Pilots for the Air Transport Services Group (NASDAQ:ATSG) unit that hauls packages for Amazon (NASDAQ:AMZN) and DHL have been ordered back to work by a federal judge, halting a strike that threatened to disrupt holiday deliveries.
"The public expects that purchases and shipments will be delivered in a timely fashion," U.S. District Judge Timothy Black said in the ruling. "Absent an injunction, ABX, its customers and the public will suffer immediate, irreparable harm. Imagine Christmas without Amazon!"
The pilots walked off the job early Tuesday over what they said were violations of their collective bargaining agreement, but Judge Black said there was "no evidence" to support their claims.
Amazon (NASDAQ:AMZN) will reveal its first branded cargo plane, Amazon One, at Seattle's SeaFair Air Show today, emblazoned with "Amazon" on its belly, "Prime Air" on its sides and the Amazon smile logo on its tail.
The freighter jet is among a fleet of 40 leased from Atlas (NASDAQ:AAWW) and Air Transport Services Group (NASDAQ:ATSG) to improve a supply chain straining to keep pace with the retailer’s growing sales and swelling ranks of Prime members.
Air Transport Services Group (NASDAQ:ATSG) has added another $100M to its stock repurchase authorization, in a move to combat some potential dilution ahead.
The company had a $50M buyback authorization from August 2014, and has bought back about $18.3M under that program.
The new move is meant to "accommodate an accelerated pace of share repurchases by ATSG," says CEO Joe Hete, considering the potential dilutive effects of warrants granted to its customer Amazon.com.
The warrants are for the purchase of up to 19.9% of ATSG common shares through March 2021. Shares fell in March after details about Amazon's warrants emerged in filings, though they had jumped on news of the two companies' air cargo network deal.
Air Transport Services Group (NASDAQ:ATSG) is down 2.1% after hours to $14.25 after filing a 13G stating Amazon (NASDAQ:AMZN) was granted a warrant on March 8 that can be exercised to acquire 7.1M shares (a 10% stake) upon the earlier of ATSG's next shareholder meeting and July 8. The shares are currently worth $101M.
Amazon could obtain another 5.7M shares through the warrant "upon the achievement of certain commercial milestones." The disclosure comes a week after Amazon and ATSG announced a deal through which the latter will operate a U.S. air cargo network for the former, with Amazon leasing 20 Boeing 767 jets along the way.
At the time, the companies said Amazon is receiving warrants to buy a 19.9% stake in ATSG over a 5-year period, at a price of $9.73/share (ATSG's Feb. 9 close).
UPS (UPS +1.7%), XPO Logistics (XPO +3.6%), and Air Transport Services Group (ATSG +0.8%), C.H. Robinson Worldwide (CHRW +0.8%), and Expeditors International (EXPD +1.2%) are all out ahead of broad market averages after results at FedEx shine.
Some confident talk from FedEx execs on the firm's conference call over the threat of Amazon may be doing the trick as much as the improved operating margin rate put in by the shipper.