Atlas Air Worldwide is putting back on service some of its parked aircraft in response to increasing demand for airfreight amid the continuing global fight against the coronavirus pandemic. 

“The strong demand for airfreight has carried into the second quarter. To meet that demand, we reactivated three of our 747 converted freighters that had been parked and began operating a 777F that was previously in our dry-leasing business,” said John W. Dietrich, Atlas Air Worldwide president and CEO.

Atlas Air Worldwide reported a 5% year-on-year drop in revenues to US$643.5 million from US$679.7 million based on its first-quarter performance while net income rose to US$23.4 million.

Volumes during the same period amounted to 73,247 block hours compared with 77,061 recorded in the same first-quarter period in 2019.

Atlas Air Worldwide said its first-quarter results reflect the ongoing impact of the coronavirus crisis in the air freight industry.

“After a slow start, and despite the continual and varying operational challenges and uncertainties related to COVID-19, we ended the quarter with results that exceeded our expectations,” Dietrich said.

“Our results reflected increased charter cargo demand and higher airfreight yields in March. They also reflect the vital role that Atlas plays in supporting the global economy and our customers by keeping goods moving,” he added.

Atlas Air Worldwide’s charter division saw revenues increase by 7% year on year to US$327.6 million in 2020.

“[The charter division’s increase in] contribution was primarily driven by an increase in commercial cargo yields (excluding fuel), reflecting a reduction of available capacity in the market and the disruption of global supply chains due to the Covid-19 pandemic,” Atlas Air said.

Outlook for the months ahead

Atlas Air said it is positive that its second-quarter performance will be positive — as it expects that bulk of its earnings will be realized in the second half of this year. 

Nonetheless, the freighter said it is “mindful of the evolving and uncertain environment and the importance of prudent financial management”.

“We are taking actions to reduce costs and enhance liquidity, including significantly reducing discretionary spending, limiting our hiring for certain positions and selling non-essential assets,” said Dietrich.

“We expect the positive trends that we are currently experiencing to continue throughout the remainder of the year, and we expect a majority of our earnings to occur in the second half of this year,” he added, noting that the evolving and uncertain environment related to COVID-19 makes it difficult to accurately predict the future impact on our results.

“We expect to fly approximately 80,000 block hours in the second quarter of 2020, with revenue of approximately $770 million, and adjusted EBITDA of about $165 million,” Dietrich added.