Atlas Air Worldwide Holdings, Inc. (Nasdaq:
AAWW) today announced first-quarter 2022 net income of $81.5
million, or $2.38 per diluted share, compared with $89.9
million, or $3.05 per diluted share, in 2021 (which included $40.9
million, $31.9 million after tax, of CARES Act grant income).
On an adjusted basis, EBITDA totaled $202.8
million in the first quarter of 2022 compared with $181.3 million
in the prior-year period. For the three months ended March 31,
2022, adjusted net income totaled $88.8 million, or $2.99 per
diluted share, compared with $72.2 million, or $2.45 per diluted
share, in 2021.
“We are off to an excellent start in 2022. We
delivered strong earnings, despite the pandemic-related operational
challenges we continue to navigate,” said Atlas Air Worldwide
President and Chief Executive Officer John W. Dietrich. “I would
like to thank the entire Atlas team for their ongoing commitment to
deliver this great performance.”
He added: “Atlas continues to demonstrate the
value of airfreight as a vital component of the global supply
chain. We are seeing a sustaining shift in long-term customer
demand for Atlas’ dedicated aircraft, and the speed and reliability
airfreight provides. During the first quarter, our customers
continued to enter and enhance long-term contracts with Atlas for
dedicated freighter capacity.
“We are expanding and diversifying our customer
base, and increasing flying under long-term contracts with
attractive rates and guaranteed levels of flying. To meet customer
demand, we are also investing in our world-class fleet by adding
four new 747-8F and four new 777 freighter aircraft. All four of
our new 747-8Fs have been placed with customers under long-term
contracts, and we have strong interest for the new 777Fs as
well.”
Mr. Dietrich concluded: “We are very well
positioned for the years ahead. We have significantly strengthened
our balance sheet and have a healthy cash balance. This provides us
the financial flexibility to opportunistically deploy capital,
including investing in our business and returning capital to
shareholders.”
First-Quarter Results
Revenue grew to $1.0 billion in the first
quarter of 2022 compared with $861.3 million in the prior-year
quarter. Volumes in the first quarter of 2022 totaled 82,626 block
hours compared with 88,523 in the first quarter of 2021.
For the three months ended March 31, 2022, our
reported net income totaled $81.5 million, or $2.38 per diluted
share, compared with net income of $89.9 million, or $3.05 per
diluted share, in the first quarter of 2021 (which included $40.9
million, $31.9 million after tax, of CARES Act grant income).
On an adjusted basis, EBITDA was $202.8 million
in the first quarter this year compared with $181.3 million in the
first quarter of 2021. Adjusted net income in the first quarter of
2022 totaled $88.8 million, or $2.99 per diluted share, compared
with $72.2 million, or $2.45 per diluted share, in the prior-year
period.
Reported earnings also included an effective income tax rate of
22.8%. On an adjusted basis, our results reflected an effective
income tax rate of 22.3%.
Higher Airline Operations revenue primarily
reflected an increase in the average rate per block hour, partially
offset by a reduction in block hours. The higher average rate per
block hour was primarily due to higher yields (net of fuel),
including the impact of new and extended long-term contracts, as
well as higher fuel prices. Block-hour volumes reflected a
reduction in less profitable smaller gauge CMI service flying as
well as operational disruptions due to the spike in Omicron cases
globally.
Higher Airline Operations segment contribution
in the first quarter of 2022 was primarily driven by higher yields
(net of fuel), including the impact of new and extended long-term
contracts. These improvements were partially offset by increased
pilot costs related to our new collective bargaining agreement
(CBA) and higher premium pay for pilots operating in certain areas
significantly impacted by COVID-19.
In Dry Leasing, segment revenue and contribution
increased from the prior-year period primarily due to $5.0 million
of revenue received from maintenance payments related to the
scheduled return of an aircraft, which was subsequently sold during
the quarter. Dry Leasing contribution also benefited from lower
interest expense related to the scheduled repayment of debt.
Unallocated income and expenses, net, increased
during the quarter, primarily due to $40.9 million in CARES Act
grant income recognized in 2021 (which was excluded from our
adjusted results).
Share Repurchases
As previously announced in February 2022, our
Board of Directors approved a share repurchase program authorizing
up to $200.0 million of our common stock, which we began by
entering into a $100.0 million accelerated share repurchase program
(ASR). In total, we repurchased 1,234,144 shares under the ASR,
which was completed in April.
Additional purchases may be made at our
discretion in the form of open market repurchase programs, ASRs,
privately negotiated transactions, or a combination of these
methods.
Fleet
As previously disclosed, we are purchasing five
of our existing 747-400Fs at the end of their leases during the
course of this year, one of which was acquired in March. We expect
to complete the remaining four aircraft acquisitions between May
and December 2022.
Acquiring these widebody freighters underscores
our confidence in the demand for international airfreight capacity,
particularly in express, e-Commerce and fast-growing global
markets. Keeping these aircraft in our fleet ensures continuity of
capacity for our customers, which will drive strong returns for
Atlas in the years ahead.
