Atlas Air 2022 net income drops 28%
Revenue increased 12% to $4.5 billion, volumes down 9% to 330,738 block hours
Atlas Air Worldwide Holdings reported a 28 percent decline in net income at $355.9 million for 2022, or $10.53 per diluted share, compared with net income of $493.3 million, or $16.16 per diluted share, in 2021.
"On an adjusted basis, EBITDA totaled $899.2 million in 2022 compared with $1.1 billion in 2021. Adjusted net income in 2022 totaled $418 million, or $14.23 per diluted share, compared with $551.0 million, or $18.51 per diluted share, in 2021," says an official release.
Revenue increased 12 percent to $4.5 billion in 2022 from $4 billion in 2021. Volumes totalled 330,738 block hours compared with 364,061 in 2021, a decline of 9 percent.
John W. Dietrich, President and Chief Executive Officer, Atlas Air says: “2022 was one of the best years in Atlas’ history, and we are pleased that we placed all eight of our new and incoming aircraft under long-term contracts. All four new 747-8Fs and the first of four 777Fs have been delivered and are operating for strategic customers under attractive long-term agreements.
“In January, we took delivery of the final 747 ever to be produced by Boeing during a historic ceremony. Although the celebration marked the end of the 54-year production run for the ‘Queen of the Skies,’ it is only the beginning for this aircraft, which will serve the airfreight market for decades to come.
“Atlas began over 30 years ago with a single 747-200 freighter and since then, we became, and still are, the world’s largest operator of 747 freighters. Our company’s history and success are directly linked to the 747 platform, and it is fitting that we took delivery of the final four of these iconic aircraft.”
Q4 results
Revenue increased 4 percent to $1.21 billion in the fourth quarter of 2022 compared with $1.16 billion in Q42021. Volumes in the fourth quarter of 2022 declined 8 percent to 84,916 block hours compared with 91,985 in the fourth quarter of 2021.
"For the three months ended December 31, 2022, reported net income totaled $126 million, or $3.70 per diluted share, compared with $176.7 million, or $5.55 per diluted share, in the fourth quarter of 2021."
Higher airline operations revenue reflected an increase in the average rate per block hour, partially offset by the reduction in block hours flown. "The higher average rate per block hour was primarily due to higher fuel prices and yields (net of fuel), including the impact of new and extended long-term contracts and increased cargo flying for the AMC. Block hours decreased primarily due to the impact of severe winter storms and a reduction in less profitable smaller gauge CMI flying. The abnormal increase in severe weather events also adversely impacted our crew availability and our ability to position them due to the widespread and well-publicised cancellations of commercial passenger flights."
Fleet position
All four new 747-8Fs have been delivered, including the final 747 in January 2023. All four of these aircraft are placed with strategic customers under long-term agreements, the release added.
"All four of our new and incoming 777-200LRFs have been placed under a long-term ACMI contract with MSC Mediterranean Shipping Company SA. The first aircraft was delivered in late November 2022, with three more expected to be delivered throughout 2023."
Cash
At December 31, 2022, our cash, including cash equivalents and restricted cash, totaled $773.9 million compared with $921 million at December 31, 2021. "The change in position resulted from cash used for investing and financing activities including $185.6 million for pre-delivery payments for our new aircraft, $216.6 million related to the settlement of our 2015 convertible notes and $100 million for our accelerated share repurchase programme (which we have suspended in connection with the proposed merger), partially offset by cash provided by operating activities."
Transaction update
Atlas Air had entered into a definitive agreement to be acquired by an investor group led by funds managed by affiliates of Apollo Global Management together with investment affiliates of J.F. Lehman & Company and Hill City Capital. "In light of this pending acquisition, Atlas Air will not hold an earnings conference call or provide forward-looking guidance," says the release.
Atlas is working to complete the transaction in the first quarter of 2023, and continues to make progress toward obtaining necessary approvals. Atlas is awaiting final approval from the U.S. Department of Transportation and has received all other required shareholder and regulatory approvals, the release added.
