Alaska Air Group reports record second quarter results.SEATTLE--(BUSINESS WIRE)--July 18, 1996--Alaska Air Group Inc. (NYSE NYSE See: New York Stock Exchange ) today reported record second quarter net income of $18 million, or $1.24 per share (88 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. fully 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. ), as compared to net income of $7 million or 52 cents per share (48 cents per share fully diluted) in 1995. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. was $39.7 million compared to $24.5 million in 1995. Operating revenues operating revenue Revenue from any regular source. Revenue from sales is adjusted for discounts and returns when calculating operating revenue. Compare other revenue. for the second quarter rose to $416.7 million, an increase of 15 percent, while operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. increased to $377 million, up 11.6 percent. "We're we're Contraction of we are. we're we are obviously pleased with all aspects of our record second quarter performance. This marks our fourth consecutive quarter of improved year-over-year results, which is gratifying grat·i·fy tr.v. grat·i·fied, grat·i·fy·ing, grat·i·fies 1. To please or satisfy: His achievement gratified his father. See Synonyms at please. 2. ," said John Kelly John Kelly or Jack Kelly is the name of: People
"The strengthening of our fare structure was reflected in improved yields that, combined with strong traffic growth, resulted in a significant improvement in revenue. At the same time, with the exception of fuel, costs were essentially flat compared to last year. Combined, these factors resulted in net income being 66 percent higher than our previous second quarter record." Alaska Alaska (əlă`skə), largest in area of the United States but third smallest (exceeding only Vermont and Wyoming) in population, occupying the northwest extremity of the North American continent, separated from the coterminous United States Airlines' second quarter passenger traffic increased 16.8 percent on a capacity increase of 8.9 percent. Passenger load factor climbed 4.4 points to 65.7 percent, compared to 61.3 percent in 1995. The airline's yield per revenue passenger mile 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. (RPM (1) (Revolutions Per Minute) With electric and electronics devices, RPM measures the rotational speed of the motor's spindle. Floppy disks rotate at 300 RPM, while hard disks rotate from 3,000 to 15,000 RPM. ) increased 2 percent. Operating cost per available seat mile (ASM (1) (Association for Systems Management) An international membership organization based in Cleveland, Ohio. Founded in 1947 and disbanded in 1996, it sponsored conferences in all phases of administrative systems and management. ) increased 3.7 percent, primarily due to higher fuel prices and the federal fuel tax. Alaska's pretax income pretax income Reported income before the deduction of income taxes. Pretax income is sometimes considered a better measure of a firm's performance than aftertax income because taxes in one period may be influenced by activities in earlier periods. increased to $33.1 million compared to $15.1 million a year earlier. Horizon Air's second quarter passenger traffic increased less than one percent on a capacity decrease of 1.3 percent. Horizon's passenger load factor increased 1.2 points to 58.5 percent. Horizon's yield per RPM increased 8.8 percent, while its operating cost per ASM also increased 8.8 percent. Horizon's pretax income increased to $2.6 million from $1.1 million a year earlier. For the six months ended June June: see month. 30, 1996, Alaska Air Group Inc. reported a net profit of $10.8 million, or 76 cents per share (66 cents per share fully diluted), versus a net loss of $9.3 million, or 70 cents per share, for the first six months of 1995. Operating revenues increased 16.9 percent to $768.1 million and operating expenses increased 12.6 percent to $732.9 million. The operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. for the first half of 1996 was $35.2 million compared to $6.2 million last year. Alaska Air Group is the parent company of Alaska Airlines Alaska Airlines, (NYSE: ALK) is an airline based in Seattle, Washington, United States. It operates hubs at Seattle-Tacoma International Airport, Ted Stevens Anchorage International Airport, Los Angeles International Airport, and Portland International Airport. Inc. and Horizon Air Industries Inc. -0-
ALASKA AIR GROUP INC.
