ASIAN SKY QUARTERLY THIRD QUARTER 2020

SPECIAL FEATURES S-92 FLEET CENSUS EXTRACT PRE-OWNED MARKET EMBRAER PHENOM 300 AIRCRAFT SPOTLIGHT HONDAJET ELITE

INTERVIEW ANDREA ZANETTO, CEO COMLUX AVIATION COMMENTARY HFW | RECOVERY OF BUSINESS AVIATION ASIA-PACIFIC OUTLOOK METRICS & MOOD ASIA-PACIFIC FLIGHT ACTIVITY MARKET SUMMARIES JETS & HELICOPTERS

THIRD QUARTER 2020 GLOBAL MARKET UPDATE GLOBAL JET CAPITAL \

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04 ECONOMICS 29 PRE-OWNED MARKET ANALYSIS Overview of the Asia-Pacific’s region current status and PHENOM 300 specific country’s GDP versus their business jet and A comprehensive market performance analysis of the pre- helicopter fleet size. owned Phenom 300 market.

10 MOOD & INTENTIONS 34 MARKET UPDATE Results of our survey on the Asia-Pacific region’s outlook on GLOBAL MARKET UPDATE Q2 | GLOBAL JET CAPITAL economic status, aircraft utilization, purchase intentions and An analysis of the global market, including commentary on influencing factors. the world economy, flight operations and OEM backlogs.

16 INTERVIEW 40 MARKET DYNAMICS ANDREA ZANETTO, CEO | COMLUX AVIATION An analysis of APAC inventory levels, market trends and the CEO of Comlux Aviation discusses the company’s aircraft changing price signals for the business jet and helicopter fleets. management division and the value it provides to owners and operators. 48 MARKET UPDATE GLOBAL MARKET UPDATE Q3 | AMSTAT 20 COMMENTARY An update on the value of pre-owned business jet market & LIFE BEYOND THE PANDEMIC | HFW turboprop market by Amstat. Chris O’Callaghan of HFW discusses the ways organizations are dealing with and managing through the pandemic. 50 MARKET ANALYSIS S92 FLEET CENSUS EXTRACT | Q3 2020 22 AIRCRAFT SPOTLIGHT An extract from Air & Sea Analytics’s market report on the HONDAJET ELITE S-92 Fleet during Q3 2020. A look at the HondaJet Elite -- designed with three distinct features to make this aircraft the most efficient in its class. 53 MARKET SUMMARY - JETS A look at market position and average days on market of 24 SPECIAL FEATURE featured pre-owned business jets. ASIA-PACIFIC FLIGHT ACTIVITY BY WINGX A look at Asia Pacific business jet flight activity from 70 MARKET SUMMARY – HELICOPTERS January 2020 through August 2020, including most popular A look at market position and average days on market of flight routes. featured pre-owned helicopters.

PUBLISHER matters to which information provided in this report or any other aspect of information contained. The may be relevant. information, data, articles, or resources provided by any other parties do not in any way signify that ASG ASG shall not be liable for any losses, damage, costs endorses the same. or expenses howsoever caused, arising directly or EDITORIAL & MARKET RESEARCH indirectly from the use of or inability to use this report Litalia Yoakum or use of or reliance upon any information or material ADVERTISING/AIRCRAFT SALES ENQUIRIES: Bowen Zhang provided in this report or otherwise in connection with [email protected] Maggie Gu any representation, statement or information on or DESIGN contained in this report. Michael Wong ASG endeavors to ensure that the information Asian Sky Group contained in this report is accurate as at the date Tel: (852) 9199 7751 of publication, but does not guarantee or warrant [email protected] The materials and information provided by Asian Sky its accuracy or completeness, or accept any liability www.asianskygroup.com | www.asianskymedia.com Group Limited (“ASG”) in this report is for reference of whatever nature for any losses, damage, costs only. Any information we provide about how we may or expenses howsoever caused, whether arising interpret the data and market, or how certain issues directly or indirectly from any error or omission in may be addressed is provided generally without compiling such information. This report also uses considering your specific circumstances. Such third party information not compiled by ASG. ASG information should not be regarded as a substitute is not responsible for such information and makes for professional advice. Independent professional no representation about the accuracy, completeness advice should be sought before taking action on any

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 1 PUBLISHER’S NOTE

The good news is that the toehold of a recovery we saw and hoped for last quarter is here to stay. Respondents to our quarterly survey are feeling better about their business prospects going forward and optimism continued its steep rise back for the 2nd quarter in a row. But as we all know “feelings” sometimes take a while to trickle down and for that optimism to manifest itself as tangible happenings on the ground.

So, the bad news is economies & their GDP, for now, continue to be hammered by the pandemic – from contracting 23.9% y-o-y in India to just -3.2% in South Korea. The only economies seemingly weathering the storm are Taiwan just -0.58% and China +3.2%. Not too surprising then, in our survey on the impact of Covid-19, even more respondents As always in our editions of Asian Sky Quarterly, also graciously said their businesses are being impacted somewhat or severely. providing us their views and backing them up with intel and hard data, Respondents see a higher chance of the market bouncing back in the are WINGX, Global Jet Capital and Amstat. So, please take a look. In 1st half of 2021 but, as far as 2020 is concerned, the year’s a bust with this issue we also go “small” putting the spotlight on two industry- no chance for business performance targets being met. leading aircraft: the Hondajet Elite and the pre-owned Phenom 300/E market. You’ll also find commentary by Chris O’Callaghan of HFW Similarly, we’ve seen a recovery in aircraft utilization - from the depths on Life Beyond the Pandemic; an interview with Comlux Aviation of despair in April, till today where we are still down but just a seemingly CEO – Andrea Zanetto, on the company’s business jet management modest 9%. Call it a “V” shaped recovery or a flattening of the curve, division; and an extract from Air & Sea Analytics’s market report on we’ll take it as the industry needs aircraft in the air. The recovery has the S-92 Fleet during Q3 2020. Lastly, we hear from AsBAA President mostly been driven by increased international travel too and leads by Jeff Chiang in our foreword, discussing the organization’s latest and a recovery in Chinese travellers and airports. upcoming events.

What this all means for business jet sales is probably best to describe We hope you find this issue informative and insightful. as “mixed”. There’s a slight optimistic uptick in purchase intentions of pre-owned aircraft (3%) but more aircraft are on the market for sale (4.1%), taking longer to sell, resulting in prices and ultimately values continuing to drop. From March through June and July values fell between 15% and 20% in the Heavy, Super-Mid and Medium Jet categories, although there was a slight recovery in August.

Year-to-date therefore transactions are down versus 2019 due to the economic effects of Covid-19. But the market activity has increased Sincerely, sequentially each month in the last quarter. Whether this trend Jeffrey C. Lowe will continue for the remainder of the year, remains to be seen but Managing Director, Asian Sky Group hopefully so.

SPECIAL THANKS TO OUR CONTRIBUTORS:

2 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 FOREWORD

Since our last update on Asian Sky Quarterly, the Asian Business Aviation Association (AsBAA) launched its Covid-19 resources portal on its website. Be sure to visit the page on the latest travel restrictions as well as helpful tips and information for those operating in the region. AsBAA will continue to publish updates through both its email digests and our Covid-19 resources portal in parallel for members as soon as we are made aware of policy changes.

This past quarter saw the AsBAA Malaysia Chapter busy engaging notable stakeholders in discussing business & general aviation (BA/ GA) industry developments. In July, the AsBAA Malaysia Chapter met with Invest Selangor to discuss a potential aviation event planned for 2021. In the same period, the Malaysian Investment Development Authority (MIDA) organized a business workshop at its headquarters Day” events held in Hong Kong, China, and Southeast Asia in the past in Kuala Lumpur to engage AsBAA Members and the BA/GA industry years. The Virtual Safety Summit greatly expands on the safety topics at large. The AsBAA Malaysia chapter was also recently featured on previously covered in our Safety Days. This year’s topics will cover MIDA’s website and on Malaysia’s top business and finance newspaper professional airmanship, human factors, accident investigation, flight/ The Malaysian Reserve. cabin crew training, safety culture, maintenance, flight data monitoring, weather, legal, and more. While social distancing measures in place The AsBAA China Chapter successfully resumed physical networking across the region have made it difficult to gather in large groups for activities in August with hosting the year’s first summer networking such an event, we look forward to hosting it physically again in the near cocktail in Beijing. Around 70 people, including several AsBAA Board future. Be sure to save the date and stay tuned for more updates on of Directors, the Business Aviation Service Branch of the Civil Airports our digests, social media, and AsBAA’s events calendar. Association of China, Aircraft Owners and Pilots Association (AOPA) China, the Aviation Cooperation Program (ACP) team, and media Stay healthy, stay safe, and we look forward to seeing you at our virtual representatives graced the event. These esteemed guests gathered events. to raise enthusiasm for the development of general and business aviation in China and to support AsBAA's role in advocating for such developments.

By the time you are reading this, AsBAA would have also just announced its inaugural regional Virtual Safety Summit 2020 to be held on 18-19 November 2020, in addition to a standalone webinar series to be Jeff Chiang introduced. Due to the ongoing pandemic, this year’s Safety Summit Chief Operating Officer will be conducted virtually and building on AsBAA’s signature “Safety Asian Business Aviation Association (AsBAA)

ABOUT ASBAA: AsBAA’s mission is to represent the needs of its members and the wider industry through its three core pillars: Advocacy, Representation and Community. The association actively advocates the benefits of business aviation to key stakeholders such as government, transport ministries and the media. It represents the interests of all sectors of the business and general aviation industry across the region, and creates a community in which members can network, access B2B opportunities, and tackle common issues with greater collective influence.

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 3 ECONOMICS ASIA-PACIFIC REGION CHARTER REPORT 2020 GREATER CHINA NOW AVAILABLE MAINLAND CHINA, HONG KONG, MACAU & TAIWAN

Mainland China GDP GROWTH (BILLION USD) The Chinese economy grew by 3.2% year-on-year (y-o-y) in the Mainland China Taiwan Hong Kong Macau second quarter of 2020, rebounding from a record 6.8% contraction in the previous three-month period. The country became the $13,608 $14,200 $12,835 $14,311 first major economy to report growth following the coronavirus $11,016 $11,138 $12,134 pandemic, as factories and stores reopened following months of coronavirus-induced restrictions. However, a continuing fall in retail $589 $605 $597 $589 trade underlined weakness in consumer spending and the need for $525 $531 $579 more support from Beijing to accelerate the economic recovery. $363 $335 $309 $321 $342 $362 $335 Hong Kong $45 $45 $51 $55 $50 $25 The Hong Kong economy declined 9% y-o-y in Q2 of 2020, after $8 contracting 9.1% in the prior period. The coronavirus pandemic was largely under control in May and June, and the recovery in mainland China has helped to partly offset the external headwinds 2015 2016 2017 2018 2019 2020Q1 2020Q2 facing Hong Kong's exports of goods. Private consumption declines moderated (-3.8% vs -7.2% in Q1) while government spending grew PURCHASING MANAGER’S INDEX

(1.8% vs 3.5% in Q1). Mainland China Taiwan Hong Kong Expansion

54.0% Taiwan 52.0% Taiwan's economy shrank 0.58% y-o-y in Q2 of 2020. This was the 50.0% steepest GDP contraction since the third quarter of 2009 as the 48.0% coronavirus pandemic hurt both domestic and external demand. 46.0% 44.0% Private final consumption slumped 4.98% (vs -1.55% in Q1) and Contraction 42.0% government spending declined 1.0% (vs 3.26% in Q1), while fixed 40.0% investment growth slowed to 2.73% from 6.32%.. 38.0% 36.0% 34.0% 32.0%

30.0% Aug19 Sep19 Oct19 Nov19 Dec19 Feb20 Mar20 Apr20 May20 Jun20 Jul20 Aug20 Jan20

Source: Focus Economics & Trading Economics

FLEET SIZE GROWTH: FLEET SIZE GROWTH: FLEET SIZE GROWTH: BUSINESS JET TURBINE HELICOPTER TURBOPROP Mainland China Taiwan Mainland China Taiwan Mainland China Taiwan Hong Kong Macau Hong Kong Hong Kong

719 752 313 344 338 332 679 184 184 321 581 157 164 495 133

135 135 129 122 129

10

27 27 29 5 5 5 25 4 4 24 27 25 24 22 21 4 3 2 11 23 2 10 10 10 19 9 17 15 15

2016 2017 2018 2019 2020Q3 2016 2017 2018 2019 2020Q3 2016 2017 2018 2019 2020Q3

* Data Source: ASG's Annual Business Jet Fleet Report and Helicopter Fleet Report. Turboprop data provided by Amstat.

4 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 ECONOMICS

AUSTRALASIA AUSTRALIA, NEW ZEALAND & PAPUA NEW GUINEA

Australia GDP GROWTH (BILLION USD) GDP fell 7.0% in seasonally-adjusted quarter-on-quarter terms in Australia New Zealand Papua New Guinea Q2, following Q1’s 0.3% decrease. On an annual basis, the economy slumped 6.3% y-o-y in Q2, contrasting Q1’s 1.6% expansion. The $1,352 $1,331 $1,432 $1,439 $1,446 $1,345 result marked the sharpest contraction on record and came in $1,210 below market expectations of a more moderate 5.9% contraction.

New Zealand $203 $205 $210 $205 $202 $177 $188 The economy nosedived 12.2% (q-o-q) during Q2 of 2020, following the first quarter’s 1.4% decrease. The reading marked the most pronounced contraction on record, and broadly matched expectations of a 12.8% plunge. On an annual basis, the economy $23 $24 $23 $23 $22 $21 $22 plummeted 12.4% in Q2, accelerating from Q1’s 0.1% dip and also marking the worst contraction on record. 2015 2016 2017 2018 2019 2020Q1 2020Q2

PURCHASING MANAGER’S INDEX

Australia New Zealand Expansion

60.0%

55.0%

50.0%

45.0% Contraction 40.0%

35.0%

30.0%

25.0%

20.0% Aug19 Sep19 Oct19 Nov19 Dec19 Feb20 Mar20 Apr20 May20 Jun20 Jul20 Aug20 Jan20

Source: Focus Economics & Trading Economics

FLEET SIZE GROWTH: FLEET SIZE GROWTH: FLEET SIZE GROWTH: BUSINESS JET TURBINE HELICOPTER TURBOPROP Australia New Zealand Australia New Zealand Australia New Zealand Papua New Guinea Papua New Guinea Papua New Guinea

428 433 432 431 853 855 869 410 199 197 832 181 186 185 808

539 553 511 462 478 19 19 19 16 15 58 54 56 49 51

28 28 4 4 4 104 116 103 107 93 23 23 3 3 22

2016 2017 2018 2019 2020Q3 2016 2017 2018 2019 2020Q3 2016 2017 2018 2019 2020Q3

* Data Source: ASG's Annual Business Jet Fleet Report and Helicopter Fleet Report. Turboprop data provided by Amstat.

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 5 ECONOMICS

EAST ASIA & CENTRAL ASIA JAPAN, SOUTH KOREA & INDIA

Japan GDP GROWTH (BILLION USD) The Japanese economy shrank 7.9% q-o-q in Q2 2020, after a 0.6% Japan South Korea India fall in Q1. This was the third straight quarter of contraction and the steepest on record, amid the severe impact of the COVID-19 crisis. $4,927 $4,860 $4,971 $4,881 $4,981 On an annualized basis, the economy collapsed at a record 28.1% $4,592 $4,389 y-o-y in Q2, compared with forecasts of a 28.6% slump.

South Korea $2,769 $2,899 $2,899 $2,935 $2,597 $2,274 South Korea’s GDP shrank 3.2% q-o-q in the three months to $2,095 June 2020 following a 1.3% drop in the previous period, entering $1,531 $1,619 $1,640 $1,614 $1,563 $1,378 $1,415 a recession due to the negative impact of the COVID-19. On an annual basis, the GDP fell by 2.7% after expanding 1.4 percent. This was the largest pace of contraction since the last quarter of 2008 as manufacturing sank 8.9%, mainly dragged by transportation equipment and computer, electronic & optical products. 2015 2016 2017 2018 2019 2020Q1 2020Q2

India PURCHASING MANAGER’S INDEX

The Indian economy shrank 23.9% y-o-y during Q2. This is the Japan South Korea India Expansion biggest contraction on record, as India imposed a coronavirus 60.0% lockdown in late March and extended it several times, halting most 55.0% economic activities. Still, India remains the third worst-affected country in the world by the pandemic. Construction (-50.3%), hotels 50.0% and transportation (-47%) and manufacturing (-39.3%) recorded the 45.0% biggest falls. In contrast, government consumption jumped 16.4% Contraction 40.0% as the government implemented relief measures to help curb the 35.0% impact of the pandemic. 30.0%

25.0%

20.0% Aug19 Sep19 Oct19 Nov19 Dec19 Feb20 Mar20 Apr20 May20 Jun20 Jul20 Aug20 Jan20

Source: Focus Economics & Trading Economics

FLEET SIZE GROWTH: FLEET SIZE GROWTH: FLEET SIZE GROWTH: BUSINESS JET TURBINE HELICOPTER TURBOPROP Japan South Korea India Japan South Korea India Japan South Korea India

679 155 155 646 664 647 646 134 138 140 140 138 140

97 94 92 78 78

73 76

63 62 54 54 55

302 286 291 287 285 21 21 19 21 19 19 16 16 17 17

229 233 231 222 227

2016 2017 2018 2019 2020Q3 2016 2017 2018 2019 2020Q3 2016 2017 2018 2019 2020Q3

* Data Source: ASG's Annual Business Jet Fleet Report and Helicopter Fleet Report. Turboprop data provided by Amstat.

6 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 ECONOMICS

SOUTHEAST ASIA THAILAND, MALAYSIA, SINGAPORE

Thailand GDP GROWTH (BILLION USD) Thailand's GDP shrank by 12.2% y-o-y in the second quarter of Singapore Thailand Malaysia 2020, following a revised 2.0% contraction in Q1. This was the worst economic downturn since the second quarter 1998, as both supply and demand took a hit from the pandemic crisis. Both private $474 $475 $471 $455 consumption (-6.6% vs 2.7% in Q1) and fixed investment (-8.0% vs $425 -6.5%) declined, and net external demand contributed negatively $412 $395 to GDP growth. Considering the first half of the year, the economy $364 $366 $358 shrank by 6.9%. $338 $356 $360 $308 $318 $354 $314 Malaysia $296 $297 $299 Malaysia's economy shrank by 17.1% y-o-y in the second quarter of 2020, the first contraction since the third quarter of 2009, and the $205 steepest fall since the fourth quarter of 1998; reflecting the negative impact of measures taken both globally and domestically to contain 2015 2016 2017 2018 2019 2020Q1 2020Q2 the spread of the COVID-19 pandemic. Household consumption slumped 18.5% (vs 6.7% in Q1), while fixed investment plunged PURCHASING MANAGER’S INDEX Singapore Thailand Malaysia

28.9% (vs -4.6% in Q1). Expansion

60.0% Singapore 55.0% Singapore's economy shrank 13.2% y-o-y in the second quarter of 2020. This was the steepest contraction on record as the COVID- 50.0% 19 crisis took a huge toll on the economy. GDP is now expected to 45.0% contract between 7% and 5% in 2020. Construction was the main Contraction 40.0% drag, plummeting 59.3%, against a 1.2% growth in Q1, explained by a 35.0% stoppage of most activities due to Circuit Breaker measures aimed to slow the spread of the virus. On a quarterly basis, the economy 30.0% shrank 42.9%, the most on record, after a 4.7% contraction in the 25.0% March quarter.

20.0% Aug19 Sep19 Oct19 Nov19 Dec19 Feb20 Mar20 Apr20 May20 Jun20 Jul20 Aug20 Jan20

Source: Focus Economics & Trading Economics

FLEET SIZE GROWTH: FLEET SIZE GROWTH: FLEET SIZE GROWTH: BUSINESS JET TURBINE HELICOPTER TURBOPROP Singapore Thailand Malaysia Singapore Thailand Malaysia Singapore Thailand Malaysia

64 63 62 60

57 56 59 57 161 44 154 157 153 155 40 42 54 28 25 25 118 122 33 34 106 111 111 19 18 48 9 9 8 6 40 5 38 38 37 4 6 6 6 5 35

2016 2017 2018 2019 2020Q3 2016 2017 2018 2019 2020Q3 2016 2017 2018 2019 2020Q3

* Data Source: ASG's Annual Business Jet Fleet Report and Helicopter Fleet Report. Turboprop data provided by Amstat.

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 7 ECONOMICS

SOUTHEAST ASIA INDONESIA & PHILIPPINES

Philippines GDP GROWTH (BILLION USD) The Philippine economy shrank a record 16.5% y-o-y in the second Indonesia Philippines quarter of 2020, the most since the series began in 1981. The $1,087 reading came above market expectations of a 9% decline as the $1,042 $1,016 $1,024 $1,041 coronavirus pandemic impacted businesses and consumers. $932 Private consumption slumped 15.5 percent (vs 0.2%) and fixed $862 investment contracted (-37.8% vs -4.4% in Q1).

Indonesia Indonesia's economy shrank by 5.32% y-o-y in the second quarter of 2020, worse than market consensus of 4.61 percent contraction. $376 $331 $338 It was the first contraction in the economy since 1999, as public $292 $305 $314 $327 health measures to contain the coronavirus crisis hit the economy. Household consumption fell 5.51% (vs 2.83% in Q1) and fixed investment decreased 8.61% (vs 1.70% in Q1). Government 2015 2016 2017 2018 2019 2020Q1 2020Q2 spending contracted 6.90% and external demand also contributed negatively to the GDP, as both exports and imports dropped. PURCHASING MANAGER’S INDEX Indonesia Philippines Expansion

60.0%

55.0%

50.0%

45.0% Contraction 40.0%

35.0%

30.0%

25.0%

20.0% Aug19 Sep19 Oct19 Nov19 Dec19 Feb20 Mar20 Apr20 May20 Jun20 Jul20 Aug20 Jan20

Source: Focus Economics & Trading Economics

FLEET SIZE GROWTH: FLEET SIZE GROWTH: FLEET SIZE GROWTH: BUSINESS JET TURBINE HELICOPTER TURBOPROP Indonesia Philippines Indonesia Philippines Indonesia Philippines

53

51 51 228 121 117 119 221 116

104 50 208 207 203 48 49 48 47 48

46 62 62 168 59 162 163 163 57 156 52

2016 2017 2018 2019 2020Q3 2016 2017 2018 2019 2020Q3 2016 2017 2018 2019 2020Q3

* Data Source: ASG's Annual Business Jet Fleet Report and Helicopter Fleet Report. Turboprop data provided by Amstat.

8 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 6X_StepInto_Manager_210x297_AS_uk.indd 1 21/09/2020 14:13 MOOD & INTENTIONS: ASIA-PACIFIC REGION SURVEY 2020Q3

RESPONDENT LOCATION Results Summary in 2020 Q3: Central Asia & Oceania (6%) Middle East (41%) 1. Good News: Pessimistic mood in APAC continued to stabilize in Q3; respondents from Greater China took the lead in terms of Rest of the World (11%) optimism levels. This was a major bounce back for the region’s optimism, reaching the highest levels since 2018 Q2 – 70%. Additionally, this quarter saw an uptick of respondents who believe market demand will bounce back in the first half of 2021. Greater + China (20%) 420 2. In Q3 2020, more respondents (vs. Q1 & Q2) reported that their RESPONDENTS businesses are still being affected and now have less hope that they will meet their business performance targets for 2020. 3. Many respondents’ domestic operation recovery performed SE & NE Asia (22%) better than their overseas, but 50% of the respondents still believed that their operations for both domestic and international 41+22+20116+G operations have not yet reached a point of recovery or cited “hard TOP 10 RESPONDENT’S LOCATIONS Australia (5%) Qatar (18%) to tell”. Singapore (5%) 4. A historically high 72% of respondents reported decreasing Philippines (5%) aircraft fleet utilization. United States (6%) India (14%) 5. A high level of respondents cited “not sure” when asked about purchasing an aircraft. Indonesia (6%)

In 2020 Q3, over 420 respondents participated in ASG’s survey regarding the mood Malaysia (6%) Hong Kong (13%) and intentions of the current business aviation market.

United Arab Emirates Regions with the most respondents include: (10%) China (12%) 1. Greater China (20%) 2. Southeast and Northeast Asia (22%) 3. Central Asia & Middle East (41%, incl. India, Pakistan, UAE, etc.) 4. Oceania (6%) 18+14+13121065+5+G The majority of the respondent’s aircraft type are business jets (67%). RESPONDENT AIRCRAFT TYPE Turboprop (18%) Business Jet (67%) 69% of the respondents from this quarter’s survey are from aircraft service providers (FBO, MRO, etc.) and aircraft operators, as well as from aircraft brokers (10%), aircraft end-users (3%) and respondents from other related areas.

Covid-19 Pandemic in the Asia Pacific

Civil Helicopter The pessimistic mood caused by Covid-19 in the Asia Pacific has eased as an (15%) economic rebound was seen in the Greater China market. This has, consequently, stabilized market mood as more respondents in Q3 believed that market demand will bounce back in the first half of 2021.

The ongoing pandemic has continued its impact on the business aviation industry. Companies are adjusting their business performance expectations and experiencing difficulty trying to recover their businesses. And, as suspected, domestic operations in the Asia Pacific have recovered quicker than overseas operations. RESPONDENT CATEGORY 67+15+18+G In this quarter’s survey, ASG added a new question asking respondents how their Owner / Aircraft Service Charter User (3%) Providers* (35%) domestic operations recovery compared with their overseas operations. The answers were consistent with our current understanding:

Broker (10%) • Over 30% of the respondents have not yet begun to experience business recovery; • Nearly no businesses are free from the impact of Covid-19; • Domestic business recovers quicker than overseas business.

Others** (18%) Aircraft Utilization Q3 experienced even less utilization of the regional fleet compared with Q2. Like Q2, all regions suffered from decreased fleet utilization due to Covid-19; 55% of the Aircraft Operator respondents reported their fleet utilization has decreased over 20% compared with /Management Company (34%) 2019 Q3. Once again, this marks the highest point of decreasing utilization levels 35+34+18103+G since the survey began. Purchase Intention

Aircraft purchase intention has been affected, as well. More respondents are now are not sure whether to purchase an aircraft. This comes as many brokers are hesitant * Aircraft Service Providers include: financial services, training, FBO, ground to define the market situation as well. ASG’s survey saw a drop in respondents handlers, Service, MRO, parts, etc. ** Others include law firms, research facilities and government official believing this is a ‘Buyer’s Market’ shifting to “I’m not sure”.

10 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 MOOD & INTENTIONS: ASIA-PACIFIC REGION SURVEY 2020Q3 ECONOMICS STATUS WHAT IS OUR CURRENT ECONOMIC STATUS? (QUARTERLY COMPARISON)

100% Past Low Point 90% 32% 20% 26% 52% 41% 38% 35% 19% 29% 32% 80% 52% 55% 56% 70% At Low Point

60% 29%

35% 43% Optimistic

29% 35% 28% 31% 32% (Will get better) 50% 27% 40% 32% 37% 28% 30% 34% Not Reached 37% Low Point 20% 33% 40% 53% 32% 36% 33% 45% 31% 10% 15% 16%

10% 11% Pessimistic 0% (Will get worse) 2017 2017 2018 2018 2018 2018 2019 2019 2019 2019 2020 2020 2020 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

OPTIMISM LEVELS SINCE 2017Q3 - REGIONAL DIFFERENCES Greater China SE & NE Asia Central Asia & Middle East Oceania Overall 100% 100% 95% 94% 95% 92% 92% 91% 92% 88% 89% 90% 89% 86% 90% 89% 88% 84% 84% 87% 86% 86% 85% 82% 82% 80% 83% 78% 80% 79% 75% 76% 75% 76% 73% 75% 74% 73% 70% 72% 70% 67% 69% 67% 67% 67% 68% 64% 65% 61% 63% 61% 60% 60% 58% 55% 56% 54% 50% 50% 48%

47% 43% 40% 40% 41% 36%

32% 30% 30%

20% 20%

10% 2017 2017 2018 2018 2018 2018 2019 2019 2019 2019 2020 2020 2020 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 11 MOOD & INTENTIONS: ASIA-PACIFIC REGION SURVEY 2020Q3 COVID-19: IMPACT ON ASIA PACIFIC

Has the COVID-19 coronavirus outbreak affected you Aircraft Operator / Management Company 2020Q1 2020Q2 2020Q3 Hard to tell at the moment 4% 2% 1% or your organization’s business so far? No, it has not affected my business 7% 0% 1% 2020Q1 2020Q2 2020Q3 Yes, it has seriously affected my business 65% 75% 79% Yes, it has somewhat affected my business 24% 22% 20% 72% 68% 63% Aircraft Owner / Charter User 2020Q1 2020Q2 2020Q3 Hard to tell at the moment 12% 0% 0% No, it has not affected my business 12% 0% 0% Yes, it has seriously affected my business 54% 76% 92% Yes, it has somewhat affected my business 23% 24% 8% 27%28% 25% Aircraft Sales / Charter Broker 2020Q1 2020Q2 2020Q3 Hard to tell at the moment 6% 1% 3% 6% 4% 3% 1% 1% 1% No, it has not affected my business 1% 4% 3%

- Yes, it has seriously affected my business 62% 67% 76% Yes, it has somewhat affected my business 30% 27% 18%

Other Related (FBO, MRO, etc.) 2020Q1 2020Q2 2020Q3 Hard to tell at the moment 5% 2% 1% business business business affected my my affected the Moment Hard to tell at tell to Hard No, it has not not it has No, No, it has not affected my business 3% 1% 1% - seri It has Yes, Yes, It has some It has Yes, what affected my my affected what ously affected my my affected ously Yes, it has seriously affected my business 62% 67% 75% Yes, it has somewhat affected my business 30% 30% 22%

Do you foresee market demand bouncing back in the Aircraft Operator / Management Company 2020Q1 2020Q2 2020Q3 Hard to tell at the moment 33% 39% 43% 2nd half-year of 2020/1st half year of 2021? No 36% 37% 32% 2020Q1 2020Q2 2020Q3 Yes 30% 24% 25% 40% 38% Aircraft Owner / Charter User 2020Q1 2020Q2 2020Q3 36% 36% 34% 34% Hard to tell at the moment 27% 38% 33% 29% 30% No 62% 38% 33% 24% Yes 12% 24% 33%

Aircraft Sales / Charter Broker 2020Q1 2020Q2 2020Q3 Hard to tell at the moment 20% 21% 9% No 57% 51% 64% Yes 23% 28% 27%

Other Related (FBO, MRO, etc.) 2020Q1 2020Q2 2020Q3 Hard to tell at the moment 41% 36% 34% No Yes No 34% 27% 27% Yes 25% 37% 39% the Moment Hard to tell at tell to Hard

Are you or your organization still optimistic to meet Aircraft Operator / Management Company 2020Q1 2020Q2 2020Q3 Hard to tell at the moment 35% 37% 38% the business performance targets you set for 2020? No 23% 26% 27% 2020Q1 2020Q2 2020Q3 Yes 41% 37% 35% 42% 38% Aircraft Owner / Charter User 2020Q1 2020Q2 2020Q3 35% 35% Hard to tell at the moment 42% 14% 8% 33% 32% 33% No 38% 43% 58% 27% 25% Yes 19% 43% 33%

Aircraft Sales / Charter Broker 2020Q1 2020Q2 2020Q3 Hard to tell at the moment 39% 33% 28% No 19% 25% 40% Yes 42% 42% 33%

Other Related (FBO, MRO, etc.) 2020Q1 2020Q2 2020Q3 Hard to tell at the moment 33% 37% 37% No Yes No 25% 26% 26% Yes 42% 37% 37% the Moment Hard to tell at tell to Hard

Rank the following factors that you think are critical to the future of business aviation / general aviation: Value for Price Paid More Important Factors Overall Rank Score (the lower the better)

Privacy Value for Price Paid 1 2.6 Cabin Sanitation Cabin Sanitation 2 2.7 Customer Service 3 2.8 Flexibility / Punctuality 4 3.1 Maintenance Support 5 3.9 Maintenance Support Customer Service Privacy 6 4.2

Flexibility / Punctuality

12 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 MOOD & INTENTIONS: ASIA-PACIFIC REGION SURVEY 2020Q3

In terms of your current level of business recovery, your domestic business volume compares to your over- seas business volume: Domestic and overseas operations have Domestic business recovery is Hard to tell Not affected by COVID-19 not started to recover better than overseas business Overseas business recovery is better than domestic business

Aircraft Operator / Management Company 22% 32% 25% 2% 20%

Aircraft Owner / 11% Charter User 33% 33% 22% 11%

Aircraft Sales / Charter Broker 30% 26% 22% 22%

Other Related 32% 34% 20% 14% (FBO, MRO, etc)

PURCHASE INTENTION WHERE ARE WE IN THE CURRENT PRE-OWNED MARKET? PURCHASE INTENTION 2018Q3 - 2020Q3*

Buyer’s Market Balanced Market Seller’s Market I’m not sure Yes, a new aircraft Yes, a pre-owned aircraft No / I’m not sure 66% 59% 62% 58% 58% 55% 53%

43% 54% 46% 41% 50% 43% 48% 49% 38% 41% 38% 38% 38% 28% 20% 21% 22% 32% 18% 30% 26% 16% 17% 28% 27% 28% 14% 15% 13% 13% 27% 26% 10% 12% 13% 31% 29% 15% 22% 22% 11% 24% 25% 8% 9% 8% 8% 5% 5% 6% 20% 20% 19%

2018Q3 2018Q4 2019Q1 2019Q1 2019Q3 2019Q3 2020Q1 2020Q2 2020Q3 2018Q3 2018Q4 2019Q1 2019Q1 2019Q3 2019Q3 2020Q1 2020Q2 2020Q3

PURCHASE INTENTION - REGIONAL DIFFERENCES (FIXED WING)

Corporate Airliner Large Jet Medium Jet Small Jet Turboprop / Piston Fixed Wing SE & NE Asia 13% 17% 33% 17% 21%

Oceania 20% 40% 20% 20%

Greater China 11% 45% 30% 8% 6%

Central Asia 36% 26% 16% 10% 12% & Middle East

PURCHASE INTENTION PURCHASE INTENTION - HELICOPTER PURCHASE DECISIONS - FIXED WING (OUTER IS PREFERRED) - INFLUENCING FACTORS (OUTER IS PREFERRED) (OUTER IS LIMITING) Corporate Airliner Twin Turbine Government / Public Opinion (Such as ACJ, BBJ) (Such as Sikorsky S-76C++) Most Preferred

Most Preferred Inconvenient No Interesting to Use Turboprop/Piston Large Jet Aircraft Fixed Wing (Such as G650, (Such as King Air Series) Falcon 8X)

Piston Helicopter Single Turbine Helicopter No Need Price Small Jet Midsize Jet (Such as Robinson R22) (Such as Bell 206) Greater China Oceania (Such as Citation Series, (Such as G200 & Central Asia SE & NE Asia Hawker Series) CL650)

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 13 MOOD & INTENTIONS: ASIA-PACIFIC REGION SURVEY 2020Q3

FLEET UTILIZATION

SUMMARY: AIRCRAFT UTILIZATION CHANGES COMPARED TO 12 MONTHS AGO

100%

Up by 20% and more (>20%) 13% 90% INCREASED 80% 12% SAME 70% Up but less than 20% (0 - 20%) 3%

60% 17%

50% The same (0%) 40%

30% DECREASED 55% Down but less than 20% (-20 - 0%) 20%

10% Down by 20% or more (<-20%) 0% 2018 2018 2019 2019 2019 2019 2020 2020 2020 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

Decreased The Same Decreased The Same GREATER CHINA Increased Signal Line* OCEANIA Increased Signal Line*

OPTIMISTIC OPTIMISTIC

PESSIMISTIC PESSIMISTIC 90% 81% 77% 77% 71% 62% 58% 57% 56% 55% 50% 48% 47% 45% 43% 43% 41% 42% 36% 33% 33% 32% 30% 30% 31% 29% 26% 26% 26% 25% 25% 25% 25% 25% 24% 24% 23% 22% 22% 21% 21% 19% 18% 17% 16% 13% 15% 13% 10% 8% 7% 6% 4% 0% 2320182255 2018 4324332019 4120193326 43622019 2118 3621 2019 5817252020 772020158 2020 1677 817 6 13 2620181956 2018 3025452019 2620193242 2019 2448292019 2520202550 2020 1330572020 477190 2240 312510 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

SOUTHEAST & NORTHEAST ASIA Decreased The Same CENTRAL ASIA & MIDDLE EAST Decreased The Same Increased Signal Line* Increased Signal Line*

OPTIMISTIC OPTIMISTIC

PESSIMISTIC PESSIMISTIC 79% 72% 71% 70% 68% 67% 67% 65% 64% 60% 61% 60% 60% 56% 51% 50% 48% 44% 40% 40% 39% 36% 38% 34% 29% 28% 25% 23% 22% 22% 22% 21% 18% 19% 17% 17% 16% 15% 15% 15% 14% 13% 12% 11% 11% 11% 10% 5% 5% 4% 2% 4% 1% 0% 1420182264 2018 2518562019 1720192360 2019 1517682019 3420202244 2020 2821512020 486071 1210 403929 2220181167 2018 41966 20195 20191679152019 570112019 11 20206515 202013 72412020 616010 42 503638 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3

* An Optimistic-Pessimistic Signal Line has been added to regional aircraft usage trend analyses for Greater China, Oceania and South and East Asia regions. An optimistic mood is derived from more people indicating ‘higher’ aircraft utilization compared with 12 months ago, while a pessimistic mood is derived from more people indicating ‘lower’ aircraft utilization compared with 12 months ago.

14 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 Business aviation financing. \ For those who value simplicity.

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844.436.8200 \ [email protected] \ globaljetcapital.com THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 15 INTERVIEW: COMLUX AVIATION ANDREA ZANETTO, CEO

Since 2003, Comlux has supported VIP clients through its business jet management division – Comlux Aviation. Elevating its service level, the division offers excellence through high standards of safety and quality. Leading Comlux Aviation is CEO, Andrea Zanetto – a 10-year veteran of the company - who spoke with Asian Sky Group about his journey in aviation, his vision for the management division, and supporting clients in challenging times.

WHEN DID YOU GET STARTED IN AVIATION? Comlux Aviation is the aircraft management and charter division of Comlux based in Malta, Europe. Since I joined, we have created new I started to love aircraft very young; at 12 I was building my first AOC like the successful in Aruba and developed the Malta and the aircraft models. At 18, I went to take my glider pilot licence and I Kazakhstan ones. We have welcomed 22 new aircraft types including decided to study aeronautical engineering at the university. My first wide bodies, long-range VIP aircraft but also small and mid-size jets job was at Embraer in Brazil in the aerodynamics section working for regional use, and we increased our worldwide operation footprint. on wind tunnel experiments. I joined the air transport world with More importantly, we increased our customer base by listening to a start-up charter company in Italy, working in the engineering them, understanding their needs and requirements, and providing department. I spent my days in the office and my nights in the bespoke solutions, customised to each customer profile. hangars and on the ramp to learn more about aircraft and those involved in aviation. Eventually, I ended up at Comlux. In January 2011, I joined as CEO of Comlux Aviation. We increased our customer base by listening to them, HOW HAS COMLUX EVOLVED SINCE YOU FIRST JOINED? understanding their needs

Comlux started in 2003 in Switzerland as an aircraft management and requirements, and company of business jets. When I joined as the CEO of Comlux providing bespoke solutions, Aviation, the vision to create a one-stop-shop Group leader in the VIP Aviation was already in place and I had the opportunity to contribute customised to each to this development. customer profile.

16 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 Comlux Completion is our completion and maintenance division, based in Indianapolis, US. Comlux Transactions is our aircraft sales & acquisition division based in Zurich, Switzerland.

The three divisions work seamlessly to provide customers the services that they need, whether it is about a new aircraft purchase, a new cabin or a refurbishment, the private or commercial operations of their aircraft, or charter solutions. The synergies among the three units allow the customers to get a single professional and efficient interface for all his/her needs in VIP aviation.

CAN YOU TELL ME MORE ABOUT THE MANAGEMENT DIVISION?

Comlux Aviation is headquartered in Malta and has three AOC: Malta, Aruba, Kazakhstan. We have commercial offices based in Malta, Zurich, Almaty, Hong Kong, Moscow, Dubai, Miami, to serve our customers’ needs in their local regions and time zones.

We offer management services in complete and partial packages; As of today, Comlux Aviation manages 22 aircraft: 12 types, catering to both private and commercial operations regardless of the 8 manufacturers. type. Our goal is to provide solutions that are highly tailored to meet the clients’ needs and desires. • Airbus (ACJ330, ACJ318, ACJ319, ACJ320neo) • Boeing BBJ (737, 767, 777) Our Malta office houses all services in-house which allows for efficient INTERVIEW: COMLUX AVIATION and timely operations. Continuing Airworthiness Management, • Bombardier (CL604/CL605/CL650, CL850, G6000) Dispatch and Flight Planning, Crew Control and Travel, Charter Sales • Dassault (Falcon 7X) and Client Services, and Finance are co-located at our headquarters. ANDREA ZANETTO, CEO • Embraer (Legacy 650) We are particularly proud of our ability to seamlessly support • Pilatus (PC-24) operations from light and mid-size jets to wide-bodies. The foundation of our operation is a highly knowledgeable and technical • Sukhoi (SBJ-100) team supported by a strong safety and compliance culture. Comlux • Textron (Hawker 900XP) Aviation is one of the few operators in the world approved as a Stage 3 IS-BAO Operator.

WHAT FACTORS SHOULD BE CONSIDERED WHEN SELECTING A MANAGEMENT COMPANY?

Full trust & understanding. Attention to detail and optimising costs. Efficient & digital reporting.

