- Quarterly Revenue Exceeded
$1.0 Billion - Reported Net Income Increased to
$119.5 Million - Adjusted EBITDA Grew to
$280.5 Million - Adjusted Net Income Increased to
$145.4 Million - Expect Record Fourth Quarter
On an adjusted basis, EBITDA grew sharply to
“We delivered outstanding financial and operating results in the third quarter. We flew over 90,000 block hours and generated quarterly revenue that exceeded
“Our strategic focus on express, e-commerce and fast-growing global markets is driving robust demand for our services and producing strong financial performance. In a very challenging pandemic operating environment, our team pulled together to increase utilization of our aircraft, and safely serve our customers and the global supply chain.
“We recently announced long-term contract extensions for 20 aircraft with
“As we served the needs of our customers and their businesses, we were also extremely proud to support the
“We are operating in a very strong airfreight market, and we expect industry conditions to remain favorable for the foreseeable future. Global airfreight volumes continue to exceed pre-pandemic levels, while industry capacity, particularly on long-haul international routes, has not kept pace with demand. Supply chain bottlenecks, including the widely reported challenges at ocean ports worldwide, are driving increased modal shift to air as manufacturers, retailers and shippers strive to replenish very low inventory levels, especially ahead of the holiday shopping season. This current environment has also led to a structural acceleration of express growth and e-commerce adoption, which will drive both current and longer-term airfreight demand.”
He concluded: “We expect record revenue and adjusted earnings in the fourth quarter of 2021, with revenue of nearly
“This outlook includes the impact of our new joint collective bargaining agreement and our proactive initiatives to help mitigate the higher costs of the new agreement. It also reflects the increased contribution of numerous new and extended long-term customer agreements, high levels of aircraft utilization driven by strong customer demand, and solid peak-season volumes and yields.”
Third-Quarter Results
Volumes in the third quarter of 2021 totaled 90,363 block hours compared with 90,528 in the third quarter of 2020, with revenue rising to a record
Higher Airline Operations revenue primarily reflected an increase in the average rate per block hour. The higher average rate per block hour was primarily due to an increased proportion of higher-yielding flying, including the impact of new and extended long-term contracts, the ongoing reduction of available cargo capacity in the market, the continued disruption of global supply chains due to the pandemic, as well as higher fuel costs. Block-hour volumes during the period were relatively unchanged as we reduced less profitable smaller gauge CMI service flying, while increasing utilization of our current fleet to meet strong customer demand. Block-hour volumes benefited from the operation of a 747-400 freighter we reactivated during the fourth quarter of 2020 as well as increased AMC passenger Charter flying related to
Higher Airline Operations segment contribution in the third quarter of 2021 was primarily driven by the positive factors benefiting segment revenue mentioned above as well as lower heavy maintenance expense. These improvements were partially offset by higher pilot costs related to our new joint collective bargaining agreement (JCBA).
In
Unallocated income and expenses, net, increased during the quarter, primarily due to
Reported earnings in the third quarter of 2021 also included an effective income tax rate of 23.4%. On an adjusted basis, our results reflected an effective income tax rate of 22.3%.
Cash
At
The change in position, which reflects significant pre-delivery payments for our new 747-8F aircraft, resulted from cash used for investing and financing activities, partially offset by cash provided by operating activities.
Net cash used for investing activities during the first nine months of 2021 primarily related to capital expenditures and payments for flight equipment and modifications, including pre-delivery payments for 747-8F aircraft, spare engines, GEnx engine overhauls and performance upgrade kits.
Net cash used for financing activities during the period primarily related to payments on debt obligations, partially offset by proceeds from debt issuance.
Nine-Month Results
Reported results for the nine months ended
On an adjusted basis, EBITDA grew to
Fleet Management
As previously announced, we acquired three of our existing 747-400Fs between May and
Acquiring these eleven aircraft underscores our confidence in the demand for widebody freighters and will provide strong returns for Atlas in the years ahead.
Labor
As previously disclosed, we reached a new five-year JCBA with our
Outlook*
We are very proud of our performance during the first nine months of 2021, and we are continuing to see strong business conditions in the fourth quarter. Subject to any material COVID-19 or other developments, we anticipate solid peak-season volumes and yields, reflecting strong global demand for our aircraft and services.
