0001558370-21-010881 | 10-Q | XBRL Viewer

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Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2021	Aug. 02, 2021
Document Information
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Jun. 30, 2021
Entity File Number	001-38801
Entity Registrant Name	AerSale Corporation
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	84-3976002
Entity Address, Address Line One	121 Alhambra Plaza Suite 1700
Entity Address, City or Town	Coral Gables
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33134
City Area Code	(305)
Local Phone Number	764-3200
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		42,949,261
Entity Central Index Key	0001754170
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q2
Amendment Flag	false
Common stock
Document Information
Title of 12(b) Security	Common stock, $0.0001 par value per share
Trading Symbol	ASLE
Security Exchange Name	NASDAQ
Redeemable warrants
Document Information
Title of 12(b) Security	Redeemable warrants, each warrant exercisable for one share of Common Stock at an exercise price of $11.50
Trading Symbol	ASLEW
Security Exchange Name	NASDAQ

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Current assets:
Cash and cash equivalents	$ 41,808	$ 29,317
Accounts receivable, net of allowance for doubtful accounts of $1,441 and $1,652 as of June 30, 2021 and December 31, 2020	51,011	50,215
Income tax receivable	40
Inventory:
Aircraft, airframes, engines, and parts, net	110,436	85,192
Advance vendor payments	10,742	6,205
Due from related party		474
Deposits, prepaid expenses, and other current assets	2,448	7,560
Total current assets	216,485	178,963
Fixed assets:
Aircraft and engines held for lease, net	74,899	86,844
Property and equipment, net	7,677	7,839
Inventory:
Aircraft, airframes, engines, and parts, net	61,506	55,463
Deferred income taxes	5,992	5,708
Deferred financing costs, net	1,228	367
Deferred customer incentives and other assets, net	288	271
Due from related party	5,421	5,450
Goodwill	19,860	19,860
Other intangible assets, net	27,309	28,364
Total assets	420,665	389,129
Current liabilities:
Accounts payable	16,392	16,364
Accrued expenses	6,268	8,576
Income tax payable	2,338	1,324
Lessee and customer purchase deposits	6,166	2,820
Deferred revenue	2,289	2,595
Total current liabilities	33,453	31,679
Long-term lease deposits	2,968	1,145
Maintenance deposit payments and other liabilities	3,980	3,664
Warrant liability	1,817	1,186
Total liabilities	42,218	37,674
Commitments and contingencies
Stockholders' equity:
Common stock, $0.0001 par value. Authorized 200,000,000 shares; issued and outstanding 42,949,261 and 41,046,216 shares	4	4
Additional paid-in capital	293,019	292,593
Retained earnings	85,424	58,858
Total equity	378,447	351,455
Total liabilities and stockholders' equity	$ 420,665	$ 389,129

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Condensed Consolidated Balance Sheets
Accounts receivable, allowance for doubtful accounts	$ 1,441	$ 1,652
Common Stock, Par or Stated Value Per Share	$ 0.0001	$ 0.0001
Common Stock, Shares Authorized	200,000,000	200,000,000
Shares issued	42,949,261	41,046,216
Shares outstanding	42,949,261	41,046,216

Condensed Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Total revenue	$ 91,921	$ 45,356	$ 150,356	$ 102,491
Cost of sales and operating expenses:
Total cost of sales	61,183	47,484	99,783	89,333
Gross profit (loss)	30,738	(2,128)	50,573	13,158
Selling, general, and administrative expenses	16,966	14,036	30,276	27,237
Payroll support program proceeds	(8,405)	(6,346)	(14,768)	(6,346)
Transaction costs (recovered) incurred		(16)		215
Income (loss) from operations	22,177	(9,802)	35,065	(7,948)
Other income (expenses):
Interest expense, net	(251)	(504)	(509)	(1,040)
Other income, net	155	95	249	152
Change in fair value of warrant liability	(407)		(631)
Total other expenses	(503)	(409)	(891)	(888)
Income (loss) before income tax provision	21,674	(10,211)	34,174	(8,836)
Income tax (expense) benefit	(5,126)	2,273	(7,608)	1,957
Net income (loss)	$ 16,548	$ (7,938)	$ 26,566	$ (6,879)
Earnings (loss) per share - basic and diluted:
Earnings (loss) per share - basic	$ 0.39	$ (214.48)	$ 0.62	$ (185.87)
Earnings (loss) per share - diluted	$ 0.38	$ (214.48)	$ 0.61	$ (185.87)
Products
Total revenue	$ 56,175	$ 9,773	$ 81,301	$ 27,804
Cost of sales and operating expenses:
Total cost of sales	40,387	21,111	54,193	34,550
Leasing
Total revenue	6,366	11,228	12,622	27,010
Cost of sales and operating expenses:
Total cost of sales	2,464	8,811	5,231	16,243
Services
Total revenue	29,380	24,355	56,433	47,677
Cost of sales and operating expenses:
Total cost of sales	$ 18,332	$ 17,562	$ 40,359	$ 38,540

Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Common stock	Additional paid-in capital	Retained earnings	Total
Balance at beginning at Dec. 31, 2019	$ 1	$ 243,221	$ 50,764	$ 293,986
Balance at beginning (in shares) at Dec. 31, 2019	5,285,054
Increase (Decrease) in Equity
Net income (loss)			1,059	1,059
Balance at ending at Mar. 31, 2020	$ 1	243,221	51,823	295,045
Balance at ending (in shares) at Mar. 31, 2020	5,285,054
Balance at beginning at Dec. 31, 2019	$ 1	243,221	50,764	293,986
Balance at beginning (in shares) at Dec. 31, 2019	5,285,054
Increase (Decrease) in Equity
Net income (loss)				(6,879)
Balance at ending at Jun. 30, 2020	$ 1	243,221	43,885	287,107
Balance at ending (in shares) at Jun. 30, 2020	5,285,054
Balance at beginning at Mar. 31, 2020	$ 1	243,221	51,823	295,045
Balance at beginning (in shares) at Mar. 31, 2020	5,285,054
Increase (Decrease) in Equity
Net income (loss)			(7,938)	(7,938)
Balance at ending at Jun. 30, 2020	$ 1	243,221	43,885	287,107
Balance at ending (in shares) at Jun. 30, 2020	5,285,054
Balance at beginning at Dec. 31, 2020	$ 4	292,593	58,858	351,455
Balance at beginning (in shares) at Dec. 31, 2020	41,046,216
Increase (Decrease) in Equity
Issuance of Earn-Out shares		(269)		(269)
Issuance of Earn-Out shares (in shares)	1,855,634
Shares issued upon exercise of warrants		545		545
Shares issued upon exercise of warrants (in shares)	47,411
Net income (loss)			10,018	10,018
Balance at ending at Mar. 31, 2021	$ 4	292,869	68,876	361,749
Balance at ending (in shares) at Mar. 31, 2021	42,949,261
Balance at beginning at Dec. 31, 2020	$ 4	292,593	58,858	351,455
Balance at beginning (in shares) at Dec. 31, 2020	41,046,216
Increase (Decrease) in Equity
Net income (loss)				26,566
Balance at ending at Jun. 30, 2021	$ 4	293,019	85,424	378,447
Balance at ending (in shares) at Jun. 30, 2021	42,949,261
Balance at beginning at Mar. 31, 2021	$ 4	292,869	68,876	361,749
Balance at beginning (in shares) at Mar. 31, 2021	42,949,261
Increase (Decrease) in Equity
Share-based compensation		150		150
Net income (loss)			16,548	16,548
Balance at ending at Jun. 30, 2021	$ 4	$ 293,019	$ 85,424	$ 378,447
Balance at ending (in shares) at Jun. 30, 2021	42,949,261

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

- Definition

Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity.

+ References + Details

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020
Cash flows from operating activities:
Net income (loss)	$ 26,566	$ (6,879)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	6,699	14,635
Amortization of debt issuance costs	257	405
Inventory impairment	5,016	13,349
Impairment of aircraft held for lease		3,036
Provision for doubtful accounts	(151)	439
Deferred income taxes	(284)	(1,964)
Change in fair value of warrant liability	631
Stock-based compensation	150
Changes in operating assets and liabilities, net of acquisition:
Accounts receivable	(1,586)	12,494
Inventory	(33,417)	(5,503)
Deposits, prepaid expenses, and other current assets	5,750	3,976
Deferred customer incentives and other assets	(19)	49
Advance vendor payments	(4,536)	1,240
Accounts payable	28	(1,442)
Income tax payable	(1,013)
Accrued expenses	(3,425)	1,161
Deferred revenue	(306)	(1,931)
Lessee and customer purchase deposits	5,934	5,556
Other liabilities	316	(295)
Net cash provided by operating activities	8,636	38,326
Cash flows from investing activities:
Business acquisition		(16,976)
Proceeds from sale of assets	4,420	3,100
Acquisition of aircraft and engines held for lease, including capitalized cost		(400)
Purchase of property and equipment	(841)	(921)
Net cash provided by (used in) investing activities	3,579	(15,197)
Cash flows from financing activities:
Repayments of 8% Senior Secured Notes		(3,424)
Proceeds from Revolving Credit Facility		104,281
Repayments of Revolving Credit Facility		(104,281)
Cash paid for employee taxes on withholding shares	(269)
Proceeds from exercise of warrants	545
Net cash provided by (used in) financing activities	276	(3,424)
Increase in cash and cash equivalents	12,491	19,705
Cash and cash equivalents, beginning of period	29,317	17,505
Cash and cash equivalents, end of period	41,808	37,210
Supplemental disclosure of cash activities
Income taxes	1,815	132
Interest	308	640
Supplemental disclosure of noncash investing activities
Reclassification of aircraft and aircraft engines inventory (from) to equipment held for lease, net.	$ (7,307)	$ (2,014)

DESCRIPTION OF THE BUSINESS

6 Months Ended

Jun. 30, 2021

DESCRIPTION OF THE BUSINESS

DESCRIPTION OF THE BUSINESS

NOTE A — DESCRIPTION OF THE BUSINESS

Organization

Monocle Acquisition Corporation (“Monocle”) was initially formed on August 20, 2018 for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or similar business combination with one or more businesses.

On December 22, 2020, (the “Closing Date”), Monocle consummated the previously announced business combination pursuant to that certain Amended and Restated Agreement and Plan of Merger, dated September 8, 2020 (the “Merger Agreement”) by and among Monocle, AerSale Corporation (f/k/a Monocle Holdings Inc.), a Delaware corporation (the “Company”), AerSale Aviation, Inc. (f/k/a AerSale Corp.), a Delaware corporation (“AerSale Aviation”), Monocle Merger Sub 1 Inc., a Delaware corporation (“Merger Sub 1”), Monocle Merger Sub 2 LLC, a Delaware limited liability company (“Merger Sub 2”), and Leonard Green & Partners, L.P., a Delaware limited partnership, solely in its capacity as the initial Holder Representative (as defined in the Merger Agreement). The transactions contemplated by the Merger Agreement are referred to herein as the “Merger” or the “Business Combination” and in connection therewith, Monocle merged with and into us, whereby the Company survived the merger and became the successor issuer to Monocle by operation of Rule 12g-3 under the Exchange Act.

Upon the consummation of the Merger: (a) Merger Sub 1 was merged with and into Monocle, with Monocle surviving the merger as a wholly-owned direct subsidiary of the Company (the “First Merger”), and (b) Merger Sub 2 was merged with and into AerSale Aviation, with AerSale Aviation surviving the merger as a wholly-owned indirect subsidiary of the Company (the “Second Merger”). In connection with the closing of the Business Combination (the “Closing”), AerSale Aviation changed its name from “AerSale Corp.” to “AerSale Aviation, Inc.” and the Company changed its name from “Monocle Holdings Inc.” to “AerSale Corporation.” Immediately following the Merger, the Company contributed all of its ownership in Monocle to AerSale Aviation which will continue as a wholly owned subsidiary of the Company.