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 17 COMMENTARY: COMLUX AVIATION

HOW HAVE YOU SUPPORTED YOUR CLIENTS suitable actions. The team had to work much more for every single THROUGHOUT COVID-19? flight due to the new variables coming up almost every day. Also, we had to adapt to a temporary work from home during the lockdown, Our clients have looked initially for safe solutions for their crew and a new situation which was successfully managed through modern aircraft to be taken care of during the lockdown period. We launched digital IT systems which were in place at Comlux for some time. actions defining rules for the crew to stay healthy and safe and adopting measures for aircraft either by hangarage or parking for maintenance or storage. WHAT SETS THE COMLUX AIRCRAFT MANAGEMENT DIVISION APART FROM Regarding the travel needs of our customers, we have been OTHER MANAGEMENT COMPANIES? supporting them in finding the most adequate travel plan and Our approach enhances the personalized service to each customer. following-up with the changes in travel plans and restrictions put in Our human-size fleet allows us to consider each and every request place by each country. During each flight, our Crew carefully cleans individually and to be extremely proactive in providing solutions or the aircraft interior, wear masks and adopt the distanciation required alternatives. We have a continuous improvement approach to cost to allow the passenger to maximize his/her personal space and control and have a dedicated Procurement Director to negotiate in comfort on board. the best interests of our clients. Finally the safety standards we have put in place through our SMS and ISBAO stage 3 approval, our In terms of the charter business, we have supported several operation and financial transparency towards our customers make passengers repatriations and we also performed a high number of us different on the way we manage their assets and allow them to cargo flights thanks to our VIP wide-body fleet which is capable of get the most of it. carrying outstanding quantities of cargo in the aircraft holds.

VIP and Business Aviation have proven to be the right choice to stay WHAT ARE YOUR HOPES FOR THE FUTURE healthy and safe while traveling during these challenging times. OF COMLUX?

Finally and most important, we are offering a unique upgrade by Comlux has become a strong and mature player, ready for the next installing a ionization system which cleans the air from virus, bacteria challenges of our markets. We foresee the opportunity to develop and odors prior and during the flight. We have already some of our more in the regions where VIP and Business Aviation will make the clients successfully making use of the system. difference. Specifically, Asia with growing needs to connect countries and people with immense territories.

HOW HAVE YOU HAD TO ADAPT YOUR WAYS www.comlux.com/aviation OF WORKING WITH CLIENTS THROUGHOUT THIS PERIOD?

Customers were asking all sorts of questions and we had to learn how to get the correct information, get the right answer, and take

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THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 19 LIFE BEYOND THE PANDEMIC THE CHALLENGE OF ADAPTING OR BECOMING IRRELEVANT

As the world entered the start of 2020, few could have imagined let alone foreseen the way in which the year would unfold. From the early stages of infection, the speed at which the coronavirus pandemic erupted across the globe resulted in unprecedented disruption to the global business landscape. While this led to an initial spike in charter activity for business aviation, the resulting challenges for the aviation sector as a whole have been well-documented. Organisations had to change at pace and with agility, as many of the previous ways of working were not fit for purpose. They were confronted with the very real challenge of adapting or becoming irrelevant, or worse still disappearing completely.

et as we now enter second half of the year, many organisations • Business Confidence – all are looking at the emerging ‘next have increased their speed of decision making, accelerated normal’ with a level of confidence. Conversations have suggested Ytheir technological advances, embraced new or alternative confidence in their cash position with some suggesting that they ways of working and are engaging and collaborating with colleagues are well positioned to take advantage of the current situation – and customers in a new, more inclusive manner. hinting at an increase in acquisitions.

• Workforce Management – whilst for some there is a recruitment Over the past couple of months, we have had the opportunity to meet freeze, for others they are reporting a significant uplift in with a number of prominent General Counsels and members of the recruitment activity, with one respondent (in the shipping industry) executive teams of both regional and multi-national corporations commenting that they have not experienced such an increase in from across Asia, the Middle-East and Europe, across a wide variety of new hires for many years. None of those spoken to were, at the industries, including aviation. These discussions have provided first- time, suggesting that redundancies were being considered. There hand insights into the ways in which organisations are dealing with, is also an emerging view that in order to enhance organisation managing through and starting to emerge from the pandemic. efficiencies, a degree of structural “flattening” will occur. This is as much to do with removing bureaucracy as it is in ensuring the SUMMARY FINDINGS: appropriate deployment of labour. • Agile working – there is a mixed view emerging on the future Whilst for many businesses the challenging economic environment is of working. Some are suggesting that they will embrace a more causing or starting to cause operational difficulties, what became clear agile approach whilst others are expecting the “normal” office from these conversations was a genuine (and in some ways) unexpected environment not to change. There are definite cultural differences level of positivity about the future. This sentiment was largely shared and traditional/emerging sector splits in how this is being viewed. from across industry and geography, and whilst it did differ slightly at organisational level, the following emerged: • Digitalisation – for many the digital transformation journey had already commenced with a roadmap stretching over the next • Diversification – most businesses are looking at some form couple of years. Rather than dampening this strategic direction, of diversification – either through establishing completely new organisations have accelerated their digital transformation, income streams or changing their focus to alternative ways of diverting funds and resources to enable rapid change. What delivering the same services. However whilst several we spoke digitalisation means though differs between organisations. to reference stopping major investments, others are continuing to develop parts of their business where they have seen recent Whilst there was a fair degree of alignment on these areas, there were profitability. The view on discretional spend remains varied with a number of additional points which reflected the different stages of some diverting funds to core strategic projects, whilst others business recovery – including the impact on supply chains, oil price continue with their pre-pandemic growth plans. decline, and labour availability as well as health and safety concerns.

20 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 COMMENTARY: LIFE BEYOND THE PANDEMIC BY HFW

Of these the most challenging, and potentially of greatest concern to the focus currently on liquidity. While some businesses will inevitably the future business environment, was the reference made to the impact face difficulties, for others there will be opportunities. the pandemic was having, or at least starting to have, on entrepreneurs What the next normal will look like, and whether business will indeed and start-ups. Whilst the start-up world remains buoyant, several take the opportunity to change direction or revert to the previous norm, references were made to the slow trickle of talent moving away from remains unclear. However there is a sense that the business world is the more risk-facing start-up environment to roles in-company where gearing up to emerge ready and capable to deal with the opportunities those individuals had gained greater a sense of security. Whether this of life beyond the pandemic. is a long-term change or one which we simply see as a direct impact from the pandemic is too early to tell. Either way, organisations should If you would like a copy of the full research paper, please contact embrace these alternative thinkers and encourage them to develop Chris O’Callaghan, Director of HFW Consulting at innovation internally. [email protected].

IN CONCLUSION

The word ‘unprecedented’ has been used almost continually during this year to describe the world in which we are living. Business leaders have HFW CONSULTING needed to stand up, make some brave decisions and admit the failings HFW Consulting is working with clients around of the organisations they lead, yet the world continues to operate. Of the world to help them develop their businesses, course we need to be mindful of the impact of further waves of Covid- enhance their people and protect against risk. We 19, and the business world will watch as markets react to the impact understand that being successful in an increasingly of these. As for the future? competitive market requires organisations to be In time what we remember about this passage of time will be as collaborative, agile and innovative, supported by much about the resilience, and tenacity, of business as it will be about systems and processes that inform, enable and political reactions. Taking a moment to reflect not only on the current deliver a competitive advantage. Our global team business but those around us will prove invaluable to ensure that should we be faced by such a challenging environment again, business of consultants, lawyers and risk specialists have continuity plans can be dusted off, revisited and re-used. more than 25 years’ experience supporting clients across our core sectors: Aerospace; Commodities; The business world is at a critical decision point. It would be easy to simply to turn left and revert to what was; but to turn right, and direct Construction; Energy; Insurance and Shipping. efforts to embrace a world where agility and pace goes hand in hand with ambiguity and risk could, for those prepared to take it, result in new or alternative opportunities. CHRIS O’CALLAGHAN Director of Consulting Finally, what emerged from our discussions was a growing level of D: +44 (0)20 7264 8775 optimism that there is light at the end of the tunnel, but it is also E: [email protected] inevitable that this optimism will not be shared by all businesses as the true cost of the pandemic is realised in the times ahead. Business aviation, like commercial aviation, has faced a tough few months, with

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 21 AIRCRAFT SPOTLIGHT: HONDAJET ELITE

In December 2003, the Honda Aircraft Company took itself to new heights with the first flight of its own Honda HA-420 HondaJet. The compact business jet joined Honda’s range of products for land and sea, a vision that was 30 years in the making for the company. After years of research and development, the first HondaJet was delivered to a European buyer in 2016.

The original HondaJet was advertised as the fastest, highest-flying, engine is located at the rear of the fuselage. An additional advantage quietest, and most fuel-efficient jet in its light jet class. The aircraft of this unique feature is the allowance of more cabin space – making came to market featuring three distinct characteristics intended to the HondaJet one of the roomiest of its class with the largest make the HondaJet the most efficient aircraft available. baggage capacity.

One of its most prominent features is the Over-The-Wing Engine Another distinct characteristic is the Honda-developed Natural Mount (OTWEM) configuration, said to reduce aerodynamic drag, Laminar Flow (NLF) Wings and Nose design. The laminar flow, which which ultimately leads to faster flight speeds and greater fuel is essentially the flow of uninterrupted air streaming from the noise efficiency. This is unlike the engine of most business jets, where the to the wings, contributes to reduced wind drag even at high speeds and is also a contributing factor in the speed and fuel efficiency.

The HondaJet also incorporates a composite fuselage, unlike the traditional aluminum fuselage of most business jets. Another factor in fuel efficiency and increased cabin space, the composite fuselage also translates to a reduced manufacturing process.

Another distinct characteristic is the Honda-developed Natural Laminar Flow (NLF) Wings and Nose design.

22 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 AIRCRAFT SPOTLIGHT: HONDAJET ELITE

SPECIFICATIONS

PERFORMANCE

MAXIMUM CRUISE SPEED @ 422 KTAS FL300MAXIMUM CRUISE ALTITUDE FL430 RATE OF CLIMB 4100 FT / MIN NBAA IFR RANGE (4 OCCUPANTS) 1437 NM

In May 2018, the HondaJet Elite was unveiled. The Elite model TAKEOFF DISTANCE <3500 FT LANDING DISTANCE <3000 FT incorporates the original, key innovations – the OTWEM configuration, the Natural Laminar Flow design , and a composite ENGINES fuselage. In addition to these original technologies, the Elite is MANUFACTURER / MODEL GE HONDA / HF120 further defined enabling the aircraft to fly farther with less noise OUTPUT (UNINSTALLED THRUST) 2050 LBF EACH pollution. Powered by the GE Honda Aero Engines HF120 producing DERATED FROM 2095 LBF EACH over 2,000-pounds of thrust, the Elite can fly 1,437 nautical miles BYPASS RATIO 2.9 (2,661 km) and has a maximum cruising altitude of 43,000 feet EXTERIOR DIMENSIONS (13,106 miles). LENGTH 42.62 FT [12.99M] WING SPAN 39.76 FT [12.12M] The ergonomically designed cockpit is enhanced with more HEIGHT 14.90 FT [4.54 M] safety features and a customized Garmin® G3000 avionics suite, INTERIOR DIMENSIONS which includes three 14.1-inch high-definition displays and two touchscreens. In the cabin, passengers can enjoy a full-service LENGTH 17.80 FT [5.43 M] WING SPAN 5.00 FT [1.52 M] galley, a private lavatory with optional belted seat and the exclusive HEIGHT 4.83 FT [1.47 M] Bongiovi sound system. The cabin seats four passengers, which are each set on a ball-joint system, enabling the seats to be easily BAGGAGE SPACE moved forward, backward and sideways. Cabin controls are also COMBINED STOWAGE 66 CUBIC FT AFT COMPARTMENT 57 CUBIC FT left up to the passengers with a touchpad controller, making it easy NOSE COMPARTMENT 9 CUBIC FT to control lights, audio, climate and more. CONFIGURATION

The price of the HondaJet Elite is around US$5.2 million. Owners TYPICAL CONFIGURATION 1 CREW + 6 PAX (2 CREW + 5 PAX) can choose one of three exterior colors: Ice Blue, Monarch Orange, ALTERNATIVE CONFIGURATION 1 CREW + 7 PAX (2 CREW + 6 PAX) or Ruby Red.

The first deliveries of the HondaJet Elite were made in December 2019, after the aircraft received its type Chinese certification from the Civil Aviation Administration of China (CAAC) in August 2019. HondaJet sales support in China is provided by Honsan General Aviation Co., Ltd.

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 23 SPECIAL FEATURE ASIA-PACIFIC FLIGHT ACTIVITY 2020 JAN-AUG

WINGX is a data research and consulting company, which provides actionable market intelligence to the global business aviation industry. Our interactive web-hosted dashboards provide our customers with the data-visualization they need to stay alert to market trends, keep tabs on market share, identify competitive threats and spot new sales opportunities. WINGX customers include aircraft operators, airframe, engine and avionics OEMs, airlines, maintenance providers, airports, fixed-based operators, satcom providers, fuel providers, legal advisors, leasing companies,

banks, regulators, investors and private jet users. WINGX Data Source: ADSB and ATC For further information and a free demo of our dashboards, please DATA BY contact: Richard or Christoph at [email protected]

24 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 SPECIAL FEATURE: ASIA-PACIFIC FLIGHT ACTIVITY 2020 JAN-AUG

ASIA PACIFIC BUSINESS JET FLIGHT ACTIVITY JANUARY 2020 - AUGUST 2020 TOTAL FLIGHTS FROM APAC (DEPARTURE + ARRIVAL INTERNATIONAL FLIGHTS VS. DOMESTIC FLIGHTS FLIGHTS) 9.3% 2% -9% -29% -16% -37% -52% -69% 2020 Q2 40%, 20,925 60%, 30,767

14,654 13,006 11,267 9,919 9,226 8,544 2020 Q1 51%, 19,583 49%, 19,115 6,225 4,527

0 10,000 20,000 30,000 40,000 50,000 60,000 Jan Feb Mar Apr May Jun Jul Aug Domestic Flights International Flights 2020 Flights YoY Trend 2020 JAN-AUG BUSIEST REGIONS (DEPARTURE) DEPARTURES BY DATE

350 300 250 200 150 100 50 0 Jan Feb Mar Apr May Jun Jul Aug 2019 Dep. 2020 Dep.

FLIGHT DURATIONS 8000 7000 6000 5000 DEPARTURE AREA FLIGHTS YOY GROWTH RATE Mainland China 4401 -32% 4000 India 4241 -11% 3000 United Arab Emirates 3892 -11% 2000 Saudi Arabia 3327 -33% 1000 Japan 2782 -18% 0 Israel 1905 -36% Jan Feb Mar Apr May Jun Jul Aug Kazakhstan 1849 -5% Max 30 min. 30 min. to 1 hours 1 to 2 hours 2 to 3 hours Hong Kong 1638 -15% Malaysia 1619 -25% 3 to 4 hours 4 to 5 hours More than 5 hours Thailand 1399 -9%

With the third quarter of 2020 just concluding in August, the total The Covid-19 situation in Mainland China improved during Q2, number of business aviation flights departing from the Asia-Pacific which led to Mainland China’s position as the top business aviation region since January was 38,698; declining by 25%, compared with market in APAC from January to August. the same period in 2019. With the Covid-19 pandemic worsening globally in Q2, there was a dip in activity coinciding with a series Over the past eight months, the proportion of domestic flights was of travel quarantines. By the end of Q2, business aviation flight higher than international flights. APAC countries have, for the most activity recovered with flights in APAC increasing each month since part, opened up their economies, and consequently, tourism has Q2: from 9,919 in July to 11,267 in August. seen a boost. Short-range flights within 2 hours now make up the majority of the business aviation activity, accounting for 58%.

*Changes in May to June flight activity reflect the use of additional data sources by ** Unless otherwise noted, all numbers are compared on a year-on-year basis. WINGX and, thus, more accurate flight activity numbers. January to August numbers *** Oceania flight traffic consists only of flights arriving into Asia. used in this analysis represent the latest data as of September 2020. Data Source: WINGX

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 25 SPECIAL FEATURE: ASIA-PACIFIC FLIGHT ACTIVITY 2020 Q3

TOP AVIATION HUBS’ PERFORMANCES GREATER CHINA PERFORMANCE 2020 JAN - AUG GREATER CHINA FLIGHT ACTIVITIES BY SIZE CATEGORY

1398 205, -30% 1134

849 184, 781 821 670 -50% 570 461 109, 88, 3,581, -46% 2,443, 6% 45% -39%

48, -35% Jan Feb Mar Apr May Jun Jul Aug Ultra Long Range Jet Heavy Jet Light Jet Super Midsize Jet Mainland China Taiwan Macau Hong Kong Super Light Jet Airliner / Bizliner Midsize Jet

There were a total of 6,684 business jet departures in Greater China Flights utilizing ultra-long-range jets saw a significant decline during until the end of August 2020, falling 32% compared with the same this period, falling more than 70%, however, the utilization of large- period of 2019. cabin jets only declined by 14%. This is attributed to the role of medical and cargo flights in the time of Covid-19. In the super-light jet category, During these eight months, 4,401 flights departed from Mainland the number of flights was up 45%, with the use of the Cessna-Citation China in total. Flights departing from Hong Kong fell 15%, flights from Excel/XLS models contributing to the increase. Taiwan fell by 48%, and flights from Macau shrank significantly by 68%.

2020 JAN-AUG DEPARTURE BY CITY

FROM BEIJING FROM SHANGHAI Flights: 880 Flights: 809 -17% YoY Rate: -50% 29% YoY Rate: -26% -32% 26% -54% -20% -63% -64% 1% -53% -69% -51% 201 -43% -67% -70% -60% 165 167 172

105 119 95 92 103 85 81 81 56 57 55 55

Jan Feb Mar Apr May Jun Jul Aug Jan Feb Mar Apr May Jun Jul Aug

FROM GUANGZHOU FROM HONG KONG Flights: 343 Flights: 1638 YoY Rate: -2% YoY Rate: -15% 27% 45% 16% 0% 36% 14% -3% -16% -10% -33% -3% -33% -30% 334 -45% 67 -42% 57 254 270 -58% 47 49 40 185 186 156 29 30 139 24 114

Jan Feb Mar Apr May Jun Jul Aug Jan Feb Mar Apr May Jun Jul Aug

During the Covid-19 period, the key transport hubs in Mainland China - Since the outbreak of the third wave of Covid-19 in Hong Kong in Beijing, Shanghai, and Guangzhou - saw a substantial drop in the first mid-July, a number of social distancing rules were put in place by the four months. May saw the overall market edge further towards recovery. government to prevent the spread of the virus. Flight activity in July saw a sudden drop, falling by 33% YoY.