Cash
At March 31, 2022, our cash, including cash
equivalents and restricted cash, totaled $740.9 million compared
with $921.0 million at December 31, 2021.
The change in position resulted from cash used
for investing and financing activities, including $115.0 million
for pre-delivery payments for our new aircraft and $100.0 million
for our ASR, partially offset by cash provided by operating
activities.
Net cash used for investing activities during
the first quarter of 2022 primarily related to payments for flight
equipment and modifications, including aircraft pre-delivery
payments, as well as capital expenditures and spare
engines.
Net cash used for financing activities during
the period primarily related to payments on debt obligations and
the ASR.
2022 Outlook*
For the second quarter of 2022, we expect
revenue to exceed $1.1 billion from flying more than 85,000 block
hours. We also anticipate adjusted EBITDA of approximately $215.0
million, and adjusted net income to grow by a high-single-digit
percentage compared with adjusted net income of $88.8 million in
the first quarter of 2022.
For the full year, we expect to fly more than
350,000 block hours, with revenue of approximately $4.6 billion,
and adjusted EBITDA of about $1.0 billion. In addition, we
anticipate adjusted net income in the second half of 2022 to
improve approximately 60% compared with adjusted net income in the
first half of this year.
We expect aircraft maintenance expense in 2022
to be similar to 2021, and depreciation and amortization to total
about $300 million. In addition, core capital expenditures, which
exclude aircraft and engine purchases, are projected to total
approximately $135 to $145 million, mainly for parts and components
for our fleet.
We also expect our full-year 2022 adjusted
effective tax rate will be approximately 23.0%.
This outlook includes the contribution from
numerous new or enhanced long-term customer contracts, as well as
higher pilot costs from our new CBA. We also expect second-quarter
results to continue to be impacted by premium pay for pilots
operating in certain locations significantly impacted by
COVID-19.
Other than with regard to revenue, we provide
guidance on an adjusted basis because we are unable to predict with
reasonable certainty and without unreasonable effort the effects on
future gains and losses on asset sales, special charges and other
unanticipated items that could be material to our reported
results.*
Conference Call
As previously announced, management will host a
conference call to discuss Atlas Air Worldwide’s first-quarter 2022
financial and operating results at 11:00 a.m. Eastern Time on
Thursday, May 5, 2022.
Interested parties may listen to the call live at Atlas Air
Worldwide’s Investor site or at
https://edge.media-server.com/mmc/p/w2te9jpb.
For those unable to listen to the live call, a
replay will be archived on the Investor site following the call. A
replay will also be available through May 12 by dialing (855)
859-2056 (U.S. Toll Free) or (404) 537-3406 (from outside the U.S.)
and using Access Code 3594535#.
About Non-GAAP Financial
Measures
To supplement our financial statements presented
in accordance with U.S. GAAP, we present certain non-GAAP financial
measures to assist in the evaluation of our business performance.
These non-GAAP measures include Adjusted EBITDA; Adjusted net
income; Adjusted Diluted EPS; Adjusted effective tax rate; and Free
Cash Flow, which exclude certain noncash income and expenses, and
items impacting 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 Net income; Diluted EPS; Effective
tax rate; and Net Cash Provided by Operating Activities, which are
the most directly comparable measures of performance prepared in
accordance with U.S. GAAP, respectively.
Our management uses these non-GAAP financial
measures in assessing the performance of the company’s ongoing
operations and in planning and forecasting future periods. We
believe that these adjusted measures, when considered together with
the corresponding U.S. GAAP financial measures and the
reconciliations to those measures, provide meaningful supplemental
information to assist investors and analysts in understanding our
financial results and assessing our prospects for future
performance. For example:
- Adjusted EBITDA; Adjusted net income; and Adjusted Diluted EPS
provide a more comparable basis to analyze operating results and
earnings and are measures commonly used by shareholders to measure
our performance. In addition, management’s incentive compensation
is determined, in part, by using Adjusted EBITDA and Adjusted net
income.
- Adjusted effective tax rate provides insight into the tax
effects of our ongoing business operations.
- Free Cash Flow helps investors assess our ability, over the
long term, to create value for our shareholders as it represents
cash available to execute our capital allocation strategy.
*Other than with regard to revenue, we provide
guidance only on an adjusted basis and are unable to provide
forward-looking guidance on a U.S. GAAP basis or a reconciliation
to the most directly comparable U.S. GAAP measures because we are
unable to predict with reasonable certainty and without
unreasonable effort, the ultimate outcome of certain significant
items, including future gains and losses on asset sales, special
charges and other unanticipated items. These items are uncertain,
depend on various factors, and could have a material impact on our
U.S. GAAP results.
