Atlas Air Worldwide Holdings, Inc. (Nasdaq: AAWW), a leading
global provider of outsourced aircraft and aviation operating
services, today announced adjusted net income attributable to
common stockholders of $39.7 million, or $1.50 per diluted share,
for the fourth quarter of 2011, and $108.8 million, or $4.12 per
diluted share, for the full year. Adjusted results for both periods
exclude pre-operating expenses for the introduction of new aircraft
types, including incremental costs incurred as a result of aircraft
delivery delays; a special charge related to the retirement of the
company’s 747-200 fleet; and gains and losses on the disposal of
assets.
On a reported basis, fourth-quarter net income attributable to
common stockholders totaled $33.5 million, or $1.27 per diluted
share. Full-year reported net income attributable to common
stockholders totaled $96.1 million, or $3.64 per diluted share.
“2011 was a year of expanding our business platform and
investing for the future,” said President and Chief Executive
Officer William J. Flynn.
“We performed well by historical standards, but global economic
conditions, delivery delays for our new 747-8 freighters, delays in
the ramp-up of CMI service for Boeing, and the impact of
pre-operating costs for new initiatives all contributed to
lower-than-anticipated earnings.
“We made significant progress on several strategic business
initiatives during 2011 that we expect will drive
earnings-per-share growth of approximately 24% in 2012 compared
with our adjusted 2011 EPS and contribute to significant earnings
momentum in the years beyond.
“We took delivery of our first three 747-8 freighters and placed
those aircraft and the next two scheduled for delivery in long-term
contracts in our core ACMI business. We also developed and secured
extremely attractive Ex-Im Bank-backed financing for the remaining
six 747-8Fs in our order – financing that will provide significant
savings in our ownership cost for these assets.
“In 2011, we developed and implemented a comprehensive AMC
Charter passenger business, and initiated a new 767 passenger- and
cargo-aircraft operating platform. These new businesses complement
our industry-leading 747 freighter services and our asset-light CMI
operations. These investments will further enhance our revenue and
earnings growth in the years ahead.”
Fourth-Quarter and Full-Year Results
Adjusted and reported net income attributable to common
stockholders for the three months ended December 31, 2011 was
achieved on revenues of $388.2 million. Adjusted and reported
pretax earnings for the period totaled $66.0 million and $55.1
million, respectively.
Earnings in the fourth quarter of 2011 were driven by our core,
long-term ACMI business, complemented by increased AMC Charter
demand, including our new military passenger service.
Despite global economic strains that affected the airfreight
market and our business during 2011, performance in our Commercial
Charter business in South America remained strong, and overall
performance in Commercial Charter in the fourth quarter improved
from our third-quarter results, reflecting an increase in demand
and improved block-hour rates.
Results for the fourth quarter of 2011 benefited from
substantially lower maintenance expense and continued productivity
improvement and cost controls. Results for the quarter, however,
were also impacted by further Boeing 747-8F delivery delays and
lower-than-anticipated Boeing Dreamlifter flying, which affected
our CMI operations.
2010 fourth-quarter reported net income attributable to common
stockholders totaled $41.6 million, or $1.58 per diluted share, on
revenues of $359.7 million. Adjusted net income attributable to
common stockholders for the three months ended December 31, 2010,
totaled $41.4 million, or $1.58 per diluted share. Adjusted and
reported pretax earnings in the year-ago period totaled $62.1
million and $62.3 million.
Adjusted and reported net income attributable to common
stockholders for the year ended December 31, 2011, reflected
revenues of $1.40 billion, adjusted pretax earnings of $179.2
million, and reported pretax earnings of $157.0 million. In 2010,
Atlas Air Worldwide’s adjusted and reported net income attributable
to common stockholders totaled $150.4 million and $141.8 million,
or $5.77 and $5.44 per diluted share, respectively, on revenues of
$1.34 billion. Adjusted and reported pretax earnings in 2010 were
$237.5 million and $233.1 million.
After-tax adjustments to earnings in the fourth quarter of 2011
included a special charge of $3.5 million, or $0.13 per diluted
share, for asset impairment and employee termination charges
related to the retirement of our 747-200 fleet, as well as an
expense of $2.6 million, or $0.10 per diluted share, for
pre-operating expenses related to the introduction of new aircraft
types, including incremental costs incurred as a result of aircraft
delivery delays.
