apodino
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SkyWest Q4 And 2011 Earnings Results

Fri Feb 17, 2012 6:59 pm

Didn't see this posted yet surprisingly....

Q4 Loss of $17.9 Million
2011 Year Loss of $27.3 Million

According to the financial statement basically staffing issues have led to more personnel being needed, in addtion, labor and MX costs have spiked and have outpaced revenue, which led to the loss.

http://www.prnewswire.com/news-relea...uarter-2011-results-139428888.html

The bigger story here is Skywest is now losing money. RAH is losing Money. Pinnacle air group is on the verge of Bankruptcy. Mesa has been in and out of Bankrupcy and went private. Is the regional model no longer a viable business model? It seems like regionals now have a lot of red ink on their balance sheet. What is going to happen with the pressures on them.
 
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mariner
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RE: SkyWest Q4 And 2011 Earnings Results

Fri Feb 17, 2012 7:32 pm

Quoting apodino (Thread starter):
RAH is losing Money.

It is?

Q4 hasn't been announced yet, but the company just raised Q4 profit guidance from 9 cents a share to 31 cents a share, analysts are estimating a full year 2011 profit and here's Q3 2011:

http://crackerjackinvesting.com/2011...irlines-aren’t-all-disappearing/

"Republic Airways (RJET) Returns to Profitability – The Airlines Aren’t All Disappearing

Republic reported EPS of $0.40 (ex-special items) which was well ahead of consensus estimates of $0.24."


  

mariner
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Maverick623
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RE: SkyWest Q4 And 2011 Earnings Results

Fri Feb 17, 2012 7:44 pm

Quoting apodino (Thread starter):
staffing issues have led to more personnel being needed
Quoting apodino (Thread starter):
labor ... costs have spiked

That tends to happen: hire more people, pay more for them.

Quoting apodino (Thread starter):
Is the regional model no longer a viable business model?

Frankly, the entire airline industry is not a viable business model. As a whole, it has lost tens of billions of dollars over it's 100 year span.

Even in the 90s, when oil and labor were cheap, almost every single US mainline carrier either filed bankruptcy or closed up shop. All this talk about "high labor and maintenance and fuel costs" is just smokescreen for the fact that it is nearly impossible for airlines to consistently turn a profit.
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apodino
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RE: SkyWest Q4 And 2011 Earnings Results

Sat Feb 18, 2012 4:00 am

Quoting Maverick623 (Reply 2):
Frankly, the entire airline industry is not a viable business model. As a whole, it has lost tens of billions of dollars over it's 100 year span.

The Catch 22 is that its such a vital part of our economy and if you lose it you create a lot of economic problems in other areas, but at the same time it itself isn't economically viable. Maybe its time to get Wall Street out of the business and change their focus from making money for shareholders to delivering a good product to the customers. I don't know, but it is very important.

Quoting mariner (Reply 1):
It is?

Q4 hasn't been announced yet, but the company just raised Q4 profit guidance from 9 cents a share to 31 cents a share, analysts are estimating a full year 2011 profit and here's Q3 2011:

The report you cited didn't include special items though. That being said, they still have a lot of issues to deal with out there and who knows if they can keep this up



The unanswered question is...what has happened to SkyWest? (And very quietly I might add) For many years this was the best run regional carrier out there and one of the most respected. They were not only consistently profitable, but their stock was paying a dividend every quarter as well and now to post a full year loss is mindboggling. And what does this mean going forward? This will create some issues going forward.

1. Given that Labor costs are a part of this, are they going to be cutting pay? The ExpressJet side is ALPA for the pilots and there was a contract ratified recently I believe as part of the ASA merger. Where the problem is created is on the OO certificate. The OO pilots are going to be in a Catch 22. They aren't in a position right now to avoid concessions if that is where the company was going, but if they join ALPA, then they would be end up having to be merged into the ExpressJet seniority list which will displace a lot of people and has been a key factor in keeping ALPA off of the Skywest side.

2. Are they going to seek amendments to existing flying contracts, and given that their costs are rising, are they going to be in a position to bid on new flying if it materializes (which is a likely outcome of the AA bankruptcy), and are they going to look to renegotiate flying deals.