* Unless otherwise noted, all numbers are compared on a year-on-year basis. Data Source: WINGX

26 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 SPECIAL FEATURE: ASIA-PACIFIC FLIGHT ACTIVITY 2020 JAN-AUG

2020 JAN-AUG DEPARTURE BY CITY FROM TOKYO FROM SINGAPORE Flights: 825 Flights: 1154 YoY Rate: -42% 27% 28% 7% YoY Rate: -48% -19%

-58% -50% -56% -54% -50% -59% 305 218 222 -70% -73% -56% -79% 248 -68% -88%

94 140 139 79 62 105 96 46 52 52 82 39

Jan Feb Mar Apr May Jun Jul Aug Jan Feb Mar Apr May Jun Jul Aug

Japan has also been seriously affected by the pandemic. The total threefold increase compared to the beginning of the month. Departures number of flights departing from Tokyo during these eight months was from Singapore were down 48%, compared to the same period in 2019. 825, falling by 42%. Coronavirus cases in Japan started to surge again in June and July. As of August 18th, there were 243 severe cases, a

2020 JAN-AUG ASIA PACIFIC BUSINESS JET FLIGHT ACTIVITIES TOTAL FLIGHT ACTIVITIES BY SIZE CATEGORY TOP OEM PERFORMANCE COMPARISON YOY%

Airliner / Bizliner, -79%, 1,896 Very Light, 59%, 1,111 Entry Level, -64%, 4 245,273% Super Light, 74%, 1,199 850, -54% Super Midsize, -26%, 2,662 940, -46% 1536, 26%

Light, -2%, 3,076 2218, 61% Flight Large Cabin, 3401, -33% -28%, 1,2576 4035, -18% Midsize, 16%, 3,567 4054, 0% 10161, -38% 10965, -26% Ultra Long Range, -70%, 1,2578

Honda Boeing Airbus Learjet Hawker Beechcraft Dassault Embraer Cessna Gulfstream Bombardier

TOP 10 DESTINATIONS

In terms of business jet activities by OEM: Bombardier and Gulfstream still dominate the business aviation market, with a total of 21,126 flights. 1488 1290 Activity in the ultra-long-range and large-cabin categories account for 66% of the regional business jet movements. However, the mid-size and 957 869 847 817 817 807 super light-size categories showed strong growth. 688 650

Hong Kong became the second top aviation hub in the Asia-Pacific region throughout this eight month period, with 1,290 flights arriving into Hong Kong. Tokyo Beijing Riyadh Subang Mumbai Jebel Ali Bangkok Shanghai New Delhi Hong Kong

* Unless otherwise noted, all numbers are compared on a year-on-year basis. Data Source: WINGX

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28 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 PRE-OWNED MARKET ANALYSIS EMBRAER PHENOM 300

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THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 29 PRE-OWNED MARKET ANALYSIS: EMBRAER PHENOM 300

MODEL INTRODUCTION

Embraer’s Phenom 300 is known as one of the best-selling light jets in the cockpit are predictive wind shear, warning pilots of wind shear on the market. The Brazilian aircraft manufacturer developed the conditions, and Emergency Descent Mode, as well as pilot and co-pilot model to accommodate owners and operators who enjoyed the very- seat tracking that’s close to 40% more, thus providing more legroom in light Phenom 100, but also wanted something slightly larger. Thus, the the cockpit. 300 was born – making its first flight in 2008 and its first delivery in 2009. Since then, the aircraft has been delivered to over 530 owners In the cabin, passengers can now enjoy even quieter travel as noise- and operators around the world, in addition to being deemed one of the reduction improvements have been made to reduce high-frequency most successful business jets of the 2010s. noise. Also, a brand-new premium interior option is available, known as Bossa Nova – inspired by the sidewalks of Rio de Janeiro. The Phenom 300 is known for its performance, comfort and technology, made even better with the introduction of the ‘enhanced’ Phenom 300E MODEL COMPARISON model in 2018 and a further update to the ‘E’ model in 2020. Model Phenom 300

The latest update delivers a high-speed cruise of 464 knots and a five- Production Period 2008 - 2019 occupant range of 2,010 nautical miles with the capability of reaching Engine Type PW535 Mach 0.80 speeds, making it the fastest and longest-range of a single- Engine Thrust (lb) 3,360 pilot business jet. The Phenom 300E is powered by PW535E1 engines Maximum Range (Long-Range Cruise) (nm.) 1,974 (replacing the PW535E turbofan engines of the original model), with Maximum Take-off Weight (lb) 18,497 thrust increased to 3,478 lbf (from 3,360 lbf). Normal Cruise (kts) 430 Passengers and Crew 7 Pax / 2 Crew In the cockpit, the 300E boasts improved avionics with the Garmin G3000 Prodigy Touch Flight deck. One of the more notable features is Cabin Width (FT.) 5.08 the Runway Overrun and Awareness Alerting System (ROAAS), designed Cabin Height (FT.) 4.92 to act as an additional pilot and warns if the aircraft’s approach is too Cabin Length (FT.) 17.17 steep or too fast, increasing situational awareness; a useful feature Cabin Volume (CU.FT.) 324 for the aircraft particularly as the cause of many light jet accidents Total Variable Cost/Hour 2,740 are long landings and overruns. This technology has been patented by

Embraer and is said to be a first in business aviation. Additional features Data Source: Conklin & de Decker FLEET DISTRIBUTION

Since its maiden flight, the Phenom 300 has enjoyed excellent reception The United States has over 370 Phenom 300 models currently in in the marketplace and in March 2019 was delivered to its 500th operation. And its top operators like NetJets, are noteworthy for their customer. Since 2013, Embraer has delivered over 60 units every year. fractional ownership program and leasing / Jet Card programs, which make use of light-size jets, such as the Phenom 300. Currently, NetJets The top 5 countries operating the Phenom 300 are the US, Brazil, operates over 80 Phenom 300s in North America, making it the largest Germany, Portugal and France, operating a combined 88% of the Phenom 300 operator in the world. worldwide fleet. In the Asia-Pacific, the Phenom 300 is not as popular with only 10 aircraft (2 Phenom 300E) models, which reflects the REGIONAL DISTRIBUTION regional preference of large cabin. Though this is a perfect aircraft for Phenom 300 Phenom 300E short-haul flights, the Phenom 300’s smaller cabin and limited luggage capacity likely do not satisfy the needs of Asia-based end users – who N. America usually fly long-haul, international routes. W. Europe DELIVERY & AGE DISTRIBUTION S./C. America Phenom 300 Phenom 300E Rest of the World 80 70 71 0 100 200 300 400 70 65 500th Delivery 60 60 TOP 5 OPERATING COUNTRIES 48 48 49 50 Total Fleet Average Age (years) 38 39 40 United States 372 3.8 30 24 24 Brazil 63 3.9 20 Germany 31 3.8 13 Portugal 17 4.1 10 2 2 2 France 11 4.2 0 % Total Fleet 88% 2017 2016 2010 2014 2011 2015 2019 2013 2018 2012 2009 2008 2020 Data Source: Amstat

30 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 PRE-OWNED MARKET ANALYSIS: EMBRAER PHENOM 300

PRE-OWNED MARKET ANALYSIS

Over half of the Phenom 300 models in operation have been used The market demand for Phenom 300 currently is strong and stable; for over 5 years, which means the pre-owned market is now alive each month since 2015 there have been 3-5 transactions completed. and active. Since early 2018, we have seen the inventory value (total However, as more Phenom 300 options are available on market, it now market value of fleet for sale) of the pre-owned Phenom 300 begin to takes a bit longer time to sell. Thus, the average days on market has increase from US$100M to the current value of over US$250M. The increased to around 250 days. number of aircraft for sale has increased from around 15 in 2015 to nowadays over 30 on market and publicly for sale. CURRENT MARKET SNAPSHOT Average Days Currently, the fleet of Phenom 300/E model on market for sale For Sale % of Total Fleet on Market represents 6.3%/1.8% of the total fleet. The inventory level is below the Phenom 300 28 6.3% 265 market average (7-8%). According to Amstat, many owners/operators Phenom 300E 2 1.8% 104 upgraded to the Phenom 300 from their Phenom 100, or Pilatus PC-12 Combined 30 5.4% 256 models. And, many will consider selling their Phenom 300 for an upgraded 300E model or other Legacy models.

PHENOM 300 AVERAGE ASKING PRICES & FLEET FOR SALE INVENTORY VALUE TREND Phenom 300 Aircraft for Sale Phenom 300E Average Asking Phenom 300 Inventory Value Phenom 300E Inventory Value Asking Price Regression 8.5 50 300 45 8 M USD

M USD 40 250 7.5 35 30 200 7 25 20 150 6.5 15 6 10 100 Inventory Value Inventory Average Asking Price Average 5 Sale for # of Fleet 5.5 0 0 Jan-17 Jan-17 Jan-16 Jan-16 Jan-15 Jan-19 Jan-15 Jan-19 Jan-18 Jan-18 Jan-20 Jan-20 Sep-17 Sep-17 Sep-16 Sep-16 Sep-15 Sep-19 Sep-15 Sep-19 Sep-18 Sep-18 Sep-20 Sep-20 May-17 May-17 May-16 May-16 May-15 May-19 May-15 May-19 May-18 May-18 May-20 May-20

MARKET TRANSACTIONS DAYS ON MARKET Phenom 300 Transactions Phenom 300E Transactions Aircraft in Operation 9 600 450 8 500 400 7 6 400 350 5 300 300 4

Transaction 3 200 250

2 Aircraft in Operation 100 200 1 0 0 15 Jan-17 Jan-17 Jan-16 Jan-16 Jan-15 Jan-19 Jan-15 Jan-19 Jan-18 Jan-18 Jan-20 Jan-20 Sep-17 Sep-17 Sep-16 Sep-16 Sep-15 Sep-19 Sep-15 Sep-19 Sep-18 Sep-18 Sep-20 Sep-20 May-17 May-17 May-16 May-16 May-15 May-19 May-15 May-19 May-18 May-18 May-20 May-20

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 31 PRE-OWNED MARKET ANALYSIS: EMBRAER PHENOM 300

VALUE DEPRECIATION: PHENOM 300 (2010 VS. 2015) % Annual Depreciation: 2010 % Annual Depreciation: 2015 2010 2015 10,000 -30%

9,000 -25% 8,000

7,000 -20%

6,000

Residual Value (,000 USD) Value Residual -15% Annual Depreciation Rate (%) Annual Depreciation Rate 5,000

4,000 -10%

3,000 -5% 2,000

1,000 0% 2017 Q2 2017 2017 Q4 2017 2017 Q3 2017 2017 Q1 2017 2016 Q2 2016 2016 Q4 2016 2016 Q3 2016 2016 Q1 2016 2010 Q2 2010 Q2 2014 2010 Q1 2010 Q2 2010 Q3 2010 2010 Q4 2010 Q4 2014 2010 Q3 2010 Q3 2014 2014 Q1 2014 2011 Q2 2011 2011 Q4 2011 2011 Q3 2011 2011 Q1 2011 2015 Q2 2015 2015 Q4 2015 2015 Q3 2015 2015 Q1 2015 Q2 2019 2019 Q4 2019 2019 Q3 2019 2019 Q1 2019 2013 Q2 2013 2013 Q4 2013 2013 Q3 2013 2013 Q1 2013 Q2 2018 2018 Q4 2018 2018 Q3 2018 2018 Q1 2018 2012 Q2 2012 2012 Q4 2012 2012 Q3 2012 2012 Q1 2012 SA20_See You_210x297mm_ASQ.pdf 1 11/3/2020 11:40:05 AM

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2020 started off on a stable path. Overall transaction dollar volume was up compared to 2019, and inventories were increasing – but only gradually. However, as COVID-19 spread and social distancing measures were implemented, the industry entered a forced hiatus. Flight operations dropped off, OEMs disrupted production and deliveries to protect their workforces, and pre-owned transactions slowed as simple acts like viewing an aircraft became complicated. Following year-over-year lows for almost all key metrics in April, flight and transaction activity increased through the quarter, although they remain low when compared to 2019.

• After dropping 75 percent year-over-year in April, flight • Despite low transaction volume, the number of aircraft listed operations have gradually improved through Q2 2020. Flights for sale remained stable throughout the first half of 2020, in May were down 51 percent from a year earlier and June resulting in only gradual increases in inventory. flights were down 24 percent, a very positive trend. Overall, • Unlike in the financial crisis of 2008, there has not been a Q2 2020 flights were 50 percent lower than Q2 2019. substantial systemic decline in aircraft residual values during • Following a strong 2019 and a highly disrupted first half the early stage of the COVID-19 pandemic. Uncertainty has of 2020, the major OEMs have seen a collective 9 percent reduced reliable data and kept both buyers and sellers on the Q2 year-over-year decline in backlog. Despite this drop-off, sidelines. As people gain confidence, buyers will return to the overall backlog remains just under $30B, which represents a market and may further stabilize prices. strong position for the industry. Despite all major indicators trailing 2019 levels and a general sense • New and pre-owned transactions for the quarter were down of uncertainty, month-over-month improvements throughout the 36 percent by unit volume and 37 percent by dollar volume second quarter provide rationale for cautious optimism regarding versus the same period last year. Following a low in April, the future state of the business aviation market. transactions did pick up month-over-month through Q2.

34 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 Special Feature on the Global Economy The following commentary comes from Jason Thomas, Managing Director and Head of Global Research for The Carlyle Group.

1. The global economy took another step forward in 5. The global information technology sector avoided July. Aside from a conspicuous virus-related drop contraction in Q2-2020 with staffing needs and revenue in U.S. household spending, virtually every other expectations largely unchanged from January amid Indicator we construct from portfolio company exponential growth in demand for communications data improved this month, albeit at uneven rates equipment and software. The strength of business-to- across industries and geographies. Relative to June, business software and related services has also kept nearly 85% of the Indicators either strengthened or overall U.S. business spending well above levels that remained on the same trajectory. would be implied by tangible business equipment orders. IT’s strong performance partially explains the apparent 2. The U.S. Commerce Department estimates that disconnect between fundamentals and asset prices, as the U.S. economy contracted at a -33% annual rate the industry’s contribution to U.S. stock market indexes in Q2-2020. This number shouldn’t be taken too (and broader investment opportunity set) is nearly twice seriously. Average U.S. GDP during Q2-2020 was the size of its contribution to U.S. GDP. -9.5% below year-ago (Q2-2019) levels and -10.6% below the Q4-2019 business cycle peak, roughly 6. According to EuroStat, the euro zone economy consistent with the -11% drop estimated from our contracted by -12% in Q2-2020 (not annualized), with data. Annualizing quarterly changes in activity average GDP in the quarter -15.3% below the Q4-2019 provides a sense of the annual growth rate that business cycle peak. It is no surprise that the initial would be obtained if the economy remained on the drop in GDP was much greater in Europe than the same trajectory for the next nine months. Obviously, U.S., as more draconian lockdowns resulted in steeper such extrapolation is inapt in this circumstance given declines in fuel consumption. But, as we highlighted that the lockdown-induced contraction ended at the last month, Europe seems poised to outperform for start of May. the rest of the year with few signs of any of the virus- related setbacks observed in the U.S. 3. Averages, in this case, can also be misleading. “Experiences” spending on travel, tourism, live events 7. Fuel consumption increased by 9% in Europe in July, and lodging remains massively depressed and took defying the drop observed in the U.S., while retail a step back in July due to heighted consumer risk and restaurant foot traffic rose by 10% to 20%. The aversion and a partial rollback of reopening in several rebound in foot traffic did nothing to dent online sales, states. After two months of recovery, U.S. passenger which continue to grow at impressive rates. Industrial enplanements declined in July and finished the orders also continue to rebound, with overall volumes month down -78% relative to year-ago levels. Rising now down just -4% relative to year-ago levels. coronavirus caseloads also slowed the recovery in 8. Despite these encouraging signs, it is worth noting hotel occupancy rates (45% of rooms occupied in that overall retail sales showed no signs of sequential July; and seated dining, with month-end traffic down improvement in July, with year-over-year sales down -60% year-over-year. A large and growing share of -2%, roughly unchanged relative to June. Average “temporary” business closures have now become spend per visitor declined this month, as the initial permanent. Thankfully, new cases in the U.S. seem pent-up demand showed signs of ebbing. The 40% to to have stabilized, with clear signs that the epidemics 50% occupancy rates will also take a toll on southern raging in Arizona and Texas have begun to wane. Europe where tourism accounts for 15% to 25% of 4. On the other side of the divide are industries that have GDP, with much of it concentrated in Q3-2020. Spain’s either rebounded since April or never experienced a economy entered Q3-2020 down -22% relative to year- decline in the first place. Health care spending, which ago levels. accounted for one-third of the Q2-2020 contraction 9. We observed blistering sequential growth in India over in GDP due to the sharp decline in “elective” surgeries the past two months, with logistics volumes and overall and medical procedures and visits to dentists and goods movement rising well above year-ago levels after doctors’ offices, continues to rebound, with revenues falling by nearly -80% during the country’s lockdown. and staffing nearly back to pre-pandemic levels. Residential real estate has responded to the drop in 10. After two months of disappointment, Chinese retail interest rates with construction materials orders up sales and foot traffic both rose in July. Consumer 3x from their March lows. Even energy development spending finished the month down -5% year-over-year, spending, which remains depressed relative to pre- compared to -8% in Q2-2020. Foot traffic rebounded pandemic levels, showed signs of life in July with a even more, finishing July down -5% relative to -20%, statistically significant improvement relative to June on average, in Q2-2020. Auto sales also rose and have even as renewed lockdowns caused overall U.S. now averaged 6% annual growth since April. Industrial gasoline demand to fall in July. orders remain above year-ago levels and property development spending strengthened this month.

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 35 Q1 2020 – GLOBAL MARKET UPDATE

FLIGHT OPERATIONS GLOBAL BUSINESS JET OPERATIONS U.S. Rest of World

1.11 M 1.15M 1.12M 1.11 M 1.15M 1.13M 1.14M 1.15M 15.0% 16.1% 15.7% 14.6% 15.1% 16.3% 16.0% 14.5% 1.00M 14.7% 85.0% 83.9% 84.3% 85.4% 84.9% 83.7% 84.0% 85.5% 85.3%

2018 Q2 2018 Q3 2018 Q4 2019 Q1 2019 Q2 2019 Q3 2019 Q4 2020 Q1 2020 Q2

Global business jet flight operations (defined as a takeoff and landing The recovery in business jet flights is largely being driven by by the FAA) appeared to continue their steady growth from 2019 charter and fractional operators, who are seeing demand from new into early 2020, increasing 1.2 percent year-over-year in January customers to the business jet market looking to avoid potentially and February. However, the outbreak of COVID-19 disrupted global crowded airports and commercial airlines. Many business jet flight operations, leading to a 9.7 percent year-over-year decline for operators have implemented “nocontact” flights for their passengers, the quarter. Flights dropped by 75 percent year-over-year in April. while there can be up to 700 touchpoints on a commercial flight.ii However, by May flights began to recover, increasing 97 percent from Barring further outbreaks of COVID-19, flight operations are expected the low point in April. Flights were still 51 percent lower than in May to continue to increase. 2019. June flights increased 45.2 percent from May and were down 24.2 percent from June 2019. Overall, Q2 2020 flights were 50.4 percent lower than Q2 2019.

OEM BACKLOGS Q2 BACKLOG AT MAJOR BUSINESS JET OEM’S

Bombardier Gulfstream Dassault Cessna Embraer

$31,474 $32,531 $29,541

USD Millions

2018 Q2 2019 Q2 2020 Q2

Backlogs at major business jet manufacturers declined 9.2 percent In the near term, orders for new aircraft will likely remain low as a in Q2 2020 as companies dealt with the COVID-19 pandemic and result of COVID-19 and the efforts to contain it, putting downward ensuing social distancing policies. Most manufacturers had a pressure on backlogs. At the same time, manufacturers, which were difficult time closing deals since potential customers could not meet in a strong position at the end of 2019 following high orders for new with company representatives or inspect aircraft. Even as markets models, have not experienced a rash of cancellations. Furthermore, began to open, interest has been stable, but sales remain difficult to reduced production levels could stabilize backlogs despite lower close due to travel restrictions. This has resulted in lower backlogs order intakes. for most OEMs. On a company level, some OEMs, such as Dassault and Gulfstream, were more stable than others, primarily due to strong performance in 2019.

36 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 Q2 2020 – GLOBAL MARKET UPDATE: GLOBAL JET CAPITAL

TRANSACTIONS BUSINESS JET TRANSACTIONS New Pre-Owned

$8.8B $807B $7.3B (952 Units) $6.8B $6.9B (1003 Units) (843 Units) $6.0B $5.8B (760 Units) (738 Units) $5.1B $4.3B (709 Units) 44.6% (629 Units) 39.2% (605 Units) (490 Units) 46.9% 41.1% 38.9% 48.9% 43.1% 46.0% 39.7% 60.8% 53.1% 55.4% 61.1% 51.1% 56.9% 58.9% 54.0% 60.3%

2018 Q2 2018 Q3 2018 Q4 2019 Q1 2019 Q2 2019 Q3 2019 Q4 2020 Q1 2020 Q2

YOY% CHANGE IN TRANSACTION $ VOLUME Q2 2020 MONTH-BY-MONTH PERFORMANCE $1.1B 60% (147 Units) 40% 28.7% 20% $0.7B 0% (100 Units) -20% $0.4B 40.8% -40% (79 Units) 71.3% -60% 53.6% 59.2% 46.4% 2019 Q1 2019 Q2 2019 Q3 2019 Q4 2019 2020 Q1 2020 Q2 2018 Q2 2018 Q3 2018 Q4 2018 April May June The outbreak of COVID-19 has had a substantial impact on business Between April 2020 and June 2020, transactions increased jet transactions. While transaction value was down in January and sequentially, rising from $869 million in April to $2 billion in June. February, unit volume was up 6.6 percent compared to the same Sequential increases through Q2 are a typical dynamic for business period in 2019, setting the stage for a stable year with potential jet transactions and a sign that the market may normalize once the upside in 2020. COVID-19 threat abates.

However, after the World Health Organization (WHO) officially declared COVID-19 a global pandemic on March 11, 2020, business jet transactions declined. As nations implemented social distancing and “stay-at-home” orders, it became difficult to conduct the necessary activities to buy and sell aircraft (e.g. inspect the aircraft, travel to a location to deliver or pick up the aircraft, etc.). Furthermore, many business jet OEMs and suppliers shut down or slowed operations, delaying new deliveries. In Q2 2020, transactions declined 35.5 percent, while transaction value declined 37 percent.

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 37 Q2 2020 – GLOBAL MARKET UPDATE: GLOBAL JET CAPITAL

FOR-SALE INVENTORY YTD AIRCRAFT LISTED FOR SALE PERCENT OF BUSINESS JET FLEET FOR SALE

1298 1283 Total 0-12 Years 13+ Years 14% 12% 10% 8% 6% 4% 2% 0% 2019 2020 Aircraft listed for sale is an early indicator of owner / operator 2019 Q1 2019 Q2 2019 Q3 2019 Q4 2019 2018 Q2 2018 2018 Q3 2018 Q4 2018 2020 Q1 confidence. Even though transactions have been low, aircraft listed 2020 Q2 for sale has remained stable compared to 2019. Throughout 2020, the average number of aircraft listed for sale per week has been As far back as early 2019, inventory levels have been gradually 48, with a peak of 61 in early May. For comparison, as the Great increasing from historical lows in 2018. As a result of these steady Recession took hold in 2008, new listings averaged 70 per week with increases, inventories are now hovering around historical averages. peaks of 106, 115 and 120. One reason for the steady listings may be Despite the disruptions associated with COVID-19, we are yet to see that aircraft owners are waiting to see how the COVID-19 pandemic a significant jump in 2020. It is worth noting that inventory aircraft plays out and what effect it will have on the economy before deciding younger than 13 years old, typically seen as more desirable, continue what to do with their business jets. It also suggests that owners are to be low at only 7.9 percent of the global fleet. not strained financially and thus are able to hold onto aircraft through the crisis.