After-tax adjustments to earnings for the full year of 2011
included an expense of $9.5 million, or $0.36 per diluted share,
related to the introduction of new aircraft types, including
incremental costs incurred as a result of aircraft delivery delays;
a special charge of $3.5 million, or $0.13 per diluted share, for
asset impairment and employee termination charges related to the
retirement of our 747-200 fleet; and a gain on disposal of aircraft
of $0.2 million, or $0.01 per diluted share.
After-tax adjustments to earnings for the full year of 2010
included a net accrual for legal settlements of $16.1 million, or
$0.62 per diluted share; a benefit of $5.6 million, or $0.21 per
diluted share, for legal settlement received; a gain on disposal of
aircraft of $2.3 million, or $0.09 per diluted share; and an
expense of $0.4 million, or $0.02 per diluted share, related to the
introduction of new aircraft types and incremental costs incurred
as a result of aircraft delivery delays.
Outlook
“We expect to report a significant increase in earnings in 2012,
with reported fully diluted earnings growing approximately 24% from
2011 adjusted EPS, to more than $5.10 per share, on a 17% increase
in block hours,” said Mr. Flynn.
“We expect that market growth during the year will be seasonal
and second-half weighted. We also expect that close to 60% of our
maintenance expense will be incurred in the first-half, with our
AMC 767 passenger operations ramping up in the second quarter, our
next deliveries of 747-8Fs in the second half, and CMI flying for
Boeing and DHL Express increasing as the year progresses. As a
result, we anticipate a sequential increase in our quarterly
earnings throughout the year, starting at a marginal level in the
first quarter and with over 70% occurring in the second half.
“Our new 747-8Fs, which will drive growth and profitability in
our business going forward, have begun to enter service and will be
an important contributor this year. Along with a full year of AMC
Charter passenger service as well as a continuing step-up in CMI
flying for Boeing and DHL Express, we believe these will more than
offset an anticipated reduction in AMC Charter cargo demand in
2012.
Three of the company’s new 747-8F aircraft entered ACMI service
in the fourth quarter of 2011 under a long-term contract with
British Airways. Two additional -8F aircraft, which are expected to
be delivered in the third quarter, are under long-term ACMI
contract with Panalpina. Two other -8F aircraft are expected to be
received and placed into ACMI service in the fourth quarter of
2012.
Based on existing and expected deliveries and placements for the
747-8Fs in 2012, these aircraft are anticipated to generate
approximately 48 months of flying in 2012.
By year-end 2012, the company’s cargo operations are expected to
include seven 747-8Fs, with two additional -8F aircraft to be
delivered in the first half of 2013. The six 747-8Fs to be
delivered are covered by a term-loan facility guaranteed by the
Export-Import Bank of the United States. Terms and rates on the
facility are even more attractive than the very favorable terms on
our first three 747-8F deliveries.
These 747-8F aircraft complement 24 current 747-400 freighters,
16 of which are engaged in ACMI service. We will also have two
passenger 747-400s and three passenger 767-300s providing charter
service to the U.S. military and other customers in 2012.
In addition, we anticipate that we will operate at least 11
customer-owned aircraft in our CMI (crew, maintenance and
insurance) operations. These operations include five 767-200
freighters for DHL Express that we expect to add to our fleet in
the first three quarters of 2012, four 747 Large Cargo Freighters
(Dreamlifters) for Boeing and two 747-400 passenger aircraft for
SonAir.
With the retirement of our five remaining older-generation
747-200 cargo aircraft, we will utilize modern, more efficient
747-400 cargo aircraft to provide continuing service in our AMC and
Commercial Charter operations.
We continue to expect that volumes in our military passenger
business, including our new B767 operations, will grow to 10,000
block hours in 2012 from about 1,300 block hours in 2011 and none
in 2010. At the same time, we anticipate that AMC Charter cargo
volume will total about 10,000 block hours in 2012, reflecting
indications of a likely reduction in demand by the U.S. military in
international areas.
Maintenance expense in 2012 is expected to total approximately
$175 million compared with $168 million in 2011. Line maintenance,
which is based on block hours operated, should account for more
than 50% of these expenditures in 2012. As block hours are expected
to increase over 2011, line maintenance will grow accordingly.
Approximately 40% of maintenance expense should be for heavy
airframe checks and engine overhauls, with the balance for
non-heavy maintenance. From a timing perspective, about one third
of total maintenance expense in 2012 is currently expected to occur
in the first quarter of the year, approximately 25% in each of the
second and third quarters, and the balance in the fourth
quarter.
