Atlas Air posts 'better-than-expected' Q1 revenue and profits
ATLAS Air Worldwide (WW) continued its solid upward momentum of 2018, reporting surging profits and revenues during the first three months of the year
ATLAS Air Worldwide (WW) continued its solid upward momentum of 2018, reporting surging profits and revenues during the first three months of the year. First-quarter operating revenue surged 15 per cent to US$679.7 million, boosting adjusted profits (measured as EBITDA) by 29.1 per cent to a little over $121 million.
Chief executive Bill Flynn claimed the results 'exceeded expectations' and said the growth was partly due to the carrier's increased fleet.
'We are benefiting from a full year of flying the 16 aircraft we added during 2018 for customers such as Amazon, Asiana Cargo, DHL Express, Inditex and SF Express, as well as the three aircraft for Nippon Cargo Airlines we are adding this year,' he said.
'[And] our focus on express, e-commerce and fast-growing markets provides a solid foundation to deliver continued business and earnings growth this year.'
Q1 volumes surged 16 per cent to 77,061 block hours, reflecting the increased number of aircraft, although that also bought additional costs, reports The Loadstar of UK.
Chief financial officer Spencer Schwartz noted that with the addition of the 737-800s, the carrier had brought onboard a new aircraft type, and as such was having to take on training to ensure its pilots got the hours required to fly the aircraft.
'So we do fly 737s, but the 737-800 is a different gauge and so we are training pilots who will train other pilots and hiring pilots, before the flying starts and so forth, which means the start-up costs are a little different for this aircraft type,' said Mr Schwartz.
'I think as the year progresses you will see the benefit of the aircraft that we added last year and the aircraft that we're adding this year. It's just that they've been masked in this first quarter a little bit, and certainly will be in the second quarter, but for the full year, you'll see that a lot more.'
While ACMI leasing may have climbed 17 per cent over the three-month period, its direct contribution to the quarterly results declined one per cent compared with 2018, which Mr Schwartz put down to additional costs the carrier had taken on for new customers.
'We've taken on a number of customers which are not airlines, and so on their behalf they asked us to go out and procure services and perhaps even fuel,' he continued. 'The good news is we're able to do that because we have scale and the depth in the operation and we can actually create customers which otherwise may not take on aircraft.'
He said the benefits would accrue in a later quarter.