Atlas announces B747F leases and improving Q2 financials
02 / 08 / 2017
Atlas Air Worldwide has reported improvements in second-quarter revenues and profits, while also announcing the placement of three freighters with Hong Kong Air Cargo Carrier.
Shortly before announcing its second-quarter results, the Purchase-headquartered aircraft lessor announced that it had placed three Boeing 747-400 freighters with Hong Kong Air Cargo on an aircraft, crew, maintenance and insurance deal (ACMI).
The first aircraft will begin flying for the airline in September on routes between Asia and the US. The second and third aircraft are expected to commence operations during 2018.
Guo Song Zhong, chairman and chief executive of Hong Kong Air Cargo, said: “After strengthening our regional network in recent years, it is now time to expand our transpacific network and look into other markets such as Europe, Australia, Africa and Latin America as we move forward.”
Meanwhile, the lessor also reported its second-quarter results. Operating revenues for the period increased by 16.7% year on year to $517.4m, operating income improved by 8.6% against last year to $58.5m and net income reached $39m compared with $20.6m in 2016.
The income results included an unrealised gain on financial instruments of $13.8m related to outstanding warrants.
On an adjusted basis, income from continuing operations net tax totalled $29.1m against $20.2m a year ago.
The improved result came from across the business, in its ACMI, charter and dry leasing divisions.
President and chief executive William Flynn said: “Our growth also reflected an increase in aircraft utilisation and a rise in commercial charter yields.
“During the quarter, we started flying for Cathay Pacific and Yangtze River Airlines and added four 767-300 freighters for Amazon, including our fifth and sixth aircraft in June.
“We are experiencing good momentum in our business, and we expect that to carry through 2017, into 2018 and beyond.”
As a result of the performance, the company increased its full-year 2017 outlook and now anticipates that adjusted income from continuing operations, net of taxes, will grow by a percentage in the mid-teens this year, approximately double the midpoint of our previous outlook.
Looking forward, Flynn said: “We have a strategic focus on the fast-growing Chinese and Asian markets, and we have added five new customers there this year.
“We also continue to move more deeply into the faster-growing express and e-commerce markets. More than 70% of our current freighters operate for customers in these markets, and that percentage will increase as we ramp up from six aircraft for Amazon currently to an expected 20 by the end of 2018.
“The evolution of e-commerce is transforming the global supply chain and creating significant new opportunities for Atlas. Freighter aircraft in scaled route networks, such as those that we operate, provide the just-in-time service that enables consumers to receive their orders as quickly as possible.”
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