Mr. Flynn concluded: “Our 747-8F aircraft will drive volumes and
profitability in our core ACMI business, and our growing CMI
operations and passenger military business will complement that
growth.
“We believe that our modern, efficient fleet, business mix and
solid balance sheet will allow us to continue to do well in all
economic conditions and to navigate the growth ahead.
“Given the combination of our innovative customer solutions, our
ability to capitalize on changing market demand, our strategic
growth initiatives, and our effectiveness in executing our business
model, we are very well-positioned to drive our revenues and
earnings to higher sustained levels over the next several years and
beyond.”
Conference Call
Management will host a conference call to discuss Atlas Air
Worldwide’s fourth-quarter and full-year 2011 financial and
operating results at 11:00 a.m. Eastern Time on Wednesday, February
15, 2012.
Interested parties are invited to listen to the call live over
the Internet at www.atlasair.com (click on “Investor Information”,
click on “Presentations” and on the link to the fourth-quarter
call) or at the following Web address:
http://www.media-server.com/m/p/5micpmvb.
For those unable to listen to the live call, a replay will be
available on the above websites following the call. A replay will
also be available through February 22 by dialing (855) 859-2056
(domestic) and (404) 537-3406 (international) and using Access Code
49946706#.
4Q11 Performance versus 4Q10
Operating revenues of $388.2 million in the fourth quarter of
2011 were $28.5 million, or 8%, higher than the year-earlier
period, primarily reflecting increases in volumes and revenue per
block hour in our AMC Charter operations, partially offset by a
reduction in Commercial Charter volumes and revenue per block
hour.
Total block hours increased 3% (36,121 block hours versus
35,029) compared with the fourth quarter of 2010, while average
operating aircraft, excluding Dry Leasing aircraft, increased 12%
(33.0 compared with 29.4). Average utilization of operating
aircraft, excluding Dry Leasing aircraft, totaled approximately
11.9 hours per aircraft per day during the quarter compared with
13.0 in the fourth quarter of 2010.
In ACMI, revenues of $162.6 million increased $2.7 million, or
2%, reflecting an increase in block-hour volumes (26,382 versus
25,952) and comparable average ACMI revenue per block hour rates
($6,164 versus $6,163). The increase in block-hour volumes compared
with the fourth quarter of 2010 was primarily due to the flying of
two incremental aircraft for DHL Express that began in March 2011.
Reflecting the increase in block-hour volumes, ACMI customers flew
4.4% above contractual minimums during the quarter.
For the quarter, an average of 22.1 aircraft (19.1 Boeing
747-400s, 0.8 Boeing 747-8F, 0.5 Boeing 747-200, and 1.7 CMI
aircraft) supported our ACMI operations, compared with an average
of 21.0 aircraft (19.2 Boeing 747-400s, 0.3 Boeing 747-200s, and
1.5 CMI aircraft) in the fourth quarter of 2010.
AMC Charter revenues of $126.5 million increased $40.8 million,
or 48%, in the latest quarter, due to increases in block hours and
revenue per block hour. Block-hour volumes increased 18% (5,121
block hours versus 4,356) compared with the fourth quarter of 2010,
primarily due to 724 block hours for AMC passenger missions, which
we began to fly in the second quarter of 2011. Block-hour rates
increased 26% ($24,701 versus $19,669), reflecting an increase in
the average “pegged” fuel price paid by the U.S. military ($3.97
per gallon versus $2.68) and higher rates paid on 747-400 aircraft
utilized during the quarter.
An average of 6.5 aircraft (2.4 Boeing 747-400s, 2.3 Boeing
747-200s and 1.8 Boeing 747-400 passenger aircraft) supported our
AMC Charter operations during the quarter, compared with an average
of 4.3 aircraft (0.8 Boeing 747-400s and 3.5 Boeing 747-200s) in
the fourth quarter of 2010.
In Commercial Charter, revenues of $92.6 million were $16.3
million, or 15%, lower than the fourth quarter of 2010. Revenues
reflected a reduction in block-hour volumes (4,142 versus 4,540) as
well as block-hour rates ($22,350 versus $23,990). Block-hour
volumes primarily reflected softer demand out of Asia.