As a result, we expect the fourth quarter of 2021 to have the highest quarterly revenue and adjusted earnings in the company’s history, with revenue of nearly
This outlook includes the impact of our new JCBA, as well as our proactive initiatives to help mitigate the higher costs from the new agreement. It also reflects the increased contribution of numerous new and extended long-term customer agreements, as well as our expectation of continued high levels of aircraft utilization.
We expect fourth-quarter results to continue to be impacted by ongoing pandemic-related expenses, including premium pay for employees flying into certain locations significantly impacted by COVID-19 and other operational costs for providing a safe working environment for our employees.
For the full year in 2021, we expect aircraft maintenance expense to total approximately
Other than with regard to revenue, we provide guidance only on an adjusted basis because we are unable to predict, with reasonable certainty and without unreasonable effort, the effects of 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 third-quarter 2021 financial and operating results at
Interested parties may listen to the call live at Atlas Air Worldwide’s Investor site or at https://edge.media-server.com/mmc/p/gtuvu4m3.
For those unable to listen to the live call, a replay will be archived on our Investor site following the call. A replay will also be available through
About Non-GAAP Financial Measures
To supplement our financial statements presented in accordance with
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
- 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
About
Atlas Air Worldwide’s press releases,
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,” “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
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; our ability to coordinate with Amazon to accept newly converted aircraft; 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
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
Except as stated in this release,
Consolidated Statements of Operations
(in thousands, except per share data)
(Unaudited)
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||||||
Operating Revenue | $ | 1,016,100 | $ | 809,886 | $ | 2,867,832 | $ | 2,278,641 | ||||||||||||
Operating Expenses | ||||||||||||||||||||
Salaries, wages and benefits | 231,437 | 194,265 | 642,417 | 534,600 | ||||||||||||||||
Aircraft fuel | 216,638 | 118,113 | 594,458 | 309,673 | ||||||||||||||||
Maintenance, materials and repairs | 102,819 | 116,634 | 356,499 | 379,086 | ||||||||||||||||
Depreciation and amortization | 73,468 | 65,595 | 207,918 | 189,005 | ||||||||||||||||
Navigation fees, landing fees and other rent | 46,622 | 42,870 | 138,918 | 109,909 | ||||||||||||||||
Passenger and ground handling services | 40,268 | 36,266 | 121,837 | 98,355 | ||||||||||||||||
Travel | 42,966 | 37,731 | 120,585 | 114,749 | ||||||||||||||||
Aircraft rent | 15,485 | 24,239 | 53,928 | 72,522 | ||||||||||||||||
Gain on disposal of aircraft | (810 | ) | (163 | ) | (794 | ) | (6,878 | ) | ||||||||||||
Special charge | - | 547 | - | 16,481 | ||||||||||||||||
Transaction-related expenses | 168 | 490 | 486 | 2,286 | ||||||||||||||||
Other | 63,106 | 54,107 | 183,366 | 157,929 | ||||||||||||||||
