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| AirTran Holdings, Inc., Reports Fourth Quarter and Year End Results |
The fourth quarter results demonstrated the benefits of "2008 was an especially tough and challenging year," said Revenues for the fourth quarter grew 1.0 percent to For the full year, capacity increased by 4.9 percent and traffic rose 9.6
percent, which resulted in a load factor of 79.6 percent. Total annual
revenues grew by 10.5 percent to Commenting on the fourth quarter performance,
Highlights of
Editor's note: Statements regarding the Company's operational and
financial success, business model, expectation about future success, improved
operational performance and our ability to maintain or improve our low costs
are forward-looking statements and are not historical facts. Instead, they are
estimates or projections involving numerous risks or uncertainties, including
but not limited to, consumer demand and acceptance of services offered by the
Company, the Company's ability to maintain current cost levels, fare levels
and actions by competitors, regulatory matters and general economic
conditions. Additional information concerning factors that could cause actual
results to differ materially from those in the forward-looking statements is
contained from time to time in the Company's SEC filings, including but not
limited to the Company's annual report on Form 10-K for the year ended
* Attached: Consolidated Statements of Operations
Media Contact: Tad Hutcheson
678.254.7442
Investor Relations:
We prepare our financial statements in accordance with generally accepted accounting principles (GAAP). Within our press release, we make reference to certain non-GAAP financial measures including EBITDA, EBITDA adjusted, operating margin adjusted, and net margin adjusted. Earnings before income taxes, interest, depreciation and amortization ("EBITDA") is a supplemental non-GAAP financial measure used by management, as well as industry analysts, to evaluate operations and operating performance. We are also presenting EBITDA because it is used by some industry analysts and investors as a way to assess a company's ability to incur and service debt, make capital expenditures and meet working capital requirements. Our disclosures may also exclude special or non-recurring items that we believe should be taken into consideration to more accurately measure and monitor our operating performance. Our disclosure of non-fuel operating cost per available seat mile (non-fuel CASM) is consistent with financial measures reported by other airlines and analysts. We believe that non-fuel CASM and non-fuel CASM adjusted provide a better understanding of our operations. Both the cost and availability of fuel are subject to many economic and political factors and are therefore beyond our control. Our press release also contains information regarding the components of GAAP fuel expense and net gains and loss on derivative financial instruments. These amounts have been included as supplemental information. We disclose both the average fuel cost per gallon and the average economic fuel cost per gallon. Average fuel cost per gallon is based on fuel expense as measured by GAAP and includes realized gains and losses on fuel related derivative instruments which are accounted for as hedges. Average economic fuel cost per gallon includes realized gains and losses on all fuel related derivative instruments, including those which were not accounted for as hedges. We consider our fuel derivative contracts an important tool in managing costs related to jet fuel purchases. We believe it is important to assess our financial performances by including the effect of the quarterly net cash settlements and excluding the mark-to-market adjustments for our unrealized gains and losses recorded in the income statement for contracts settling in future periods. We believe that these measures represent important internal measures of
performance. Accordingly, where these non-GAAP measures are provided, it is
done so that investors have the same financial data that management uses in
evaluating performance with the belief that it will assist the investment
community in assessing our underlying performance on a year-over-year and a
quarter-over-quarter basis. However, because these measures are not determined
in accordance with accounting principles generally accepted in the
Dollars in thousands, unless otherwise noted
Three months ended Twelve months ended
December 31, December 31,
------------ ------------
2008 2007 2008 2007
---- ---- ---- ----
The following table
reconciles net income
(loss) to
EBITDA and EBITDA
adjusted:
Net income (loss) $(118,391) $(2,171) $(273,829) $52,683
Add back:
Income tax