For the quarter, an average of 4.4 aircraft (2.5 Boeing 747-400s
and 1.9 Boeing 747-200s) supported our Commercial Charter
operations, compared with an average of 4.1 aircraft (1.9 Boeing
747-400s and 2.2 Boeing 747-200s) in the fourth quarter of
2010.
Operating Expenses
Operating expenses, including the special charge of $5.4 million
in the fourth quarter of 2011, totaled $334.7 million, an increase
of $36.5 million, or 12%, compared with the same quarter in 2010.
The increase in operating expenses was primarily due to increases
in aircraft fuel, labor expense, travel, aircraft rent and other
operating expenses, partially offset by a significant reduction in
maintenance expense.
Aircraft fuel expense of $110.4 million increased $32.5 million,
or 42%, compared with the fourth quarter of 2010. Higher fuel
expense reflected a 48% increase in the AMC Charter pegged fuel
price and a 29% increase in Commercial Charter fuel prices ($3.24
per gallon versus $2.51).
Labor expense of $76.7 million during the quarter increased
$16.2 million, or 27%, primarily due to an increase in wages for
crewmembers as of October 1, 2011, under a new, five-year
collective bargaining agreement; an increase in total block hours
flown; and the hiring of additional employees to support new
aircraft.
Travel expense of $13.7 million increased $3.7 million, or 37%,
primarily due to the impact of higher airfares and increased
block-hour volumes on the cost of international crew travel. In
addition to higher airfares, increased ground-staff travel expense
related to on-boarding new aircraft and maintenance activities
contributed to the increase.
Aircraft rent of $43.1 million during the quarter was $3.6
million, or 9%, higher than in the fourth quarter of 2010 due to
the leasing of additional aircraft and spare engines in 2011.
Other operating expenses totaled $29.3 million during the
quarter, an increase of $5.6 million, or 23%, versus the fourth
quarter of 2010. Other operating expenses in the fourth quarter of
2011 reflected an increase in contract services for flight
attendants and passenger catering, commissions related to increased
AMC Charter revenue, freight related to the movement of 747-200
spare parts and engines to be utilized on aircraft in lieu of
incurring more costly repairs, and increased crew training on new
aircraft types.
Maintenance expense of $23.1 million decreased $35.0 million, or
60%, during the quarter. No heavy airframe checks or engine
overhauls were required to be performed during the period. In
contrast, the fourth quarter of 2010 included one 747-400 D Check,
one 747-200 D Check, and 11 engine overhauls.
Net Interest and Other Non-Operating Expenses
Net interest income totaled $1.9 million during the quarter, an
improvement of $1.2 million compared with the fourth quarter of
2010, primarily reflecting an increase in capitalized interest.
Income Taxes
Fourth-quarter results included an income tax expense of $22.1
million compared with an income tax expense of $19.8 million in the
fourth quarter of 2010, resulting in an effective income tax rate
of 40.1% versus a rate of 31.7%.
Our effective income tax rates differ from the U.S. federal
statutory rate primarily due to the income tax impact of global
operations, U.S. state income taxes, and the nondeductibility of
certain items for tax purposes. The difference between the
effective rate and the statutory rate for the three months ended
December 31, 2011 was primarily due to the income tax impact of
nondeductible items. The difference between the effective rate and
the statutory rate for the three months ended December 31, 2010 was
primarily attributable to a reduction in the effective state income
tax rate.
Cash, Cash Equivalents, and Short-Term Investments
At December 31, 2011, our cash, cash equivalents, and short-term
investments totaled $195.2 million, compared with $595.1 million at
December 31, 2010.
The change in cash, cash equivalents and short-term investments
included cash outflows of $226.0 million related to pre-delivery
payments made to Boeing on our 747-8F order; $172.9 million related
to the acquisition of aircraft and spare engines for our Titan
subsidiary, our AMC Charter passenger operations, and our core
operations; and $46.9 million related to the paydown and closing of
our 2008 pre-delivery payment financing facility. These payments
were partially offset by a total of $40.3 million of net cash
inflows received at closing in connection with the financing of our
first three 747-8F aircraft deliveries.
Outstanding Debt
At December 31, 2011, our balance sheet debt totaled $750.0
million, including the impact of $51.9 million of unamortized
discount.
The face value of our debt at December 31, 2011, totaled $801.9
million, compared with $544.2 million on December 31, 2010. The
increase primarily reflected $360.3 million of new debt used to
finance the acquisition of our first three 747-8Fs, partially
offset by the repayment of outstanding pre-delivery payment
borrowings and the normal amortization of outstanding debt.