The Company’s corporate headquarters are based in Miami, Florida, with additional offices, hangars, and warehouses globally.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2021

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE B — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Interim Financial Statements

The accompanying unaudited interim consolidated financial statements have been prepared from the books and records of the Company in accordance with accounting principles Generally Accepted in the United States (“U.S. GAAP”) for interim financial information and Rule 10-01 of Regulation S-X promulgated by the U.S. Securities and Exchange Commission (“SEC”), which permits reduced disclosures for interim periods. Although these interim consolidated financial statements do not include all of the information and footnotes required for complete annual consolidated financial statements, management believes all adjustments, consisting only of normal recurring adjustments, and disclosures necessary for a fair presentation of the accompanying condensed consolidated balance sheets, statements of operations, stockholders’ equity, and cash flows have been made. Unaudited interim results of operations and cash flows are not necessarily indicative of the results that may be expected for the full year. Unaudited interim condensed consolidated financial statements and footnotes should be read in conjunction with the audited consolidated financial statements and footnotes included in Part II, Item 8 of the Annual Report, wherein a more complete discussion of significant accounting policies and certain other information can be found.

Revenue Recognition

Products — Used Serviceable Material Sales (“USM”)

Revenues from sales of USM are measured based on consideration specified within customer contracts, and excludes any sales commissions and taxes collected and remitted to government agencies. The Company recognizes revenue when performance obligations are satisfied by transferring control of a product or service to a customer. The parts are sold at a fixed price with no right of return. In determining the performance obligation, management has identified the promise in the contract to be the shipment of the spare parts to the customer. Title passes to the buyer when the goods are shipped, the buyer is responsible for any loss in transit and the Company has a legal right to payment for the spare parts once shipped. The Company generally sells its USM products under standard 30-day payment terms, subject to certain exceptions. Customers neither have the right to return products nor do they have the right to extended financing. The Company has determined that physical acceptance of the spare parts to be a formality in accordance with ASC Topic 606, “Revenue from Contracts with Customers” (“ASC 606”).

Spare parts revenue is based on a set price for a set number of parts as defined in the purchase order. The performance obligation is completed once the parts have shipped and as a result, all of the transaction price is allocated to that performance obligation. The Company has determined that it is appropriate to recognize spare parts sales at a point in time (i.e., the date the parts are shipped) in accordance with ASC 606.

Products — Whole Asset Sales

Revenues from whole asset sales are measured based on consideration specified in the contract with the customer. The Company and customer enter into an agreement which outlines the place and date of sale, purchase price, condition of the whole asset, bill of sale and the assignment of rights and warranties from the Company to the customer. The Company believes the whole asset holds standalone value to the customer as it is not dependent on any other services for functionality purposes and therefore is distinct within the context of the contract and as described in ASC 606-10. Accordingly, the Company has identified the transfer of the whole asset as the performance obligation. The transaction price is set at a fixed dollar amount per fixed quantity (number of whole assets) and is explicitly stated in each contract. Whole asset sales revenue is based on a set price for a set number of assets, which is allocated to the performance obligation discussed above, in its entirety. The Company has determined the date of transfer to the customer is the date the customer obtains control over the asset and would cause the revenue recognition. Payment is required in full upon a customer’s acceptance of the whole asset on the date of the transfer.

Leasing Revenues

The Company leases flight equipment under operating leases that contain monthly base rent and reports rental income straight line over the life of the lease as it is earned. Additionally, the Company’s leases provide for supplemental rent, which is calculated based on actual hours or cycles of utilization and, for certain components, based on the amount of time until maintenance of that component is required. In certain leases, the Company records supplemental rent paid by the lessees as maintenance deposit payment liabilities in recognition of the Company’s contractual commitment to reimburse qualifying maintenance. Reimbursements to the lessees upon receipt of evidence of qualifying maintenance work are charged against the existing maintenance deposit payments liabilities. In leases where the Company is responsible for performing certain repairs or replacement of aircraft components or engines, supplemental rent is recorded as revenue in the period earned. In the event of premature lease termination or lessee default on the lease terms, revenue recognition will be discontinued when outstanding balances are beyond the customers’ deposits held. Payment terms for leased flight equipment are due upon receipt.

Service Revenues

Service revenues are recognized as performance obligations when they are fulfilled and the benefits are transferred to the customer. At contract inception, the Company evaluates if the contract should be accounted for as a single performance obligation or if the contract contains multiple performance obligations. In some cases, the Company’s service contract with the customer is considered one performance obligation as it includes factors such as the good or service being provided is significantly integrated with other promises in the contract, the service provided significantly modifies or customizes the other good or service or the goods or services are highly interdependent or interrelated with each other. If the contract has more than one performance obligation, the Company determines the standalone price of each distinct good or service underlying each performance obligation and allocates the transaction price based on their relative standalone selling prices. The transaction price of a contract, which can include both fixed and variable amounts, is allocated to each performance obligation identified. Some contracts contain variable consideration, which could include incremental fees or penalty provisions related to performance. Variable consideration that can be reasonably estimated based on current assumptions and historical information is included in the transaction price at the inception of the contract but limited to the amount that is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. Variable consideration that cannot be reasonably estimated is recorded when known.

For most service contracts, performance obligations are satisfied over time as work progresses based on transfer of control of products and services to our customers. The Company receives payments from our customers based on billing schedules or contract terms.

For performance obligations that are satisfied over time, the Company measures progress in a manner that depicts the performance of transferring control to the customer. As such, the Company utilizes the input method of cost-to-cost to recognize revenue over time as this depicts when control of the promised goods or services are transferred to the customer. Revenue is recognized based on the relationship of actual costs incurred to date to the estimated total cost at completion of the performance obligation. The Company is required to make certain judgments and estimates, including estimated revenues and costs, as well as inflation and the overall profitability of the arrangement. Key assumptions involved include future labor costs and efficiencies, overhead costs and ultimate timing of product delivery. Differences may occur between the judgments and estimates made by management and actual program results. Under most of the Company’s Maintenance, Repair and Overhaul (“MRO”) contracts, if the contract is terminated for convenience, the Company is entitled to payment for items delivered, fair compensation for work performed, the costs of settling and paying other claims and a reasonable profit on the costs incurred or committed.

Changes in estimates and assumptions related to our arrangements accounted for using the input method based on labor hours are recorded using the cumulative catchup method of accounting. These changes are primarily adjustments to the estimated profitability for our long term programs where the Company provides MRO services.

The Company has elected to use certain practical expedients permitted under ASC 606. Shipping and handling fees and costs incurred associated with outbound freight after control over a product has transferred to a customer are accounted for as a fulfillment cost, are included in cost of sales in our condensed consolidated statements of operations and are not considered a performance obligation to our customers. The Company’s reported sales on our condensed consolidated statements of operations are net of any sales or related non income taxes. The Company also utilizes the “as invoiced” practical expedient in certain cases where performance obligations are satisfied over time and the invoiced amount corresponds directly with the value the Company is providing to the customer.

Revision of Prior Period Financial Statements

During the six months ended June 30, 2021, the Company identified and corrected immaterial errors that affected certain of its previously issued consolidated financial statements. These errors related to the misapplication of generally accepted accounting principles in the United States in connection with the classification of the Company’s private warrants as equity. The SEC released a Public Statement on April 12, 2021 noting that when one or more features common to warrants in SPAC transactions is included in a warrant, the warrant “should be classified as a liability measured at fair value, with changes in fair value each period reported in earnings.” Following review of the SEC’s statement, the Company concluded that its private warrants do not meet the conditions to be classified as equity and instead, the private warrants

meet the definition of a derivative under Accounting Standards Codification (“ASC”) 815 “Derivatives and Hedging.” This requires the Company to record the private warrants as a liability measured at fair value on the Company’s Condensed Consolidated Balance Sheets with the changes in fair value each period reported in earnings. As a result, the Company recorded $0.4 million and $0.6 million of expense in the three and six month periods ended June 30, 2021, reflected as change in fair value of warrant liability. Accordingly, the Company revised its December 31, 2020 financial statements by recognizing the private warrants as a liability upon the consummation of the Business Combination on December 22, 2020 in the amount of $1.2 million with a corresponding reduction to additional paid-in capital and retained earnings of $0.8 million and $0.4 million, respectively.

The Company determined the impact of the error related to the accounting treatment of private warrants had an immaterial impact with respect to the Company’s consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2020. However, in order to correctly present the immaterial errors noted above, previously issued comparative financial statements have been revised as of the quarter ended March 31, 2021.

New Accounting Pronouncements Not Yet Adopted

In February 2016, the FASB issued ASU 2016-02 Leases (Topic 842), which generally requires companies to recognize operating and financing lease liabilities and corresponding right-of-use assets on the balance sheet. In July 2018, FASB issued ASU No. 2018-10, “Codification Improvements to Topic 842, Leases” and ASU No. 2018-11, “Leases (Topic 842): Targeted Improvements.” Although early adoption is permitted, the Company plans to adopt Topic 842 during the first quarter of 2022, on a modified retrospective basis. The Company is currently evaluating the impact this guidance will have on our consolidated financial statements and related disclosures.

In June 2016, the FASB issued ASU No. 2016-13 (“ASU 2016-13”), “Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” In November 2018, FASB issued ASU No. 2018-19, “Codification Improvements to Topic 326, Financial Instruments — Credit Losses,” which amends the scope and transition requirements of ASU 2016-13. Topic 326 requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions and reasonable and supportable forecasts that affect the collectability of the reported amount. Topic 326 will become effective for the Company beginning January 1, 2023, with early adoption permitted, on a modified retrospective basis. The Company is currently evaluating the impact this guidance will have on our consolidated financial statements and related disclosures.

Payroll Support Programs

The Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) was signed into law on March 27, 2020 and is intended to assist the economy by issuing a relief package to preserve jobs in industries adversely impacted by the COVID-19 outbreak. On June 8, 2020, the Company entered into an agreement with the U.S. Department of the Treasury to receive $16.4 million in emergency relief through the CARES Act Payroll Support Program to be paid in installments. The proceeds of the grant are recorded within accrued expenses when received and are recognized as payroll support program proceeds in the condensed consolidated statement of operations over the periods that the funds are intended to compensate. During the six months ended June 30, 2021, we received the remaining balance of $3.7 million in grant proceeds under the CARES Act Payroll Support Program and this amount has been recognized as payroll support program proceeds in the condensed consolidated statement of operations. No amounts were received under the CARES Act Payroll Support Program during the three months ended June 30, 2021.

As part of the Payroll Support Program Extension Law, we entered into a new agreement with the U.S. Department of the Treasury on March 4, 2021 for the receipt of relief funds of $5.5 million. During the six months ended June 30, 2021, we received $5.5 million in grant proceeds under the Payroll Support Program Extension Law. During the three- and six-month periods ended June 30, 2021, $2.9 million and $5.5 million was recognized as payroll support program proceeds in the condensed consolidated statements of operations.

Pursuant to the American Rescue Plan Act of 2021 (“ARP”), we entered into a new agreement with the U.S. Department of the Treasury on April 16, 2021 for the receipt of relief funds of an additional $5.5 million. This amount was recognized as payroll support program proceeds during the three- and six-month periods ended June 30, 2021 in the condensed consolidated statements of operations.

In connection with the financial assistance we have received under the Payroll Support Program, we are required to comply with certain provisions of the CARES Act, including the requirement that funds provided pursuant to the Payroll Support Program be used exclusively for the continuation of payment of employee wages, salaries and benefits and the requirement against involuntary terminations, furloughs and reductions in employee pay rates and benefits from the signing date of the Payroll Support Program agreement through September 30, 2021. In addition, we are subject to provisions prohibiting the repurchase of common stock and the payment of common stock dividends through September 30, 2022, as well as limitations on the payment of certain employee compensation through April 1, 2023. These restrictions may affect our operations and if we do not comply with these provisions, we may be required to reimburse up to 100% of any previously received relief funds.

