Vertannes looks back over 44 years in air cargo

Des Vertannes, with his retirement as IATA’s head of cargo this month, brings to a close a 44-year career in air cargo. He has become known as a passionate airfreight ambassador and an ardent catalyst for the movement toward a paperless industry.

Vertannes began his career with British Airways in 1970, holding several management positions across 14 years. In 1984, he established his own forwarding business before joining Air Canada as general manager, cargo, in 1991. He subsequently was chief executive with Air Menzies International, was managing director at Menzies World Cargo and was head of cargo at Gulf Air and Etihad. He joined IATA four years ago.

As he looks back over 44 years in the business, it’s no surprise that the personable Vertannes says what he will miss most is the people of air cargo.

“Certainly, the people I have worked with at the six companies I have worked for have been an influential part of my life,” Vertannes says. “I’ve been fortunate to have been able to work in different parts of the world and make contributions within the industry.”

Vertannes embraced innovation throughout his career and in recent years became perhaps the industry’s biggest catalyst for going paperless. He says it’s a bigger challenge than most people think, but he’s convinced the industry will get there in a few years.

“I have always felt very passionate about the industry and its need to serve its principal customers,” Vertannes says. “My view is that the need to innovate and evolve has always been there. I think when I look at the paperless aspirations, it’s one small component of the need for the industry to redefine its value proposition. I am extremely motivated by the fact it needs to achieve the goal. A lot of people do not understand why it has taken so long to get here. The sheer complexity of the paperless aspiration with the architecture and infrastructure the industry has in place today – I would love to see it escalated and accelerated. I believe we will see that in the months and years ahead.”

Looking into his crystal ball, Vertannes believes there will be much more interaction along the industry’s chain with airlines, forwarders, GSSAs and handlers working in partnership, as they never have before. He also believes his proposal to peel 48 hours off transit times is achievable as the industry embraces more cohesive data transfer procedures.

The industry’s myriad challenges notwithstanding, Vertannes sees a bright future.

“I have always been an optimist, a natural optimist about the industry. I really believe that given how I see world trade and the need for extended world trade with a growing population, particularly the growing population within what I call the megacities of this world and an increasing urban population. I believe air cargo will have a very prosperous future. You cannot sustain life in the big urban cities without very good air cargo service. I also believe airports will wake up to importance of air cargo and we will see far greater investments in facilities in the decades to come.”

Is there a chance of Vertannes returning to cargo down the road? Not in the near future, he says.

“I made a promise to the family that I will dedicate quite a bit of time to Gloria and the children, and the expanding number of grandchildren coming my way. We had No. 6 in April and No. 7 is due in August. I would like to spend some quality time with my family. Who knows what the future brings. My immediate plans are to take a complete break.”

 

Tributes from colleagues

Des will be sorely missed by all those who shared paths with him throughout his illustrious career within the air cargo industry. While I did not have the privilege of working with him during his tenure at Air Canada Cargo, where he held the position of General Manager Cargo-Europe from 1995-1999, I still hear very positive comments from those he did lead at the time. Des’ wonderful leadership and deep understanding of our industry served to teach us and to lead us down the straight road. Always a good listener, solution-oriented and forever the perfect diplomat, he reassured and inspired us all. We will miss his gentle turn of phrase and good humor. I wish Des the very best for this well deserved retirement. Over to us now to pursue the direction, which he has so clearly articulated for our industry.

Article source: http://www.aircargoworld.com/Air-Cargo-World-News/2014/05/vertannes-looks-back-over-44-years-air-cargo/6541

Accenture Updates Freight and Logistics Software for Increased Cargo Yields and Alliance Partner Support

NEW YORK–(BUSINESS WIRE)–

Accenture (ACN) announced a new version of its Air Cargo Reservations software, part of the Accenture Freight and Logistics Software portfolio, designed to help air cargo carriers improve profitability and efficiency. This new version gives carriers greater flexibility in managing reservations, including flights with alliance partners, resulting in optimized freight capacity and minimized revenue leakage.