Adjusted EBITDAR and EBITDA
EBITDAR, as adjusted for pre-operating expenses, net accrual for
legal settlements, litigation settlements received, special charges
and losses/(gains) on disposal of assets, totaled $119.7 million in
the fourth quarter of 2011 compared with $109.2 million in the
fourth quarter of 2010. For the full year, EBITDAR, as adjusted for
pre-operating expenses, net accrual for legal settlements,
litigation settlements received, special charges and losses/(gains)
on disposal of assets, totaled $376.7 million compared with $421.2
million in 2010.
EBITDA, as adjusted for pre-operating expenses, net accrual for
legal settlements, litigation settlements received, special charges
and losses/(gains) on disposal of assets, totaled $76.6 million in
the latest reporting period compared with $69.7 million in the
fourth quarter of 2010. EBITDA, as adjusted for pre-operating
expenses, net accrual for legal settlements, litigation settlements
received, special charges and losses/(gains) on disposal of assets,
for the full year was $212.7 million compared with $266.6 million
for the prior-year period.
Reconciliation of GAAP to Non-GAAP Financial Measures
To supplement our financial statements presented in accordance
with accounting principles generally accepted in the United States
of America (“GAAP”), we present certain non-GAAP financial measures
to assist in the evaluation of our business performance. These
non-GAAP measures include adjusted EBITDAR and EBITDA; Direct
Contribution; Adjusted Net Income Attributable to Common
Stockholders; Adjusted Diluted EPS and Adjusted Pretax Income,
which exclude certain items that impact year-over-year comparisons
of our results. These non-GAAP measures may not be comparable to
similarly titled measures used by other companies and should not be
considered in isolation or as a substitute for measures of
performance prepared in accordance with GAAP.
We use these non-GAAP financial measures in assessing the
performance of our ongoing operations and in planning and
forecasting future periods. We believe that these adjusted measures
provide meaningful information to assist investors and analysts in
understanding our results and assessing our prospects for future
performance.
About Atlas Air Worldwide:
Atlas Air Worldwide is the parent company of Atlas Air, Inc.
(Atlas) and Titan Aviation Leasing (Titan), and is the majority
shareholder of Polar Air Cargo Worldwide, Inc. (Polar). Atlas Air
Worldwide also maintains a 49% interest in Global Supply Systems
Limited (GSS). Through Atlas and Polar, Atlas Air Worldwide
operates the world’s largest fleet of Boeing 747 freighter
aircraft.
Atlas, Titan and Polar offer a range of outsourced aircraft and
aviation operating services that include ACMI service – in which
customers receive an aircraft, crew, maintenance and insurance on a
long-term basis; CMI service, for customers that provide their own
aircraft; express network and scheduled air cargo service; military
cargo and passenger charters; commercial cargo and passenger
charters; and dry leasing of aircraft and engines.
Atlas Air Worldwide’s press releases, SEC filings and other
information can be accessed through the Company’s home page,
www.atlasair.com.
This release contains “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995
that reflect Atlas Air Worldwide’s current views with respect to
certain current and future events and financial performance. Such
forward-looking statements are and will be, as the case may be,
subject to many risks, uncertainties and factors relating to the
operations and business environments of Atlas Air Worldwide and its
subsidiaries (collectively, the “companies”) that may cause the
actual results of the companies to be materially different from any
future results, express or implied, in such forward-looking
statements.
Factors that could cause actual results to differ materially
from these forward-looking statements include, but are not limited
to, the following: the ability of the companies to operate pursuant
to the terms of their financing facilities; the ability of the
companies to obtain and maintain normal terms with vendors and
service providers; the companies’ ability to maintain contracts
that are critical to their operations; the ability of the companies
to fund and execute their business plan; the ability of the
companies to attract, motivate and/or retain key executives and
associates; the ability of the companies to attract and retain
customers; the continued availability of our wide-body aircraft;
demand for cargo services in the markets in which the companies
operate; economic conditions; the effects of any hostilities or act
of war (in the Middle East or elsewhere) or any terrorist attack;
labor costs and relations; financing costs; the cost and
availability of war risk insurance; our ability to maintain
adequate internal controls over financial reporting; aviation fuel
costs; security-related costs; competitive pressures on pricing
(especially from lower-cost competitors); volatility in the
international currency markets; weather conditions; government
legislation and regulation; consumer perceptions of the companies’
products and services; anticipated and future litigation; and other
risks and uncertainties set forth from time to time in Atlas Air
Worldwide’s reports to the United States Securities and Exchange
Commission.