Total Operating Expenses | 832,167 | 690,694 | 2,419,618 | 1,977,717 | ||||||||||||||||
Operating Income | 183,933 | 119,192 | 448,214 | 300,924 | ||||||||||||||||
Non-operating Expenses (Income) | ||||||||||||||||||||
Interest income | (159 | ) | (225 | ) | (559 | ) | (929 | ) | ||||||||||||
Interest expense | 27,173 | 28,524 | 81,345 | 86,749 | ||||||||||||||||
Capitalized interest | (2,335 | ) | (203 | ) | (5,456 | ) | (528 | ) | ||||||||||||
Loss on early extinguishment of debt | - | 7 | - | 81 | ||||||||||||||||
Unrealized loss on financial instruments | - | 43,604 | 113 | 73,351 | ||||||||||||||||
Other (income) expense, net | 3,136 | (62,689 | ) | (41,174 | ) | (112,081 | ) | |||||||||||||
Total Non-operating Expenses (Income) | 27,815 | 9,018 | 34,269 | 46,643 | ||||||||||||||||
Income before income taxes | 156,118 | 110,174 | 413,945 | 254,281 | ||||||||||||||||
Income tax expense | 36,583 | 36,120 | 97,367 | 77,962 | ||||||||||||||||
Net Income | $ | 119,535 | $ | 74,054 | $ | 316,578 | $ | 176,319 | ||||||||||||
Earnings per share: | ||||||||||||||||||||
Basic | $ | 4.12 | $ | 2.83 | $ | 10.98 | $ | 6.76 | ||||||||||||
Diluted | $ | 3.91 | $ | 2.78 | $ | 10.52 | $ | 6.72 | ||||||||||||
Weighted average shares: | ||||||||||||||||||||
Basic | 29,023 | 26,135 | 28,844 | 26,077 | ||||||||||||||||
Diluted | 30,547 | 26,619 | 30,117 | 26,256 | ||||||||||||||||
Consolidated Balance Sheets
(in thousands, except share data)
(Unaudited)
Assets | ||||||||
Current Assets | ||||||||
Cash and cash equivalents | $ | 773,911 | $ | 845,589 | ||||
Restricted cash | 10,230 | 10,692 | ||||||
Accounts receivable, net of allowance of | 283,362 | 265,521 | ||||||
Prepaid expenses, assets held for sale and other current assets | 88,330 | 95,919 | ||||||
Total current assets | 1,155,833 | 1,217,721 | ||||||
Property and Equipment | ||||||||
Flight equipment | 5,435,345 | 5,061,387 | ||||||
Ground equipment | 99,769 | 86,670 | ||||||
Less: accumulated depreciation | (1,290,928 | ) | (1,147,613 | ) | ||||
Flight equipment purchase deposits and modifications in progress | 289,475 | 110,150 | ||||||
Property and equipment, net | 4,533,661 | 4,110,594 | ||||||
Other Assets | ||||||||
Operating lease right-of-use assets | 158,387 | 255,805 | ||||||
Deferred costs and other assets | 350,759 | 374,242 | ||||||
Intangible assets, net and goodwill | 66,303 | 70,826 | ||||||
Total Assets | $ | 6,264,943 | $ | 6,029,188 | ||||
Liabilities and Equity | ||||||||
Current Liabilities | ||||||||
Accounts payable | $ | 92,708 | $ | 107,604 | ||||
Accrued liabilities | 591,208 | 583,160 | ||||||
Current portion of long-term debt and finance leases | 703,650 | 298,690 | ||||||
Current portion of long-term operating leases | 56,670 | 157,732 | ||||||
Total current liabilities | 1,444,236 | 1,147,186 | ||||||
Other Liabilities | ||||||||
Long-term debt and finance leases | 1,669,248 | 2,020,451 | ||||||
Long-term operating leases | 191,604 | 318,850 | ||||||
Deferred taxes | 297,472 | 203,586 | ||||||
Financial instruments and other liabilities | 38,119 | 77,576 | ||||||
Total other liabilities | 2,196,443 | 2,620,463 | ||||||
Commitments and contingencies | ||||||||
Equity | ||||||||
Stockholders’ Equity | ||||||||
Preferred stock, | - | - | ||||||
Common stock, | 345 | 329 | ||||||
Additional paid-in-capital | 926,853 | 873,874 | ||||||
