monkeybrains01
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Frontier Airlines Reports Fiscal Third Quarter 2007 Results
DENVER, Jan. 25 /PRNewswire-FirstCall/ -- Frontier Airlines Holdings, Inc. (NASDAQ: FRNT) today reported a net loss of $14.4 million, or $0.39 per diluted share, for the airline's third fiscal quarter ended December 31, 2006 compared to a net loss of $10.3 million, or $0.28 per diluted share, for the same period last year. Included in the net loss for the quarter ended December 31, 2006 was non-cash mark to market derivative gains, which decreased fuel expense by $1.4 million. This item, net of income taxes, decreased Frontier's net loss by $0.02 per diluted share for the quarter ended December 31, 2006. Included in the net loss for the quarter ended December 31, 2005 were the following items before the effect of income taxes: unrealized losses on fuel hedges of $1.5 million and gains of $0.3 million related primarily to the sale of Boeing parts held for sale. These items, net of income taxes, increased Frontier's net loss by $0.03 per diluted share.
Two major snow storms in Denver, Colorado in December 2006 had a significant negative impact on Frontier's operating results for the quarter ended December 31, 2006. Frontier cancelled 875 flights affecting 105,000 passengers as a result of these storms. One storm completely shut down Frontier's primary operating hub, Denver International Airport (DIA), for almost 48 hours. The Company estimates that the snow storms reduced revenue by approximately $12.2 million from its mainline operation and by another $1.0 million from its regional jet service, operated by Horizon Air. In addition, the storms increased many variable costs including $1.2 million in additional glycol expenses over the prior year and $0.9 million in additional wages related to station personnel and flight crews, offset by a reduction of fuel, landing fees, maintenance expenses and catering expenses of $3.3 million. The net after-tax impact from the snowstorms on the December 2006 quarterly results was estimated to be $0.27 per diluted share.
Chief Executive Officer's Comments
Frontier President and CEO Jeff Potter said, "The irony of this quarter's disappointing loss is that it belies the fact that during a two-week window our employees engaged in some of the hardest work and put forth some of the greatest efforts on behalf of this Company we have ever seen. I am referring of course to the series of winter storms that laid siege to our hub over some of the busiest travel days of the year from just before Christmas through the heaviest travel days of the New Year holiday. Our employees, many of whom spent several consecutive days at the airport and at reservations, worked tirelessly to accommodate over 100,000 passengers that were displaced by DIA's closure. The end result of the storms was a pre-tax financial impact estimated to be approximately $11.9 million. However, if there is a silver lining, it is that our employees did what they do best when staring adversity in the face -- and this was probably the greatest challenge in our history as an airline excluding the events of September 11, 2001 -- they faced the challenges head on and became, in my eyes, the heroes of an otherwise dismal story.
"Looking beyond the immediate impact of the storms and a three percent year-over-year decrease in average fare attributable to the intensely competitive Denver market, we see a brighter picture on the horizon. We made several announcements during and since the quarter end that we believe will have a substantially positive impact on our future ability to generate incremental revenue through our hub. Specifically, we believe that our regional expansion with Republic Airlines, which will operate 17 Embraer 170 aircraft for us, and our new subsidiary, Lynx Aviation, which will operate ten 74-seat Q400 aircraft by the end of 2007, will further leverage the revenue generating capacity of our Denver hub complex and diversify our exposure to Denver origin and destination competition. In addition, our new marketing and referral partnership with AirTran is proving to be as successful as we had initially anticipated and we believe will provide additional revenue support during slower months."
DENVER, Jan. 25 /PRNewswire-FirstCall/ -- Frontier Airlines Holdings, Inc. (NASDAQ: FRNT) today reported a net loss of $14.4 million, or $0.39 per diluted share, for the airline's third fiscal quarter ended December 31, 2006 compared to a net loss of $10.3 million, or $0.28 per diluted share, for the same period last year. Included in the net loss for the quarter ended December 31, 2006 was non-cash mark to market derivative gains, which decreased fuel expense by $1.4 million. This item, net of income taxes, decreased Frontier's net loss by $0.02 per diluted share for the quarter ended December 31, 2006. Included in the net loss for the quarter ended December 31, 2005 were the following items before the effect of income taxes: unrealized losses on fuel hedges of $1.5 million and gains of $0.3 million related primarily to the sale of Boeing parts held for sale. These items, net of income taxes, increased Frontier's net loss by $0.03 per diluted share.
Two major snow storms in Denver, Colorado in December 2006 had a significant negative impact on Frontier's operating results for the quarter ended December 31, 2006. Frontier cancelled 875 flights affecting 105,000 passengers as a result of these storms. One storm completely shut down Frontier's primary operating hub, Denver International Airport (DIA), for almost 48 hours. The Company estimates that the snow storms reduced revenue by approximately $12.2 million from its mainline operation and by another $1.0 million from its regional jet service, operated by Horizon Air. In addition, the storms increased many variable costs including $1.2 million in additional glycol expenses over the prior year and $0.9 million in additional wages related to station personnel and flight crews, offset by a reduction of fuel, landing fees, maintenance expenses and catering expenses of $3.3 million. The net after-tax impact from the snowstorms on the December 2006 quarterly results was estimated to be $0.27 per diluted share.
Chief Executive Officer's Comments
Frontier President and CEO Jeff Potter said, "The irony of this quarter's disappointing loss is that it belies the fact that during a two-week window our employees engaged in some of the hardest work and put forth some of the greatest efforts on behalf of this Company we have ever seen. I am referring of course to the series of winter storms that laid siege to our hub over some of the busiest travel days of the year from just before Christmas through the heaviest travel days of the New Year holiday. Our employees, many of whom spent several consecutive days at the airport and at reservations, worked tirelessly to accommodate over 100,000 passengers that were displaced by DIA's closure. The end result of the storms was a pre-tax financial impact estimated to be approximately $11.9 million. However, if there is a silver lining, it is that our employees did what they do best when staring adversity in the face -- and this was probably the greatest challenge in our history as an airline excluding the events of September 11, 2001 -- they faced the challenges head on and became, in my eyes, the heroes of an otherwise dismal story.
"Looking beyond the immediate impact of the storms and a three percent year-over-year decrease in average fare attributable to the intensely competitive Denver market, we see a brighter picture on the horizon. We made several announcements during and since the quarter end that we believe will have a substantially positive impact on our future ability to generate incremental revenue through our hub. Specifically, we believe that our regional expansion with Republic Airlines, which will operate 17 Embraer 170 aircraft for us, and our new subsidiary, Lynx Aviation, which will operate ten 74-seat Q400 aircraft by the end of 2007, will further leverage the revenue generating capacity of our Denver hub complex and diversify our exposure to Denver origin and destination competition. In addition, our new marketing and referral partnership with AirTran is proving to be as successful as we had initially anticipated and we believe will provide additional revenue support during slower months."
