pretax Income* ($ Millions) Source: IATA March 2013 *See Appendix for Non-GAAP reconciliations of adjusted pretax income. Traffic (FTKs) Capacity (AFTKs) AAWW Price Change (%) 9
2013 Goals and Objectives Deliver superior service quality to our customers Deliver Adjusted EPS ~ $4.80 Expand our ACMI and CMI business Maximize AMC and Commercial Charter business opportunities Grow Titan fleet and placements Achieve Continuous Improvement savings and efficiencies Execute share repurchase program In other words Drive Value for Stockholders 10
Continuous Improvement An Ongoing Journey It s about: Doing things smarter, faster, more efficiently & at lower cost Adding value to the customer Operating safely & more efficiently More thoughtful decisions & processes Differentiating ourselves from the competition customer service Building relationships Great track record, ongoing focus We cannot control the market We can control our behavior and how we operate All leads to being the customer s first choice & higher revenues 11
Atlas Strategy for Future Growth We have implemented a strategic plan that Delivers strong earnings Diversifies the business mix Leverages asset acquisitions Generates strong cash flow Future growth requires a disciplined plan that Builds on strength of core model Invests in appropriate asset portfolio Balances operation segment risk / reward profiles Develops new organizational capabilities 12
Disciplined Approach to Business Growth Fleet Evaluate opportunities for incremental aircraft that Provide customers most efficient assets for their needs CMI Expand asset-light business Target strategic opportunities Dry Leasing Focus on freighters Invest in quality assets with lease commitments 767s Focus on scale Non-speculative investments for regional networks 13
Commercial Michael Steen Executive Vice President and Chief Commercial Officer AAWW Investor-Analyst Day May 30, 2013
Business Developments ACMI Added a 747-8F with Etihad Cargo Added a 747-400F with Chapman Freeborn CMI Launched 767-300ERF operation for DHL Express in Asia Pacific region AMC While demand declines, Afghanistan withdrawal could result in short duration uptick in both passenger and cargo Providing thought leadership to ongoing CRAF study Charters Grew commercial charter despite weak market Contracted short-term ACMI programs for multiple carriers Dry Lease Acquired a 777-200LRF with long-term lease attached to AeroLogic GmbH 15
Our Value Proposition to Our Customers World s most-efficient aircraft and operating solutions Market leader in each of our operating segments Customer base reflects the quality of our assets and services Best assets and best services attract best customers Asset and service offerings represent a flexible portfolio that allows expanded customer service and enables us to better manage risk 16
Our Customers Reflect Our Focus on Quality Long-term, profitable relationships Resilient Business Model & Predictable Revenues Strategic focus on cargo Growth-oriented market leaders High degree of customer integration Focus on continuous development and growth Long-term contractual commitments Long-term earnings growth 17
Diversified Global Operating Network 152,707 Total Block Hours Operated in 2012 22,704 Flights 361 Cities in 113 Countries 970+ Charters Completed 65 Unique Customers Asian trade lanes lead market growth Rapid market growth in Middle East, Africa, South America Globalization requires global supply chain solutions Outsourcing becoming more relevant 18
Market Outlook IATA expects freight market growth of 2.6% in 2013 IATA forecasts 2012-2016 freight market CAGR of 4.5% Global Airfreight Tonnage Growing from Near-Record Levels 50 40 Freight Tonnes (Millions) 33.5 36.7 37.6 40.0 42.0 41.0 40.7 48.0 47.6 46.5 47.7 30 20 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012F 2013F Y-o-Y -- 9.6% 2.5% 6.4% 5.0% (2.4)% (0.7)% 17.9% (0.8)% (2.3)% 2.6% Source: ICAO 2003 2010, IATA 2011 2013F (IATA March 2013) 19
Global Airfreight Drivers Airfreight value: 1-2% global volume, 35% global value High-value, time-sensitive items; items with short shelf lives Products / supply chains with just-in-time delivery requirements Products with significant security considerations By Drivers Industry Sectors Served by AAWW Customers By Region Percent of International Freight Tonne Kilometers (FTKs) Automotive Mail & 5% Express 6% Pharmaceuticals Other Live, 1% 6% 11% High-Tech 17% Products 17% Capital Goods North America Middle East 17% 14% Latin America, 3% Africa, 1% 40% Asia Pacific 10% Apparel 11% Perishables 16% Intermediate Materials Europe 25% By Drivers Chart Source: Atlas research By Region Chart Source: International Air Transport Association March 2013 20