(225,327 | ) | (217,889 | ) | |||||
Accumulated other comprehensive loss | (1,314 | ) | (1,904 | ) | ||||
Retained earnings | 1,923,707 | 1,607,129 | ||||||
Total stockholders’ equity | 2,624,264 | 2,261,539 | ||||||
Total Liabilities and Equity | $ | 6,264,943 | $ | 6,029,188 | ||||
1 Balance sheet debt at
2 The face value of our debt at
Consolidated Statements of Cash Flows
(in thousands)
(Unaudited)
For the Nine Months Ended | ||||||||
Operating Activities: | ||||||||
Net Income | $ | 316,578 | $ | 176,319 | ||||
Adjustments to reconcile Net Income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 265,231 | 240,826 | ||||||
Accretion of debt securities discount | - | (2 | ) | |||||
Provision for (reversal of) expected credit losses | (377 | ) | 76 | |||||
Loss on early extinguishment of debt | - | 81 | ||||||
Special charge, net of cash payments | - | 16,481 | ||||||
Unrealized loss on financial instruments | 113 | 73,351 | ||||||
Gain on disposal of aircraft | (794 | ) | (6,878 | ) | ||||
Deferred taxes | 96,053 | 75,331 | ||||||
Stock-based compensation | 10,653 | 15,816 | ||||||
Changes in: | ||||||||
Accounts receivable | (15,785 | ) | 23,072 | |||||
Prepaid expenses, current assets and other assets | (43,297 | ) | (39,823 | ) | ||||
Accounts payable, accrued liabilities and other liabilities | (19,442 | ) | 208,058 | |||||
Net cash provided by operating activities | 608,933 | 782,708 | ||||||
Investing Activities: | ||||||||
Capital expenditures | (64,132 | ) | (45,134 | ) | ||||
(346,028 | ) | (102,777 | ) | |||||
Investment in joint ventures | (2,424 | ) | - | |||||
Proceeds from investments | - | 881 | ||||||
Proceeds from disposal of aircraft | 9,470 | 45,660 | ||||||
Net cash used for investing activities | (403,114 | ) | (101,370 | ) | ||||
Financing Activities: | ||||||||
Proceeds from debt issuance | 23,948 | 401,419 | ||||||
Payment of debt issuance costs | (1,274 | ) | (5,172 | ) | ||||
Payments of debt and finance lease obligations | (271,078 | ) | (353,795 | ) | ||||
Proceeds from revolving credit facility | - | 75,000 | ||||||
Payment of revolving credit facility | - | (175,000 | ) | |||||
Customer maintenance reserves and deposits received | 13,491 | 10,465 | ||||||
Customer maintenance reserves paid | (35,608 | ) | (14,437 | ) | ||||
(7,438 | ) | (3,915 | ) | |||||
Net cash used for financing activities | (277,959 | ) | (65,435 | ) | ||||
Net increase (decrease) in cash, cash equivalents and restricted cash | (72,140 | ) | 615,903 | |||||
Cash, cash equivalents and restricted cash at the beginning of period | 856,281 | 113,430 | ||||||
Cash, cash equivalents and restricted cash at the end of period | $ | 784,141 | $ | 729,333 | ||||
Noncash Investing and Financing Activities: | ||||||||
Acquisition of property and equipment included in Accounts payable and accrued liabilities | $ | 16,802 | $ | 11,357 | ||||
Acquisition of property and equipment acquired under operating leases | $ | 9,661 | $ | 2,486 | ||||
Acquisition of flight equipment under finance leases | $ | 191,913 | $ | 17,035 | ||||
Customer maintenance reserves settled with sale of aircraft | $ | - | $ | 6,497 | ||||
Issuance of shares related to settlement of warrant liability | $ | 31,582 | $ | - | ||||
Direct Contribution
(in thousands)
(Unaudited)
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