Accenture Air Cargo Reservations version 6.0 is designed to be an intuitive, easy-to-use product that allows air carriers to book accurate, timely, and flexible reservations. New enhancements help enable carriers:

  • Prevent revenue leakage: Advanced segmentation and dynamic capacity control techniques allow orders to be matched with the most appropriate and cost-effective flights. This enables carriers to optimize free sale capacity and available space, and minimize lost revenue opportunities.
  • Provide inventory management for alliance partner airlines: New joint inventory management functionality provides a single view of inventory across multiple alliance partners. This includes integration with multiple systems for alliance-wide visibility and joint capacity management.
  • Make fast, profitable decisions: Increased visibility throughout the shipment life cycle brings revenue and cost information together so that carriers can make better real-time business decisions regarding availability and pricing. Automated integration with an enhanced cost engine creates increased cost transparency and allows carriers to build rules and restrictions into the quoting and reservations process.
  • Improve customer service and asset utilization: An enhanced, easy to use user interface gives greater transparency and visibility of key information, enabling revenue managers and booking agents to make informed decisions and provide better customer service. For instance, the system provides a complete view of booking history and route details for all flights, allowing carriers to make real-time adjustments that maximize customer service and asset utilization.

“In order to cut costs and gain efficiencies, we know that air cargo carriers often look at their logistics chain first,” said Malcolm McNamara, global managing director of Accenture Freight and Logistics Software. “Accenture’s Air Cargo Reservations software helps maximize air cargo carriers’ business results by providing greater transparency in data for improved pricing strategies and cargo yields, better decision making, more efficient use of assets and increased customer satisfaction.”

Combining an experienced team with leading-edge software and a global delivery capability, Accenture Freight and Logistics software helps organizations realize value from their technology investments and manage the escalating challenges of changing markets.

About Accenture

Accenture is a global management consulting, technology services and outsourcing company, with approximately 289,000 people serving clients in more than 120 countries. Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the world’s most successful companies, Accenture collaborates with clients to help them become high-performance businesses and governments. The company generated net revenues of US$28.6 billion for the fiscal year ended Aug. 31, 2013. Its home page is www.accenture.com.

Accenture Software combines deep technology acumen with industry knowledge to develop differentiated software products. It offers innovative software-based solutions to enable organizations to meet their business goals and achieve high performance. Its home page is www.accenture.com/software. The homepage for Accenture Freight and Logistics Software is www.accenture.com/AFLS.

Article source: http://finance.yahoo.com/news/accenture-updates-freight-logistics-software-110000103.html

Air cargo demand stagnates

Air cargo demand has not grown in recent months, according to the International Air Transport Association

Global airfreight markets in April saw demand (measured in freight tonne kilometers) up 3.2 above above previous year levels. But traffic levels in April were slightly below those of January and 1.1 percent lower than what was recorded in March.

“Trading conditions for airfreight are difficult. Overall, business activity and trade have shifted down a gear after a strong end to 2013. And this is taking its toll on growth in the air cargo sector. Developed economies are still maintaining post-recession momentum, and the expectation is for a stronger finish to the year,” Tony Tyler, IATA’s director general and CEO, said.

Story continued after graph.

Latest data show that prior improvements in the demand environment are experiencing some reversal. Largely as a result of further slowdown in the emerging markets, mostly China, indicators of business confidence slipped further in April. Levels still point toward growth, but at the weakest pace for the past five months.

World trade growth has also slowed over recent months. However, momentum in advanced economies remains intact, and export orders still point to expansion. This suggests that current sluggishness in the demand drivers is likely temporary.

The air cargo sector is committed to improving its attractiveness to shippers through efficiency. The goal is to reduce shipping times by 48 hours before 2020. A centerpiece of this effort is the E-freight initiative.

“Air cargo’s sales proposition is speed, and cumbersome processes are holding us back. In March, we reached a significant milestone. For the first time, the e-air waybill was used for over 200,000 shipments. That’s good news, but we still have a long way to go,” Tyler said. 