Optimal Inventory Management is Key Inventory to sales ratio remains low Last time inventory levels were this low, record demand for airfreight followed Low inventory levels, combined with an improved economy, drive increased airfreight demand 21
Large Freighter Supply Trends Projected production capacity will grow in line with forecast long-term demand growth of ~ 4% Retirement of older technology is accelerating Large wide-body freighters will continue to dominate the major trade lanes Belly capacity cannot displace freighters 180 160 140 120 145 140 141 127 52 100 80 60 40 20 0 30 747-200F Old Technology Shrinking 65 MD11F 56 Recent but challenged 35 66 2007 04/13 2007 04/13 2007 04/13 2007 04/13 04/13 04/13 747-400SF 747-400F Current Technology 65 33 32 75 747-8F 777F New Technology Order Book Measured Source: Atlas (April 2013), Ascend (April 2013), Boeing (April 2013), company reports. Excludes parked aircraft, aircraft in express operations, combis and tankers; 747-200F total includes -100s and -300s. Boeing April 2013 777F total includes 38 deliveries to express operators (23 with FedEx, 8 with AeroLogic/DHL, 4 for DHL Express, and 3 with TNT). 22
Main Deck to Belly? Main deck air cargo share is stable at ~60% and forecast to remain steady (belly share ~40%) 70% 60% 50% 40% 30% 20% 10% 0% Percentage of World RTKs Carried on Freighters 62% 57% 59% 62% 62% 62% 62% 61% 58% 59% 59% 61% 60% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2016 2021 Key Considerations 10% shift of Trans-Pac market from main deck to pax belly requires 50 incremental aircraft Limitations on slot and route availability Not enough incremental passenger demand to warrant additional capacity Sources: ICAO, IATA, A4A, Boeing, Atlas 23
Aircraft Performance Comparison The 747-8F excels as a general freight aircraft Core to our ACMI operation Highest payload Lowest unit cost Global application Nose-loading capability The 777F is a strong fit for our dry leasing business Attractive asset Broad customer base Strong anticipated residual value Performs well on direct express service segments 24
Our Value Proposition
Integrated Partnership Our Value Proposition Operations Excellence Deliver best-in-class operational performance Flawless implementation and execution Delivering lower total operating cost Commercial Development Interactive dialogue creating opportunities Best-in-class analysis capabilities and consultancy support Proactive network and route assessment We Live Our Customers' Values We represent their brand We make their operations more flexible and efficient We continuously focus on delivering increased value 26
Business Perspective ACMI Airfreight continues to grow Market leader with multiple platforms Delivering value for customers Ability to offer turn-key solutions Strong customer base CMI Large-scale operating network Multiple aircraft platforms Delivering value to both Cargo and Passenger customers More than 900 experienced pilots, knowledgeable ground support Titan Dry Leasing Operating lease solutions Expanding portfolio (adding 777F s) Strong balance sheet Freighter aircraft conversion management and consulting services Commercial / AMC Charter Unmatched scale and infrastructure Leading charter supplier to integrators, forwarders and shippers In AMC Working with AMC to structure future CRAF program Promoting use of commercial lift 27
The Future The Industry Atlas Airfreight and integrators integral to global trade growth Higher-growth markets demand large wide-body assets High-value, time-sensitive inventories demand airfreight-based supply chain Airfreight provides a compelling value proposition Modern, reliable, fuel-efficient fleet Differentiated fleet solutions: 747/777/767 747-8Fs performing well Strong portfolio of long-term customers committed to further expansion Unique integrated value proposition High degree of customer collaboration Atlas is uniquely positioned for the future. 28
Operations John Dietrich Executive Vice President and Chief Operating Officer AAWW Investor-Analyst Day May 30, 2013