Operating Revenue: | ||||||||||||||||
Airline Operations | $ | 980,714 | $ | 773,591 | $ | 2,762,815 | $ | 2,169,462 | ||||||||
40,926 | 40,740 | 121,694 | 123,572 | |||||||||||||
Customer incentive asset amortization | (11,332 | ) | (9,858 | ) | (33,256 | ) | (28,414 | ) | ||||||||
Other | 5,792 | 5,413 | 16,579 | 14,021 | ||||||||||||
Total Operating Revenue | $ | 1,016,100 | $ | 809,886 | $ | 2,867,832 | $ | 2,278,641 | ||||||||
Direct Contribution: | ||||||||||||||||
Airline Operations | $ | 265,260 | $ | 179,441 | $ | 666,203 | $ | 482,995 | ||||||||
10,435 | 9,627 | 31,765 | 30,046 | |||||||||||||
Total Direct Contribution for Reportable Segments | 275,695 | 189,068 | 697,968 | 513,041 | ||||||||||||
Unallocated income and (expenses), net | (120,219 | ) | (34,409 | ) | (284,218 | ) | (173,439 | ) | ||||||||
Loss on early extinguishment of debt | - | (7 | ) | - | (81 | ) | ||||||||||
Unrealized loss on financial instruments | - | (43,604 | ) | (113 | ) | (73,351 | ) | |||||||||
Special charge | - | (547 | ) | - | (16,481 | ) | ||||||||||
Transaction-related expenses | (168 | ) | (490 | ) | (486 | ) | (2,286 | ) | ||||||||
Gain on disposal of aircraft | 810 | 163 | 794 | 6,878 | ||||||||||||
Income before income taxes | 156,118 | 110,174 | 413,945 | 254,281 | ||||||||||||
Add back (subtract): | ||||||||||||||||
Interest income | (159 | ) | (225 | ) | (559 | ) | (929 | ) | ||||||||
Interest expense | 27,173 | 28,524 | 81,345 | 86,749 | ||||||||||||
Capitalized interest | (2,335 | ) | (203 | ) | (5,456 | ) | (528 | ) | ||||||||
Loss on early extinguishment of debt | - | 7 | - | 81 | ||||||||||||
Unrealized loss on financial instruments | - | 43,604 | 113 | 73,351 | ||||||||||||
Other (income) expense, net | 3,136 | (62,689 | ) | (41,174 | ) | (112,081 | ) | |||||||||
Operating Income | $ | 183,933 | $ | 119,192 | $ | 448,214 | $ | 300,924 | ||||||||
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 aircraft, 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.
Reconciliation to Non-GAAP Measures
(in thousands, except per share data)
(Unaudited)
For the Three Months Ended | ||||||||||
Percent Change | ||||||||||
Net Income | $ | 119,535 | $ | 74,054 | 61.4 | % | ||||
Impact from: | ||||||||||
CARES Act grant income1 | - | (64,211 | ) | |||||||
Customer incentive asset amortization | 11,332 | 9,858 | ||||||||
Adjustments to JCBA paid time-off benefits2 | 15,150 | - | ||||||||
Special charge | - | 547 | ||||||||
Noncash expenses and income, net3 | 4,821 | 4,527 | ||||||||
Unrealized loss on financial instruments | - | 43,604 | ||||||||
Other, net4 | (204 | ) | 2,638 | |||||||
Income tax effect of reconciling items | (5,189 | ) | 11,731 | |||||||
Adjusted Net Income | $ | 145,445 | $ | 82,748 | 75.8 | % | ||||
Weighted average diluted shares outstanding | 30,547 | 26,619 | ||||||||
Add: dilutive warrant | - | 2,478 | ||||||||
effect of convertible notes hedges5 | (717 | ) | - | |||||||
Adjusted weighted average diluted shares outstanding | 29,830 | 29,097 | ||||||||
Adjusted Diluted EPS | $ | 4.88 | $ | 2.84 | 71.8 | % | ||||
For the Nine Months Ended | ||||||||||
Percent Change | ||||||||||
Net Income | $ | 316,578 | $ | 176,319 | 79.5 | % | ||||
Impact from: | ||||||||||
CARES Act grant income1 | (40,944 | ) | (84,378 | ) | ||||||