SIGNIFICANT RISKS AND UNCERTAINTIES

6 Months Ended

Jun. 30, 2021

SIGNIFICANT RISKS AND UNCERTAINTIES

SIGNIFICANT RISKS AND UNCERTAINTIES - Impact of Coronavirus COVID-19

NOTE C — SIGNIFICANT RISKS AND UNCERTAINTIES

Impact of Coronavirus (“COVID-19”)

COVID-19 has been declared a global health pandemic by the World Health Organization. In early March 2020, as AerSale began to see the impacts to its customers, the Company took decisive actions to position itself for the short-term impacts of COVID-19, while allowing the Company the flexibility to quickly pursue the opportunities that would follow. The Company cancelled approximately $20 million of feedstock opportunities under negotiation, as it evaluated the impacts of COVID-19 on asset valuations. The Company also reexamined its structure and executed measures in 2020 to adjust the business through strategic headcount reductions and suspension of various other initiatives, resulting in reduced costs of over $20 million on an annualized basis.

While the duration and extent of the COVID-19 pandemic depends on future developments that cannot be accurately predicted at this time, such as the extent and effectiveness of containment actions, and future restrictions due to different strains, or variants of COVID-19, it has already had an adverse effect on the global economy and the ultimate societal and economic impact of the COVID-19 pandemic remains unknown.

REVENUE

6 Months Ended

Jun. 30, 2021

REVENUE

REVENUE

NOTE D — REVENUE

The timing of revenue recognition, customer billings and cash collections results in a contract asset or contract liability at the end of each reporting period. Contract assets consist of unbilled receivables or costs incurred where revenue recognized over time exceeds the amounts billed to customers. Contract liabilities include advance payments and billings in excess of revenue recognized. Certain customers make advance payments prior to the satisfaction of performance obligations on the contract. These amounts are recorded as contract liabilities until such performance obligations are satisfied. Contract assets and contract liabilities are determined on a contract by contract basis.

Contract assets are as follows (in thousands):


	June 30, 2021		December 31, 2020		Change
Contract assets	$	19,975	$	20,431	$	(456)

Contract assets are reported within accounts receivable on our condensed consolidated balance sheets. Changes in contract assets primarily results from the timing difference between our performance of services. Contract liabilities are reported as deferred revenue on our condensed consolidated balance sheets and amounted to $2.6 million as of December 31, 2020, of which $2.2 million was related to contract liabilities for services performed. For the three and six months ended June 30, 2021, the Company recognized as revenue $0.4 and $1.4 million of contract liabilities for services performed as the timing between customer payments and our performance of the services is generally no longer than six months.

Disaggregation of Revenue

The Company reports revenue by segment. The following tables present revenue by segment, as well as a reconciliation to total revenue for the three and six months ended June 30, 2021 and 2020 (in thousands):


	Three months ended June 30,						Six months ended June 30,
	2021						2021
	Asset Management						Asset Management
	Solutions		Tech Ops		Total Revenues		Solutions		Tech Ops		Total Revenues
USM	$	11,244	$	1,116	$	12,360	$	20,469	$	2,259	$	22,728
Whole asset sales		42,689		-		42,689		56,460		-		56,460
Engineered solutions		-		1,126		1,126		-		2,113		2,113
Total products		53,933		2,242		56,175		76,929		4,372		81,301
Leasing		6,366		-		6,366		12,622		-		12,622
Services		-		29,380		29,380		-		56,433		56,433
Total revenues	$	60,299	$	31,622	$	91,921	$	89,551	$	60,805	$	150,356


	Three months ended June 30,						Six months ended June 30,
	2020						2020
	Asset Management						Asset Management
	Solutions		Tech Ops		Total Revenues		Solutions		Tech Ops		Total Revenues
USM	$	6,520	$	150	$	6,670	$	21,569	$	1,474	$	23,043
Whole asset sales		3,103		-		3,103		3,103		-		3,103
Engineered solutions		-		-		-		-		1,658		1,658
Total products		9,623		150		9,773		24,672		3,132		27,804
Leasing		11,228		-		11,228		27,010		-		27,010
Services		-		24,355		24,355		-		47,677		47,677
Total revenues	$	20,851	$	24,505	$	45,356	$	51,682	$	50,809	$	102,491

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI http://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (e)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

+ Details

INVENTORY

6 Months Ended

Jun. 30, 2021

INVENTORY

INVENTORY

NOTE E — INVENTORY

Following are the major classes of inventory as of the below dates (in thousands):


	June 30, 2021		December 31, 2020
Used serviceable materials	$	62,302	$	63,277
Work-in-process		20,518		20,611
Whole assets		89,122		56,767
	$	171,942		140,655
Less short term		(110,436)		(85,192)
Long term	$	61,506	$	55,463

The Company recorded an inventory reserve of $4.8 million for the three and six months ended June 30, 2021, and an inventory reserve of $12.9 million for the three and six months ended June 30, 2020. These amounts are included in cost of products in the accompanying condensed consolidated statements of operations, due to the Company’s evaluation of the inventory’s net realizable value.

The Company recorded inventory scrap loss reserves of $0.2 million and $0.1 million for the three months ended June 30, 2021 and 2020, respectively. The Company recorded inventory scrap loss reserves of $0.2 million and $0.5 million for the six months ended June 30, 2021 and 2020, respectively, each of which was included in cost of products in the accompanying condensed consolidated statements of operations.

INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2021

INTANGIBLE ASSETS

INTANGIBLE ASSETS

NOTE F — INTANGIBLE ASSETS

In accordance with ASC 350, Intangibles — Goodwill and Other, goodwill and other intangible assets deemed to have indefinite lives are not amortized, but are subject to annual impairment tests. The Company reviews and evaluates our goodwill and indefinite life intangible assets for potential impairment at a minimum annually or more frequently if circumstances indicate that impairment is possible.

The Company determined the fair value of assets acquired and liabilities assumed using a variety of methods. An income approach based on discounted cash flows was used to determine the values of our trademarks, certifications, customer relationships and FAA certificates. The assumptions the Company used to estimate the fair value of our reporting units are based on historical performance, as well as forecasts used in our current business plan and require considerable management judgment

The Company’s goodwill and intangible assets as defined by ASC 350 is related to our subsidiaries, AerSale Component Solutions (d/b/a AerSale Landing Gear Solutions) (“ALGS”), Avborne Component Solutions (d/b/a AerSale Component Solutions) (“ACS”), and Aircraft Composite Technologies (“ACT”), which are included in the Tech Ops segment, as well as Qwest, which is included under the Asset Management Solutions segment.

Goodwill and other intangibles as of the below dates are (in thousands):


	June 30, 2021		December 31, 2020
Qwest:
FAA Certifications	$	724	$	724
Goodwill		13,416		13,416
ALGS:
FAA Certifications		710		710
Goodwill		379		379
ACS:
Trademarks		600		600
FAA Certifications		7,300		7,300
Goodwill		63		63
ACT:
Trademarks		200		200
FAA Certificates		796		796
Goodwill		6,002		6,002
Total intangible assets with indefinite lives	$	30,190	$	30,190

As a result of the COVID-19 pandemic and its impact on the aviation industry, the Company performed a qualitative impairment analysis as of June 30, 2020 on the indefinite lived intangible assets and concluded there was no impairment. Additionally, the Company performed an impairment analysis on the goodwill for both the Asset Management Solutions and Tech Ops segments and concluded that goodwill was not impaired as of June 30, 2020.

Intangible assets with definite useful lives are amortized on a straight-line basis over their estimated useful lives. Intangible assets with definite lives as of the below dates are as follows (in thousands):


	Useful Life
	In Years	June 30, 2021		December 31, 2020
Qwest:
Customer relationships	10	$	7,600	$	8,083
ALGS:
Customer relationships	10		80		90
ACS:
Customer relationships	10		1,558		1,663
ACT:
Customer relationships	10		7,741		8,198
Total intangible assets with definite lives		$	16,979	$	18,034

Total amortization expense amounted to $0.5 million and $0.7 million for the three months ended June 30, 2021 and 2020, respectively. Total amortization expense amounted to $1.1 million and $1.0 million for the six months ended June 30, 2021 and 2020, respectively. Accumulated amortization amounted to $4.0 million and $3.0 million as of June 30, 2021 and December 31, 2020, respectively.

Other intangible assets are reviewed at least annually or more frequently if any event or change in circumstance indicates that an impairment may have occurred. As a result of the COVID-19 pandemic and its impact on the aviation industry, the Company performed an impairment analysis as of June 30, 2020 on the definite-lived intangible assets and concluded there was no impairment.

There was no goodwill activity during the six months ended June 30, 2021. For the six-month period ended June 30, 2020, goodwill increased by $6.0 million due to the acquisition of ACT.

PROPERTY AND EQUIPMENT, NET

6 Months Ended

Jun. 30, 2021

PROPERTY AND EQUIPMENT, NET

PROPERTY AND EQUIPMENT, NET

NOTE G — PROPERTY AND EQUIPMENT, NET

Property and equipment, net, as of the below dates consisted of the following (in thousands):


	Useful Life
	In Years	June 30, 2021		December 31, 2020
Tooling and equipment	7 - 15	$	13,303	$	13,465
Furniture and other equipment	5		7,651		7,379
Computer software	5		2,026		2,378
Leasehold improvements	3 - 6		3,470		3,314
Equipment under capital lease	5		192		197
			26,642		26,733
Less accumulated depreciation			(18,965)		(18,894)
		$	7,677	$	7,839

Depreciation expense, which includes amortization of equipment under capital lease, amounted to $0.5 million and $0.5 million for the three months ended June 30, 2021 and 2020, respectively. Depreciation expense, which includes amortization of equipment under capital lease, amounted to $1.0 million and $1.1 million for the six months ended June 30, 2021 and 2020, respectively.

As a result of the COVID-19 pandemic and its impact on the aviation industry, the Company performed an impairment analysis as of June 30, 2020 on the property, plant and equipment and concluded there was no impairment.

LEASE RENTAL REVENUES AND AIRCRAFT AND ENGINES HELD FOR LEASE

6 Months Ended

Jun. 30, 2021

LEASE RENTAL REVENUES AND AIRCRAFT AND ENGINES HELD FOR LEASE

LEASE RENTAL REVENUES AND AIRCRAFT AND ENGINES HELD FOR LEASE

NOTE H — LEASE RENTAL REVENUES AND AIRCRAFT AND ENGINES HELD FOR LEASE

Aircraft and engines held for operating leases, net, as of the below dates consisted of the following (in thousands):


	June 30, 2021		December 31, 2020
Aircraft and engines held for operating leases	$	210,593	$	228,942
Less accumulated depreciation		(135,694)		(142,098)
	$	74,899	$	86,844

Total depreciation expense amounted to $2.2 million and $5.4 million for the three months ended June 30, 2021 and 2020, respectively. Total depreciation expense amounted to $4.6 million and $12.5 million for the six months ended June 30, 2021 and 2020, respectively, and is included in cost of leasing in the condensed consolidated statements of operations.

Supplemental rents recognized as revenue totaled $1.8 million and $2.1 million for the three months ended June 30, 2021 and 2020, respectively. Supplemental rents recognized as revenue totaled $2.9 million and $7.6 million for the six months ended June 30, 2021 and 2020, respectively.

