Revenue and earnings were below expectations for Atlas Air Worldwide, with management citing tariffs and trade concerns as reasons for the slowdown.
Net income in the first half of 2019 was $57.1 million compared to a loss of $11.5 million in 2018, which had been caused by unrealised losses on outstanding warrants of $50 million.
Second quarter net income in 2019 was $86.8 million compared to a loss of $21.1 million in 2018.
Adjusted income from continuing operations net of tax was down 90.9% in the second quarter to $4.5 million, and by 56.7% to $31.8 million in the six months up to 30 June.
William Flynn, chief executive officer of Atlas Air says: “Revenue and earnings in the second quarter were below our expectations, as air cargo volumes and yields were affected in the near term by the widely reported impact of tariffs and trade tensions. In addition, our results during the period were impacted by labour-related service disruptions.”
He says: “With manufacturers and shippers taking a wait-and-see approach regarding tariffs and trade issues during the course of the quarter, we experienced a softening in anticipated commercial cargo block hours and yields in our charter segment.”
Flynn says Atlas Air is undergoing improvement initiatives to increase productivity, enhance efficiency and grow the business.
He says: “We remain committed to negotiating a competitive collective bargaining agreement for our pilots. Our recent bargaining sessions have made progress, and we look forward to the upcoming scheduled sessions to continue that progress toward an agreement that all parties want.”
Responding to the results, recently retired Atlas Air pilot Captain Robert Kirchner says blaming trade tensions and labour-related disruption is an attempt to deflect the blame for mismanagement.
The executive council chairman for Atlas Air pilots of Teamsters Local 1224 says the lack of pilots and overpromising services to customers including Amazon Air is resulting in operational chaos.
He says: “Our pilots are also constantly being asked to fly on their days off because of poor planning by Atlas Air executives. This disorganisation led to more than 400 flights without an assigned crew in July. Atlas Air can only put on this charade for so long. It’s time for executives to stop stonewalling negotiations and get serious about settling a fair contract with pilots.”