Good morning, and thank you all for joining us for our next Southwest Ideas Conference presentation. I would like to present to you all Air T, which trades on Nasdaq under the symbol AIRT. Representing the company today is their Senior Vice President, Corporate Development, Dan Philp. Dan?
Thank you very much. All right. Sorry if I'm a little hoarse. I'm dealing with a bit of a jet lag. I came in last night. I'm here to talk about Air T. I've been at the company since 2013. I've worked with the CEO, Nick Swenson, for the last just about 20 years in different roles, once at an investment fund as well. What I'm here to talk about is kind of a couple of things. We have an investor deck that is on our website. The slides are similar, but I've reordered them a bit because I wanted to talk about a couple of things specifically, as well as the company more generally. I want to talk a little bit about how we've assembled a platform within Air T for aircraft asset management, as well as some of our digital footprint.
Feel free to ask any questions along the way. We haven't historically given many presentations or really spent much time on investor relations. That's sort of a new topic for us over the last couple of years. I'm also open to a lot of criticism as to what we could do better as far as disclosure goes or how we can give more information to the investing public. Air T is a business that's been around for a long time. It's operated with some of its large partners, FedEx, for instance, for almost 40 years. I'll first go to the blue sky stuff. Safe harbor. There you go. You can read it on our website as well. What do we do? We invest to build aviation companies for the long term. We do that through acquisition. We've also started a few businesses.
Generally, we buy one to two businesses a year over time. That may not seem a lot for somebody who considers themselves a serial acquirer, but we're pretty specific in what we look for. Since we're not a private equity fund or anything that has an end date for our capital, we can afford to be quite patient or aggressive when we need to be. We acquire businesses. We start businesses. Each of our businesses has their own management team. We tend not to try to harvest synergies where you operate in a decentralized way, trying to allow the people that understand their markets the best to make the decisions for their business. We try to operate as more servant leaders where if there are problems or if they need help achieving a certain goal, we can bring resources when needed.
Generally, we like to stay out of the way of the people that understand their markets. We think local decision-making is better than corporate decision-making just because people operate every day in their markets. They need to put their kids through college. They care deeply about delivering good services for their customers. This is the team, the top three. We've worked together since 2007. The bottom three, they've all been working at Air T since 2018. It's a pretty good rendering of all of the people except for our general counsel. He's kind of a jerk, actually. He's not that happy normally. We have a lot of commitment to aligning ourselves with shareholders. We don't have a large amount of stock-based comp. There are some options out there, but generally, they're ways out of the money long-term in nature. Our CEO, Nick Swenson, he's purchased 49% of the company.
Granted, that percentage, I do not think he has ever sold a share, but it might be more than that now. Senior management, we own 20% along with some of the board members as well. These are all open market purchases. None of these shares have really been given for anything. We try to do things where we pay people well and then they can use their cash to continue to participate. The senior management team cares deeply. We feel like we are very much aligned with the other shareholders in the business. Also, we have taken 22% of the stock off the market over time. We have done stock buybacks when we think they make sense. Shareholder communication is something we are trying to get better at. One of the reasons I am here today. We update our shareholder investor deck.
We have a Slido where people can ask any questions they want, and we try to answer all the questions in the next version of the investor deck. We have our shareholder letter, and we have our annual shareholder meeting. Granted, some of those things are required as well. I heard a joke once. I used to be on the investor side of this where if you ever see a flywheel, you should just leave the presentation immediately. We have developed this over time, and it may seem obvious, but it is core to the way we are running the business right now. We think of ourselves as capital allocators at the holding company. We are constantly looking for good ideas to deploy capital. Sometimes that can come through helping grow one of our businesses. Sometimes that can come through acquisition.
We also have a securities portfolio that we trade in and out of as well. We want to match that with the right capital partners. That can be bank capital. That can be internal cash flow. At Air T, as an example, we own three now of the feeder airlines for the FedEx feeder system. Those businesses are quite cash generative. They're asset light. That cash gets swept up to the holding company and then reallocated to other places where we think it could be deployed. Also, that business can't grow with more capital. They grow when FedEx gives us another route or if we acquire another feeder airline or FedEx asks us to acquire another feeder airline. Some of the criticism, if you look at it from a risk profile, is that FedEx contract can be canceled in 30 days. That's true.