The Company’s current operating lease agreements for flight equipment on lease expire over the next month to three years. The amounts in the following table are based upon the assumption that flight equipment under operating leases will remain on lease for the length of time specified by the respective lease agreements. Minimum future annual lease rentals contracted to be received under existing operating leases of flight equipment at were as follows (in thousands):


Year ending December 31:
Remainder of 2021	$	9,950
2022		10,947
2023		2,008
Total minimum lease payments	$	22,905

ACCRUED EXPENSES

6 Months Ended

Jun. 30, 2021

ACCRUED EXPENSES

ACCRUED EXPENSES

NOTE I — ACCRUED EXPENSES

The following is a summary of the components of accrued expenses as of the below dates (in thousands):


	June 30, 2021		December 31, 2020
Accrued compensation and related benefits	$	4,642	$	6,624
Accrued legal fees		53		18
Commission fee accrual		74		103
Accrued federal, state and local taxes and fees		184		130
Other		1,315		1,701
	$	6,268	$	8,576

WARRANT LIABILITY

6 Months Ended

Jun. 30, 2021

WARRANT LIABILITY

WARRANT LIABILITY

NOTE J – WARRANT LIABILITY

Monocle issued certain public warrants in 2018 which, upon the Closing, were converted into AerSale warrants. Each of the Company’s warrants entitles the registered holder to purchase one share of the Company’s common stock at a price of $11.50 per share. The warrants will expire at 5:00 p.m., New York City time, on the fifth anniversary of the completion of the Merger, or earlier upon redemption or liquidation. Warrants to purchase a total of 17,952,589 shares of the Company’s common stock were outstanding as of June 30, 2021, of which 750,000 warrants were issued to founders in a private placement (the “Private Warrants”) and subject to a twelve- month lock-up period from the date of the Merger. The remaining are public warrants and are exercisable immediately.

The Private Warrants include provisions that affect the settlement amount. Such variables are outside of those used to determine the fair value of a fixed-for-fixed instrument, and as such, the warrants do not meet the criteria for equity treatment under guidance contained in ASC Topic 815, “Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in a Company’s Own Stock.” The Company classifies the Private Warrants as a liability at their fair value subject to re-measurement at each balance sheet date and adjusted at each reporting period until exercised or expired, and any change in fair value is recognized in the Company's condensed consolidated statement of operations. The fair value of the private warrants is determined using the market price of the public warrants adjusted for their lack of liquidity.

EARNINGS PER SHARE

6 Months Ended

Jun. 30, 2021

EARNINGS PER SHARE

EARNINGS PER SHARE

NOTE K — EARNINGS PER SHARE

The computation of basic and diluted earnings per share (“EPS”) is based on the weighted average number of common shares outstanding during each period.

The following table provides a reconciliation of the computation for basic and diluted earnings per share for the three and six months ended June 30, 2021 and 2020, respectively (in thousands, except share and per share data):


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Net income (loss)	$	16,548	$	(7,938)	$	26,566	$	(6,879)
Reversal of loss on change in value of warrant liability		407		-		631		-
Net income attributable to common shareholders for EPS - diluted	$	16,955	$	(7,938)	$	27,197	$	(6,879)

Weighted-average number of shares outstanding - basic		42,949,261		37,010		42,584,793		37,010
Additional shares from assumed stock-settled restricted stock units		237,243		-		186,420		-
Additional shares from assumed exercise of warrants		1,063,357		-		1,469,201		-
Weighted-average number of shares outstanding - diluted		44,249,861		37,010		44,240,414		37,010

Earnings per share – basic:	$	0.39	$	(214.48)	$	0.62	$	(185.87)
Earnings per share – diluted:	$	0.38	$	(214.48)	$	0.61	$	(185.87)

BUSINESS SEGMENTS

6 Months Ended

Jun. 30, 2021

BUSINESS SEGMENTS

BUSINESS SEGMENTS

NOTE L — BUSINESS SEGMENTS

Consistent with how our chief operating decision maker (Chairman and Chief Executive Officer) evaluates performance and utilizes gross profit as a profitability measure, the Company reports its activities in two business segments:

●

Asset Management Solutions — comprised of activities to extract value from strategic asset acquisitions through leasing, trading, or disassembling for product sales.

●

Tech Ops — comprised of MRO activities; and product sales of internally developed engineered solutions and other serviceable products.

The Asset Management Solutions segment provides short-term and long-term leasing solutions of aircraft and jet engines to passenger and cargo operators worldwide. Assets considered to be at or near the end of their useful lives, supplied by our leasing portfolio or acquisitions, are analyzed for return maximization to assess whether they will be traded as whole assets or disassembled and sold as individual spare parts and components.

The Tech Ops segment consists of aftermarket support and services businesses that provide maintenance support for aircraft and aircraft components, and sale of engineered solutions. Our MRO business also engages in longer term projects such as aircraft modifications, cargo conversions of wide-body aircraft, and aircraft storage. The segment also includes MRO of landing gear, thrust reversers, and other components. Cost of sales consists principally of the cost of product, direct labor, and overhead. Our engineered solutions revenues consist of sales of products internally developed as permitted by Supplemental Type Certificates issued by the FAA. These products are proprietary in nature and function as non-original equipment manufacturer solutions to airworthiness directives and other technical challenges for operators. In order to develop these products, the Company engages in research and development activities. Periodically, the Company’s Tech Ops segment engages in the repair and sale of used serviceable materials through their ability to overhaul existing inventory.

The accounting policies for the segments are the same as those described in Note B to our consolidated financial statements included in our annual report. Gross profit (loss) is calculated by subtracting cost of sales from sales. The assets and certain expenses related to corporate activities are not allocated to the segments. Our reportable segments are aligned principally around the differences in products and services. The segment reporting excludes the allocation of selling, general and administrative expenses, interest expense and income tax expense.

Selected financial information for each segment for the three and six months ended June 30, 2021 and 2020 is as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Revenues
Asset Management Solutions
Aircraft	$	24,269	$	10,602	$	34,721	$	24,840
Engine		36,030		10,249		54,830		26,842
		60,299		20,851		89,551		51,682
Tech Ops
MRO services		29,380		24,355		56,433		47,677
Product sales		2,242		150		4,372		3,132
		31,622		24,505		60,805		50,809
Total	$	91,921	$	45,356	$	150,356	$	102,491


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Gross profit (loss)
Asset Management Solutions
Aircraft	$	5,178	$	(9,924)	$	9,641	$	(6,262)
Engine		13,921		1,017		23,045		9,122
		19,099		(8,907)		32,686		2,860
Tech Ops
MRO services		11,048		6,793		16,074		9,137
Product sales		591		(14)		1,813		1,161
		11,639		6,779		17,887		10,298
Total	$	30,738	$	(2,128)	$	50,573	$	13,158

The following table reconciles segment gross profit (loss) to net income (loss) for the three and six months ended June 30, 2021 and 2020 (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Segment gross profit (loss)	$	30,738	$	(2,128)	$	50,573	$	13,158
Selling, general and administrative expenses		(16,966)		(14,036)		(30,276)		(27,237)
Payroll support program proceeds		8,405		6,346		14,768		6,346
Transaction costs		-		16		-		(215)
Interest expense, net		(251)		(504)		(509)		(1,040)
Other income, net		155		95		249		152
Change in fair value of warrant liability		(407)		-		(631)		-
Income tax (expense) benefit		(5,126)		2,273		(7,608)		1,957
Net income (loss)	$	16,548	$	(7,938)	$	26,566	$	(6,879)

Intersegment sales include amounts invoiced by a segment for work performed for another segment. Amounts are based on actual work performed or products sold and agreed-upon pricing which is intended to be reflective of the arm’s length value of the contribution made by the supplying business segment. All intersegment transactions have been eliminated upon consolidation. Intersegment revenue for the three and six months ended June 30, 2021 and 2020, is as follows (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Asset Management Solutions	$	536	$	832	$	1,983	$	1,102
Tech Ops		1,328		542		3,486		1,461
Total intersegment revenues	$	1,864	$	1,374	$	5,469	$	2,563

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

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+ Details

COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2021

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

NOTE M— COMMITMENTS AND CONTINGENCIES

Litigation

The Company may be involved in litigation incidental to the operation of the business. The Company intends to vigorously defend all matters in which the Company is named as defendant and, for insurable losses, maintain significant levels of insurance to protect against adverse judgments, claims or assessments that may affect the Company. Although the adequacy of existing insurance coverage of the outcome of any legal proceedings cannot be predicted with certainty, based on the current information available, the Company does not believe the ultimate liability associated with known claims or litigation, if any, in which the Company is involved will materially affect the Company’s condensed consolidated financial condition or results of operations.

Lease Commitments

The Company leases office space, warehouses, hangars, computers and equipment in connection with its operations under various operating leases, many of which contain escalation clauses.

Future minimum lease payments under non-cancelable operating leases (with initial lease terms in excess of one year) are (in thousands):


Year ending December 31:
Remainder of 2021	$	2,397
2022		3,591
2023		2,755
2024		2,308
2025		1,811
2026		1,846
Thereafter		2,601
Total minimum lease payments	$	17,309

Expenses incurred under the operating lease agreements was $1.6 million for each of the three months ended June 30, 2021 and 2020, respectively. Expenses incurred under the operating lease agreements was $3.2 million and $3.1 million for the six months ended June 30, 2021 and 2020, respectively. Operating lease expense is recognized on a straight-line basis over the term of the lease, including any option periods, as appropriate. The same lease term is used for lease classification, the amortization period of related leasehold improvements, and the estimation of future lease commitments.

BUSINESS COMBINATION

6 Months Ended

Jun. 30, 2021

BUSINESS COMBINATION

BUSINESS COMBINATION

NOTE N — BUSINESS COMBINATION

On January 7, 2020 the Company acquired all of the outstanding shares of Aircraft Component Technologies, Inc. (ACT), a Florida corporation located in Miami, Florida, for $17.0 million in cash. The results of ACT operations have been included in the condensed consolidated financial statements since the acquisition date. All assets and liabilities of ACT were recorded at their fair market value, and to the extent that the purchase cost exceeded the fair market value of the net assets, that excess was recorded as goodwill, all of which is deductible for federal income tax purposes. The goodwill is attributable to the general reputation of the business and the collective experience of ACT’s management and employees. This business operates as part of our Tech Ops segment. ACT’s revenues and income from operations for the three months ended June 30, 2020 were $1.8 million and $0.4 million, respectively, and from January 7, 2020 through June 30, 2020 were $4.0 million and $1.1 million, respectively. The purchase price for ACT was allocated as follows (in thousands):


	Acquisition
	Date
	Fair Values
Accounts receivable	$	1,442
Deposits, prepaid expenses, and other current assets		22
Property and equipment		381
Other intangible assets		10,096
Goodwill		6,002
Accounts payable		(134)
Accrued expenses		(833)
Total purchase price	$	16,976

The intangible assets included above consist of the following (in thousands):


	Fair Value
Trademark and trade name (indefinite lived)	$	200


	Fair Value
FAA part 145 certificate (indefinite lived)	$	796


	Useful Life In
	Years	Fair Value
Customer relationships	10	$	9,100

The acquisition of ACT did not have a material impact on the consolidated results of operations for the three- and six-month period ended June 30, 2020.

STOCKHOLDERS' EQUITY

6 Months Ended

Jun. 30, 2021

STOCKHOLDERS' EQUITY

STOCKHOLDERS' EQUITY

NOTE O — STOCKHOLDERS’ EQUITY

The Consolidated Statements of Stockholders’ Equity reflect the Reverse Recapitalization as defined in Item 8, Note B of the Annual Report. As AerSale Aviation was deemed the accounting acquirer in the Reverse Recapitalization with Monocle, all periods prior to the consummation date reflect the balances and activity of AerSale Aviation. The share activity (preferred stock and common stock) and per share amounts in the Consolidated Statements of Stockholders’ Equity as of December 31, 2019, from the previously reported audited consolidated financial statements of AerSale Aviation, were retroactively adjusted using the recapitalization exchange ratio of 74.0%.

