JetBlue Announces 2009 Annual Profit
Despite Economic Challenges, JetBlue Reports Highest Net Income Since 2003
NEW YORK, Jan. 28 /PRNewswire-FirstCall/ -- JetBlue Airways Corporation (Nasdaq: JBLU) today reported its results for the fourth quarter and full year 2009:
- Pre-tax income of $20 million in the fourth quarter. This compares to a pre-tax loss of $51 million in the year-ago period, which included a special charge of $53 million related to the valuation of JetBlue's auction rate securities.
- For the full year 2009, JetBlue reported pre-tax income of $99 million. This compares to a pre-tax loss of $90 million for the full year 2008.
- Net income for the fourth quarter was $11 million, or $0.04 per diluted share. This compares to JetBlue's fourth quarter 2008 net loss of $58 million, or $0.25 per diluted share.
- For the full year 2009, JetBlue reported net income of $58 million, or $0.20 per diluted share. This compares to a net loss of $85 million, or $0.37 per diluted share, for the full year 2008.
"We are proud to have reported a profit in each quarter of 2009, one of only a few U.S. airlines to have done so," said Dave Barger, JetBlue's CEO. "We are also pleased to have generated positive free cash flow in 2009 for the first time in JetBlue's history. These strong results, against the backdrop of a challenging economic environment, reflect the hard work and dedication of our outstanding crewmembers. As we enter our second decade of operations, we remain focused on our goal of building long-term value for our shareholders, customers and crewmembers."
Operational Performance
Operating revenues for the fourth quarter totaled $832 million, representing growth of 2.6% over operating revenues of $811 million in the fourth quarter of 2008. For the full year, operating revenues totaled $3.29 billion, representing a decline of 3.0% over operating revenues of $3.39 billion for the full year 2008.
For the fourth quarter, revenue passenger miles increased 7.4% year-over-year to 6.3 billion on a capacity increase of 6.3%, resulting in a fourth quarter load factor of 79.4%, an increase of 0.8 points year over year.
Yield per passenger mile in the fourth quarter was 11.62 cents, down 5.0% compared to the fourth quarter of 2008. Passenger revenue per available seat mile (PRASM) for the fourth quarter 2009 decreased 4.0% year-over-year to 9.23 cents and operating revenue per available seat mile (RASM) decreased 3.6% year-over-year to 10.41 cents.
Operating expenses for the quarter increased 0.9%, or $6 million, over the prior year period. JetBlue's operating expense per available seat mile (CASM) for the fourth quarter decreased 5.2% year-over-year to 9.62 cents. Excluding fuel, CASM increased 6.4% to 6.71 cents.
Fuel Expense and Hedging
JetBlue hedged approximately 66% of its fuel consumption during the fourth quarter, resulting in a realized fuel price of $2.08 per gallon, a 24.1% decrease over fourth quarter 2008 realized fuel price of $2.75. JetBlue recorded $1 million in gains on fuel hedges that settled during the fourth quarter.
JetBlue's fourth quarter fuel price includes approximately $8 million in fuel taxes. During the quarter, JetBlue reclassified its fuel taxes from other operating expenses to fuel expense for both the current and all prior periods. Excluding these taxes, JetBlue's fourth quarter fuel price was $2.01 per gallon.
JetBlue has hedged approximately 64% of its first quarter projected fuel requirements and 45% of its 2010 projected fuel requirements with a combination of crude call options, jet fuel swaps and heating oil collars. JetBlue expects an average price per gallon of fuel, including the impact of hedges and fuel taxes, of $2.18 in the first quarter and $2.26 for the full year 2010.
Balance Sheet Update
JetBlue ended the year with $1.1 billion in unrestricted cash and short term investments.
"During 2009, we improved upon our already strong financial position while maintaining one of the best liquidity positions in the U.S. airline industry relative to our size," said Ed Barnes, JetBlue's CFO. "With minimal debt maturities and capital commitments in the upcoming year, we believe JetBlue is positioned to generate positive free cash flow and maintain strong liquidity in 2010."
First Quarter and Full Year Outlook
"Looking ahead to 2010, we will continue to invest in strategic areas of our business," said Barnes. "While we expect the transition to our new customer service system as well as the timing of certain aircraft maintenance expense to pressure costs during the first half of the year, we expect these unit cost increases to be offset by higher revenue from product and network initiatives in the second half of the year."