Customer incentive asset amortization | 33,256 | 28,414 | ||||||||
Adjustments to JCBA paid time-off benefits2 | 15,150 | - | ||||||||
Special charge | - | 16,481 | ||||||||
Noncash expenses and income, net3 | 14,239 | 13,372 | ||||||||
Unrealized loss on financial instruments | 113 | 73,351 | ||||||||
Other, net6 | 821 | 2,088 | ||||||||
Income tax effect of reconciling items | 222 | 10,170 | ||||||||
Adjusted Net Income | $ | 339,435 | $ | 235,817 | 43.9 | % | ||||
Weighted average diluted shares outstanding | 30,117 | 26,256 | ||||||||
Add: dilutive warrant | - | 826 | ||||||||
effect of convertible notes hedges5 | (442 | ) | - | |||||||
Adjusted weighted average diluted shares outstanding | 29,675 | 27,082 | ||||||||
Adjusted Diluted EPS | $ | 11.44 | $ | 8.71 | 31.3 | % | ||||
Reconciliation to Non-GAAP Measures
(in thousands, except per share data)
(Unaudited)
For the Three Months Ended | ||||||||||
Percent Change | ||||||||||
Income before taxes | $ | 156,118 | $ | 110,174 | 41.7 | % | ||||
Impact from: | ||||||||||
CARES Act grant income1 | - | (64,211 | ) | |||||||
Customer incentive asset amortization | 11,332 | 9,858 | ||||||||
Adjustments to JCBA paid time-off benefits2 | 15,150 | - | ||||||||
Special charge | - | 547 | ||||||||
Noncash expenses and income, net3 | 4,821 | 4,527 | ||||||||
Unrealized loss on financial instruments | - | 43,604 | ||||||||
Other, net4 | (204 | ) | 2,638 | |||||||
Adjusted income before income taxes | 187,217 | 107,137 | 74.7 | % | ||||||
Interest (income) expense, net | 19,858 | 23,569 | ||||||||
Other (income) expense, net | 3,136 | 1,522 | ||||||||
Adjusted operating income | $ | 210,211 | $ | 132,228 | 59.0 | % | ||||
Income tax expense | $ | 36,583 | $ | 36,120 | ||||||
Income tax effect of reconciling items | (5,189 | ) | 11,731 | |||||||
Adjusted income tax expense | 41,772 | 24,389 | ||||||||
Adjusted income before income taxes | $ | 187,217 | $ | 107,137 | ||||||
Effective tax expense rate | 23.4 | % | 32.8 | % | ||||||
Adjusted effective tax expense rate | 22.3 | % | 22.8 | % | ||||||
For the Nine Months Ended | ||||||||||
Percent Change | ||||||||||
Income before taxes | $ | 413,945 | $ | 254,281 | 62.8 | % | ||||
Impact from: | ||||||||||
CARES Act grant income1 | (40,944 | ) | (84,378 | ) | ||||||
Customer incentive asset amortization | 33,256 | 28,414 | ||||||||
Adjustments to JCBA paid time-off benefits2 | 15,150 | - | ||||||||
Special charge | - | 16,481 | ||||||||
Noncash expenses and income, net3 | 14,239 | 13,372 | ||||||||
Unrealized loss on financial instruments | 113 | 73,351 | ||||||||
Other, net6 | 821 | 2,088 | ||||||||
Adjusted income before income taxes | 436,580 | 303,609 | 43.8 | % | ||||||
Interest (income) expense, net | 61,091 | 71,922 | ||||||||
Other (income) expense, net | (230 | ) | (27,703 | ) | ||||||
Adjusted operating income | $ | 497,441 | $ | 347,828 | 43.0 | % | ||||
Income tax expense | $ | 97,367 | $ | 77,962 | ||||||
Income tax effect of reconciling items | 222 | 10,170 | ||||||||
Adjusted income tax expense | 97,145 | 67,792 | ||||||||
Adjusted income before income taxes | $ | 436,580 | $ | 303,609 | ||||||
Effective tax expense rate | 23.5 | % | 30.7 | % | ||||||
Adjusted effective tax expense rate | 22.3 | % | 22.3 | % | ||||||
Reconciliation to Non-GAAP Measures
(in thousands, except per share data)
(Unaudited)