About Atlas Air Worldwide:
Atlas Air Worldwide is a leading global provider
of outsourced aircraft and aviation operating services. It is the
parent company of Atlas Air, Inc. and Titan Aviation Holdings,
Inc., and is the majority shareholder of Polar Air Cargo Worldwide,
Inc. Our companies operate the world’s largest fleet of 747
freighter aircraft and provide customers the broadest array of
Boeing 747, 777, 767 and 737 aircraft for domestic, regional and
international cargo and passenger operations.
Atlas Air Worldwide’s press releases, SEC
filings and other information may be accessed through the company’s
home page, www.atlasairworldwide.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. Those statements are based on management’s beliefs,
plans, expectations and assumptions, and on information currently
available to management. Generally, the words “will,” “may,”
“should,” “could,” “would,” “expect,” “anticipate,” “intend,”
“plan,” “continue,” “believe,” “seek,” “project,” “estimate,” and
similar expressions used in this release that do not relate to
historical facts are intended to identify forward-looking
statements.
Such forward-looking statements speak only as of
the date of this release. They 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: our ability to effectively
operate the network service contemplated by our agreements with
Amazon; the possibility that Amazon may terminate its agreements
with the companies; 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, pilots
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; changes in U.S. and non-U.S. government trade and tax
policies; economic conditions; the impact of geographical events or
health epidemics such as the COVID-19 pandemic; the impact of
COVID-19 vaccine mandates; our compliance with the requirements and
restrictions under the Payroll Support Program; the effects of any
hostilities or act of war or any terrorist attack; significant data
breach or disruption of our information technology systems; labor
costs and relations, work stoppages and service slowdowns;
financing costs; the cost and availability of war risk insurance;
aviation fuel costs; security-related costs; competitive pressures
on pricing (especially from lower-cost competitors); volatility in
the international currency markets; geopolitical events; weather
conditions; natural disasters; government legislation and
regulation; border restrictions; 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 most
recent Annual Report on Form 10-K and subsequent reports on Form
10-Q filed by Atlas Air Worldwide with the Securities and Exchange
Commission. 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 2022 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 and
expressly disclaims any obligation to revise or update publicly any
forward-looking statement to reflect future events or
circumstances.
Atlas Air Worldwide Holdings,
Inc.Consolidated Statements of
Operations(in thousands, except per share
data)(Unaudited)
|
|
For the Three Months Ended |
|
|
|
March 31, 2022 |
|
|
March 31, 2021 |
|
|
|
|
|
|
|
|
Operating Revenue |
|
$ |
1,037,156 |
|
|
$ |
861,300 |
|
|
|
|
|
|
|
|
Operating
Expenses |
|
|
|
|
|
|
Salaries, wages and benefits |
|
|
298,019 |
|
|
|
202,614 |
|
Aircraft fuel |
|
|
244,337 |
|
|
|
163,551 |
|
Maintenance, materials and repairs |
|
|
118,899 |
|
|
|
121,133 |
|
Depreciation and amortization |
|
|
72,202 |
|
|
|
67,789 |
|
Travel |
|
|
42,768 |
|
|
|
37,672 |
|
Navigation fees, landing fees and other rent |
|
|
39,354 |
|
|
|
44,887 |
|
Passenger and ground handling services |
|
|
34,936 |
|
|
|
40,065 |
|
Aircraft rent |
|
|
12,995 |
|
|
|
20,756 |
|
Loss (gain) on disposal of flight equipment |
|
|
(6,240 |
) |
|
|
16 |
|
Special charge |
|
|
2,633 |
|
|
|
- |
|
Transaction-related expenses |
|
|
- |
|
|
|
201 |
|
Other |
|
|
55,857 |
|
|
|
58,412 |
|
Total Operating Expenses |
|
|
915,760 |
|
|
|
757,096 |
|
|
|
|
|
|
|
|
Operating Income |
|
|
121,396 |
|
|
|
104,204 |
|
|
|
|
|
|
|
|
Non-operating Expenses
(Income) |
|
|
|
|
|
|
Interest income |
|
|
(240 |
) |
|
|
(211 |
) |
