Tag Archives: 747800F

British Airways to return three GSS Boeing 747-8 freighters to Atlas Air Worldwide Holdings in April

Atlas Air Worldwide Holdings, Inc. (Atlas Air) (New York) has announced it intends to pursue new ACMI (aircraft, crew, maintenance and insurance) placement opportunities for three 747-8 Freighter aircraft currently operated for British Airways plc by Atlas Air Worldwide’s 49%-owned UK subsidiary, Global Supply Systems Limited (GSS).

The action follows notice from British Airways, a unit of International Consolidated Airlines Group, S.A., regarding British Airways’ strategic decision to exit dedicated cargo-freighter service and to return the aircraft to GSS in April 2014 pursuant to the terms of the existing ACMI agreement between the parties.

Effective with the termination of the agreement, the three 747-8Fs will be redelivered to the company by GSS. Through GSS, the company also will receive contractual early termination fees from British Airways.

Meanwhile Qatar Airways (Doha) will operate five Boeing 777F freighter flights between Hong Kong and London for IAG Cargo (British Airways) starting on May 1. IAG Cargo issued this statement:

IAG Cargo has announced it has signed a long-term commercial agreement with Qatar Airways to purchase capacity on Qatar Airways-operated air cargo freighters, effective from May 1, 2014.

Qatar Airways will operate five Boeing 777F flights a week between Hong Kong and London on behalf of IAG Cargo, providing continuity of service for IAG Cargo customers.

The agreement marks a transition for IAG Cargo and follows the company’s decision to transfer freighter operations from its current provider, Global Supply Systems.

IAG Cargo connects 350 destinations worldwide, serving the world’s economic hubs with cargo-friendly wide-bodied planes. Through its Constant Climate network, it has one of the largest networks globally for handling temperature-sensitive air cargo.

Qatar Airways is already a partner with IAG through the oneworld global alliance which it joined in October 2013. The airline is taking delivery of a further three Boeing 777F aircraft during 2014.

Top Copyright Photo: Rainer Bexten/AirlinersGallery.com. This decision will end British Airways World Cargo and Global Supply Systems. GSS operated Boeing 747-87UF G-GSSD (msn 37562) in British Airways World Cargo colors departs graceful from Cologne/Bonn.

British Airways World Cargo (GSS): AG Slide Show

Qatar Airways: AG Slide Show

Video: Flying the Boeing 747-800F freighter:

Bottom Copyright Photo: Ton Jochems/AirlinersGallery.com. Boeing 777-FDZ A7-BFA (msn 36098) of Qatar Airways Cargo taxies at Amsterdam.

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Boeing downgrades the 747-8 production rate to 1.5 aircraft per month

Boeing (Chicago) has just announced that it will adjust the production rate for the 747-8 program from 1.75 airplanes to 1.5 airplanes per month through 2015 because of lower market demand for large passenger and freighter airplanes.

The company expects long-term average growth in the air cargo market to begin returning in 2014, and forecasts global demand for 760 large airplanes (such as the 747-8) over the next 20 years, valued at $280 billion.

The 747-8 family provides airlines with double-digit improvements in fuel efficiency, operating costs and emissions, while being 30 percent quieter and adding more capacity. To date, the 747-8 has accumulated 107 orders for passenger and cargo versions, 56 of which have been delivered.

The first delivery at the new production rate is expected in early 2014. The production rate change is not expected to have a significant financial impact.

Copyright Photo: Nick Dean/AirlinersGallery.com. Boeing 747-8KZF N50217 (JA12KZ) (msn 36137) climbs away from the runway at Paine Field near Everett, WA.

Korean Air agrees to order five Boeing 747-8s and six additional 777-300 ERs

Boeing (Chicago) and and Korean Air (Seoul) today announced that the airline has agreed to purchase five 747-8 Intercontinental airplanes and six 777-300 ER (Extended Range) jetliners, valued at approximately $3.6 billion at current list prices. Boeing will work with Korean Air to finalize the order, at which time the order will be posted to Boeing’s Orders and Deliveries website.

Korean Air is the only airline in the world to order both the passenger and freighter variations of the 747-8. When today’s order is finalized, Korea’s flag carrier will have 10 747-8 Intercontinental airplanes on order. The airline has taken delivery of three of its seven 747-8 Freighters on order.

Korean Air currently operates a fleet of 90 Boeing passenger airplanes that consist of 737, 747 and 777 airplanes. The airline also operates an all-Boeing cargo fleet of 27 747-400, 747-8 and 777 Freighters. In February 2012, Korean Air became the first airline in the world to operate both the 747-8 and 777 Freighters.