It's also been in existence for 40 years. We have a very good relationship with FedEx. We're growing our service level with them over time. When it's matched with capital partners, that can be balance sheet cash, cash coming from our business units that generate it, or it can be outside capital. What I'll talk about in a couple of the subsequent slides is the asset management platform that we've created through acquiring a few different businesses where we're deploying balance sheet cash from investment funds into aircraft that are flying around the world, and then we manage them over time. We want to secure and empower dynamic management teams. We rely heavily on our business unit leaders.
It's very important that they're incented well, that they feel a sense of ownership in their P&L over time, and that we listen to them when they have a strategic vision for where they want to take the business. This is one of our underwriting criteria when we make an acquisition. We want to have a management team in place that has a vision for where they want to take the business. We have to determine if our resources can help them achieve their goals over time. We, of course, want to generate extremely attractive returns. We want to build a brand and an industrious network over time. If we think about that, that does a couple of things. One, it allows us to have more outside capital that we can deploy over time.
It also, through our network, has yielded a significant amount of deal flow to find acquisitions, to find investments, and things of that sort. We want to be good stewards of our capital, our shareholders' capital, and any outside capital that comes into the business. Repeat. This flywheel, I see nobody left, so that's good. All right. Our organizational design, we think that this is a leverage point for us. We're a decentralized portfolio. It's intentional, but it's also because at the holding company, we feel quite humble about our skills. We think that we are good capital allocators, but we are not business unit operators. We need good operators in our system that know what they're doing and have vision. We always talk about our businesses as independent yet interrelated.
We require that businesses that choose to work together, they choose to work together for good reason. For instance, we have a company that is dedicated to buying airframes, which is an aircraft with everything but the engines, and disassembling it and repairing the parts and then selling the part, distributing the parts to maintenance, repair, and overhaul facilities or into the used service market more generally. We also have a business that is focused on the engine side of the equation. These businesses clearly have a synergy. However, we do not try to harvest synergies when we make acquisitions. We try to incent the companies to work together. If the airframe company, for instance, was to work with a completely disinterested third party in the market, sometimes those deals do not close.
The only thing we really ask our business units is if you are going to do a transaction with another business unit, you must close. You must do your work on the front end, and you have to be a credible buyer of the assets. If AirCo wants to do a transaction with Contrail where they both bid on an aircraft and the engines will go to Contrail, [audio distortion] we just ask them to be good stewards with each other. We make space for dynamos and dynamic teams. We came up with a term; we did not come up with it. We recycled the term where our business unit leaders are considered dynamos, and they are in charge of forming their own dynamic teams. We try to give them as much space as we can for them to operate in their markets. We find and develop focus resources.
That's basically our problem-solving ability where if not all of our businesses always perform perfectly all the time. We try to help them solve problems with either capital or project management expertise, legal expertise, financial expertise that we all have at the holding company. We want to form an allocator-operator partnership. That's what we've thought of ourselves for a long time is we are the capital allocators of the world, and our operators are very important, and we partner with them over time. All right, our businesses. In 2013, we got involved with Air T. There were three businesses at the time. One of those businesses has been sold. We buy things quite frequently. We sell things very infrequently. The business that was sold was not for sale. A big strategic came and asked to buy it.
We had a conversation with the business management of that specific unit, and they thought it was a good idea. We proceeded. Since then, we've acquired quite a few businesses. We do that with a combination of cash flow and debt. I'll speak more to the debt in a subsequent slide. Our goal is to grow over time and be very patient for our value creation. This eye-burner chart, it might be hard to see, sort of goes through our capital structure. We think about when we make an acquisition that it is a separate transaction that we're doing that doesn't necessarily put the holding company at risk. We try to keep any debt that we're using at the business unit segregated and ring-fenced. At the holding company, we have $35 million of trust-preferred securities. Those are perpetual instruments.
They have an 8% coupon, our dividend that gets paid. In this particular time period, we're at a sort of a working capital high from our de-icing manufacturer. They operate on kind of an annual cycle where they have a build cycle. Right now, we are long inventory for our de-icing manufacturer. You'll see this $16 million number go down this spring. At our business unit level, one thing I would point to here is Contrail. The first kind of line under it's right here. If you would go out another year or two, I think they peaked at about $75 million in debt during COVID. Part of that was a Main Street loan. They've gone and paid everything off, and now they're in a cash position today. We very much like Contrail. Joe Kuhn and Miriam are wonderful operators.