For the first quarter of 2010, PRASM and RASM are expected to be in the range of down one to up two percent year over year. CASM is expected to increase between seven and nine percent over the year-ago period. Excluding fuel, CASM in the first quarter is expected to increase between six and eight percent year over year.
PRASM and RASM for the full year are expected to increase between five and eight percent year over year. CASM for the full year is expected to increase between five and seven percent over full year 2009. Excluding fuel, CASM in 2010 is expected to increase between three and five percent year over year.
"We will continue to strategically deploy our aircraft to take advantage of attractive growth opportunities, particularly in Boston and the Caribbean," said Barnes.
Capacity is expected to increase between six and eight percent in the first quarter and to increase between five and seven percent for the full year. JetBlue expects all of its capacity growth to be driven by its Boston and Caribbean markets. Capacity in the rest of JetBlue's network is expected to decrease year over year.
JetBlue will conduct a conference call to discuss its quarterly earnings today, January 28, at 10:00 a.m. Eastern Time. A live broadcast of the conference call will be available via the internet at http://investor.jetblue.com.
About JetBlue
New York-based JetBlue Airways has created a new airline category based on value, service and style. Known for its award-winning service and free TV as much as its low fares, JetBlue is now pleased to offer customers Lots of Legroom and super-spacious Even More Legroom seats. JetBlue introduced complimentary in-flight e-mail and instant messaging services on aircraft "BetaBlue," a first among U.S. domestic airlines. JetBlue is also America's first and only airline to offer its own Customer Bill of Rights, with meaningful and specific compensation for customers inconvenienced by service disruptions within JetBlue's control. Visit www.jetblue.com/promise for details. JetBlue serves 60 cities with 600 daily flights. With JetBlue, all seats are assigned, all fares are one-way, and an overnight stay is never required. For information or reservations call 1-800-JETBLUE (1-800-538-2583), TTY/TDD 1-800-336-5530 or visit www.jetblue.com.
This press release contains statements of a forward-looking nature which represent our management's beliefs and assumptions concerning future events. When used in this document and in documents incorporated herein by reference, the words "expects," "plans," "anticipates," "indicates," "believes," "forecast," "guidance," "outlook," "may," "will," "should," "seeks," "targets" and similar expressions are intended to identify forward-looking statements. Forward-looking statements involve risks, uncertainties and assumptions, and are based on information currently available to us. Actual results may differ materially from those expressed in the forward-looking statements due to many factors, including, without limitation, our extremely competitive industry; volatility in financial and credit markets which could affect our ability to obtain debt and/or lease financing or to raise funds through debt or equity issuances; increases in fuel prices, maintenance costs and interest rates; our ability to implement our growth strategy, including the ability to operate reliably the EMBRAER 190 aircraft and our new terminal at JFK; our significant fixed obligations; our ability to attract and retain qualified personnel and maintain our culture as we grow; our reliance on high daily aircraft utilization; our dependence on the New York metropolitan market and the effect of increased congestion in this market; our reliance on automated systems and technology; our being subject to potential unionization; our reliance on a limited number of suppliers; changes in or additional government regulation; changes in our industry due to other airlines' financial condition; a continuance of the economic recessionary conditions in the U.S. or a further economic downturn leading to a continuing or accelerated decrease in demand for domestic and business air travel; and external geopolitical events and conditions. Further information concerning these and other factors is contained in the Company's Securities and Exchange Commission filings, including but not limited to, the Company's 2008 Annual Report on Form 10-K as updated by our Current Reports on Form 8-K filed on June 1, 2009 and August 26, 2009, and Quarterly Reports on Form 10-Q. We undertake no obligation to update any forward-looking statements to reflect events or circumstances that may arise after the date of this release.
JETBLUE AIRWAYS CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except share and per share amounts)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------ Percent ------------ Percent
2009 2008 Change 2009 2008 Change
---- ---- ------ ---- ---- ------
OPERATING REVENUES
Passenger $737 $722 2.1 $2,928 $3,056 (4.2)
Other 95 89 6.5 358 332 7.7
-- -- --- ---
Total operating
revenues 832 811 2.6 3,286 3,388 (3.0)
OPERATING EXPENSES
Aircraft fuel and
related taxes 232 288 (19.3) 945 1,397 (32.3)
Salaries, wages
and benefits 200 175 14.7 776 694 11.8
Landing fees
and other rents 53 48 11.7 213 199 6.8
Depreciation
and amortization 58 60 (2.9) 228 205 11.4
Aircraft rent 31 32 (3.7) 126 129 (2.1)
Sales and
marketing 38 33 12.0 151 151 (0.5)
Maintenance
materials
and repairs 38 30 27.2 149 127 17.6
Other operating
expenses 118 96 22.5 419 377 11.1
--- -- --- ---
Total operating
expenses 768 762 0.9 3,007 3,279 (8.3)
--- --- ----- -----
OPERATING INCOME 64 49 28.5 279 109 154.5
Operating margin 7.6% 6.1% 1.5 pts. 8.5% 3.2% 5.3 pts.
