JetBlue Airways today announced it is expanding its presence in Havana and Mexico City with three new routes and more flights from the airline’s northeast and south Florida focus cities.
JetBlue will offer New England’s first nonstop service to Cuba with flights on Saturdays between Boston’s Logan International Airport (BOS) and Havana’s Jose Marti International Airport (HAV) beginning November 10, 2018. JetBlue will further expand service to Cuba with up to three daily flights between Fort Lauderdale-Hollywood International Airport (FLL) and Havana on Sundays through Fridays beginning November 11, 2018. The new service is the result of frequencies granted to the airline by the U.S. Department of Transportation. The routes are subject to government approval and will go on sale in the coming weeks.
JetBlue also announced plans to introduce two new daily nonstop flights to Mexico City with service from Boston and New York’s John F. Kennedy International Airport (JFK) beginning October 25, 2018. The new routes, subject to government approval, will add to JetBlue’s existing service to Mexico City from Orlando International Airport (MCO) and Fort Lauderdale/Hollywood. With this new service, JetBlue will offer six daily flights between the U.S. and Mexico’s capital city.
JetBlue’s new service to Mexico City follows a decision by the U.S. Department of Transportation to require certain airlines to divest airport slots in order to enhance competition at Mexico City International Airport.
All new service to Cuba and Mexico will be operated on JetBlue’s Airbus A320 aircraft.
JetBlue’s became the first airline to operate commercial flights between the U.S. and Cuba in 2016. Commercial service followed nearly five years of successful charter service operating multiple routes between Cuban markets and U.S. cities. In that time, JetBlue built strong relationships with airport authorities and worked closely together to make the successful launch of commercial service possible.
All U.S. customers traveling to Cuba must be authorized to do so under the U.S. government’s Cuban Assets Control Regulations and they must certify that they qualify for one of the twelve approved travel categories outlined by the U.S. Department of Treasury. All travelers to Cuba must make their own determinations with respect to the appropriate travel category, as well as the type of visa required by Cuba for their purpose of travel.
Copyright Photo: JetBlue Airways Airbus A320-232 WL N709JB (msn 3488) (Binary Code) LGB (Michael B. Ing). Image: 941504.
JetBlue Airways (New York) is celebrating its one millionth customer to connect to its high-speed Fly-Fi system, also making JetBlue the first airline worldwide to connect one million personal electronic devices (PEDs) to true broadband Ka-based Wi-Fi service. To celebrate, the 140 customers onboard “CONNECTED TO 01000010 01001100 01010101 01000101,” JetBlue’s Fly-Fi livery aircraft (above), were rewarded with a total one million TrueBlue points on a flight from New York’s JFK International Airport to San Diego International Airport.
JetBlue launched Fly-Fi, the fastest Wi-Fi among all U.S. airlines, last December. Fly-Fi offers broadband speed via Ka-band satellite using satellite-to-aircraft connectivity rather than the ground-to-aircraft connectivity, or Ku-band, the many other U.S. carriers offer. Fly-Fi is currently available on 70 aircraft, with an additional 10-12 aircraft being Fly-Fi enabled each month. The entire JetBlue fleet will be Fly-Fi installed by the end of 2015. JetBlue is now the only airline in the world to offer free live television at every seat and free high-speed Wi-Fi. JetBlue was also the first U.S. airline to offer gate-to-gate use of personal electronic devices (PEDs), as of November 2013.
During fourth quarter 2015, JetBlue will launch a new Fly-Fi Portal, which will serve as a content hub where customers can access a wide range of movies, television shows and additional content from their own personal devices.
in other news, the company this week will introduce its 10th reoccurring tail design. Management has informed its employees it will introduce a new Gaelic-inspired “Tartan” tail fin design. The design is really an updated version of the retired “Plaid” design with new diagonal bold lines with a hint of green.
The first aircraft to be repainted in the new “Tartan” design is Airbus A320-232 N565JB (msn 2031).
Copyright Photo: Ken Petersen/AirlinersGallery.com. Airbus A320-232 N709JB (msn 3488) in the special Binary Code livery departs from Raleigh-Durham.
JetBlue Airways Corporation (JetBlue Airways) (New York) today reported its results for the second quarter 2014:
Pre-tax income excluding special items1 of $103 million in the second quarter. This compares to pre-tax income of $60 million in the second quarter of 2013.
Gain of $242 million from the sale of its wholly-owned subsidiary LiveTV.
On a GAAP basis, pre-tax income of $345 million in the second quarter.
Net income excluding special items for the second quarter was $61 million, or $0.19 per diluted share.
This compares to JetBlue’s second quarter 2013 net income of $36 million, or $0.11 per diluted share.
