HONOLULU, November 14, 2000 -- Hawaiian Airlines, Inc. (AMEX and PCX: HA) today announced financial results for the third quarter and nine months ended September 30, 2000.
Total operating revenues in the third quarter of 1999 increased 26.0 percent to $169.9 million as compared to $134.8 million in the same period last year. Operating income for the quarter was $1.0 million, compared to operating income of $6.9 million in the same period last year. The company reported a net loss of $218,000 or $0.01 per diluted share for the third quarter, compared to $3.4 million or $0.08 per diluted share for the same quarter last year.
Paul J. Casey, President and Chief Executive Officer, stated, "We are pleased to report continued substantial increases in revenues. Unfortunately, our 26 percent revenue growth was outpaced by higher operating expenses, led by fuel -- our second-largest cost item, which increased more than 60 percent over the same period last year."
Cost per available seat mile (CASM) increased 14.5 percent in the third quarter to 8.9 cents compared to 7.8 cents per ASM during the 1999 quarter. Contributing to the increase was: aircraft maintenance expense, nearly half of which was related to the company's DC-9 fleet; a 60 percent increase in fuel expense; increased labor expense related to capacity growth; the September 1, 1999 reinstatement of landing fees in Hawaii (a $1.6 million impact) and $851,000 in additional aircraft rent as two more DC-10 aircraft were flown in the third quarter of 2000 versus the same period in 1999.
In addition, the company recorded a restructuring charge of $12.8 million that relates to the disposition of its DC-9 fleet. The charge is comprised of $6.0 million to reduce the net value of the DC-9 surplus parts inventory to the estimated fair market value, and $6.8 million is to provide for the return of the leased DC-9 aircraft and other costs related to the restructuring of the fleet.
Operating Results - Third Quarter
While total available seat miles (ASMs) systemwide increased 15.3 percent as the company added capacity in scheduled and charter service during the third quarter of 2000, scheduled passenger load factor increased 1.1 points and revenue per ASM increased 9.3 percent to 9.0 cents. Total passengers increased 8.4 percent quarter over quarter and revenue passenger miles (RPMs) were up 16.1 percent.
Scheduled passenger revenues increased 22 percent to $136.7 million during the third quarter of 2000. Increases of $4.2 million and $19.3 million in the company's Interisland and Transpacific revenues, respectively, were driven by an 6 percent increase in passengers carried and a 5 percent increase in yield in Interisland operations, along with a 10 percent increase in passengers carried and a 15 percent increase in yield in the company's Transpacific operations.
Overseas charter revenues increased 88 percent to $20.5 million, due principally to the implementation of the company's contract with Renaissance Cruises to provide nonstop flights between Los Angeles and Tahiti.
Operating Results - Nine Months
For the first nine months of 2000, total revenues increased 26 percent to $460.5 million, from $366.5 million in the same period last year, a result of the company's success in achieving higher average load factor on increased capacity with improved yields. Operating income was $4.1 million compared to $12.1 million for the 1999 nine month period. The company recorded net income of $1.8 million or $0.04 per diluted share, compared to net income of $4.9 million or $0.12 per diluted share for the same period in 1999, as operating expenses grew faster than revenues during the period.
Hawaiian Airlines, Hawaii's first and largest airline, provides scheduled and charter air transportation of passengers, cargo and mail among the islands of Hawaii and between Hawaii and six West Coast gateway cities and two destinations in the South Pacific. Additional information about Hawaiian Airlines, including previously issued company news releases, may be accessed on the Internet at http://www.hawaiianair.com.
Except for historical information contained herein, the matters discussed in this news release contain forward-looking statements that involve risks and uncertainties. The company's actual results may differ materially from the results discussed in the forward-looking statements. Factors that might cause such a difference include, but are not limited to, the effect of changing economic conditions, trends in the airline industry, the ability to control costs and expenses, and other risks detailed in the company's continuing reports filed with the Securities and Exchange Commission.
To view a PDF of condensed balance sheets, click here.