Conference Call/Webcast – 11:00 A.M. Eastern
PURCHASE, N.Y., January 28, 2022 – Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW) will release results for the fourth quarter and full year ended December 31, 2021, prior to the opening of stock market trading on Thursday, February 17.
John W. Dietrich, Atlas Air Worldwide’s President and Chief Executive Officer, and Spencer Schwartz, Executive Vice President and Chief Financial Officer, will host a conference call to discuss the company’s results at 11:00 a.m. Eastern Time on February 17.
Interested parties may listen to the call live at Atlas Air Worldwide’s Investor site or at https://edge.media-server.com/mmc/p/whtitre6.
For those unable to listen to the live call, a replay will be archived on the Investor site following the call. A replay will also be available through February 24 by dialing (855) 859-2056 (U.S. Toll Free) or (404) 537-3406 (from outside the U.S.) and using Access Code 9953709#.
Slides complementing the company’s presentation will be available for downloading from the Investor site prior to the call.
About Atlas Air Worldwide:
Atlas Air Worldwide is a leading global provider of outsourced aircraft and aviation operating services. It is the parent company of Atlas Air, Inc. and Titan Aviation Holdings, Inc., and is the majority shareholder of Polar Air Cargo Worldwide, Inc. Our companies operate the world’s largest fleet of 747 freighter aircraft and provide customers the broadest array of Boeing 747, 777, 767 and 737 aircraft for domestic, regional and international cargo and passenger operations.
Atlas Air Worldwide’s press releases, SEC filings and other information may be accessed through the company’s home page, www.atlasairworldwide.com.
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Purchase, N.Y., September 22, 2021 – Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW) announced its subsidiary Atlas Air, Inc. has entered into a long-term agreement with FedEx to provide two 747-400 freighter aircraft on a full-time aircraft, crew, maintenance and insurance (ACMI) basis. This new agreement is in addition to the company’s existing multi-year peak season contract that provides FedEx with a minimum of five aircraft during the fourth quarter.
Both 747-400 freighters have entered service and are flying on behalf of FedEx to support their growing express and e-commerce network.
“We are pleased to grow our long-term relationship with FedEx. This agreement reflects the continued strong demand for airfreight capacity, particularly in the express and e-commerce markets,” said John W. Dietrich, President and Chief Executive Officer of Atlas Air Worldwide. “Atlas is a leader in supporting express networks, with a focus on operating the most modern, fuel-efficient aircraft to deliver high levels of on-time performance for our customers.”
About Atlas Air Worldwide:
Atlas Air Worldwide is a leading global provider of outsourced aircraft and aviation operating services. It is the parent company of Atlas Air, Inc., Southern Air Holdings, Inc. and Titan Aviation Holdings, Inc., and is the majority shareholder of Polar Air Cargo Worldwide, Inc. Our companies operate the world’s largest fleet of 747 freighter aircraft and provide customers the broadest array of Boeing 747, 777, 767 and 737 aircraft for domestic, regional and international cargo and passenger operations.
Atlas Air Worldwide press releases, SEC filings and other information may be accessed through the company’s home page, www.atlasairworldwide.com.
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PURCHASE, N.Y., December 22, 2020 – Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW), a leading global provider of outsourced aircraft and aviation operating services, today announced the completion of a transoceanic sustainable aviation fuel (SAF) test flight that originated at Spain’s Zaragoza Airport.
Atlas Air Flight 562 was powered by a blend of fuel containing 2.33% SAF sourced from fresh vegetable oil. The Boeing 747-400F left Zaragoza on Monday, December 21 and arrived in Mexico City. This is believed to be the first transoceanic commercial cargo flight in Spain to include a blend of SAF and Jet A-1 fuel. Using life cycle analysis, SAF has been shown to reduce carbon emissions by up to 80%. The flight’s cargo included a shipment of goods from an Atlas customer.
“Innovative sustainable aviation fuel test projects demonstrate our ability to partner with our customers and suppliers to help create a more sustainable future for the air cargo industry and global commerce,” said John W. Dietrich, President and Chief Executive Officer of Atlas Air Worldwide. “Through ongoing meaningful partnerships, we will drive wider acceptance and availability of SAF, which will lower costs and have a positive impact on our industry and the environment.”
The blend of fuel was transported from Madrid to Zaragoza. Atlas Air partnered with Exolum, a subsidiary of CLH Group, and utilized its Avikor platform to implement the trial. Given the adaptable nature of SAF, no additional adjustments to fuel or engine components were necessary. The final blend was certified according to DEF STAND 91/091, with the SAF component certified for sustainability in accordance with International Sustainability & Carbon Certification (ISCC) guidelines.
“One of the main targets of Avikor is to promote universally a more sustainable way to fly, offering both individuals and enterprises the possibility of using sustainable aircraft fuel which reduces fuel emissions during flights and helps to improve our planet responsibly, without sacrificing the convenience of flying,” said Andrés Suarez, Global Strategy & Innovation Lead of Grupo CLH and CEO of Exolum.
In line with industry guidelines and best practices, Atlas is deeply committed to environmental stewardship through the reduction of aircraft emissions and resource consumption. Atlas has promoted sustainability by continuously driving operational efficiency and recognizes that the development of sustainable aviation fuels must be accelerated if the industry is going to meet its long-term environmental goals. Atlas is working with partners across the globe to ensure the safety and environmental benefits of SAF and to further its commercial viability.
About Atlas Air Worldwide
Atlas Air Worldwide is a leading global provider of outsourced aircraft and aviation operating services. It is the parent company of Atlas Air, Inc., Southern Air Holdings, Inc. and Titan Aviation Holdings, Inc., and is the majority shareholder of Polar Air Cargo Worldwide, Inc. Our companies operate the world’s largest fleet of 747 freighter aircraft and provide customers the broadest array of Boeing 747, 777, 767 and 737 aircraft for domestic, regional and international cargo and passenger operations.
Atlas Air Worldwide’s press releases, SEC filings and other information may be accessed through the company’s home page, www.atlasairworldwide.com.
About Exolum and Avikor
Exolum is the subsidiary of the CLH Group focused exclusively on identifying and developing new business opportunities aimed at strengthening the Group’s commitment to innovation, entrepreneurship, decarbonisation and circular economy.
Avikor, is the Exolum platform which provides SAF, a sustainable fuel alternative at the service of aviation, clean and, above all, responsible with the environment: www.avikor.com.
PURCHASE, N.Y., August 1, 2019 – Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW) today announced second-quarter 2019 income from continuing operations, net of taxes, of $86.9 million, or $1.61 per diluted share, compared with a reported loss of $21.1 million, or $0.83 per diluted share, in the second quarter of 2018.
Reported results in the second quarter of 2019 included $59.8 million of tax benefits related to the favorable completion of an Internal Revenue Service examination of the company’s 2015 income tax return and an unrealized gain on outstanding warrants of $42.3 million. Reported results for the second quarter of 2018 included an unrealized loss on outstanding warrants of $50.0 million.
On an adjusted basis, EBITDA totaled $86.4 million in the second quarter this year compared with $125.5 million in the year-ago second quarter. Adjusted income from continuing operations, net of taxes, in the second quarter of 2019 totaled $4.5 million, or $0.17 per diluted share, compared with $49.7 million, or $1.75 per diluted share, in the year-ago quarter.
“Revenue and earnings in the second quarter were below our expectations, as air cargo volumes and yields were affected in the near term by the widely reported impact of tariffs and trade tensions,” said Chief Executive Officer William J. Flynn. “In addition, our results during the period were impacted by labor-related service disruptions.
“With manufacturers and shippers taking a wait-and-see approach regarding tariffs and trade issues during the course of the quarter, we experienced a softening in anticipated commercial cargo block hours and yields in our Charter segment. On the military side of Charter, our cargo hours were in line with our expectations for the quarter and were up from the first quarter of this year as we anticipated they would be, but passenger demand for the military was less than expected.”
Mr. Flynn added: “Although these factors are near-term headwinds for our industry, we are well-positioned and managing through them, and are maintaining our focus on our longer-term strategies and growth drivers.
“Our actions include ongoing continuous improvement initiatives designed to increase productivity, enhance efficiency, and grow the business. Additionally, we remain committed to negotiating a competitive collective bargaining agreement for our pilots. Our recent bargaining sessions have made progress, and we look forward to the upcoming scheduled sessions to continue that progress toward an agreement that all parties want.”
He continued: “Based on current conditions, we now anticipate that our full-year adjusted net income will total approximately 80% of our 2018 adjusted net income.* Despite the present trade tensions and the resulting impacts on global airfreight, we have the right building blocks for the future, including our world-class employees; the modern, efficient, diversified aircraft and services that customers want; our focus on express, e-commerce and fast-growing markets; the scale and scope of our enterprise; and our leadership position in global aviation outsourcing.”