On a GAAP basis, net income for the second quarter was $230 million, or $0.68 per diluted share.
“Today, we are pleased to report record second quarter earnings and our seventeenth consecutive quarter of profitability,” said Dave Barger, JetBlue’s Chief Executive Officer. “We saw improved profitability across our network, reflecting the success of ongoing efforts to adapt our products and services to meet our customers’ ever-changing needs. I would like to thank our 15,500 crewmembers for their dedication to running a safe airline and delivering outstanding service to our customers.”
JetBlue reported record second quarter operating revenues of $1.5 billion. Revenue passenger miles for the second quarter increased 5.7% to 9.6 billion on a capacity increase of 6.0%, resulting in a second quarter load factor of 84.6%, a decrease of 0.3 points year over year.
Yield per passenger mile in the second quarter was 14.25 cents, up 6.3% compared to the second quarter of 2013. Passenger revenue per available seat mile (PRASM) for the second quarter 2014 increased 6.0% year over year to 12.05 cents and operating revenue per available seat mile (RASM) increased 5.6% year over year to 13.12 cents. The shift of the Easter and Passover holidays from March last year to April this year positively impacted second quarter year over year PRASM by approximately two points.
Operating expenses for the quarter increased 9.8%, or $119 million, over the prior year period. Interest expense for the quarter declined 7.5%, or $3 million, due to JetBlue’s focus on debt reduction. JetBlue’s operating expense per available seat mile (CASM) for the second quarter increased 3.5% year over year to 11.88 cents. Excluding fuel and profit sharing, CASM2 increased 5.1% to 7.51 cents.
“We improved margin performance while expanding our network, demonstrating the core strength of our business,” said Robin Hayes, JetBlue’s President. “We remain focused on providing a differentiated product and culture in high-value geography while maintaining competitive costs. We believe this focus will drive improved returns for our shareholders.”
Fuel Expense and Hedging
JetBlue continued to hedge fuel to manage price volatility. Specifically, in the second quarter JetBlue had in place hedges for approximately 15% of its fuel consumption and managed approximately 7% of its fuel consumption using fixed forward price agreements (FFPs). This resulted in a realized fuel price of $3.09 per gallon, a 0.9% increase over second quarter 2013 realized fuel price of $3.06. JetBlue recorded $2 million in losses on fuel hedges that settled during the second quarter.
JetBlue has managed approximately 30% of its third quarter projected fuel requirements using a combination of FFPs, jet fuel swaps and caps. Based on the fuel curve as of July 17th, JetBlue expects an average price per gallon of fuel, including the impact of hedges, FFPs and fuel taxes, of $3.08 in the third quarter.
Liquidity and Cash Flow
JetBlue ended the quarter with approximately $797 million in unrestricted cash and short term investments. In addition, JetBlue maintains $550 million in lines of credit.
During the second quarter, JetBlue repaid approximately $44 million in regularly scheduled debt and capital lease obligations. In addition, JetBlue pre-paid approximately $300 million in debt with the proceeds from the sale of LiveTV. JetBlue plans to repay approximately $185 million in regularly scheduled debt and capital lease obligations in the remainder of 2014, including approximately $58 million in the third quarter.
“We continued to strengthen the balance sheet by paying down debt while enhancing access to liquidity by increasing the number of unencumbered aircraft,” said Mark Powers, JetBlue’s Chief Financial Officer. “We believe these actions will help us maintain a relatively flat invested capital base this year while growing assets, which we expect will help us meet our return on invested capital goal.”
Third Quarter and Full Year Outlook
For the third quarter of 2014, CASM is expected to increase between 0.5% and 2.5% versus the year-ago period. Excluding fuel and profit sharing, CASM in the third quarter is expected to increase between 1.0% and 3.0% year over year.
CASM for the full year is expected to increase between 1.0% and 3.0% over full year 2013. Excluding fuel and profit sharing, CASM in 2014 is expected to increase between 2.5% and 4.5% year over year. Relative to JetBlue’s previous cost outlook, this full year guidance reflects approximately a one point reduction in unit costs excluding fuel and profit sharing primarily due to a reduction of operating expenses in the second half of the year as a result of the sale of LiveTV.
Capacity is expected to increase between 3.0% and 5.0% in the third quarter. For the full year, capacity is expected to increase between 4.0% and 6.0%.
Bloomberg Businessweek: JetBlue considers charging for the first checked bag: CLICK HERE
Copyright Photo: Jay Selman/AirlinersGallery.com. Airbus A320-232 N709JB (msn 3488) in the special one-off “Binary Code” livery arrives in New York (JFK).