OTHER INCOME (EXPENSE)
Interest expense (49) (60) (20.8) (197) (242) (19.0)
Capitalized
interest 1 5 (64.4) 7 48 (84.3)
Interest income
and other 4 (45) 106.9 10 (5) 286.8
- --- -- --
Total other
income (expense) (44) (100) (57.0) (180) (199) (10.3)
--- ---- ---- ----
INCOME (LOSS) BEFORE
INCOME TAXES 20 (51) 99 (90)
Pre-tax margin 2.4% (6.4)% 8.8 pts. 3.0% (2.7)% 5.7 pts.
Income tax
expense (benefit) 9 7 41 (5)
- - -- --
NET INCOME (LOSS) $11 $(58) $58 $(85)
=== ==== === ====
EARNINGS (LOSS) PER
COMMON SHARE:
Basic $0.04 $(0.25) $0.22 $(0.37)
===== ====== ===== ======
Diluted $0.04 $(0.25) $0.20 $(0.37)
===== ====== ===== ======
Weighted average
shares
outstanding
(thousands):
Basic 273,120 239,283 260,486 226,262
Diluted 303,532 239,283 332,063 226,262
COMPARATIVE OPERATING STATISTICS
Three Months Ended Twelve Months Ended
December 31, Percent December 31, Percent
------------ ------------
2009 2008 Change 2009 2008 Change
---- ---- ------ ---- ---- ------
Revenue passengers
(thousands) 5,457 5,108 6.8 22,450 21,920 2.4
Revenue passenger
miles (millions) 6,343 5,904 7.4 25,955 26,071 (0.4)
Available seat
miles (ASMs)
(millions) 7,988 7,510 6.3 32,558 32,442 0.4
Load factor 79.4% 78.6% 0.8 pts. 79.7% 80.4% (0.7) pts.
Aircraft
utilization
(hours per day) 10.8 11.2 (3.4) 11.5 12.1 (5.0)
Average fare $135.07 $141.37 (4.5) $130.41 $139.40 (6.4)
Yield per
passenger mile
(cents) 11.62 12.23 (5.0) 11.28 11.72 (3.8)
Passenger
revenue per
ASM (cents) 9.23 9.62 (4.0) 8.99 9.42 (4.5)
Operating
revenue per
ASM (cents) 10.41 10.80 (3.6) 10.09 10.44 (3.4)
Operating
expense per
ASM (cents) 9.62 10.14 (5.2) 9.24 10.11 (8.6)
Operating
expense per
ASM, excluding
fuel (cents) 6.71 6.31 6.4 6.33 5.80 9.2
Airline operating
expense per
ASM (cents) (a) 9.35 9.86 (5.3) 8.99 9.87 (8.9)
Departures 52,207 49,763 4.9 215,526 205,389 4.9
Average stage
length (miles) 1,091 1,075 1.6 1,076 1,120 (3.9)
Average number
of operating
aircraft
during period 151.0 139.9 8.0 148.0 139.5 6.1
Average fuel
cost per gallon $2.08 $2.75 (24.1) $2.08 $3.08 (32.6)
Fuel gallons
consumed
(millions) 112 105 6.4 455 453 0.4
Full-time
equivalent
employees at
period end (a) 10,704 9,895 8.2
(a) Excludes operating expenses and employees of LiveTV, LLC, which
are unrelated to our airline operations.
SELECTED CONSOLIDATED BALANCE SHEET DATA
(in millions)
December 31, December 31,
2009 2008
---- ----
Cash and cash equivalents 896 $561
Total investment securities 246 244
Total assets 6,554 6,020
Total debt 3,304 3,144
Stockholders' equity 1,539 1,266
SOURCE: JetBlue Airways Corporation
SOURCE JetBlue Airways Corporation
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