Air Transport Services Group (ATSG) swung to a net profit of $14.7 million in the fourth quarter of 2024, compared to a net loss of $15 million a year prior.
Free cash flow was $34.7 million for the quarter, swinging from a negative $65.6 million a year prior.
Revenues were $516.8 million, down slightly from $517 million a year prior. Operating expenses totalled $475 million, down from $480.4 million in the fourth quarter of 2023. This included merger transaction fees totalling $8.3 million. ATSG agreed to acquire investment firm Stonepeak for $3.1bn in November 2024. Stockholders approved the acquisition and it is currently working to obtain approval from the US Department of Transportation.
“We remain excited about our future with Stonepeak, and we are on track for closing in the first half of this year,” said ATSG CEO Mike Berger.
Operating income totalled $41.8 million in the fourth quarter, up from $36.6 million a year prior. Pre-tax earnings were $24.3 million, swinging from a pre-tax loss of $15.6 million.
Full year revenues were $2bn, down slightly from $2.1bn in 2023. Full year free cash flow swung to a positive $228.1 million, compared to a negative $111.8 million. However, net earnings in 2024 were down to $27.4 million, compared to $60.3 million in 2023. Operating expenses for the year were down from $1.9bn in 2023 to $1.8bn in 2024. Full year operating income totalled $127.8 million, down from $200 million a year prior.
The company's cargo aircraft management (CAM) segment added nine 767-300 freighter aircraft and placed all under long-term leases. Eleven more customer-provided 767-300 freighters were subleased to and operated by an ATSG cargo airline during the year. As of the end of 2024, 27 767-300s were in its fleet. The company sold six 767-200s and three 767-300s in the year, as well as 91 of its owned aircraft were on lease to external customers as of the end of the year.
The segments leasing and related revenues were down 12% in the fourth quarter and 6% for the full year. This decline was driven by the return of nine 767-200 and four 767-300 aircraft, as well as lower lease-related maintenance revenue over the year.
CAM's pre-tax earnings were down 44% to $12 million in the fourth quarter and down 46% to $59 million for the full year.
In addition, 14 of the segment's owned aircraft were in or awaiting conversion to freighters as of the end of the fourth quarter, including seven 767s, one A321, and six A330s. The company expects its first four converted A330 freighters this year.
The company's ACMI services had benefitted from eleven customer-provided 767-300 aircraft added to its flight operations, resulting in pre-tax earnings of $26 million in the quarter, swinging from a pre-tax loss of $2 million a year prior.
“In ACMI Services, we saw improved profitability in the quarter, operating all ten of the additional aircraft recently provided by Amazon with sequential quarter improvements in both passenger and freighter hours flow,” added Berger.
However, full year pre-tax earnings were down to $1 million, compared to $32 million in 2023. This was driven by reducing flying in its customers delivery networks and passenger operations.
As of the end of the year, assets totalled $3.9bn. Stockholders' equity totalled $1.5bn. The company held $60.6 million in cash and cash equivalents as of the end of the year.