Top Copyright Photo: Michael B. Ing/AirlinersGallery.com. Korean Air is already an operator of the Boeing 747-800F freighter. Korean Air Cargo Boeing 747-8HTF HL7609 (msn 37132) climbs briskly in the Southern California sky after departing from Los Angeles International Airport.

Korean Air: AG Slide Show

Bottom Copyright Photo: Royal S. King/AirlinersGallery.com. Boeing 777-3B5 ER HL7782 (msn 37643) lands at Paine Field near Everett.

Atlas Air starts operating a Boeing 747-800F freighter for Etihad Cargo, Miami becomes part of the round-the-world cargo route

Atlas Air (New York) on May 30 started operating its newest Boeing 747-800F for Etihad Cargo (formerly Etihad Crystal Cargo) (Etihad Airways) (Abu Dhabi). The fully-painted freighter will operate twice-weekly cargo services to and from Miami.

Etihad Airways announced its new round-the-world cargo flight:

The jointly operated routing began on May 30, connecting Etihad Cargo’s Abu Dhabi hub with destinations in Asia, the United States, South America and Europe.

Miami (US), Viracopos (Brazil), and Quito (Ecuador) will become part the round-the-world Abu Dhabi-Hong Kong-Chicago O’Hare-Miami-Viracopos-Quito-Amsterdam-Abu Dhabi freighter service offered with an Etihad Cargo-liveried Boeing 747-8F Freighter.

Earlier this month, Etihad Cargo signed a signed a multi-year Aircraft, Crew, Maintenance and Insurance (ACMI) agreement with Atlas Air to provide the Boeing 747-8F Freighter with its 138-ton cargo capacity to operate the new schedule.

The three new freighter destinations in the Americas will see Etihad Cargo’s network extend to 92 points across the globe. The carrier’s eight freighters operate to 28 of these destinations.

The Boeing 747-8F Freighter is the largest in Etihad Cargo’s current freighter fleet. The airline also operates three Boeing 777Fs, one Boeing 747-400ERF, one Boeing 747-400F and two Airbus A330-200Fs.

Etihad Cargo will take delivery of two additional freighters in 2013 and 2014, comprising two Airbus A330-200Fs.

Atlas Air previously made this announcement in May:

The 8th Boeing 747-800F freighter will fly on behalf of Etihad Cargo, the cargo arm of Etihad Airways, the national carrier of the United Arab Emirates, pursuant to a multi-year aircraft, crew, maintenance and insurance agreement that commences in May 2013.

The new contract between the companies follows a letter of intent announced on April 1, 2013, and complements an existing Boeing 747-400F ACMI arrangement between Atlas and Etihad. The aircraft will be operated in full Etihad Cargo livery.

Copyright Photo: Michael Bolden. The pictured Boeing 747-87UF N855GT (msn 37567) was delivered to Atlas Air on May 18, 2013. The Jumbo Freighter prepares to depart from Miami on its twice-weekly round-the-world cargo route.

Atlas Air: AG Slide Show

Etihad Airways: AG Slide Show

 

Atlas Air Worldwide Holdings reports 1Q net income of $5.9 million

Atlas Air Worldwide Holdings, Inc. (Atlas Air) (New York-JFK) today announced adjusted net income attributable to common stockholders of $5.9 million, or $0.22 per diluted share for the first quarter of 2013 compared with adjusted earnings of $13.6 million, or $0.51 per diluted share, for the first quarter of 2012.

On a reported basis, net income attributable to common stockholders in the first quarter totaled $20.1 million, or $0.76 per diluted share, compared with $12.8 million, or $0.48 per diluted share in the year-ago quarter.

Adjusted earnings in the first quarter of 2013 exclude an income tax benefit of $14.2 million, or $0.54 per diluted share, related to the tax treatment of extraterritorial income from the offshore leasing of certain aircraft. Adjusted earnings in the first quarter of 2012 exclude fleet retirement costs of $0.9 million, or $0.03 per diluted share.

First-quarter revenue grew 5% to $377.3 million, with operating income increasing 10% to $22.6 million and operating margin expanding slightly. Free cash flow for the period totaled $42.4 million compared with $1.0 million in the first quarter of 2012.

“Our first-quarter results and initiatives demonstrate the benefits of a modern, efficient fleet, diversified business mix and solid balance sheet in a challenging business environment,” said William J. Flynn, President and Chief Executive Officer.

“Operating income during the quarter reflected the strength of our ACMI operations, especially our new 747-8 freighters. It also gained from new organizational capabilities and the evolution of our business, such as our expanding 767 service and growing CMI operations. We also realized operating efficiencies through our continuous improvement initiatives.

