Hawaiian Airlines Made $133 Million Operating Turnaround in 2003

Nation's Third Most Profitable Airline

HONOLULU, March 25, 2004 -- Hawaiian Airlines, Inc. today announced its final financial results for the fiscal year ended December 31, 2003, showing that the company reported an operating profit of $77.5 million (including a $17.5 million security fee reimbursement from the federal government) on revenue of $706.1 million, compared to an operating loss of $55.2 million on revenue of $632.0 million for 2002.

The results reflect an operating profit turnaround of $132.7 million and Hawaiian's most profitable annual operating result ever. To view a PDF of the income statement, click here.

Said Joshua Gotbaum, Hawaiian's trustee, “It was an amazing year. Hawaiian's management and employees have done a spectacular job. Building on a new fleet, they have reformed almost every part of Hawaiian's operations. Hawaiian, always known for excellent service, is now also the nation's most punctual airline as well as one of the most profitable.

“Even so,” Gotbaum said, “we're not resting on our laurels. Airline competition is fierce, and every year is a new chance to remind travelers about Hawaiian's unique combination of service and value.”

The operational success of 2003 meant Hawaiian finished the year as the third most profitable airline in the nation, which, as Gotbaum says, “is an incredible story all by itself.”

Many positive changes contributed to Hawaiian's improvement in 2003. Passenger revenue increased by $85 million, cargo revenue by $7 million. The newly acquired fleet produced savings of $41 million in aircraft maintenance, while increased use of Hawaiian's web site and direct booking saved some $10 million in distribution costs.

These offset increases of $28 million in aircraft rent and $10 million in wages and benefits, as well as a $23 million decline in charter revenue from reduced charter service compared to the year prior.

Under generally accepted accounting principles, reorganization-related expenses are reported as a non-operating expense. In 2003, Hawaiian had $115.1 million in net reorganization expenses; of this amount approximately $102 million represents non-cash charges, consisting of bankruptcy-related claims and asset write-offs. When these and other non-operating charges (e.g., interest expense, taxes) are taken into account, the company reported a net loss of $49.5 million for 2003 (versus a net loss of $57.4 million in 2002).

A full set of audited financial statements will be posted at Hawaiian Airlines' web site, HawaiianAir.com, when they become available.

(Operating profit excludes bankruptcy-related and other non-operating charges, interest, and taxes. Airlines are frequently compared on the basis of operating profit margins.)

Operational Improvements
The year was marked by several accomplishments that contributed to Hawaiian's financial success, including the full conversion to a new fleet of transpacific aircraft with the retiring of the last DC-10 jet in February 2003.

In addition, the company revamped its web site, HawaiianAir.com, which generated a steady increase in web sales activities throughout the year as customers responded to the special fares and travel deals offered online.

Hawaiian also introduced several technology-based initiatives that improved its operational efficiency including a full conversion to e-ticketing, the installment of Self Check-In Hele On (Hurry Up) terminals at all Hawaii airports to speed transits, and the introduction of Web Check-In Hele On at HawaiianAir.com allowing customers to check in from home or the office up to 24 hours before departure.

This helped contribute to Hawaiian's operational success for the year, which was reflected in the airline finishing 2003 as the nation's number one on-time carrier for November and December – which were the first two months the company submitted traffic statistics – according to monthly reports filed by the U.S. Department of Transportation.

About Hawaiian Airlines
Hawaiian Airlines, the nation's number one on-time carrier, is recognized as one of the best airlines in America. Business travelers recently surveyed byCondé Nast Traveler rated Hawaiian Airlines as having the best in-flight service and meals of any U.S. carrier. Hawaiian was recently ranked fourth best in the nation overall by Travel + Leisure.

Celebrating its 75th year of continuous service, Hawaiian Airlines is Hawaii's largest and longest-serving airline, and the second largest provider of passenger air service between Hawaii and the mainland U.S. Hawaiian offers nonstop service to Hawaii from more mainland U.S. gateways
than any other airline. Hawaiian also provides approximately 100 daily jet flights among the Hawaiian Islands, as well as service to American Samoa and Tahiti.

Hawaiian Airlines, Inc. is a subsidiary of Hawaiian Holdings, Inc. (AMEX and PCX: HA). Since the appointment of a bankruptcy trustee on May 16, 2003, Hawaiian Holdings has had no involvement in the management of Hawaiian Airlines and has had limited access to information concerning the airline.

Additional information on Hawaiian Airlines is available at www.HawaiianAir.com