Atlas Air sees financial growth, but downgrades EPS forecast
Atlas Air Worldwide posted strong financial growth in the third quarter of 2012, with reported net income and revenue surging 20 percent and 13 percent, year-over-year, respectively. Despite these increases, the company downgraded its 2012 earnings-per-share forecast from more than $5.10 a share to $4.65 a share. Atlas Air CEO William Flynn blamed the “relative underperformance of the airfreight market” on this revision.
Even so, Flynn called the company’s third-quarter performance impressive. “In an airfreight market that has underperformed expectations this year, and in the face of a marked decline in military cargo demand, we are executing on our strategic growth plan that leverages our core competencies and underscores our ability to perform well in all economic conditions,” he said in a statement.
Atlas Air’s core ACMI sector performed particularly well in the quarter ending September 30. In a press release, the company attributed the acquisition of Boeing 747-8F aircraft and the fact that customers flew 5.2-percent above contractual minimums with the 9-percent, year-over-year, revenue increase the segment netted in the third quarter.
Flynn also has an optimistic view of airfreight moving forward, despite the carrier’s profit downgrade. “High-tech products, automotive and manufactured goods, pharmaceuticals, fresh foods and other perishables are moving, and airfreight remains vital,” he said in a statement. “It is never a smooth, straight line, but airfreight will continue to grow from today’s near-record global tonnages.”
As evidence of this optimism, Flynn announced at last month's TIACA Air Cargo Forum that Atlas Air is increasing capacity by 18 percent this year, a trend that will continue into 2013. He said that demand is coming from the growing population of global consumers — especially from Southeast Asia — and the increased sophistication of consumers.