Interest expense |
|
|
20,423 |
|
|
|
27,180 |
|
Capitalized interest |
|
|
(3,764 |
) |
|
|
(1,271 |
) |
Unrealized loss on financial instruments |
|
|
- |
|
|
|
113 |
|
Other (income) expense, net |
|
|
(618 |
) |
|
|
(39,456 |
) |
Total Non-operating Expenses (Income) |
|
|
15,801 |
|
|
|
(13,645 |
) |
|
|
|
|
|
|
|
Income before income taxes |
|
|
105,595 |
|
|
|
117,849 |
|
Income tax expense |
|
|
24,084 |
|
|
|
27,916 |
|
|
|
|
|
|
|
|
Net Income |
|
$ |
81,511 |
|
|
$ |
89,933 |
|
Earnings per
share: |
|
|
|
|
|
|
Basic |
|
$ |
2.82 |
|
|
$ |
3.16 |
|
|
|
|
|
|
|
|
Diluted |
|
$ |
2.38 |
|
|
$ |
3.05 |
|
|
|
|
|
|
|
|
Weighted average
shares: |
|
|
|
|
|
|
Basic |
|
|
28,854 |
|
|
|
28,491 |
|
|
|
|
|
|
|
|
Diluted |
|
|
34,690 |
|
|
|
29,478 |
|
Atlas Air Worldwide Holdings,
Inc. Consolidated Balance Sheets (in
thousands, except share data)(Unaudited)
|
|
March 31, 2022 |
|
|
December 31, 2021 |
|
Assets |
|
|
|
|
|
|
Current
Assets |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
730,349 |
|
|
$ |
910,965 |
|
Restricted cash |
|
|
10,554 |
|
|
|
10,052 |
|
Accounts receivable, net of allowance of $4,178 and $4,003,
respectively |
|
|
297,264 |
|
|
|
305,905 |
|
Prepaid expenses, assets held for sale and other current
assets |
|
|
93,910 |
|
|
|
99,100 |
|
Total current assets |
|
|
1,132,077 |
|
|
|
1,326,022 |
|
Property and
Equipment |
|
|
|
|
|
|
Flight equipment |
|
|
5,507,628 |
|
|
|
5,449,100 |
|
Ground equipment |
|
|
103,498 |
|
|
|
101,824 |
|
Less: accumulated depreciation |
|
|
(1,360,736 |
) |
|
|
(1,319,636 |
) |
Flight equipment purchase deposits and modifications in
progress |
|
|
438,308 |
|
|
|
352,422 |
|
Property and equipment, net |
|
|
4,688,698 |
|
|
|
4,583,710 |
|
Other
Assets |
|
|
|
|
|
|
Operating lease right-of-use assets |
|
|
130,748 |
|
|
|
138,744 |
|
Deferred costs and other assets |
|
|
317,993 |
|
|
|
329,971 |
|
Intangible assets, net and goodwill |
|
|
63,289 |
|
|
|
64,796 |
|
Total
Assets |
|
$ |
6,332,805 |
|
|
$ |
6,443,243 |
|
|
|
|
|
|
|
|
Liabilities and
Equity |
|
|
|
|
|
|
Current
Liabilities |
|
|
|
|
|
|
Accounts payable |
|
$ |
122,751 |
|
|
$ |
82,885 |
|
Accrued liabilities |
|
|
615,134 |
|
|
|
641,978 |
|
Current portion of long-term debt and finance leases |
|
|
607,999 |
|
|
|
639,811 |
|
Current portion of long-term operating leases |
|
|
55,587 |
|
|
|
55,383 |
|
Total current liabilities |
|
|
1,401,471 |
|
|
|
1,420,057 |
|
Other
Liabilities |
|
|
|
|
|
|
Long-term debt and finance leases |
|
|
1,615,305 |
|
|
|
1,655,075 |
|
Long-term operating leases |
|
|
152,150 |
|
|
|
166,022 |
|
Deferred taxes |
|
|
371,518 |
|
|
|
354,798 |
|
Financial instruments and other liabilities |
|
|
31,031 |
|
|
|
37,954 |
|
Total other liabilities |
|
|
2,170,004 |
|
|
|
2,213,849 |
|
Commitments and contingencies |
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
Stockholders’ Equity |
|
|
|
|
|
|
Preferred stock, $1 par value; 10,000,000 shares authorized; no
shares issued |
|
|
- |
|
|
|
- |
|
Common stock, $0.01 par value; 100,000,000 shares
authorized; 35,071,410 and
34,707,860 shares issued, 28,363,266 and 29,215,702
shares outstanding (net of treasury stock), as
of March 31, 2022 and December 31,
2021, respectively |
|
|
351 |
|
|
|
347 |
|
Additional paid-in capital |
|
|
828,391 |
|
|
|
934,516 |
|
Treasury stock, at cost; 6,708,144 and 5,492,158 shares,
respectively |
|
|
(317,480 |
) |
|
|
(225,461 |
) |
Accumulated other comprehensive loss |
|
|
(433 |
) |
|
|
(511 |
) |
Retained earnings |
|
|
2,250,501 |
|
|
|
2,100,446 |
|
Total stockholders’ equity |
|
|
2,761,330 |
|
|
|
2,809,337 |
|
Total Liabilities and
Equity |
|
$ |
6,332,805 |
|
|
$ |
6,443,243 |
|
1 Balance sheet debt at March 31, 2022
totaled $2,223.3 million, including the impact of debt issuance
costs of $20.7 million, compared with $2,294.9 million, including
the impact of $31.5 million of unamortized discount and debt
issuance costs of $22.7 million at December 31, 2021.
2 The face value of our debt and finance leases
at March 31, 2022 totaled $2,244.0 million, compared with
$2,349.1 million on December 31, 2021.
