WILMINGTON — Air Transport Services Group, Inc. reported Thursday consolidated financial results for the quarter ended Dec. 31, 2021 with revenues at $482.4 million, up 21%, and full-year revenues revenues of $1.73 billion, up 10% over the prior year.
Rich Corrado, president and chief executive officer of ATSG, said, “Our 2021 results demonstrate the powerful combination of having the right solutions for our customers, the right strategy for deploying our in-demand assets, and the right people to operate and support them. These results flow from investing to extend our lead as the largest lessor of freighter aircraft, and from delivering best-in-class air express service for the e-commerce customers who demand it.
“I am extremely proud of our people as they lay the foundation for even more exceptional results over the next several years. As we look to the immediate future in 2022, we expect even higher achievements, with our outlook for almost $100 million in additional Adjusted EBITDA over our record 2021 results.”
2021 highlights
• A record 15 additional customer leases of Boeing 767-300 freighters, plus three re-leases of Boeing 767-200s. Eleven of the 15 767-300 freighters are also being operated by ATSG’s airlines. Additionally, four more customer-provided 767 freighters were assigned to our airlines to operate on their behalf.
• FAA certification of our joint-venture’s design for passenger-to-freighter modification of Airbus A321-200 aircraft, and the conversion and delivery of our joint-venture’s first such freighter. CAM will add its first A321-200 freighter to its leased freighter fleet in late 2022.
• Commitment to convert twenty Airbus A330-300 passenger aircraft to freighters. The first induction will begin in 2023 with deliveries to lessees in 2024 through 2026. Like the 767-300, the A330-300 is well suited to support rapidly expanding regional air-express networks.
• Acquired feedstock aircraft and conversion slots for all of the eleven freighter aircraft CAM expects to lease in 2022 and the majority of those it expects to lease in 2023. (At year end, CAM held 70 passenger-to-freighter conversion slots for induction from 2022 through 2025, including 35 Boeing 767-300s, 20 Airbus A330-300s, and fifteen A321-200s.)
• Growing passenger air operations for the military and commercial customers, including Omni Air’s key role in America’s rescue of Afghanistan evacuees during the third quarter, and a stronger than anticipated recovery in ad-hoc commercial charter flying in the fourth quarter.
• 2021 negotiations with DHL led to February 2022 agreements to extend and expand our 18-year commercial relationship, including six-year extensions of the operating agreement and five freighter leases.
On to 2022
The strong operating momentum in ATSG’s freighter leasing and airline businesses, together with the change in engine maintenance services for ATSG’s 767-200s, will drive substantial increases in 2022 adjusted earnings as well as Adjusted EBITDA.
Corrado noted that demand for express-package air transport reached record levels throughout the fourth-quarter holiday season, in part due to exceptional e-commerce demand and continuing constraints on other transport modes.
“Our customers tell us that they appreciate ATSG’s ability to sustain high levels of on-time performance despite adverse weather and pandemic conditions, including our ability to provide additional airlift on short notice when crew shortages or aircraft issues sideline other operators.”
ATSG has reserved significant passenger-to-freighter conversion capacity for Boeing 767 and Airbus A330 aircraft over the next several years, assuring its continued leadership in that steadily expanding midsize widebody space. Together with its investment in narrow-body A321 conversions best suited for smaller-volume express package and e-commerce destinations, ATSG expects to be a principal source of dedicated freighters for regional and trans-Atlantic airlift to express-package delivery networks anywhere in the world.
Corrado concluded, “We have customer commitments to lease all nine of the Boeing 767s we will deploy in 2022 and the majority of those we expect to lease in 2023. In addition, we already hold lease deposits for more than half of the A330 aircraft we intend to begin deploying in 2024,” he said.
“We have also purchased or hold options to acquire more than half of the feedstock aircraft we will need to meet those commitments. I am very bullish that the strong demand and operating excellence of ATSG will persist and generate even stronger returns in the years to come.”