For the Three Months Ended | ||||||||||
Percent Change | ||||||||||
Net Income | $ | 119,535 | $ | 74,054 | 61.4 | % | ||||
Interest expense, net | 24,679 | 28,096 | ||||||||
Depreciation and amortization | 73,468 | 65,595 | ||||||||
Income tax expense | 36,583 | 36,120 | ||||||||
EBITDA | 254,265 | 203,865 | ||||||||
CARES Act grant income1 | - | (64,211 | ) | |||||||
Customer incentive asset amortization | 11,332 | 9,858 | ||||||||
Adjustments to JCBA paid time-off benefits2 | 15,150 | - | ||||||||
Special charge | - | 547 | ||||||||
Unrealized loss on financial instruments | - | 43,604 | ||||||||
Other, net4 | (204 | ) | 2,638 | |||||||
Adjusted EBITDA | $ | 280,543 | $ | 196,301 | 42.9 | % | ||||
For the Nine Months Ended | ||||||||||
Percent Change | ||||||||||
Net Income | $ | 316,578 | $ | 176,319 | 79.5 | % | ||||
Interest expense, net | 75,330 | 85,292 | ||||||||
Depreciation and amortization | 207,918 | 189,005 | ||||||||
Income tax expense | 97,367 | 77,962 | ||||||||
EBITDA | 697,193 | 528,578 | ||||||||
CARES Act grant income1 | (40,944 | ) | (84,378 | ) | ||||||
Customer incentive asset amortization | 33,256 | 28,414 | ||||||||
Adjustments to JCBA paid time-off benefits2 | 15,150 | - | ||||||||
Special charge | - | 16,481 | ||||||||
Unrealized loss on financial instruments | 113 | 73,351 | ||||||||
Other, net6 | 821 | 2,088 | ||||||||
Adjusted EBITDA | $ | 705,589 | $ | 564,534 | 25.0 | % | ||||
1 CARES Act grant income in 2021 and 2020 related to income associated with the Payroll Support Program.
2 Adjustments to JCBA paid time-off benefits in 2021 are related to our new JCBA.
3 Noncash expenses and income, net in 2021 and 2020 primarily related to amortization of debt discount on the convertible notes.
4 Other, net in 2021 primarily related to gain on the sale of aircraft partially offset by leadership transition costs. Other, net in 2020 primarily related to leadership transition costs and costs associated with our acquisition of
5 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.
6 Other, net in 2021 primarily related to leadership transition costs and costs associated with our acquisition of
Reconciliation to Non-GAAP Measures
(in thousands, except per share data)
(Unaudited)
For the Three Months Ended | |||||
Net Cash Provided by Operating Activities | $ | 265,827 | $ | 222,318 | |
Less: | |||||
Capital expenditures | 20,773 | 20,039 | |||
Capitalized interest | 2,335 | 203 | |||
Free Cash Flow1 | $ | 242,719 | $ | 202,076 | |
For the Nine Months Ended | |||||
Net Cash Provided by Operating Activities | $ | 608,933 | $ | 782,708 | |
Less: | |||||
Capital expenditures | 64,132 | 45,134 | |||
Capitalized interest | 5,456 | 528 | |||
Free Cash Flow1 | $ | 539,345 | $ | 737,046 | |
1 Free Cash Flow =
Core Capital Expenditures excludes purchases of aircraft.
Operating Statistics and Traffic Results
(Unaudited)
For the Three Months Ended | Increase/ | For the Nine Months Ended | Increase/ | |||||||||||||||||||||
(Decrease) | (Decrease) | |||||||||||||||||||||||
Airline Operations | 89,624 | 88,973 | 651 | 268,770 | 245,133 | 23,637 | ||||||||||||||||||
Cargo | 84,512 | 84,435 | 77 | 255,296 | 232,681 | 22,615 | ||||||||||||||||||
Passenger | 5,112 | 4,538 | 574 | 13,474 | 12,452 | 1,022 | ||||||||||||||||||