  • Asia-Pacific carriers saw cargo demand grow by 5.2 percent. The strength of this performance is exaggerated by a comparison to a particularly weak April 2013. Ongoing weakness in Chinese manufacturing activity is likely to affect on air cargo demand in coming months, and export volumes in emerging Asian markets have been in continuous decline throughout 2014. Capacity rose 7.8 percent.
  • European airlines saw demand for air cargo fall by 0.7 percent as trade activity leveled off. GDP growth in the Eurozone was just 0.2 percent in the first quarter. However, indicators look positive for a stronger second quarter. Capacity was up just 0.2 percent.

  • North American carriers posted growth in demand of 2.6 percent. The latest data show a rebound in trade volumes to and from the U.S., and underlying growth trends in business activity are positive. This could boost airfreight growth in future months. Capacity was down 0.8 percent.  

  • Middle Eastern carriers reported that air cargo demand expanded 8.7 percent. This is slightly slower growth compared to previous months, but still easily the strongest growth of any region. Carriers are benefitting from the upswing in developed economies, and increased volumes from emerging markets in Asia and Africa. Capacity was up 8.1 percent.  

  • Latin American airlines suffered a fall in cargo demand of 6.5 percent. Trade volumes in the region have slowed in recent months, reflecting a wider ongoing emerging market malaise. Capacity fell by 0.5 percent.   

  • African airlines saw air cargo demand grow by 2.9 percent. Further growth was held back by weakness in key economies in the region, such as South Africa. Capacity rose by only 1.1 percent.

Article source: http://www.aircargoworld.com/Air-Cargo-World-News/2014/05/air-cargo-demand-stagnates/6526

Air cargo complex fails to attract entrepreneurs

Hardly 40 tonnes of cargo exported against 250 tonnes capacity

Even after an year of the air cargo complex at Mangalore International Airport (MIA) commencing its operation, the facility has failed to attract the entrepreneurs and as a result, the MIA has not been able to recover the operating cost, let alone gaining profit.

The Air Cargo Complex which was built owing to the demand of the entrepreneurs and local business organisations, was expected to boost the export scenario in Dakshina Kannada and neighbouring districts. Though the air cargo was officially inaugurated in March 2013, it began operating on May 1, 2013. However, the transportation of the consignments resumed only in September, after the monsoon receded. Nine months have passed, yet the MIA has not seen an upsurge in handling the export cargo. 

250 tonnes of capacity

The air cargo, having the capacity to handle 250 tonnes of export cargo per month, is at present handling less than 40 tonnes of export cargo and 20 tonnes of import cargo. The cargo handled in Mangalore Airport largely comprises of fruits and vegetables which are exported to West Asia. 

A small quantity of fish and spare parts too is exported in the aircraft. But, the lukewarm response from the entrepreneurs has become a matter of concern to the Airport authority and to the Kanara Chamber of Commerce and Industry (KCCI), which had demanded for air cargo facility in MIA.   

Analysing the reasons for lack of response, KCCI President Mohammad Ameen said that issues related to paying customs duty is one of the factors affecting the cargo. “It is not that entrepreneurs are not interested to export through air cargo, but that they are facing certain obstacles in the process.

With no system in place to remit the customs duty at the Mangalore Airport, the agents are forced to go to the Customs House at Panambur to pay the charges, much to their inconvenience. Issues in giving license for sea food export too has become an hindrance,” he told Deccan Herald.

The limited capacity of the flights to handle cargo is another factor affecting the process. At times when the entrepreneurs are ready with the cargo to export, the passenger flights lack space to carry the goods. 

The flights need to allocate more space to carry the cargo, he said, hoping for cooperation from all the departments concerned to draw the exporters.

Feeder arrangement

Mangalore International Airport Director J T Radhakrishna too admitted that cargo handling has not been upto the mark. 

“We were expecting to handle at least 200 tonnes of cargo in the airport, but the response from exporters has not been encouraging and we are unable to recover the running charges. On an average, five flights fly from MIA to West Asia everyday and each flight can at the maximum accommodate cargo upto 1.5 tonnes. 

At present, only Jet Airways has made arrangements to transport the cargo and talks are on with Air India on the same,” J T Radhakrishna      said.