RESIDUAL VALUE YOY % VALUATION CHANGE

1.3% 1.1% 1.6% 0.1%

-1.5% -2.6% -4.1% -4.6%

-7.5% -8.4%

-13.2% -14.3% 2009 Q2 2010 Q2 2011 Q2 2012 Q2 2013 Q2 2014 Q2 2015 Q2 2016 Q2 2017 Q2 2018 Q2 2019 Q2 2020 Q2

The above chart compares the year-over-year percentage change in crisis and even the disruptions to the business jet market in 2016 the bluebook value of like-aged aircraft over time (e.g., the difference and 2017 following the decline of commodity values. Some of that between value of an eight-year-old aircraft from one year to the stability is due to lower transaction activity as both buyers and sellers next). Global Jet Capital analyzes a basket of aircraft as a proxy for reduced market activity in the early stages of the pandemic. As more the overall market. Observed increases or decreases in value are transactions have been recorded, data has become more available, not necessarily applicable to any specific aircraft make/model. For making it possible to draw initial conclusions on value trends. Large the value of a specific aircraft, please contact a licensed aircraft and ultra-long-range jets have declined in value, while the value of appraiser. smaller and medium jets has been more stable. Uncertainty remains a major factor in the market, both in making data analysis difficult With a 1.5 percent decline in Q2 2020, business jet bluebook values and in keeping buyers and sellers on the sidelines. As buyers gain have remained relatively stable through the early stages of the confidence in the future, more will reenter the market and prices COVID-19 outbreak, especially when compared to the 2008 financial should stabilize and possibly even firm up.

38 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 Q2 2020 – GLOBAL MARKET UPDATE: GLOBAL JET CAPITAL

CONCLUSION

Following the outbreak of COVID-19 and the ensuing social distancing Interested in learning more about the flexible financing options measures, the business jet market was forced into a hiatus. Although available for obtaining a business aircraft? Global Jet Capital’s the market decline began in Q1, the full effects of the outbreak financial products are designed to help you optimize your were not felt until Q2. Beginning in April, both flight operations and private aviation experience across the lifetime of the asset— transactions experienced steep declines. Market activity has begun from acquisition to disposition and upgrade. Whether your to slowly increase since April but has not yet reached levels seen goal is to free up capital or to enable the flexibility to transition in 2019. Flight operations have improved the most among market between aircraft, we work tirelessly to understand your needs indicators as people look for ways to travel while avoiding large and provide straightforward and highly responsive solutions. crowds. Transactions have also improved but remain below 2019 levels. Residual values have seen modest declines while inventory Visit www.globaljetcapital.com to learn more. has seen gradual increases.

Due to mixed market data as well as uncertainty surrounding the path of COVID-19, the near-term future of the business jet industry remains opaque. The future will likely play out along a number of different scenarios, largely correlated to the path of the COVID-19 pandemic. Still, month-over-month improvements throughout the second quarter provide a reason for optimism regarding future market activity.

i U.S. FAA vi JetNet and Global Jet Capital analysis. Units are in parentheses ii Bloomberg vii Amstat and Global Jet Capital Analysis iii Company financial reports. viii JetNet and Global Jet Capital Analysis iv JetNet and Global Jet Capital analysis. Units are in parentheses ix Aircraft Bluebook and Global Jet Capital analysis v WHO

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 39 MARKET DYNAMICS PRE-OWNED BUSINESS JETS MARKET - 2020 Q3

INVENTORY VALUE (USD)1

WORLDWIDE $7,377M $7,591M

$1,502M ASIA PACIFIC

=

$909M

Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep 2017 2018 2019 2020

The Inventory Value Line represents the number of aircraft actively being marketed for sale in USD terms.2

The Trend Line represents the market’s direction in terms of the balance between sellers and buyers (supply and demand) at today’s price levels. A rising Trend Line indicates that pre-owned activity is stabilizing, with sellers of aircraft increasingly likely to find buyers.

The Signal Line represents an indication of where the market’s direction may be heading in the future. A Signal Line consistently falling below the Trend Line indicates that any improvement in the market’s direction may not be entirely sustainable.

MARKET TREND1 WORLDWIDE

TREND WORSENING TREND REVERSAL

MOVING TOWARDS SELLER’S MARKET

MOVING TOWARDS BUYER’S MARKET

1 AIRCRAFT SOLD 80 WORLDWIDE 73

59 55 55 56 51 47 49 42 45 45 45 47 40 40 41 42 43 38 40 38 35 36 36 33 32 29 31 30 30 30 26 28 23 22 15

Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep 2017 2018 2019 2020

1 The historical inventory value and transactions are subject to change based on latest market information updates. 2 ASG’s Inventory Value line is calculated by taking the total number of aircraft for sale from a selection of 39 different models, multiplied by their average asking prices. Source: AMSTAT & ASG 40 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 MARKET DYNAMICS

WORLDWIDE % OF FLEET SOLD

1.10% 1.05% 1.00% 0.95% 0.90% 0.85% 0.80% 0.75% 0.70% 0.65% 0.60% 0.55% 0.50% 0.45% 0.40% 0.35% 0.30% 0.25% 0.20% 0.15% Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep 17 17 18 18 18 18 18 18 19 19 19 19 19 19 20 20 20 20 20

AVERAGE ASKING PRICE

28

26 ASIA PACIFIC

MILLION USD 24

22

20

18 WORLDWIDE

16

14

12

10 Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep 17 17 18 18 18 18 18 18 19 19 19 19 19 19 20 20 20 20 20

% OF FLEET FOR SALE

12%

11%

10%

9% ASIA PACIFIC

8%

7%

4% WORLDWIDE 5%

4%

3% Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep 17 17 18 18 18 18 18 18 19 19 19 19 19 19 20 20 20 20 20

AVERAGE DAYS ON MARKET

550

500 ASIA PACIFIC

450

400

350

300 WORLDWIDE

250

200 Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep 17 17 18 18 18 18 18 18 19 19 19 19 19 19 20 20 20 20 20

Source: AMSTAT & ASG THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 41 MARKET DYNAMICS

SUPPLY / DEMAND INDICATORS BUSINESS JETS

SUPPLY VS. DEMAND RATIO AVERAGE DAYS ON MARKET

SUPPLY > DEMAND DAYS ON MARKET % OF FLEET MODEL FOR SALE

AVERAGE AVERAGE

15.8% ACJ318 4.3% ACJ319 AIRBUS NO TRANSACTIONS 5.6% ACJ320 3.7% BBJ 4.5% BBJ2 BOEING 6.0% CL300 2.3% CL350 10.6% CL604 10.8% CL605 5.6% CL650 16.7% CL850

16.2% BOMBARDIER GL Express 11.2% GL XRS 8.2% GL5000 6.8% GL6000 9.8% CIT. CJ3 5.3% CIT. CJ4 2.5% CIT. Latitude CESSNA 8.6% CIT. Sovereign NO TRANSACTIONS 6.1% F2000LX 6.0% F2000LXS 2.3% F2000S 6.6% F7X NO TRANSACTIONS 4.8% F8X

8.3% DASSAULT F900DX 7.6% F900EX 10.0% F900EXe 3.8% F900LX 13.8% L1000 6.2% L600 2.8% L650 EMBRAER 6.8% Phenom 300 8.8% G200 7.7% G280 9.0% G450 NO TRANSACTIONS 4.7% G500 7.2% G550 GULFSTREAM 4.3% G650 5.8% G650ER

450% 400% 350% 300% 250% 200% 150% 100% 50% 0 7.3% 0 200 400 600 800 1000 Average Average AC for sale / Total sold in last 12 months

The above chart reflects where certain aircraft models are positioned These indications do not necessarily mean that prices will be higher in in terms of supply and demand (based on a ratio of completed the future, but it does indicate that sellers of these particular models transactions compared to the number of sellers and the average are more likely to find willing buyers in a shorter period of time than the number of days on the market for a transaction to take place). overall average.

For some model types, given the market indicators shown on the This can be seen most with certain Gulfstream (G200, G450, G550, previous page, the stabilization in pre-owned asking prices and G650), Bombardier models (Challenger 604/605 & Global 5000) decline in inventory level appear to have stimulated increased and Dassault Falcon models (2000 Series and 7X), where more demand, leading to an increase in transactions and a more balanced transactions are occurring relative to the number for sale, and state of supply and demand. transactions are requiring less time on the market for sellers to complete.

Source: AMSTAT & ASG 42 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 BUSINESS JETS MARKET POSITIONING towards supply anddemandmarket earlier). equilibrium portrayed 4. Themomentumofthemarketplace (represented by thetrend 3. Theaverage days forsale relative to theoverall market average. 2. Thenumberofaircraft soldrelative to theaverage numberforsale. 1. Thepercentage ofaircraft forsalerelative to itsfleetsize. including thefollowingfourmarket indicators: model particular each for calculation ‘Marketability’ a on based is and market,overall the to relative model aircraft each of Ratio Demand providesThe above chart a visualrepresentation oftheSupply/ Source: AMSTAT & ASG GULFSTREAM EMBRAER DASSAULT CESSNA BOMBARDIER BOEING AIRBUS CIT. Sovereign Phenom 300 CIT. Latitude GL Express F2000LXS F2000LX F900EXe CIT. CJ4 CIT. CJ3 G650ER F900DX GL6000 GL5000 F900EX F2000S ACJ320 ACJ319 ACJ318 F900LX GL XRS CL850 CL650 CL605 CL604 CL350 CL300 L1000 BBJ 2 BBJ 1 G500 G200 G650 G550 G450 G280 L600 L650 F8X F7X MOVING TOWARDS BUYER’S MARKET including light jet models as described in the report. including lightjetmodelsasdescribedinthereport. models jet business 39 include to scope research market its expanded ASG Q3, 2019 Since * find buyers available, compare to corporateairlinermodels. the variousas well as Gulfstreamtopositioned better appear models, Falcon600, Challenger sizedas Series,medium such 900 jets, & 2000 When taking into account these four factors, most of the the large and Supply &Demand Balanced THIRD QUARTER 2020—ASIAN SKYQUARTERLY | MOVING TOWARDS SELLER’S MARKET MARKET DYNAMICS 43 MARKET DYNAMICS

PRE-OWNED CIVIL HELICOPTERS MARKET - 2020 Q3

INVENTORY VALUE (USD)1

WORLDWIDE

$1,395M

$1,161M

ASIA PACIFIC

$223M =

$170M

Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep 2017 2018 2019 2020

The Inventory Value Line represents the number of aircraft actively being marketed for sale in USD terms.2

The Trend Line represents the market’s direction in terms of the balance between sellers and buyers (supply and demand) at today’s price levels. A rising Trend Line indicates that pre-owned activity is stabilizing, with sellers of aircraft increasingly likely to find buyers.

The Signal Line represents an indication of where the market’s direction may be heading in the future. A Signal Line consistently falling below the Trend Line indicates that any improvement in the market’s direction may not be entirely sustainable.

MARKET TREND1 MOVING TOWARDS SELLER’S MARKET WORLDWIDE TREND MOVING TOWARDS BUYER’S MARKET WORSENING

TREND REVERSAL TREND WORSENING

TREND IMPROVEMENT

AIRCRAFT SOLD1 30 WORLDWIDE 28 28 26 26 23 24 21 22 20 20 19 19 19 19 19 17 17 18 16 14 16 15 13 11 12 12 12 12 12 12 10 10 9 7 9 5

Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep 2017 2018 2019 2020

1 The historical inventory value and transactions are subject to change based on latest market information updates. 2 ASG’s Inventory Value line is calculated by taking the total number of aircraft for sale from a selection of 16 different models, multiplied by their average asking prices. Source: AMSTAT & ASG 44 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 MARKET DYNAMICS

WORLDWIDE % OF FLEET SOLD

0.30%

0.25%

0.20%

0.15%

0.10%

0.05%

0.00% Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep 17 17 18 18 18 18 18 18 19 19 19 19 19 19 20 20 20 20 20

AVERAGE ASKING PRICE

3.6

3.4 ASIA PACIFIC MILLION USD 3.2

3.0

2.8 WORLDWIDE 2.6

2.4

2.2

2.0 Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep 17 17 18 18 18 18 18 18 19 19 19 19 19 19 20 20 20 20 20

% OF FLEET FOR SALE

5.5% WORLDWIDE 5.0%

4.5%

4.0%

3.5%

3.0% ASIA PACIFIC

2.5%

2.0%

1.5% Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep 17 17 18 18 18 18 18 18 19 19 19 19 19 19 20 20 20 20 20

AVERAGE DAYS ON MARKET

650 WORLDWIDE

600

550

ASIA PACIFIC 500

450

400 Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep 17 17 18 18 18 18 18 18 19 19 19 19 19 19 20 20 20 20 20

Source: AMSTAT & ASG THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 45 MARKET DYNAMICS CIVIL HELICOPTERS SUPPLY /DEMANDINDICATORS | ASIAN SKYQUARTERLY | —THIRDQUARTER46 2020 compared to thenumberofsellers, andaverage numberofdays onthemarket foratransactionto take place). reflects aircraftThe above where modelsare chart certain positionedintermsofsupplyand demand(basedonarationofcompletedtransactions Average AC forsale /Total soldinlast12months 350% SUPPLY VS.DEMANDRATIO 300% SUPPLY 250% AVERAGE 200% > 150% NO TRANSACTIONS NO TRANSACTIONS DEMAND 100% 50% 0 % OF FLEET % OFFLEET FOR SALE Average 10.1% 19.1% 4.5% 0.8% 3.8% 4.3% 4.4% 3.8% 5.8% 5.1% 3.8% 5.6% 2.9% 1.3% 2.8% 9.9% 4.8% 1.4%

SIKORSKY LEONARDO BELL HELICOPTER AIRBUS HELICOPTERS S76C+ AW139 BELL 429 BELL 412HP BELL 412EP BELL 407 BELL 206LongRanger BELL 206JetRanger EC135T2 EC135P2 H155 H145 H130 H125 EC145 AW109SP GN EC155B MODEL AVERAGE DAYS ONMARKET 0 100 200 DAYS ONMARKET 300 400 500 AVERAGE 600 700 800 Source: AMSTAT &ASG MARKET DYNAMICS

MARKET POSITIONING CIVIL HELICOPTERS

MOVING TOWARDS Balanced MOVING TOWARDS BUYER’S MARKET Supply & Demand SELLER’S MARKET

EC145

H125

H130

H145

H155 AIRBUS HELICOPTERS EC135P2

EC135T2

EC155B

BELL 206 JetRanger

BELL 206 LongRanger

BELL 407

BELL412EP BELL HELICOPTER

BELL412HP

BELL 429

AW109SP GN

AW139 LEONARDO

S76C+ SIKORSKY

The above chart provides a visual representation of the Supply / Demand Ratio of each aircraft model relative to the overall market, resulting in a ‘Marketability’ calculation of each particular model based on the following four market indicators:

1. The percentage of aircraft for sale relative to its fleet size. 2. The number of aircraft sold relative to the average number for sale. 3. The average days for sale relative to the overall market average. 4. The momentum of the marketplace (represented by the trend towards supply and demand market equilibrium portrayed earlier).

Source: AMSTAT & ASG THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 47 GLOBAL PRE-OWNED BUSINESS JET & TURBOPROP MARKET - Q3 2020 BY AMSTAT

There is no doubt that COVID-19 stifled a good start to business jet BUSINESS JETS & TURBOPROPS FOR SALE / LEASE resale transactions in 2020. Resale Retail Transactions were up over 2019 in both January (13%) and February (23%). However, as the Jet Turboprop broader implications of the pandemic on the globe were realized, business jet transaction activity significantly slowed with activity 2,400 in March, April and May down 23%, 42% and 44% respectively. However, whether it was the completion of previous transactions put in a holding pattern, an increase in demand for private travel, or 2,200 opportunity seekers as aircraft values slid further or a combination of these and other factors, business transaction started to pick up in June, up 11% over June 2019 and in July, up 32% versus July 2019. 2,000 That said, the market has a ways to do to meet 2019 activity levels. Year-to-date (January – July) resale retail transactions for business jets are down 7% from 2019 and are 20% below 2018. 1,800

In contrast to business jets, the business turboprop market underperformed 2019 from the start in 2020 and continued to do 1,600 so through May. As with the business jets there was a significant slowdown in March, April and May with year-over-year monthly reductions of 25%, 34% and 46% respectively. However, as with the 1,400 business jets, resale retail transactions in this market picked up in June and July with 58% and 5% year-over-year monthly increases respectively. Year-to-date resale transactions for turboprops are 12% 1,200 off from 2019 and 20% off 2018 levels.

The availability of resale business aircraft was already heading 1,000 upwards as we entered 2020 continuing a trend started in 2018. The rate of increase did go up after March but not significantly. Presently 2019 JUL 2019 2019 SEP 2019 2020 JUL 2019 JAN 2019 2020 JAN 2019 MAY 2019 2019 MAR 2019 2019 NOV 2019 2020 MAY the business jet inventory is up 4.1% year-to-date and the business 2020 MAR turbo-prop market is up 6.2%. Data Source: AMSTAT

48 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 COMMENTARY: GLOBAL PRE-OWNED BUSINESS JET & TURBOPROP MARKET - Q3 2020 BY AMSTAT

The AMSTAT Aircraft Valuation Tool looks to provide objective AIRCRAFT VALUATION: HEAVY JETS statistically generated values for heavily traded and newer business Increase Decrease jets and turboprops. The impact of COVID-19 was realized in the 5% values of all business aircraft market segments. Most (except Light Jets) had experienced a lift in values at the start of the year, 0% but this quickly reversed in March and values from then until June -5% and July fell between 15% and 20% in the Heavy, Super-Mid and Medium Jets. There is some evidence that values in these segments -10% recovered some in August. The trends were similar in Light Jets and -15% Turboprops although less pronounced with drop in values between February and July between 10% and 15%. -20% 2020 JUL 2020 FEB 2020 APR 2020 JAN 2020 JUN 2020 MAY 2020 MAR 2020 AUG

AIRCRAFT VALUATION: SUPER-MID JETS AIRCRAFT VALUATION: MEDIUM JETS Increase Decrease Increase Decrease 5% 5%

0% 0%

-5% -5%

-10% -10%

-15% -15%

-20% -20% 2020 JUL 2020 JUL 2020 FEB 2020 FEB 2020 APR 2020 APR 2020 JAN 2020 JAN 2020 JUN 2020 JUN 2020 MAY 2020 MAY 2020 MAR 2020 MAR 2020 AUG 2020 AUG

AIRCRAFT VALUATION: LIGHT JETS AIRCRAFT VALUATION: TURBO-PROP Increase Decrease Increase Decrease 5% 5%

0% 0%

-5% -5%

-10% -10%

-15% -15%

-20% -20% 2020 JUL 2020 JUL 2020 FEB 2020 FEB 2020 APR 2020 APR 2020 JAN 2020 JAN 2020 JUN 2020 JUN 2020 MAY 2020 MAY 2020 MAR 2020 MAR 2020 AUG 2020 AUG

About the AMSTAT Aircraft Valuation Tool About AMSTAT, Inc.

The AMSTAT Aircraft Valuation Tool (AVT) is fully integrated AMSTAT is the leading provider of market research information into the AMSTAT Premier service and calculates objective and services to the corporate aviation industry. Founded in statistically generated serial number specific estimated values 1982, and based in Tinton Falls, NJ, AMSTAT introduced the for business aircraft in seconds. concept of providing researched information to corporate aviation professionals. AMSTAT’s mission is to provide timely, accurate, and objective market information to its customers. AMSTAT products and services provide aviation market and statistical information that generates revenue and delivers competitive advantage to brokers/dealers, finance companies, fractional providers, and suppliers of aircraft parts and services.

Information: Andrew Young, AMSTAT GM, 732-530-6400 x147, [email protected]

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 49 FULL REPORT NOW AVAILABLE VIA

S92 FLEET CENSUS EXTRACT Q3 2020

Research & consulting firm Air & Sea Analytics publish regular 6-monthly updates on the S-92 crew transfer fleet. In this article, we share some of the key findings of the latest study and the rationale for taking a closer look at this part of the offshore rotorcraft sector. The offshore crew transfer market has in years past not been particularly transparent in terms of the commercial status of the operating fleet. This has led to speculation regarding utilization and activity levels. However, through a combination of multiple data sources and primary research Air & Sea Analytics believe that it is possible to build a robust data-driven view. The ‘S-92 Fleet Census’ report shows the current fleet by operator, location, year-on-year change, and provides a detailed list of aircraft with each crew change aircraft identified by serial number, current registration along with current status, owner, and location.