Other | 739 | 1,555 | (816 | ) | 3,306 | 3,609 | (303 | ) | ||||||||||||||||
Total | 90,363 | 90,528 | (165 | ) | 272,076 | 248,742 | 23,334 | |||||||||||||||||
Revenue Per Block Hour | ||||||||||||||||||||||||
Airline Operations | $ | 10,943 | $ | 8,695 | $ | 2,248 | $ | 10,279 | $ | 8,850 | $ | 1,429 | ||||||||||||
Cargo | $ | 10,383 | $ | 8,211 | $ | 2,172 | $ | 9,809 | $ | 8,355 | $ | 1,454 | ||||||||||||
Passenger | $ | 20,187 | $ | 17,687 | $ | 2,500 | $ | 19,187 | $ | 18,107 | $ | 1,080 | ||||||||||||
Average Utilization (block hours per day) | ||||||||||||||||||||||||
Airline Operations | ||||||||||||||||||||||||
Cargo | 10.7 | 9.8 | 0.9 | 10.5 | 8.9 | 1.6 | ||||||||||||||||||
Passenger | 5.6 | 4.6 | 1.0 | 4.9 | 4.2 | 0.7 | ||||||||||||||||||
All Operating Aircraft1 | 10.2 | 9.4 | 0.8 | 10.1 | 8.6 | 1.5 | ||||||||||||||||||
Fuel | ||||||||||||||||||||||||
Charter | ||||||||||||||||||||||||
Average fuel cost per gallon | $ | 2.06 | $ | 1.35 | $ | 0.71 | $ | 1.90 | $ | 1.42 | $ | 0.48 | ||||||||||||
Fuel gallons consumed (000s) | 105,258 | 87,460 | 17,798 | 312,662 | 217,507 | 95,155 | ||||||||||||||||||
1 Average of All Operating Aircraft excludes
Operating Statistics and Traffic Results
(Unaudited)
For the Three Months Ended | Increase/ | For the Nine Months Ended | Increase/ | ||||||||||||||
(Decrease) | (Decrease) | ||||||||||||||||
Segment Operating Fleet (average aircraft equivalents during the period) | |||||||||||||||||
Airline Operations1 | |||||||||||||||||
747-8F Cargo | 10.0 | 10.0 | - | 10.0 | 9.9 | 0.1 | |||||||||||
747-400 Cargo | 34.6 | 32.9 | 1.7 | 34.3 | 32.2 | 2.1 | |||||||||||
747-400 Dreamlifter | 0.6 | 2.7 | (2.1 | ) | 1.0 | 2.7 | (1.7 | ) | |||||||||
747-400 Passenger | 5.1 | 5.0 | 0.1 | 5.0 | 5.0 | - | |||||||||||
777-200 Cargo | 9.0 | 9.0 | - | 9.0 | 8.5 | 0.5 | |||||||||||
767-300 Cargo | 24.0 | 24.0 | - | 24.0 | 24.0 | - | |||||||||||
767-300 Passenger | 4.9 | 4.8 | 0.1 | 4.9 | 4.8 | 0.1 | |||||||||||
767-200 Cargo | - | 9.0 | (9.0 | ) | 2.7 | 9.0 | (6.3 | ) | |||||||||
767-200 Passenger | - | 1.0 | (1.0 | ) | 0.2 | 1.0 | (0.8 | ) | |||||||||
737-800 Cargo | 8.0 | 5.5 | 2.5 | 8.0 | 5.2 | 2.8 | |||||||||||
737-400 Cargo | - | 0.8 | (0.8 | ) | - | 3.5 | (3.5 | ) | |||||||||
Total | 96.2 | 104.7 | (8.5 | ) | 99.1 | 105.8 | (6.7 | ) | |||||||||
777-200 Cargo | 7.0 | 7.0 | - | 7.0 | 7.0 | - | |||||||||||
767-300 Cargo | 21.0 | 21.0 | - | 21.0 | 21.0 | - | |||||||||||
757-200 Cargo | - | - | - | - | 0.2 | (0.2 | ) | ||||||||||
737-300 Cargo | 1.0 | 1.0 | - | 1.0 | 1.0 | - | |||||||||||
737-800 Passenger | - | - | - | - | 0.2 | (0.2 | ) | ||||||||||
Total | 29.0 | 29.0 | - | 29.0 | 29.4 | (0.4 | ) | ||||||||||
Less: Aircraft Dry Leased to CMI customers | (21.0 | ) | (21.0 | ) | - | (21.0 | ) | (21.0 | ) | - | |||||||
Total Operating Average Aircraft Equivalents | 104.2 | 112.7 | (8.5 | ) | 107.1 | 114.2 | (7.1 | ) | |||||||||
Out-of-Service2 | - | 1.0 | (1.0 | ) | - | 2.7 | (2.7 | ) | |||||||||
1 Airline Operations average fleet excludes spare aircraft provided by CMI customers.
2 Out-of-service includes aircraft that are temporarily parked.
Contacts: | Investors – InvestorRelations@atlasair.com Media – CorpCommunications@atlasair.com | |
Source:
2021 GlobeNewswire, Inc., source