Video: SkyWest Airlines.
Highlights are as follows:
Excluding special items, SkyWest’s pre-tax income was $33.5 million for the December 2014 quarter, an increase of $18.4 million over the December 2013 quarter. SkyWest’s net loss, including special items, was $(27.9) million, or $(0.54) per diluted share, for the December 2014 quarter, compared to net income of $8.6 million, or $0.17 per diluted share, for the December 2013 quarter.
The December 2014 quarter includes special item expenses of $70.0 million pre-tax ($43.6 million after-tax) due to the accelerated retirement of SkyWest’s EMB-120 turboprop aircraft and a code-share agreement modification that shortened the contract term for ExpressJet’s operation of the ERJ 145 aircraft type.
SkyWest’s pre-tax income for the December 2014 quarter, excluding special items, increased 122% from the December 2013 quarter, despite a 6.6% reduction in departures and a 4.4% reduction in completed block hours, from the December 2013 quarter. Excluding the special items, the increase in pre-tax income from the December 2013 quarter was primarily due to higher unit revenue from new and renewed flying arrangements at improved rates as described in more detail below.
For the 2014 year, SkyWest’s pre-tax income, excluding special items, was $58.4 million, compared to $98.5 million for the 2013 year. SkyWest’s net loss, including special items, was $(24.2) million, or $(0.47) per diluted share, for the 2014 year, compared to net income of $59.0 million, or $1.12 per diluted share, for the 2013 year.
Significant operational and commercial items related to the December 2014 quarter include:
SkyWest Airlines took delivery of six E175 aircraft during the quarter under its flying contract with United, which resulted in a total of 20 E175 deliveries for calendar 2014.
SkyWest is scheduled to take delivery of the remaining 20 E175s under its United agreement during the first three quarters of 2015.
SkyWest Airlines reached an agreement with Alaska to operate seven new E175 aircraft with deliveries scheduled between the third quarter of 2015 and the first quarter of 2016.
SkyWest Airlines reached an agreement with Delta to operate 12 additional used CRJ200 aircraft that SkyWest Airlines intends to lease from Delta. The aircraft deliveries started in December 2014 and are scheduled to continue through the second quarter of 2015.
SkyWest Airlines started the removal of 43 EMB-120 turboprop aircraft from service and is expected to be an all-jet operator by the conclusion of the second quarter of 2015. As of December 31, 2014, SkyWest owned 18 EMB-120s and leased 25 EMB-120s.
For the second consecutive quarter, ExpressJet’s operational reliability improved year-over-year to a 99.6% adjusted completion rate for the December 2014 quarter compared to 99.1% for the December 2013 quarter.
ExpressJet reached an agreement with American to operate 15 used ERJ 145 aircraft that ExpressJet intends to lease from American. The American ERJ 145 operation is scheduled to begin during the first quarter of 2015.
Commenting on the results, Jerry C. Atkin, SkyWest’s Chairman and CEO said, “SkyWest made significant progress in executing our long-term strategy in the fourth quarter, including reducing the total number of unprofitable aircraft and flying over time. We expect these changes to continue through 2017, as we continue to work with our major airline partners to meet their needs with larger RJ opportunities during that same period. We expect that reducing our total fleet count while improving the overall fleet composition will put us on a path of continued financial and operational improvement.”
Copyright Photo: Tony Storck/AirlinersGallery.com. ExpressJet removed 10 ERJ 145s from its United flying contract during the fourth quarter of 2014 and is returning the aircraft to United. ExpressJet removed a total of 26 ERJ 145s from its United flying contract during the 2014 year. Additionally, 59 ERJ 145s and nine ERJ 135s are scheduled to be removed from service during 2015 and to be returned to United. As of December 31, 2014, ExpressJet had 216 ERJ 145s and nine ERJ 135s operating under the United ERJ contract. ExpressJet Airlines’ Embraer ERJ 145LR (EMB-145LR) N14959 (msn 145091) arrives at Baltimore/Washington.
Alaska Airlines (Seattle/Tacoma) will also inaugurate Embraer 175 operations on July 1 on three additional routes besides those previously reported. The three new routes on July 1 will be Portland, Oregon-Salt Lake City, Seattle/Tacoma-Ontario and Seattle/Tacoma-Salt Lake City.
