Atlas Air reports full year results while Panalpina ends one 747-8F deal

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Atlas Air has announced its full-year and fourth-quarter earnings. While adjusted net income for the fourth quarter fell from $41.8m in 2013 to $38.8m, and for the full year fell from $96.8m to $93.5m, the carrier said it had undergone heavy maintenance expenses on its 747-400Fs, which had offset an increase in aircraft utilisation.

Perhaps more interesting though is a change in deal terms with Panalpina, which had been wet-leasing two 747-8Fs on multi-year leases. From next month, however, one of the forwarder’s 747-8Fs will instead be operated on behalf of DHL Express, to replace a 747-400. And Atlas Air has “entered into a long-term 747-400 charter agreement with Panalpina” – meaning it now has only one ACMI deal with the Swiss company. Panalpina itself, which began the 747-8F operations in 2012, acknowledged that, in the initial stages at least during poor market conditions, the freighters had been hard to fill. “The economics of the 747-8F work really well – but only when they are full….We simply need to generate more business,” Lucas Kuehner, head of air freight for Panalpina said in March 2013.

Meanwhile Atlas, as ever, was bullish. Noting that block hours would grow several percentage points this year, despite “limited visibility” for the second half, president and CEO Bill Flynn said: “2014 ended on a strong note, continuing the improvement we saw throughout the year, and 2015 is starting out well.”