AirTran Holdings Reports Net Income of $1.2 Million for Third Quarter 2002; Unit Costs Decline by 8.8 Percent and Traffic Increases 28.8 Percent.Business Editors ORLANDO Orlando, city, United States Orlando (ôrlăn`dō), city (1990 pop. 164,693), seat of Orange co., central Fla., in a lake region; inc. 1875. In a citrus fruit and farm area, it is one of the world's most visited vacation spots. , Fla.--(BUSINESS WIRE)--Oct. 23, 2002 AirTran Holdings AirTran Holdings (NYSE: AAI) is a Nevada corporation that operates as an airline holding company. Its primary asset is AirTran Airways. History After the large amount of negative publicity surrounding the Flight 592 incident, ValuJet Airlines suffered serious , Inc. (NYSE NYSE See: New York Stock Exchange :AAI AAI American Association of Immunologists. ), the parent company of AirTran Airways AirTran Airways is a low-cost airline that is a Delaware corporation with headquarters in Orlando, Florida, USA and is a subsidiary of AirTran Holdings. AirTran operates over 750 daily flights throughout the eastern USA and the Midwest, including over 270 daily departures from , Inc., today reported net income for the quarter ending September September: see month. 30, 2002, of $1.2 million or $0.02 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share versus a loss of $10.6 million or $0.15 per diluted share in the year-earlier period. Included in third quarter 2002 net income is a credit of $0.6 million or $0.01 per diluted share, representing an adjustment to amounts received under a government grant program. The third quarter of 2001 results included special items and non-recurring charges, net of tax, of $4.5 million or $0.06 per diluted share. "We are pleased to announce our second consecutive quarter of profitability and continued optimism Optimism See also Hope. Bontemps, Roger personification of cheery contentment. [Fr. Lit.: “Roger Bontemps” in Walsh Modern, 66] Candide beset by inconceivable misfortunes, hero indifferently shrugs them off. [Fr. for year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. financial success, following the events of last year," said Joe Leonard For the baseball player, see . Joe Leonard (born August 4, 1932, San Diego, California), is a retired American motorcycle racer and racecar driver. Leonard won the first AMA Grand National Championship Series in 1954 and won it again in 1956 and 1957. , chairman and chief executive officer. "We are deeply grateful to the growing numbers of loyal AirTran Airways customers and thank them for their continued support." During the third quarter, total operating revenue operating revenue Revenue from any regular source. Revenue from sales is adjusted for discounts and returns when calculating operating revenue. Compare other revenue. increased 21.6 percent to $183.2 million on a traffic increase of 28.8 percent as measured in revenue passenger miles Revenue passenger miles (RPMs) is a measure of a passenger traffic for an airline flight, bus, or train calculated by multiplying the total number of revenue-paying passengers aboard the vehicle by the distance traveled measured in miles. . The company also served a record 2.4 million customers during this period. The third quarter of 2001 results were adversely impacted when the U.S. air traffic control system was shut down for several days in September. Capacity increased nearly 30 percent as AirTran Airways continued to introduce new fuel-efficient fu·el-ef·fi·cient adj. Operable using comparatively little fuel: fuel-efficient cars. fu Boeing (language) BOEING - An early system on the IBM 1130. [Listed in CACM 2(5):16, May 1959]. 717 aircraft and retire older DC-9s. During the quarter the company added five 717s and retired six DC-9s from service. Robert Robert, Henry Martyn 1837-1923. American army engineer and parliamentary authority. He designed the defenses for Washington, D.C., during the Civil War and later wrote Robert's Rules of Order (1876). Noun 1. L. Fornaro, president and chief operating officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. , said: "The third quarter of 2002 was one of our best quarters in terms of operational performance. While the new 717s made a significant contribution, our employees clearly put us over the top. I want to thank every member of the AirTran Airways family for their hard work and dedication to customer service. It's it's 1. Contraction of it is. 2. Contraction of it has. See Usage Note at its. it's it is or it has it's be ~have making a difference in the number of customers who return to AirTran Airways." Operating cost per available seat mile dropped 8.8 percent to 8.21 cents including a 0.9 percent increase in the year-over-year cost of fuel. Excluding the effect of higher fuel costs, AirTran AirTran may mean:
Stan STAN Stanchion STAN Stärke- und Ausrüstungsnachweis (German) Stan Standard Man (human patient simulator) STAN SEMCIP Technical Assistance Network STAN System Trace Audit Number STAN Star Trek Area Network Gadek, senior vice president finance and chief financial officer, said: "While the reduction in unit costs are impressive, they include a 179 percent increase in security and insurance expenses. Excluding the costs for the new security and insurance requirements, our non-fuel unit cost would have declined from 6.83 cents to 6.12 cents or 10.4 percent on a year-over-year basis. Clearly, our efforts to control costs combined with the improved operating efficiencies of the Boeing 717 are having a favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. impact." Highlights of the airline's recent accomplishments include: -- Successfully launched new service to Kansas City, Mo., and announced new service to West Palm Beach, Fla. to begin in December -- Announced November 15, 2002, launch of new regional jet product, AirTran JetConnect, that will serve shorter-haul routes with Canadair Regional Jets -- Delivery of five new Boeing 717s during the third quarter of 2002, with a current total of 62 planes (43 717s and 19 DC-9s) in the fleet -- Received approval and support from the mayor and Atlanta City Council to build a $14.5 million, 56,700 square-foot hangar at Hartsfield International Airport -- Hired Susan Manfredi as vice president of inflight, a new position, to manage AirTran Airways' 1,000 flight attendants -- Offered travel agents and corporate accounts the ability to electronically select, book, change and cancel ticket reservations on airtran.com -- Forged a partnership with The Coca-Cola Company and became the first airline to offer Vanilla Coke(R) and Dasani(R) Water onboard AirTran Holdings, Inc., will conduct a conference call to discuss quarterly earnings today at 10:00 a.m. Eastern. A live broadcast of the conference call will be available via the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at airtran.com. AirTran Airways provides affordable air travel with 388 flights a day to 40(a) cities throughout the eastern United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . The airline's hub is at Hartsfield Hartsfield is a surname, which may be used in reference to:
Unlike other airlines, AirTran Airways never requires a roundtrip round·trip or round-trip also round trip n. A trip from one place to another and back, usually over the same route. purchase or Saturday Saturday: see week; Sabbath. night stay. The airline offers a Business Class any business can afford, all-assigned seating, a generous frequent flier frequent flier n. One who travels often by air, especially on one airline. fre  quent-fli program, and a corporate program called A2B A2B Anti-Two-BlockA2B Administration-to-Broker A2B Administration to Business . For more information and reservations, visit airtran.com (America Online See AOL. Keyword (1) A word used in a text search. (2) A word in a text document that is used in an index to best describe the contents of the document. (3) A reserved word in a programming or command language. 1. : AirTran), call your travel agent or AirTran Airways at 1-800-AIRTRAN (800-247-8726) or 770-994-8258 in Atlanta. For Spanish Spanish, river, c.150 mi (240 km) long, issuing from Spanish Lake, S Ont., Canada, NW of Sudbury, and flowing generally S through Biskotasi and Agnew lakes to Lake Huron opposite Manitoulin island. There are several hydroelectric stations on the river. , call 1-877-581-9842. (a)West Palm Beach service begins Dec. 10, 2002. Editor's note Editor's Note (foaled in 1993 in Kentucky) is an American thoroughbred Stallion racehorse. He was sired by 1992 U.S. Champion 2 YO Colt Forty Niner, who in turn was a son of Champion sire Mr. Prospector and out of the mare, Beware Of The Cat. Trained by D. : Statements regarding the Company's success, business model, and our ability to maintain or improve low costs are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. and are not historical facts. Instead, they are estimates or projections involving numerous risks or uncertainties, including but not limited to, consumer demand and acceptance of services offered by the Company, the Company's ability to maintain current cost levels, fare levels and actions by competitors, regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. matters and general economic conditions. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained from time to time in the Company's SEC filings, including but not limited to the Company's annual report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December December: see month. 31, 2001. The Company disclaims any obligation or duty to update or correct any of its forward-looking statements.