Second-Quarter Results
Revenue in the second-quarter of 2019 was relatively in line with revenue in the second quarter of 2018. Higher volumes during the period reflected an increase in ACMI flying that was partially offset by a decrease in Charter flying.
Higher ACMI segment revenue during the period reflected an increase in 767 and 737 flying, the start-up of 747-400 flying for new customers, and incremental 777 flying, partially offset by a decrease in the average rate per block hour primarily related to the growth in smaller-gauge 767 and 737 CMI flying.
ACMI segment contribution decreased during the quarter as increased levels of flying were more than offset by higher crew costs, including enhanced wages and work rules resulting from our interim agreement with pilots at Southern Air; additional heavy maintenance expense; and increased amortization of deferred maintenance costs. In addition, segment contribution was impacted by start-up costs for customer-growth initiatives as well as labor-related service disruptions.
Lower Charter segment revenue during the period was primarily driven by lower levels of flying and a decrease in average rate per block hour. Block-hour volumes primarily reflected a year-over-year decline in cargo and passenger demand from the military, and lower cargo demand from commercial customers reflecting the impact of tariffs and global trade tensions. The decrease in average rate primarily reflected lower commercial cargo yields (excluding fuel), partially offset by an increase in rates for the military.
Lower Charter segment contribution was driven by the decrease in commercial cargo yields and volumes related to the impact of tariffs and global trade tensions; a decrease in military cargo and passenger flying; and additional heavy maintenance expense. Results were also affected by labor-related service disruptions.
In Dry Leasing, higher segment revenue during the quarter primarily reflected the placement of additional 767-300 converted freighter aircraft throughout 2018, as well as the placement of one 777-200 freighter in July 2018, partially offset by the scheduled return of a 777-200 freighter in March 2019 that is awaiting placement with a customer. Lower segment contribution was primarily due to the scheduled return of that 777-200 freighter in March 2019, partially offset by the placement of additional aircraft.
Higher unallocated income and expenses, net, during the quarter primarily reflected the recognition in the second quarter of 2018 of a refund of aircraft rent paid in previous years; fleet growth initiatives; and increased amortization of a customer incentive asset.
Reported earnings in the second quarter of 2019 also included an income tax benefit due mainly to the favorable completion of an IRS examination of our 2015 income tax return and, to a lesser extent, nontaxable changes in the fair value of outstanding warrants. On an adjusted basis, our results reflected an income tax benefit primarily related to the favorable completion of the IRS examination.
Cash and Short-Term Investments
At June 30, 2019, our cash and cash equivalents, short-term investments and restricted cash totaled $127.9 million, compared with $248.4 million at December 31, 2018.
The change in position resulted from cash used for investing and financing activities, partially offset by cash provided by operating activities.
Net cash used for investing activities during the first half of 2019 primarily related to capital expenditures and payments for flight equipment and modifications, including 767-300 aircraft and related freighter conversion costs, spare engines and GEnx engine performance upgrade kits.
Net cash used for financing activities during the period primarily reflected payments on debt obligations.
Half-Year Results
Reported results for the six months ended June 30, 2019 reflected income from continuing operations, net of taxes, of $57.2 million, or $2.21 per diluted share, which included $59.8 million of tax benefits related to the favorable completion of an IRS examination of our 2015 income tax return. Results for the first half compared with a loss from continuing operations, net of taxes, of $11.5 million, or $0.45 per diluted share, for the six months ended June 30, 2018 that was primarily due to an unrealized loss on financial instruments of $57.8 million.
On an adjusted basis, EBITDA totaled $204.0 million in the first half of 2019 compared with $219.3 million in the first half of 2018. First-half 2019 adjusted income from continuing operations, net of taxes, totaled $31.8 million, or $1.16 per diluted share, compared with $73.5 million, or $2.62 per diluted share, in the first half of 2018.
Updating Our 2019 Outlook*
Reflecting our first-half results and our current market expectations for the balance of the year, we expect to fly approximately 330,000 block hours in 2019, with about 75% of the hours in ACMI and the balance in Charter.
We also anticipate revenue of approximately $2.9 billion, adjusted EBITDA of approximately $520 million, and adjusted net income of approximately 80% of our 2018 adjusted net income of $204.3 million.
Aircraft maintenance expense in 2019 is expected to total about $395 million, with depreciation and amortization totaling about $260 million. Core capital expenditures, which exclude aircraft and engine purchases, are projected to total approximately $135 to $145 million, mainly for parts and components for our fleet.
Due to the favorable completion of our IRS tax examination for 2015, we estimate our full-year 2019 adjusted effective income tax rate will be approximately 16%.
For the third quarter of 2019, we expect to fly approximately 85,000 block hours (about 75% in ACMI), with revenue of more than $700 million and adjusted EBITDA of about $125 million. We also expect that our third-quarter adjusted net income will represent a mid- to upper-teen percentage of our full-year adjusted net income.
We provide guidance on an adjusted basis because we are unable to predict, with reasonable certainty, the effects of outstanding warrants and other items that could be material to our reported results.*
Conference Call
Management will host a conference call to discuss Atlas Air Worldwide’s second-quarter 2019 financial and operating results at 11:00 a.m. Eastern Time on Thursday, August 1, 2019.
Interested parties may listen to the call live over the Internet at www.atlasairworldwide.com (click on “Investors,” click on “Presentations” and on the link to the second-quarter call) or at the following Web address:
https://edge.media-server.com/mmc/p/6doge49v
For those unable to listen to the live call, a replay will be archived on the above websites following the call. A replay will also be available through August 9 by dialing (855) 859-2056 (U.S. Toll Free) or (404) 537-3406 (from outside the U.S.) and using Access Code 6458834#.
About Non-GAAP Financial Measures
To supplement our financial statements presented in accordance with U.S. GAAP, we present certain non-GAAP financial measures to assist in the evaluation of our business performance. These non-GAAP measures include Adjusted EBITDA; Adjusted income from continuing operations, net of taxes; Adjusted Diluted EPS from continuing operations, net of taxes; Adjusted effective tax rate; and Free Cash Flow, which exclude certain noncash income and expenses, and items impacting year-over-year comparisons of our results. These non-GAAP measures may not be comparable to similarly titled measures used by other companies and should not be considered in isolation or as a substitute for Income (loss) from continuing operations, net of taxes; Diluted EPS from continuing operations, net of taxes; Effective tax rate; and Net Cash Provided by Operating Activities, which are the most directly comparable measures of performance prepared in accordance with U.S. GAAP.
Our management uses these non-GAAP financial measures in assessing the performance of the company’s ongoing operations and in planning and forecasting future periods. We believe that these adjusted measures, when considered together with the corresponding U.S. GAAP financial measures and the reconciliations to those measures, provide meaningful supplemental information to assist investors and analysts in understanding our financial results and assessing our prospects for future performance. For example:
*We provide guidance on an adjusted basis and are unable to provide forward-looking guidance on a U.S. GAAP basis or a reconciliation to the most directly comparable U.S. GAAP measures because we are unable to predict with reasonable certainty the ultimate outcome of certain significant items. The principal item is the impact on our results of our outstanding warrants, which are highly dependent on the change in our stock price during the period reported. These items are uncertain, depend on various factors, and could have a material impact on our U.S. GAAP results.
About Atlas Air Worldwide:
Atlas Air Worldwide is a leading global provider of outsourced aircraft and aviation operating services. It is the parent company of Atlas Air, Inc., Southern Air Holdings, Inc. and Titan Aviation Holdings, Inc., and is the majority shareholder of Polar Air Cargo Worldwide, Inc. Our companies operate the world’s largest fleet of 747 freighter aircraft and provide customers the broadest array of Boeing 747, 777, 767, 757 and 737 aircraft for domestic, regional and international cargo and passenger operations.
Atlas Air Worldwide’s press releases, SEC filings and other information may be accessed through the company’s home page, www.atlasairworldwide.com.
Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, the following: our ability to effectively operate the network service contemplated by our agreements with Amazon; our ability to coordinate with Amazon to accept newly converted aircraft; the risk that the anticipated benefits of our agreements with Amazon will not be realized when expected, or at all; the possibility that Amazon may terminate its agreements with the companies; the ability of the companies to operate pursuant to the terms of their financing facilities; the ability of the companies to obtain and maintain normal terms with vendors and service providers; the companies’ ability to maintain contracts that are critical to their operations; the ability of the companies to fund and execute their business plan; the ability of the companies to attract, motivate and/or retain key executives, pilots and associates; the ability of the companies to attract and retain customers; the continued availability of our wide-body aircraft; demand for cargo services in the markets in which the companies operate; changes in U.S. and foreign government trade policies; economic conditions; the effects of any hostilities or act of war (in the Middle East or elsewhere) or any terrorist attack; significant data breach or disruption of our information technology systems; labor costs and relations, work stoppages and service slowdowns; the outcome of pending negotiations with our pilots’ union; financing costs; the cost and availability of war risk insurance; aviation fuel costs; security-related costs; competitive pressures on pricing (especially from lower-cost competitors); volatility in the international currency markets; weather conditions; government legislation and regulation; additional regulatory guidance or changes in interpretations and assumptions with respect to the impact of the U.S. Tax Cuts and Jobs Act of 2017; consumer perceptions of the companies’ products and services; anticipated and future litigation; and other risks and uncertainties set forth from time to time in Atlas Air Worldwide’s reports to the United States Securities and Exchange Commission.
For additional information, we refer you to the risk factors set forth under the heading “Risk Factors” in the most recent Annual Report on Form 10-K and subsequent reports on Form 10-Q filed by Atlas Air Worldwide with the Securities and Exchange Commission. Other factors and assumptions not identified above may also affect the forward-looking statements, and these other factors and assumptions may also cause actual results to differ materially from those discussed.
Except as stated in this release, Atlas Air Worldwide is not providing guidance or estimates regarding its anticipated business and financial performance for 2019 or thereafter.
Atlas Air Worldwide assumes no obligation to update such statements contained in this release to reflect actual results, changes in assumptions or changes in other factors affecting such estimates other than as required by law and expressly disclaims any obligation to revise or update publically any forward-looking statement to reflect future events or circumstances.
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New State-of-the-Art Global Operations Center to Create Additional Jobs
PURCHASE, N.Y., July 25, 2019 – Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW) today announced it will expand its operations in northern Kentucky to accommodate its growing workforce in the area.
Atlas’ plans include a commitment to a long-term lease in a new facility in Erlanger, Kentucky, near the Cincinnati/Northern Kentucky International Airport (CVG) to support its growing global operations. The new center in Erlanger is expected to open in 2021.
“Atlas is a premier leader and employer in the air cargo industry, and I am delighted the company will deepen its commitment to Kentucky and grow its operations within this critical North American logistics hub,” said Kentucky Governor Matt Bevin. “We are honored to support Atlas’ growth on a global scale and appreciate that Atlas recognizes what we know in the Commonwealth: Kentucky is an ideal partner for dynamic, growing companies.”
Atlas currently employs 318 professionals, including 182 Kentuckians, at its facilities in northern Kentucky, which includes its Southern Air subsidiary. Employees from the company’s Florence location will relocate to the new site in Erlanger once it is complete.
Atlas expects to create nearly 600 additional jobs in Kentucky in the next 10 years. Globally, the company employs more than 3,000 aviation professionals.
“Kentucky has established itself as a leading global logistics center, and we are thrilled to expand our operations in this thriving area,” said William J. Flynn, Chief Executive Officer of Atlas Air Worldwide. “Our new operations center in Erlanger will enable us to continue to deliver high-quality services to our customers and support their growing global networks. We look forward to the development of a modern, state-of-the-art facility that will foster a great sense of pride with our existing and future employees.”
Atlas Air Worldwide maintains its headquarters in Purchase, N.Y., and maintains a training center in Miami, Florida, in addition to operations in key logistics centers around the world to support its global network.
About Atlas Air Worldwide:
Atlas Air Worldwide is a leading global provider of outsourced aircraft and aviation operating services. It is the parent company of Atlas Air, Inc., Southern Air Holdings, Inc. and Titan Aviation Holdings, Inc., and is the majority shareholder of Polar Air Cargo Worldwide, Inc. Our companies operate the world’s largest fleet of 747 freighter aircraft and provide customers the broadest array of Boeing 747, 777, 767, 757 and 737 aircraft for domestic, regional and international cargo and passenger operations.
Atlas Air Worldwide’s press releases, SEC filings and other information may be accessed through the company’s home page, www.atlasairworldwide.com.
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Unanimous Appellate Court Decision Upholds Preliminary Injunction
Against International Brotherhood of Teamsters
PURCHASE, N.Y., July 8, 2019 – Atlas Air, Inc. and Polar Air Cargo Worldwide, Inc. (collectively, “Atlas” or the “Company”), subsidiaries of Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW), today said that the U.S. Court of Appeals for the District of Columbia has affirmed a federal district court ruling that ordered the International Brotherhood of Teamsters, the International Brotherhood of Teamsters, Airline Division, and Local Union No. 1224 (collectively, the “IBT”) to stop an intentional and illegal work slowdown by Atlas pilots in violation of the Railway Labor Act (“RLA”). The unanimous ruling from a three-judge panel blocks the union from continuing to engage in improper activities such as excessive sick calls on short notice or refusing to work overtime.
In denying the IBT’s appeal, the Court of Appeals also affirmed the District Court’s decision that the IBT must maintain the status quo under the RLA and must continue to take affirmative action to prevent and to refrain from any form of interference with the Company’s operations.
“We are very satisfied with this unanimous ruling from a three-judge panel, which affirms and sustains the preliminary injunction that was entered into 2017,” said William J. Flynn, Chief Executive Officer of Atlas Air Worldwide.
“It is unfortunate that we were compelled to take this extraordinary step of seeking the underlying injunction, but we needed to do so to protect the best interests of our customers, our employees and our Company. Together with our pilots, we remain focused on continuing to provide our customers the high level of service they have come to expect.
“We value the hard work and dedication of our pilots, and look forward to continuing negotiations for a joint collective bargaining agreement in connection with our merger of Atlas Air and Southern Air. We are committed to negotiating an updated agreement that reflects the current market and the significant role our pilots play in the success of our Company.”
About Atlas Air Worldwide:
Atlas Air Worldwide is a leading global provider of outsourced aircraft and aviation operating services. It is the parent company of Atlas Air, Inc., Southern Air Holdings, Inc. and Titan Aviation Holdings, Inc., and is the majority shareholder of Polar Air Cargo Worldwide, Inc. Our companies operate the world’s largest fleet of 747 freighter aircraft and provide customers the broadest array of Boeing 747, 777, 767, 757 and 737 aircraft for domestic, regional and international cargo and passenger operations.
Atlas Air Worldwide’s press releases, SEC filings and other information may be accessed through the company’s home page, www.atlasairworldwide.com.
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William J. Flynn to Become Chairman of the Board on January 1, 2020
John W. Dietrich to Become President and Chief Executive Officer
PURCHASE, N.Y., July 2, 2019 – Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW) today announced that President and Chief Executive Officer William J. (Bill) Flynn will retire from the company effective January 1, 2020, after a successful 13-year tenure, and become Chairman of the Board on that date.
The board has appointed John W. Dietrich, current Executive Vice President and Chief Operating Officer, as Mr. Flynn’s successor. Mr. Dietrich will become President and Chief Operating Officer effective immediately, and he will retain the role as President when he assumes the role of Chief Executive Officer on January 1, 2020.
Additionally, Robert F. Agnew, current Chairman of the Board, will become the Board’s Lead Independent Director, effective January 1, 2020.
The transitions and appointments are the culmination of a comprehensive succession process led by the board to ensure strong leadership continuity as the company continues to advance its strategic growth agenda. Continuing to serve on the Senior Leadership Team are Michael Steen, Executive Vice President and Chief Commercial Officer, and President and Chief Executive Officer of Titan Aviation Holdings, Inc.; Spencer Schwartz, Executive Vice President and Chief Financial Officer; Adam Kokas, Executive Vice President, General Counsel and Secretary; and Patricia Goodwin-Peters, Senior Vice President, Human Resources.
“One of our key responsibilities as a board is the implementation of a leadership transition plan to ensure the company’s continued success in the future,” said Mr. Agnew. “Given John’s depth of experience and proven track record of performance, we are confident that he is uniquely suited to take on the Chief Executive Officer role and lead Atlas into its next growth phase.
“On behalf of the board, I want to thank Bill for his extraordinary leadership. He has built a company that is more dynamic, more profitable, and better-positioned to deliver continued success. Under his leadership, we have grown our fleet, diversified our service offerings, broadened our customer base, and developed a world-class team of talented, customer-focused employees. Bill is well-prepared to have a significant impact as Chairman of the Board.”
During Mr. Flynn’s tenure, the company has become the leading provider of outsourced aviation services. Key significant achievements include the transformation of Polar Air Cargo with the DHL joint venture; investment in the 747-8F platform; acquisition of Southern Air, which added 777 and 737 operating capabilities to the suite of services; growth in relationships with express and e-commerce customers; expansions with long-term customers; and entry into passenger charter flying. Additionally, the company launched and expanded its dry-leasing subsidiary, Titan, to become one of the leading freighter-centric leasing companies with potential for further growth.
