Wednesday April 21, 7:01 am Eastern Time
Company Press Release
Atlas Air Reports Record First-Quarter Results
GOLDEN, Colo.--(BUSINESS WIRE)--April 21, 1999--Atlas Air, Inc. (NYSE:CGO -
news) today reported record first-quarter net income of $10.2 million, or $.30 per fully
diluted share, for the quarter ended March 31, 1999, before previously announced one-time and extraordinary charges, versus
$5.3 million, or $.16 per fully diluted share, for the year-earlier quarter.
Operating income for the first quarter of 1999 was $36.7 million, on revenues of $137.8 million, both records for first-quarter
results. Compared to first-quarter 1998, operating income improved by 71% and revenue improved by 73%. Net income
before one-time and extraordinary charges improved by 92% over first-quarter 1998 results.
''The Company's first-quarter results were impressive, as we delivered strong revenue performance, further improved our
balance sheet and continued to enhance shareholder value,'' said Stephen C. Nevin, Chief Financial Officer. ''Total revenue
per block hour rose to $5,760, up over 11% from a year ago, primarily as a result of the addition of our new 747-400s and
fewer seasonal flight cancellations. On the cost side, the redemption in January of the Company's 12.25% Senior Secured
Notes will save the Company in excess of $12 million per annum in interest expense, as we continue to lower our overall
borrowing costs. Finally, our 3-for-2 common stock split entitled shareholders of record on January 25th to one additional
share of Atlas common stock for every two shares owned on that date. As we progress through the remainder of 1999, the
Company will continue to explore opportunities to further strengthen our balance sheet and maximize shareholder value.''
''Atlas experienced very strong customer demand during this first quarter,'' said Richard Shuyler, Executive Vice President.
''During this typically slower seasonal period, Atlas flew almost 24,000 block hours, a record first-quarter performance. This
provided continued evidence of the health of our customers and of the ACMI air cargo market. In addition, we have now
already successfully renewed or placed two of the aircraft contracts that are subject to renewal this year. Further, once we
conclude the remaining aircraft contract placements that occur later this year, Atlas will not have any contracts up for renewal
next year under the current schedule. Against this backdrop, and with attractive financing for all of this year's 747-400
deliveries now in place, we continue to look forward to a positive full-year 1999 and beyond.''
''The Boeing 747 aircraft continues to prove itself to be the most reliable, capable and economical freighter for Atlas and its
customers,'' said Michael Chowdry, Chairman, President and Chief Executive Officer. ''No other freighter can perform its
long-range mission, and do so at the lowest cost per ton mile. Moreover, Atlas is pleased to be the only company in the world
offering the superb 747-400 aircraft, in particular, under ACMI lease arrangements. Our exercise of two 747-400 options
during the quarter brings our available deliveries in the year 2000 to three units, and demonstrates our confidence in the
ongoing market for these aircraft. Further, we have one additional option available for the year 2000 and 7 more option
positions for deliveries thereafter. As to this year, we are looking forward to the delivery at the end of this quarter of the first of
the four new 747-400s to come from Boeing, and expect to make the related customer announcement in the near future.''
One-Time and Extraordinary Accounting Items
As previously reported in a press release dated January 19, 1999, the Company recorded one-time and extraordinary net of
tax charges during this quarter of $6.6 million as a result of its early redemption of its 12.25% Senior Secured Notes, and $1.4
million as a result of a change in accounting rules caused by the required adoption of SOP 98-5, ''Reporting on the Costs of
Start-Up Activities.'' Including these charges, the Company's net income for the first quarter of 1999 was $2.2 million, or $.07
per fully diluted share.
First-Quarter Activities
During the period, the Company announced the following developments:
-- In January, the Company redeemed in full its $100 million issue of 12.25% Senior Secured Notes due December 1,
2002.
-- Also in January, the Company declared a 3-for-2 common stock split.
-- In February, Atlas Air announced that Robert Arendal joined the Company as special advisor to the President for
European matters.
-- The Company in February also exercised options for firm delivery of two B747-400F aircraft in the year 2000.
-- In addition, the Company announced the placement of a B747-200F with Lan Chile under an ACMI contract and
renewed its contract with the Emirates.
-- In March, Atlas announced that it had become the number one carrier from Miami in terms of cargo tonnage,
according to the Miami International Airport.
-- Also in March, the Company announced plans to open a new cargo crew base at Anchorage International Airport.
-- In April, Atlas announced that it had completed the debt financing of all four 1999 B747-400F aircraft deliveries and
the first 2000 delivery under an EETC debt structure at a fixed interest rate of approximately 7.5%.
Atlas Air is a United States certificated air carrier that operates a fleet of 747 freighters under long-term ACMI contracts.
These contracts include the provision by Atlas of air cargo capacity for some of the world's leading international carriers. Atlas
operates scheduled flights on behalf of its customer airlines to 76 cities in 42 countries.
To the extent that any of the statements contained herein relating to the Company's expectations, assumptions and other
Company matters are forward-looking, they are made in reliance upon the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Such statements are based on current expectations that involve a number of uncertainties and
risks that could cause actual results to differ materially from those projected in the forward-looking statements, including, but
not limited to, risks associated with: worldwide business and economic conditions; product demand and the rate of growth in
the air cargo industry; the impact of competitors and competitive aircraft and aircraft financing availability; the ability to attract
and retain new and existing customers; normalized aircraft operating costs and reliability; management of growth; the continued
productivity of its workforce; dependence on key personnel; and regulatory matters. For additional information regarding these
and other risk factors, reference is made to the Company's Annual Report on Form 10-K for the year ended December 31,
1998.
Atlas Air, Inc.
SUMMARY FINANCIAL RESULTS
($ Millions, Except Share Data)
Quarter Ended 3/31
1999 1998
-----------------------------------
Operating Revenues $137.8 $ 79.6
Operating Income 36.7 21.5
Pre-Tax Income 16.4 8.4
Income before Extraordinary Item and
Cumulative Effect of a Change in
Accounting Principle 10.2 5.3
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Extraordinary Item:
Loss from Extinguishment of Debt,
Less Applicable Taxes of $3.9 ($6.6) $ --
Cumulative Effect of a Change in
Accounting Principle:
Write Off of Start-Up Costs, less
Applicable Taxes of $0.85 (1.4) --
----------------------------------------------------------------------
Net Income $2.2 $5.3
Diluted Earnings Per Share:
Before Extraordinary Item and
Cumulative Effect of a Change in
Accounting Principle $0.30 $0.16
----------------------------------------------------------------------
Extraordinary Item: (0.19) --
Cumulative Effect of a Change
in Accounting Principle (0.04) --
----------------------------------------------------------------------
Net Income $0.07 $0.16
Diluted Weighted Average Common Shares
Outstanding (000s) 34,327 33,834
Total Block Hours 23,931 15,388
Contact:
Atlas Air, Inc., Golden
Stephen C. Nevin, 303/526-5050 |
