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Frontier Profitability?  
User currently offlineLrgt From United States of America, joined Jul 2004, 711 posts, RR: 0
Posted (10 years 4 months 3 weeks 5 days 1 hour ago) and read 1529 times:

F9 (Frontier) has recently finally been posting a profit (barely though). Does anyone know whether this will go on? Perhaps they will become even more profitable?

Any F9 employees seeing an improvement of profitability or perhaps a return to unprofitability?

Here is a operating cost comparison:
F9: Cost per ASM $0.0739, Load Factor 77%, Average Flight: 967 Mi
FL: Cost per ASM $0.0828, Load Factor 75%, Average Flight: 616 Mi
US: Cost per ASM $0.1343, Load Factor 82%, Average Flight: 754 Mi


Don't bring up the NW DC9's unless you have to!
6 replies: All unread, jump to last
 
User currently offlineMariner From New Zealand, joined Nov 2001, 25687 posts, RR: 85
Reply 1, posted (10 years 4 months 3 weeks 5 days 1 hour ago) and read 1478 times:
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Lrgt:

No. Like most other airlines, Frontier has been hard hit by the price of fuel. The CEO has stated that they will make a loss this quarter.

Whether or not they make a profit for the full financial year - as they were profitable last year - depends, largely, on the price of fuel.

cheers

mariner



aeternum nauta
User currently offlineAlphascan From United States of America, joined Nov 2003, 937 posts, RR: 13
Reply 2, posted (10 years 4 months 3 weeks 5 days ago) and read 1426 times:

Lrgt:

The numbers you used for F9 above confused CASM with RASM. CASM is reported on a quarterly basis with the financial report. RASM is reported on both the financials and the monthly traffic report.

http://www.frontierairlines.com/news/articleDisplay.asp?article=/Financials/2004/pr_042004.news


The F9 CASM including fuel for the last reported quarter was $0.0848; $0.0831 for the fiscal year.

The F9 CASM excluding fuel for the last reported quarter and fiscal year was $0.0679.

Load Factor for the last reported quarter was 70.9% and 71.6% for the fiscal year.

Generally, FL has a lower CASM than F9.




"To he who only has a hammer in his toolbelt, every problem looks like a nail."
User currently offlineAirportguy1971 From United States of America, joined Aug 2003, 355 posts, RR: 1
Reply 3, posted (10 years 4 months 3 weeks 4 days 22 hours ago) and read 1346 times:

Mariner

When was it stated that there'd be a loss. Last I heard it was too close to call.


User currently offlineMariner From New Zealand, joined Nov 2001, 25687 posts, RR: 85
Reply 4, posted (10 years 4 months 3 weeks 4 days 21 hours ago) and read 1331 times:
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Airportguy:

During the conference call in May. The CEO said that Q1 (April/June '04) was likely to be a loss with the continued high oil prices.

However, he did say that whether the full year would be profit or loss was "too close to call."

cheers

mariner



aeternum nauta
User currently offlineType-rated From , joined Dec 1969, posts, RR:
Reply 5, posted (10 years 4 months 3 weeks 4 days 17 hours ago) and read 1290 times:

But with OPEC stating that they would step up production soon we can expect prices to start coming down slightly. What did F9 hedge vs FL hedge?

User currently offlineMariner From New Zealand, joined Nov 2001, 25687 posts, RR: 85
Reply 6, posted (10 years 4 months 3 weeks 4 days 17 hours ago) and read 1284 times:
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Type-rated:

I think that oil may come down slightly, but only slightly. Fear (Iraq, the oil confusion in Russia) is driving the market.

Frontier had only recently started hedging fuel - as CEO Potter said "we're new to this" - and had only small hedges in place, managed in-house.

Then, when oil prices got really out of hand, two things happened:

http://www.solarc.com/index2.asp?category=News&level2Entity=3990&contentID=727

That was June '04. Solarc is not a fuel hedger, but a fuel manager, which, presumably, includes some advice on hedging, such as when and how much.

Then this appeared:

http://money.excite.com/jsp/nw/nwdt_ge.jsp?news_id=dji-00088220040715&feed=dji&date=20040715

The 25% fuel hedge for six months is new, and, given the timing, must have been taken out when crude oil was about $35 bbl. Do I detect the hand of Solarc here?

Given that crude is trading over $41 bbl, it looks like a good move.

I remember that Continental took out a hedge in May at $40 bbl, and everyone said they were nuts.

Maybe. Maybe not.

cheers

mariner



aeternum nauta
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