“It has been a great privilege to lead the company through this period of tremendous growth, and strengthen our position as a leader in global aviation outsourcing,” said Mr. Flynn. “I am proud of our dedicated and experienced employees, and the business we have built as a team.
“For over two decades, John has had an unparalleled commitment to this company and our employees. He also has played a key role in driving our success. He has the visionary leadership and solid expertise needed to usher in a new era of growth. I look forward to working with John, my fellow board members, and the Senior Leadership Team as we continue executing our strategic growth agenda to create long-term value for our customers, shareholders and employees.”
Mr. Dietrich has over 30 years of experience in the aviation and air cargo industries, including more than 20 with Atlas Air Worldwide. He has served in his current COO role since 2006, and is responsible for all aspects of the company’s global operations. Mr. Dietrich joined the company in 1999 as Associate General Counsel and was promoted to Senior Vice President, General Counsel and Corporate Secretary in 2004, which included responsibility for human resources and corporate communications. Prior to joining Atlas Air Worldwide, Mr. Dietrich worked for United Airlines for 13 years, serving as a corporate attorney in his last position there.
“I am honored to have been selected to lead this great company, and continue the strong momentum established under Bill’s leadership,” said Mr. Dietrich. “We have an outstanding team of employees and a powerful portfolio of aircraft and service offerings. We are fortunate that Bill will continue to be an asset to our team through his role as Chairman. Together with our Senior Leadership Team and talented base of crew and ground staff employees, I look forward to building future growth opportunities.”
About Atlas Air Worldwide:
Atlas Air Worldwide is a leading global provider of outsourced aircraft and aviation operating services. It is the parent company of Atlas Air, Inc., Southern Air Holdings, Inc. and Titan Aviation Holdings, Inc., and is the majority shareholder of Polar Air Cargo Worldwide, Inc. Our companies operate the world’s largest fleet of 747 freighter aircraft and provide customers the broadest array of Boeing 747, 777, 767, 757 and 737 aircraft for domestic, regional and international cargo and passenger operations.
Atlas Air Worldwide’s press releases, SEC filings and other information may be accessed through the company’s home page, www.atlasairworldwide.com.
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Union Ordered to Promptly Participate in Merger Process for New Joint Collective Bargaining Agreement
Positive Step Toward Company’s Goal of Increasing Pilot Pay as Soon as Possible
PURCHASE, N.Y., June 13, 2019 – Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW) today confirmed that its subsidiary, Southern Air, Inc., has prevailed in an important arbitration against the union that represents Southern Air’s pilots, the Airline Professionals Association, Teamsters Local 1224.
The June 12, 2019, arbitration decision orders the union to promptly proceed with contractually required negotiations for a new joint collective bargaining agreement (JCBA) in connection with the merger of Southern Air and Atlas Air, Inc. While union leaders have extensively said publicly that the company has delayed negotiations, the decision states that:
“We can conclude with some certainty, however, that there has been a delay inspired by the Union’s misapprehension of the contractual requirements and that they must now respond vigorously to the Company’s request to proceed.”
This is a positive step in the company’s goal of completing a new JCBA that increases pay for Southern Air and Atlas Air pilots as soon as possible.
“Had the union leaders honored their contractual commitments when we announced the merger back in 2016, Southern Air and Atlas Air pilots would have already had their new contract – and a pay increase – by now,” said Atlas Air Worldwide President and Chief Executive Officer William J. Flynn. “We hope the union will agree that it is time to end unnecessary delays and make progress for our pilots.
“We value the dedication of our crews, and we look forward to further recognize their significant contributions to the development and growth of our business. We are committed to working with the union for a JCBA that enhances overall pay and benefits for our more than 2,000 Southern Air and Atlas Air pilots.”
For more information about the arbitration decision, the contract negotiations process and future updates, please visit AtlasAir5YPilots.com and follow @AtlasAir5Y on Twitter.
About Atlas Air Worldwide:
Atlas Air Worldwide is a leading global provider of outsourced aircraft and aviation operating services. It is the parent company of Atlas Air, Inc., Southern Air Holdings, Inc. and Titan Aviation Holdings, Inc., and is the majority shareholder of Polar Air Cargo Worldwide, Inc. Our companies operate the world’s largest fleet of 747 freighter aircraft and provide customers the broadest array of Boeing 747, 777, 767, 757 and 737 aircraft for domestic, regional and international cargo and passenger operations.
Atlas Air Worldwide’s press releases, SEC filings and other information may be accessed through the company’s home page, www.atlasairworldwide.com.
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PURCHASE, N.Y., June 4, 2019 – Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW) today announced the start of increased 777-200F CMI service for DHL Express, the addition of a third 747-400F for Asiana Cargo, and the beginning of a long-term, 747-400F charter program for one of the world’s largest technology companies.
DHL Express has awarded operation of the first two of its new Boeing 777-200 Freighters to Atlas’ Southern Air, Inc. unit, with an opportunity for additional aircraft in the future as DHL awards the remaining 12 deliveries in its 777 aircraft order.
The new flying for DHL represents a continued expansion of Atlas’ CMI (crew, maintenance and insurance) service. The two CMI aircraft are the seventh and eighth 777s to be operated by Southern Air for DHL. They will be flown on key global routes and will assist DHL in meeting the increasing demand for its express services. The aircraft are expected to begin scheduled operations in June and July 2019.
“We are very pleased that DHL Express has chosen to expand its partnership with us,” said William J. Flynn, President and Chief Executive Officer, Atlas Air Worldwide. “By growing our CMI operations, we continue to diversify our business mix and to drive more predictable revenue and earnings streams.”
Atlas’ companies provide ACMI (aircraft, crew, maintenance and insurance), CMI, charter and dry-leasing services to support DHL’s transpacific express, North American, intra-Asian and global networks. From six aircraft for DHL in October 2008, Atlas has grown service for its largest customer to 40 aircraft today.
In connection with the expansion of CMI service for DHL, two 747-400 freighters currently operating for DHL Express will begin flying for other Atlas customers.
The company’s Atlas Air, Inc. subsidiary has entered into agreements to add a third 747-400 freighter for Asiana Cargo and to begin a long-term 747-400F charter program for a market-leading technology company.
“We are delighted to continue expanding our strategic partnership with Asiana Cargo and to start a new relationship with a major technology company,” Mr. Flynn added. “Like DHL, these customers take pride in providing reliable, high-quality service, and we are very pleased to be chosen to manage a large and important part of their international networks. We look forward to providing them and their customers with unmatched service and a platform for future expansion.”
Kwang Suk Kim, Executive Vice President, Asiana Airlines Cargo, noted: “We are pleased to continue our close cooperation with Atlas Air and to add a third 747-400 freighter. Our growing partnership with Atlas Air will enable us to expand service for our customers and to pursue additional strategic opportunities.”
About Atlas Air Worldwide:
Atlas Air Worldwide is a leading global provider of outsourced aircraft and aviation operating services. It is the parent company of Atlas Air, Inc., Southern Air Holdings, Inc. and Titan Aviation Holdings, Inc., and is the majority shareholder of Polar Air Cargo Worldwide, Inc. Our companies operate the world’s largest fleet of 747 freighter aircraft and provide customers the broadest array of Boeing 747, 777, 767, 757 and 737 aircraft for domestic, regional and international cargo and passenger operations.
Atlas Air Worldwide’s press releases, SEC filings and other information may be accessed through the company’s home page, www.atlasairworldwide.com.
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PURCHASE, N.Y., May 1, 2019 – Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW) today announced continued volume, revenue and earnings growth, excluding the impact of warrant accounting, for the first quarter of 2019. The company also provided an updated full-year growth outlook that reflects the scheduled start-up in 2019 of new long-term 737-800 CMI business.
On a reported basis, results for the first quarter of 2019 were a net loss of $29.7 million, or $1.15 per diluted share, compared with reported income of $9.6 million, or $0.37 per diluted share, in the first quarter of 2018. Reported results for the latest quarter included an unrealized loss on outstanding warrants of $46.6 million compared with an unrealized loss on outstanding warrants of $7.7 million in the year-ago period.
On an adjusted basis, net income in the first quarter of 2019 increased $3.5 million to $27.3 million, or $0.98 per diluted share, from adjusted income of $23.8 million, or $0.86 per diluted share, in the year-ago quarter. Adjusted EBITDA in the quarter rose $27.3 million to $121.1 million.
“Our first-quarter results exceeded our expectations,” said Atlas Air Worldwide President and Chief Executive Officer William J. Flynn. “We are benefitting 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 that we are adding this year.
