ATSG reports first-quarter results


News Journal



WILMINGTON — Air Transport Services Group, Inc. reported this week consolidated financial results for the quarter ended March 31.

ATSG’s first quarter 2021 results, as compared with the first quarter of 2020, include:

• Customer revenues down $13.2 million to $376.1 million. First-quarter ACMI Services revenues were down $37.0 million due primarily to reduced operations for passenger and combi services, including fewer special charter operations, versus the early stages of the pandemic last year.

Aircraft leasing revenues from external customers for the quarter increased $14.1 million from 15 new leases of Boeing 767-300 freighters since March 2020, including five in the first quarter this year.

• Capital spending was $125.4 million, down $18.1 million. First-quarter spending included $84.7 million for the acquisition of four Boeing 767-300 passenger aircraft for freighter conversion, and modification costs for others. Spending for required heavy maintenance, and for other equipment including aircraft engines and components, increased $2.6 million compared to a year ago.

Rich Corrado, president and chief executive officer of ATSG, said, “Leased cargo aircraft deliveries remained on a record pace in the first quarter, including four of the eleven additional Boeing 767s we will lease to and fly for Amazon this year. We also received word last week that the FAA has awarded a Supplemental Type Certificate for freighter conversion of Airbus A321-200 passenger aircraft under our joint venture with Precision.

“In March, we were pleased to learn that Amazon intends to express its continued confidence in ATSG by choosing to exercise ATSG warrants it holds to acquire 19.5 percent of our common shares, including a cash equity investment of $132 million that we expect to be completed this week.

Corrado continued, “However, the incremental passenger flying we were awarded to move personnel in the early stages of the pandemic last year has not continued into 2021, and our ongoing combi and passenger flying assignments remain down.

“We continue to receive federal pandemic relief funds allocated to U.S.passenger airlines, which allows us to retain employees who support those operations. We anticipate an improving trend for our airline businesses, especially in the second half.”

• ATSG’s total fleet consisted of 104 aircraft in service at the end of the quarter, eight more than a year ago. Eighty-five were cargo aircraft, four were combis and 15 were passenger aircraft. CAM owned 98 of ATSG’s in-service aircraft.

Four passenger 767s were leased to Omni Air by third parties and two 767 freighters were subleased from a customer.

• Seventy-five 767s owned by CAM (Cargo Aircraft management) were under lease to third parties at the end of the quarter,thirteen more than a year ago and two more than at the end of 2020. Four 767 freighters, three 767-200s and one 767-300, were being staged for re-lease. CAM expects to complete long-term leases for at least sixteen 767-300 freighters to third party customers during 2021, and at least ten more in 2022.

• Nine 767 aircraft were in or awaiting conversion to freighters at the end of March 2021, down three from a year earlier. CAM purchased four 767 passenger aircraft for freighter modification during the quarter, to be completed and deployed in 2021 or 2022. CAM also removed one 767 passenger aircraft from Omni Air’s fleet for conversion and redeployment as a freighter.

• CAM’s pretax segment earnings for the quarter were $21.5 million, up 36 percent from 2020’s first quarter. Depreciation expense increased $3.9 million and allocated interest decreased $1.0 million.

For the entire report of first-quarter results, visit https://bit.ly/3feiutt .

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News Journal