WHY IS S-92 UTILIZATION IMPORTANT?

• Idle Capacity is Expensive. At $28.5m per new unit, an versa, during an upcycle if there is a lack of available aircraft S-92 is a costly machine to have sitting idle. The problem this swings the pricing power in their favour. of excess capacity during a downturn is not unique to the • High levels of utilization are a trigger for new orders to be helicopter business (and indeed the S-92 has fared far better placed. OEMs take a keen interest in utilization because as than most other models in this latest downturn) but like the the market approaches full utilization, orders for new units offshore vessels and rigs markets – having multi-million are typically placed to accommodate demand. dollar assets idle and out of work puts a financial strain on the owners and operators. • Utilization in one weight class can often affect another. Low pricing levels can drag aircraft that would normally operate • Excess capacity = higher competition for new tenders in one weight category into another. We have seen this with and contract renewals = price competition. In a downturn, the Super-Medium category – availability of S-92s at cyclical excess capacity creates a buyers market for helicopter pricing lows has made it difficult for the operators of Super- services. Where there are concentrations of activity and Medium aircraft because they have to compete with larger/ multiple helicopter operators active (e.g. Brazil, USA, UK, higher performance helicopters at a similar pricing level to that Norway, Australia) there may be as many as four operators which they are trying to achieve with their own units. each competing to place aircraft with oil industry clients. Fierce competition on price occurs as a direct result. Vice

50 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 S92 FLEET CENSUS - EXTRACT│Q3 2020

Fleet Size 0 5 10 15 20

Note*: S-92 Crew Transfer Fleet Location - June 2020

The S-92 is often referred to as the ‘workhorse’ of the offshore oil and We had previously noted the growth in frontier areas as the driving gas industry. Just over 200 have been built configured for offshore movement in the fleet from country to country. However, in the last crew transfer and it is unique in its weight category (classed as a six months we have seen the movement into storage of several units ‘heavy’ i.e. >10,000kg MTOW) – since 2016 there is simply no other plus also the seasonality of offshore work in countries with harsh aircraft in operation in this category that is approved by all of the winters such as Norway and Canada. international oil majors for transporting their staff offshore. There are well over 10,000 offshore oil installations active, many of which In early 2019 Sikorsky also announced a new S-92 variant, the are unmanned, some have a small crew of 10-20 people but others S-92B (or S-92A+ for retrofitted aircraft) with higher performance may have over 100 persons on board at any one time (the Mariner engine options, a new gearbox design, latest automation technology development in the North Sea during its construction phase had over including ‘Rig Approach 2.0’ and new cabins that can be more- 800 people working offshore at the field!) easily reconfigured between offshore and SAR roles. Sikorsky is heavily promoting the run-dry performance of the new gearbox The S-92 is most-useful when operators need to move a large number which reportedly ran in testing for more than 7 hours. Pricing was of people (the S-92 can carry up to 19 at a time) through crew-change announced at HAI EXPO in Anaheim January 2020 at $3 million for cycles to offshore production platforms and mobile drilling rigs, and/ the A+ upgrade and $28.5 million for the new S-92B variant. or when the rig is far from shore. In April 2020 Sikorsky announced the first customer for the S-92A+ While some of the largest offshore producers are to be found in the as Cougar, which has ordered four of the upgrade kits. Middle East (such as Saudi Arabia, UAE, and Iran) conditions here are benign and near-to-shore. Offshore production in the North Sea and off the east coast of Canada however feature some of the harshest operating environments in the world with wave heights reaching over 15m in the winter and platforms typically some 120 - 350km from shore. This is where the S-92 has traditionally found the greatest application and indeed the UK remains the country with the most S-92 in-situ. Elsewhere the development of deepwater oil and gas reserves with large floating platforms in the Gulf of Guinea, the Gulf of Mexico, and Brazil have driven S-92 demand, in addition to major offshore developments in the South China Sea, Bohai Bay, Gulf of Thailand and Western Australia / Papua New Guinea.

Most recently we have seen an astonishing succession of finds in Guyana, where the first production was achieved in December 2019. ExxonMobil declared their 16th discovery earlier in the year (and revised the reserves recoverable estimate to 8 billion barrels of oil) and have now restarted drilling operations after two rigs were idled during the peak of the Covid-19 crisis. Guyana has one S-92 operating and more are expected to follow.

THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 51 S92 FLEET CENSUS - EXTRACT│Q3 2020

S92 H225 H175 AW189 13 15 Australia Australia

200 Azerbaijan Azerbaijan Aircraft

150 29 Brazil 29 Brazil 100

Brunei Brunei 50

13 China 13 China 0 Dec 2019 Jun 2020 9 Canada 10 Canada Active Heavy & Super-Medium Rotorcraft Crew Transfer Rotorcraft Dec 19 vs Jun 20 Ghana Ghana

Mexico Mexico KEY CONCLUSIONS FROM Q3 REPORT

38 Norway 39 Norway However, while the number of active aircraft has increased slightly, operators are thinning their fleets and returning inactive aircraft to lessors. Overall flights and flying hours are Nigeria Nigeria materially lower since early April this year Thailand Thailand (down 27% Y-o-Y at the time of writing) and these hours are being spread over the active fleet of aircraft. 45 UK 41 UK Norway now has the largest number of active S-92s. In the previous update of this report, it was noted that Norway and the RETIRED Trinidad and Tobago UK both had 36 S-92s active. We have since Trinidad and Tobago seen units move to Norway and as of June Guyana 2020, it has 38 units active compared to 29 in the UK. The UK still has the largest fleet of 35 USA S-92s in-situ. The USA was the third-largest 39 USA demand center with 25 units working. Guyana NEW For more information on the S-92 Fleet Census, please contact Poland Poland Air & Sea Analytics at [email protected] S-92 Crew Transfer Fleet Location by Country Dec 2019 (left) vs 2020 (right)

About Air & Sea Analytics

Air & Sea Analytics is a research & consulting firm formed in 2019 by Steve Robertson - an energy sector economist with a background in commercial & strategic market consulting and research. The company began by providing a timely and reliable measurement of activity in the Heavy, Super-Medium and Medium rotorcraft categories in oil & gas crew transfer. Within energy this has since expanded to include the emerging offshore wind market. Air & Sea has subsequently proven its methodology and approach to demand-side analytics in other rotorcraft markets including the utility sector.

Air & Sea Analytics owns one of the largest private networks of ADS-B receivers worldwide and collates data that is either not- shared by the public ADS-B networks or provides additional coverage in areas of interest for helicopter operations. In addition to regular subscription research products, the business also supports the financial and advisory community with bespoke analysis, used for business planning and transaction purposes. Projects are staffed by Air & Sea Analytics’ professional network of advisors and consultants, leveraging two-decades of commercial experience.

52 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 AIRCRAFT POSITIONING - BUSINESS JET AIRCRAFT ACQUISITION VS. MAX RANGE

24 23 22 CORP. AIRLINER 21 LONG RANGE 20 LARGE 19 MEDIUM 18 LIGHT 17 VERY LIGHT 16 ACJ321 BBJ3 BBJ2 15 ACJ320 14

13 ACJ319 BBJ G650ER 12 ACJ318 G650 11 GLOBAL 6000 G550 LINEAGE 1000E 10 F8X GLOBAL 5000 F7X 9

G500 8 F900LX

GLOBAL EXPRESS XRS 7 F2000LXS CL850 CL650 G450 6 F2000S LEGACY 650 GLOBAL EXPRESS G280 CL350 G-V G350 LEGACY 500 F900EX EASY 5 F2000LX LEGACY 600 CL605 CIT. X+ G-IVSP CIT. SOVEREIGN+ F2000DX G-IV F900EX G300 CIT. LATITUDE CL300 4 F2000 F2000EX LEGACY 450 CL604 F50EX CIT. X ANNUAL COST (MILLION USD/YEAR) TOTAL G200 H4000 CIT. XLS+ L75 CIT. SOVEREIGN 3 G150 H850XP H900XP

CIT. CJ4 L70 H800XP CIT. VII PHENOM 300 L45XR L60XR CIT. CJ3+ CIT. XLS CIT. EXCEL L40XR G100 ASTRA SP CIT. CJ2+ CIT. CJ3 CIT. ENCORE+ 2 CIT. M2 DIAMOND 1A CIT. ENCORE H800 CIT. ULTRA CIT. BRAVO CIT. CJ2 NEXTANT 400XTI H400XP CIT. CJ1+ CIT. CJ1 BEECHJET 400 PREMIER 1A HONDAJET PHENOM 100E CIT. MUSTANG

ECLIPSE 550

1 500 2,500 3,000 3,500 4,000 4,500 5,000 5,500 6,000 6,500 7,000 7,500 8,000 1,000 1,500 2,000

MAX RANGE (N.M.)

* The estimated total yearly cost is based on aircraft ownership cost for 10 years including financing, plus annual operating costs and regional adjustments.

Source: Conklin & de Decker 2019 THIRD QUARTER 2020 — ASIAN SKY QUARTERLY | 53 AIRBUS $29.9 $39.5 $50.8 2018 ACJ318, ACJ319 &ACJ320 INVENTORY LEVEL, PRICE TREND&TRANSACTIONS MARKET SUMMARY PERMODEL— 54 Sep SUPPLY Avg DaysonMarket Avg AskingPrice No. for Sale TRANSACTION PERFORMANCE Past 3Months Past 12Months Typ. Passengers Max Speed Max Range 11 |ASIANSKY QUARTERLY — Sold FEATURED AIRCRAFT 11 For Sale vs. Sold vs. Sale For Average Asking Price Asking Average Nov 12 1 For Sale

12 $30.3 $48.8 $39.5 2019

Jan 11

11 Mar 11 1,119 25.2M USD 3 (15.8%) 19 Mach 0.82 4,253 N.M./7,877km ACJ318 0 0 2020 Sep 2020 Sep SECOND QUARTER 2020 10 1 $48.7 $23.7 $39.5 May 10

10 0 0 1,027 25.2M USD 3 (15.8%) 2020 Jun 2020 Jun Jul 11 11 1 $46.9 $39.5 $23.2 Sep 10 1

9 2020 Sep 2020 Sep 1,022 42.0M USD 3 (4.3%) 19 Mach 0.82 6,000 N.M./11,112km ACJ319 0 1 Nov 9 8 $43.0 $26.0 $39.5 2020 Jan 8

8 2020 Jun 2020 Jun 1 1 930 42.0M USD 3 (4.3%) Mar 8 $39.5 8 • • • • • • TOTAL CYCLES: DELIVERYCYCLES TOTAL HOURS:DELIVERYHOURS BBJ 787-8 $25.2 $43.0 Radar, TCAS &TAWS; Approved For GLSIIApproaches SELCAL, ADS, FANS-1 &CPDLC; DualHead-UpDisplays;Weather State-of-the-art avionics,including: New, Latest Generation FMC; Aero H+Satcom w/Ku-BandHighSpeedInternet Lounge, Business Class, Fwd&AftGalley, Crew Rest Area andagym. meters) LivingSpace including:aMaster Suite, VIPLounge,Dining 39 Passenger VVIP Configuration, with2,415square feet (224square Non-stop One oftheLongest Ranged Business Jet-Capable ofFlying 16Hours Brand New Aircraft withDelivery Hours &Cycles Only Interior Completed 2019 May ACJ319 Average ACJ320 ACJ318

7 1 7 750 39.5M USD 1 (5.6%) 19 Mach 0.82 5,250 N.M./9,723km ACJ320 0 0 2020 Sep 2020 Sep BUSINESSJETS Jul 7 7 $25.2 $39.5 $42.0 Sep 7

0 0 658 39.5M USD 1 (5.6%) 2020 Jun 2020 Jun Market Indicators (vs. Last Quarter) Last (vs. Indicators Market Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) ACJ320 ACJ319 ACJ318

Source: AMSTAT &ASG MARKET SUMMARY -- JETS

BBJ & BBJ2

PERFORMANCE BBJ BBJ2

Max Range 6,235 N.M. / 11,547 km 5,620 N.M. / 10,408 km BOEING Max Speed Mach 0.82 Mach 0.82 Typ. Passengers 19 19

SUPPLY 2020 Sep 2020 Jun 2020 Sep 2020 Jun No. for Sale 5 (3.7%) 4 (3.0%) 1 (4.5%) 1 (4.5%) Avg Asking Price 30.5M USD 31.3M USD 90.0M USD 90.0M USD Avg Days on Market 545 573 133 41

TRANSACTION 2020 Sep 2020 Jun 2020 Sep 2020 Jun Past 12 Months 2 2 1 1 Past 3 Months 0 1 0 1

Average Asking Price BBJ2 Market Indicators (vs. Last Quarter) BBJ BBJ Average Transaction Level (Past 12 Months)

$90.0 $90.0 $90.0 $90.0 $90.0 $90.0 Inventory Level

Average Asking Price

Average Days on Market

$59.0 BBJ2 Transaction Level (Past 12 Months) $50.6 $52.5 $48.0 $45.6 Inventory Level $39.3 Average Asking Price $31.3 $30.5 For Sale vs. Sold Average Days on Market

Sold For Sale

3 2 2 1 1 1 1 1 1 1

12 12 12 13 12 11 11 12 12 13 11 10 9 9 7 7 7 8 8 6 6 5 6 6 6

Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep 2018 2019 2020 Source: AMSTAT & ASG

FEATURED AIRCRAFT CHALLENGER 650 SN 6131 TOTAL HOURS: 450 SINCE NEW TOTAL CYCLES: 185 SINCE NEW

• Mint 2019 Aircraft with Very Low Hours Since New • 11 Passengers & Belted Lav Configuration with Fwd Galley • Under Original OEM Warranty: 5 Years Airframe & 2 Years Interior • 2020 Avionics Ready: FANS 1A+, ADS-B Out, CPDLC & TCAS II 7.1 • Satellite Communication System • ELT, CVR & FDR

SECOND QUARTER 2020 — ASIAN SKY QUARTERLY | 55 BOMBARDIER

$17.2 2018 CHALLENGER 300&350 MARKET SUMMARY --JETS 56 $8.1 Sep SUPPLY Avg DaysonMarket Avg AskingPrice No. for Sale TRANSACTION PERFORMANCE Past 3Months Past 12Months Typ. Passengers Max Speed Max Range 25 4 |ASIANSKY QUARTERLY — Sold FEATURED AIRCRAFT 26 4 For Sale vs. Sold vs. Sale For Average Asking Price Asking Average Nov 23 7 For Sale

22 4 $16.4 $10.9 2019

Jan 17

7 24 5 Mar 23 2 224 7.9M USD 27 (6.0%) 19 Mach 0.82 3,340 N.M./6,185km CL300 8 28 2020 Sep 2020 Sep SECOND QUARTER 2020 28 4 $16.5 $9.6 May 36 2

37 3 3 20 229 7.5M USD 28 (6.2%) 2020 Jun 2020 Jun Jul 36 5 35 3 $16.2 $10.0 Sep 37 5

35 1 2020 Sep 2020 Sep 261 13.9M USD 8 (2.3%) 19 Mach 0.82 3,421 N.M./6,335km CL350 2 6 Nov 36 2 38 1 $15.5 $8.8 2020 Jan 13 35

33 2020 Jun 2020 Jun 1 4 159 14.9M USD 12 (3.5%) Mar 34 1 42 1 • • • • • • • TOTAL CYCLES: 199SINCENEW TOTAL HOURS:527SINCENEW CHALLENGER 350SN20649 $14.7 $7.6 Single OwnerSince New Aircraft StillUnderWarranty 3C InspectionCompleted: December 2019 Gogo BizCabinWifi&SwiftBroadband High SpeedData FANS 1/A+(CPDLC & ADS-C),TCAS 7.1 Tracking Fully Enrolled onPrograms: Honeywell MSP,BBDSmartParts &CAMP Delivery Date: December 2016 May Average CL300 CL350

40 2 40 1 Jul 38 6 36 1 $13.9 $7.9 Sep 35 3 Market Indicators (vs. Last Quarter) Last (vs. Indicators Market Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) CL350 CL300 Source: AMSTAT &ASG BOMBARDIER Source: AMSTAT & ASG AMSTAT Source: | 57 ASIAN SKY QUARTERLY MARKET SUMMARY -- JETS SUMMARY MARKET

CL604 CL605 CL650 Transaction Level (Past 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average Transaction Level (Past 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average Market Indicators (vs. Last Quarter) SECOND QUARTER 2020 — SECOND QUARTER 2020 Jun 7 (6.8%) 17.0M USD 221 2020 Jun 2 1 4

75 Sep $4.4 $17.0 $8.9 2 66 5 67 Jul 2020 Sep 3 1 2020 Sep CL650 / 7,635 km 4,123 N.M. Mach 0.82 10 6 (5.6%) 17.0M USD 215 2 67 2 65

CL650 CL605 CL604 Average May 9 Passenger Executive Configuration w/Forward Galley & Aft Lavatory Galley w/Forward Configuration Executive 9 Passenger on MSP Engines & APU Enrolled FDR / CVR 7.1 / ADS-B Out / TCAS SATCOM $4.8 $17.0 $9.8 • • • • CHALLENGER 300 SN 20382 1,301 SINCE NEW HOURS: TOTAL 498 SINCE NEW CYCLES: TOTAL 4 62 2 56 Mar 31 (10.8%) 10.2M USD 208 18 3 2020 Jun 2020 Jun 6 52

7 50 Jan 2020 $4.9 $17.5 $10.9 3 48 7 46 Nov 22 4 CL605 / 7,635 km 4,123 N.M. Mach 0.82 9 31 (10.8%) 8.9M USD 238 2020 Sep 2020 Sep 7 46

5 46 Sep $5.0 $18.2 $11.8 2 49 6 50 Jul 2020 Jun 29 (8.1%) 4.7M USD 273 2020 Jun 22 4 9 49

1 43 May $5.5 $18.7 $11.7 6 37 2020 Sep 28 6 CL604 / 7,458 km 4,027 N.M. Mach 0.82 9 2020 Sep 38 (10.6%) 4.4M USD 208 5 34 Mar 1 34

11 35 Jan

2019 $5.0 $18.7 $13.1 4 34

For Sale For 8 32 Nov Average Asking Price For Sale vs. Sold 9 25 FEATURED AIRCRAFT FEATURED Sold 7 28 Past 3 Months Past Past 12 Months Past Max Range Max Speed Passengers Typ. TRANSACTION PERFORMANCE Avg Asking Price Avg Days on Market Avg No. for Sale No. for SUPPLY Sep $5.3 2018 CHALLENGER 604, 605 & 650 604, CHALLENGER $18.7 $12.2

BOMBARDIER $8.6 CHALLENGER 850 2018 MARKET SUMMARY --JETS 58 Sep 8 |ASIANSKY QUARTERLY — Sold 8 For Sale vs. Sold vs. Sale For Average Asking Price Asking Average Nov 1 8 For Sale 8 $9.3 2019 Jan 3 7 8 Mar 8 SECOND QUARTER 2020 8 $5.0 May 9 9 Jul 2 9 9 $7.2 Sep 1 8 9 Nov 10 1 10 1 $6.8 2020 Jan 11 1 10 Mar 11 12 1 $6.8 May 13 1 14 Jul 14 15 1 $8.4 Sep 15 Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) SUPPLY Avg DaysonMarket Avg AskingPrice No. for Sale TRANSACTION PERFORMANCE Past 3Months Past 12Months Typ. Passengers Max Speed Max Range Market Indicators (vs. Last Quarter) Last (vs. Indicators Market

1 6 2020 Sep 492 8.4M USD (16.7%) 15 2020 Sep 18 Mach 0.87 6,750 N.M./12,501km Source: AMSTAT &ASG 2 5 2020 Jun 431 6.8M USD (15.4%) 14 2020 Jun BOMBARDIER

Source: AMSTAT & ASG AMSTAT Source: 14 2 121 21 (6.5%) 27.0M USD 2020 Jun 2020 Jun

| 59 ASIAN SKY QUARTERLY MARKET SUMMARY -- JETS SUMMARY MARKET 15 1 GLOBAL 6000 GLOBAL / 11,260 km 6,080 N.M. Mach 0.82 13 22 (6.8%) 24.1M USD 153 2020 Sep 2020 Sep

GLOBAL 6000 GLOBAL GLOBAL 5000 GLOBAL EXPRESS GLOBAL XRS GLOBAL Transaction Level (Past 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average Transaction Level (Past 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average Market Indicators (vs. Last Quarter) SECOND QUARTER 2020 — SECOND QUARTER 7 1 15 (9.3%) 16.4M USD 196 2020 Jun 2020 Jun

4 82 Sep $7.7 $16.3 $24.1 $14.9 5 79 4 Jul 74 10 3 2020 Sep 2020 Sep GLOBAL XRS GLOBAL / 11,520 km 6,226 N.M. Mach 0.82 13 18 (11.2%) 14.9M USD 248 2 79 3 73