For additional information, we refer you to the risk factors set
forth under the heading “Risk Factors” in the Annual Report on Form
10-K filed by Atlas Air Worldwide with the Securities and Exchange
Commission on February 14, 2011. Other factors and assumptions not
identified above may also affect the forward-looking statements,
and these other factors and assumptions may also cause actual
results to differ materially from those discussed.
Except as stated in this release, Atlas Air Worldwide is not
providing guidance or estimates regarding its anticipated business
and financial performance for 2012 or thereafter.
Atlas Air Worldwide assumes no obligation to update such
statements contained in this release to reflect actual results,
changes in assumptions or changes in other factors affecting such
estimates other than as required by law.
Atlas Air Worldwide Holdings,
Inc.
Consolidated Statements of
Operations
(in thousands, except per share data)
(Unaudited)
For the Three Months
Ended For the Twelve Months Ended December 31,
2011 December 31, 2010 December 31, 2011
December 31, 2010 Operating Revenue
ACMI $ 162,626 $ 159,936 $ 632,509 $ 543,853 AMC charter 126,495
85,680 442,725 388,994 Commercial charter 92,572 108,915 299,528
384,440 Dry leasing 2,953 1,794 9,695 7,178 Other 3,513
3,369 13,759 13,309 Total Operating Revenue $
388,159 $ 359,694 $ 1,398,216 $ 1,337,774
Operating
Expenses Aircraft fuel 110,391 77,893 388,579 300,229 Salaries,
wages and benefits 76,671 60,492 261,844 238,169 Maintenance,
materials and repairs 23,050 58,062 167,749 174,029 Aircraft rent
43,113 39,549 164,089 154,646 Travel 13,709 9,984 44,037 34,338
Landing fees and other rent 13,303 12,726 50,059 48,700
Depreciation and amortization 12,276 8,304 39,345 34,353 Ground
handling and airport fees 7,324 7,470 24,465 25,115 Loss/(Gain) on
disposal of aircraft 100 (60) (364) (3,601) Special charge 5,441 -
5,441 - Other 29,292 23,733 101,872
103,910 Total Operating Expenses 334,670 298,153
1,247,116 1,109,888 Operating Income 53,489
61,541 151,100 227,886
Non-operating
Expenses / (Income) Interest income (4,993) (5,043) (20,193)
(19,663) Interest expense 12,111 9,638 42,120 40,034 Capitalized
interest (9,052) (5,366) (27,636) (16,373) Other (income) expense,
net 305 13 (180) (9,222) Total
Non-operating Income (1,629) (758) (5,889) (5,224) Income before
income taxes 55,118 62,299 156,989 233,110 Income tax expense
22,085 19,768 60,680 90,154
Net Income 33,033 42,531 96,309 142,956
Less: Net income/(loss) attributable to
noncontrolling interests
(480) 971 226 1,146
Net Income Attributable to Common
Stockholders
$ 33,513 $ 41,560 $ 96,083 $ 141,810
Earnings per
share: Basic $ 1.27 $ 1.60 $ 3.66 $ 5.50 Diluted $ 1.27 $ 1.58
$ 3.64 $ 5.44
Weighted average shares: Basic
26,305 25,914 26,227 25,781 Diluted
26,442 26,234 26,422 26,088
Atlas Air Worldwide Holdings,
Inc.