The Airport Director urged the entrepreneurs to explore new avenues and export the goods in demand to USA and Europe through feeder arrangement. The exporters should tie-up with agencies in Gulf airlines and transport their goods to European countries.

On introducing exclusive cargo aircraft in MIA, he said that could be made possible only if the KCCI assures of arranging 40 to 60 tonnes of cargo every week.

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Article source: http://www.deccanherald.com/content/409398/air-cargo-complex-fails-attract.html

Amerijet adds domestic air cargo flights

Fort Lauderdale‘s Amerijet International, long known for its overseas cargo business, is starting up domestic flights.

Amerijet is investing several million dollars to open hubs at airports in Columbus, Ohio and Reno, Nev. It will fly a 767 freighter between the hubs starting in July and will link cargo on those flights with Amerijet’s affiliated U.S. trucking service.

“We’re putting in a hybrid network of planes and trucks to allow us to move freight coast-to-coast and up the coasts,” said Pam Rollins, Amerijet’s senior vice president for business development.

“As the economy recovers and more manufacturing moves back into the U.S., there is demand” for more domestic air-cargo service, Rollins said. Many air-cargo services have disappeared after 2001, as the industry was hit by recessions, fuel-price hikes and added security regulations.

Amerijet said it plans to hire 35 people for its new hubs, adding to the nearly 700 people the airline already employs worldwide, Rollins said.

Cargo from the expanded U.S. network will feed cargo into Amerijet’s hub in Miami, which offers flights to Latin America, the Caribbean and beyond.

Started by entrepreneur Dave Bassett in 1974 as an air-taxi service, Amerijet has grown over the decades to offer not only air-cargo flights but also land and sea transport. Together, its varied operations produced more than $200 million in revenue last year and employ more than 800 people doing business in 86 nations, said Rollins.

dhemlock@sunsentinel.com, 305-323-7750, @dhemlock on Twitter

.

Article source: http://sunsentinel.feedsportal.com/c/34258/f/623244/s/3aae733b/sc/10/l/0L0Ssun0Esentinel0N0Cbusiness0Cfl0Eamerijet0Eexpansion0E20A140A520A0H0A0H38380A360Bstory0Dtrack0Frss/story01.htm

ATSG Reports First Quarter 2014 Financial Results

WILMINGTON, Ohio–(BUSINESS WIRE)–

Air Transport Services Group, Inc. (ATSG), the leading provider
of medium wide-body aircraft leasing, and air cargo transportation and
related services, today reported consolidated financial results for the
quarter ended March 31, 2014, and announced new, multi-year dry-leases
of Boeing 767 freighter aircraft and an amendment to its credit
agreement with a consortium of banks.

For the first quarter of 2014:

  • Revenues were $143.6 million, flat with a year ago. Increases in
    revenues from aircraft leasing and other business activities offset
    lower revenues from airline operations.
  • Earnings from continuing operations of $6.5 million, or $0.10 per
    share, were lower than earnings of $8.5 million, or $0.13 per share a
    year ago. A $4.1 million increase in depreciation and amortization
    expense stemming from the addition of more modern aircraft to ATSG’s
    fleet, offset decreases in other operating expenses.
  • Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and
    Amortization, also adjusted for the effect of derivative transactions)
    was $38.8 million, up 4 percent from $37.3 million in the prior-year
    quarter. Adjusted EBITDA is a non-GAAP financial measure, defined and
    reconciled to comparable GAAP results in separate tables at the end of
    this release.
  • Today, ATSG executed a favorable amendment to its primary credit
    agreement which extends the term of the agreement until May 6, 2019,
    reduces interest rate pricing, adds a $50 million accordion feature,
    and improves its ability to execute stock repurchases and pay
    dividends to shareholders.

Separately, ATSG announced the following new-business agreements today:

  • Dry-leases for two Boeing 767-200 freighters to Cargojet, a Canadian
    airline, for terms of up to three years beginning in the second and
    third quarters this year. These aircraft are in addition to the two
    767-200 freighters Cargojet currently leases from CAM.
  • Dry-leases for two Boeing 767-300 freighters to Amerijet, a Florida
    based airline, under six-year terms beginning in the third quarter
    this year. Amerijet currently leases three 767-200 freighters from CAM.