Common Stock

Prior to the Merger, holders of AerSale Aviation’s common stock were entitled to one vote per share, and to receive dividends and, upon liquidation or dissolution, were entitled to receive all assets available for distribution to stockholders. The holders had no preemptive or other subscription rights and there were no redemption or sinking fund provisions with respect to such shares. Common stock was subordinated to the preferred stock with respect to dividend rights and rights upon liquidation, winding up, and dissolution of the Company.

Upon the consummation of the Merger, holders of AerSale Aviation’s common stock received shares of the Company’s common stock at $10.00 per share as merger consideration. The Company’s common stock consist of $0.0001 par value, 200,000,000 shares authorized, of which 42,949,261 shares were issued and outstanding as of June 30, 2021.

Earn-Out Shares

Upon consummation of the Merger and in each case on or prior to the fifth anniversary of the Closing, the pre-closing holders of AerSale Aviation’s common stock and the holders of in-the-money SARs (as defined in the Merger Agreement) received a contingent right to receive up to 3,000,000 additional shares of the Company’s common stock. Additionally, certain pre-closing holders of AerSale Aviation’s common stock received a contingent right to receive 746,876 shares of the Company’s common stock. Effective February 8, 2020, the contingency event related to the Minimum Target Earn-Out Shares was met and 1,855,634 shares were issued.

The Company determined the Earn-Out Shares to be classified as equity under ASC Topic 815, “Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in a Company’s Own Stock” as the contingent right is indexed to the Company’s stock and accordingly, the accrual of the Earn-Out shares as of June 30, 2021 had no impact on the Company’s consolidated financial statements.

Unvested Founder Shares

Upon the Merger, certain pre-closing holders of AerSale Corporation’s common stock agreed to defer the vesting of an aggregate of 700,000 shares (the “Unvested Founder Shares”), half of which will vest at such time as the Minimum Target (as defined in the Merger Agreement) and the other half of which will vest at the Maximum Target (as defined in the Merger Agreement). Effective February 8, 2021, the contingency event related to the Minimum Target was met and half of the Unvested Founder Shares vested. Unvested Founder Shares that have not vested on or prior to the fifth anniversary of the Closing Date will be forfeited.

2020 Equity Incentive Plan

The Company maintains a 2020 Equity Incentive Plan (the “2020 Plan”) and has registered 4,200,000 shares of common stock issuable under the Plan. The 2020 Plan authorizes discretionary grants of incentive stock options to employees of the Company and its qualifying subsidiaries. The 2020 Plan also authorizes discretionary grants of non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalents or other equity or cash-based awards to employees and consultants of the Company and its subsidiaries and to members of the Board of Directors of the Company. To the extent that an award under the 2020 Plan expires, is cancelled, forfeited, terminated, settled in cash or is otherwise settled without issuance of the full number of shares to which it relates, will become or again be available for awards under the 2020 Plan. The 2020 Plan is administered by the Company's Compensation Committee. The Compensation Committee has complete, full and final authority to: designate participants; determine the types of awards to be granted; determine the terms of awards; interpret and administer the 2020 Plans and any agreements and awards thereunder.

Restricted stock unit activity under the 2020 Plan for the six months ended June 30, 2021 was as follows


					Weighted Average
			Weighted Average		Remaining Contractual
	Amount		Grant Date Fair Value		Life (Years)
Outstanding at December 31, 2020		—	$	—	$	—
Granted		1,702,280		10.10		2.49
Outstanding June 30, 2021		1,702,280	$	10.10	$	2.49

The Company’s restricted stock units include 1,595,000 performance-based awards that have vesting provisions subject to both time vesting and the achievement of certain business milestones, while the remaining 107,280 awards vest over a period ranging from one to three years. As of June 30, 2021, no expense has been recognized for these performance-based awards given that the milestone achievements for these awards have not yet been deemed probable for accounting purposes.

2020 Employee Stock Purchase Plan

The Company also maintains a 2020 Employee Stock Purchase Plan (the “ESPP”) and has registered 500,000 shares of common stock issuable under the ESPP. The Company has not issued shares pursuant to the ESPP as of June 30, 2021.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	Jun. 30, 2021
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Interim Financial Statements	Interim Financial Statements The accompanying unaudited interim consolidated financial statements have been prepared from the books and records of the Company in accordance with accounting principles Generally Accepted in the United States (“U.S. GAAP”) for interim financial information and Rule 10-01 of Regulation S-X promulgated by the U.S. Securities and Exchange Commission (“SEC”), which permits reduced disclosures for interim periods. Although these interim consolidated financial statements do not include all of the information and footnotes required for complete annual consolidated financial statements, management believes all adjustments, consisting only of normal recurring adjustments, and disclosures necessary for a fair presentation of the accompanying condensed consolidated balance sheets, statements of operations, stockholders’ equity, and cash flows have been made. Unaudited interim results of operations and cash flows are not necessarily indicative of the results that may be expected for the full year. Unaudited interim condensed consolidated financial statements and footnotes should be read in conjunction with the audited consolidated financial statements and footnotes included in Part II, Item 8 of the Annual Report, wherein a more complete discussion of significant accounting policies and certain other information can be found.
Revenue Recognition	Revenue Recognition Products — Used Serviceable Material Sales (“USM”) Revenues from sales of USM are measured based on consideration specified within customer contracts, and excludes any sales commissions and taxes collected and remitted to government agencies. The Company recognizes revenue when performance obligations are satisfied by transferring control of a product or service to a customer. The parts are sold at a fixed price with no right of return. In determining the performance obligation, management has identified the promise in the contract to be the shipment of the spare parts to the customer. Title passes to the buyer when the goods are shipped, the buyer is responsible for any loss in transit and the Company has a legal right to payment for the spare parts once shipped. The Company generally sells its USM products under standard 30-day payment terms, subject to certain exceptions. Customers neither have the right to return products nor do they have the right to extended financing. The Company has determined that physical acceptance of the spare parts to be a formality in accordance with ASC Topic 606, “Revenue from Contracts with Customers” (“ASC 606”). Spare parts revenue is based on a set price for a set number of parts as defined in the purchase order. The performance obligation is completed once the parts have shipped and as a result, all of the transaction price is allocated to that performance obligation. The Company has determined that it is appropriate to recognize spare parts sales at a point in time (i.e., the date the parts are shipped) in accordance with ASC 606. Products — Whole Asset Sales Revenues from whole asset sales are measured based on consideration specified in the contract with the customer. The Company and customer enter into an agreement which outlines the place and date of sale, purchase price, condition of the whole asset, bill of sale and the assignment of rights and warranties from the Company to the customer. The Company believes the whole asset holds standalone value to the customer as it is not dependent on any other services for functionality purposes and therefore is distinct within the context of the contract and as described in ASC 606-10. Accordingly, the Company has identified the transfer of the whole asset as the performance obligation. The transaction price is set at a fixed dollar amount per fixed quantity (number of whole assets) and is explicitly stated in each contract. Whole asset sales revenue is based on a set price for a set number of assets, which is allocated to the performance obligation discussed above, in its entirety. The Company has determined the date of transfer to the customer is the date the customer obtains control over the asset and would cause the revenue recognition. Payment is required in full upon a customer’s acceptance of the whole asset on the date of the transfer. Leasing Revenues The Company leases flight equipment under operating leases that contain monthly base rent and reports rental income straight line over the life of the lease as it is earned. Additionally, the Company’s leases provide for supplemental rent, which is calculated based on actual hours or cycles of utilization and, for certain components, based on the amount of time until maintenance of that component is required. In certain leases, the Company records supplemental rent paid by the lessees as maintenance deposit payment liabilities in recognition of the Company’s contractual commitment to reimburse qualifying maintenance. Reimbursements to the lessees upon receipt of evidence of qualifying maintenance work are charged against the existing maintenance deposit payments liabilities. In leases where the Company is responsible for performing certain repairs or replacement of aircraft components or engines, supplemental rent is recorded as revenue in the period earned. In the event of premature lease termination or lessee default on the lease terms, revenue recognition will be discontinued when outstanding balances are beyond the customers’ deposits held. Payment terms for leased flight equipment are due upon receipt. Service Revenues Service revenues are recognized as performance obligations when they are fulfilled and the benefits are transferred to the customer. At contract inception, the Company evaluates if the contract should be accounted for as a single performance obligation or if the contract contains multiple performance obligations. In some cases, the Company’s service contract with the customer is considered one performance obligation as it includes factors such as the good or service being provided is significantly integrated with other promises in the contract, the service provided significantly modifies or customizes the other good or service or the goods or services are highly interdependent or interrelated with each other. If the contract has more than one performance obligation, the Company determines the standalone price of each distinct good or service underlying each performance obligation and allocates the transaction price based on their relative standalone selling prices. The transaction price of a contract, which can include both fixed and variable amounts, is allocated to each performance obligation identified. Some contracts contain variable consideration, which could include incremental fees or penalty provisions related to performance. Variable consideration that can be reasonably estimated based on current assumptions and historical information is included in the transaction price at the inception of the contract but limited to the amount that is probable that a significant reversal in the amount of cumulative revenue recognized will not occur. Variable consideration that cannot be reasonably estimated is recorded when known. For most service contracts, performance obligations are satisfied over time as work progresses based on transfer of control of products and services to our customers. The Company receives payments from our customers based on billing schedules or contract terms. For performance obligations that are satisfied over time, the Company measures progress in a manner that depicts the performance of transferring control to the customer. As such, the Company utilizes the input method of cost-to-cost to recognize revenue over time as this depicts when control of the promised goods or services are transferred to the customer. Revenue is recognized based on the relationship of actual costs incurred to date to the estimated total cost at completion of the performance obligation. The Company is required to make certain judgments and estimates, including estimated revenues and costs, as well as inflation and the overall profitability of the arrangement. Key assumptions involved include future labor costs and efficiencies, overhead costs and ultimate timing of product delivery. Differences may occur between the judgments and estimates made by management and actual program results. Under most of the Company’s Maintenance, Repair and Overhaul (“MRO”) contracts, if the contract is terminated for convenience, the Company is entitled to payment for items delivered, fair compensation for work performed, the costs of settling and paying other claims and a reasonable profit on the costs incurred or committed. Changes in estimates and assumptions related to our arrangements accounted for using the input method based on labor hours are recorded using the cumulative catchup method of accounting. These changes are primarily adjustments to the estimated profitability for our long term programs where the Company provides MRO services. The Company has elected to use certain practical expedients permitted under ASC 606. Shipping and handling fees and costs incurred associated with outbound freight after control over a product has transferred to a customer are accounted for as a fulfillment cost, are included in cost of sales in our condensed consolidated statements of operations and are not considered a performance obligation to our customers. The Company’s reported sales on our condensed consolidated statements of operations are net of any sales or related non income taxes. The Company also utilizes the “as invoiced” practical expedient in certain cases where performance obligations are satisfied over time and the invoiced amount corresponds directly with the value the Company is providing to the customer.
Revision of Prior Period Financial Statements	Revision of Prior Period Financial Statements During the six months ended June 30, 2021, the Company identified and corrected immaterial errors that affected certain of its previously issued consolidated financial statements. These errors related to the misapplication of generally accepted accounting principles in the United States in connection with the classification of the Company’s private warrants as equity. The SEC released a Public Statement on April 12, 2021 noting that when one or more features common to warrants in SPAC transactions is included in a warrant, the warrant “should be classified as a liability measured at fair value, with changes in fair value each period reported in earnings.” Following review of the SEC’s statement, the Company concluded that its private warrants do not meet the conditions to be classified as equity and instead, the private warrants meet the definition of a derivative under Accounting Standards Codification (“ASC”) 815 “Derivatives and Hedging.” This requires the Company to record the private warrants as a liability measured at fair value on the Company’s Condensed Consolidated Balance Sheets with the changes in fair value each period reported in earnings. As a result, the Company recorded $0.4 million and $0.6 million of expense in the three and six month periods ended June 30, 2021, reflected as change in fair value of warrant liability. Accordingly, the Company revised its December 31, 2020 financial statements by recognizing the private warrants as a liability upon the consummation of the Business Combination on December 22, 2020 in the amount of $1.2 million with a corresponding reduction to additional paid-in capital and retained earnings of $0.8 million and $0.4 million, respectively. The Company determined the impact of the error related to the accounting treatment of private warrants had an immaterial impact with respect to the Company’s consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2020. However, in order to correctly present the immaterial errors noted above, previously issued comparative financial statements have been revised as of the quarter ended March 31, 2021.
New Accounting Pronouncements Not Yet Adopted	New Accounting Pronouncements Not Yet Adopted In February 2016, the FASB issued ASU 2016-02 Leases (Topic 842), which generally requires companies to recognize operating and financing lease liabilities and corresponding right-of-use assets on the balance sheet. In July 2018, FASB issued ASU No. 2018-10, “Codification Improvements to Topic 842, Leases” and ASU No. 2018-11, “Leases (Topic 842): Targeted Improvements.” Although early adoption is permitted, the Company plans to adopt Topic 842 during the first quarter of 2022, on a modified retrospective basis. The Company is currently evaluating the impact this guidance will have on our consolidated financial statements and related disclosures. In June 2016, the FASB issued ASU No. 2016-13 (“ASU 2016-13”), “Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” In November 2018, FASB issued ASU No. 2018-19, “Codification Improvements to Topic 326, Financial Instruments — Credit Losses,” which amends the scope and transition requirements of ASU 2016-13. Topic 326 requires a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions and reasonable and supportable forecasts that affect the collectability of the reported amount. Topic 326 will become effective for the Company beginning January 1, 2023, with early adoption permitted, on a modified retrospective basis. The Company is currently evaluating the impact this guidance will have on our consolidated financial statements and related disclosures.
Payroll Support Programs	Payroll Support Programs The Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) was signed into law on March 27, 2020 and is intended to assist the economy by issuing a relief package to preserve jobs in industries adversely impacted by the COVID-19 outbreak. On June 8, 2020, the Company entered into an agreement with the U.S. Department of the Treasury to receive $16.4 million in emergency relief through the CARES Act Payroll Support Program to be paid in installments. The proceeds of the grant are recorded within accrued expenses when received and are recognized as payroll support program proceeds in the condensed consolidated statement of operations over the periods that the funds are intended to compensate. During the six months ended June 30, 2021, we received the remaining balance of $3.7 million in grant proceeds under the CARES Act Payroll Support Program and this amount has been recognized as payroll support program proceeds in the condensed consolidated statement of operations. No amounts were received under the CARES Act Payroll Support Program during the three months ended June 30, 2021. As part of the Payroll Support Program Extension Law, we entered into a new agreement with the U.S. Department of the Treasury on March 4, 2021 for the receipt of relief funds of $5.5 million. During the six months ended June 30, 2021, we received $5.5 million in grant proceeds under the Payroll Support Program Extension Law. During the three- and six-month periods ended June 30, 2021, $2.9 million and $5.5 million was recognized as payroll support program proceeds in the condensed consolidated statements of operations. Pursuant to the American Rescue Plan Act of 2021 (“ARP”), we entered into a new agreement with the U.S. Department of the Treasury on April 16, 2021 for the receipt of relief funds of an additional $5.5 million. This amount was recognized as payroll support program proceeds during the three- and six-month periods ended June 30, 2021 in the condensed consolidated statements of operations. In connection with the financial assistance we have received under the Payroll Support Program, we are required to comply with certain provisions of the CARES Act, including the requirement that funds provided pursuant to the Payroll Support Program be used exclusively for the continuation of payment of employee wages, salaries and benefits and the requirement against involuntary terminations, furloughs and reductions in employee pay rates and benefits from the signing date of the Payroll Support Program agreement through September 30, 2021. In addition, we are subject to provisions prohibiting the repurchase of common stock and the payment of common stock dividends through September 30, 2022, as well as limitations on the payment of certain employee compensation through April 1, 2023. These restrictions may affect our operations and if we do not comply with these provisions, we may be required to reimburse up to 100% of any previously received relief funds.

