ATSG Reports Strong Second Quarter 2019 Results

Continued Double-Digit Percentage Growth in Revenues, Adjusted Earnings and Adjusted EBITDA

WILMINGTON, Ohio–(BUSINESS WIRE)–Air Transport Services Group, Inc. (Nasdaq: ATSG), the leading provider of medium wide-body aircraft leasing, contracted air transportation and related services, today reported consolidated financial results for the quarter and six months ended June 30, 2019. Results as compared with the second quarter of 2018 include:

  • Customer revenues were $334.6 million, up $131.0 million, or 64 percent.

Each of ATSG’s principal business segments, aircraft leasing and air transport, reported higher revenues for the second quarter. Revenues from Omni Air International, which ATSG acquired in November 2018, were the largest contributor to the year-over-year revenue gain.

  • GAAP Earnings from Continuing Operations were a loss of $26.6 million, versus a profit of $24.5 million. GAAP Earnings per Share were a loss of $0.45, versus a profit of $0.21.

The unrealized effect of re-measurement of financial instrument values reduced ATSG’s second quarter 2019 after-tax earnings by $33.6 million and increased second quarter 2018 after-tax earnings by $11.1 million. The majority of the loss and gain related to changes in values of warrants issued to Amazon.com Services, Inc. Increases in interest expense, depreciation and amortization expense, and in retiree benefit costs were also significant factors.

  • Adjusted Earnings from Continuing Operations (non-GAAP) increased by $1.7 million, or 10 percent, to $18.7 million. Adjusted Earnings Per Share (non-GAAP) were $0.27 diluted, up $0.02.

Adjusted Earnings from Continuing Operations and Adjusted EPS exclude elements from GAAP results that in management’s opinion differ distinctly in predictability among periods or are not closely related to operations. Adjustments from GAAP include financial instrument revaluations, amortization of aircraft lease incentives, retiree benefit costs, and losses of non-consolidated ATSG affiliates.

  • Adjusted EBITDA from Continuing Operations (non-GAAP) were $104.8 million, up $35.0 million, or 50 percent.

Contributions from Omni Air and from the increase in externally leased 767 freighters since June 2018 drove the majority of the Adjusted EBITDA increase.

Adjusted Earnings per Share, Adjusted Earnings from Continuing Operations and Adjusted EBITDA from Continuing Operations are non-GAAP financial measures and are defined in the non-GAAP reconciliation tables at the end of this release. (See the paragraph entitled “Non-GAAP Financial Measures”)

  • First-half capital spending was $216.8 million, up 44 percent.

Capital expenditures in the first half of 2019 included $159.0 million for the purchase of seven Boeing 767 aircraft, including three in the second quarter, and for freighter modification costs.

Joe Hete, President and Chief Executive Officer of ATSG, said that ATSG’s operating momentum continued during the second quarter, as flight operations for the Department of Defense and Amazon increased versus prior-year periods. ATSG now expects a 36 percent increase in Adjusted EBITDA in the second half versus a year ago, thanks to both increased flight operations and more leased aircraft in service.

“In December 2018, ATSG agreed to lease ten more Boeing 767-300 converted freighters to Amazon, anticipating five deliveries in each of the next two years,” Hete said. “At Amazon’s request, we now expect to deliver them six 767 freighters this year, and the remaining four in 2020. The first of those six was delivered in June, the second in early July, and the third is due later this month. At the same time, we have agreed to lease four 767 freighters to United Parcel Service this year, starting in September.”

Hete added that in both the leasing of converted freighter aircraft and flight and maintenance operations for customers, ATSG is executing according to its plans and on track for a very good 2019. “We look forward to growth in our operations for the Department of Defense, and in fulfilling signed lease commitments from Amazon and United Parcel Service in 2019 for a total of ten converted Boeing 767 freighters. In 2020, we expect to deploy at least 10 more aircraft, four of which are under customer commitments to Amazon and one that we expect to lease to UPS next year,” he said.