Atlas Air Worldwide Holdings,
Inc. Consolidated Statements of Cash
Flows (in thousands) (Unaudited)
|
|
For the Three Months Ended |
|
|
|
March 31, 2022 |
|
|
March 31, 2021 |
|
|
|
|
|
|
|
|
Operating
Activities: |
|
|
|
|
|
|
Net Income |
|
$ |
81,511 |
|
|
$ |
89,933 |
|
|
|
|
|
|
|
|
Adjustments to reconcile Net
Income to net cash provided by operating activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
|
85,257 |
|
|
|
86,172 |
|
Provision for (reversal of) expected credit losses |
|
|
(15 |
) |
|
|
(397 |
) |
Special charge |
|
|
2,633 |
|
|
|
- |
|
Unrealized loss on financial instruments |
|
|
- |
|
|
|
113 |
|
Loss (gain) on disposal of flight equipment |
|
|
(6,240 |
) |
|
|
16 |
|
Deferred taxes |
|
|
23,682 |
|
|
|
27,839 |
|
Stock-based compensation |
|
|
2,195 |
|
|
|
4,060 |
|
Changes
in: |
|
|
|
|
|
|
Accounts receivable |
|
|
9,960 |
|
|
|
(22,745 |
) |
Prepaid expenses, current assets and other assets |
|
|
(3,619 |
) |
|
|
(7,500 |
) |
Accounts payable, accrued liabilities and other liabilities |
|
|
12,475 |
|
|
|
(89,366 |
) |
Net cash provided by operating
activities |
|
|
207,839 |
|
|
|
88,125 |
|
Investing
Activities: |
|
|
|
|
|
|
Capital expenditures |
|
|
(29,895 |
) |
|
|
(26,662 |
) |
Purchase deposits and payments for flight equipment and
modifications |
|
|
(154,420 |
) |
|
|
(126,807 |
) |
Investment in joint ventures |
|
|
(783 |
) |
|
|
(1,608 |
) |
Proceeds from disposal of flight equipment |
|
|
13,500 |
|
|
|
1,850 |
|
Net cash used for investing
activities |
|
|
(171,598 |
) |
|
|
(153,227 |
) |
Financing
Activities: |
|
|
|
|
|
|
Proceeds from debt issuance |
|
|
- |
|
|
|
16,161 |
|
Payment of debt issuance costs |
|
|
(81 |
) |
|
|
(900 |
) |
Payments of debt and finance lease obligations |
|
|
(108,466 |
) |
|
|
(77,953 |
) |
Prepayment of accelerated share repurchase |
|
|
(20,034 |
) |
|
|
- |
|
Purchase of treasury stock |
|
|
(79,966 |
) |
|
|
- |
|
Customer maintenance reserves and deposits received |
|
|
4,245 |
|
|
|
5,152 |
|
Customer maintenance reserves paid |
|
|
- |
|
|
|
(12,265 |
) |
Treasury shares withheld for payment of taxes |
|
|
(12,053 |
) |
|
|
(7,350 |
) |
Net cash used for financing
activities |
|
|
(216,355 |
) |
|
|
(77,155 |
) |
Net decrease in cash, cash
equivalents and restricted cash |
|
|
(180,114 |
) |
|
|
(142,257 |
) |
Cash, cash equivalents and
restricted cash at the beginning of period |
|
|
921,017 |
|
|
|
856,281 |
|
Cash, cash equivalents and
restricted cash at the end of period |
|
$ |
740,903 |
|
|
$ |
714,024 |
|
|
|
|
|
|
|
|
Noncash Investing and
Financing Activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of property and equipment included in Accounts payable
and accrued liabilities |
|
$ |
3,146 |
|
|
$ |
24,938 |
|
Acquisition of property and equipment acquired under operating
leases |
|
$ |
104 |
|
|
$ |
4,015 |
|
Acquisition of flight equipment under finance leases |
|
$ |
3,108 |
|
|
$ |
20,171 |
|
Issuance of shares related to settlement of warrant liability |
|
$ |
- |
|
|
$ |
31,582 |
|
Atlas Air Worldwide Holdings, Inc. Direct
Contribution (in thousands) (Unaudited)
|
|
For the Three Months Ended |
|
|
|
March 31, 2022 |
|
|
March 31, 2021 |
|
Operating
Revenue: |
|
|
|
|
|
|
Airline Operations |
|
$ |
995,355 |
|
|
$ |
826,240 |
|
Dry Leasing |
|
|
46,170 |
|
|
|
40,364 |
|
Customer incentive asset
amortization |
|
|
(10,051 |
) |
|
|
(10,481 |
) |
Other |
|
|
5,682 |
|
|
|
5,177 |
|
Total Operating
Revenue |
|
$ |
1,037,156 |
|
|
$ |
861,300 |
|
|
|
|
|
|
|
|
Direct
Contribution: |
|
|
|
|
|
|
Airline Operations |
|
$ |
185,818 |
|
|
$ |
169,150 |
|
Dry Leasing |