REVENUE (Tables)

6 Months Ended

Jun. 30, 2021

REVENUE

Schedule of contract assets


	June 30, 2021		December 31, 2020		Change
Contract assets	$	19,975	$	20,431	$	(456)

Schedule of disaggregation of revenue


	Three months ended June 30,						Six months ended June 30,
	2021						2021
	Asset Management						Asset Management
	Solutions		Tech Ops		Total Revenues		Solutions		Tech Ops		Total Revenues
USM	$	11,244	$	1,116	$	12,360	$	20,469	$	2,259	$	22,728
Whole asset sales		42,689		-		42,689		56,460		-		56,460
Engineered solutions		-		1,126		1,126		-		2,113		2,113
Total products		53,933		2,242		56,175		76,929		4,372		81,301
Leasing		6,366		-		6,366		12,622		-		12,622
Services		-		29,380		29,380		-		56,433		56,433
Total revenues	$	60,299	$	31,622	$	91,921	$	89,551	$	60,805	$	150,356


	Three months ended June 30,						Six months ended June 30,
	2020						2020
	Asset Management						Asset Management
	Solutions		Tech Ops		Total Revenues		Solutions		Tech Ops		Total Revenues
USM	$	6,520	$	150	$	6,670	$	21,569	$	1,474	$	23,043
Whole asset sales		3,103		-		3,103		3,103		-		3,103
Engineered solutions		-		-		-		-		1,658		1,658
Total products		9,623		150		9,773		24,672		3,132		27,804
Leasing		11,228		-		11,228		27,010		-		27,010
Services		-		24,355		24,355		-		47,677		47,677
Total revenues	$	20,851	$	24,505	$	45,356	$	51,682	$	50,809	$	102,491

INVENTORY (Tables)

6 Months Ended

Jun. 30, 2021

INVENTORY

Schedule of major classes of inventory


	June 30, 2021		December 31, 2020
Used serviceable materials	$	62,302	$	63,277
Work-in-process		20,518		20,611
Whole assets		89,122		56,767
	$	171,942		140,655
Less short term		(110,436)		(85,192)
Long term	$	61,506	$	55,463

INTANGIBLE ASSETS (Tables)

6 Months Ended

Jun. 30, 2021

INTANGIBLE ASSETS

Schedule of intangible assets with indefinite lives


	June 30, 2021		December 31, 2020
Qwest:
FAA Certifications	$	724	$	724
Goodwill		13,416		13,416
ALGS:
FAA Certifications		710		710
Goodwill		379		379
ACS:
Trademarks		600		600
FAA Certifications		7,300		7,300
Goodwill		63		63
ACT:
Trademarks		200		200
FAA Certificates		796		796
Goodwill		6,002		6,002
Total intangible assets with indefinite lives	$	30,190	$	30,190

Schedule of intangible assets with definite lives


	Useful Life
	In Years	June 30, 2021		December 31, 2020
Qwest:
Customer relationships	10	$	7,600	$	8,083
ALGS:
Customer relationships	10		80		90
ACS:
Customer relationships	10		1,558		1,663
ACT:
Customer relationships	10		7,741		8,198
Total intangible assets with definite lives		$	16,979	$	18,034

PROPERTY AND EQUIPMENT (Tables)

6 Months Ended

Jun. 30, 2021

PROPERTY AND EQUIPMENT, NET

Schedule of Property, Plant and equipment, net


	Useful Life
	In Years	June 30, 2021		December 31, 2020
Tooling and equipment	7 - 15	$	13,303	$	13,465
Furniture and other equipment	5		7,651		7,379
Computer software	5		2,026		2,378
Leasehold improvements	3 - 6		3,470		3,314
Equipment under capital lease	5		192		197
			26,642		26,733
Less accumulated depreciation			(18,965)		(18,894)
		$	7,677	$	7,839

LEASE RENTAL REVENUES AND AIRCRAFT AND ENGINES HELD FOR LEASE (Tables)

6 Months Ended

Jun. 30, 2021

LEASE RENTAL REVENUES AND AIRCRAFT AND ENGINES HELD FOR LEASE

Summary of aircraft and engines held for operating leases, net


	June 30, 2021		December 31, 2020
Aircraft and engines held for operating leases	$	210,593	$	228,942
Less accumulated depreciation		(135,694)		(142,098)
	$	74,899	$	86,844

Summary of minimum future annual lease rentals contracted to be received under existing operating leases of flight equipment


Year ending December 31:
Remainder of 2021	$	9,950
2022		10,947
2023		2,008
Total minimum lease payments	$	22,905

ACCRUED EXPENSES (Tables)

6 Months Ended

Jun. 30, 2021

ACCRUED EXPENSES

Schedule of components of accrued expenses


	June 30, 2021		December 31, 2020
Accrued compensation and related benefits	$	4,642	$	6,624
Accrued legal fees		53		18
Commission fee accrual		74		103
Accrued federal, state and local taxes and fees		184		130
Other		1,315		1,701
	$	6,268	$	8,576

EARNINGS PER SHARE (Tables)

6 Months Ended

Jun. 30, 2021

EARNINGS PER SHARE

Summary of reconciliation of the computation for basic earnings per share


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Net income (loss)	$	16,548	$	(7,938)	$	26,566	$	(6,879)
Reversal of loss on change in value of warrant liability		407		-		631		-
Net income attributable to common shareholders for EPS - diluted	$	16,955	$	(7,938)	$	27,197	$	(6,879)

Weighted-average number of shares outstanding - basic		42,949,261		37,010		42,584,793		37,010
Additional shares from assumed stock-settled restricted stock units		237,243		-		186,420		-
Additional shares from assumed exercise of warrants		1,063,357		-		1,469,201		-
Weighted-average number of shares outstanding - diluted		44,249,861		37,010		44,240,414		37,010

Earnings per share – basic:	$	0.39	$	(214.48)	$	0.62	$	(185.87)
Earnings per share – diluted:	$	0.38	$	(214.48)	$	0.61	$	(185.87)

BUSINESS SEGMENTS (Tables)

6 Months Ended

Jun. 30, 2021

BUSINESS SEGMENTS

Summary of selected financial information for each segment


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Revenues
Asset Management Solutions
Aircraft	$	24,269	$	10,602	$	34,721	$	24,840
Engine		36,030		10,249		54,830		26,842
		60,299		20,851		89,551		51,682
Tech Ops
MRO services		29,380		24,355		56,433		47,677
Product sales		2,242		150		4,372		3,132
		31,622		24,505		60,805		50,809
Total	$	91,921	$	45,356	$	150,356	$	102,491


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Gross profit (loss)
Asset Management Solutions
Aircraft	$	5,178	$	(9,924)	$	9,641	$	(6,262)
Engine		13,921		1,017		23,045		9,122
		19,099		(8,907)		32,686		2,860
Tech Ops
MRO services		11,048		6,793		16,074		9,137
Product sales		591		(14)		1,813		1,161
		11,639		6,779		17,887		10,298
Total	$	30,738	$	(2,128)	$	50,573	$	13,158

