AirTran 1st Quarter Results

[FL717]

AirTran Holdings Reports Record First Quarter Revenues of $300 Million
Tuesday April 26, 8:00 am ET - Record 3.6 Million Customers Served -



ORLANDO, Fla., April 26 /PRNewswire-FirstCall/ -- AirTran Holdings, Inc., (NYSE: AAI - News), the parent company of AirTran Airways, Inc., today reported its results for the first quarter of 2005:

-- Operating revenues increased 24.2% to $300 million -- Revenue passengers increased 19.5% to 3.6 million -- Load factor set a new first quarter record of 70.5%

For the first quarter of 2005, AirTran Airways reported a net loss of $8.0 million or $0.09 per share. This compares to net income of $4.1 million or $0.05 per diluted share in the first quarter of 2004.

"The first quarter challenged us on many fronts as we grew revenues and capacity while contending with escalating fuel prices," said Joe Leonard, chairman and chief executive officer. "Nevertheless, we were able to increase our load factor compared to the prior year. I am proud of the outstanding efforts put forth by our Crew Members to serve a record number of passengers during the first quarter."

Robert L. Fornaro, president and chief operating officer, remarked, "AirTran Airways continues to expand its network with new airplanes, low fares and friendly Crew Members. We have announced service to Indianapolis, Charlotte and Richmond offering new, quality low-fare service in historically high-priced markets. In addition, we continue to improve our product with the introduction of XM Satellite Radio now installed on over 20 percent of our aircraft."

AirTran's cost metrics remained consistent year-over-year. Non-fuel operating cost per available seat mile (CASM) increased slightly to 6.44 cents in the first quarter of 2005 compared to 6.42 cents in the year earlier period. On a fuel price neutral basis, CASM declined 0.4 percent to 8.23 cents for the first quarter of 2005. CASM, including fuel, increased 7.7 percent for the first quarter of 2005 to 8.90 cents.

Commenting on the Company's cost performance, Stan Gadek, senior vice president of finance and chief financial officer said, "As our 737 fleet continues to grow, we expect to see further reduction in unit costs. The 737's fuel efficiency and low cost of operation will contribute to our low-cost structure."

Highlights of AirTran's accomplishments since the first of the year include:

* Initiated new service to Indianapolis * Announced expansion to Charlotte and Richmond * Added two B717 and four B737 aircraft to our fleet * Named Best Low-Fare airline by Entrepreneur Magazine for 2005 * Announced enhanced service to Atlanta, Dallas/Fort Worth, Las Vegas and Los Angeles * Unveiled 20 select aircraft with special Elton John livery celebrating the airline's new XM Satellite Radio serviceAirTran Holdings, Inc., will conduct a conference call to discuss quarterly results today at 10:00 a.m. Eastern. A live broadcast of the conference call will be available via the internet at http://www.airtran.com.

 

[Vladimir Lenin]

revenues increase and so do losses, time to tighten the belt, boyz

 

[Boeingman]

Can someone answer this question without me being flamed or starting a war?

Is it true that management has approached you guys for a 12% cut in pay and benefits?

 

[XGmaninGA]

They have asked for 12% in "improvements". Specifics (pay, productivity, etc.) would be negotiated.

 

[-9Capt]

Can someone answer this question without me being flamed or starting a war?

Is it true that management has approached you guys for a 12% cut in pay and benefits?

We are currently in section 6 contract negotiations. 12% in concessions was the company's opening proposal.

Specifically, they want relief from the 12hr duty day, reserve pay, and line value index (scheduling formula), each of which makes our contract somewhat unique. They never mentioned an hourly pay cut.

The results of the unions telephone/on-line poll indicate the pilot group has no interest in discussing concessions. Particularly after this came out...


AirTran boss got $5.7 million pay package in '04


By RUSSELL GRANTHAM
The Atlanta Journal-Constitution
Published on: 04/11/05
Running one of the nation's few profitable airlines is paying off for top executives at AirTran Airways.