expense (benefit)
4,168 1,441 (18,063) 34,669
Interest, net 21,391 13,928 69,046 45,903
Depreciation 15,394 13,613 58,618 48,485
------ ------ ------ ------
EBITDA $(77,438) $26,811 $(164,228) $181,740
Less:
Gain on sale of
assets 5,503 - 23,185 6,234
Impairment of
goodwill - - (8,350) -
Midwest exchange
offer expenses - - - (10,650)
Unrealized gains
(losses) on
derivative
financial
instruments 2,010 (1,695) (24,531) (255)
----- ------ ------- ----
EBITDA adjusted $(84,951) $28,506 $(154,532) $186,411
======== ======= ========= ========
The following table
calculates operating
margin adjusted:
Operating income
(loss) $54,854 $14,893 $(72,010) $144,160
Less:
Gain on sale of
assets 5,503 - 23,185 6,234
Impairment of
goodwill - - (8,350) -
------- ------- ------- -------
Operating income
(loss) adjusted $49,351 $14,893 $(86,845) $137,926
======= ======= ======== ========
Total operating
revenues $589,415 $583,836 $2,552,478 $2,309,983
-------- -------- ---------- ----------
Operating
margin,
adjusted 8.4% 2.6% -3.4% 6.0%
=== === ==== ===
The following table
calculates net margin
adjusted:
Net income (loss) $(118,391) $(2,171) $(273,829) $52,683
Less:
Gain on sale of
assets, after tax
5,503 - 23,185 3,896
Impairment of
goodwill - - (8,350) -
Midwest exchange
offer expenses - - - (6,656)
Unrealized gains
(losses) on
derivative
financial
instruments ,
after tax 2,010 (1,059) (24,531) (159)
----- ------ ------- ----
Net income (loss),
adjusted $(125,904) $(1,112) $(264,133) $55,602
========= ======= ========= =======
Total operating
revenues $589,415 $583,836 $2,552,478 $2,309,983
-------- -------- ---------- ----------
Net margin, adjusted -21.4% -0.2% -10.3% 2.4%
===== ==== ===== ===
The following table
calculates operating
cost per ASM adjusted:
Total operating
expenses $534,561 $568,943 $2,624,488 $2,165,823
Add: gain on sale
of assets 5,503 - 23,185 6,234
Less: impairment
of goodwill - - (8,350) -
------- ------- ------- -------
Operating costs,
adjusted $540,064 $568,943 $2,639,323 2,172,057
======== ======== ========== =========
ASMs (000) 5,359,177 5,732,017 23,809,190 22,692,355
--------- --------- ---------- ----------
Operating cost
per ASM (cents)
adjusted 10.08 9.93 11.09 9.57
===== ==== ===== ====
The following table
calculates non-fuel
operating
cost per ASM and non-
fuel operating cost
per ASM
adjusted:
Total operating
expenses $534,561 $568,943 $2,624,488 $2,165,823
Less: aircraft fuel (194,487) (221,105) (1,194,938) (803,640)
-------- -------- ---------- --------
Operating costs,
adjusted $340,074 $347,838 $1,429,550 $1,362,183
======== ======== ========== ==========
ASMs (000) 5,359,177 5,732,017 23,809,190 22,692,355
Non-fuel
operating cost
per ASM (cents) 6.35 6.07 6.00 6.00
==== ==== ==== ====
Total operating
expenses $534,561 $568,943 $2,624,488 $2,165,823
Less: aircraft fuel (194,487) (221,105) (1,194,938) (803,640)
Add: gain on sale
of aircraft 5,503 - 23,185 6,234
Less: impairment of
goodwill - - (8,350) -
------- ------- ------- -------
Non-fuel operating
cost, adjusted $345,577 $347,838 $1,444,385 $1,368,417
======== ======== ========== ==========
ASMs (000) 5,359,177 5,732,017 23,809,190 22,692,355
Non-fuel
operating cost
per ASM (cents)
adjusted 6.45 6.07 6.07 6.03
==== ==== ==== ====
The following table
provides detail of
certain components of
aircraft fuel expense
and calculates average
economic cost of
aircraft fuel per
gallon:
Aircraft fuel
expense per GAAP 194,487 221,105 1,194,938 803,640
Add Realized
(gains) losses on
derivatives that do
not
qualify for hedge
accounting,
recorded in net
(gains)
losses on
derivatives 40,327 16,936
Add Realized
(gains) losses on
derivatives related
to
2009 contracts
terminated,
recorded in net
(gains)
losses on
derivatives 109,370 109,370
------- -------
Economic fuel
expense $344,184 $1,321,244
======== ========== ========== ===========
Gallons of fuel
burned 83,999,581 90,307,722 367,168,620 359,759,033
---------- ---------- ----------- -----------
Economic fuel
expense per
gallon (dollars) $4.10 $2.45 $3.60 $2.23
===== ===== ===== =====
The following table
reconciles net income
(loss) and earnings
(loss)
per share to net income
(loss) adjusted and
earnings (loss) per
share adjusted:
Net income (loss) $(118,391) $(273,829)
Add back:
Impairment of
goodwill - 8,350
Realized and
unrealized (gains)
losses on
derivative
financial
instruments
related to 2009
contracts 107,360 133,901
Less:
Gain on sale of
assets, after tax
(5,503) (23,185)
------ -------
Net income (loss),
adjusted $(16,534) $(154,763)
======== =========
Diluted shares
outstanding 118,034 109,153
------- -------
Earnings (loss) per
share, adjusted $(0.14) $(1.42)
====== ======
SOURCE |
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