SkyWest produces net income of $48 million in the third quarter

SkyWest issued this financial report for the third quarter:

Third Quarter 2022 Highlights

  •   Pre-tax income of $57 million, net income of $48 million and $0.96 per diluted share
  •   Took delivery of two E175 aircraft for American Airlines and seven E175 aircraft for Delta Air Lines under previously announced agreements
  •   SkyWest’s E175 fleet generated over 50% of SkyWest’s block hour production during the quarter as the Company continues to execute on its fleet strategy

    SkyWest, Inc. reported financial and operating results for Q3 2022, including net income of $48 million, or $0.96 per diluted share, compared to net income of $10 million, or $0.19 per diluted share, for Q3 2021 and adjusted net income of $74 million1, or $1.45 per diluted share, for Q3 2021.

    Commenting on the results, Chip Childs, Chief Executive Officer of SkyWest, said, “We continue to experience strong demand for our product and our operational performance through the busy summer season was strong with 99.9% adjusted completion this quarter. We were pleased to have finalized new salary scales for our pilots during the quarter and continue efforts to stabilize our crew imbalance. I want to thank our people for their dedicated, world-class efforts.”

     

    Financial Results

    Revenue was $789 million in Q3 2022, up $44 million or 6%, from $745 million in Q3 2021. This quarter’s year-over-year increase in revenue under SkyWest’s flying contracts came from adding 33 E175 aircraft to its operations since Q3 2021 and eliminating the COVID-19 partner revenue concessions from Q3 last year.

    1 See Financial Results and Reconciliation of non-GAAP financial measures sections of this release for more information. 1

Operating expenses were $714 million in Q3 2022, up 2% from $698 million in Q3 2021. The increase in operating expenses was primarily due to an increase in salaries, wages, and benefits, offset by a decrease in maintenance costs for Q3 2022, compared to Q3 2021.

Capital and Liquidity

SkyWest had $1.0 billion in cash and marketable securities at September 30, 2022, up from $975 million at June 30, 2022, and $860 million at December 31, 2021.

Total debt at September 30, 2022 was $3.4 billion, up from $3.3 billion at June 30, 2022, reflecting the financing of nine new E175 aircraft delivered in Q3 2022. Capital expenditures during Q3 2022 were $224 million for the purchase of these nine E175s and other fixed assets.

Status Update on Previously Announced Agreements

SkyWest is coordinating with its major airline partners to optimize the timing of upcoming fleet deliveries under previously announced agreements. SkyWest expects to finance the future E175 deliveries discussed below through debt. The anticipated future delivery dates summarized below are based on currently available information and are subject to change.

Flying contract with American for 20 E175 aircraft

Two aircraft were delivered in Q3 2022, completing the 20 E175 aircraft deliveries under this contract.

Flying contract with Delta for 16 E175 aircraft

  •   Seven aircraft were delivered in Q3 2022.
  •   Four aircraft deliveries are anticipated in Q4 2022.
  •   Three aircraft are anticipated to be delivered in 2023 and 2024.
  •   Two aircraft were delivered prior to Q3 2022.

Flying contract with Alaska for 11 E175 aircraft

One aircraft is expected to be delivered in 2025, which will complete the 11 E175 aircraft deliveries under this contract.

Combined, SkyWest anticipates placing 47 E175 aircraft into service under these three previously announced agreements by late 2025.

As of September 30, 2022, 39 aircraft were delivered and eight aircraft have deliveries scheduled through 2025. By the end of 2025, SkyWest is scheduled to operate a total of 240 E175 aircraft.

Top Copyright Photo: American Eagle Airlines (2nd)-SkyWest Airlines Embraer ERJ 170-200LR (ERJ 175) N519SY (msn 17000899) SEA (Brian Worthington). Image: 959076.

American Eagle-SkyWest aircraft photo gallery: