Profile: Air Transport Services Group Inc (ATSG.O)

ATSG.O on Nasdaq

8 Feb 2016
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Air Transport Services Group, Inc. (ATSG), incorporated on September 5, 2007, is a holding company. Through its subsidiaries, the Company provides aircraft leasing, airline operations, aircraft maintenance and other support services to the air cargo transportation and package delivery industries. The Company offers a range of services to delivery companies, freight forwarders, airlines and Government customers. ATSG's leasing subsidiary, Cargo Aircraft Management, Inc. (CAM) leases cargo aircraft to ATSG's airlines and to external customers. Airborne Global Solutions, Inc. (AGS) is its subsidiary that assists its businesses in marketing plans and provides sales leads to its subsidiaries by identifying customers' business and operational requirements. The Company's other business operations, including aircraft maintenance and modification services, aircraft part sales, equipment leasing and maintenance and mail handling for the United States Postal Service (USPS).


As of December 31, 2014, CAM's fleet consisted of 53 serviceable Boeing 767 and 757 cargo aircraft. CAM leases aircraft to ATSG's airlines and to external customers, including DHL, usually under multi-year contracts with a schedule of fixed monthly payments. Under a typical lease arrangement, the customer maintains the aircraft in serviceable condition at its own cost. At the end of the lease term, the customer is typically required to return the aircraft in approximately the same maintenance condition that existed at the inception of the lease, as measured by airframe and engine time since the last scheduled maintenance event.

ACMI Services

Through the Company's two airline subsidiaries, it provides airline operations to DHL, other airlines, freight forwarders and the United States Military. A typical operating agreement requires its airline to supply, at a specific rate per block hour or per month, ACMI for specified cargo operations. The customer is responsible for all other aircraft operating expenses, including fuel, landing fees, parking fees and ground and cargo handling expenses. The airlines also operate charter agreements, including with the United States Military, which require the airline to provide service, including fuel and other operating expenses, in addition to aircraft, crew, maintenance and insurance. Its airlines operate medium payload and medium wide-body aircraft freighters usually on intra-continental flights and medium range inter-continental flights. The airlines typically operate its aircraft in the customers' regional networks that connect to and from cargo networks. Its airlines provide airlift to the Air Mobility Command (AMC) through contracts by the United States Transportation Command (USTC), both of which are organized under the United States Military. ATI contracts with the AMC for the operation of its fleet of four Boeing 757 combi aircraft, which are capable of simultaneously carrying passengers and cargo containers on the main flight deck.

Aircraft Maintenance and Modification Services

The Company provides aircraft maintenance and modification services to other air carriers through its ABX and Airborne Maintenance and Engineering Services, Inc. (AMES) subsidiaries. They own Supplemental Type Certificates (STCs). An STC authorizes the alteration of an airframe, engine or component. AMES operates a Federal Aviation Administration (FAA) certificated 145 repair station in Wilmington, Ohio, including hangars, a component shop and engineering capabilities. AMES' marketable capabilities include the installation of avionics systems and flat panel displays for Boeing 757 and 767 aircraft. The flat panel display modernizes aircraft avionics equipment by combining multiple display units into a single instrumentation panel. In 2014, the Company completed the construction of a new hangar facility bringing the total hangar square footage to 310,000. AMES has the capability to perform line maintenance and airframe maintenance on McDonnell Douglas DC-9, MD-80, Boeing 767, 757, 737, 777, 727 and Airbus A320 aircraft. AMES also has the capability to refurbish airframe components.

Aircraft Parts Sales and Brokerage

AMES Material Services, Inc. (AMS) is an Aviation Suppliers Association 100 Certified reseller and broker of aircraft parts. AMS carries an inventory of Boeing 767, DC-9 and DC-8 spare parts and also maintains inventory on consignment from original equipment manufacturers, resellers, lessors and other airlines. AMS customers include the commercial air cargo industry, passenger airlines, aircraft manufacturers and contract maintenance companies serving the commercial aviation industry, as well as other resellers.

Equipment and Facility Maintenance

LGSTX Services, Inc. (LGSTX) provides contract maintenance services for material handling equipment and aviation ground support equipment throughout the United States. LGSTX has an inventory of ground support equipment, such as power units, airstarts, deicers and pushback vehicles that it rents to airports, airlines and other customers. LGSTX also resells aircraft fuel.

The United States Postal Service

The Company provides mail sorting services under contracts with the USPS. Its subsidiary, LGSTX Distribution Services, Inc. (LDS), which manages USPS mail sort centers in Indianapolis, Dallas and Memphis. LDS provides labor for load transfer services to the USPS at two facilities. LDS also provides international mail forwarding services through the Miami International Airport and the Los Angeles International Airport.

Flight Support

ABX offers flight crew training to customers and rent usage of its flight simulators for outside training programs. ABX has three flight simulators in operation. ABX's Boeing 767 and DC-9 flight simulators are level C certified. The DC-8 simulator is level B certified. The Company's GFS business provides aircraft dispatch and flight monitoring to ABX and ATI. GFS can provide these services to the United States certificated supplemental air carriers and foreign air carriers.

The Company competes with Amerijet International, Inc., Atlas Air Worldwide Holdings, Inc., Kalitta Air LLC, National Air Cargo Group, Inc., Southern Air, Inc., DHL, TNT Holdings B.V., the USPS, FedEx Corporation and United Parcel Service, Inc.

Company Address

Air Transport Services Group Inc

P: +1937.3825591
F: +1302.6365454

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