|
|
16,909 |
|
|
|
10,564 |
|
Total Direct Contribution
for Reportable Segments |
|
|
202,727 |
|
|
|
179,714 |
|
|
|
|
|
|
|
|
Unallocated income and
(expenses), net |
|
|
(100,739 |
) |
|
|
(61,535 |
) |
Unrealized (loss) on financial
instruments |
|
|
- |
|
|
|
(113 |
) |
Special charge |
|
|
(2,633 |
) |
|
|
- |
|
Transaction-related expenses |
|
|
- |
|
|
|
(201 |
) |
Loss (gain) on disposal of flight
equipment |
|
|
6,240 |
|
|
|
(16 |
) |
Income before income
taxes |
|
|
105,595 |
|
|
|
117,849 |
|
|
|
|
|
|
|
|
Add back (subtract): |
|
|
|
|
|
|
Interest income |
|
|
(240 |
) |
|
|
(211 |
) |
Interest expense |
|
|
20,423 |
|
|
|
27,180 |
|
Capitalized interest |
|
|
(3,764 |
) |
|
|
(1,271 |
) |
Unrealized loss on financial
instruments |
|
|
- |
|
|
|
113 |
|
Other (income) expense, net |
|
|
(618 |
) |
|
|
(39,456 |
) |
Operating
Income |
|
$ |
121,396 |
|
|
$ |
104,204 |
|
Atlas Air Worldwide uses an economic performance
metric, Direct Contribution, to show the profitability of each of
its segments after allocation of direct operating and ownership
costs. Atlas Air Worldwide currently has the following reportable
segments: Airline Operations and Dry Leasing.
Direct Contribution consists of income (loss)
before taxes, excluding loss on early extinguishment of debt,
unrealized loss on financial instruments, special charge,
transaction-related expenses, loss (gain) on disposal of flight
equipment, nonrecurring items, and unallocated expenses and
(income), net.
Direct operating and ownership costs include
crew costs, maintenance, fuel, ground operations, sales costs,
aircraft rent, interest expense on the portion of debt used for
financing aircraft, interest income on debt securities, and
aircraft depreciation.
Unallocated expenses and (income), net include
corporate overhead, nonaircraft depreciation, noncash expenses and
income, interest expense on the portion of debt used for general
corporate purposes, interest income on nondebt securities,
capitalized interest, foreign exchange gains and losses, other
revenue, other nonoperating costs and CARES Act grant
income.
Atlas Air Worldwide Holdings, Inc.
Reconciliation to Non-GAAP Measures (in thousands, except
per share data) (Unaudited)
|
|
For the Three Months Ended |
|
|
|
March 31, 2022 |
|
|
|
March 31, 2021 |
|
|
Percent Change |
|
|
|
|
|
|
|
|
|
|
|
|
Net Income |
|
$ |
81,511 |
|
|
|
$ |
89,933 |
|
|
|
(9.4 |
)% |
Impact from: |
|
|
|
|
|
|
|
|
|
|
CARES Act grant income1 |
|
|
- |
|
|
|
|
(40,944 |
) |
|
|
|
Customer incentive asset amortization |
|
|
10,051 |
|
|
|
|
10,481 |
|
|
|
|
Adjustments to CBA paid time-off benefits2 |
|
|
2,154 |
|
|
|
|
- |
|
|
|
|
Special charge3 |
|
|
2,633 |
|
|
|
|
- |
|
|
|
|
Noncash expenses and income, net4 |
|
|
- |
|
|
|
|
4,672 |
|
|
|
|
Unrealized loss on financial instruments |
|
|
- |
|
|
|
|
113 |
|
|
|
|
Other, net5 |
|
|
(6,240 |
) |
|
|
|
329 |
|
|
|
|
Income tax effect of reconciling items |
|
|
(1,329 |
) |
|
|
|
7,631 |
|
|
|
|
Adjusted Net
Income |
|
$ |
88,780 |
|
|
|
$ |
72,215 |
|
|
|
22.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
Weighted average diluted
shares outstanding |
|
|
34,690 |
|
|
|
|
29,478 |
|
|
|
|
Less: effect of
convertible notes hedges6 |
|
|
(5,031 |
) |
|
|
|
- |
|
|
|
|
Adjusted weighted average
diluted shares outstanding |
|
|
29,659 |
|
|
|
|
29,478 |
|
|
|
|
Adjusted Diluted
EPS |
|
$ |
2.99 |
|
|
|
$ |
2.45 |
|
|
|
22.0 |
% |
|
|
For the Three Months Ended |
|
|
|
March 31, 2022 |
|
March 31, 2021 |
|
Percent Change |
|
|
|
|
|
|
|
|
|
Income before income taxes |
|
$ |
105,595 |
|
$ |
117,849 |
|
|
|
(10.4 |
)% |
Impact from: |