Segment Results

Cargo Aircraft Management (CAM)

CAM

Second Quarter

 

Six Months

($ in thousands)

2019

 

2018

 

2019

 

2018

Aircraft leasing and related revenues

 

$

73,280

 

 

$

58,603

 

 

$

147,857

 

 

$

115,205

 

 

Lease incentive amortization

 

(4,024

)

 

(4,226

)

 

(8,251

)

 

(8,452

)

 

Total CAM revenues

 

69,256

 

 

54,377

 

 

139,606

 

 

106,753

 

 

Segment earnings, pretax

 

16,683

 

 

15,394

 

 

32,857

 

 

30,858

 

 

Significant Developments:

  • CAM’s revenues, net of warrant-related lease incentives, increased 27 percent. Second quarter revenues benefited from five more converted 767-300 freighters in service at June 30, 2019, versus the same date a year ago, and a full first half of revenues from eleven Omni Air passenger aircraft that CAM acquired and leased back to Omni Air in November 2018. CAM’s external customer revenues increased 5 percent to $40.0 million.
  • At June 30, 2019, ATSG’s in-service fleet included seventy-six cargo and eleven passenger aircraft. Fifty-six cargo aircraft were leased to external customers, two more than the prior year. Eleven 767s were awaiting or undergoing conversion to freighters at June 30, including three passenger 767s acquired for conversion during the second quarter of 2019.
  • CAM’s pretax earnings for the quarter were $16.7 million, up 8 percent from the prior-year quarter. In addition to revenue gains from additional aircraft leases, earnings reflected $4.9 million more in allocated interest expense and $8.2 million more for depreciation expense, due to both organic and acquired fleet growth.

ACMI Services

ACMI Services

 

Second Quarter

 

Six Months

($ in thousands)

 

2019

 

2018

 

2019

 

2018

Revenues

 

$

254,938

 

 

$

119,606

 

 

$

512,894

 

 

$

238,980

 

 

Segment earnings, pretax

 

973

 

 

500

 

 

13,283

 

 

3,915

 

 

Significant Developments:

  • Revenues more than doubled to $254.9 million from the second quarter last year, stemming mainly from Omni Air’s operations for the Department of Defense since ATSG acquired Omni in November 2018, and flight operations in 2019 for United Parcel Service.
  • Pretax earnings were $1.0 million, up from $0.5 million, reflecting contributions from Omni. Earnings were adversely affected by unscheduled engine maintenance expense, and previously forecast ramp-up costs for anticipated heavier flight operations in the second half. Interest expense allocated to ACMI Services for the second quarter was $6.4 million in 2019 and $0.5 million in 2018. The increase is primarily related to debt associated with the Omni Air acquisition.
  • Total block hours increased 32 percent from last year’s second quarter, principally due to the growth in Omni Air’s ACMI and charter operations. Omni Air’s block hours for the Department of Defense were lower in the second quarter than in the first quarter of 2019.

Other Activities

Other

 

Second Quarter

 

Six Months

($ in thousands)

 

2019

 

2018

 

2019

 

2018

Total Revenues

 

$

71,104

 

 

$

65,361

 

 

$

138,466

 

 

$

137,259

 

 

Revenues from external customers

 

$

39,754

 

 

$

46,002

 

 

$

88,375

 

 

$

93,781

 

 

Pretax Earnings

 

4,006

 

 

3,039

 

 

5,909

 

 

6,757

 

 

Significant Developments:

  • Total second-quarter revenues from other activities of $71.1 million increased by $5.7 million, or 9 percent, due largely to growth in maintenance services for its ATSG affiliates. Revenues from external customers decreased $6.2 million, or 14 percent versus the prior-year period, principally due to the termination of sort-facility management services for the U.S. Postal Service in the third quarter of 2018.
  • Pretax earnings increased $1 million, to $4 million. Higher earnings from aircraft maintenance and air network logistics services offset the loss of business with the U.S. Postal Service. During the second quarter of 2019, Amazon began the process of directly contracting for ground services which ATSG has been arranging for them at eight gateway locations. The transition is expected to be completed during August.

Outlook

ATSG continues to project that its Adjusted EBITDA will increase to $450 million in 2019 from $312 million in 2018. The majority of the projected Adjusted EBITDA growth from aircraft leasing activities is expected to occur during the second half, and flight operations for ATSG’s commercial customers are also expected to increase compared with first-half levels.

Costs to prepare for heavier second-half flight schedules will continue to affect results for the third quarter, as they did in the second. In addition to these ramp-up costs, ATSG expects aircraft lease transitioning costs to increase in the third quarter. As a result, more of the second-half Adjusted EBITDA growth is expected to occur in the fourth quarter than in the third quarter.