Joe Hete, President and Chief Executive Officer of ATSG, said, “This new
business with two long-standing ATSG customers demonstrates their
confidence in the value of mid-size freighters as vital components of
efficient regional air-cargo networks, and in our bundled services
offerings, which facilitate rapid implementation and scale efficiencies.
These dry lease deployments evidence the strengthening demand for
mid-size lift that we spoke of last quarter, and bolster our confidence
that we can deliver at or above the upper range of our EBITDA guidance
for 2014, based on improving performance, particularly in the second
half of the year.”


Segment Results
CAM (Aircraft Leasing)

Significant Developments:

  • Higher revenues were the result of four more CAM-owned aircraft in- or
    available for service as of March 31, including four 757 combis
    (combined passenger and main-deck cargo aircraft), two 767 freighters
    and one 757 freighter, less three retired DC-8 combis. Lower pre-tax
    earnings from leasing operations reflect higher depreciation on the
    newer added aircraft.
  • At March 31, CAM owned 51 Boeing cargo aircraft in service condition
    including 20 leased to external customers and 30 leased to CAM’s
    airline affiliates, and one unassigned. A table reflecting cargo
    aircraft in service is included at the end of this release.
  • CAM’s seventh owned 767-300 freighter became available for service
    during the first quarter, along with its fourth 757 combi. ATSG no
    longer has any aircraft in modification or awaiting conversion.
  • In addition to the two 767-300s that Amerijet has agreed to lease from
    CAM, it also agreed to 18-month lease extensions through 2019 for two
    of the three 767-200s it currently leases, and the right to terminate
    early the dry lease of the third leased 767-200 when the 767-300s are
    fully deployed. One of CAM’s airline affiliates is operating one
    767-200 freighter in Amerijet’s network under an interim ACMI
    agreement.
  • When fully implemented later this year, the new arrangements with
    Amerijet and Cargojet will increase the number of CAM aircraft leased
    to external customers from 20 at March 31 to 23, principally via
    reductions in the number of aircraft leased to its airline affiliates.


ACMI Services

Significant Developments:

  • First-quarter airline services revenues decreased $7.4 million to
    $87.5 million, compared with the first quarter last year. Segment
    pre-tax loss increased to $7.0 million from $5.4 million. Reductions
    in non-U.S. operations, including those for DHL in the Mideast, along
    with continued carrying costs associated with underutilized aircraft,
    were principal factors. Revenues from domestic airline operations for
    DHL increased.
  • In the first quarter, the last of four 757 combis entered service for
    the U.S. military, completing the modernization of that fleet. The 757
    combis have more passenger capacity and greater fuel efficiency than
    the DC-8 combis they replaced.
  • During the first quarter, DHL ended ACMI agreements with Air Transport
    International (ATI) for three 767 freighters that had supported DHL’s
    Mideast network. Results from three other freighters deployed by
    ATSG’s airlines offset a portion of the loss of the Mideast business.
  • ACMI block hours decreased 3 percent during the first quarter,
    compared to the prior-year period.
  • As noted above, CAM’s additional placements of freighter aircraft
    under dry leases to third parties will reduce the number of aircraft
    leased to ATSG’s airlines, including three of five underutilized
    freighters leased to those airlines as of March 31.


Other Activities

  • Pre-tax earnings in the first quarter were driven by higher revenues
    from the Company’s aircraft maintenance and postal operations. The
    aircraft maintenance business, Aircraft Maintenance and Engineering
    Services (AMES) is preparing to serve more third-party customers after
    its new hangar opens in Wilmington in June of this year.


