For Q4 2016 Atlas Air Worldwide Holdings has announced income from continuing operations of $28.7m, which included an unrealized loss on financial instruments of $27.9m related to outstanding warrants. Results compared with a loss from continuing operations of $37.6m for the comparable period in 2015, which was primarily due to charges of $102.8m associated with a litigation settlement.
On an adjusted basis, income from continuing operations in Q4 2016 totalled $59.0m compared with $39.4m in the comparable period in 2015.
ACMI segment revenues in Q4 2016 were primarily driven by the acquisition of Southern Air and lower heavy maintenance expense. Segment revenue growth benefited from an increase in block-hour volumes, partially offset by a lower average rate per block hour.
Higher Charter segment contribution during the period reflected an increase in commercial cargo demand. Lower revenue per block hour during the period was primarily due to a reduction in fuel prices in 2016.
Segment contribution in Dry Leasing was slightly better on a year-over-year basis.
For the full year 2016, the company generated income of $42.6m compared to $7.3m in 2015. On an adjusted basis, income from continuing operations in 2016 totalled $114.3m compared with $125.3m in 2015.
At December 31, 2016, the company’s cash, cash equivalents, restricted cash and short-term investments totalled $142.6m, compared with $444.0m at December 31, 2015.
Both reported and adjusted results in 2016 reflected the impact of start-up expenses for the company’s new service for Amazon, while reported and adjusted results in 2015 benefited from U.S. West Coast port-congestion-related earnings.
William J. Flynn, President and Chief Executive Officer, commented: “2016 was a historic year for Atlas, and we finished it on a strong note. We acquired Southern Air, expanding the array of aircraft and services that we provide, especially to the fast-growing express market. We entered into strategic, long-term agreements with Amazon to serve its rapidly growing e-commerce business. And we generated strong sequential and year-over-year improvements in our block-hour volumes, revenue, profitability and margins in the fourth quarter. In addition to record revenues in the quarter, we delivered a significant increase in reported earnings and record adjusted earnings for the period.”
He added: “In addition to the demand we are seeing for our aircraft and services, including our recently announced agreements with Asiana Cargo, Nippon Cargo Airlines and FedEx, we expect to see initial accretion from our operations for Amazon and a full year of contribution from Southern Air in 2017. We expect those positives to be partially offset by an increase in maintenance expense and lower cost-based rates paid by the military. As a result, we expect to increase adjusted income from continuing operations, net of taxes, by a mid-single-digit to low-double-digit percentage in 2017.”
Source: Atlas Air Worldwide