“Capitalizing on our financial strength, we acquired an immediately profitable 777 freighter under long-term customer lease for our Dry Leasing business. We also implemented an immediately accretive share repurchase program that acquired 3.4% of our outstanding stock for a total of $36.5 million through late April.

“Earnings in the first quarter were in line with our expectations and our outlook for the year. As a result, we are affirming previous guidance for 2013 but we are raising our expected adjusted earnings per share to $4.80 from $4.65 to reflect our actual and anticipated share repurchases.”

First-Quarter Results

Revenue, volume and profitability growth in our core ACMI business during the first quarter were driven by our new 747-8Fs, with four additional -8F aircraft in service compared with the first quarter of 2012, as well as the continued ramp up of CMI flying for Boeing and DHL Express.

Improved ACMI segment earnings during the period also benefited from higher rates per block hour and lower maintenance expense for our 747-8Fs, partially offset by the redeployment of 747-400 aircraft to other business segments.

In AMC Charter, strong growth in passenger service volumes partially offset a 41% reduction in cargo block hours, a reduction in the number of one-way AMC missions, and lower average cargo revenue per block hour, which led to a decline in segment contribution. Lower average passenger revenue per block hour during the period stemmed from an increase in flying on smaller-gauge 767 aircraft added to supplement our wide-body 747-400 passenger service and enhance our share of military passenger business.

Segment results in Commercial Charter reflected the seasonal nature of this business and were primarily related to a reduction in yields driven by soft first-quarter global charter-market conditions.

Results in the first quarter were also affected by higher non-operating expenses, primarily due to a reduction in capitalized interest on 747-8F aircraft that entered service.

Income Taxes

Reported earnings for the first quarter of 2013 included an effective income tax rate benefit of 97.4%, reflecting a federal income tax benefit of $14.2 million related to the tax treatment of extraterritorial income from the offshore leasing of certain of our aircraft.

Cash, Cash Equivalents and Short-Term Investments

At March 31, 2013, our cash, cash equivalents and short-term investments totaled $343.9 million, compared with $419.9 million at December 31, 2012.

The change in cash, cash equivalents and short-term investments was primarily driven by an increase in cash provided by operating and financing activities, offset by cash used for investing activities.

Net cash used for investing activities in the first quarter of 2013 primarily related to the purchase of a 747-8F aircraft for our ACMI operations and a 777-200 LRF aircraft for our Dry Leasing business.

Net cash provided by financing activities primarily reflected proceeds from the issuance of debt in connection with the acquisitions of these aircraft. These proceeds were partially offset by payments on debt obligations and a prepayment under an accelerated share repurchase program agreement (“ASR”).

Share Repurchase Activity

Between mid-February and late April 2013, we repurchased 903,301 shares of our common stock for $36.5 million at an average cost of $40.40 per share. The shares were acquired pursuant to an ASR with an investment bank that settled on April 25, 2013.

We acquired 427,168 of these shares during the period ended March 31, 2013, which added $0.01 per diluted share to our adjusted and reported earnings for the first quarter.

Future repurchases may be made at our discretion, and the actual timing, form and amount will depend on company and market conditions.

Outlook

We expect to generate strong earnings and cash flow in 2013. Led by ACMI, each of our business segments is expected to be profitable for the year.

Incorporating our share repurchase activity, we anticipate that our adjusted fully diluted earnings per share this year will total approximately $4.80, an increase from prior guidance of approximately $4.65. Including the extraterritorial income tax benefit of $0.54 per share, our reported fully diluted earnings per share in 2013 should be approximately $5.34.

Both adjusted and reported full-year 2013 EPS guidance assume the repurchase of $50.0 million of our outstanding stock during the year.

Our expectation for full year 2013 operating performance is unchanged from the outlook we issued last quarter. We now expect to fly fewer block hours in our Commercial Charter segment in 2013 than we previously forecast. We also expect lower operating expenses as a result of continuous improvement initiatives that drive productivity improvements and operating efficiencies. These initiatives target all aspects of our business, including engine overhauls, procurement efforts, passenger catering, ground travel, and crew scheduling.

Similar to the first quarter, adjusted and reported full-year earnings in 2013 will reflect strong growth from the company’s 747-8Fs in ACMI, driven by an increase in the number of -8F aircraft in ACMI service compared with 2012, including the incremental placement with Etihad Airways we announced today.

Market growth during 2013 should be seasonal and second-half weighted. We continue to anticipate a sequential increase in our quarterly earnings throughout the year, with approximately 75% of adjusted earnings per share and 66% of reported earnings per share occurring in the second half.