Credit Agreement Amendment
Today, ATSG executed an amendment
to its senior secured credit facility which includes a term loan of
$127.5 million, and access to a revolving credit facility of up to $275
million, of which the Company has drawn $188.0 million. Key features of
the amendment include:

  • Extended the maturity of the term loan and revolving credit facility
    from July 2017 to May 6, 2019.
  • Reduced EBITDA-based pricing by approximately 25 basis points.
  • An accordion feature which would allow ATSG to expand the revolver
    capacity from $275 million to $325 million, subject to lenders’
    consent.
  • Allows for stock buybacks and dividends when the debt-to-EBITDA ratio
    is below 2.5 times after giving effect of the buyback or dividend (the
    previous requirement was under 2.0 times).

Outlook
In March, ATSG projected that its Adjusted EBITDA
for 2014 would be in a range of $165 to $170 million, excluding any
results from deployments of under-utilized aircraft. Based on today’s
new-business announcements, virtually all of which commence in the
second half of the year, ATSG has greater confidence that its Adjusted
EBITDA for 2014 from all sources will meet or exceed the upper end of
that guidance range, assuming improving base-business progress in 2014.

Hete said, “Uncertainties that discouraged major investments in
air-cargo networks for many months appear to have eased, and we are
seeing broad interest in our aircraft beyond the agreements we have
announced today. Cargojet and Amerijet have signed for four of our six
under-utilized freighters, and discussions with others give us a good
chance to be fully deployed by the end of this year.

“The growing EBITDA we project, and reductions in our obligations for
capital expenditures and pension funding, will significantly improve our
cash flow this year. Our recent success at placing additional aircraft
under multi-year customer arrangements, and continued interest in those
still available for deployment, gives us confidence that we will make
even greater cash flow gains as the year progresses. With a strong
balance sheet and cash flow, we are poised to invest where it can
generate the most attractive shareholder returns.”

Conference Call
ATSG will host a conference call on May 7,
2014, at 9:00 a.m. Eastern time to review its financial results for the
first quarter of 2014. Participants should dial 888-895-5479 and
international participants should dial 847-619-6250 ten minutes before
the scheduled start of the call and ask for conference pass code 37157156.
The call will also be webcast live (listen-only mode) via www.atsginc.com
and www.earnings.com
for individual investors, and via www.streetevents.com
for institutional investors.

A replay of the conference call will be available by phone on May 7,
2014, beginning at 2:00 p.m. and continuing through March 14, 2014, at
(888) 843-7419 (international callers 630-652-3042); use pass code 37157156#.
The webcast replay will remain available via www.atsginc.com
and www.earnings.com
for 30 days.

About ATSG
ATSG is a leading provider of aircraft leasing
and air cargo transportation and related services to domestic and
foreign air carriers and other companies that outsource their air cargo
lift requirements. ATSG, through its leasing and airline subsidiaries,
is the world’s largest owner and operator of converted Boeing 767
freighter aircraft. Through its principal subsidiaries, including two
airlines with separate and distinct U.S. FAA Part 121 Air Carrier
certificates, ATSG provides aircraft leasing, air cargo lift, aircraft
maintenance services and airport ground services. ATSG’s subsidiaries
include ABX Air, Inc.; Airborne Global Solutions, Inc.; Air Transport
International, Inc.; Cargo Aircraft Management, Inc.; and Airborne
Maintenance and Engineering Services, Inc. For more information, please
see www.atsginc.com.

Except for historical information contained herein, the matters
discussed in this release contain forward-looking statements that
involve risks and uncertainties. There are a number of important factors
that could cause Air Transport Services Group’s (“ATSG’s”) actual
results to differ materially from those indicated by such
forward-looking statements. These factors include, but are not limited
to, changes in market demand for our assets and services, the number and
timing of deployments of our aircraft, our operating airlines’ ability
to maintain on-time service and control costs, and other factors that
are contained from time to time in ATSG’s filings with the U.S.
Securities and Exchange Commission, including its Annual Report on Form
10-K and Quarterly Reports on Form 10-Q. Readers should carefully review
this release and should not place undue reliance on ATSG’s
forward-looking statements. These forward-looking statements were based
on information, plans and estimates as of the date of this release. ATSG
undertakes no obligation to update any forward-looking statements to
reflect changes in underlying assumptions or factors, new information,
future events or other changes.