Mr. Flynn also noted: “Our focus on express, e-commerce and fast-growing markets provides a solid foundation to deliver continued business and earnings growth this year.
“We were pleased to announce an expansion of our relationship with Amazon in March. We are scheduled to begin flying five 737-800 aircraft on a CMI basis for Amazon this year, including two starting this month, with up to 15 more by May 2021. This opportunity provides a path to continued expansion in a desirable aircraft type, and it will enhance scale in the 737 platform we operate through Southern Air.
“Reflecting the scale and scope of our domestic and worldwide operations, we continue to anticipate that our adjusted net income in 2019 will grow by a mid- to upper-single-digit percentage compared with the record adjusted net income of $204.3 million that we reported in 2018.*
“In providing our current outlook, it is important to note that we are now including start-up expenses that we expect to incur in 2019 in connection with our new 737 CMI service. These start-up expenses were not incorporated in the full-year outlook we announced in February 2019.”
First-Quarter Results
Volumes in the first quarter of 2019 increased 16% to 77,061 block hours, with revenue growing 15% to $679.7 million and total direct contribution for reportable segments rising 21% to $104.7 million.
Increased ACMI segment revenue in the first quarter of 2019 primarily reflected an increase in flying partially offset by a slight decline in average rate per block hour. Block-hour growth during the period reflected increased 767 flying for Amazon, incremental 777 flying for DHL and the start-up of 747-400 flying for new customers. The change in average rate per block hour was primarily due to an increase in smaller-gauge 767 CMI flying.
ACMI segment contribution in the quarter was relatively unchanged compared with the year-ago period, primarily reflecting increases in 767 and 777 flying that were more than offset by higher crew costs, including enhanced wages and work rules resulting from our interim agreement with pilots at Southern Air; additional non-heavy maintenance and repairs; and increased amortization of deferred maintenance costs.
Higher Charter segment revenue during the period was primarily driven by increased flying and an increase in average rate per block hour. Higher block-hour volumes primarily reflected increases in military passenger and commercial cargo demand that were partially offset by a decrease in military cargo flying related to the unusually late cancellations of a number of flights by the military that did not permit adequate time to take advantage of alternative opportunities in the commercial market. Higher average rates during the quarter primarily reflected an increase in yields (excluding fuel) on passenger flying, mainly due to an increase in rates for the military and expanded flying for sports teams and other VIP charter customers.
Lower Charter segment contribution reflected the decrease in military cargo flying and additional non-heavy maintenance and repairs, partially offset by the increase in military passenger volumes and the expansion of our flying for sports teams and VIP-charter customers.
In Dry Leasing, higher segment revenue and contribution primarily reflected $22.3 million ($17.9 million after tax) from maintenance payments related to the scheduled return of a 777 freighter in March 2019 as well as the placement of incremental aircraft with customers.
Higher unallocated income and expenses, net, during the quarter primarily reflected fleet growth initiatives; increased amortization of a customer incentive asset; and a reduction in capitalized interest.
Reported earnings in the first quarter of 2019 also included an effective income tax expense rate of 19.7%, due mainly to the nondeductible change in the value of outstanding warrants. On an adjusted basis, our results reflected an effective income tax rate of 15.3%.
Cash and Short-Term Investments
At March 31, 2019, our cash and cash equivalents, short-term investments and restricted cash totaled $175.9 million, compared with $248.4 million at December 31, 2018.
The change in position resulted from cash used for investing activities and financing activities, partially offset by cash provided by operating activities.
Net cash used for investing activities during the first quarter of 2019 primarily related to capital expenditures and payments for flight equipment and modifications, including 767-300 aircraft and related freighter conversion costs, spare engines and GEnx engine performance upgrade kits.
Net cash used for financing activities during the period primarily reflected payments on debt obligations, partially offset by proceeds from debt issuance.
Updating 2019 Outlook*
We continue to expect solid full-year business and earnings growth in 2019.
Global economic activity and airfreight demand, supported by ongoing faster growth in express and e-commerce, are expected to continue to expand at a modest pace, while airfreight tonnage continues to grow from record levels.
Looking ahead, we expect to generate higher volumes, revenue, adjusted EBITDA and adjusted net income in 2019. We see volumes rising to around 340,000 block hours (with over 75% in ACMI and the balance in Charter), revenue of approximately $3.0 billion, and adjusted EBITDA of about $600 million.
We continue to anticipate that our adjusted net income will grow by a mid- to upper-single-digit percentage compared with 2018. However, our outlook now includes expected start-up expenses in 2019 associated with our new 737 CMI service, which were not incorporated in the full-year outlook we announced in February 2019. We continue to expect our full-year 2019 adjusted income tax rate to be approximately 20%.
We expect to fly approximately 80,000 block hours (over 75% in ACMI) in the second quarter of 2019, with revenue of about $710 million and adjusted EBITDA of about $105 million. We also expect that our second-quarter adjusted net income will represent slightly more than a mid-single-digit percentage of our full-year adjusted net income.
Earnings in the second quarter will benefit from flying by the incremental aircraft added to our fleet during 2018. However, we expect this benefit to be offset during the quarter by the timing of heavy and non-heavy maintenance; higher crew costs related primarily to our interim agreement with pilots at Southern Air; start-up expenses associated with the new 737 CMI agreement we announced in March; and the receipt in the second quarter of 2018 of an $8.6 million refund of aircraft rent paid in previous years.
For the full year, aircraft maintenance expense is expected to total approximately $420 million, mainly reflecting an increase in daily line maintenance due to the anticipated growth in block hours. Depreciation and amortization is expected to total approximately $260 million. In addition, core capital expenditures, which exclude aircraft and engine purchases, are expected to total approximately $135 to $145 million, mainly for parts and components for our fleet.
We provide guidance on an adjusted basis because we are unable to predict, with reasonable certainty, the effects of outstanding warrants and other items that could be material to our reported results.*
Conference Call
Management will host a conference call to discuss Atlas Air Worldwide’s first-quarter 2019 financial and operating results at 11:00 a.m. Eastern Time on Wednesday, May 1, 2019.
Interested parties may listen to the call live over the Internet at www.atlasairworldwide.com (click on “Investors,” click on “Presentations” and on the link to the first-quarter call) or at the following Web address:
https://edge.media-server.com/m6/p/rphxzkrf
For those unable to listen to the live call, a replay will be archived on the above websites following the call. A replay will also be available through May 9 by dialing (855) 859-2056 (U.S. Toll Free) or (404) 537-3406 (from outside the U.S.) and using Access Code 3469979#.
About Non-GAAP Financial Measures
To supplement our financial statements presented in accordance with U.S. GAAP, we present certain non-GAAP financial measures to assist in the evaluation of our business performance. These non-GAAP measures include Adjusted EBITDA; Adjusted income from continuing operations, net of taxes; Adjusted Diluted EPS from continuing operations, net of taxes; Adjusted effective tax rate; and Free Cash Flow, which exclude certain noncash income and expenses, and items impacting year-over-year comparisons of our results. These non-GAAP measures may not be comparable to similarly titled measures used by other companies and should not be considered in isolation or as a substitute for Income (loss) from continuing operations, net of taxes; Diluted EPS from continuing operations, net of taxes; Effective tax rate; and Net Cash Provided by Operating Activities, which are the most directly comparable measures of performance prepared in accordance with U.S. GAAP.
Our management uses these non-GAAP financial measures in assessing the performance of the company’s ongoing operations and in planning and forecasting future periods. We believe that these adjusted measures, when considered together with the corresponding U.S. GAAP financial measures and the reconciliations to those measures, provide meaningful supplemental information to assist investors and analysts in understanding our financial results and assessing our prospects for future performance. For example:
*We provide guidance on an adjusted basis and are unable to provide forwarding-looking guidance on a U.S. GAAP basis or a reconciliation to the most directly comparable U.S. GAAP measures because we are unable to predict with reasonable certainty the ultimate outcome of certain significant items. The principal item is the impact on our results of our outstanding warrants, which are highly dependent on the change in our stock price during the period reported. These items are uncertain, depend on various factors, and could have a material impact on our U.S. GAAP results.
About Atlas Air Worldwide:
Atlas Air Worldwide is a leading global provider of outsourced aircraft and aviation operating services. It is the parent company of Atlas Air, Inc., Southern Air Holdings, Inc. and Titan Aviation Holdings, Inc., and is the majority shareholder of Polar Air Cargo Worldwide, Inc. Our companies operate the world’s largest fleet of 747 freighter aircraft and provide customers the broadest array of Boeing 747, 777, 767, 757 and 737 aircraft for domestic, regional and international cargo and passenger operations.