Based on our revised view, block-hour volumes in 2013 are now expected to total approximately 175,000 hours. ACMI segment flying should account for about 135,000, or 77%, of expected 2013 block hours, with about 22,000, or 13%, in Commercial Charter and 18,000, or 10%, in AMC Charter. Passenger charter flying should account for more than 10,000 AMC Charter block hours in 2013.

Based on anticipated deliveries of 747-8Fs in our outstanding order, the average number of -8Fs in service in 2013 should increase to more than eight from 4.3 in 2012.

In addition, we now anticipate that maintenance expense will total approximately $172 million in 2013, about 60% of which should be incurred in the first half of the year.

Mr. Flynn concluded: “In an environment of continuing global uncertainty, we are well-positioned to serve our customers and the airfreight markets. We have performed well. We are ready to capitalize on market improvements. And we are executing a strategic plan that leverages our core competencies, provides a basis for returning capital to our investors through share repurchases, and will enable us to grow over the long term.”

In other news, Atlas Air has confirmed the placement of its eighth Boeing 747-8 Freighter into ACMI service.

The aircraft will fly on behalf of Etihad Cargo, the cargo arm of Etihad Airways, the national carrier of the United Arab Emirates, pursuant to a multi-year aircraft, crew, maintenance and insurance agreement that commences in May 2013.

The new contract between the companies follows a letter of intent announced on April 1, 2013, and complements an existing Boeing 747-400F ACMI arrangement between Atlas and Etihad. The aircraft will be operated in full Etihad Cargo livery.

Copyright Photo: Pedro Pics. Atlas Air operates this Boeing 747-87UF N850GT (msn 37570) for Panalpina Air and Ocean in their colors.

Atlas Air: AG Slide Show

Panalpina: AG Slide Show

Cargolux loses $35.1 million in 2012

Cargolux Airlines International (Luxembourg) issued its financial statement for 2012:

At the April 24 annual General Meeting, the shareholders of Cargolux Airlines International S.A. approved the audited Financial Statements for the financial year ended December 31, 2012.

The steep decline in air cargo markets at the end of 2011 continued into 2012 not only for Cargolux, but for the industry as a whole. Depressed demand coupled with continued overcapacity resulted in significant pressure on yields and load factors for all freight operators.

Despite an improvement in late 2012, Cargolux recorded an overall loss of $35.1 million on revenues of $1,738.9 million. This loss, however, is markedly lower than the $57.0 million loss budgeted by the airline for the 2012. With the improvement in demand experienced in the last quarter of 2012 and the positive volume growth experienced by the airline for the first quarter of 2013 versus 2012, Cargolux remains cautiously optimistic for the current year. ‘Considering the state of the industry and the economic difficulties worldwide, Cargolux fared better than anticipated in 2012, that gives me hope for the current year,’ said Paul Helminger, Chairman of the Board of Directors.

In 2012, Cargolux carried 645,759 tons of cargo on its worldwide network. The fleet consisted of a mix of Boeing 747-400 and 747-8 freighters. With the new 747-8F gradually replacing the 747-400F, the airline operated eleven 747-400F and six 747-8F at the end of December 2012. Four Boeing 747-8 freighters joined the fleet during the year and additional deliveries are expected in 2013. In total, Cargolux will receive 13 units of the advanced freighter.

Cargolux has implemented a new business plan designed to ensure the long-term sustainability of the airline with a return to profitability in 2014.

Copyright Photo: Paul Denton. Boeing 747-8R7F LX-VCE (msn 35810) approaches Dubai International Airport (DXB) for landing.

Cargolux: AG Slide Show

 

Atlas Air takes delivery of its eighth Boeing 747-800F freighter

Atlas Air (New York) has taken delivery of its eighth Boeing 747-8F Freighter.

Pursuant to a letter of intent (LOI) with an undisclosed customer, the new aircraft is expected to enter ACMI (Aircraft, Crew, Maintenance and Insurance) service during the first half of the second quarter of 2013, which will allow the customer time to integrate the capacity into its scheduled network.

Prior to beginning in ACMI, the aircraft will be operated in short-term, revenue-generating service.

Atlas Air expects to receive one additional 747-8F by the end of the second quarter of 2013, completing the delivery of its order program for nine aircraft.

Copyright Photo: Nick Dean. Boeing 747-87UF N854FT (msn 37566) was handed over in the full Atlas Air livery on April 1. N854FT climbs away from Paine Field near Everett.

Atlas Air: AG Slide Show