Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Michael Linenberg – Bank of America Merrill Lynch.
Michael Linenberg – Bank of America Merrill Lynch
A couple of questions here, I guess Steve you made a good point about where lease rates seem to have stabilized and maybe there’s an opportunity for them to increase but then you sort of qualified it that some of the leasing companies out there are in a distressed state and that maybe ultimately for lease rates to go up those companies need to be in the hands of more disciplined parents and what I’m getting to is in your campaigns as you look out for potential renewals and I know that you’re placing an airplane later this year, have you come across from what you’re hearing from potential customers that maybe some of these distressed lessors are acting less rational than maybe what you’ve seen in the past? Is there any color or anything that you can provide on that to give us some additional kind of sense where pricing is going?
Steven Zissis
Certainly we are seeing increased activity by some of the weaker lessors and in desperation to lease their aircraft at lease rates of whatever they can obtain in the marketplace. You have to qualify I think that statement that it really does go by aircraft type. Some of the older out of production aircraft are being essentially given away in the marketplace whereas the in production stuff is maintaining its lease rates. But, we see some of the competitors out there being very aggressive in terms of offering their aircraft at what we think are lease rates that don’t make any sense in the current marketplace.
Michael Linenberg – Bank of America Merrill Lynch
Then my second question, this is to Gary, when we look at the numbers and this is going to the back page of the press release where you have the available cash flow, the amortization of debt issuance cost, the $1.8 million, I just want to reconcile that with the income statement. Which line item is that in?
Gary Dales
That would be part of interest expense.
Michael Linenberg – Bank of America Merrill Lynch
So that shows up in the interest expense. The debt purchase option amortization wouldn’t that be non-cash or is that cash?
Gary Dales
It is a non-cash charge but we’re not adding it back.
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