GL6000 GL5000 Average May 17 Seats Executive Configuration with Fwd Galley & Aft Lavatory with Fwd Galley Configuration 17 Seats Executive Wifi Internet Swift Broadband via Inmarsat Broadband North Global True 96M Check Fresh 7.1 TCAS / FDR CVR Loader DBU-5000 Data ADS-B Out (DO-260A) Landing Gear Overhauled Installed Tanks Additional FATS $8.2 $16.4 $16.6 $27.0 • • • • • • • • • CHALLENGER 850 SN8098 1,822 SINCE NEW HOURS: TOTAL 916 SINCE NEW CYCLES: TOTAL 4 70 1 65 Mar 13 3 21 (14.5%) 8.0M USD 242 2020 Jun 2020 Jun 5 61

9 56 Jan 2020 $15.8 $10.2 $29.2 1 65 $27.0 GL EXPRESS GL XRS 15 2 GLOBAL EXPRESS GLOBAL / 11,343 km 6,125 N.M. Mach 0.82 13 2020 Sep 2020 Sep 23 (16.2%) 7.7M USD 274 10 61 Nov 6 66

8 68 Sep $9.3 $32.2 $32.0 $16.9 3 64 4 65 Jul 12 3 2020 Jun 2020 Jun 22 (9.5%) 18.6M USD 314 5 63

5 68 May $9.3 $19.3 $32.0 $31.7 3 74 2020 Sep 19 7 GLOBAL 5000 GLOBAL / 9,908 km 5,350 N.M. Mach 0.82 13 2020 Sep 19 (8.2%) 16.3M USD 307 5 69 Mar 1 60 7 $22.7

59 Jan

$9.2 2019 $18.4 $30.9 3

55 For Sale For 3 56 Nov Average Asking Price For Sale vs. Sold 3 52 FEATURED AIRCRAFT FEATURED Sold 5 51 Past 3 Months Past Past 12 Months Past Max Range Max Speed Passengers Typ. TRANSACTION PERFORMANCE Avg Asking Price Avg Days on Market Avg No. for Sale No. for SUPPLY Sep 2018 GLOBAL EXPRESS, 5000, XRS & 6000 5000, XRS EXPRESS, GLOBAL $8.3 $19.4 $37.0 $12.6

CESSNA

2018 $6.3 C MARKET SUMMARY --JETS 60 $4.2 Sep SUPPLY Avg DaysonMarket Avg AskingPrice No. for Sale TRANSACTION PERFORMANCE Past 3Months Past 12Months Typ. Passengers Max Speed Max Range 38 4 |ASIANSKY QUARTERLY — Sold ITATION CJ3 &CJ4 FEATURED AIRCRAFT 40 5 For Sale vs. Sold vs. Sale For Average Asking Price Asking Average Nov 10 46 For Sale

11 44 $6.0 2019 $4.1

Jan 14 36

37 3 Mar 45 6 198 4.3M USD 56 (9.8%) 6 Mach 0.73 1,891 N.M./3,502km Cit. CJ3 8 24 2020 Sep 2020 Sep SECOND QUARTER 2020 46 4 $6.4 $4.5 May 54 3

50 9 7 16 160 4.3M USD 61 (10.7%) 2020 Jun 2020 Jun Jul 51 6 44 6 $6.1 $4.2 Sep 10 43

46 9 2020 Sep 2020 Sep 204 5.2M USD 17 (5.3%) 7 Mach 0.77 1,991 N.M./3,687km Cit. CJ4 6 25 Nov 54 9 51 9 $6.3 $4.1 2020 Jan 53 4

63 5 2020 Jun 2020 Jun 3 19 176 5.5M USD 20 (6.3%) Mar 62 2 74 4 • • • • • • TOTAL CYCLES: 85SINCENEW TOTAL HOURS:180SINCENEW CHALLENGER 850SN8111 $5.7 $4.4 No DamageHistory ADS-B Out 15 Passenger Configuration; VP-registration Fresh 96-Month Check One UserSince New (Private Flights Only) Manufactured in2012&Delivered in2016

May Average CJ3 CJ4 74 5 81 1 Jul 12 76 72 2 $4.3 $5.2 Sep 73 Market Indicators (vs. Last Quarter) Last (vs. Indicators Market Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) Cit. CJ4 Cit. CJ3 Source: AMSTAT &ASG CESSNA 2020 Jun 32 (7.3%) 6.7M USD 164 6 (2.5%) 12.0M USD 165 2020 Jun 2020 Jun 2020 Jun 10 2 4 0 Source: AMSTAT & ASG AMSTAT Source: 3,010N.M. / 5,574 km Mach 0.80 9 2,870N.M. / 5,315 km Mach 0.80 9 2020 Sep 38 (8.6%) 7.0M USD 195 6 (2.5%) 12.7M USD 204 2020 Sep 2020 Sep 2020 Sep 11 1 4 0 | 61 ASIAN SKY QUARTERLY MARKET SUMMARY -- JETS SUMMARY MARKET

Market Indicators (vs. Last Quarter) Market Indicators (vs. Last Quarter) Past 12 Months 12 Months Past Past 3 Months 3 Months Past Past Max RangeMax Range Max SpeedMax Speed Passengers Passengers Typ. Typ. Max Range Max Speed Passengers Typ. 12 Months Past 3 Months Past TRANSACTION TRANSACTION PERFORMANCE PERFORMANCE PERFORMANCE TRANSACTION No. for Sale Sale No. for No. for No. for Sale No. for Asking Price Avg Days on Market Avg Asking Price Asking Price Avg Avg Days on Market Days on Market Avg Avg SUPPLY SUPPLY SUPPLY Transaction Level (Past 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average Transaction Level (Past 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average SECOND QUARTER 2020 — SECOND QUARTER 6 38 Sep Sep $7.0 $12.7 6 36 6 1 36 Jul Jul 6 32 5 1 30 $6.7 May May $12.0 5 1 29 5 5 27 Mar Mar 7 2 3 25 8 22 Jan Jan $6.9 2020 2020 $13.0 6 24 1 6 24 Nov Nov 1 7 19 2 5 24 $7.6 Sep Sep $13.4 5 20 5 22 Jul Jul 5 22 5 22 May May $7.8 $13.6 4 24 4 22 Mar Mar 3 23 SOVEREIGN LATITUDE 2 1 18 $6.5 Jan Jan 2019 2019 1 1 18 For Sale For For Sale For $13.1 2 19 Nov Nov Average Asking Price Average Asking Price For Sale vs. Sold For Sale vs. Sold 2 14 Sold Sold ITATION ITATION 2 14 $8.3 Sep Sep C $12.3 C 2018 2018 DASSAULT $11.9 $18.5 FALCON 900DX/EX/EX EASy/LX 2018 $7.4 MARKET SUMMARY --JETS 62 Sep SUPPLY Avg DaysonMarket Avg AskingPrice No. for Sale TRANSACTION PERFORMANCE Past 3Months Past 12Months Typ. Passengers Max Speed Max Range 22 |ASIANSKY QUARTERLY — 2 Sold $15.2 FEATURED AIRCRAFT 24 2 For Sale vs. Sold vs. Sale For Average Asking Price Asking Average Nov 17 5 For Sale

18 3 $27.9 $6.9 2019 $12.0

Jan

19 $14.2 6 18 1 Mar 19 312 12.1M USD 2 (8.3%) 12 Mach 0.83 4,100 N.M./7,593km F900DX 2 7 2020 Sep 2020 Sep 2 SECOND QUARTER 2020 18 1 $15.0 $24.5 $12.9 $6.9 May 16 2

17 6 1 5 206 11.8M USD 4 (16.7%) 2020 Jun 2020 Jun Jul 17 2 $15.9 $12.4 16 2 $23.9 $7.5 Sep 15 2

16 2 Nov 12 Mach 0.83 4,500 N.M./8,334km 21 F900EX 128 7.5M USD 9 (7.6%) 2 12 2020 Sep 2020 Sep 4 F900LX F900EX EASy 20 1 $14.4 $21.0 $13.4 $6.6 2020 Jan 22 9

29 1 0 10 161 7.8M USD 5 (4.2%) 2020 Jun 2020 Jun Mar 32 1 31 1 • • • • • • • • • • TOTAL CYCLES: 953SINCENEW TOTAL HOURS:2,604SINCENEW G450 SN4202 $21.0 $13.7 $12.6 $8.2 96 MonthInspection Completed Fresh AnnualInspection Honeywell HeadUpDisplay/VisualGuidance System FANS-1A, CPDLC, TCAS7.1 ADSB-Out, HighSpeedData, FMImmunity FAA Compliant,EASAValidation Airframe Enrolled onGulfstream Planeparts APU Enrolled onMSP Engines Enrolled onRRCC 14 Passenger Configuration withForward Galley Average F900DX F900EX May 28

2 27 2 Jul 12 Mach 0.83 4,500 N.M./8,334km F900EX EASy 2020 Sep 2020 Sep 300 12.6M USD 12 (10.0%) 2 7 26 1 24 5 $21.0 $12.6 $12.1 $7.5 Sep 26

2020 Jun 2020 Jun 3 5 217 13.4M USD 14 (11.7%) Market Indicators (vs. Last Quarter) Last (vs. Indicators Market Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) F900LX F900EX EASy F900EX F900DX

2020 Sep 2020 Sep 173 21.0M USD 3 (3.8%) 0 3 F900LX 12 Mach 0.83 4,750 N.M. /8,800km Source: AMSTAT &ASG

2020 Jun 2020 Jun 2 3 120 21.0M USD 4 (5.1%)

DASSAULT Source: AMSTAT & ASG AMSTAT Source: | 63 ASIAN SKY QUARTERLY MARKET SUMMARY -- JETS SUMMARY MARKET

F2000LX F2000LXS F2000S Transaction Level (Past 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average Market Indicators (vs. Last Quarter) 1 (2.3%) 27.7M USD 257 0 0 2020 Jun 2020 Jun SECOND QUARTER 2020 — SECOND QUARTER

15 Sep $27.7 $21.5 $12.5 15 1 1 1 1 (2.3%) 27.7M USD 349 2020 Sep 2020 Sep F2000S /6,208 km 3,350 N.M. Mach 0.83 10 15 Jul 17

16 F2000S F2000LXS F2000LX Average May Engines & APU Enrolled Pro-Rata JSSI Pro-Rata Engines & APU Enrolled Rest & Crew Galley Forward 16 Pax, Divans & Aft Double Area 4 Club, Conf. Beijing Based, all Logs in English Refurbished 2017 & Interior Painting 1/A+ & FANS ADS-B Out, CPDLC BBML & HD-700 Corrosion No Damage or Material $12.5 $21.8 $27.7 • • • • • • • • G550 3,162 SINCE NEW HOURS: TOTAL 1,168 SINCE NEW CYCLES: TOTAL 1 16 15 Mar 2020 Jun 2020 Jun 8 (8.2%) 21.8M USD 277 4 0 1 16

2 16 Jan 2020 $27.7 $22.3 $15.0 1 16 2 2020 Sep 2020 Sep 4 0 334 6 (6.0%) 21.5M USD F2000LXS 4,000 N.M. /7,408 km 4,000 N.M. Mach 0.83 10 16 Nov 14

1 12 Sep $0.0 $22.6 1 13 $14.2 11 Jul 2020 Jun 8 (6.1%) 12.0M USD 242 3 1 2020 Jun 2 11

1 11 May $22.8 $23.5 $16.0 1 11 3 0 2020 Sep 2020 Sep 4,000 N.M. /7,408 km 4,000 N.M. Mach 0.83 10 F2000LX 8 (6.1%) 12.5M USD 277 8 1 Mar 7 2 7

3

Jan 2019 $16.0 $25.0 9 1

For Sale For $25.0 8 4 Nov Average Asking Price For Sale vs. Sold 9 FEATURED AIRCRAFT FEATURED Sold 8 2 Past 12 Months Past Past 3 Months Past Max Range Max Speed Passengers Typ. TRANSACTION PERFORMANCE No. for Sale No. for Asking Price Avg Days on Market Avg SUPPLY Sep FALCON 2000LX/LXS/S FALCON 2018 $16.1 $16.5 $25.0 DASSAULT $21.7 2018 MARKET SUMMARY --JETS 64 FALCON 7X Sep 14 4 |ASIANSKY QUARTERLY — Sold 11 4 For Sale vs. Sold vs. Sale For Average Asking Price Asking Average Nov 2 9 For Sale 12 4 $26.6 2019 Jan 15 2 15 1 Mar 18 2 SECOND QUARTER 2020 17 5 $26.7 May 17 3 16 2 Jul 16 1 17 1 $27.3 Sep 19 2 18 1 Nov 14 3 15 2 $23.6 2020 Jan 20 1 22 1 Mar 2 20 20 2 $26.1 May 22 1 20 19 Jul 20 2 $21.1 Sep 19 Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) SUPPLY Avg DaysonMarket Avg AskingPrice No. for Sale TRANSACTION PERFORMANCE Past 3Months Past 12Months Typ. Passengers Max Speed Max Range Market Indicators (vs. Last Quarter) Last (vs. Indicators Market

2 15 2020 Sep 259 21.1M USD (6.6%) 19 2020 Sep 12 Mach 0.90 5,950 N.M./11,018km Source: AMSTAT &ASG 3 13 2020 Jun 304 24.5M USD (5.2%) 15 2020 Jun EMBRAER L650 3 | 6 15.0M USD 15.0M USD 310 | 211 Sep | Jun L650 3,640 N.M. 7,112 km Mach 0.80 13 Sep | Jun 7 | 6 1 | 0 36 (6.5%) 6.8M USD 274 2020 Jun 2020 Jun 18 3 L600 Source: AMSTAT & ASG AMSTAT Source: L600 3,400 N.M. 6,297 km Mach 0.80 13 12 | 13 7.8M USD 7.9M USD 319 | 286 Sep | Jun Sep | Jun 15 | 14 1 | 4 1,242 N.M. / 2,300 km Mach 0.78 5 38 (6.8%) 6.8M USD 266 2020 Sep 2020 Sep 26 8 | 65 ASIAN SKY QUARTERLY MARKET SUMMARY -- JETS SUMMARY MARKET (Past 12 Months) (Past

Market Indicators (vs. Last Quarter) Market Indicators (vs. Last Quarter) Past 12 Months Past 3 Months Past Max Range Max Speed Passengers Typ. TRANSACTION PERFORMANCE No. for Sale No. for Asking Price Avg Days on Market Avg SUPPLY Max Range Max Speed Passengers Typ. 12 Months Past 3 Months Past PERFORMANCE TRANSACTION No. for Sale No. for Asking Price Avg Days on Market Avg SUPPLY Inventory Level Inventory Asking Price Average Days on Market Average Transaction Level Transaction Transaction Level (Past 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average SECOND QUARTER 2020 — SECOND QUARTER 15 38 Sep Sep $6.8 $7.8 $15.0 15 1 35 2 17 7 Jul Jul 38 2 19 1 36 1 21 2 35 L600 Average L650 May May $7.8 $6.7 $15.0 1 24 0 33 2 12 1 26 Mar Mar 3 19 1 25 2 23 3 20 Jan Jan $5.3 2020 2020 $7.1 $14.0 3 25 2 20 1 21 3 20 Nov Nov 2 22 3 20 2 21 5 21 Sep Sep $4.7 $6.9 $15.1 3 21 4 20 3 24 2 19 Jul Jul 4 22 2 19 1 21 3 18 May May $7.0 $6.9 $15.1 23 19 25 2 18 Mar Mar 21 1 18 7 21 8 16 Jan Jan $7.3 $7.5 2019 2019 $12.3 1 22 2 16 For Sale For For Sale For 3 22 2 15 Nov Nov Average Asking Price Average Asking Price For Sale vs. Sold For Sale vs. Sold 2 21 1 13 Sold Sold 24 6 10 Sep Sep $7.2 LEGACY 600/650 LEGACY PHENOM 300 PHENOM $6.8 2018 2018 $11.7 EMBRAER $23.5 2018 MARKET SUMMARY --JETS 66 LINEAGE 1000/E Sep 6 |ASIANSKY QUARTERLY — Sold 7 For Sale vs. Sold vs. Sale For Average Asking Price Asking Average Nov 1 7 For Sale 7 $22.2 2019 Jan 8 9 Mar 9 SECOND QUARTER 2020 9 $21.4 May 9 9 Jul 9 6 $20.6 Sep 6 1 6 Nov 7 7 $20.5 2020 Jan 4 1 3 Mar 3 6 $18.3 May 5 5 Jul 4 4 $17.7 Sep 4 Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) SUPPLY Avg DaysonMarket Avg AskingPrice No. for Sale TRANSACTION PERFORMANCE Past 3Months Past 12Months Typ. Passengers Max Speed Max Range Market Indicators (vs. Last Quarter) Last (vs. Indicators Market

0 2 2020 Sep 676 17.7M USD (13.8%) 4 2020 Sep 19 Mach 0.82 4,400 N.M./8,149km Source: AMSTAT &ASG 0 2 2020 Jun 525 18.3M USD (17.2%) 5 2020 Jun GULFSTREAM 2020 Jun 15 (7.8%) 13.2M USD 196 2020 Jun 31 (12.9%) 4.1M USD 196 2020 Jun 2020 Jun 3 0 19 1 Source: AMSTAT & ASG AMSTAT Source: 3,600 N.M. / 6,667 km Mach 0.84 8 3,050 N.M. / 5,651 km Mach 0.81 8 2020 Sep 15 (7.7%) 13.9M USD 212 2020 Sep 21 (8.8%) 3.7M USD 270 2020 Sep 2020 Sep 5 2 23 4 | 67 ASIAN SKY QUARTERLY | 67 ASIAN SKY QUARTERLY MARKET SUMMARY -- JETS SUMMARY MARKET MARKET SUMMARY -- JETS SUMMARY MARKET

Market Indicators (vs. Last Quarter) Market Indicators (vs. Last Quarter) Past 12 Months Past 3 Months Past Max Range Max Speed Passengers Typ. Max Range Max Speed Passengers Typ. 12 Months Past 3 Months Past TRANSACTION PERFORMANCE PERFORMANCE TRANSACTION No. for Sale No. for No. for Sale No. for Asking Price Avg Days on Market Avg Asking Price Avg Days on Market Avg SUPPLY SUPPLY Transaction Level (Past 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average Transaction Level (Past 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average SECOND QUARTER 2020 — SECOND QUARTER SECOND QUARTER 2020 — SECOND QUARTER 21 15 Sep Sep $3.7 $13.9 2 1 13 24 3 15 27 Jul Jul 1 15 21 15 22 May May $14.0 $4.1 14 22 13 21 Mar Mar 2 12 22 9 1 8 22 Jan Jan 2020 2020 $4.0 $14.1 3 24 11 1 1 27 12 Nov Nov 3 1 25 10 1 9 28 Sep Sep $4.0 $16.0 4 8 28 2 9 27 Jul Jul 2 7 27 4 4 27 May May $4.2 $15.3 4 1 25 4 1 21 Mar Mar 4 4 20 4 4 3 23 Jan Jan 2019 2019 $5.0 $17.5 2 4 27 For Sale For For Sale For 2 2 26 Nov Nov Average Asking Price Average Asking Price For Sale vs. Sold For Sale vs. Sold 2 2 1 21 Sold Sold 3 6 17 Sep Sep G280 G200 $3.8 2018 2018 $17.5 GULFSTREAM $29.2 $15.1 2018 2018 G450 MARKET SUMMARY --JETS 68 G550 Sep Sep 24 26 4 3 |ASIANSKY QUARTERLY — Sold Sold 20 24 4 4 For Sale vs. Sold vs. Sale For For Sale vs. Sold vs. Sale For Average Asking Price Asking Average Price Asking Average Nov Nov 20 27 5 3 For Sale For Sale 18 28 5 1 $15.4 $26.5 2019 2019 Jan Jan 18 27 5 5 17 26 6 3 Mar Mar 22 27 2 3 SECOND QUARTER 2020 25 18 4 4 $23.4 $16.5 May May 22 18 3 2 21 19 1 3 Jul Jul 23 24 2 23 31 3 3 $22.9 $15.8 Sep Sep 23 32 5 2 21 31 4 2 Nov Nov 28 33 2 5 29 33 1 2 $21.0 $14.3 2020 2020 Jan Jan 32 25 8 2 36 29 2 Mar Mar 39 31 1 1 45 20 $18.3 $12.3 May May 49 20 3 4 48 23 1 35 48 Jul Jul 1 3 34 46 2 5 $11.9 $16.6 Sep Sep 32 43 2 Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) SUPPLY SUPPLY Avg DaysonMarket Avg AskingPrice No. for Sale Avg DaysonMarket Avg AskingPrice No. for Sale TRANSACTION PERFORMANCE TRANSACTION PERFORMANCE Past 3Months Past 12Months Typ. Passengers Max Speed Max Range Past 3Months Past 12Months Typ. Passengers Max Speed Max Range Market Indicators (vs. Last Quarter) Last (vs. Indicators Market Market Indicators (vs. Last Quarter) Last (vs. Indicators Market

