Atlas Air announces 3rd Qtr profit
This was in spite of a 59% increase in fuel expenses. We added 2 more -400's this year , an ex Asiana / Air Atlanta 400F and a ex ANA -BCF
Quote:
Atlas Air Worldwide Holdings, Inc. 3Q08 Pretax Income Totals $10.1 Million; Net Income $5.2 Million, $0.24 per Share
Solid Performance in ACMI Segment Tempered by Difficult Market Conditions in Scheduled Service
Last update: 9:33 a.m. EST Nov. 6, 2008
PURCHASE, N.Y., Nov 06, 2008 (BUSINESS WIRE)
Results for the quarter reflected solid performance in the Company's ACMI operations (including express network ACMI), tempered by continued difficult market conditions in Scheduled Service, where high fuel prices and soft demand had a negative impact. Results also reflected lower AMC flying consistent with expectations.
For the quarter ended September 30, 2008, AAWW earned $10.1 million prior to income taxes, on revenues of $460.7 million. Net income totaled $5.2 million, or $0.24 per diluted share.
"Our third-quarter results demonstrate the importance of our strategic focus on de-risking our business model and modernizing our fleet," said William J. Flynn, President and Chief Executive Officer of AAWW.
"The actions that we have taken in transforming our business model to focus on long-term contractual flying, reducing our exposure to fuel prices, and strengthening our financial position will serve us well in these challenging economic times. While we are not immune to the turmoil affecting the world economy, our superior assets, de-risked business model and long-term contracts with the world's leading freight operators position us well to grow our business and earnings."
Flying under a landmark, 20-year blocked-space agreement, AAWW's Polar Air Cargo Worldwide subsidiary commenced full-scale trans-Pacific network service for DHL Express on October 27. The transformational effect of this agreement is expected to result in substantially improved earnings from the six 747-400 freighter aircraft that were previously deployed in the Company's Scheduled Service operation and have now been deployed in express service for DHL. This flying for DHLwill also enhance revenue and earnings visibility as the Company sheds volatility associated with day-to-day fuel-price and revenue risk in the Scheduled Service business. 2009 will be the first full-year of earnings improvement from this agreement, which is cemented by DHL's $150.0 million investment in Polar.
Mr. Flynn also added: "Looking ahead to 2009, we expect pretax earnings from operations to exceed $130.0 million, more than doubling the $55.0 million to $60.0 million of pretax income we now expect to earn in 2008.
"Our outlook for 2008 and 2009 is based on continued, consistent profitability in our core ACMI business, which includes the significant earnings improvement arising from our express network ACMI operations on behalf of DHL. We are maintaining our outlook for lower military charter demand, and our revised 2008 and 2009 full-year expectations account for market weakness in our Commercial Charter segment. In addition, 2008 reflects the impact of an unrealized loss on short-term investments. As we have done in the past, we will also continue to aggressively manage our 747-200 capacity and related overhead to adjust to softening commercial charter demand."
Not included in AAWW's pretax earnings guidance for 2008 is a pretax gain of approximately $153.3 million that will be recognized as income in the fourth quarter of 2008 in connection with the commencement of the long-term blocked-space agreement with DHL.
Mr. Flynn concluded: "Our strategy of de-risking our business model and modernizing our fleet will serve us well in this difficult market environment, and will position us for future earnings and revenue growth. We look forward to our growth into 747-8 freighter service, and we will continue to lead the market in cost-efficient 747-400 freighter aircraft."
