Atlas says Southern to begin flying 2 Amazon 737-800Fs this month

Atlas Air Worldwide’s Southern Air subsidiary will begin flying two 737-800Fs on a CMI basis for Amazon Air this month, Atlas President and CEO Bill Flynn said today during the company’s first quarter 2019 earnings call. Those two aircraft are among five that Southern Air will begin flying for Amazon this year, and potentially among twenty total 737-800Fs that Amazon may elect to add by May 2021. In addition to the Amazon 737Fs, Flynn highlighted an additional expansion of Atlas’ CMI business during the call – the takeover of operations of three Nippon Cargo Airlines 747-400Fs on a CMI basis. Atlas took delivery of the first of those aircraft last month , and the second and third are expected to enter CMI service with Atlas in July and September of this year. On the earnings side, Atlas reported a loss of $29.7 million for 1Q19, down from net income of $9.6 million a year earlier, which the company attributed to an unrealized loss on outstanding warrants of $46.6 million. However, revenues and total block hours both increased, by 15.2% to $680 million and 15.9% to 77,061, respectively. The increases were supported by Atlas’ growing operating fleet, which reached 110.7 aircraft in 1Q19 compared to 94.1 during 1Q18. Meanwhile, despite a slow start to 2019 compared to 2018, Flynn was optimistic regarding the second half of 2019, stating during the call that compared to the unusually strong performance during 1Q18, “this year’s first quarter looks more typical to prior years.” Although industry organizations including IATA have revised their forecasts for 2019 down, he added that “with our fleet, it’s predominantly deployed in e-commerce and express, and both are growing at higher rates than the market average.” Looking at the results by operating segment: ACMI (including CMI): ACMI block hours increased by 19.9% to 59,780 during 1Q, and ACMI average utilization in block hours per day also increased by 2.4% to 8.6. Operating revenues rose 15.1% to $307 million, but revenue per block hour for the segment declined 4.0%. Increases in 767 and 777 flying during the quarter were more than offset by higher crew costs, the company said. Later this year, Atlas’ ACMI or Charter segment may receive a boost from an additional 767-300 aircraft that is currently in conversion and scheduled for redelivery this summer. During the call, the company said the freighter will go into either ACMI or charter operation. Charter: Atlas’ cargo charter block hours were virtually flat, increasing only 0.8% from 1Q18 to 11,479, as average utilization in block hours per day fell by 17.5% to 8.0. Operating revenues were up 7.0% to $305 million, while the direct contribution from the segment fell 15.0%. Atlas attributed the decline to a decrease in military cargo flying as well as non-heavy maintenance and repairs. Dry leasing: The dry leasing segment posted the strongest year-over-year gains among Atlas’ operating segments, as operating revenues grew by 92.2% to $70 million, and the direct contribution more than tripled to $36 million. However, the strikingly good performance of the segment was due to what Flynn called an “infrequently occurring item,” as a 777F returned off lease as scheduled in March contributed maintenance payments to the segment. Though Atlas did not name the customer, Cargo Facts believes this is the 777F previously leased by Emirates SkyCargo (35606).

Atlas says Southern to begin flying 2 Amazon 737-800Fs this month

RedCargo, Oman Air to share Southeast Asian, EMEA connections

The Silicon Solution? How robots are reinventing the cargo warehouse

Related Posts

Challenge Group launches engine dolly at LGG

New de minimis executive action targets Chinese retailers

CVC willing to bump DB Schenker bid after losing to DSV

The Silicon Solution? How robots are reinventing the cargo warehouse

Cargo Facts Free Newsletters

Cargo Facts Connect Podcast

Follow Us

Welcome Back!

Retrieve your password