ATSG saw revenues increase by 71% in the first quarter of the year thanks its purchase of Omni Air while it expects a further boost from expanded contracts with Amazon and DHL.
The aircraft lessor and operator saw first quarter revenues reach $348m, while earnings from continuing operations increased by $7m to $22.6m and net earnings reached $22.7m compared with $15.9m last year.
ATSG president and chief executive Joe Hete said: "Our acquisition of Omni Air, and recent agreements with our largest commercial customers, Amazon and DHL, add years of contracted revenue streams from aircraft leasing and from operations by our airlines and related service businesses.
“Our customers are focused on transport options that offer optimal combinations of reliability, flexibility, and cost-efficiency, with a particular emphasis on speed.
“In response, we continue to add aircraft options, including the Boeing 777 via Omni, and a converted freighter variant of the Airbus A321-200 aircraft we are developing through our joint venture with Precision.”
Its Cargo Aircraft Management (CAM) division's revenues, net of warrant-related lease incentives, increased 34%.
First quarter revenues benefited from ten more converted freighters in service versus the first quarter of 2018 and a full quarter of revenues from eleven Omni Air passenger aircraft that CAM acquired and leased back to Omni Air in November 2018.
Revenues at its ACMI business more than doubled to $258m, principally due to a $135.8m contribution from Omni Air.
"Our strong 2019 start coupled with recent guidance from our largest customers on their flying requirements for the balance of the year is allowing us to increase our full-year Adjusted EBITDA guidance,” Hete said.
“Along with indications for heavier second-half flying schedules, however, we now project that the $1.5m in ramp-up costs we projected in February will increase to $7m, most of which will be incurred in the second quarter.
“We continue to anticipate leasing at least nine 767 freighters during 2019, including five we have contracted to deploy with Amazon and at least four with United Parcel Service."