AirTran Holdings, Inc.
Consolidated Statements of Operations
(In thousands, except per share data and statistical summary)
(Unaudited)
Three Months Ended
September 30, Percent
2002 2001 (a) Change
---------- ---------- ----------
Operating Revenues:
Passenger $177,992 $146,850 21.2
Cargo 270 410 (34.1)
Other 4,889 3,417 43.1
---------- ----------
Total operating revenues 183,151 150,677 21.6
Operating Expenses:
Salaries, wages and benefits 51,692 38,378 34.7
Aircraft fuel 40,657 34,757 17.0
Aircraft rent 19,631 9,297 111.2
Distribution 9,731 9,938 (2.1)
Maintenance, materials and repairs 9,446 15,270 (38.1)
Landing fees and other rents 10,847 8,979 20.8
Aircraft insurance and security
services 7,259 2,598 179.4
Marketing and advertising 5,490 4,620 18.8
Depreciation 4,046 6,586 (38.6)
Other operating 17,372 18,255 (4.8)
Impairment loss - 27,990 NM
Special charges - 2,494 NM
Government grant (640) (30,251) (97.9)
---------- ----------
Total operating expenses 175,531 148,911 17.9
---------- ----------
Operating Income 7,620 1,766 331.5
Other (Income) Expense:
Interest income (549) (1,257) (56.3)
Interest expense 6,992 8,745 (20.0)
Convertible debt discount
amortization - 4,291 NM
SFAS 133 adjustment - (89) NM
---------- ----------
Other expense, net 6,443 11,690 (44.9)
---------- ----------
Income (Loss) Before Income Taxes 1,177 (9,924) -
Income Tax Expense - 670 NM
---------- ----------
Net Income (Loss) $1,177 $(10,594) -
========== ==========
Earnings (Loss) per
Common Share
Basic $0.02 $(0.15) -
Diluted $0.02 $(0.15) -
Weighted-average Shares
Outstanding
Basic 70,615 68,690 2.8
Diluted 72,027 68,690 4.9
Third Quarter
Statistical Summary:(b)
Revenue passengers 2,441,115 2,035,162 19.9
Revenue passenger miles (000s) 1,426,776 1,107,901 28.8
Available seat miles (000s) 2,144,572 1,651,105 29.9
EBITDAR $30,657 $17,882 71.4
Operating margin 3.8 % 1.3 % 2.5 pts.
Net margin 0.3 % (4.1)% 4.4 pts.
Block hours 60,785 47,919 26.8
Passenger load factor 66.5 % 67.1 % (0.6)pts.
Break-even load factor 66.3 % 69.6 % (3.3)pts.
Average fare $72.91 $72.16 1.0
Average yield per RPM 12.48 &#x 1; 13.25 &#x 1; (5.8)
Passenger revenue per ASM 8.30 &#x 1; 8.89 &#x 1; (6.6)
Operating cost per ASM 8.21 &#x 1; 9.00 &#x 1; (8.8)
Non-fuel operating cost per ASM 6.32 &#x 1; 6.90 &#x 1; (8.4)
Average cost of aircraft fuel per
gallon 92.60 &#x 1; 91.74 &#x 1; 0.9
Weighted-average number of
aircraft 64 60 6.7
(a)Certain 2001 amounts have been reclassified to conform with 2002
presentation.
(b)Where appropriate, statistical calculations for 2002 exclude a
government grant of $0.6 million. Statistical calculations for
2001 exclude impairment loss, special charges, government grant
and debt discount on convertible debt of $28.0 million, $2.5
million, $30.3 million and $4.3 million, respectively.
AirTran Holdings, Inc.
