By Doug Cameron 

The U.S. withdrawal from Afghanistan is having a tougher-than-expected impact on cargo airlines that have been profitably flying troops and equipment to and from the warzone during the military buildup of the last decade, Atlas Air Worldwide Holdings Inc. said on Wednesday.

The parent of Atlas Air, one of the largest carriers of air cargo for the U.S. military, said that military planners had over-estimated how much flying they required. The company expects the drop in business to knock 70 cents from per-share earnings this year compared to 2013.

The U.S. pullback from central Asia has reduced demand for everything from food and tents to radios and trucks for the military, but the multibillion-dollar logistics business that grew during the twin wars in Afghanistan and Iraq has expected to profit from the drawdown as troops and supplies were moved back to the U.S.

Purchase, N.Y.-based Atlas generated almost 30% of its revenue from U.S. military flying when demand peaked in 2010. That share dropped to 21.5% last year after revenue fell by a third in the final quarter from the same period of 2012.

"The decline [in 2014] will also be steeper and faster than previously forecast by the military," Atlas Chief Executive Bill Flynn said on a post-earnings' call Wednesday.

Atlas reported that net profit fell to $30 million in the fourth quarter from $52.4 million a year earlier. Per-share earnings dropped to $1.19 from $1.97 for the quarter. For the full year, Atlas reported earnings of $3.67 a share. Before Wednesday's comments, analysts had expected it to earn $3.85 a share this year. Its shares were recently down 5.5% at $31.90.

The Pentagon still provides valuable business for U.S. airlines, even though annual revenue has fallen from its peak above $3 billion in 2010. The Air Mobility Command unit of the U.S. Air Force said that 26 carriers were enrolled in the program to carry troops and cargo as of January.

Airlines are grouped in three teams to compete for Pentagon business, which the government awards based on how many planes they commit to military contracts, as well as the value of the bids for what are usually fixed-price deals. Atlas is a member of the team led by FedEx Corp. that also includes Delta Air Lines Inc. United Parcel Service Inc. heads a second group.

Air Mobility Command didn't offer immediate comment on whether its needs had shrunk from earlier guidance provided to industry. Atlas said the military had been using more of its own aircraft.

Military flying was more profitable for airlines during the previous decade, as half the work involved one-way flights to Iraq and Afghanistan from the U.S. The Pentagon paid for the bulk of the costs, and airlines were able to earn extra revenue by continuing on to Asia and picking up cargo to carry on to the U.S. Atlas said only 10% of flights were now one-way, most of them from Afghanistan, forcing it to find other cargo to carry on the outward leg.

Atlas has diversified from military business, and the bulk of its revenue is from renting large freighter aircraft to other airlines and cargo specialists, though in 2011 it started flying passengers as well as freight for the Pentagon.

Write to Doug Cameron at doug.cameron@wsj.com

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