West Atlantic returns to profit in Q1 despite losing mail routes
WEST Atlantic improved its first quarter net income to SEK7
WEST Atlantic improved its first quarter net income to SEK7.5 million (US$855,750) from a loss of SEK14.4 million in 2017 despite Norwegian Mail's early termination of five routes.
The Gothenburg-headquartered freighter operator achieved first quarter revenue growth of one per cent year on year to SEK396.1 million, while earnings before interest, tax, depreciation and amortisation doubled to SEK62.3 million, reported London's Air Cargo News.
'Despite the above, the group revenues for the quarter year on year grew. This is a result of the fully implemented contract with Royal Mail, additional B737 aircraft operating under new contracts for DHL and BAe Aerospace, as well as additional short-term contracts for the ATP.'
Profits were also boosted by the sale of four advanced turbo-prop aircraft (ATPs) to Kenya.
Chief executive Fredrik Groth said: 'As a consequence of Norwegian Mail's decision in 2017 to terminate five routes mid contract we started 2018 with five less ATPs in operation than we ended 2017.
'The significant costs associated with this termination have affected the first quarter and will continue to affect income until the surplus aircraft are sold or placed under new contracts.'
During the quarter the company also took delivery of the world's first Boeing 737-800 converted freighter. It also took delivery of a B737 to fly for DHL and will add one more B767 freighter this year.
Looking ahead, Mr Groth said: 'We remain optimistic about the second half of 2018 and onwards. Focus remains on finding solution for our excess ATP aircraft, fine tuning the B737 operation and growing profitably.
'The successful introduction of the Boeing 737-800 is a very important step for the group, and we expect this fleet to have positive effects on the income for the second half of 2018 and onwards.'