Capital expenditures are still projected to be approximately $475 million in 2019, principally to purchase and modify Boeing 767 aircraft for freighter deployments. The plan includes the purchase of six passenger 767s in the second half of 2019. One earlier purchased passenger 767 has been leased internally to Omni Air and entered charter service in July. CAM has commitments to lease more 767 freighters in 2020, including four for Amazon.

ATSG projects FAA approval by mid-2020 of the certificate application to produce a converted freighter variant of the Airbus A321-200. ATSG expects to invest $6 million in this joint venture with Precision Aircraft Solutions in the second half of 2019.

“Our growth investments are continuing to pay off in both revenue and cash flow in 2019, and will continue to do so in the years to come,” Hete said. “More than 80 percent of our 767 freighter fleet is deployed under long-term external leases, and our CMI, ACMI and charter flying will continue to grow through our key relationships with large commercial and government customers. Compared with air carriers with more payload-sensitive business models, the outlook for the e-commerce-driven regional air networks that drive our cash flow, remains very bright.”

Non-GAAP Financial Measures

This release, including the attached tables, contains non-GAAP financial measures that management uses to evaluate historical results and project future results. Management believes that these non-GAAP measures assist in highlighting operational trends, facilitate period-over-period comparisons, and provide additional clarity about events and trends affecting core operating performance. Disclosing these non-GAAP measures provides insight to investors about additional metrics that management uses to evaluate past performance and prospects for future performance. Non-GAAP measures are not a substitute for GAAP. The non-GAAP financial measures are reconciled to GAAP results in tables later in this release.

Conference Call

ATSG will host a conference call on August 6, 2019, at 10 a.m. Eastern time to review its financial results for the second quarter of 2019. Participants should dial (800) 708-4539 and international participants should dial (847) 619-6396 ten minutes before the scheduled start of the call and ask for conference pass code 48891939. The call will also be webcast live (in listen-only mode) via a link at www.atsginc.com. A replay of the conference call will be available by phone on August 6, 2019, beginning at 2 p.m. and continuing through August 13, 2019, at (888) 843-7419 (international callers (630) 652-3042; use pass code 48891939#). The webcast replay will remain available via www.atsginc.com for 30 days.

About ATSG

ATSG is a leading provider of aircraft leasing and air cargo transportation and related services to domestic and foreign air carriers and other companies that outsource their air cargo lift requirements. ATSG, through its leasing and airline subsidiaries, is the world’s largest owner and operator of converted Boeing 767 freighter aircraft. Through its principal subsidiaries, including three airlines with separate and distinct U.S. FAA Part 121 Air Carrier certificates, ATSG provides aircraft leasing, air cargo lift, passenger ACMI and charter services, aircraft maintenance services and airport ground services. ATSG’s subsidiaries include ABX Air, Inc.; Airborne Global Solutions, Inc.; Airborne Maintenance and Engineering Services, Inc., including its subsidiary, Pemco World Air Services, Inc.; Air Transport International, Inc.; Cargo Aircraft Management, Inc.; and Omni Air International, LLC. For more information, please see www.atsginc.com.

Except for historical information contained herein, the matters discussed in this release contain forward-looking statements that involve risks and uncertainties. A number of important factors could cause Air Transport Services Group’s (ATSG’s) actual results to differ materially from those indicated by such forward-looking statements. These factors include, but are not limited to, changes in market demand for our assets and services; our operating airlines’ ability to maintain on-time service and control costs; the cost and timing with respect to which we are able to purchase and modify aircraft to a cargo configuration; fluctuations in ATSG’s traded share price, which may result in mark-to-market charges on certain financial instruments; the number, timing and scheduled routes of our aircraft deployments to customers, our ability to remain in compliance with our agreements with key customers and lenders; changes in general economic and/or industry specific conditions; and other factors that are contained from time to time in ATSG’s filings with the U.S. Securities and Exchange Commission, including its Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Readers should carefully review this release and should not place undue reliance on ATSG’s forward-looking statements. These forward-looking statements were based on information, plans and estimates as of the date of this release. ATSG undertakes no obligation to update any forward-looking statements to reflect changes in underlying assumptions or factors, new information, future events or other changes.

AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(In thousands, except per share data)

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

 

2019

 

2018

 

2019

 

2018

REVENUES

$

334,576

 

 

$

203,607

 

 

$

682,759

 

 

$

406,647

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

Salaries, wages and benefits

97,850

 

 

74,049

 

 

197,191

 

 

144,832

 

Depreciation and amortization

63,266

 

 

41,620

 

 

125,903

 

 

81,624

 

Maintenance, materials and repairs

39,651

 

 

36,817

 

 

84,389

 

 

73,683

 

Fuel

33,984

 

 

5,913

 

 

68,734

 

 

11,701

 

Contracted ground and aviation services

14,531

 

 

2,444

 

 

30,129

 

 

4,828

 

Travel

20,937

 

 

7,288

 

 

41,035

 

 

13,920

 

Landing and ramp

2,391

 

 

1,311

 

 

5,439

 

 

2,459

 

Rent

3,984

 

 

3,760

 

 

7,737

 

 

6,990

 

Insurance

1,857

 

 

1,420

 

 

3,768

 

 

2,777

 

Transaction fees

 

 

 

 

373

 

 

 

Other operating expenses

18,643

 

 

5,087

 

 

34,051

 

 

12,292

 

 

297,094

 

 

179,709

 

 

598,749

 

 

355,106

 

 

OPERATING INCOME

37,482

 

 

23,898

 

 

84,010

 

 

51,541

 

OTHER INCOME (EXPENSE)

 

 

 

 

 

 

 

Net gain (loss) on financial instruments

(35,886

)

 

11,697

 

 

(31,386

)

 

10,812

 

Interest expense

(16,804

)

 

(5,366

)

 

(34,194

)

 

(10,728

)

Non-service component of retiree benefit (costs) credits

(2,351

)

 

2,045

 

 

(4,702

)

 

4,090

 

Loss from non-consolidated affiliates

(5,998

)

 

(2,417

)

 

(9,814

)

 

(4,953

)

Interest income

81

 

 

54

 

 

177

 

 

77

 

 

(60,958

)

 

6,013

 

 

(79,919

)

 

(702

)

 

 

 

 

 

 

 

 

EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES

(23,476

)

 

29,911

 

 

4,091

 

 

50,839

 

INCOME TAX EXPENSE

(3,156

)

 

(5,447

)

 

(8,089

)

 

(10,693

)

 

 

 

 

 

 

 

 

EARNINGS (LOSS) FROM CONTINUING OPERATIONS

(26,632

)

 

24,464

 

 

(3,998

)

 

40,146

 

 

 

 

 

 

 

 

 

EARNINGS FROM DISCONTINUED OPERATIONS, NET OF TAX

31

170

 

62

366

NET EARNINGS (LOSS)

$

(26,601

)

 

$

24,634

 

 

$

(3,936

)

 

$

40,512

 

 

 

 

 

 

 

 

 

EARNINGS (LOSS) PER SHARE – CONTINUING OPERATIONS

 

 

 

 

 

 

 

Basic

$

(0.45

)

 

$

0.42

 

 

$

(0.07

)

 

$

0.68

 

Diluted

$

(0.45

)

 

$

0.21

 

 

$

(0.07

)

 

$

0.48

 

 

 

 

 

 

 

 

 

WEIGHTED AVERAGE SHARES – CONTINUING OPERATIONS

 

 

 

 

 

 

 

Basic

58,909

 

 

58,739

 

 

58,874

 

 

58,790

 

Diluted

58,909

 

 

68,363

 

 

58,874

 

 

68,784

 

Certain historical expenses have been reclassified to conform to the presentation above.

AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

 

June 30,

 

December 31,

 

2019

 

2018

ASSETS

 

 

 

CURRENT ASSETS:

 

 

 

Cash and cash equivalents

$

54,784

 

 

$

59,322

 

Accounts receivable, net of allowance of $2,716 in 2019 and $1,444 in 2018

128,514

 

 

147,755

 

Inventory

36,477

 

 

33,536

 

Prepaid supplies and other

19,092

 

 

18,608

 

TOTAL CURRENT ASSETS

238,867

 

 

259,221

 

 

 

 

 

Property and equipment, net

1,650,612

 

 

1,555,005

 

Lease incentive

155,605

 

 

63,780

 

Goodwill and acquired intangibles

533,371

 

 

535,359

 

Operating lease assets

57,576

 

 

 

Other assets

67,285

 

 

57,220

 

TOTAL ASSETS

$

2,703,316

 

 

$

2,470,585

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

CURRENT LIABILITIES:

 

 

 

Accounts payable

$

122,092

 

 

$

109,843

 

Accrued salaries, wages and benefits

49,068

 

 

50,932

 

Accrued expenses

14,212

 

 

19,623

 

Current portion of debt obligations

39,236

 

 

29,654

 

Current portion of lease obligations

15,770

 

 

 

Unearned revenue

18,637

 

 

19,082

 

TOTAL CURRENT LIABILITIES

259,015

 

 

229,134

 

Long term debt

1,402,782

 

 

1,371,598

 

Stock warrant obligations

401,441

 

 

203,782

 

Post-retirement obligations

59,738

 

 

64,485

 

Long term lease obligations

40,573

 

 

 

Other liabilities

50,882

 

 

51,905

 

Deferred income taxes

118,076

 

 

113,243

 

 

 

 

 

STOCKHOLDERS’ EQUITY:

 

 

 

Preferred stock, 20,000,000 shares authorized, including 75,000 Series A Junior Participating Preferred Stock

 

 

 

Common stock, par value $0.01 per share; 150,000,000 shares authorized; 59,363,839 and 59,134,173 shares issued and outstanding in 2019 and 2018, respectively

594

 

 

591

 

Additional paid-in capital

473,053

 

 

471,158

 

Retained earnings (accumulated deficit)

(19,243

)

 

56,051

 

Accumulated other comprehensive loss

(83,595

)

 

(91,362

)

TOTAL STOCKHOLDERS’ EQUITY

370,809

 

 

436,438

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

$

2,703,316

 

 

$

2,470,585

 

AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES

PRETAX EARNINGS AND ADJUSTED PRETAX EARNINGS SUMMARY

FROM CONTINUING OPERATIONS

NON-GAAP RECONCILIATION

(In thousands)

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

 

2019

 

2018

 

2019

 

2018

Revenues

 

 

 

 

 

 

 

CAM

 

 

 

 

 

 

 

Aircraft leasing and related revenues

$

73,280

 

 

$

58,603

 

 

$

147,857

 

 

$

115,205

 

Lease incentive amortization

(4,024

)

 

(4,226

)

 

(8,251

)

 

(8,452

)

Total CAM

69,256

 

 

54,377

 

 

139,606

 

 

106,753

 

ACMI Services

254,938

 

 

119,606

 

 

512,894

 

 

238,980

 

Other Activities

71,104

 

 

65,361

 

 

138,466

 

 

137,259

 

Total Revenues

395,298

 

 

239,344

 

 

790,966

 

 

482,992

 

Eliminate internal revenues

(60,722

)

 

(35,737

)

 

(108,207

)

 

(76,345

)

Customer Revenues

$

334,576

 

 

$

203,607

 

 

$

682,759

 

 

$

406,647

 

 

 

 

 

 

 

 

 

Pretax Earnings (Loss) from Continuing Operations

 

 

 

 

 

 

CAM, inclusive of interest expense

16,683

 

 

15,394

 

 

32,857

 

 

30,858

 

ACMI Services, inclusive of interest expense

973

 

 

500

 

 

13,283

 

 

3,915

 

Other Activities

4,006

 

 

3,039

 

 

5,909

 

 

6,757

 

Net, unallocated interest expense

(903

)

 

(347

)

 

(1,683

)

 

(640

)

Net gain (loss) on financial instruments

(35,886

)

 

11,697

 

 

(31,386

)

 

10,812

 

Other non-service components of retiree benefit (costs) credits, net

(2,351

)

 

2,045

 

 

(4,702

)

 

4,090

 

Transaction fees

 

 

 

 

(373

)

 

 

Non-consolidated affiliates

(5,998

)

 

(2,417

)

 

(9,814

)

 

(4,953

)

Earnings (Loss) from Continuing Operations before Income Taxes (GAAP)

$

(23,476

)

 

$

29,911

 

 

$

4,091

 

 