Summary of reconciles segment gross profit to net income


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Segment gross profit (loss)	$	30,738	$	(2,128)	$	50,573	$	13,158
Selling, general and administrative expenses		(16,966)		(14,036)		(30,276)		(27,237)
Payroll support program proceeds		8,405		6,346		14,768		6,346
Transaction costs		-		16		-		(215)
Interest expense, net		(251)		(504)		(509)		(1,040)
Other income, net		155		95		249		152
Change in fair value of warrant liability		(407)		-		(631)		-
Income tax (expense) benefit		(5,126)		2,273		(7,608)		1,957
Net income (loss)	$	16,548	$	(7,938)	$	26,566	$	(6,879)

Summary of intersegment revenues


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Asset Management Solutions	$	536	$	832	$	1,983	$	1,102
Tech Ops		1,328		542		3,486		1,461
Total intersegment revenues	$	1,864	$	1,374	$	5,469	$	2,563

COMMITMENTS AND CONTINGENCIES (Tables)

6 Months Ended

Jun. 30, 2021

COMMITMENTS AND CONTINGENCIES

Summary of future minimum lease payments under non-cancelable operating leases


Year ending December 31:
Remainder of 2021	$	2,397
2022		3,591
2023		2,755
2024		2,308
2025		1,811
2026		1,846
Thereafter		2,601
Total minimum lease payments	$	17,309

BUSINESS COMBINATION (Tables)

6 Months Ended

Jun. 30, 2021

BUSINESS COMBINATION

Summary of purchase price allocation


	Acquisition
	Date
	Fair Values
Accounts receivable	$	1,442
Deposits, prepaid expenses, and other current assets		22
Property and equipment		381
Other intangible assets		10,096
Goodwill		6,002
Accounts payable		(134)
Accrued expenses		(833)
Total purchase price	$	16,976

Summary of intangible assets acquired


	Fair Value
Trademark and trade name (indefinite lived)	$	200


	Fair Value
FAA part 145 certificate (indefinite lived)	$	796


	Useful Life In
	Years	Fair Value
Customer relationships	10	$	9,100

STOCKHOLDERS' EQUITY (Tables)

6 Months Ended

Jun. 30, 2021

STOCKHOLDERS' EQUITY

Share-based Payment Arrangement, Restricted Stock Unit, Activity [Table Text Block]


					Weighted Average
			Weighted Average		Remaining Contractual
	Amount		Grant Date Fair Value		Life (Years)
Outstanding at December 31, 2020		—	$	—	$	—
Granted		1,702,280		10.10		2.49
Outstanding June 30, 2021		1,702,280	$	10.10	$	2.49

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue Recognition (Details)	6 Months Ended
	Jun. 30, 2021
USM \| Fixed price contract
Revenue recognition
Payment terms	30-day
Whole asset sales \| Fixed price contract
Revenue recognition
Payment terms	Payment is required in full
Leasing
Revenue recognition
Payment terms	due upon receipt

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revision of prior period financial statements (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2021	Dec. 31, 2020	Dec. 22, 2020
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Change in fair value of warrant liability	$ 407	$ 631
Additional paid in capital	293,019	293,019	$ 292,593	$ 1,200
Corresponding reduction in additional paid in capital				800
Retained earnings	$ 85,424	$ 85,424	$ 58,858	$ 400

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Apr. 16, 2021	Mar. 04, 2021	Jun. 08, 2020
Accounting policies:
Payroll support program proceeds	$ (8,405,000)	$ (6,346,000)	$ (14,768,000)	$ (6,346,000)
Payroll Support Program Extension, CARES Act
Accounting policies:
Debt instrument, face						$ 5,500,000	$ 16,400,000
Payroll support program proceeds	2,900,000		5,500,000
Grant proceeds			5,500,000
Payroll Support Program, CARES Act
Accounting policies:
Payroll support program proceeds	$ 0		$ 3,700,000
American Rescue Plan Act of 2021
Accounting policies:
Debt instrument, face					$ 5,500,000

SIGNIFICANT RISKS AND UNCERTAINTIES (Details) - USD ($) $ in Millions	1 Months Ended	12 Months Ended
	Mar. 31, 2020	Dec. 31, 2020
SIGNIFICANT RISKS AND UNCERTAINTIES
Feedstock opportunities cancelled	$ 20.0
Headcount reductions and suspension of various other initiatives		$ (20.0)

REVENUE (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
REVENUE (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Jun. 30, 2021	Dec. 31, 2020
REVENUE
Contract assets	$ 19,975	$ 19,975	$ 20,431
Contract assets, increase (decrease)		(456)
Deferred revenue	2,289	2,289	2,595
Contract liabilities			$ 2,200
Revenue recognized of the entire opening balance of our contract liabilities	$ 400	$ 1,400

REVENUE - Disaggregation (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
REVENUE - Disaggregation (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Revenue disaggregation:
Revenue	$ 91,921	$ 45,356	$ 150,356	$ 102,491
Products
Revenue disaggregation:
Revenue	56,175	9,773	81,301	27,804
USM
Revenue disaggregation:
Revenue	12,360	6,670	22,728	23,043
Whole asset sales
Revenue disaggregation:
Revenue	42,689	3,103	56,460	3,103
Engineered solutions
Revenue disaggregation:
Revenue	1,126		2,113	1,658
Leasing
Revenue disaggregation:
Revenue	6,366	11,228	12,622	27,010
Services
Revenue disaggregation:
Revenue	29,380	24,355	56,433	47,677
Asset Management Solutions
Revenue disaggregation:
Revenue	60,299	20,851	89,551	51,682
Asset Management Solutions \| Products
Revenue disaggregation:
Revenue	53,933	9,623	76,929	24,672
Asset Management Solutions \| USM
Revenue disaggregation:
Revenue	11,244	6,520	20,469	21,569
Asset Management Solutions \| Whole asset sales
Revenue disaggregation:
Revenue	42,689	3,103	56,460	3,103
Asset Management Solutions \| Leasing
Revenue disaggregation:
Revenue	6,366	11,228	12,622	27,010
Tech Ops
Revenue disaggregation:
Revenue	31,622	24,505	60,805	50,809
Tech Ops \| Products
Revenue disaggregation:
Revenue	2,242	150	4,372	3,132
Tech Ops \| USM
Revenue disaggregation:
Revenue	1,116	150	2,259	1,474
Tech Ops \| Engineered solutions
Revenue disaggregation:
Revenue	1,126		2,113	1,658
Tech Ops \| Services
Revenue disaggregation:
Revenue	$ 29,380	$ 24,355	$ 56,433	$ 47,677

INVENTORY (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
INVENTORY (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020
Inventory:
Used serviceable materials	$ 62,302		$ 62,302		$ 63,277
Work-in-process	20,518		20,518		20,611
Whole assets	89,122		89,122		56,767
Inventory	171,942		171,942		140,655
Less short term	(110,436)		(110,436)		(85,192)
Long term	61,506		61,506		$ 55,463
Inventory Adjustments
Inventory reserve	4,800	$ 12,900	4,800	$ 12,900
Inventory Scrap loss reserve			5,016	13,349
Scrap
Inventory Adjustments
Inventory Scrap loss reserve	$ 200	$ 100	$ 200	$ 500

INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
Schedule Of Intangible Assets And Goodwill [Line Items]
Goodwill	$ 19,860	$ 19,860
Total intangible assets with indefinite lives	30,190	30,190
Qwest \| Asset Management Solutions \| Certifications
Schedule Of Intangible Assets And Goodwill [Line Items]
Total intangible assets with indefinite lives	724	724
Goodwill	13,416	13,416
ALGS \| Tech Ops
Schedule Of Intangible Assets And Goodwill [Line Items]
Goodwill	379	379
ALGS \| Tech Ops \| Certifications
Schedule Of Intangible Assets And Goodwill [Line Items]
Total intangible assets with indefinite lives	710	710
ACS \| Tech Ops
Schedule Of Intangible Assets And Goodwill [Line Items]
Goodwill	63	63
ACS \| Tech Ops \| Certifications
Schedule Of Intangible Assets And Goodwill [Line Items]
Total intangible assets with indefinite lives	7,300	7,300
ACS \| Tech Ops \| Trademarks
Schedule Of Intangible Assets And Goodwill [Line Items]
Total intangible assets with indefinite lives	600	600
ACT \| Tech Ops
Schedule Of Intangible Assets And Goodwill [Line Items]
Goodwill	6,002	6,002
ACT \| Tech Ops \| FAA Certificates
Schedule Of Intangible Assets And Goodwill [Line Items]
Total intangible assets with indefinite lives	796	796
ACT \| Tech Ops \| Trademarks
Schedule Of Intangible Assets And Goodwill [Line Items]
Total intangible assets with indefinite lives	$ 200	$ 200

INTANGIBLE ASSETS - Estimated useful lives (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2021	Dec. 31, 2020
Finite-Lived Intangible Assets [Line Items]
Total intangible assets with definite lives	$ 16,979	$ 18,034
Asset Management Solutions \| Qwest \| Customer relationships
Finite-Lived Intangible Assets [Line Items]
Useful Life In Years	10 years
Total intangible assets with definite lives	$ 7,600	8,083
Tech Ops \| ALGS \| Customer relationships
Finite-Lived Intangible Assets [Line Items]
Useful Life In Years	10 years
Total intangible assets with definite lives	$ 80	90
Tech Ops \| ACS \| Customer relationships
Finite-Lived Intangible Assets [Line Items]
Useful Life In Years	10 years
Total intangible assets with definite lives	$ 1,558	1,663
Tech Ops \| ACT \| Customer relationships
Finite-Lived Intangible Assets [Line Items]
Useful Life In Years	10 years
Total intangible assets with definite lives	$ 7,741	$ 8,198

INTANGIBLE ASSETS - Additional Information (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020
Finite-Lived Intangible Assets [Line Items]
Impairment on indefinite lived intangible assets				$ 0
Total amortization expense	$ 500,000	$ 700,000	$ 1,100,000	1,000,000.0
Accumulated amortization	$ 4,000,000.0		$ 4,000,000.0		$ 3,000,000.0
Impairment on finite lived intangible assets				0
ACT
Finite-Lived Intangible Assets [Line Items]
Goodwill acquired				$ 6,000,000.0

PROPERTY AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 26,642		$ 26,642		$ 26,733
Less accumulated depreciation	(18,965)		(18,965)		(18,894)
Property and equipment, net	7,677		7,677		7,839
Depreciation expense	500	$ 500	1,000	$ 1,100
Tooling and equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	13,303		$ 13,303		13,465
Furniture and other equipment
Property, Plant and Equipment [Line Items]
Useful life			5
Property and equipment, gross	7,651		$ 7,651		7,379
Computer software
Property, Plant and Equipment [Line Items]
Useful life			5
Property and equipment, gross	2,026		$ 2,026		2,378
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	3,470		$ 3,470		3,314
Equipment under capital lease
Property, Plant and Equipment [Line Items]
Useful life			5
Property and equipment, gross	$ 192		$ 192		$ 197
Minimum \| Tooling and equipment
Property, Plant and Equipment [Line Items]
Useful life			7
Minimum \| Leasehold improvements
Property, Plant and Equipment [Line Items]
Useful life			3
Maximum \| Tooling and equipment
Property, Plant and Equipment [Line Items]
Useful life			15
Maximum \| Leasehold improvements
Property, Plant and Equipment [Line Items]
Useful life			6

LEASE RENTAL REVENUES AND AIRCRAFT AND ENGINES HELD FOR LEASE - Components of Aircraft and engines held for operating leases, net (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020	Dec. 31, 2020
LEASE RENTAL REVENUES AND AIRCRAFT AND ENGINES HELD FOR LEASE
Aircraft and engines held for operating leases	$ 210,593		$ 210,593		$ 228,942
Less accumulated depreciation	(135,694)		(135,694)		(142,098)
Aircraft and engines held for operating lease	74,899		74,899		$ 86,844
Depreciation	2,200	$ 5,400	4,600	$ 12,500
Supplemental rents recognized as revenue	$ 1,800	$ 2,100	$ 2,900	$ 7,600
Term of lease	3 years		3 years

