Form 10-Q
Flyinboxes,
Yep, you're right. It took a little digging -- looks as if they released this COB Friday:
DHL INTEGRATION PLANS
As a result of their merger, DHL and Airborne are in the process of integratingtheir combined product offerings, sales, marketing, administrative and operatingresources. After August 15, 2004, Airborne may terminate specific ACMI aircraft,add to, delete or modify the air routes we operate under the ACMI agreement andadd to, delete or modify services we provide under the Hub Services agreement.DHL has informed ABX that, in an effort to eliminate duplicate costs, it isdeveloping plans to better integrate its U.S. operations (both air and ground).We anticipate that plans will be finalized later this year for implementationduring late 2005 and early 2006 that will call for a reduction in the number ofaircraft provided to Airborne by ABX under the ACMI agreement. At this time, itis uncertain to us how many ABX aircraft will eventually be removed from serviceand the timing of the reductions. Additionally, DHL is developing integrationplans that would consolidate the operations of the Wilmington hub, which weoperate, and the Northern Kentucky hub, which it operates. While the financialimpact of any changes in ACMI or hub services that we provide will vary with theintegration plans ultimately adopted by DHL, we currently expect that, whenimplemented, the integration plans will significantly affect our operations andmay materially reduce our net earnings.
Pursuant to the terms of the ACMI agreement, we have certain rights to sell toAirborne the aircraft that are removed from service. We anticipate that theapproximate number of aircraft to be removed from service and a final decisionregarding the consolidation of the hub operations will be disclosed by DHL bythe end 2004.
