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Here comes the interim update of Atlas Air, which released Q2 20 numbers before the US markets opened today. The headline figures, unexpectedly, looked strong. Yet even better were underlying operating/investing/financing cash flows dynamics, and… “others”.

Top performer!

This chart should be self-explanatory:

(Source Yahoo Finance. Atlas vs DSV, the top FF performer thanks to air)

(Source Yahoo Finance. Atlas vs DSV, the top FF performer thanks to air)

The spin below (PR).


Results Reflect Strong Airfreight Demand and Resilient Business Model

Reported Net Income of $78.9 Million

Adjusted EBITDA of $247.0 Million and Adjusted Net Income of $123.2 Million

Expecting Third-Quarter and Full-Year 2020 Earnings Growth

PURCHASE, N.Y., August 6, 2020 – Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW) today announced second-quarter 2020 net income of $78.9 million, or $3.01 per diluted share, compared with net income of $86.9 million, or $1.61 per diluted share, in the second quarter of 2019.

On an adjusted basis, EBITDA totaled $247.0 million in the second quarter this year compared with $84.1 million in the second quarter of 2019. Adjusted net income in the second quarter of 2020 totaled $123.2 million, or $4.71 per diluted share, compared with $4.5 million, or $0.17 per diluted share, in the second quarter of 2019.

“Revenue and earnings in the second quarter continued to exceed our expectations,” said Chief Executive Officer John W. Dietrich. “These positive results were primarily driven by the team capitalizing on strong demand and higher yields in our commercial charter and South America businesses. We also continued to provide the U.S. military with essential services and our ACMI customers flew well above their minimum guarantees.

“We continued to execute on very favorable business opportunities in a challenging operating environment, with the safety of our employees as our top priority. We leveraged the scale of our world-class fleet, the scope of our global operations and the flexibility of our business model to capitalize on market dynamics.

“To serve this increased demand, we reactivated three of our 747-400 converted freighters and operationalized a 777 freighter from our Dry Leasing business. This enabled us to serve the strong and profitable shorter-term demand, while also entering into numerous new long-term charter programs at attractive yields. We expanded our long-term charter business to include new agreements with manufacturers such as HP Inc., and large freight forwarders like DHL Global Forwarding, APEX Logistics, DB Schenker, Flexport and Geodis, all that wanted to secure committed capacity from us.”

Mr. Dietrich added: “We continued to deliver safe and high-quality service for our customers, despite the many challenges presented by this pandemic, including a variety of travel restrictions, testing protocols, quarantine mandates and other operational challenges. This is a true testament to the commitment and dedication of all our Atlas team members, particularly our crew and ground staff out in the field.”

To read the full release, please click here.

You may also want to read this for background: “Atlas Air Worldwide EPS beats by $2.50, beats on revenue“.

Still, more financial details about its performance so far this year to the end of Q2 ’20 are contained in the Form 8-K & Form 10-K here; earnings call slides here.

Reaction: Atlas Air (AAWW) stock up 1.5% in early trade Thursday versus ATSG‘s +2.8%. Then before midday, AAWW added a couple of % points to its performance while ATSG traded in line with its previous close (+0.5%). Latest @ 12:45 pm (EST): AAWW -2.6%, ATSG -4.4%, with all main indexes unchanged. Latest @ 2:50 pm (EST): AAWW -6%, ATSG -3.9%, while the S&P 500, DJIA and Nasdaq were all up well over +0.5%. AAWW closed at $56.15, -2.78%, with ATSG down 3.7% to $25.28 for the day. The S&P 500, DJIA and Nasdaq rose, respectively, 0.64%, 0.68% and 1%.

Snapshot: 1H ’20 earnings nearly doubled; operating cash flow was 5x higher than in 1H ’19; and cash outflows from investment came in at about one-third of 1H ’19…

(Source Atlas Air)

(Source Atlas Air)

…. while debt proceeds rose to $321m from $20m in 1H ’19 (with net leverage developments shown in the table below)…

(Source Atlas Air)

(Source Atlas Air)

… then read this (“others”): “At June 30, 2020, our cash and cash equivalents, restricted cash and short-term investments totaled $739.2 million, compared with $114.3 million at December 31, 2019. Our improved cash balance primarily reflected strong cash provided by operating activities, and also included the funds we received through the Payroll Support Program available to air cargo carriers under the CARES Act.”


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