Consolidated Statements of Operations
(In thousands, except per share data and statistical summary)
(Unaudited)
Nine Months Ended
September 30, Percent
2002 2001 (a) Change
---------- ---------- ----------
Operating Revenues:
Passenger $519,364 $517,232 0.4
Cargo 926 1,704 (45.7)
Other 12,810 11,247 13.9
---------- ----------
Total operating revenues 533,100 530,183 0.6
Operating Expenses:
Salaries, wages and benefits 147,872 119,236 24.0
Aircraft fuel 113,506 109,351 3.8
Aircraft rent 49,751 23,365 112.9
Distribution 32,931 36,231 (9.1)
Maintenance, materials and repairs 35,096 56,540 (37.9)
Landing fees and other rents 31,565 27,156 16.2
Aircraft insurance and security
services 21,805 8,335 161.6
Marketing and advertising 16,602 14,845 11.8
Depreciation 12,661 22,838 (44.6)
Other operating 55,109 51,791 6.4
Impairment loss/lease termination - 46,069 NM
Special charges - 2,494 NM
Government grant (640) (30,251) (97.9)
---------- ----------
Total operating expenses 516,258 488,000 5.8
---------- ----------
Operating Income 16,842 42,183 (60.1)
Other (Income) Expense:
Interest income (1,602) (4,456) (64.0)
Interest expense 21,845 29,679 (26.4)
Convertible debt discount
amortization - 4,291 NM
SFAS 133 adjustment (5,857) (2,701) 116.8
---------- ----------
Other expense, net 14,386 26,813 (46.3)
---------- ----------
Income Before Income Taxes and
Cumulative Effect of Change
in Accounting Principle 2,456 15,370 (84.0)
Income Tax Expense (Benefit) (786) 3,312 -
---------- ----------
Income Before Cumulative
Effect of Change in
Accounting Principle 3,242 12,058 (73.1)
Cumulative Effect of
Change in Accounting
Principle, Net of Tax - (657) NM
---------- ----------
Net Income $3,242 $11,401 (71.6)
========== ==========
Basic Earnings per Common Share
Earnings before cumulative
effect of change in
accounting principle $0.05 $0.18 (72.2)
Cumulative effect of change in
accounting principle - (0.01) NM
---------- ----------
Earnings per common share,
basic $0.05 $0.17 (70.6)
========== ==========
Diluted Earnings per Common Share
Earnings before cumulative
effect of change in
accounting principle $0.04 $0.17 (76.5)
Cumulative effect of change in
accounting principle - (0.01) NM
---------- ----------
Earnings per common share,
diluted $0.04 $0.16 (75.0)
========== ==========
Weighted-average Shares
Outstanding
Basic 70,213 67,226 4.4
Diluted 73,492 74,664 (1.6)
Nine Month Statistical
Summary:(b)
Revenue passengers 7,144,586 6,449,334 10.8
Revenue passenger miles (000s) 4,111,647 3,489,731 17.8
Available seat miles (000s) 6,036,761 4,944,408 22.1
EBITDAR $78,614 $106,698 (26.3)
Operating margin 3.0 % 11.4 % (8.4)pts.
Net margin 0.5 % 6.3 % (5.8)pts.
Block hours 174,024 145,256 19.8
Passenger load factor 68.1 % 70.6 % (2.5)pts.
Break-even load factor 67.9 % 65.4 % 2.5 pts.
Average fare $72.69 $80.20 (9.4)
Average yield per RPM 12.63 &#x 1; 14.82 &#x 1; (14.8)
Passenger revenue per ASM 8.60 &#x 1; 10.46 &#x 1; (17.8)
Operating cost per ASM 8.56 &#x 1; 9.50 &#x 1; (9.9)
Non-fuel operating cost per ASM 6.68 &#x 1; 7.29 &#x 1; (8.4)
Average cost of aircraft fuel per
gallon 89.66 &#x 1; 96.35 &#x 1; (6.9)
Weighted-average number of
aircraft 62 57 8.8
(a)Certain 2001 amounts have been reclassified to conform with 2002
presentation.
(b)Where appropriate, statistical calculations for 2002 exclude a
government grant of $0.6 million. Statistical calculations for
2001 exclude impairment loss/lease termination, special charges,
government grant and debt discount on convertible debt of $46.1
million, $2.5 million, $30.3 million and $4.3 million,
respectively.
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