Air Transport Services Group, Inc. reported record consolidated financial results for the quarter ended December 31, 2021.
Rich Corrado, president, and chief executive officer of ATSG, said, "Our 2021 results demonstrate the powerful combination of having the right solutions for our customers, the right strategy for deploying our in-demand assets, and the right people to operate and support them. These results flow from investing to extend our lead as the largest lessor of freighter aircraft, and from delivering best-in-class air express service for the e-commerce customers who demand it. I am extremely proud of our people as they lay the foundation for even more exceptional results over the next several years. As we look to the immediate future in 2022, we expect even higher achievements, with our outlook for almost $100 million in additional Adjusted EBITDA over our record 2021 results."
ÿ2022 Outlook
ATSG expects its Adjusted EBITDA for 2022 to be $640 million, or nearly $100 million more than 2021 results. It also projects 2022 capital spending of $590 million, including $200 million in sustaining capex and $390 million for growth.
The forecast assumes:
? Leases of nine 767-300 and two A321-200 freighters.
? Contributions from seven 767 freighter aircraft to be added to customer CMI contracts duringÿ2022, including five to be provided by customers.
? Continued moderation of pandemic effects on demand for ATSG?s passenger and Boeing 757ÿcombi operations, as both revenues and margins for these flight operations continue to recover.
2022 results for passenger operations are expected to approximate pre-pandemic 2019 levels,ÿreflecting more normalized support for both military and commercial passenger customers.
The strong operating momentum in ATSG?s freighter leasing and airline businesses, together with the change in engine maintenance services for ATSG's 767-200s, will drive substantial increases in 2022 adjusted earnings as well as Adjusted EBITDA. In addition to the 18 percent increase in projected Adjusted EBITDA for 2022, ATSG also expects its Adjusted EPS to increase by 20 percent to $2.00 in 2022. The Adjusted EPS increase also reflects a change in accounting rules for convertible debt that took effect this year. The change increases the number of ATSG's adjusted shares outstanding by 8 million. 2022 Adjusted EPS guidance reflects the effect of that accounting change.
ÿCorrado noted that demand for express-package air transport reached record levels throughout theÿfourth-quarter holiday season, in part due to exceptional e-commerce demand and continuing constraints on other transport modes. ?Our customers tell us that they appreciate ATSG?s ability to sustain high levels of on-time performance despite adverse weather and pandemic conditions, including our ability to provide additional airlift on short notice when crew shortages or aircraft issues sideline other operators.
ÿATSG has reserved significant passenger-to-freighter conversion capacity for Boeing 767 and AirbusÿA330 aircraft over the next several years, assuring its continued leadership in that steadily expandingÿmidsize widebody space. Together with its investment in narrow-body A321 conversions best suited for smaller-volume express package and e-commerce destinations, ATSG expects to be a principal source of dedicated freighters for regional and trans-Atlantic airlift to express-package delivery networks anywhere in the world.
Corrado concluded, ?We have customer commitments to lease all nine of the Boeing 767s we will deploy in 2022 and the majority of those we expect to lease in 2023. In addition, we already hold lease deposits for more than half of the A330 aircraft we intend to begin deploying in 2024,? he said. ?We have also purchased or hold options to acquire more than half of the feedstock aircraft we will need to meet those commitments. I am very bullish that the strong demand and operating excellence of ATSG will persist and generate even stronger returns in the years to come.?