 

 

 

 

 

AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(In thousands, except per share data)

 

Three Months Ended

March 31,

2014

 

 

2013

REVENUES

$

143,593

$

143,279

 

OPERATING EXPENSES

Salaries, wages and benefits

43,065

43,309

Fuel

12,260

14,361

Maintenance, materials and repairs

24,879

22,134

Depreciation and amortization

24,979

20,920

Rent

7,310

6,779

Travel

4,573

4,727

Landing and ramp

2,738

4,065

Insurance

1,205

1,511

Other operating expenses

8,748

 

9,060

 

129,757

126,866

 

 

 

 

OPERATING INCOME

13,836

16,413

OTHER INCOME (EXPENSE)

Interest income

19

21

Interest expense

(3,823

)

(3,132

)

Net gain on derivative instruments

299

 

290

 

(3,505

)

(2,821

)

 

 

 

 

EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES

10,331

13,592

INCOME TAX EXPENSE

(3,809

)

(5,091

)

 

 

 

 

EARNINGS FROM CONTINUING OPERATIONS

6,522

8,501

 

EARNINGS (LOSS) FROM DISCONTINUED OPERATIONS, NET OF TAX

211

 

(1

)

NET EARNINGS

$

6,733

 

$

8,500

 

 

EARNINGS PER SHARE – Basic

Continuing operations

$

0.10

 

$

0.13

 

Discontinued operations

 

 

NET EARNINGS PER SHARE

$

0.10

 

$

0.13

 

 

EARNINGS PER SHARE – Diluted

Continuing operations

$

0.10

 

$

0.13

 

Discontinued operations

 

 

NET EARNINGS PER SHARE

$

0.10

 

$

0.13

 

 

WEIGHTED AVERAGE SHARES

Basic

64,148

 

63,810

 

Diluted

65,141

 

64,524

 

 

 

 

 

 

 

 

 

AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

 

March 31,

December 31,

2014

2013

ASSETS

CURRENT ASSETS:

Cash and cash equivalents

$

27,102

$

31,699

Accounts receivable, net of allowance of $698 in 2014 and $717 in
2013

50,827

52,247

Inventory

10,608

9,050

Prepaid supplies and other

12,754

9,730

Deferred income taxes

13,957

13,957

Aircraft and engines held for sale

2,487

 

2,995

 

TOTAL CURRENT ASSETS

117,735

119,678

 

Property and equipment, net

817,441

838,172

Other assets

36,761

21,143

Pension assets, net of obligations

16,887

14,855

Intangibles

4,826

4,896

Goodwill

34,395

 

34,395

 

TOTAL ASSETS

$

1,028,045

 

$

1,033,139

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES:

Accounts payable

$

30,361

$

34,818

Accrued salaries, wages and benefits

23,400

23,163

Accrued expenses

9,497

9,695

Current portion of debt obligations

23,873

23,721

Unearned revenue

8,887

 

8,733

 

TOTAL CURRENT LIABILITIES

96,018

100,130

 

Long term debt

350,718

360,794

Post-retirement obligations

30,207

30,638

Other liabilities

62,243

62,740

Deferred income taxes

113,273

109,869

 

STOCKHOLDERS’ EQUITY:

Preferred stock, 20,000,000 shares authorized, including 75,000
Series A Junior Participating Preferred Stock

Common stock, par value $0.01 per share; 75,000,000 shares
authorized; 64,850,537 and 64,618,305 shares issued and outstanding
in 2014 and 2013, respectively

649

646

Additional paid-in capital

525,347

524,953

Accumulated deficit

(120,080

)

(126,813

)

Accumulated other comprehensive loss

(30,330

)

(29,818

)

TOTAL STOCKHOLDERS’ EQUITY

375,586

 

368,968

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

$

1,028,045

 

$

1,033,139

 

 

 

 

AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES

PRE-TAX EARNINGS AND ADJUSTED PRE-TAX EARNINGS SUMMARY

FROM CONTINUING OPERATIONS

NON-GAAP RECONCILIATION

(In thousands)

 

 

 

 

Three Months Ended

March 31,

2014

 

 