They're approved at every MRO shop in the world. Their business model is they go and buy V2500 or CF56 jet engines. They do some of the parts analysis. They disassemble them, they repair the parts, and then they sell them into MRO facilities that are doing overhauls on engines. The Air T Acquisition 22.1, that was a transaction we did. That's our naming convention. 22-1 means the first acquisition of fiscal year 2022. That was a combination that's basically an LBO that we did. You can see that's paying off in line over time. It started with $9.5 million of debt. It's paying down to $5.7 million when this was created. That'll pay off over time. That business is actually a really interesting business. It's called World ACD. It's located in the Netherlands. It's the largest co-op database of cargo information in the world.
It's been around for 17 years. What they do is they go out to they cover, I think it's right around 90% of all cargo flown in the world. They have primary source information from over 120 airlines that send them on a weekly basis their most proprietary confidential information. They return to those airlines their market position in an anonymized way. From the revenue side of the business, whether they're looking to go into a new route, a new city pair, they will use World ACD data in order to make commercial decisions on what they'll do in the future. We really like this acquisition. We don't talk a lot about its specific financial performance, but all of their revenue is recurring subscription-based.
We'll say more about that in the future in the subsequent decks, but it's growing, and we really like it a lot. The AAM 24-1, which is here, that $40 million of that. That is growing over time. What that is, is a transaction we've done with a pension fund, and it's all non-recourse. They basically funded us to participate in our aircraft joint venture. Pension fund gives us money. It has an 8.5% return requirement, and we own all of the upside associated with that. It's a way for Air T to finance its way to participate in its aircraft joint ventures. That is also a non-recourse contract debt. $100 million of debt today. Hopefully, I've described a bit of how it's parsed out and the way we think about it. These are our businesses.
I tend to talk too long, so I'll try to go through them relatively quickly. If you look on the SEC filing segment, the first four, those are the feeder airlines, and we have a couple of MRO services in there as well that we've acquired over time. That's the business that flies for FedEx. They basically do everything but own the aircraft. It's quite asset-light. It flies from Minot, North Dakota all the way through Trinidad. They fly Cessna Caravans, ATR 42s, 408s, run by a guy by the name of Mike Bandelin, who's just a wonderful operator. If you look at the ground support equipment, that is Global Ground Support. They are the largest or second largest producer and manufacturer of de-icing equipment in the world. They're sole source to the Air Force located in Olathe, Kansas.
We have a bunch of businesses that are dedicated to commercial aircraft engines and parts. Contrail, they're an engine parts trader. AirCo is an airframe trader where they disassemble frames. Worthington Aviation does both engines and airframes in the regional space. Air'Zona is a storage and maintenance facility in Kingman, Arizona. Jet Yard is a 60-acre plot of land in Marana, Arizona, where they can fly an aircraft in, disassemble it, or store aircraft for a very long period of time. Ambry Hill Technologies, that's a software business that we started. Oh, sorry, I skipped a couple. LGSS, they lease and trade landing gear, so sort of a specific asset within the airframe world. World ACD, I just talked about them. They are the co-op database for cargo information. Ambry Hill Technologies, that's a business that we started.
It's an ERP solution for maintenance, repair, and overhaul facilities as well as parts traders. Crestone Air Partners, that's the manager of the aircraft joint ventures, which I'll get into in a little bit. Delphax Solutions, that's a historical investment that we made in a printer. Runway Aero Advisors, that just started in the last few months. Basically, the individual that helped us raise money for our initial aircraft JV, we've asked them to join, and he has a book of business away as well. Crestone Asset Management. You combine the two, Crestone Air Partners and Crestone Asset Management. That's the non-consolidated kind of fee-bearing entity for our aircraft JVs. Suffice to say, it's quite complicated. Our goal is to own and manage a portfolio of businesses over time that are focused in aviation. Going into our aircraft joint venture a bit.
We came up with a thesis, call it 10 years ago now, where we could acquire businesses that were in the kind of metal management side of the end of life of aircraft. Then we could use the data that they produce and the skill sets that exist at the business units to go and then raise money to go buy aircraft that are on relatively short-term leases that would then allow us to manage the metal as well once they've taken their last flight. That is what we've done. It started with an acquisition of Contrail, which focuses on the most valuable part of an aircraft, which is the engine. Then we acquired AirCo, Worthington, and Jet Yard. Now, and landing gear support services.
