jettypeguy
Wishing you and yours only the best. You can't just talk about the good news, you need to talk about all the news. You can only keep crazy Uncle Arthur in the cellar for so long, and you can only sweep so much dirt under the carpet. Everything needs to be discussed on these boards - good or bad. Here's some more info(facts)
ATA
For the quarter, the airline reported a loss of $64.3 million, or $5.47 a share. This compared to a loss of $10.9 million, or 97 cents a share for the same period in 2003.
The numbers here did not look good no matter how you looked at them.
While operating revenue at the airline was up 3.7%, operating expenses were up a whopping 10.1%. While the airline reported a small operating profit for the quarter last year of $1.5 million, this year the airline posted a $22.4 million operating loss.
The airline saw its load factor drop back 2.8 points to 67%, down from 69.8%, as scheduled available seat miles were up 19.5%, while revenue passenger miles only increased 14.7%.
Yield for the airline's scheduled service was down 1.3% to 9 cents/mile, while scheduled service RASM was down 5.2% to 6.03 cents/mile. That's an ouch.
But here's the bigger ouch. CASM at the airline was up 4.3% to 7.34 cents/mile.
Speaking of costs, the airline did post a $27 million charge that was related to the restructuring of its bond debt that occurred in January. This agreement staved off a bankruptcy filing at that time. The debt restructuring gives ATA four more years to pay off more than $300 million in debt that was due this year, freeing up $142.4 million in 2004. At the same time, the airline restructured aircraft leases that cut ATA's cash outlay this year by another $99.4 million.
The airline was also hurt by higher fuel costs as fuel and oil costs rose nearly 10% at the airline, year over year, to $82.3 million.
The airline also said in its call last week that it has now postponed pay increases this year and next year for all pilots and cabin crew at the airline.
ATA said on April 29 it was exploring buying 100-seat aircraft such as the Boeing 717 or Embraer 190 to fill a niche in a fleet heavy on bigger jets and smaller turboprops. ATA said it was discussing the changes with unions representing its pilots and flight attendants, and the company's news release included statements of support for the move from representatives of both unions.
I think ATA has more than one problem. One, it has airplanes that are too big -- all those Boeing 757s that it ordered. Yes, it needs some smaller aircraft.
Two, the airline continues, I think, to suffer from an image problem. Folks who I have talked to who have flown the airline recently have been pretty happy with the experience. The airline has roomy seat pitch, and from what I understand the on-board experience is pretty good -- and value priced.
But unfortunately, I don't think a lot of passengers out there know this. The airline does suffer, I believe, from that "cattle car" image that the airline did indeed live up to in the past. And let's face it, the airline is bereft of any compelling advertising or marketing that would inform the world otherwise.
The ATSB loan and the debt restructuring gave the airline just a bit of breathing room. But goodness, with these types of losses, that breathing room is going to go away here in no short order.