Direct Contribution
(in thousands)
(Unaudited)
For the Three Months
Ended For the Twelve Months Ended December 31,
2011 December 31, 2010 December 31, 2011
December 31, 2010 Operating Revenue: ACMI $
162,626 $ 159,936 $ 632,509 $ 543,853 AMC Charter 126,495 85,680
442,725 388,994 Commercial Charter 92,572 108,915 299,528 384,440
Dry Leasing 2,953 1,794 9,695 7,178 Other 3,513 3,369
13,759 13,309
Total Operating Revenue $
388,159
$ 359,694
$ 1,398,216
$ 1,337,774
Direct Contribution: ACMI $ 47,051 $ 40,582 $ 148,320 $
127,679 AMC Charter 31,075 15,995 86,962 111,091 Commercial Charter
15,109 33,345 40,200 111,717 Dry Leasing 1,231 952
4,631 4,643
Total Direct Contribution for
Reportable Segments 94,466 90,874 280,113 355,130
Unallocated income and expenses (33,807) (28,635) (118,047)
(125,621) Special charge (5,441) - (5,441) - (Loss)/Gain on sale of
aircraft (100) 60 364 3,601
Income
before Income Taxes 55,118 62,299 156,989
233,110 Interest income (4,993) (5,043) (20,193)
(19,663) Interest expense 12,111 9,638 42,120 40,034 Capitalized
interest (9,052) (5,366) (27,636) (16,373) Other (Income) Expense,
net 305 13 (180) (9,222)
Operating
Income $ 53,489 61,541 151,100
227,886
Atlas Air Worldwide uses an economic performance metric, Direct
Contribution, to show the profitability of each of its segments
after allocation of direct ownership costs. Atlas Air Worldwide
currently has the following reportable segments: ACMI, AMC Charter,
Commercial Charter, and Dry Leasing. Each segment has different
operating and economic characteristics, which are separately
reviewed by senior management.
Direct Contribution consists of income (loss) before taxes,
excluding special charges, pre-operating expenses, nonrecurring
items, gains on the sale of aircraft, and unallocated fixed
costs.
Direct costs include crew costs, maintenance costs, fuel, ground
operations, sales costs, aircraft rent, interest expense related to
aircraft debt and aircraft depreciation.
Unallocated income and expenses include corporate overhead,
non-aircraft depreciation, interest income, foreign exchange gains
and losses, other revenue and other non-operating costs, including
one-time items.
Atlas Air Worldwide Holdings,
Inc.
Reconciliation to Non-GAAP
Measures
(in thousands)
(Unaudited)
For the Three Months
Ended For the Twelve Months Ended
December 31, 2011
December 31, 2010
December 31, 2011
December 31, 2010
Income before income taxes
$
55,118
$ 62,299 $ 156,989 $ 233,110 Pre-operating expenses1 5,298 - 17,130
623
Net accrual for legal settlements
- (132) - 16,068 Litigation settlement received - - - (8,750)
Special charge2 5,441 - 5,441 - Loss/(Gain) on disposal of aircraft
100 (60) (364) (3,601)
Adjusted pretax income 65,957 62,107 179,196 237,450
Interest expense, net (1,934) (771) (5,709) 3,998 Other
non-operating expenses 305 13 (180)
(9,222)
Operating income before pre-operating
expenses, net accrual for legal settlements, litigation settlement
received, special charge and loss/(gain) on disposal of
aircraft
64,328 61,349 173,307 232,226 Depreciation and amortization
12,276 8,304 39,345 34,353
EBITDA, as adjusted3 76,604 69,653 212,652 266,579
Aircraft rent 43,113 39,549 164,089
154,646
EBITDAR, as adjusted4
$
119,717
$ 109,202 $ 376,741 $ 421,225
1 Pre-operating expenses in 2011 and 2010 are related to the
introduction of new aircraft types and include incremental costs
incurred as a result of aircraft delivery delays.
2 Included in Special charge in 2011 are asset impairment and
employee termination charges related to the retirement of the
747-200 fleet.
3 EBITDA, as adjusted: Earnings before interest, taxes,
depreciation, amortization, pre-operating expenses, net accrual for
legal settlements, litigation settlement received, special charge
and loss/(gain) on disposal of assets, as applicable.
4 EBITDAR, as adjusted: Earnings before interest, taxes,
depreciation, amortization, aircraft rent expense, pre-operating
expenses, net accrual for legal settlements, litigation settlement
received, special charge and loss/(gain) on disposal of assets, as
applicable.
Atlas Air Worldwide Holdings,
Inc.