Now today, Crestone can go and buy an aircraft that has five to ten years left on its last lease, generally mid to end-of-life aircraft, primarily narrow-body aircraft, some wide bodies, but generally narrow-body aircraft. They can fly their aircraft into Jet Yard in Marana. Our mechanics can disassemble the aircraft, and they can send the engine material to Contrail. Contrail can then repair all the engine material and sell that onto maintenance, repair, and overhaul facilities. All of the airframe material can go to Airco, and they can do the same repair and sell through and distribute the material to similarly maintenance, repair, and overhaul facilities or to airlines directly. All of them can kind of be paid for their market activity.
What this has done is created a consistent flow of material through these businesses, and we hope to grow that over time because all of these businesses are effectively resellers where they have to go and buy something in a market that has its own pricing, and then they have to disassemble it, do some value-add activity, and then sell it into a different market that has its own prices. The hardest part of that is determining your deal flow. Now we have much more, we can have much more scheduled deal flow because we know when an aircraft is coming off a lease. All of these different business units can begin their analysis and generating sales leads and things of that sort. In addition, we've basically taken a lot of the requirement to grow these balance sheets in order for the businesses to grow.
Now we're managing outside capital that owns the aircraft, and we're generating fee income through these businesses. To talk a little bit about Crestone, Crestone is an interesting case. We actually had a group of people that were quite good and adept in the leasing space that we had hired into Contrail. The goal was for them to buy aircraft that had very short-term leases in order to sort of feed the parts company over time. That was all on balance sheet. We decided that it'd probably be better if they had their own business unit, and they had proven through a track record that it was possible. They sort of poured it out and started their own business unit. We went out to market the idea that we would raise a joint venture or a fund.
We had our first meetings in our office. The next day, we went home for COVID for two years. It was quite difficult. We closed our first fund right in the middle of COVID at the time. I had a one-year-old at the time. It was just, "Okay, take the baby. I'm going to go on mute." It was a mess. We were successful. I think part of it was because of the track record that these professionals had established in prior years. If we look at this now, it does not quite go back to when we actually started it. I ran out of real estate, I guess. We started with zero. Since then, we have grown the fund over time, and we are approaching $1 billion. We think that our investors are quite happy.
They've continued to invest in us. We hope to grow this significantly over time. The credibility that all of our business units have generated by understanding their markets, which that data allows us to better underwrite aircraft, has allowed us to partner with some significant asset managers in the world that are interested in access to this space. We believe that this will grow over time and generate very good returns. All right. All right. Going from the world of metal and turning wrenches to the digital space, in this digital space, these are six-month numbers. Think of the revenue as primarily ARR, subscription-based. Within these revenue numbers is one business that we've started that we're continuing to invest in. It's a software business. The other is the much more mature data company that we purchased out of the Netherlands.
You can see that we're growing ARR quite a bit. The business that is super cash generative is helping finance the growth of the business that it continues to be invested in until it gets to scale. Ambry Hill is the other business that we started. It's kind of an interesting story. We bought Worthington Aviation in 2000. It's been almost a decade. The CTO at that business actually was one of the original architects of the incumbent software solution in the space. He did over 100 implementations of the software himself. His last implementation, that company sort of poached him away and hired him, and he ended up working at Worthington Aviation for, I think it was 10 or 12 years before we actually purchased the business.
After we bought the business, he had been working on this solution that would sort of plug all the holes in the incumbent software and sort of be iteratively built on new technology. We said, "We'll fund that going forward. We'll give you a budget, and hopefully, you can grow." In the worst-case scenario, we'll have the best tech. In the best-case scenario, we can make it a product that's saleable. He's doing quite well. The company's name is Ambry Hill Technologies. They have their own website as well. It's worth a look. Consolidated financials. These are year-to-date numbers. The 26 numbers are year-to-date. You can see we're doing a pretty good job of growing top line over time. We try to call out our corporate overhead. We're not scared of that. Our adjusted EBITDA.
I can review these or answer any questions you might have about them. We also have a lot of kind of equity method investments. Lendway is another public company that we own about 30% of. The goal is over time that they will send dividends. CCI is ductile iron foundry that Air T owns, I think, 19% of. It's located in Cadillac, Michigan. We know it quite well. It's a very interesting company. And then [CAM], this is actually the manager of the aircraft JV. That'll continue to send us dividends over time. It's owned 90% by Air T, but it's not consolidated for whatever the changes are in the GAAP rules recently. This is Cadillac. They've been around for a very long time. We know the company really well. We're impressed by the management team there.
