Air Transport Q2 Earnings Beat Estimates & Revenues Lag

Air Transport Services Group's ATSG second-quarter 2024 earnings (excluding 8 cents from non-recurring items) of 19 cents per share surpassed the Zacks Consensus Estimate of 16 cents but plunged 66.7% year over year.  Customer revenues (derived after eliminating internal revenues from total revenues) of $488.4 million missed the Zacks Consensus Estimate of $512.3 million and fell 7.7% year over year.

ATSG primarily operates through the following reporting segments, namely Cargo Aircraft Management or CAM and ACMI (aircraft, crew, maintenance & insurance) Services. Revenues from ACMI Services decreased 7.7% year over year to $338.2 million. Revenues from CAM and other operations declined 6.2% and 11.9% to $104.5 million and $97.64 million, respectively.

Adjusted EBITDA fell 17% year over year to $130.4 million. Operating cash flow declined to $137.1 million from $192.2 million a year ago. Adjusted free cash flow was $109.8 million compared with $136.6 million in the prior year.

2024 Adjusted EBITDA Outlook Raised

Air Transport now anticipates adjusted EBITDA of almost $526 million (earlier outlook was $516 million). The improved outlook for adjusted EBITDA is owing to the anticipation of more flying opportunities from 10 Amazon-provided 767-300s and new lease commitments for available aircraft.

ATSG expects third-quarter Adjusted EBITDA to be similar to the second quarter as ramp-up costs for adding 10 Amazon-supplied 767 freighters continue but are higher in the fourth quarter when the last few enter service and other peak-season operations occur. Capital spending for the current year is projected to be $390 million. The company expects to end 2024 with a fleet size (in service) of 139 aircraft (20 passengers and 129 freighters).

Currently, Air Transport carries a Zacks Rank #4 (Sell).

Q2 Performances of Other Transportation Companies

Delta Air Lines' DAL second-quarter 2024 earnings (excluding 35 cents from non-recurring items) of $2.36 per share missed the Zacks Consensus Estimate of $2.37 and decreased 12% year over year.

Revenues of $16.7billion surpassed the Zacks Consensus Estimate of $16.3 billion and increased 7% on a year-over-year basis. Passenger revenues, accounting for 83% of the total revenues, improved 5% year over year.

United Airlines UAL reported second-quarter 2024 earnings (excluding 18 cents from non-recurring items) of $4.14 per share, which surpassed the Zacks Consensus Estimate of $3.97 per share. However, the bottom line decreased 17.69% year over year.

Operating revenues of $15 billion missed the Zacks Consensus Estimate of $15.13 billion. However, the top line increased 5.7% year over year due to upbeat air travel demand. Cargo revenues rose by 14.4% year over year to $414 million. Revenues from other sources jumped 9.6% year over year to $892 million.

J.B. Hunt Transport Services' JBHT second-quarter 2024 earnings per share of $1.32 missed the Zacks Consensus Estimate of $1.51 and declined 27.1% year over year.

Total operating revenues of $2.93 billion lagged the Zacks Consensus Estimate of $3.04 billion and fell 6.5% year over year. Total operating revenues, excluding fuel surcharge revenues, decreased approximately 6% year over year.

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