Aircraft leasing company Air Transport Services Group (ATSG) has highlighted that its half-year results reflect “solid growth, improving cash flows and strong demand for leased cargo aircraft”.
During the first half of this year, the group's revenues increased 13% to $378m, while adjusted ebit rose 20% to $125.6m.
“Increased contributions from ATSG’s airlines, and from the increase in externally leased 767 freighters, drove the majority of the increase in adjusted ebitda” the company explained in its half-year results.
Rich Corrado (pictured), president and chief executive officer of ATSG, commented: “Near-term pandemic effects aside, ATSG remains a growing, thriving air transport business with substantial growth potential in the coming years”.
He added: “ATSG’s airlines leveraged short-term charter and ACMI opportunities to mitigate substantial pandemic-related reductions in regular operations for the US Department of Defense and commercial passenger customers to achieve strong revenue and earnings growth on an adjusted basis for the second quarter.
“Air cargo operations expanded with the deployment of one Boeing 767-300 freighter leased to Amazon and operated by Air Transport International, the first under a new order for twelve with the remaining eleven scheduled for lease to Amazon during 2021.
“We now expect to lease twelve 767-300 freighters in 2020 to external customers, up from the previous guidance of eight to ten.”
Looking into the group's divisional performances in the first-half, cargo aircraft management (CAM), achieved a 7% increase in revenues to $149m. Ebit (segment earnings, pretax) climbed 8% to $35.5m.
ATSG said its CAM revenues benefited primarily from seven 767 freighters that have been deployed since June last year.
ATSG's CAM also purchased seven 767 feedstock aircraft for freighter modification and lease deployment during the first-half.
ATSG explained: “It [CAM] expects to purchase four more in the second half. CAM has committed to purchase only three 767-300 aircraft in 2021”.
During the second quarter alone, ATSG's CAM division experienced an 8% year-on-year increase in revenues to $75m, while ebit rose 17% to $19.6m.
ATSG's aircraft, crew, maintenance and insurance (ACMI) division posted an 11% year-on-year increase in revenues to $572m.
The company attributed this increase to “charter assignments for Omni Air from the federal government, and expanded air express network flying” including special flights to bring US citizens home during the pandemic.
In the second quarter of this year alone, ATSG's ACMI revenues increased 25% to $254,938. Ebit was $19.7m versus $1.m a year ago.
ATSG added that its ACMI total block hours increased 17% for the second quarter versus a year ago, principally due to more aircraft in service and expanded route commitments from Amazon.
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