Boston, MA 05/08/2014 (wallstreetpr) – The provider of aircraft leases and maintenance Air Transport Services Group Inc. (NASDAQ:ATSG) has announced a new deal with a long-time customer. The company expects the new aircraft dry-lease agreement to also support its service arm as has been the case in the previous transactions.
The company announced a deal to lease two B767-200ER freighters for up to three years to Cargojet, a Canadian company. The aircrafts will be leased without the crew, constitution what is called “dry-lease” in aviation.
Cargojet is a long-time customer that already has two B767-200Fs on long-term dry-lease from Air Transport Services Group Inc. (NASDAQ:ATSG) through the subsidiary Cargo Aircraft Management (CAM).
Under the new dry-lease agreement, the first aircraft is scheduled for delivery by the end of 2Q2014, following with the second one early 3Q2014.
According to ATSG president and CEO Joe Hete, Cargo has immediate plans for the new dry-leases, and that explains the speedy delivery timeline. He went on to praise the good and longstanding relationships that the companies have had and believe that the latest deal will expand their service capacity.
Fleet renewal
Cargojet is in the process of fleet renewal and the latest two additional aircrafts will be part of the company’s current growth effort, the CEO Ajay Virmani said.
The changing package delivery and cargo transportation environment means that players need better and more equipment to meet the market demand, and that explains why Cargojet is going above and beyond to renew its fleet.
Air Transport Services Group Inc. (NASDAQ:ATSG) looks to lease about 23 of its 767 freighters on long-term agreements by the end of 3Q2014. The leases will be made through CAM to external customers, and additional aircrafts are expected to be leased to subsidiaries.
1Q financial performance
Air Transport Services Group Inc. (NASDAQ:ATSG) had little to celebrate about its 1Q2014 results. The company earned 10 cents per share, missing consensus estimate of 11 cents per share. Revenue also fell short of expectation, coming in at $143.59 million against the consensus estimate of $148.95 million. However, on a year-over-year basis, revenue was up 2 percent.