|
|
|
|
|
|
|
CARES Act grant income1 |
|
|
- |
|
|
(40,944 |
) |
|
|
Customer incentive asset amortization |
|
|
10,051 |
|
|
10,481 |
|
|
|
Adjustments to CBA paid time-off benefits2 |
|
|
2,154 |
|
|
- |
|
|
|
Special charge3 |
|
|
2,633 |
|
|
- |
|
|
|
Noncash expenses and income, net4 |
|
|
- |
|
|
4,672 |
|
|
|
Unrealized loss on financial instruments |
|
|
- |
|
|
113 |
|
|
|
Other, net5 |
|
|
(6,240 |
) |
|
329 |
|
|
|
Adjusted income before
income taxes |
|
|
114,193 |
|
|
92,500 |
|
|
|
23.5 |
% |
Interest (income) expense, net |
|
|
16,419 |
|
|
21,026 |
|
|
|
Other (income) expense, net |
|
|
(618 |
) |
|
1,488 |
|
|
|
Adjusted operating
income |
|
$ |
129,994 |
|
$ |
115,014 |
|
|
|
13.0 |
% |
|
|
|
|
|
|
|
|
Income tax expense |
|
$ |
24,084 |
|
$ |
27,916 |
|
|
|
Income tax effect of
reconciling items |
|
|
(1,329 |
) |
|
7,631 |
|
|
|
Adjusted income tax expense |
|
|
25,413 |
|
|
20,285 |
|
|
|
|
|
|
|
|
|
|
|
Adjusted income before
income taxes |
|
$ |
114,193 |
|
$ |
92,500 |
|
|
|
Effective tax expense
rate |
|
|
22.8 |
% |
|
23.7 |
% |
|
|
Adjusted effective tax
expense rate |
|
|
22.3 |
% |
|
21.9 |
% |
|
|
Atlas Air Worldwide Holdings, Inc.
Reconciliation to Non-GAAP Measures (in thousands, except
per share data) (Unaudited)
|
|
For the Three Months Ended |
|
|
|
March 31, 2022 |
|
|
|
March 31, 2021 |
|
|
Percent Change |
|
|
|
|
|
|
|
|
|
|
|
|
Net
Income |
|
$ |
81,511 |
|
|
|
$ |
89,933 |
|
|
|
(9.4 |
)% |
Interest expense, net |
|
|
16,419 |
|
|
|
|
25,698 |
|
|
|
|
Depreciation and amortization |
|
|
72,202 |
|
|
|
|
67,789 |
|
|
|
|
Income tax expense |
|
|
24,084 |
|
|
|
|
27,916 |
|
|
|
|
EBITDA |
|
|
194,216 |
|
|
|
|
211,336 |
|
|
|
|
CARES Act grant income1 |
|
|
- |
|
|
|
|
(40,944 |
) |
|
|
|
Customer incentive asset amortization |
|
|
10,051 |
|
|
|
|
10,481 |
|
|
|
|
Adjustments to CBA paid time-off benefits2 |
|
|
2,154 |
|
|
|
|
- |
|
|
|
|
Special charge3 |
|
|
2,633 |
|
|
|
|
- |
|
|
|
|
Unrealized loss on financial instruments |
|
|
- |
|
|
|
|
113 |
|
|
|
|
Other, net5 |
|
|
(6,240 |
) |
|
|
|
329 |
|
|
|
|
Adjusted EBITDA |
|
$ |
202,814 |
|
|
|
$ |
181,315 |
|
|
|
11.9 |
% |
1 CARES Act grant income in 2021 related to
income associated with the Payroll Support Program.
2 Adjustments to CBA paid time-off benefits in
2022 are related to our new CBA.
3 Special charge in 2022 represented a charge
related to two CF6-80 engines Dry Leased to a customer.
4 Noncash expenses and income, net in 2021
primarily related to amortization of debt discount on the
convertible notes.
5 Other, net in 2022 primarily related to a gain
on the sale of six spare CF6-80 engines previously held for sale.
Other, net in 2021 primarily related to costs associated with our
acquisition of an airline and leadership transition costs.
6 Represents the economic benefit from our
convertible notes hedges in offsetting dilution from our
convertible notes as we concluded in no event would economic
dilution result from conversion of each of the convertible notes
when our stock price is below the exercise price of the respective
convertible note warrants.
|
|
For the Three Months Ended |
|
|
|
March 31, 2022 |
|
|
March 31, 2021 |
|
|
|
|
|
|
|
|
Net
Cash Provided by Operating Activities |
|
$ |
207,839 |
|
|
$ |
88,125 |
|
Less: |
|
|
|
|
|
|
Capital expenditures |
|
|
29,895 |
|
|
|
26,662 |
|
Capitalized interest |
|
|
3,764 |
|
|
|
1,271 |
|
Free Cash Flow1 |
|
$ |
174,180 |
|
|
$ |
60,192 |
|
|
|
|
|
|
|
|
1 Free Cash Flow = Net Cash from Operations
minus Core Capital Expenditures and Capitalized Interest.
Core Capital Expenditures excludes purchases of
aircraft.