Atlas Air Worldwide’s press releases, SEC filings and other information may be accessed through the company’s home page, www.atlasairworldwide.com.
This release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect Atlas Air Worldwide’s current views with respect to certain current and future events and financial performance. Those statements are based on management’s beliefs, plans, expectations and assumptions, and on information currently available to management. Generally, the words “will,” “may,” “should,” “expect,” “anticipate,” “intend,” “plan,” “continue,” “believe,” “seek,” “project,” “estimate,” and similar expressions used in this release that do not relate to historical facts are intended to identify forward-looking statements.
Such forward-looking statements speak only as of the date of this release. They are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the operations and business environments of Atlas Air Worldwide and its subsidiaries (collectively, the “companies”) that may cause the actual results of the companies to be materially different from any future results, express or implied, in such forward-looking statements.
Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, the following: our ability to effectively operate the network service contemplated by our agreements with Amazon; our ability to coordinate with Amazon to accept newly converted aircraft; the risk that the anticipated benefits of our agreements with Amazon will not be realized when expected, or at all; the possibility that Amazon may terminate its agreements with the companies; the ability of the companies to operate pursuant to the terms of their financing facilities; the ability of the companies to obtain and maintain normal terms with vendors and service providers; the companies’ ability to maintain contracts that are critical to their operations; the ability of the companies to fund and execute their business plan; the ability of the companies to attract, motivate and/or retain key executives, pilots and associates; the ability of the companies to attract and retain customers; the continued availability of our wide-body aircraft; demand for cargo services in the markets in which the companies operate; economic conditions; the effects of any hostilities or act of war (in the Middle East or elsewhere) or any terrorist attack; significant data breach or disruption of our information technology systems; labor costs and relations, work stoppages and service slowdowns; the outcome of pending negotiations with our pilots’ union; financing costs; the cost and availability of war risk insurance; aviation fuel costs; security-related costs; competitive pressures on pricing (especially from lower-cost competitors); volatility in the international currency markets; weather conditions; government legislation and regulation; additional regulatory guidance or changes in interpretations and assumptions with respect to the impact of the U.S. Tax Cuts and Jobs Act of 2017; consumer perceptions of the companies’ products and services; anticipated and future litigation; and other risks and uncertainties set forth from time to time in Atlas Air Worldwide’s reports to the United States Securities and Exchange Commission.
For additional information, we refer you to the risk factors set forth under the heading “Risk Factors” in the most recent Annual Report on Form 10-K and subsequent reports on Form 10-Q filed by Atlas Air Worldwide with the Securities and Exchange Commission. Other factors and assumptions not identified above may also affect the forward-looking statements, and these other factors and assumptions may also cause actual results to differ materially from those discussed.
Except as stated in this release, Atlas Air Worldwide is not providing guidance or estimates regarding its anticipated business and financial performance for 2019 or thereafter.
Atlas Air Worldwide assumes no obligation to update such statements contained in this release to reflect actual results, changes in assumptions or changes in other factors affecting such estimates other than as required by law and expressly disclaims any obligation to revise or update publicly any forward-looking statement to reflect future events or circumstances.
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PURCHASE, N.Y., April 4, 2019 – Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW) today announced that its Atlas Air, Inc. unit and Qantas Freight have enhanced their long-standing ACMI (aircraft, crew, maintenance and insurance) relationship.
Under the terms of the agreement, Atlas Air will operate two Boeing 747-8 Freighters in ACMI service for Qantas on transpacific routes linking Australia and Asia with the United States beginning in late July 2019. The aircraft will replace two Boeing 747-400 Freighters currently in service for Qantas.
The 747-8Fs will provide additional revenue cargo volume to serve the strong growth in demand across Qantas’ international freight network. The 747-400Fs are expected to enter into ACMI service for other Atlas Air customers.
“Our enhanced agreement builds upon a strong and successful 15-year partnership between Atlas Air and Qantas and will capitalize on the state-of-the-art service solutions provided by our aircraft and crews,” said William J. Flynn, President and Chief Executive Officer, Atlas Air Worldwide. “We look forward to supporting Qantas as it continues to capture market opportunities and enhance its position as a premier international airline.”
Andrew David, CEO of Qantas Domestic and Freight, said, “Wet-leasing these newer, more efficient Boeing 747-8Fs from Atlas Air will allow us to provide a better service for our customers with additional freight capacity and even greater reliability for time-sensitive shipments.”
The 747-8Fs to be operated for Qantas will be allocated to it following the expiration of an existing ACMI agreement with another Atlas customer.
About Atlas Air Worldwide:
Atlas Air Worldwide is a leading global provider of outsourced aircraft and aviation operating services. It is the parent company of Atlas Air, Inc., Southern Air Holdings, Inc. and Titan Aviation Holdings, Inc., and is the majority shareholder of Polar Air Cargo Worldwide, Inc. Our companies operate the world’s largest fleet of 747 freighter aircraft and provide customers the broadest array of Boeing 747, 777, 767, 757 and 737 aircraft for domestic, regional and international cargo and passenger operations.
Atlas Air Worldwide’s press releases, SEC filings and other information may be accessed through the company’s home page, www.atlasairworldwide.com.
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PURCHASE, N.Y., February 24, 2019 – It is with great sadness that Atlas Air Worldwide (Nasdaq: AAWW) has confirmed that the three people on board Atlas Air Flight 3591 did not survive the accident on Saturday, February 23, 2019, in Anahuac, Texas.
Atlas’ primary focus is working to provide the families of those affected with care and support. The company has established a Family Assistance Center staffed with specialists to support the families. Atlas Air Chief Executive Officer Bill Flynn is on site with a team from the airline.
“Our thoughts and prayers are with all those who have been affected,” said Bill Flynn, Atlas Air Chief Executive Officer. “This is a sad time for all of us. Our team continues to work closely with the NTSB, the FAA and local authorities on the ground in Houston. We would like to commend the efforts of all of the first responders. We sincerely appreciate their efforts and support in the investigation.”
Atlas will continue to provide updates as additional information becomes available.
More information on Atlas Air can be found at www.atlasairworldwide.com.
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PURCHASE, N.Y., February 23, 2019 – Atlas Air Worldwide (Nasdaq: AAWW): As was previously reported Atlas Air flight 3591 was involved in an accident earlier today. Three people were onboard at the time.
At this stage, a search investigation is underway. In the meantime, we are providing all possible information to the families and loved ones of those onboard.
The flight from Miami to Houston was a cargo flight operated by Atlas Air on behalf of Amazon. We have activated our emergency response plans, and we will be sending a specialist team to the crash site.
Everyone within the company is deeply saddened by this event. Our main priority at this time is caring for those affected, and we will ensure we do all we can to support them.
We are now working with the emergency services and other agencies to establish the circumstances around exactly what happened. Further updates will be available on our website.
More information on Atlas Air can be found at www.atlasairworldwide.com.
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PURCHASE, N.Y., February 23, 2019 – Atlas Air Worldwide (Nasdaq: AAWW): This is to confirm that an Atlas Air 767 cargo aircraft Flight No. 3591 operating from Miami to Houston has been involved in an accident this afternoon. We understand the aircraft went down near the city of Anahuac Texas, in the Trinity Bay. We can confirm there were three people on board the aircraft. Those people and their family members are our top priority at this time. Atlas Air is cooperating fully with the FAA and NTSB. We will update as additional information becomes available.
Atlas Air Worldwide’s press releases, SEC filings and other information may be accessed through the company’s home page, www.atlasair.com.
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PURCHASE, N.Y., February 19, 2019 – Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW) today announced record fourth-quarter and full-year volumes, revenue and earnings in 2018, and an outlook for continued growth in 2019.
“2018 was another great year for Atlas, with substantial growth in the scale, diversity and profitability of our business,” said President and Chief Executive Officer William J. Flynn.
“Going forward, we are excited about Atlas’ future and the future of airfreight. We expect record Atlas volumes and earnings in 2019 driven by our multiyear initiatives, which enable us to serve a greater range of customers and provide a solid platform for future growth initiatives.
“Our focus is on express and e-commerce, and fast-growing markets in Asia and elsewhere, such as South America, where we had the strongest year in the company’s history. As airfreight tonnage continues to grow, further globalization will require time-definite air networks to facilitate the flow of goods.”
He added: “We are well-positioned to capitalize on the scale and scope of our domestic and worldwide operations, to drive record volume, revenue, adjusted EBITDA and adjusted net income this year, and to further reduce our net leverage ratio.*
“We expect to benefit from a full-year of flying by the aircraft we added in 2018 for customers such as Asiana, DHL Express, Inditex and SF Express. We will see our first year of flying twenty 767-300s for Amazon. We look forward to operating three incremental 747-400 freighters for Nippon Cargo Airlines, which will increase our near-term fleet to 115 aircraft. And we anticipate that the flying we do for the military will be higher than the flying we did in 2018.
