starcheck1
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AirNet Systems, Inc. Announces Impairment Charges
November 05, 2004 4:22:00 PM ET
COLUMBUS, Ohio, Nov. 5 /PRNewswire-FirstCall/ -- AirNet Systems, Inc. ANS today announced non-cash impairment charges of $47.0 million ($31.0 million after-tax) related to its cargo business for the third quarter 2004. The impairment charges, which impact the company's cargo aircraft assets by $43.0 million and goodwill by $4.0 million, were caused by changing conditions in its Bank services business. The impairment charges are $3.07 per diluted share. AirNet plans to release its third quarter financial results by November 15, 2004.
The non-cash impairment charges, in accordance with FASB 142 and 144, are primarily based on recent industry trends which confirm adoption of electronic alternatives to the physical movement of cancelled checks at a more rapid pace than previously anticipated by the industry. Enactment of the Check 21 Act in October 2004 will contribute to this trend. AirNet's cargo airline was originally designed, and continues to operate, primarily to meet the needs of Bank services customers. AirNet believes that its airline capacity will exceed future demand, creating an impairment of the aircraft and related assets. The impairment also reflects the overall decline in the market values of the aircraft in its cargo fleet which have not recovered as in previous economic cycles.
"We have previously reported that we believe our Bank services revenues will decline as a result of our Bank customers' migration to electronic alternatives from the physical movement of cancelled checks," said Joe Biggerstaff, Chairman, CEO and President. "Although the exact timing of the volume declines and the impact on revenues is still difficult to predict, it is clear from market data and other disclosures by the Federal Reserve that cancelled check volume declines are accelerating. As a result of these factors, we are planning for a significant decrease in cancelled check volume and related Bank services revenues beginning in 2006 or 2007." Mr. Biggerstaff continued, "AirNet remains committed to providing best-in- class service to our Bank, Express and Passenger Charter customers. We are aggressively pursuing growth and diversification opportunities in several markets as we build our company's future. We will continue to analyze strategic alternatives for our company's transition, and will consider the use of an investment banker in the development and evaluation of those alternatives."
November 05, 2004 4:22:00 PM ET
COLUMBUS, Ohio, Nov. 5 /PRNewswire-FirstCall/ -- AirNet Systems, Inc. ANS today announced non-cash impairment charges of $47.0 million ($31.0 million after-tax) related to its cargo business for the third quarter 2004. The impairment charges, which impact the company's cargo aircraft assets by $43.0 million and goodwill by $4.0 million, were caused by changing conditions in its Bank services business. The impairment charges are $3.07 per diluted share. AirNet plans to release its third quarter financial results by November 15, 2004.
The non-cash impairment charges, in accordance with FASB 142 and 144, are primarily based on recent industry trends which confirm adoption of electronic alternatives to the physical movement of cancelled checks at a more rapid pace than previously anticipated by the industry. Enactment of the Check 21 Act in October 2004 will contribute to this trend. AirNet's cargo airline was originally designed, and continues to operate, primarily to meet the needs of Bank services customers. AirNet believes that its airline capacity will exceed future demand, creating an impairment of the aircraft and related assets. The impairment also reflects the overall decline in the market values of the aircraft in its cargo fleet which have not recovered as in previous economic cycles.
"We have previously reported that we believe our Bank services revenues will decline as a result of our Bank customers' migration to electronic alternatives from the physical movement of cancelled checks," said Joe Biggerstaff, Chairman, CEO and President. "Although the exact timing of the volume declines and the impact on revenues is still difficult to predict, it is clear from market data and other disclosures by the Federal Reserve that cancelled check volume declines are accelerating. As a result of these factors, we are planning for a significant decrease in cancelled check volume and related Bank services revenues beginning in 2006 or 2007." Mr. Biggerstaff continued, "AirNet remains committed to providing best-in- class service to our Bank, Express and Passenger Charter customers. We are aggressively pursuing growth and diversification opportunities in several markets as we build our company's future. We will continue to analyze strategic alternatives for our company's transition, and will consider the use of an investment banker in the development and evaluation of those alternatives."