3 19 10 44 2020 Sep 2020 Sep 365 11.9M USD (9.0%) 32 2020 Sep 240 16.6M USD (7.2%) 43 2020 Sep 13 Mach 0.85 4,350 N.M./8,056km 18 Mach 0.87 6,750 N.M./12,501km Source: AMSTAT &ASG 4 16 4 34 2020 Jun 2020 Jun 343 12.4M USD (8.8%) 31 203 17.7M USD (8.1%) 48 2020 Jun 2020 Jun GULFSTREAM G650ER 13 | 11 42.5M USD 46.6M USD 176 | 214 Sep | Jun G650ER 7,500 N.M. 13,890 km Mach 0.90 18 Sep | Jun 7 | 4 3 | 1 G650 Source: AMSTAT & ASG AMSTAT Source: G650 7,000 N.M. 12,964 km Mach 0.90 18 8 | 5 39.4M USD 39.4M USD 144 | 157 Sep | Jun Sep | Jun 6 | 5 1 | 1 | 69 ASIAN SKY QUARTERLY MARKET SUMMARY -- JETS SUMMARY MARKET (Past 12 Months) (Past

Market Indicators (vs. Last Quarter) Past 12 Months Past 3 Months Past Max Range Max Speed Passengers Typ. PERFORMANCE TRANSACTION No. for Sale No. for Asking Price Avg Days on Market Avg SUPPLY Inventory Level Inventory Asking Price Average Days on Market Average Transaction Level Transaction SECOND QUARTER 2020 — SECOND QUARTER 21 Sep $39.4 $42.5 1 19 3 23 Jul 1 16 15 G650 Average G650ER May $39.4 $44.2 1 16 1 13 Mar 14 3 14 Jan 2020 $50.7 $44.4 1 17 1 15 Nov 17 1 16 Sep $46.2 $46.7 1 16 16 Jul 1 15 1 16 May $55.3 $50.9 15 2 10 Mar 9 4 3 12 Jan 2019 $61.9 $52.4 3 12 For Sale For 1 14 Nov Average Asking Price For Sale vs. Sold 1 18 Sold 2 15 Sep G650 & G650 ER G650 & 2018 $55.5 $56.0 AIRCRAFT POSITIONING - CIVIL HELICOPTERS ACQUISITION COST VS. MAX RANGE 6 HEAVY (SUPER) MEDIUM H225 S-92 5 LIGHT TWIN SINGLE TURBINE PISTON H215(C1) 4 H175 AW189 S-76D 3 H155 AW139 BELL 412EPI S-76C++ H135(T3) H145 BELL 430 AW169 2 MD902 BELL 429 AW109 GRANDNEW AW109 POWER BELL 206L4 BELL 407GXP H125 MD530F H130 AW119KX MD600N AIRCRAFT ACQUISITION PRICE (MILLION USD) AIRCRAFT ACQUISITION 1 MD502N H120 MD550E R66 BELL 505 R22 BETA II R44 RAVEN II EN480B BELL 407 0 100 200 300 400 500 600 700 MAXIMUM RANGE (N.M) ACQUISITION COST VS. MAX TAKEOFF WEIGHT 8 HEAVY (SUPER) MEDIUM H225 S-92 LIGHT TWIN H215(C1) 4 SINGLE TURBINE H155 PISTON H145 S-76D AW189 AW169 H175 AW139 2 MD 902 BELL 412EPI BELL 429 S-76C++ H135(T3) BELL 430 AW109 POWER AW109 GRANDNEW MD520N H120 BELL 407GXP MD530F AW119KX 1 H130 MD500E H125 BELL 407 BELL 206L4 EN480B MD 600N R66 BELL 505

0.5 AIRCRAFT ACQUISITION PRICE (MILLION USD) AIRCRAFT ACQUISITION R44 RAVEN II R22 BETA II 0.25 1000 2000 4000 8000 16000 32000 MAX TAKE-OFF WEIGHT (LBS) ACQUISITION COST VS. CABIN VOLUME 8 H225 HEAVY (SUPER) MEDIUM LIGHT TWIN H215(C1) S-92 4 SINGLE TURBINE H175 S-76D H155 AW189 PISTON BELL430 AW139 H145 AW169 BELL412EPI 2 MD 902 S-76C++ H135(T3) BELL429 AW109 GRANDNEW H125 BELL 407GXP AW109 POWER MD 520N AW119KX H130 MD 600N 1 MD 530F H120 BELL 407 EN480B MD 500E BELL 206L4 R66 BELL 505

0.5

AIRCRAFT ACQUISITION PRICE (MILLION USD) AIRCRAFT ACQUISITION R44 RAVEN II R22 BETA II 0.25 20 40 80 160 320 640 800 CABIN VOLUMN (CU.FT)

Source: Conklin & de Decker 2019 70 | ASIAN SKY QUARTERLY — THIRD QUARTER 2020 MARKET SUMMARY PER MODEL — CIVIL HELICOPTERSMARKET SUMMARY -- HELICOPTERS INVENTORY LEVEL, PRICE TREND & TRANSACTIONS H125

Average Asking Price Market Indicators (vs. Last Quarter)

Transaction Level (Past 12 Months) $2.5 Inventory Level $2.5 $2.5 Average Asking Price Average Days on Market $2.4 $2.4

$2.4 PERFORMANCE Max Range 340 N.M. / 630 km Max Speed 140 Knots $2.3 For Sale vs. Sold Typ. Passengers 6

Sold For Sale SUPPLY 2020 Sep 2020 Jun 4 4 8 No. for Sale 25 (2.9%) 26 (3.1%) 4 1 3 2 1 2 3 2 Avg Asking Price 2.4M USD 2.4M USD 1 2 2 3 1 2 1 1 Avg Days on Market 546 530

2020 Sep 2020 Jun 21 23 23 23 25 26 31 32 33 29 27 29 25 26 27 25 27 26 26 24 26 26 24 26 26 TRANSACTION Past 12 Months 22 15 Past 3 Months 7 6

Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep 2018 2019 2020

H130

Average Asking Price Market Indicators (vs. Last Quarter)

$3.1 Transaction Level (Past 12 Months) $3.1 AIRBUS $3.0 Inventory Level Average Asking Price $2.9 $2.9 Average Days on Market

$2.7 $2.6 PERFORMANCE Max Range 333 N.M. / 606km Max Speed 128 Knots For Sale vs. Sold Typ. Passengers 7

Sold For Sale 1 2020 Sep 2020 Jun 1 SUPPLY 2 1 No. for Sale 16 (5.6%) 11 (3.9%) 1 1 1 Avg Asking Price 2.6M USD 2.7M USD 2 Avg Days on Market 233 231 2 1 1 1

TRANSACTION 2020 Sep 2020 Jun 5 5 5 4 4 9 10 10 9 10 11 10 10 11 9 9 9 9 7 8 11 11 8 11 11 Past 12 Months 5 3 Past 3 Months 2 1 Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep 2018 2019 2020

Source: AMSTAT & ASG

SECOND QUARTER 2020 — ASIAN SKY QUARTERLY | 71 MARKET SUMMARY -- HELICOPTERS

EC135P2 & T2

Average Asking Price EC135T2 Market Indicators (vs. Last Quarter) EC135P2 EC135P2 EC135T2 Average Transaction Level (Past 12 Months) $3.1 Inventory Level

$2.5 $2.6 Average Asking Price $2.4 $2.4 $2.2 $2.2 Average Days on Market

$1.8 $1.7 $1.7 $1.7 $1.7 $1.7 PERFORMANCE EC135P2 EC135T2 Max Range 332 N.M. 332 N.M. 614 km 614 km For Sale vs. Sold Max Speed 127 Knots 127 Knots Typ. Passengers 6 6 Sold For Sale 5 2 SUPPLY Sep | Jun Sep | Jun No. for Sale 6 | 7 2| 1 1 1 Avg Asking Price 2.4M USD 1.7M USD 1 1 1 1 1 2.2M USD 1.7M USD Avg Days on Market 645 | 595 132 | 116

12 12 11 9 9 10 10 11 12 12 11 11 11 11 10 11 10 8 9 9 8 8 7 8 8 TRANSACTION Sep | Jun Sep | Jun Past 12 Months 2 | 2 2 | 1 Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Past 3 Months 0 | 1 1 | 1 2018 2019 2020

EC145

Average Asking Price Market Indicators (vs. Last Quarter)

Transaction Level (Past 12 Months)

$4.8 Inventory Level

AIRBUS Average Asking Price $4.3 $4.3 Average Days on Market

$3.6 $3.9 PERFORMANCE $3.4 $3.8 Max Range 461 N.M. / 855 km Max Speed 131 Knots For Sale vs. Sold Typ. Passengers 9

Sold For Sale SUPPLY 2020 Sep 2020 Jun 1 1 2 No. for Sale 9 (1.3%) 10 (1.4%) 2 1 3 4 Avg Asking Price 3.9M USD 3.9M USD 3 3 2 1 1 Avg Days on Market 453 440 2 1 1

15 14 14 12 13 13 13 13 12 9 9 8 10 12 10 9 9 9 9 9 10 10 9 10 9 TRANSACTION 2020 Sep 2020 Jun Past 12 Months 13 11 Past 3 Months 2 3 Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep 2018 2019 2020

Source: AMSTAT & ASG

72 | ASIAN SKY QUARTERLY — SECOND QUARTER 2020 MARKET SUMMARY -- HELICOPTERS

H155 & EC155B

Average Asking Price EC155B Market Indicators (vs. Last Quarter)

H155 H155 EC155B Average Transaction Level (Past 12 Months)

$5.5 $5.5 Inventory Level $5.1 $4.9 Average Asking Price $4.5 Average Days on Market $3.9 $3.9 $3.7

$2.6 $2.6 PERFORMANCE H155 EC155B $2.4 $2.0 $2.0 $2.9 Max Range 516 N.M. 516 N.M. 955 km 955 km For Sale vs. Sold Max Speed 150 Knots 135 Knots Typ. Passengers 13 13 Sold For Sale

SUPPLY Sep | Jun Sep | Jun 1 1 1 No. for Sale 14 | 13 2 | 3 1 Avg Asking Price 3.9M USD 2.6M USD 1 3.9M USD 2.6M USD Avg Days on Market 686 | 644 493 | 390

15 13 13 13 12 12 12 11 10 11 11 15 23 20 18 17 18 16 16 16 16 16 16 17 16 TRANSACTION Sep | Jun Sep | Jun Past 12 Months 0 | 0 3 | 2 Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Past 3 Months 0 | 0 1 | 1 2018 2019 2020

H225

Average Asking Price Market Indicators (vs. Last Quarter)

Transaction Level (Past 12 Months) AIRBUS $9.0 Inventory Level Average Asking Price $7.0 $6.2 $5.8 $6.0 $6.0 Average Days on Market

$4.0 PERFORMANCE Max Range 452 N.M. / 837 km Max Speed 142 Knots For Sale vs. Sold Typ. Passengers 19

Sold For Sale SUPPLY 2020 Sep 2020 Jun No. for Sale 9 (5.1%) 9 (5.1%) Avg Asking Price 9.0M USD 6.2M USD Avg Days on Market 853 701

13 13 17 17 16 13 13 13 13 13 13 13 13 12 12 11 11 9 9 11 10 9 8 9 9 TRANSACTION 2020 Sep 2020 Jun Past 12 Months 0 0 Past 3 Months 0 0 Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep 2018 2019 2020

Source: AMSTAT & ASG

SECOND QUARTER 2020 — ASIAN SKY QUARTERLY | 73 BELL 2018 2018 BELL 407 BELL 206JETRANGER/LONGRANGER MARKET SUMMARY --HELICOPTERS 74 $1.9 $0.6 $0.9 201 Sep Sep 44 4 |ASIANSKY QUARTERLY — Sold Sold 201 46 5 For Sale vs. Sold vs. Sale For Sold vs. Sale For Average Asking Price Asking Average Price Asking Average 211 Nov Nov 47 5 For Sale For Sale 215 48 6 $2.0 2019 2019 $0.6 $0.9 205 Jan Jan 10 48 209 48 3 201 Mar Mar 41 1 SECOND QUARTER 2020 208 38 5 $0.6 $2.0 $0.9 May May 215 41 5 213 43 5 211 Jul Jul 44 4 210 39 7 $2.2 $0.9 $0.5 208 Sep Sep 43 3 206 44 3 193 Nov Nov 49 5 201 53 2 $0.8 2020 2020 $2.2 $0.6 207 Jan Jan 51 4 216 46 7 5 211 Mar Mar 46 9 3 208 49 13 3 Bell 206LongRanger Bell 206JetRanger Average $0.5 $0.9 $2.4 May May 208 49 6 4 207 52 206 Jul Jul 60 1 2 206 60 2 $0.8 $0.5 $2.3 205 Sep Sep 60 1 Transaction Level Average DaysonMarket Average AskingPrice Inventory Level Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) SUPPLY Avg DaysonMarket Avg AskingPrice No. for Sale TRANSACTION PERFORMANCE Typ. Passengers Max Speed Max Range Past 3Months Past 12Months Market Indicators (vs. Last Quarter) Last (vs. Indicators Market SUPPLY Avg DaysonMarket Avg AskingPrice No. for Sale TRANSACTION PERFORMANCE Past 3Months Past 12Months Typ. Passengers Max Speed Max Range Market Indicators (vs. Last Quarter) Last (vs. Indicators Market

(Past 12Months)

2 |15 31 |29 Sep |Jun 815 |789 0.5M USD 0.5M USD 125 | Sep |Jun 4 121 Knots 693 km 374 N.M. Bell 206J 4 37 2020 Sep 365 2.3M USD (3.8%) 60 2020 Sep 7 132 Knots 323 N.M./598km Source: AMSTAT &ASG Bell 206J Sep |Jun Sep |Jun 9 33 2020 Jun 506 2.3M USD (3.3%) 52 2020 Jun 0 |2 4 | 434 |403 0.9M USD 0.8M USD 77 |82 6 105 Knots 500 km 270 N.M. Bell 206L Bell 206L BELL Bell 412HP 16 (4.4%) 4.1M USD 263 10 0 2 | 2 2.2M USD 2.2M USD 765 | 673 Bell 412HP 349 N.M. / 646 km 133 Knots 14 1 | 1 0 | 1 2020 Jun 2020 Jun Sep | Jun Sep | Jun Bell 412EP Source: AMSTAT & ASG AMSTAT Source: 368 N.M. / 681 km 130 Knots 7 14 (3.8%) 4.1M USD 348 13 3 2020 Sep 2020 Sep Sep | Jun Sep | Jun Bell 412EP 356 N.M. / 659 km 140 Knots 9 25 | 21 4.5M USD 5.6M USD 356 | 390 13 | 13 0 | 3 | 75 ASIAN SKY QUARTERLY

(Past 12 Months) (Past

MARKET SUMMARY -- HELICOPTERS SUMMARY MARKET Market Indicators (vs. Last Quarter) Past 12 Months Past 3 Months Past Max Range Max Speed Passengers Typ. TRANSACTION PERFORMANCE No. for Sale No. for Asking Price Avg Days on Market Avg SUPPLY Market Indicators (vs. Last Quarter) Past 12 Months Past 3 Months Past Max Range Max Speed Passengers Typ. PERFORMANCE TRANSACTION No. for Sale No. for Avg Asking Price Avg Days on Market Avg SUPPLY Transaction Level (Past 12 Months) (Past Level Transaction Level Inventory Asking Price Average Days on Market Average Inventory Level Inventory Asking Price Average Days on Market Average Transaction Level Transaction SECOND QUARTER 2020 — SECOND QUARTER 1 27 14 Sep Sep $2.2 $4.1 $4.5 2 27 18 23 18 Jul Jul 1 23 16 3 23 15 Bell 412 EP Average Bell 412 HP May May $2.2 $4.2 $3.9 23 14 3 2 27 14 Mar Mar 1 4 25 17 2 3 27 20 Jan Jan $2.0 $4.5 2020 2020 $3.4 1 26 21 26 24 Nov Nov 3 1 26 24 1 1 27 21 Sep Sep $4.9 $2.0 $3.6 2 1 27 21 5 1 28 20 Jul Jul 3 2 31 21 2 1 33 20 May May $5.2 $2.0 $4.3 1 1 34 17 1 36 15 Mar Mar 2 1 35 16 2 38 15 Jan Jan $5.6 $3.0 $4.6 2019 2019 1 36 16 For Sale For For Sale For 3 38 15 Nov Nov Average Asking Price Average Asking Price For Sale vs. Sold For Sale vs. Sold 38 14 Sold Sold 1 37 14 Sep Sep $5.5 $2.8 $4.6 BELL 429 BELL 412EP/412HP BELL 2018 2018 LEONARDO 2018 2018 $4.7 MARKET SUMMARY --HELICOPTERS 76 AW109SP GRANDNEW $7.8 Sep Sep AW139 28 9 |ASIANSKY QUARTERLY — Sold Sold 28 10 For Sale vs. Sold vs. Sale For For Sale vs. Sold vs. Sale For Average Asking Price Asking Average Average Asking Price Asking Average Nov Nov 25 1 9 2 For Sale For Sale 24 1 8 2 $4.2 2019 2019 $7.5 Jan Jan 26 8 26 3 9 2 Mar Mar 27 1 7 2 SECOND QUARTER 2020 26 1 7 1 $4.8 $7.4 May May 23 2 8 23 3 8 2 Jul Jul 26 8 23 4 9 $4.5 $7.1 Sep Sep 22 1 8 22 12 3 Nov Nov 23 10 1 23 10 1 1 $4.2 2020 2020 $6.6 Jan Jan 22 4 9 1 24 11 2 Mar Mar 23 12 6 1 24 15 $4.4 $6.0 May May 24 17 1 1 23 17 Jul Jul 24 16 1 31 18 $4.7 $5.0 Sep Sep 27 19 2 Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) Average DaysonMarket Average AskingPrice Inventory Level Transaction Level (Past 12Months) SUPPLY Avg DaysonMarket Avg AskingPrice No. for Sale TRANSACTION PERFORMANCE Past 3Months Past 12Months Typ. Passengers Max Speed Max Range SUPPLY Avg DaysonMarket Avg AskingPrice No. for Sale Market Indicators (vs. Last Quarter) Last (vs. Indicators Market TRANSACTION PERFORMANCE Past 3Months Past 12Months Typ. Passengers Max Speed Max Range Market Indicators (vs. Last Quarter) Last (vs. Indicators Market

0 6 2020 Sep 181 4.7M USD (9.9%) 19 2020 Sep 7 130 Knots 480 N.M./889km 3 20 2020 Sep 428 5.0M USD (2.8%) 27 2020 Sep 15 140 Knots 568 N.M./1,052km Source: AMSTAT &ASG 1 6 2020 Jun 216 4.4M USD (9.0%) 17 2020 Jun 1 17 2020 Jun 552 5.7M USD (2.4%) 23 2020 Jun SIKORSKY S76C++ 22 | 22 3.9M USD 4.4M USD 645 | 652 S-76C++ 335 N.M. / 620 km 155 Knots 12 3 | 2 1 | 0 Sep | Jun Sep | Jun S76C+ Source: AMSTAT & ASG AMSTAT Source: Sep | Jun Sep | Jun S-76C+ 335 N.M. / 620 km 155 Knots 12 22 | 22 1.6M USD 1.7M USD 714 | 723 0 | 0 0 | 0 | 77 ASIAN SKY QUARTERLY (Past 12 Months) (Past

MARKET SUMMARY -- HELICOPTERS SUMMARY MARKET Market Indicators (vs. Last Quarter) Past 12 Months Past 3 Months Past Max Range Max Speed Passengers Typ. PERFORMANCE TRANSACTION No. for Sale No. for Avg Asking Price Avg Days on Market Avg SUPPLY Inventory Level Inventory Asking Price Average Days on Market Average Transaction Level Transaction SECOND QUARTER 2020 — SECOND QUARTER 44 Sep $1.6 $3.9 1 45 43 Jul 44 43 S76C++ Average S76C+ May Delivery Hours Only Hours Delivery 2+5 Seat Utility Configuration June 2021/1000 hours Bell Original Warranty Hook Cargo & Equipment - Provisions Floats Emergency & Equipment Kit - Provisions Litter Annual Inspection Recent Door with Access Barrier Filter Inlet EMS Configuration with AAT Stretchers with AAT EMS Configuration Hours Low Very System Cutter Cable Air Conditioning Heavy Duty Blade Pins Dual Controls Skid Shoes Short Protective Oxygen Station $4.4 $1.7 • • • • • • • • AIRBUS HELICOPTERS H130 SN8128 AIRBUS HELICOPTERS H130 HOURS: 62 HOURS TOTAL 220 CYCLES CYCLES: TOTAL • • • • • • • • BELL 206L4 SN52492 DELIVERY HOURS ONLY HOURS: TOTAL 43 40 Mar 41 1 44 Jan $1.7 2020 $4.6 1 45 45 Nov 44 45 Sep $1.7 $4.7 45 1 41 Jul 1 41 45 May $1.8 $4.9 1 42 1 47 Mar 46 1 42 Jan $1.9 $6.6 2019 46 For Sale For 46 Nov Average Asking Price For Sale vs. Sold 1 48 FEATURED AIRCRAFT FEATURED Sold 47 Sep S-76C+ / S-76C++ S-76C+ $1.9 $5.8 2018