As previously reported, the new Embraer ERJ 175 jets (a new type in Alaska colors), Alaska will begin offering daily nonstop service starting on July 1, 2015 between Seattle/Tacoma and Milwaukee, Wisconsin; Seattle/Tacoma and Oklahoma City, Oklahoma; and Portland, Oregon and St. Louis.
The 76-seat E175 jet will feature 12 seats in first class and 64 in coach, and boasts cabin dimensions on par with a Boeing 737. Onboard amenities include Wi-Fi Internet access, streaming inflight entertainment and 110 volt power in every first class seat. Food and beverage will include hot meals and picnic packs for purchase, in addition to Northwest microbrews and wine.
SkyWest Airlines (Alaska SkyWest) (St. George, UT) has purchased seven Embraer ERJ 175 aircraft to fly on behalf of Alaska under a capacity purchase agreement (CPA). The first three aircraft will arrive in the summer of 2015, and the remaining four will be delivered in the first quarter of 2016.
Alaska SkyWest aircraft slide show:
The airline will outfit more than 200 Embraer ERJ 175, ERJ 170 and Bombardier CRJ700 regional jets with Gogo’s ATG-4 advanced air-to-ground Wi-Fi product. By mid-2015, United expects to complete installation on nearly all these aircraft.
Additionally, the company will begin providing Personal Device Entertainment on regional jets this year, offering customers hundreds of complimentary movies and television shows to view on their Wi-Fi-enabled iOS and Android devices using United’s mobile app, as well as on laptop computers.
United Wi-Fi and Personal Device Entertainment
United’s regional jet Wi-Fi installations begin as the airline continues to outfit its mainline fleet with Wi-Fi, which the carrier currently offers on nearly three-quarters of its domestic mainline fleet. United also operates more international aircraft with Wi-Fi than any other U.S. airline.
The company has installed Personal Device Entertainment on nearly 200 mainline aircraft, including its entire Boeing 747-400, Airbus A319 and A320 fleets and its nine Boeing 777 aircraft that fly primarily between the continental United States and Hawaii.
Regional Service Upgrades
In addition to Wi-Fi and Personal Device Entertainment, United is further investing in its customers’ regional-jet experience, including:
Adding 120 Embraer ERJ 175 aircraft to the regional fleet, each offering wider seats and aisles than other regional aircraft, large overhead bins and a power outlet at each United First seat; and
Upgrading premium-cabin meal service on United Express this spring by replacing snack boxes with freshly prepared food on flights that are more than 2 hours and 20 minutes, or 800 miles.
Copyright Photo: Ken Petersen/AirlinersGallery.com. SkyWest Airlines’ Embraer ERJ 170-200LR (ERJ 175) N105SY (msn 17000395) waits for its next assignment at the Chicago (O’Hare) hub.
United Express-SkyWest Airlines aircraft slide show:
SkyWest Airlines (United Express) (St. George, Utah) has announced it will drop its twice-daily service to St. Cloud Regional Airport in Minnesota in April 2015 due to disappointing traffic. The airline operates United Express service to United Airlines’ (Chicago) O’Hare International Airport (ORD) hub.
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Copyright Photo: Michael B. Ing/AirlinersGallery.com. SkyWest’s Bombardier CRJ200 (CL-600-2B19) N939SW (msn 7742) arrives in Los Angeles.
United Express-SkyWest aircraft slide show:
SkyWest Airlines (St. George, Utah) will United Express Embraer EMB-120 Brasilia service between the Los Angeles hub and Carlsbad/Oceanside, California on April 6, 2015. SkyWest is phasing out all of its Brasilias.
Copyright Photo: Michael B. Ing/AirlinersGallery.com. Embraer EMB-120ER Brasilia N568SW (msn 120343) arrives at Los Angeles International Airport.
United Express-SkyWest aircraft slide show:
SkyWest Airlines (St. George, Utah) has informed its maintenance employees that it is taking over the Endeavor Air (Delta Connection) (Minneapolis/St. Paul) maintenance base at Fort Wayne, Indiana on February 1, 2015. The company expects to handle up to four overnight Bombardier CRJ200s for the Delta Connection system (see route map below).
Copyright Photo: Michael B. Ing/AirlinersGallery.com. SkyWest’s Bombardier CRJ200 (CL-600-2B19) N466SW (msn 7856) departs from Los Angeles in the house colors.
Delta Connection-SkyWest aircraft slide show:
Delta Connection-SkyWest current route map (click to expand):