CONSOLIDATED STATEMENT OF INCOME
(In millions, except per share amounts)
Quarter Six Months
Ended June 30 Ended June 30
1996 1995 1996 1995
Operating Revenues:
Passenger $374.2 $320.8 $686.8 $580.2
Freight and mail 24.9 24.4 46.3 45.5
Other 17.6 17.0 35.0 31.1
Total operating revenues 416.7 362.2 768.1 656.8
Operating Expenses: Wages and benefits 117.5 108.5 231.8 208.3 Aircraft fuel 57.3 43.9 107.8 83.1 Aircraft maintenance 24.6 19.7 48.1 40.3 Aircraft rent 45.2 43.0 89.3 84.7 Commissions 26.9 25.0 49.9 45.3 Depreciation and amortization 16.8 17.0 34.0 33.9 Landing fees and other rentals 15.7 15.1 30.7 29.0 Other 73.0 65.5 141.3 126.0 Total operating expenses 377.0 337.7 732.9 650.6 Operating Income 39.7 24.5 35.2 6.2
Interest income 2.9 2.0 5.5 3.3
Interest expense (9.8) (13.1) (20.9) (26.4)
Loss on sale of assets (0.1) (0.7) (0.8) (0.7)
Other income -net 0.2 0.2 0.4 0.6
(6.8) (11.6) (15.8) (23.2)
Income (Loss) before income tax 32.9 12.9 19.4 (17.0) Income tax expense (credit) 14.9 5.9 8.6 (7.7) Net Income (Loss) $ 18.0 $ 7.0 $ 10.8 $ (9.3) Primary Earnings (Loss) Per Share $1.24 $0.52 $0.76 $(0.70) Fully Diluted Earnings Per Share $0.88 $0.48 0.66 note a Shares used for computation: Primary 14.5 13.4 14.2 13.4 Fully diluted 22.7 19.3 22.4 note a (a) Anti-dilutive
ALASKA AIR GROUP INC.
CONSOLIDATED BALANCE SHEET
(In millions)
June 30 December 31
1996 1995
Cash and marketable securities $ 105.1 $ 135.1 Total current assets 323.7 338.4 Property and equipment-net 849.9 814.0 Other assets 151.2 161.0 Total assets $1,324.8 $1,313.4 Current liabilities $ 453.5 $ 444.8 Long-term debt and capital lease obligations 483.7 522.4 Other liabilities and credits 142.9 133.7 Shareholders' equity 244.7 212.5 Total liabilities and equity $1,324.8 $1,313.4
ALASKA AIRLINES FINANCIAL AND STATISTICAL DATA
Quarter Ended June 30 Six Months Ended June 30
1996 1995 % Chg. 1996 1995 % Chg.
Financial Data (in millions): Operating Revenues: Passenger $302.7 $254.1 19.1 $547.8 $454.1 20.6 Freight and mail 22.1 21.7 1.8 40.8 40.3 1.2 Other - net 16.8 17.1 (1.8) 33.4 31.2 7.1 Total Operating Revenues 341.6 292.9 16.6 622.0 525.6 18.3 Operating Expenses: Wages and benefits 94.8 86.9 9.1 186.3 166.0 12.2 Aircraft fuel 49.5 37.2 33.1 92.3 70.3 31.3 Aircraft maintenance 14.3 11.4 25.4 27.9 23.3 19.7 Aircraft rent 36.6 34.4 6.4 72.1 67.6 6.7 Commissions 23.7 20.0 18.5 43.3 35.8 20.9 Depreciation and amortization 13.8 14.6 (5.5) 28.0 29.3 (4.4) Landing fees and other rentals 12.5 11.8 5.9 24.4 22.7 7.5 Other 59.0 53.1 11.1 113.5 101.3 12.0 Total Operating Expenses 304.2 269.4 12.9 587.8 516.3 13.8 Operating Income 37.4 23.5 59.1 34.2 9.3 267.7
Interest income 3.0 2.1 5.7 3.6
Interest expense (7.6) (10.2) (16.5) (20.7)