Reconciliation to Non-GAAP
Measures
(in thousands)
(Unaudited)
For the Three Months Ended December
31, 2011 December 31, 2010
Percent Change Net Income Attributable to Common
Stockholders $ 33,513 $ 41,560 (19.4%) After-tax impact from:
Pre-operating expenses1 2,621 -
Net accrual for legal settlements
- (132) Litigation settlement received - - Special charge2 3,466 -
Loss/(Gain) on disposal of aircraft 64 (38)
Adjusted Net Income Attributable to Common Stockholders $
39,664 $ 41,390 (4.2%)
Diluted EPS $ 1.27 $ 1.58
(19.6%) After-tax impact from: Pre-operating expenses1 0.10 -
Net accrual for legal settlements
- - Litigation settlement received - - Special charge2 0.13 -
Loss/(Gain) on disposal of aircraft - -
Adjusted Diluted EPS $ 1.50 $ 1.58 (5.1%)
For the
Twelve Months Ended December 31, 2011 December 31,
2010 Percent Change Net Income Attributable to
Common Stockholders $ 96,083 $ 141,810 (32.2%)
After-tax
impact from: Pre-operating expenses1 9,455 397
Net accrual for legal settlements
- 16,068 Litigation settlement received - (5,574) Special charge2
3,466 - Loss/(Gain) on disposal of aircraft (232)
(2,294)
Adjusted Net Income Attributable to Common
Stockholders $ 108,772 $ 150,407 (27.7%)
Diluted
EPS $ 3.64 $ 5.44 (33.1%)
After-tax impact from:
Pre-operating expenses1 0.36 0.02
Net accrual for legal settlements
- 0.62 Litigation settlement received - (0.21) Special charge2 0.13
- Loss/(Gain) on disposal of aircraft (0.01) (0.09)
Adjusted Diluted EPS $ 4.12 $ 5.773 (28.6%) 1
Pre-operating expenses in 2011 and 2010 are related to the
introduction of new aircraft types and include incremental costs
incurred as a result of aircraft delivery delays. 2 Included in
Special charge in 2011 are asset impairment and employee
termination charges related to the retirement of the 747-200 fleet.
3 Items do not sum due to rounding.
Atlas Air Worldwide Holdings,
Inc.
Operating Statistics and Traffic
Results
(in thousands)
(Unaudited)
For the Three
Months Ended For the Twelve Months Ended December
31, Percent December 31, Percent
2011 2010 Change 2011
2010 Change Fleet (average during the
period) ACMI 22.1 21.0 5.2% 21.7 18.4 17.9% AMC Charter 6.5 4.3
51.2% 5.9 5.5 7.3% Commercial Charter 4.4 4.1 7.3% 3.7 4.7 (21.3%)
Dry Leasing 3.0 1.0 200.0% 2.2 0.8
175.0% Operating Aircraft 36.0 30.4 18.4% 33.5
29.4 13.9% Out of Service (1) 0.1 - NM 0.4 0.1
300.0%
Block Hours ACMI 26,382 25,952 1.7% 102,695
91,357 12.4% AMC Charter 5,121 4,356 17.6% 19,208 18,679 2.8%
Commercial Charter 4,142 4,540 (8.8%) 13,879 17,572 (21.0%) Non
revenue 476 181 163.0% 1,273 750 69.7%
Total Block Hours 36,121 35,029 3.1% 137,055
128,358 6.8%
Revenue Per Block Hour ACMI $
6,164 $ 6,163 0.0% $ 6,159 $ 5,953 3.5% AMC Charter 24,701 19,669
25.6% 23,049 20,825 10.7% Commercial Charter 22,350 23,990 (6.8%)
21,581 21,878 (1.4%)
Average Utilization (block hours per
day) ACMI 13.0 13.4 (3.0%) 13.0 13.6 (4.4%) AMC Charter 8.6
11.0 (21.8%) 8.9 9.3 (4.3%) Commercial Charter 10.2
12.0 (15.0%) 10.3 10.2 1.0% All Operating Aircraft
(2) 11.9 13.0 (8.5%) 12.0 12.3 (2.4%)
Fuel AMC
Average fuel cost per gallon $ 3.97 $ 2.68 48.1% $ 3.63 $ 2.68
35.4% Fuel gallons consumed (000s) 15,405 13,992 10.1% 60,976
58,022 5.1%
Commercial Charter Average fuel cost per gallon
$ 3.24 $ 2.51 29.1% $ 3.29 $ 2.37 38.8% Fuel gallons consumed
(000s) 15,209 16,094 (5.5%) 50,872 61,154 (16.8%) (1)
Out-of-service aircraft were temporarily parked during the period
and are completely unencumbered. Permanently parked aircraft, all
of which are also completely unencumbered, are not included in the
operating statistics above. (2) Average of All Operating
Aircraft excludes Dry Leasing aircraft, which do not contribute to
block-hour volumes.
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