Operations A Key Strength of Atlas Provide innovative, outsourced aviation solutions Provide operational excellence and deliver customer value Operate global time-definite networks Be a catalyst for growth! 30
Our Business Starts with the Customer Be the customer s first choice by Delivering exceptional performance Delivering against aggressive reliability targets Holding ourselves & vendors to the highest standards Seeking continuous improvement in everything we do Being flexible to meet customer needs Building strong relationships with all our customers 31
Worldwide Presence 361 destinations around the world 32
Our Fleet 2006 (Pre-747-8F order) 18 Boeing Classics 20 Boeing 747-400 Freighters 33
Our Fleet 2013 Transformed Operating Fleet 9 Boeing 747-8Fs 24 Boeing 747-400 Freighters 21 747-400Fs 3 747-400BCFs 4 Boeing Large Cargo Freighters (LCFs) Customer-owned 4 Boeing 747-400 Passenger 2 Custom aircraft for SonAir (customer-owned) 2 Boeing 747-400s for AMC and Commercial Charter 3 Boeing 767-300ER Passenger For AMC and Commercial Charter 7 Boeing 767-200/300 Freighters For DHL Express service (customer-owned) 5 767-200Fs 2 767-300ERFs 34
Our Fleet with Titan Aircraft 9 Boeing 747-8Fs 24 Boeing 747-400 Freighters 21 747-400Fs 3 747-400BCFs 4 Boeing Large Cargo Freighters (LCFs) Customer-owned 4 Boeing 747-400 Passenger 2 Custom Aircraft (customer-owned) 2 Boeing 747-400s for AMC and Commercial Charter 7 Boeing 767-200 / 300 Freighters For DHL Express service (customer-owned) 3 Boeing 767-300ER Passenger For AMC and Commercial Charter 1 Boeing 777-200LRF AeroLogic 1 Boeing 757-200 Freighter Shanghai Air Cargo 1 Boeing 737-300 Freighter China Postal 2 Boeing 737-800 Passenger 1 Kenya Airways 1 Skymark Airlines 35
Growth in Fleet Types Achieved 767 certification in just 6 months with ETOPS Began operations at end of 2011 with three aircraft Fleet expanded from zero to 10 aircraft in 12 months Three passenger 767s and seven cargo 767s 36
Leveraging Operations Diversification & Growth 2010 (747 Pax CMI) 2010 (LCF) 2011 (AMC Pax) 2012/13 (767 Cargo) 37
Safety and Regulatory Compliance Safety & Compliance are Top Corporate Priorities Culture and commitment to safety Tone at the Top Robust internal and external audits Proactive relationship with FAA, DOT, TSA and other regulatory authorities Consistently Positive Audits On IATA Operational Safety Audit (IOSA) Registry since 2007 Zero findings in most recent IOSA and Dept. of Defense (DOD) biannual audits Successful customer audits (e.g., Etihad) Well-positioned for next IOSA audit in October 2013 Proactive Safety Management System (SMS) Flight Data Monitoring Program Aviation Safety Action Program (ASAP) Investigation Reporting Systems Regular safety audits 38
Security Our goal is to protect our people, our assets, our information systems and our customers Highly experienced security team Strong commitment to physical and cybersecurity Security resources that cover more than 300 cities in 150 countries Threat-based risk management program Implemented in coordination with customers Minimizes threats to personnel, company assets, high-value cargo Provides thought leadership to ensure cost-efficient and effective regulatory approach Highly active in Washington, D.C. on policy and rule making initiatives 39
Continuous Improvement Company-wide focus in 2013 Savings run from a few thousand dollars to several million dollars each $25 million is permanently removed from cost base Examples CF6-80 engine program Component overhauls and repairs Procurement initiatives Streamline passenger catering Reduce ground travel Reduce manuals expense through automation $ $ $ $ $ $ 40
Why Atlas? We manage diverse, complex and time-definite global networks We deliver superior performance and value-added solutions Our global scale and operational capabilities are unparalleled We possess industry-leading operational and technical subject-matter expertise We collaborate with customers to achieve best-in-class results We are driving Continuous Improvement We are strategically positioned and focused on new opportunities to continue to deliver future growth 41
Financial Spencer Schwartz Senior Vice President and Chief Financial Officer AAWW Investor-Analyst Day May 30, 2013