LEASE RENTAL REVENUES AND AIRCRAFT AND ENGINES HELD FOR LEASE - Minimum future annual lease rentals contracted to be received under existing operating leases of flight equipment (Details) $ in Thousands	Jun. 30, 2021 USD ($)
LEASE RENTAL REVENUES AND AIRCRAFT AND ENGINES HELD FOR LEASE
Remainder of 2021	$ 9,950
2022	10,947
2023	2,008
Total minimum lease payments	$ 22,905

ACCRUED EXPENSES (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020
ACCRUED EXPENSES
Accrued compensation and related benefits	$ 4,642	$ 6,624
Accrued legal fees	53	18
Commission fee accrual	74	103
Accrued federal, state and local taxes and fees	184	130
Other	1,315	1,701
Total accrued expenses	$ 6,268	$ 8,576

WARRANT LIABILITY (Details) - $ / shares	6 Months Ended
WARRANT LIABILITY (Details) - $ / shares	Jun. 30, 2021	Jan. 31, 2021
WARRANT LIABILITY
Number of shares per warrant		1
Warrants exercise price		$ 11.50
Warrants outstanding	17,952,589
Number of warrants issued to founders	750,000
Lock-up period	P12M

EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2021	Mar. 31, 2021	Jun. 30, 2020	Mar. 31, 2020	Jun. 30, 2021	Jun. 30, 2020
EARNINGS PER SHARE
Net income (loss)	$ 16,548	$ 10,018	$ (7,938)	$ 1,059	$ 26,566	$ (6,879)
Reversal of loss on change in value of warrant liability	407				631
Net income attributable to common shareholders for EPS - diluted	$ 16,955		$ (7,938)		$ 27,197	$ (6,879)
Weighted-average number of shares outstanding - basic	42,949,261		37,010		42,584,793	37,010
Additional shares from assumed stock-settled restricted stock units	237,243				186,420
Additional shares from assumed exercise of warrants	1,063,357				1,469,201
Weighted-average number of shares outstanding - diluted	44,249,861		37,010		44,240,414	37,010
Earnings per share - basic	$ 0.39		$ (214.48)		$ 0.62	$ (185.87)
Earnings per share - diluted	$ 0.38		$ (214.48)		$ 0.61	$ (185.87)

BUSINESS SEGMENTS (Details)	6 Months Ended
BUSINESS SEGMENTS (Details)	Jun. 30, 2021 segment
BUSINESS SEGMENTS
Number of business segments	2

BUSINESS SEGMENTS - Selected financial information for each segment (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Segment Reporting Information [Line Items]
Revenue from Contract with Customer, Excluding Assessed Tax	$ 91,921	$ 45,356	$ 150,356	$ 102,491
Revenues	91,921	45,356	150,356	102,491
Gross profit (loss)	30,738	(2,128)	50,573	13,158
Services
Segment Reporting Information [Line Items]
Revenue from Contract with Customer, Excluding Assessed Tax	29,380	24,355	56,433	47,677
Products
Segment Reporting Information [Line Items]
Revenue from Contract with Customer, Excluding Assessed Tax	56,175	9,773	81,301	27,804
Asset Management Solutions
Segment Reporting Information [Line Items]
Revenue from Contract with Customer, Excluding Assessed Tax	60,299	20,851	89,551	51,682
Gross profit (loss)	19,099	(8,907)	32,686	2,860
Asset Management Solutions \| Aircraft
Segment Reporting Information [Line Items]
Revenues	24,269	10,602	34,721	24,840
Gross profit (loss)	5,178	(9,924)	9,641	(6,262)
Asset Management Solutions \| Engine
Segment Reporting Information [Line Items]
Revenues	36,030	10,249	54,830	26,842
Gross profit (loss)	13,921	1,017	23,045	9,122
Asset Management Solutions \| Products
Segment Reporting Information [Line Items]
Revenue from Contract with Customer, Excluding Assessed Tax	53,933	9,623	76,929	24,672
Tech Ops
Segment Reporting Information [Line Items]
Revenue from Contract with Customer, Excluding Assessed Tax	31,622	24,505	60,805	50,809
Revenues	31,622	24,505	60,805	50,809
Gross profit (loss)	11,639	6,779	17,887	10,298
Tech Ops \| MRO services
Segment Reporting Information [Line Items]
Revenues	29,380	24,355	56,433	47,677
Tech Ops \| Services
Segment Reporting Information [Line Items]
Revenue from Contract with Customer, Excluding Assessed Tax	29,380	24,355	56,433	47,677
Gross profit (loss)	11,048	6,793	16,074	9,137
Tech Ops \| Products
Segment Reporting Information [Line Items]
Revenue from Contract with Customer, Excluding Assessed Tax	2,242	150	4,372	3,132
Revenues	2,242	150	4,372	3,132
Gross profit (loss)	$ 591	$ (14)	$ 1,813	$ 1,161

BUSINESS SEGMENTS - Reconciles segment gross profit to net income (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
BUSINESS SEGMENTS
Segment gross profit (loss)	$ 30,738	$ (2,128)	$ 50,573	$ 13,158
Selling, general and administrative expenses	(16,966)	(14,036)	(30,276)	(27,237)
Payroll support program proceeds	(8,405)	(6,346)	(14,768)	(6,346)
Transaction costs		16		(215)
Interest expense, net	(251)	(504)	(509)	(1,040)
Other income, net	155	95	249	152
Change in fair value of warrant liability	(407)		(631)
Income tax (expense) benefit	(5,126)	2,273	(7,608)	1,957
Net income (loss)	$ 16,548	$ (7,938)	$ 26,566	$ (6,879)

BUSINESS SEGMENTS - Intersegment revenues (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
Segment Reporting Information [Line Items]
Revenue	$ 91,921	$ 45,356	$ 150,356	$ 102,491
Intersegment
Segment Reporting Information [Line Items]
Revenue	1,864	1,374	5,469	2,563
Asset Management Solutions
Segment Reporting Information [Line Items]
Revenue	60,299	20,851	89,551	51,682
Asset Management Solutions \| Intersegment
Segment Reporting Information [Line Items]
Revenue	536	832	1,983	1,102
Tech Ops
Segment Reporting Information [Line Items]
Revenue	31,622	24,505	60,805	50,809
Tech Ops \| Intersegment
Segment Reporting Information [Line Items]
Revenue	$ 1,328	$ 542	$ 3,486	$ 1,461

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (a)
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
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-Paragraph 41
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9038-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 4
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130543-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130545-203045

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 924
-SubTopic 10
-Section S99
-Paragraph 1
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-URI http://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

+ Details

COMMITMENTS AND CONTINGENCIES - Future minimum lease payments under non-cancelable operating leases (Details) $ in Thousands	Jun. 30, 2021 USD ($)
Future minimum lease payments under non-cancelable operating leases
Remainder of 2021	$ 2,397
2022	3,591
2023	2,755
2024	2,308
2025	1,811
2026	1,846
Thereafter	2,601
Total minimum lease payments	$ 17,309

COMMITMENTS AND CONTINGENCIES - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2021	Jun. 30, 2020	Jun. 30, 2021	Jun. 30, 2020
COMMITMENTS AND CONTINGENCIES
Expenses incurred under the operating lease agreements	$ 1.6	$ 1.6	$ 3.2	$ 3.1

BUSINESS COMBINATION - Purchase price allocation (Details) - USD ($) $ in Thousands	Jun. 30, 2021	Dec. 31, 2020	Jan. 07, 2020
Acquisition Date Fair Values
Goodwill	$ 19,860	$ 19,860
Aircraft Component Technologies, Inc. (ACT)
Acquisition Date Fair Values
Accounts receivable			$ 1,442
Deposits, prepaid expenses, and other current assets			22
Property and equipment			381
Other intangible assets			10,096
Goodwill			6,002
Accounts payable			(134)
Accrued expenses			(833)
Total purchase price			$ 16,976

BUSINESS COMBINATION - Intangible assets (Details) - Aircraft Component Technologies, Inc. (ACT) $ in Thousands	Jan. 07, 2020 USD ($)
Customer relationships
Acquired Indefinite-lived Intangible Assets [Line Items]
Fair value of definite intangible assets acquired	$ 9,100
Useful Life In Years	10 years
Trademarks
Acquired Indefinite-lived Intangible Assets [Line Items]
Fair value of indefinite intangible assets acquired	$ 200
FAA part 145 certificate
Acquired Indefinite-lived Intangible Assets [Line Items]
Fair value of indefinite intangible assets acquired	$ 796

BUSINESS COMBINATION - Additional Information (Details) - USD ($) $ in Thousands		3 Months Ended	6 Months Ended	18 Months Ended
	Jan. 07, 2020	Jun. 30, 2020	Jun. 30, 2020	Jun. 30, 2021
Business combination
Cash consideration			$ 16,976
Aircraft Component Technologies, Inc. (ACT)
Business combination
Cash consideration	$ 17,000
Revenues from operations since acquisition		$ 1,800		$ 4,000
Income from operations since acquisition		$ 400		$ 1,100

STOCKHOLDERS' EQUITY - Common Stock (Details) - $ / shares		12 Months Ended
	Dec. 21, 2021	Dec. 31, 2019	Jun. 30, 2021	Dec. 31, 2020	Dec. 22, 2020
Class of Stock [Line Items]
Recapitalization exchange ratio		74.00%
Par value per share			$ 0.0001	$ 0.0001
Shares authorized			200,000,000	200,000,000
Shares issued			42,949,261	41,046,216
Shares outstanding			42,949,261	41,046,216
AerSale Aviation
Class of Stock [Line Items]
Common Stock, Voting Rights	one
Merger consideration per share					$ 10.00
Shares issued			42,949,261
Shares outstanding			42,949,261

STOCKHOLDERS' EQUITY - Earn-Out Shares and Unvested Founder Shares (Details) - shares	Dec. 22, 2020	Feb. 08, 2020	Jun. 30, 2021
Class of Stock [Line Items]
Number of earn-out shares issuable		1,855,634
Pre-closing holders of AerSale Aviation's common stock and the holders of In-the-Money SARs \| Maximum \| AerSale Aviation
Class of Stock [Line Items]
Number of earn-out shares issuable	3,000,000
Pre-closing holders of AerSale Aviation's common stock
Class of Stock [Line Items]
Unvested Founder Shares, Number of Shares Deferred for Vesting			700,000
Monocle's founder shareholders
Class of Stock [Line Items]
Number of earn-out shares issuable	746,876

STOCKHOLDERS' EQUITY - 2020 Equity Incentive Plan (Details)	6 Months Ended
	Jun. 30, 2021 shares
2020 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock issuable	4,200,000
Performance-based Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting provisions	1,595,000
Remaining vested provisions	107,280
Performance-based Awards \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Remaining vested term	1 year
Performance-based Awards \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Remaining vested term	3 years
2020 Employee Stock Purchase Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock issuable	500,000

STOCKHOLDERS' EQUITY - Restricted Stock Unit Activity (Details) - 2020 Employee Stock Purchase Plan	6 Months Ended
	Jun. 30, 2021 $ / shares shares
Stock Option (in Shares)
Outstanding at December 31, 2020 \| shares	0
Granted \| shares	1,702,280
Outstanding June 30, 2021 \| shares	1,702,280
Weighted Average Grant Date Fair Value
Weighted Average Exercise Price Beginning Balance \| $ / shares	$ 0
Weighted Average Exercise Price Granted \| $ / shares	10.10
Weighted Average Exercise Price Ending Balance \| $ / shares	$ 10.10
Weighted Average Contractual Life
Weighted Average Contractual Life Granted	2 years 5 months 26 days
Weighted Average Contractual Life	2 years 5 months 26 days