2013

Revenues

CAM

$

40,635

$

38,969

ACMI Services

Airline services

87,507

94,892

Reimbursables

21,089

 

18,159

 

Total ACMI Services

108,596

113,051

Other Activities

26,808

 

26,254

 

Total Revenues

176,039

178,274

Eliminate internal revenues

(32,446

)

(34,995

)

Customer Revenues

$

143,593

 

$

143,279

 

 

Pre-tax Earnings from Continuing Operations

CAM, inclusive of interest expense

14,440

16,873

ACMI Services

(7,046

)

(5,404

)

Other Activities

3,017

2,181

Net, unallocated interest expense

(379

)

(348

)

Net gain on derivative instruments

299

 

290

 

Total Pre-tax Earnings

$

10,331

$

13,592

 

Adjustments to Pre-tax Earnings

Less net gain on derivative instruments

(299

)

(290

)

Adjusted Pre-tax Earnings

$

10,032

 

$

13,302

 

 

Adjusted Pre-tax Earnings is defined as Earnings from Continuing
Operations Before Income Taxes less derivative gains. Management uses
Adjusted Pre-tax Earnings from Continuing Operations to assess the
performance of its operating results among periods. Adjusted Pre-tax
earnings from Continuing Operations is a non-GAAP financial measure and
should not be considered an alternative to Earnings from Continuing
Operations Before Income Taxes or any other performance measure derived
in accordance with GAAP.

 

 

AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES

UNAUDITED ADJUSTED EARNINGS FROM CONTINUING OPERATIONS BEFORE
INTEREST, TAXES, DEPRECIATION AND AMORTIZATION

NON-GAAP RECONCILIATION

(In thousands)

 

 

 

 

Three Months Ended

March 31,

2014

 

 

2013

 

Earnings from Continuing Operations Before Income Taxes

$

10,331

$

13,592

Interest Income

(19

)

(21

)

Interest Expense

3,823

3,132

Depreciation and Amortization

24,979

 

20,920

 

EBITDA from Continuing Operations

$

39,114

$

37,623

Less net gain on derivative instruments

(299

)

(290

)

 

 

 

 

Adjusted EBITDA from Continuing Operations

$

38,815

 

$

37,333

 

 

EBITDA and Adjusted EBITDA from Continuing Operations are non-GAAP
financial measures and should not be considered as alternatives to
Earnings from Continuing Operations Before Income Taxes or any other
performance measure derived in accordance with GAAP.

EBITDA from Continuing Operations is defined as Earnings from Continuing
Operations Before Income Taxes plus net interest expense, depreciation,
and amortization expense. Adjusted EBITDA from Continuing Operations is
defined as EBITDA from Continuing Operations less derivative gains.

Management uses EBITDA from Continuing Operations as an indicator of the
cash-generating performance of the operations of the Company. Management
uses Adjusted EBITDA from Continuing Operations to assess the
performance of its operating results among periods. EBITDA and Adjusted
EBITDA from Continuing Operations should not be considered in isolation
or as a substitute for analysis of the Company’s results as reported
under GAAP, or as an alternative measure of liquidity.

 

 

AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES

IN-SERVICE CARGO AIRCRAFT FLEET

 

Aircraft Types

 

 

 

 

December 31,

 

 

March 31,

 

 

December 31,

2013

2014

2014 Projected

 

 

Operating

 

 

Operating

 

 

Operating

Total

Owned

Lease

Total

Owned

Lease

Total

Owned

Lease

B767-200

40

36

4

40

36

4

40

36

4

B767-300

8

6

2

9

7

2

9

7

2

B757-200

4

4

4

4

4

4

B757 Combi

3

3

4

4

4

4

Total Aircraft In-Service

55

49

6

57

51

6

57

51

6

 

Owned Aircraft In Serviceable Condition

December 31,

March 31,

December 31,

2013

2014

2014 Projected

 

ATSG airlines

29

30

24-28

External customers

20

20

23-27

Unassigned

1

49

51

 

Article source: http://finance.yahoo.com/news/atsg-reports-first-quarter-2014-213400502.html