DENVER, NC / ACCESSWIRE / August 14, 2020/Air T, Inc. (NASDAQ:AIRT) is an industrious American company with a portfolio of businesses, each of which is independent yet interrelated. We seek dynamic individuals and teams to operate companies using processes that increase value over time. We believe we can apply corporate resources to help activate growth and overcome challenges.
Our core segments are overnight air cargo; aviation ground support equipment manufacturing; and commercial aircraft asset management.
Today the Company is announcing results for the quarter ended June 30, 2020:
* Adjusted EBITDA is a non-GAAP financial measure; see "Non-GAAP Financial Measures" (below) further explanation and reconciliation to GAAP measure.
Company Chairman and CEO Nick Swenson said:
"Our June 2020 Quarter just ended reflects a brutal blow from Covid, particularly impactful on our aircraft parts trading and leasing businesses. We are working to do more with less revenue and activity. This is a challenge, yet made somewhat easier because we are a small company-therefore able to maneuver and flex more easily. And AIRT has a diversified set of businesses.
The PPP loan and the prospect of its forgiveness has allowed us to retain almost all of our employees. And we are grateful for the government's fiscal response and opportunity to keep our highly skilled teams together. It's been a struggle and we continue to operate in a highly uncertain environment. Operating dynamics change week by week. For example, several businesses have had to re-institute Covid restrictions after partial reductions several weeks ago. We remain vigilant and focused on protecting our people.
Progress. We've made some by finding the right person to lead our air cargo operations. Mike Bandalan, longtime MAC executive, was promoted to be the MAC/CSA CEO in Spring 2019. He and his team have done an absolutely stellar job of transforming MAC back to the future. He has strengthened our relationship with FedEx and set up his organization to take on more and bigger challenges. Congrats, Mike Bandalan, on leading your organization through to a better place, and for building the organizational confidence that comes with executing a business plan successfully!
Long-time AIRT shareholders will have noticed that we added an interactive Q&A capability, through Slido.com, to our annual meeting process. We intend to keep that link (https://app.sli.do/event/j8drfixw) open and available for shareholder questions. Relevant questions will be answer "live" at the annual meeting or via a written response on a quarterly basis, coincident with our 10Q filings. Note that legal and pragmatic requirements will not allow us to answer every question posted, yet we intend to address all reasonable and relevant questions with a written answer. We hope that continuous Q&A, along with improvements in reporting by our able new CFO Brian Ochocki, will be welcome improvements in time. We aspire to provide the right pixelation, delivering insight into our operations, without noise and distraction. Your participation in an ongoing Q&A with management will help this process along. Thank you in advance."
Business Segment Results
Overnight Air Cargo
Aviation Ground Support Equipment
Commercial Jet Engines and Parts
Corporate and Other
* Adjusted EBITDA is a non-GAAP financial measure; see "Non-GAAP Financial Measures" (below) further explanation and reconciliation to GAAP measure.
Non-GAAP Financial Measures
The Company uses adjusted earnings before taxes, interest, and depreciation and amortization ("Adjusted EBITDA"), a non-GAAP financial measure as defined by the SEC, to evaluate the Company's financial performance. This performance measure is not defined by accounting principles generally accepted in the United States and should be considered in addition to, and not in lieu of, GAAP financial measures.
Adjusted EBTDA is defined as earnings before taxes, interest, and depreciation and amortization, adjusted for specified items. The Company calculates Adjusted EBITDA by removing the impact of specific items and adding back the amounts of interest expense and depreciation and amortization to earnings before income taxes. When calculating Adjusted EBITDA, the Company does not add back depreciation expense for aircraft engines that are on lease, as the Company believes this expense matches with the corresponding revenue earned on engine leases. Depreciation expense for leased engines totaled $0.2 million and $1.6 million for the quarters ended June 30, 2020 and 2019, respectively.
Management believes that Adjusted EBITDA is a useful measure of the Company's performance because it provides investors additional information about the Company's operations allowing better evaluation of underlying business performance and better period-to-period comparability. Adjusted EBITDA is not intended to replace or be an alternative to Operating Income from Continuing Operations, the most directly comparable amounts reported under GAAP.
The tables below provide a reconciliation of Operating Income from Continuing Operations to Adjusted EBITDA and Adjusted EBITDA for the consolidated entity and by segment for the quarters ended June 30, 2020 and 2019 (in thousands):
6/30/2020 | 6/30/2019 | ||||||||||
Operating income from continuing operations | $ | (266 | ) | $ | 998 | ||||||
Depreciation and amortization (excluding leased engines depreciation) | 353 | 303 | |||||||||
Asset impairment, restructuring or impairment charges | - | 7 | |||||||||
(Gains)/Losses on disposition of assets | - | (4 | ) | ||||||||
Security issuance expenses | - | 235 | |||||||||
Adjusted EBITDA | $ | 87 | $ | 1,539 | |||||||
6/30/2020 | 6/30/2019 | ||||||||||
Overnight Air Cargo | $ | 570 | $ | 36 | |||||||
Ground Equipment Sales | 2,284 | 1,400 | |||||||||
Commercial Jet Engines and Parts | (775 | ) | 1,981 | ||||||||
Printing Equipment and Maintenance | (221 | ) | (381 | ) | |||||||
Corporate and Other | (1,771 | ) | (1,497 | ) | |||||||
Adjusted EBITDA | $ | 87 | $ | 1,539 | |||||||
ABOUT AIR T, INC.
Established in 1980, Air T Inc. is a portfolio of powerful businesses and financial assets, each of which is independent yet interrelated. Its core segments are overnight air cargo, aviation ground support equipment manufacturing, and commercial aircraft asset management and logistics. We seek to expand, strengthen and diversify Air T's after-tax cash flow per share. Our goal is to build Air T's core businesses, and when appropriate, to expand into adjacent and other industries. We seek to activate growth and overcome challenges while delivering meaningful value for all stakeholders. For more information, visit www.airt.net.
FORWARD-LOOKING STATEMENTS
Certain matters discussed in this press release may be considered forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). These forward-looking statements are subject to risks, uncertainties and assumptions about our operations and the investments we make, including, among other things, factors discussed under the heading "Risk Factors" in our 10-K, as well as the following:
Forward-looking statements can be identified by the use of words like "believes," "could," "possibly," "probably," "anticipates," "estimates," "projects," "expects," "may," "will," "should," "seek," "intend," "plan," "expect," or "consider" or the negative of these expressions or other variations, or by discussions of strategy that involves risks and uncertainties. All forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual transactions, results, performance or achievements to be materially different from any future transactions, results, performance or achievements expressed or implied by such forward-looking statements. We base these forward-looking statements on current expectations and projections about future events and the information currently available to us. Although we believe that the assumptions for these forward-looking statements are reasonable, any of the assumptions could prove to be inaccurate. Consequently, no representation or warranty can be given that the estimates, opinions, or assumptions made in or referenced in this press release will prove to be accurate. We undertake no obligation to update our forward-looking statements. We caution you that the forward-looking statements in this press release are only estimates and predictions, or statements of current intent. Actual results or outcomes, or actions that we ultimately undertake, could differ materially from those anticipated in the forward-looking statements due to risks, uncertainties or actual events differing from the assumptions underlying these statements. These risks, uncertainties and assumptions include, but are not limited to, those discussed in this press release.
CONTACT
Air T, Inc.Brian Ochocki, CFObochocki@airt.net612-843-4302
SOURCE:Air T, Inc.
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