updated 5/10/2010 1:31:50 PM ET 2010-05-10T17:31:50

Willis Lease Finance Corp., a lender of jet engines and aircraft to airlines and other aviation clients, said Monday that its first-quarter profit fell on higher expenses, including greater financing costs from an increase in debt.

After paying preferred dividends, Willis Lease reported net income available to common shareholders of $2.3 million, or 24 cents per share, down from $6.2 million, or 71 cents per share, in the year-ago period, when the company had a one-time positive tax adjustment of $1.8 million.

Revenue rose 3 percent to nearly $35.7 million from $34.6 million.

But that gain was offset by a 17.5 percent rise in expenses to nearly $31.2 million from $26.5 million. Total net finance costs jumped 28 percent compared with a year ago, reflecting increased debt levels as well as a higher interest rate on a recently renewed revolving credit facility. Other key expense components, including depreciation expenses and general and administrative expenses, also rose.

The company, based in Novato, Calif., said its lease portfolio increased 13 percent from the year-ago period, to offset lower portfolio utilization.

Shares of Willis Lease rose 69 cents, or 5.8 percent, to $12.50 in afternoon trading. The stock has ranged from $10.50 to $17.61 over the past year.

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