“As a result of the momentum that we see, we anticipate that our adjusted net income in 2019 will grow by a mid- to upper-single-digit percentage this year.”*
Mr. Flynn continued: “These opportunities build on the growth in our business mix, customer base, fleet and operational capabilities.
“In addition to delivering record results in 2018, we added 16 aircraft to our operating fleet in response to customer demand, with more than 100 planes for the first time. We ended the year with 112 aircraft across five fleet types that are well-suited to our growing domestic and regional cargo and passenger operations, as well as our long-haul, international operations.
“We also ramped up for Amazon as scheduled, which included successfully managing multiple station openings throughout the U.S. We implemented continuous improvement initiatives and tax planning that enhanced our bottom line. We also enhanced our balance sheet by lowering our net leverage ratio.
“Thanks to our strong and experienced team, we executed our peak-season operations extremely well. Overlapping the end of peak, we also operated 32 flights during the college football bowl season for 15 universities.”
Fourth-Quarter Results
Volumes in the fourth quarter of 2018 increased 17% to 83,437 block hours, with revenue growing 22% to a record $765.0 million.
Reported income from continuing operations, net of taxes, during the period increased 1% to $211.0 million, or $2.73 per diluted share, compared with $209.5 million, or $6.71 per diluted share, in the fourth quarter of 2017. Reported results in the latest quarter included an unrealized gain on outstanding warrants of $134.8 million compared with a $130.0 million benefit related to the revaluation of deferred tax liabilities as a result of the U.S. Tax Cuts and Jobs Act and an unrealized gain on outstanding warrants of $23.7 million in the year-ago period.
On an adjusted basis, income from continuing operations, net of taxes, in the fourth quarter of 2018 increased 31% to a record $87.0 million, or $3.12 per diluted share, from adjusted income of $66.6 million, or $2.43 per diluted share, in the year-ago quarter. Adjusted EBITDA increased 21% over the year-ago period to $196.5 million.
ACMI segment contribution in the fourth quarter of 2018 increased slightly compared with the prior-year period, primarily due to increases in 747-400F revenue per block hour and volumes. These were partially offset by higher heavy maintenance costs, including an increase in the proportion of heavy maintenance costs attributed to the segment due to our volume-based allocation methodology and the higher levels of ACMI flying during the December ACMI peak flying period; amortization of deferred maintenance costs; and higher crew costs, including enhanced wages and work rules resulting from an interim labor agreement with our Southern Air pilots. Block hours grew 19% during the period, reflecting the start-up of 747-400 flying for several new customers and increased 767 flying for Amazon. Overall revenue per block hour during the quarter was relatively in line with the fourth quarter of 2017, primarily due to a mix effect reflecting the increase in smaller-gauge 767 CMI flying.
Higher Charter segment contribution during the period was primarily driven by increases in military and commercial cargo yields excluding fuel and higher military cargo demand, partially offset by higher heavy maintenance costs.
Both ACMI and Charter segment contribution during the quarter reflected the redeployment of two 747-400 VIP-configured passenger aircraft from ACMI to Charter following our acquisition of these aircraft from a former CMI customer. We have used the aircraft to grow our VIP charter business and earnings.
In Dry Leasing, higher segment contribution primarily reflected the placement of eight additional 767-300 converted aircraft throughout 2018, as well as the placement of one 777-200 freighter in February 2018 and a second one in July 2018.
Higher unallocated income and expenses, net during the quarter primarily reflected fleet growth initiatives; increases in unallocated interest expense and amortization of a customer incentive asset; and a ratification bonus related to an interim agreement with our Southern Air pilots.
Reported earnings in the fourth quarter of 2018 also included an effective income tax rate of 9.4%, due mainly to nondeductible or nontaxable changes in the value of outstanding warrants. On an adjusted basis, our results reflected an effective income tax rate of 20.5%.
Full-Year Results
Volumes in 2018 increased 17% to 296,264 block hours, with revenue growing 24% to a record $2.7 billion.
Reported income from continuing operations, net of taxes, for the twelve months ended December 31, 2018, increased 21% to $270.6 million, or $5.22 per diluted share, which included an unrealized gain on financial instruments of $123.1 million related to outstanding warrants. For the twelve months ended December 31, 2017, our reported income from continuing operations totaled $224.3 million, or $8.68 per diluted share, which included $130.0 million of benefit related to the revaluation of deferred tax liabilities as a result of the U.S. Tax Cuts and Jobs Act, partially offset by an unrealized loss on financial instruments of $12.5 million related to outstanding warrants.
On an adjusted basis, income from continuing operations, net of taxes, in 2018 increased 53% to a record $204.3 million, or $7.27 per diluted share, compared with $133.7 million, or $4.93 per diluted share, in 2017. Adjusted EBITDA in 2018 rose 26% to $540.6 million.
Reported earnings in 2018 also included an effective income tax rate of 12.5%, primarily due to nondeductible and nontaxable changes in the value of outstanding warrants as well as a deferred income tax benefit related to the renewal of our Titan dry-leasing subsidiary’s participation in an aircraft leasing incentive program in Singapore. On an adjusted basis, our results reflected an effective income tax rate of 15.2%.
Cash and Short-Term Investments
At December 31, 2018, our cash, cash equivalents, short-term investments and restricted cash totaled $248.4 million, compared with $305.5 million at December 31, 2017.
The change in position resulted from cash used for investing activities, partially offset by cash provided by operating and financing activities.
Net cash used for investing activities during 2018 primarily related to capital expenditures and payments for flight equipment and modifications, including the acquisition of 777-200 aircraft, 767-300 passenger aircraft and related freighter-conversion costs, spare engines and GEnx engine performance upgrade kits.
Net cash provided by financing activities during 2018 primarily reflected proceeds from our financings of 777-200 and 767-300 aircraft, partially offset by payments on debt obligations.
2019 Outlook*
We expect continued solid business and earnings growth in 2019.
In addition to the essential building blocks we have set in place, we will have a full year of flying by the aircraft we added to our fleet in 2018. We also see opportunities to grow with existing customers, such as the incremental flying we will begin to do for Nippon Cargo Airlines, and to add new ones.
Global economic activity and airfreight demand are expected to expand at a moderate pace, while airfreight tonnage continues to grow from record levels.
As a result, we expect to generate higher volumes, revenue, adjusted EBITDA and adjusted net income in 2019. We see volumes rising to around 340,000 block hours (with over 75% in ACMI and the balance in Charter), revenue of approximately $3.0 billion, and adjusted EBITDA of about $600 million.
We also anticipate that our adjusted net income will grow by a mid- to upper-single-digit percentage compared with 2018. We expect our full-year 2019 adjusted income tax rate to be approximately 20%.
Similar to historical patterns, we anticipate over three-quarters of our adjusted net income in 2019 occurring in the second half.
In addition, we expect to fly approximately 75,000 block hours (over 75% in ACMI) in the first quarter of 2019, with revenue of approximately $680 million, adjusted EBITDA of about $110 million, and adjusted net income similar to our adjusted net income of $23.8 million in the first quarter of 2018. Our first-quarter 2019 outlook includes revenue in our Dry Leasing segment from maintenance payments related to the scheduled return of a 777-200 cargo aircraft, which we expect to receive late in the quarter, partially offset by higher heavy maintenance expense compared with the year-ago first quarter.
Aircraft maintenance expense in 2019 is expected to total approximately $420 million. The increase from 2018 mainly reflects an increase in daily line maintenance driven by the growth of our fleet and the anticipated growth in our block hours this year. Similar to 2018, we expect line maintenance to comprise about two-thirds of our total maintenance expense for the year.
Depreciation and amortization is expected to total approximately $260 million. In addition, core capital expenditures, which exclude aircraft and engine purchases, are expected to total approximately $135 to $145 million, mainly for parts and components for our fleet.
We provide guidance on an adjusted basis because we are unable to predict, with reasonable certainty, the effects of outstanding warrants and other items that could be material to our reported results.*
Conference Call
Management will host a conference call to discuss Atlas Air Worldwide’s fourth-quarter and full-year 2018 financial and operating results at 11:00 a.m. Eastern Time on Tuesday, February 19, 2019.
Interested parties may listen to the call live over the Internet at www.atlasairworldwide.com (click on “Investors,” click on “Presentations” and on the link to the fourth-quarter call) or at the following Web address:
https://edge.media-server.com/m6/p/ytrz2pp3
For those unable to listen to the live call, a replay will be archived on the above websites following the call. A replay will also be available through February 27 by dialing (855) 859-2056 (U.S. Toll Free) or (404) 537-3406 (from outside the U.S.) and using Access Code 5889507#.