1Q 2013 Conditions Activities Results Shifting profile of AMC flying Pax BHs up 38%; Cargo BHs down 41% Pax more heavily weighted towards B767 Cargo one-ways declining Soft Charter market Revenue per BH and utilization are down Capitalized interest down $5 million 747-8Fs delivering as expected Proactive fleet management One aircraft temporarily parked/ realized maintenance savings Market conditions dictate return Paid off two bank-financed aircraft early Continuous Improvement focus 7 engine overhauls removed from 2013; saved approximately $19 million Operating Revenue up 5% Operating Income up 10% ACMI Direct Contribution up 65% Free Cash Flow $42 million* *See Appendix for Non-GAAP reconciliations of free cash flow. 43
2013 Guidance Assumptions Led by ACMI, all segments expected to be profitable Strong growth from 747-8Fs Continuous improvement Offsets headwinds driven by: Soft AMC cargo demand / Commercial Charter yields Reduction in capitalized interest $172 million of Maintenance expense; > 60% in 1H13 34% in 1Q, 27% in 2Q, 23% in 3Q, 16% in 4Q 175,000 Block Hours (BHs), up 22,000 from 2012 77% ACMI, 13% Commercial Charter, 10% AMC Charter Quarterly earnings acceleration ~80% of adjusted EPS expected in 2H13 ~70% of reported EPS expected in 2H13 Core capex for the balance of the year ~ $50 million > 10,000 AMC pax BHs, > 8,000 AMC cargo BHs > 8 747-8Fs in service on average compared with 4.3 in 2012 Share repurchases of $50 million 44
Cash, FCF and Net Leverage Cash, Cash Equivalents & Short-Term Investments ($ Mil) $420 $500 Free Cash Flow (1) per Share $10.75 Net Leverage (2) / EBITDAR Ratio Excluding EETC Assets Including EETC Assets $195 $7.85 4.9 4.6 4.4 $2.95 4.5 4.3 4.1 2011 Act 2012 Act 2013 Fcst 2011 Act 2012 Act 2013 Fcst 2011 Act 2012 Act 2013 Fcst 1) FCF = Cash Flows from Operations Base CapEx Capitalized Interest. Base CapEx excludes purchase of aircraft. 2) Net Leverage = (Face Debt + TTM Capitalized Rents) (Cash, Restricted Cash & S-T Investments). 3) See Appendix for Non-GAAP reconciliations of Free Cash Flow and Net Leverage. 45
Capital Allocation Strategy Committed to creating, enhancing, returning value to our stockholders Cash prioritization: Balance sheet maintenance Business investment Share repurchases Repurchase activity 903,301 shares, or 3.4% of outstanding AAWW stock, for $36.5 million Will continue to support AAWW 46
Continuous Improvement: CF6-80 Engine Program Purchases have deferred engine overhauls Surplus of passenger 747-400 aircraft Positive P&L and present value benefits Engine Overhaul Cash Flow Profile Status Quo Purchase T Zero Yr 1 Yr 2 Yr 3 Yr 4 Residual 5 Yr Net Cost Purchasing used aircraft can generate savings 47
Operating Leverage 1,150 1,100 1,050 Annual Block Hours (BH) 180,000 160,000 1,000 950 900 850 Unallocated Costs ($/BH) 140,000 120,000 800 2009 2010 2011 2012 2013 Est 100,000 Unallocated costs growing much slower than block hours 20% decrease in $/BH versus 2009 48
Tax Planning Increasing Profits and Cash Flow ETI tax benefit of $14.2 million in Q1 2013 $9 million of tax incentives from New York 49
Business Resiliency Fully operational Business Continuity site Fail-over data center State-of-the-art VoIP telecommunications and remote computing Cybersecurity that meets high-level DoD requirements 50
IT as a Competitive Difference What cargo What is onboard the Where current are and our operational how planes? is it being status? handled? Where are our planes? What is the current operational status? What cargo is onboard and how is it being handled? Real-time data enables rapid decision making and a transparent view of performance. 51
747-8F Benefits Common pilot-type rating Favorable financing Heavy maintenance honeymoon Warranties cover repair of major components for first four years Bonus depreciation 100% in 2011 & 2012 50% in 2013 1Q13 ACMI Direct Contribution up 65% 52
747-8F Permanent Financing Update 2012 record-low fixed-rate coupons of: 2.02%, 1.73%, 1.56%, and 1.48% Eighth placement (with Etihad) Ex-Im bond issued at: 1.83% In aggregate: $228 million in cash from deliveries Approximately 3% coupon and 4% all-in financing rates IRR in excess of 30% 53
Recognition of Landmark Ex-Im Financing Global Transport Finance Aircraft Debt Deal of the Year Award North America 54
Wrap-Up Bill Flynn President and Chief Executive Officer AAWW Investor-Analyst Day May 30, 2013
AAWW Key Takeaways Executing our plan, Resilient business model Operating income, cash flow strength driven by business mix, productivity gains, efficiency initiatives Full-year outlook affirmed Share repurchases, tax planning drive additional stockholder value Strong upside operating leverage 56
The future looks bright. Thank you.