The discount carrier's top five executives collected $8.3 million in cash and stock awards last year, according to the company's proxy statement.

Joe Leonard, chairman and chief executive officer, was paid $1,005,769 in salary and bonus, and he got a restricted stock award valued at $4,668,000, according to the filing with the Securities and Exchange Commission Monday.

Leonard's salary and bonus was $1 million the previous year, but his pay package didn't include a grant of restricted stock, a form of incentive pay involving shares awarded at specific future dates. The executive typically has to stay with the company to get the shares.

AirTran logged a $12 million profit in 2004, though that was down from $100 million a year earlier. The carrier's stock declined 11 percent in 2004.

AirTran's other top four executives also got big raises last year, mostly because of stock awards.

All received restricted stock, marking a shift from the practice of granting stock options. Last year, the executives got about a third as many stock options as in previous years.

Restricted stock is considered less risky than stock options, which can be worthless if shares fall below certain "exercise" price targets.

AirTran President Bob Fornaro's cash and stock awards totaled $1.25 million, including $385,577 salary, $450,000 bonus and $416,960 restricted stock. He got $711,058 cash the previous year.

Senior Vice President Stephen Kolski's cash and stock awards totaled $459,197, including $218,462 salary, $143,000 bonus and $97,725 restricted stock. He got $328,385 cash the previous year.

Chief financial officer Stanley Gadek's cash and stock awards totaled $482,847, including $210,577 salary, $155,000 bonus and $117,270 restricted stock. He got $284,135 cash the previous year.

Senior vice president Richard Magurno's cash and stock awards totaled $436,648, including $203,923 salary, $135,000 bonus and $97,725 restricted stock. He got $280,606 cash the previous year.

Orlando-based AirTran is Delta Air Lines' largest rival at Atlanta's Hartsfield-Jackson airport.

AirTran, Southwest, JetBlue and other discount airlines have been mostly profitable since 2001, owing to lower cost structures that enable them to make money at lower fares. However, those profits have been under pressure lately because of high fuel prices.

 

[737 Pylt]

mgmt sucks!

The results of the unions telephone/on-line poll indicate the pilot group has no interest in discussing concessions. Particularly after this came out...

Bravo for you guys! You have to love the mgmt. style of thinking! Put it all on the backs of labor!
When I see mgmt taking bonuses and asking for concessions one really has to wonder what these people (if you can call them that) are thinking??
737

 

[lowecur]

stagnant?

RASM modestly decreased for AAI, as LUV, and JBLU had increases. AWA was the real winner on RASM this quarter as it increased 8%. Competition is not as strong on the West Coast for AWA, but their RASM mgt was still excellent as they turned it around from the previous quarter.

AAI should be helped by a reduced CASM as the 737s are deployed. The real question is whether they are seeing comparative load factors with the competition on those longer flts? AAI needs to see capacity shrink on the East Coast. The next month will be telling as UAIR's future will unfold. There will definitely be a shrinkage of capacity on the East Coast, it's just a matter of who steps in to cherry pick the availability. If UAIR gets the support they need for consolidation, then that will probably seal any future for Flyi.

 

[Boeingman]

We are currently in section 6 contract negotiations. 12% in concessions was the company's opening proposal.

Specifically, they want relief from the 12hr duty day, reserve pay, and line value index (scheduling formula), each of which makes our contract somewhat unique. They never mentioned an hourly pay cut.

The results of the unions telephone/on-line poll indicate the pilot group has no interest in discussing concessions. Particularly after this came out...

Thanks for the answer. And kudos for you all to stand your ground. Sounds like you have better terms then our pos TA just negotiated.

That 12 hour duty should be an FAR.

 

[Boeingman]

to wonder what these people (if you can call them that) are thinking??

That they don't give a rat's arse about the company, the employees or their future.

 

[Boeingman]

They have asked for 12% in "improvements". Specifics (pay, productivity, etc.) would be negotiated.

I love how management reduces financial hits to the employess. "Improvement".......another words, they want you to bend over 12% further.

Thanks for the answer.