About Non-GAAP Financial Measures
To supplement our financial statements presented in accordance with U.S. GAAP, we present certain non-GAAP financial measures to assist in the evaluation of our business performance. These non-GAAP measures include Adjusted EBITDA; Adjusted income from continuing operations, net of taxes; Adjusted Diluted EPS from continuing operations, net of taxes; Adjusted effective tax rate; and Free Cash Flow, which exclude certain noncash income and expenses, and items impacting year-over-year comparisons of our results. These non-GAAP measures may not be comparable to similarly titled measures used by other companies and should not be considered in isolation or as a substitute for Income (loss) from continuing operations, net of taxes; Diluted EPS from continuing operations, net of taxes; Effective tax rate; and Net Cash Provided by Operating Activities, which are the most directly comparable measures of performance prepared in accordance with U.S. GAAP.
Our management uses these non-GAAP financial measures in assessing the performance of the company’s ongoing operations and in planning and forecasting future periods. We believe that these adjusted measures, when considered together with the corresponding U.S. GAAP financial measures and the reconciliations to those measures, provide meaningful supplemental information to assist investors and analysts in understanding our financial results and assessing our prospects for future performance. For example:
*We provide guidance on an adjusted basis and are unable to provide forwarding-looking guidance on a U.S. GAAP basis or a reconciliation to the most directly comparable U.S. GAAP measures because we are unable to predict with reasonable certainty the ultimate outcome of certain significant items. The principal item is the impact on our results of our outstanding warrants, which are highly dependent on the change in our stock price during the period reported. These items are uncertain, depend on various factors, and could have a material impact on our U.S. GAAP results.
About Atlas Air Worldwide:
Atlas Air Worldwide is a leading global provider of outsourced aircraft and aviation operating services. It is the parent company of Atlas Air, Inc., Southern Air Holdings, Inc. and Titan Aviation Holdings, Inc., and is the majority shareholder of Polar Air Cargo Worldwide, Inc. Our companies operate the world’s largest fleet of 747 freighter aircraft and provide customers the broadest array of Boeing 747, 777, 767, 757 and 737 aircraft for domestic, regional and international cargo and passenger operations.
Atlas Air Worldwide’s press releases, SEC filings and other information may be accessed through the company’s home page, www.atlasairworldwide.com.
This release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect Atlas Air Worldwide’s current views with respect to certain current and future events and financial performance. Those statements are based on management’s beliefs, plans, expectations and assumptions, and on information currently available to management. Generally, the words “will,” “may,” “should,” “expect,” “anticipate,” “intend,” “plan,” “continue,” “believe,” “seek,” “project,” “estimate,” and similar expressions used in this release that do not relate to historical facts are intended to identify forward-looking statements.
Such forward-looking statements speak only as of the date of this release. They are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the operations and business environments of Atlas Air Worldwide and its subsidiaries (collectively, the “companies”) that may cause the actual results of the companies to be materially different from any future results, express or implied, in such forward-looking statements.
Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, the following: our ability to effectively operate the network service contemplated by our agreements with Amazon, including the risk that the anticipated benefits of our agreements with Amazon will not be realized; the possibility that Amazon may terminate its agreements with the companies; the ability of the companies to operate pursuant to the terms of their financing facilities; the ability of the companies to obtain and maintain normal terms with vendors and service providers; the companies’ ability to maintain contracts that are critical to their operations; the ability of the companies to fund and execute their business plan; the ability of the companies to attract, motivate and/or retain key executives, pilots and associates; the ability of the companies to attract and retain customers; the continued availability of our wide-body aircraft; demand for cargo services in the markets in which the companies operate; economic conditions; the effects of any hostilities or act of war (in the Middle East or elsewhere) or any terrorist attack; significant data breach or disruption of our information technology systems; labor costs and relations, work stoppages and service slowdowns; the outcome of pending negotiations with our pilots’ union; financing costs; the cost and availability of war risk insurance; aviation fuel costs; security-related costs; competitive pressures on pricing (especially from lower-cost competitors); volatility in the international currency markets; weather conditions; government legislation and regulation; additional regulatory guidance or changes in interpretations and assumptions with respect to the impact of the U.S. Tax Cuts and Jobs Act of 2017; consumer perceptions of the companies’ products and services; anticipated and future litigation; and other risks and uncertainties set forth from time to time in Atlas Air Worldwide’s reports to the United States Securities and Exchange Commission.
For additional information, we refer you to the risk factors set forth under the heading “Risk Factors” in the most recent Annual Report on Form 10-K and subsequent reports on Form 10-Q filed by Atlas Air Worldwide with the Securities and Exchange Commission. Other factors and assumptions not identified above may also affect the forward-looking statements, and these other factors and assumptions may also cause actual results to differ materially from those discussed.
Except as stated in this release, Atlas Air Worldwide is not providing guidance or estimates regarding its anticipated business and financial performance for 2019 or thereafter.
Atlas Air Worldwide assumes no obligation to update such statements contained in this release to reflect actual results, changes in assumptions or changes in other factors affecting such estimates other than as required by law and expressly disclaims any obligation to revise or update publically any forward-looking statement to reflect future events or circumstances.
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Conference Call/Webcast – 11:00 A.M. Eastern
PURCHASE, N.Y., January 30, 2019 – Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW) will release results for the fourth quarter and full year ended December 31, 2018, prior to the opening of stock market trading on Tuesday, February 19.
William J. Flynn, Atlas Air Worldwide’s President and Chief Executive Officer, and Spencer Schwartz, Executive Vice President and Chief Financial Officer, will host a conference call to discuss the company’s results at 11:00 a.m. Eastern Time on February 19.
Interested parties may listen to the call live over the Internet at www.atlasairworldwide.com (click on “Investors,” click on “Presentations” and on the link to the fourth-quarter call) or at the following Web address:
https://edge.media-server.com/m6/p/ytrz2pp3
For those unable to listen to the live call, a replay will be archived on the above websites following the call. A replay will also be available through February 27 by dialing (855) 859-2056 (U.S. Toll Free) or (404) 537-3406 (from outside the U.S.) and using Access Code 5889507#.
Slides complementing the remarks by Mr. Flynn and Mr. Schwartz will be available for downloading from Atlas Air Worldwide’s website prior to the call.
About Atlas Air Worldwide:
Atlas Air Worldwide is a leading global provider of outsourced aircraft and aviation operating services. It is the parent company of Atlas Air, Inc., Southern Air Holdings, Inc. and Titan Aviation Holdings, Inc., and is the majority shareholder of Polar Air Cargo Worldwide, Inc. Our companies operate the world’s largest fleet of 747 freighter aircraft and provide customers the broadest array of Boeing 747, 777, 767, 757 and 737 aircraft for domestic, regional and international cargo and passenger operations.
Atlas Air Worldwide’s press releases, SEC filings and other information may be accessed through the company’s home page, www.atlasairworldwide.com.
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Three More Aircraft Added to Strategic Agreement
PURCHASE, N.Y., January 8, 2019 – Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW) today announced that its Atlas Air, Inc. unit has expanded its strategic agreement with Nippon Cargo Airlines (NCA) to add three NCA-owned Boeing 747-400 Freighters to the existing operation, bringing the total number of 747-400Fs operated on behalf of NCA to five.
The incremental aircraft will be operated on key routes across the fast-growing transpacific market, and are scheduled to enter service in April, July and September 2019.
“We are delighted to grow our partnership with Nippon Cargo Airlines,” said William J. Flynn, President and Chief Executive Officer, Atlas Air Worldwide. “NCA has selected Atlas Air to operate its entire 747-400F fleet, and we look forward to continuing to provide NCA and its customers with an unmatched service and a platform for future global expansion.”
Hitoshi Oshika, President and Chief Executive Officer, NCA, said “The partnership with Atlas has enabled NCA to expand our network to capture growth opportunities throughout Asia. The addition of these three aircraft will allow NCA to provide our customers with additional airfreight capacity, especially for the growing e-commerce business.”
About Atlas Air Worldwide:
Atlas Air Worldwide is a leading global provider of outsourced aircraft and aviation operating services. It is the parent company of Atlas Air, Inc., Southern Air Holdings, Inc. and Titan Aviation Holdings, Inc., and is the majority shareholder of Polar Air Cargo Worldwide, Inc. Our companies operate the world’s largest fleet of 747 freighter aircraft and provide customers the broadest array of Boeing 747, 777, 767, 757 and 737 aircraft for domestic, regional and international cargo and passenger operations.
Atlas Air Worldwide’s press releases, SEC filings and other information may be accessed through the company’s home page, www.atlasairworldwide.com.
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