They supply some parts to the F-150 historically, but basically, they melt metal and create castings and operate in that space. Lendway, they are a large hydroponic grower of tulips today. Highly roboticized. Their facility is located in Virginia. The global cut flower market is basically broken in my mind. They grow and cut flowers abroad. They have to fly them in an aircraft. It's incredibly inefficient and wasteful. What these guys do is they actually import the bulbs via ocean freight and then grow them in their highly automated facility in Virginia. It's an LBO that Lendway did. Remember, Air T owns 30% of it. It's also public under LDWY. I think it's worth a look over time. That was done about a year- and- a- half ago. In recent news, we made a significant investment into Australia. Regional Express, this is now public.
We expect it to close in December. It's the third largest airline in Australia. Granted, there's one and two, and then there's three. I don't want to be disingenuous by saying it's the third. We think it's really interesting because 50% of their routes, they're either the only service or they're subsidized by the government. They went into administration because during COVID, Virgin Atlantic had gone bankrupt. They decided that they wanted to go and try to compete with Virgin Atlantic and Qantas. They bought a bunch of 737s, and then that didn't work out for them. However, their core business, where they fly Saab 340s, which is an aircraft we're very familiar with, we're actually one of the largest parts suppliers in the world of Saab 340 material, is quite a good one.
If you think of Australia, the only way that you can get from a capital city or a rural area to a capital city is really through using Rex services. The government stepped in during the bankruptcy and bought up all the debt. It was not disassembled because they view it as critical infrastructure. This transaction, we think, will be very interesting. I think it is something to pay attention to. We talk about it as going back to classic Rex. Rex was public. Technically, they are still public, but we are trying to get them back to where they were in 2019. You can look at those financials as well. We just do not have a lot to say about it yet because it has not closed, should close in the next couple of weeks. There you go.
I went over the time you suggested a little bit, but if anybody has any questions, happy to answer any questions you may have.
[audio distortion]
Sure. Do you mean by the depth of the market, or do you mean by our capabilities?
Sure. The nice thing about aviation is the market's enormous and very deep. What has happened over the last few years in particular are the new tech aircraft have had problems. You can look up the problems associated with the GTF and the LEAP engine. Everybody knows about the [Maxes]. That has resulted in more airlines keeping older kit flying longer. We've been able to generate that much sort of AUM or transaction level in a market that's quite tight because a lot of those old aircraft are still flying. We think that there will be a lot of aircraft coming to market over the next decade. Also, historically, the end-of-life space hasn't been very institutionalized. Our goal is to sort of make it a much more understandable asset class by using good data, very open underwriting.
Our background at the holding company comes from kind of credit funds. We want to make sure to establish very high standards for the credit side of the equation as well. We think that the market itself has a lot to do transaction-wise in the mid to end-of-life space. Also, as we get larger and more adept, we think we can also continue to grow and maybe buy younger and younger aircraft. From our internal capabilities, from the leasing team, we've grown the leasing team in Denver, Colorado for Crestone quite significantly. We think that that team could grow. Right now, it's probably at a point where we can harvest some operating leverage. Our capabilities at the parts company levels, it's much more we have plenty of space. It's really, can you store the aircraft?
We have 60 acres in one desert, and then we have a place where you can sort of pay by the tail to store aircraft for a very long period of time. We think we can handle a lot more over time. That's a good question.
Long story. [audio distortion]
Sure. Yeah, it's fair. I don't think there'll be more stock over time outstanding. I'm not selling mine, I guess. I don't think Nick's going to sell his anytime soon. Things when they're cheap tend to trade with very low liquidity. I think things when they're a little bit more adequately priced probably trade with a bit more liquidity. That's fair. I mean, we don't have any control over the people that own their stock hanging on to it or not, but that's a fair question.
Do you use stock in acquisitions?
No. Sorry. I don't want to say strategically no. We haven't. If anything, we would maybe use our trust preferreds or something else. Like any good company executive, I always think our stock's underpriced, so it would be too expensive to use. We haven't yet. We've been able to either find a lot of the transactions are quite heavily structured. They end up with some amount of earnouts or seller financing or bank debt or something of that sort. We will see over time as our acquisitions grow in size, but haven't yet.