Atlas Air Worldwide Holdings, Inc.
Operating Statistics and Traffic Results (Unaudited)
|
|
For the Three Months Ended |
|
Increase/ |
|
|
|
March 31, 2022 |
|
|
|
March 31, 2021 |
|
(Decrease) |
|
Block Hours |
|
|
|
|
|
|
|
|
Airline Operations |
|
|
|
|
|
|
|
|
Cargo |
|
|
78,425 |
|
|
83,110 |
|
|
(4,685 |
) |
Passenger |
|
|
3,306 |
|
|
3,648 |
|
|
(342 |
) |
Other |
|
|
895 |
|
|
1,765 |
|
|
(870 |
) |
Total Block Hours |
|
|
82,626 |
|
|
88,523 |
|
|
(5,897 |
) |
|
|
|
|
|
|
|
|
|
Revenue Per Block Hour |
|
|
|
|
|
|
|
|
Airline Operations |
|
$ |
12,178 |
|
$ |
9,524 |
|
$ |
2,654 |
|
Cargo |
|
$ |
11,891 |
|
$ |
9,127 |
|
$ |
2,764 |
|
Passenger |
|
$ |
18,991 |
|
$ |
18,563 |
|
$ |
428 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Utilization (block hours per day) |
|
|
|
|
|
|
|
|
Airline Operations |
|
|
|
|
|
|
|
|
Cargo |
|
|
10.2 |
|
|
10.1 |
|
|
0.1 |
|
Passenger |
|
|
3.6 |
|
|
3.9 |
|
|
(0.3 |
) |
All Operating Aircraft1 |
|
|
9.6 |
|
|
9.7 |
|
|
(0.1 |
) |
|
|
|
|
|
|
|
|
|
Fuel |
|
|
|
|
|
|
|
|
Charter |
|
|
|
|
|
|
|
|
Average fuel cost per gallon |
|
$ |
2.74 |
|
$ |
1.71 |
|
$ |
1.03 |
|
Fuel gallons consumed (000s) |
|
|
89,199 |
|
|
95,586 |
|
|
(6,387 |
) |
1 Average of All Operating Aircraft excludes Dry
Leasing aircraft, which do not contribute to block-hour
volumes.
Atlas Air Worldwide Holdings, Inc.
Operating Statistics and Traffic Results (Unaudited)
|
|
For the Three Months Ended |
|
|
Increase/ |
|
|
|
March 31, 2022 |
|
|
March 31, 2021 |
|
|
(Decrease) |
|
|
|
|
|
|
|
|
|
|
|
Segment Operating Fleet (average aircraft
equivalents during the period) |
|
|
|
|
|
|
|
|
|
Airline Operations1 |
|
|
|
|
|
|
|
|
|
747-8F Cargo |
|
|
10.0 |
|
|
|
10.0 |
|
|
|
- |
|
747-400 Cargo |
|
|
34.5 |
|
|
|
33.6 |
|
|
|
0.9 |
|
747-400 Dreamlifter |
|
|
0.3 |
|
|
|
1.2 |
|
|
|
(0.9 |
) |
747-400 Passenger |
|
|
4.9 |
|
|
|
4.9 |
|
|
|
- |
|
777-200 Cargo |
|
|
9.0 |
|
|
|
9.0 |
|
|
|
- |
|
767-300 Cargo |
|
|
24.0 |
|
|
|
24.0 |
|
|
|
- |
|
767-300 Passenger |
|
|
5.3 |
|
|
|
5.0 |
|
|
|
0.3 |
|
767-200 Cargo |
|
|
- |
|
|
|
5.6 |
|
|
|
(5.6 |
) |
767-200 Passenger |
|
|
- |
|
|
|
0.6 |
|
|
|
(0.6 |
) |
737-800 Cargo |
|
|
8.0 |
|
|
|
8.0 |
|
|
|
- |
|
Total |
|
|
96.0 |
|
|
|
101.9 |
|
|
|
(5.9 |
) |
Dry Leasing |
|
|
|
|
|
|
|
|
|
777-200 Cargo |
|
|
7.0 |
|
|
|
7.0 |
|
|
|
- |
|
767-300 Cargo |
|
|
21.0 |
|
|
|
21.0 |
|
|
|
- |
|
737-300 Cargo |
|
|
- |
|
|
|
1.0 |
|
|
|
(1.0 |
) |
Total |
|
|
28.0 |
|
|
|
29.0 |
|
|
|
(1.0 |
) |
Less: Aircraft Dry Leased to CMI customers |
|
|
(21.0 |
) |
|
|
(21.0 |
) |
|
|
- |
|
Total Operating Average Aircraft Equivalents |
|
|
103.0 |
|
|
|
109.9 |
|
|
|
(6.9 |
) |
1 Airline Operations average fleet excludes spare aircraft
provided by CMI customers.
Contacts:
Investors – InvestorRelations@atlasair.com Media
– CorpCommunications@atlasair.com
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