ACMI specialist, Atlas Air Worldwide Holdings posted 2016 second-quarter net income of US$20.6 million, down 27.5 per cent from the $28.4 million net profit the company reported a year earlier. The drop is a result of the group’s preparation for its contract with e-commerce giant, Amazon, to operate 20 freighters on its behalf.
US-based Atlas Air Worldwide is parent company to Atlas Air, Southern Air Holdings and Titan Aviation Holdings, and majority owner of Polar Air Cargo.
“The second quarter was one of the most important in the company’s history,” Atlas Air Worldwide Holdings president and CEO William Flynn said in reference to its acquisition of Southern Air and the agreement to lease and operate 20 B767-300s on behalf of Amazon.
“Our acquisition of Southern Air in early April and the addition of its express-focused B777 and B737 CMI services generated immediate earnings accretion in the second quarter,” Flynn added.
Atlas Air Worldwide Holdings’ consolidated revenue was down 2.8 per cent year-on-year to $443.3 million, reflecting an increase in military cargo and passenger demand but a slower pace in general commercial cargo demand, the group said. Second-quarter expenses rose 7.1 per cent year-on-year to $422.4 million, however, as a direct result of the start-up expenses associated with the company’s B767 service agreement with Amazon.
“We expect to place our first aircraft into service for Amazon soon in this quarter,” Flynn said “We have secured all of the conversion slots and the vast majority of the feedstock aircraft required to support 20 767-300s for Amazon by the end of 2018.”
The company’s operating profit for the quarter was $20.8 million, a significant drop of 66 per cent from operating income of $61.2 million in the 2015 second quarter. The company’s total block hours flown in the 2Q rose 19.1 per cento 53,312.