3, The future of the 120 fleet? If this is the reason for the escalating MX costs, will their retirement be accelerated? Also the CRJ's have to be part of the MX problems. I know from experience that these things dispatch reliability is not the greatest, and given the fleet is getting older, they are becoming more costly to maitain.
 
dtwpilot225
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RE: SkyWest Q4 And 2011 Earnings Results

Sat Feb 18, 2012 4:11 am

Ok crazy rumor alert. I hate spreading stuff that probably isn't true but this was so out there that I had to post it. There is a small rumor floating around that skywest may purchase pinnacle and the combined airline would flow pilots into delta as the need greatly rises in the next 10 years.
I don't believe it either
 
Goldenshield
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RE: SkyWest Q4 And 2011 Earnings Results

Sat Feb 18, 2012 4:17 am

Quoting apodino (Reply 3):
The unanswered question is...what has happened to SkyWest?

Expressjet happened, but that's an INC issue. Before the merger, ASA was squeeking a profit, but it was still a profit.
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mariner
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RE: SkyWest Q4 And 2011 Earnings Results

Sat Feb 18, 2012 5:00 am

Quoting apodino (Reply 3):
The report you cited didn't include special items though. That being said, they still have a lot of issues to deal with out there and who knows if they can keep this up


Special charges are often discounted because they are one-time, non-core events and many of them are "non-cash" - write downs, impairments, for tax purposes.

Republic may have "issues" (?) but you said it is losing money. The analysts are estimating a full year 2012 profit, despite the already known existence of a $200 million - essentially non-cash - impairment charge (write-downs on aircraft).

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KAUSpilot
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RE: SkyWest Q4 And 2011 Earnings Results

Sat Feb 18, 2012 5:07 am

The ironic thing is that competitive pressure from Skywest pre-Expressjet merger was what forced ExpressJet to sign a money losing, cost-minus contract with their primary customer, Continental. ExpressJet had to undercut Skywest or face liquidation. Now Skywest is reaping the the detriments of that money losing ExpressJet COEX CPA. ExpressJet was forced to cut costs and as a result began eating into Skywest's bread and butter United Express markets through a newly signed contract with UAL. This was the impetus for Skywest's eventual purchase of ExpressJet.

You can argue "labor costs" until you're blue in the face but if the revenue isn't there, even everyone working for free won't generate a profit. Skywest tried to kill ExpressJet by underbidding them, failed, and now has to recuperate the very animal they wounded. Now that ExpressJet and ASA are nearly merged, I can't envision Skywest divesting itself of those holdings, either. Not the best planning by Skywest management, methinks.

[Edited 2012-02-17 21:10:50]
 
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mariner
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RE: SkyWest Q4 And 2011 Earnings Results

Sat Feb 18, 2012 10:06 am

Quoting apodino (Reply 3):
The unanswered question is...what has happened to SkyWest? (And very quietly I might add) For many years this was the best run regional carrier out there and one of the most respected. They were not only consistently profitable, but their stock was paying a dividend every quarter as well and now to post a full year loss is mindboggling. And what does this mean going forward? This will create some issues going forward.

Sky west is blaming the loss mostly on the acquisition of Expressjet:

http://www.sltrib.com/sltrib/money/5...ressjet-quarter-financial.html.csp

"SkyWest Inc. on Thursday capped off a difficult 2011 by announcing a big fourth-quarter loss that the regional airline attributed largely to trouble merging its ExpressJet acquisition into its Atlantic Southeast Airline subsidiary.

The loss, which SkyWest didn’t expect when it entered the quarter, cemented the company’s first annual loss since 1988. Red ink for all of 2011 totaled $27.3 million, while a year earlier it earned $96.4 million.

"Our expectations for a near-perfect execution were unrealistic from a financial perspective. It took us longer to gain good control of the planning and financial management of ExpressJet than we had planned, which resulted in missed financial plans in every quarter of this year," SkyWest CEO Jerry Atkin said in a conference call with analysts."


Skywest also expects another loss this quarter but then expects to be in in the black again or a full year profit:

"SkyWest’s struggle with ExpressJet isn’t over. SkyWest expects another loss in the first quarter, which ends March 31. Afterward, though, it forecasts moving out of the red and ending 2012 fully profitable, Atkin said."

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bhmdiversion
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RE: SkyWest Q4 And 2011 Earnings Results

Sat Feb 18, 2012 5:58 pm

Quoting dtwpilot225 (Reply 4):
Ok crazy rumor alert. I hate spreading stuff that probably isn't true but this was so out there that I had to post it. There is a small rumor floating around that skywest may purchase pinnacle and the combined airline would flow pilots into delta as the need greatly rises in the next 10 years.
I don't believe it either

Are you kidding me? Every employee at Pinnacle would have a wet dream over this one, but it will never happen. SkyWest doesn't want MEM, nor the organized FA and Pilot groups.
 
dtwpilot225
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RE: SkyWest Q4 And 2011 Earnings Results

Sat Feb 18, 2012 8:48 pm

hey like i said i dont believe it either,