$

50,839

 

 

 

 

 

 

 

 

 

Adjustments to Pretax Earnings

 

 

 

 

 

 

Add non-service components of retiree benefit costs (credits), net

2,351

 

 

(2,045

)

 

4,702

 

 

(4,090

)

Add loss from non-consolidated affiliates

5,998

 

 

2,417

 

 

9,814

 

 

4,953

 

Add transaction fees

 

 

 

 

373

 

 

 

Add lease incentive amortization

4,024

 

 

4,226

 

 

8,251

 

 

8,452

 

Add net (gain) loss on financial instruments

35,886

 

 

(11,697

)

 

31,386

 

 

(10,812

)

Adjusted Pretax Earnings (non-GAAP)

$

24,783

 

 

$

22,812

 

 

$

58,617

 

 

$

49,342

 

Adjusted Pretax Earnings excludes certain items included in GAAP based pretax earnings (loss) from continuing operations because they are distinctly different in their predictability among periods or not closely related to our operations. Presenting this measure provides investors with a comparative metric of fundamental operations, while highlighting changes to certain items among periods. Adjusted Pretax Earnings should not be considered an alternative to Earnings from Continuing Operations Before Income Taxes or any other performance measure derived in accordance with GAAP.

AIR TRANSPORT SERVICES GROUP, INC. AND SUBSIDIARIES

ADJUSTED EARNINGS FROM CONTINUING OPERATIONS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION

NON-GAAP RECONCILIATION

(In thousands)

 

Three Months Ended

 

Six Months Ended

 

June 30,

 

June 30,

 

2019

 

2018

 

2019

 

2018

 

 

 

 

 

 

 

 

Earnings (loss) from Continuing Operations Before Income Taxes

$

(23,476

)

 

$

29,911

 

 

$

4,091

 

 

$

50,839

 

Interest Income

(81

)

 

(54

)

 

(177

)

 

(77

)

Interest Expense

16,804

 

 

5,366

 

 

34,194

 

 

10,728

 

Depreciation and Amortization

63,266

 

 

41,620

 

 

125,903

 

 

81,624

 

EBITDA from Continuing Operations (non-GAAP)

$

56,513

 

 

$

76,843

 

 

$

164,011

 

 

$

143,114

 

Add non-service components of retiree benefit costs (credits), net

2,351

 

 

(2,045

)

 

4,702

 

 

(4,090

)

Add losses for non-consolidated affiliates

5,998

 

 

2,417

 

 

9,814

 

 

4,953

 

Add acquisition related transaction fees

 

 

 

 

373

 

 

 

Add lease incentive amortization

4,024

 

 

4,226

 

 

8,251

 

 

8,452

 

Add net (gain) loss on financial instruments

35,886

 

 

(11,697

)

 

31,386

 

 

(10,812

)

 

 

 

 

 

 

 

 

Adjusted EBITDA (non-GAAP)

$

104,772

 

 

$

69,744

 

 

$

218,537

 

 

$

141,617

 

Management uses Adjusted EBITDA to assess the performance of its operating results among periods. It is a metric that facilitates the comparison of financial results of underlying operations. Additionally, these non-GAAP adjustments are similar to the adjustments used by lenders in the Company’s Senior Credit Agreement to assess financial performance and determine the cost of borrowed funds. The adjustments also exclude the non-service cost components of retiree benefit plans because they are not closely related to ongoing operating activities. Management presents EBITDA from Continuing Operations, a commonly referenced metric, as a subtotal toward computing Adjusted EBITDA.

EBITDA from Continuing Operations is defined as Earnings (Loss) from Continuing Operations Before Income Taxes plus net interest expense, depreciation, and amortization expense. Adjusted EBITDA is defined as EBITDA from Continuing Operations less financial instrument revaluation gains or losses, non-service components of retiree benefit costs including pension plan settlements, amortization of lease incentive costs recorded in revenue, and costs from non-consolidated affiliates.

Adjusted EBITDA and EBITDA from Continuing Operations are non-GAAP financial measures and should not be considered as alternatives to Earnings from Continuing Operations Before Income Taxes or any other performance measure derived in accordance with GAAP.

Contacts

Quint Turner, ATSG Inc. Chief Financial Officer

937-366-2303

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Author: dmnnewswire