Other - net 0.3 (0.3) 0.4 0.1
(4.3) (8.4) (10.4) (17.0)
Income (Loss) Before Income Tax $33.1 $15.1 $23.8 $(7.7) Operating Statistics: Revenue passengers (000) 3,005 2,499 20.3 5,581 4,595 21.5 RPM's (000,000) 2,504 2,143 16.8 4,630 3,937 17.6 ASM's (000,000) 3,809 3,498 8.9 7,309 6,680 9.4 Passenger load factor 65.7% 61.3% 4.4 pts 63.3% 58.9% 4.4 pts Breakeven load factor 58.2% 57.4% 0.8 pts 60.9% 60.5% 0.4 pts Yield per passenger mile (in cents) 12.09 11.85 2.0 11.83 11.53 2.6 Operating revenue per ASM (in cents) 8.97 8.37 7.2 8.51 7.87 8.1 Operating expenses per ASM (in cents) 7.99 7.70 3.7 8.04 7.73 4.0 Fuel cost per gallon (in cents) 73.7 60.9 21.0 71.2 60.5 17.7 Average number of employees 7,511 6,907 8.7 7,404 6,794 9.0 Aircraft utilization (block hours) 11.5 10.8 6.3 11.2 10.6 5.7 Operating fleet at period-end 76 74 2.7 76 74 2.7
HORIZON AIR FINANCIAL AND STATISTICAL DATA
Quarter Ended June 30 Six Months Ended June 30
1996 1995 % Chg. 1996 1995 % Chg.
Financial Data (in millions): Operating Revenues: Passenger $73.0 $66.7 9.4 $142.1 $126.1 12.7 Freight and mail 2.8 2.7 3.7 5.5 5.2 5.8 Other - net 0.9 0.8 12.5 1.5 1.7 (11.8) Total Operating Revenues 76.7 70.2 9.3 149.1 133.0 12.1 Operating Expenses: Wages and benefits 22.7 21.6 5.1 45.5 42.3 7.6 Aircraft fuel 7.9 6.7 17.9 15.5 12.7 22.0 Aircraft maintenance 10.3 8.3 24.1 20.2 17.0 18.8 Aircraft rent 8.6 8.6 - 17.2 17.1 0.6 Commissions 4.8 4.9 (2.0) 9.6 9.5 1.1 Depreciation and amortization 3.0 2.3 30.4 5.8 4.5 28.9 Landing fees and other rentals 3.2 3.3 (3.0) 6.3 6.3 - Other 13.5 13.1 3.1 27.1 26.0 4.2 Total Operating Expenses 74.0 68.8 7.6 147.2 135.4 8.7
Operating
Income (Loss) 2.7 1.4 92.9 1.9 (2.4) NM
Interest income 0.1
Interest expense (0.2) (0.2) (0.3) (0.4)
Other - net 0.1 (0.1) (0.7) 0.0
(0.1) (0.3) (0.9) (0.4)
Income (Loss) Before Income Tax $2.6 $1.1 $1.0 $(2.8) Operating Statistics: Revenue passengers (000) 920 948 (2.9) 1,828 1,812 0.9 RPM's (000,000) 208 207 0.6 417 393 6.1 ASM's (000,000) 356 361 (1.3) 710 684 3.8 Passenger load factor 58.5% 57.3% 1.2 pts 58.8% 57.5% 1.3 pts Breakeven load factor 56.2% 56.2% 58.1% 58.9% (0.8) pts Yield per passenger mile (in cents) 35.09 32.25 8.8 34.06 32.07 6.2 Operating revenue per ASM (in cents) 21.54 19.47 10.6 21.01 19.45 8.0 Operating expenses per ASM (in cents) 20.77 19.09 8.8 20.75 19.80 4.8 Fuel cost per gallon (in cents) 77.5 63.8 21.6 75.5 64.1 17.8 Average number of employees 2,832 2,900 (2.3) 2,836 2,853 (0.6) Aircraft utilization (block hours) 7.7 8.1 (4.5) 7.7 8.1 (5.1) Operating fleet at period-end 59 68 (13.2) 59 68 (13.2) CONTACT: Alaska Air Harry Lehr, 206/431-7032 Lou Cancelmi, 206/433-3170 |
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