Atlas: first Amazon freighter to enter service "in this quarter"
03 / 08 / 2016
Atlas Air Worldwide Holdings (AAWW) expects to place its first freighter aircraft into service for internet retail giant Amazon “soon in this quarter”.
President and chief executive Bill Flynn, announcing the US-based freighter lessor's second quarter 2016 results, said: “We have secured all of the conversion slots and the vast majority of the feedstock aircraft required to support 20 B767-300s for Amazon by the end of 2018.”
Atlas announced income from continuing operations, net of taxes, of $20.9m, or a loss of $0.26 per diluted share, reflecting “the impact of warrant accounting and transaction-related expenses, for the three months ended June, compared with $28.4m in prior year like period.
“The second quarter was one of the most important in the company’s history,” said Flynn, continuing: “We acquired Southern Air and added two new operating platforms. And we agreed with Amazon to lease and operate 20 B767-300s.
“We believe strongly in the future of airfreight, especially in the future of the express and e-commerce sectors.”
In May this year, Amazon signed up to lease 20 B767-300 freighters from AAWW, a deal which granted Amazon warrants to acquire up to 20% of Atlas' common shares at $37.50 per share over five years, with vesting tied in part to the commencement of operations of the freighters and other conditions.
The Atlas deal came after a similar freighter and share stake partnership that Amazon announced in March 2016 with US freighter lessor ATSG, for a mix of B767-300s and B767-200s.
In April this year, Atlas also completed its acquisition of Southern Air Holdings in a deal worth $110m. The Southern deal, which was funded with cash on hand, provided Atlas entry into the Boeing 777 and B737 aircraft market.
Added Flynn: “Our quarterly earnings also reflected an increase in military cargo and passenger demand but a slower pace in general commercial cargo. In addition, we incurred initial start-up expenses in preparation for our new long-term 767 service for Amazon and its growing e-commerce business.
“Led by the strength of our brand and our global market leadership in outsourced aircraft and services, we are uniquely situated to continue to leverage our core competencies, diversify our business mix, and develop new organizational capabilities to drive business growth.”