Appendix
Reconciliation to Non-GAAP Measures For the Three Months Ended M arch 3 1, June 30, September 3 0, December 3 1, M arch 3 1, June 3 0, September 3 0, December 3 1, 2008 2008 2008 2008 2009 2009 2009 2009 Income (Loss) before Income Taxes $ (9,818) $ 6,389 $ 10,151 $ 103,499 $ 38,459 $ 17,838 $ 21,679 $ 46,121 Pre-tax impact from: Special charge * - - - 91,167 - - - 8,216 One-time maintenance charge - - - 8,186 - - - - Gain on issuance of subsidiary stock - - - (153,579) - - - - Gain on consolidation of subsidiary - - - - - (113) - - Terminat ion f ee f rom DHL - - - - (10,000) - - - Gain on early extinguishment of debt - - - - (2,713) - - - Loss (gain) on disposal of aircraft - (2,726) - - (957) - - - Adjusted Pre-tax Income (Loss) $ (9,818) $ 3,663 $ 10,151 $ 49,273 $ 24,789 $ 17,725 $ 21,679 $ 54,337 * Included in Special charge in 2009 and 2008 were costs related to the impairment of the 747-200 fleet. 59
Reconciliation to Non-GAAP Measures For the Three Months Ended March 31, June 30, September 30, December 31, March 31, June 30, September 30, December 31, 2010 2010 2010 2010 2011 2011 2011 2011 Income (Loss) before Income Taxes $ 53,891 $ 61,696 $ 55,224 $ 62,299 $ 16,686 $ 39,378 $ 45,807 $ 55,118 Pre- tax impact from: Special charge * - - - - - - - 5,441 Pre- operating expenses ** - 623 - - 3,766 3,940 4,126 5,298 Net accrual for legal settlements - 16,200 - (132) - - - - Litigation settlement received (8,750) - - - - - - - Loss (gain) on disposal of aircraft (1,222) (2,158) (161) (60) (120) (181) (163) 100 Adjusted Pre-tax Income (Loss) $ 43,919 $ 76,361 $ 55,063 $ 62,107 $ 20,332 $ 43,137 $ 49,770 $ 65,957 * Included in Special charge in 2011 were asset impairment and employee termination charges related to the retirement of the 747-200 fleet. ** Pre-operating expenses in 2011 and 2010 were related to the introduction of new aircraft types and included incremental costs incurred as a result of aircraft delivery delays. 60
Reconciliation to Non-GAAP Measures For the three months ended M arch 3 1, June 3 0, September 3 0, December 3 1, M arch 3 1, 2012 2012 2012 2012 2013 Income before Income Taxes $ 18,174 $ 50,102 $ 54,334 $ 82,665 $ 10,183 Pre-tax impact from: Fleet retirement costs* 1,453 1,637 196 249 - Loss (gain) on disposal of aircraft (196) (1,163) (1,058) - (23) Loss on extinguishment of debt - 142 143 291 - Insurance gain** - - - (6,329) - Adjusted Pre-tax Income $ 19,431 $ 50,718 $ 53,615 $ 76,876 $ 10,160 *Fleet retirement costs in 2012 included incremental employee costs related to the retirement of our 747-200 fleet. ** Insurance gain related to flood damage at a warehouse in 2012. 61
Reconciliation to Non-GAAP Measures For the Three Months Ended March 31, 2013 March 31, 2012 Net Cash Provided by Operating Activities $ 53,389 $ 18,088 Less: Capital expenditures 10,548 10,726 Capitalized interest 1,402 6,352 Free Cash Flow $ 42,439 $ 1,010 Weighted Average Diluted Shares 26,439 26,488 Free Cash Flow Per Share $ 1.61 $ 0.04 62
Reconciliation to Non-GAAP Measures 2011 Actual 2012 Actual Net Cash Provided by Operating Activities $ 142,958 $ 258,497 Less: Capital expenditures 37,374 31,266 Capitalized interest 27,636 18,727 Free Cash Flow $ 77,948 $ 208,504 Weighted Average Diluted Shares 26,422 26,549 Free Cash Flow Per Share $ 2.95 $ 7.85 63
Reconciliation to Non-GAAP measures In $Millions 2011A 2012A Debt $ 801.9 $ 1,350.8 Plus: 7X last twelve months' ("LTM") Aircraft rent 1,148.6 1,163.0 Less: Cash and cash equivalents (187.1) (409.8) Net Debt 1,763.4 2,104.0 LTM EBITDAR $ 359.6 $ 452.7 Net Leverage Ratio 4.9 4.6 Net Debt $ 1,763.4 $ 2,104.0 Less: Long-term investments and accrued interest (135.7) (140.5) Adjusted Net Debt 1,627.7 1,963.5 LTM EBITDAR $ 359.6 $ 452.7 Net Leverage Ratio (Including EETC Investment) 4.5 4.3 64