- Net income of $30.7 million, or $0.58 per diluted share

HONOLULU, Oct. 20 /PRNewswire/ -- Hawaiian Holdings, Inc. (Nasdaq: HA) ("Holdings" or the "Company"), parent company of Hawaiian Airlines, Inc. ("Hawaiian"), today reported consolidated net income for the three months ended September 30, 2009 of $30.7 million, or $0.58 per diluted share, on total operating revenue of $305.6 million, including a one-time tax benefit of approximately $20 million. This result compares to net income of $6.0 million, or $0.12 per diluted share, on total operating revenue of $339.9 million for the three months ended September 30, 2008. The Company's operating income of $23.7 million for the three months ended September 30, 2009 compares to $27.3 million in the prior year period.

The results for the quarter ended September 30, 2009 benefited from the realization of one-time tax benefits in the Company's income tax provision. The Company estimates the benefit of the one-time adjustments to be approximately $20.0 million. Excluding these one-time adjustments, which were primarily a result of adopting various tax accounting changes, net income would have been $10.7 million, or $0.20 per diluted share. Table 2 sets forth a reconciliation of net income and diluted earnings per share on a GAAP basis and non-GAAP net income and diluted earnings per share excluding these one-time tax benefits.

"Our third quarter results were remarkably similar to our results last year though for entirely different reasons," commented Mark Dunkerley, the Company's president and chief executive officer. "This year, while weathering a substantial slow-down in demand we have at least benefited from lower fuel prices and we have posted comparable profits. As a result, Hawaiian has been able to continue to strengthen its balance sheet from operations in preparation for our coming fleet renewal program.

"Looking ahead to the fourth quarter, we continue to face better prospects than most of our competitors and we hope that the level of demand will strengthen more rapidly than the price of oil allowing us to remain profitable.

"As the company celebrates its 80th anniversary, we remain focused on keeping our attention rooted on the formula for success in the airline industry; delivering customer service excellence and controlling costs. In this endeavor, we are truly fortunate to work among outstanding colleagues in every branch of the organization," concluded Mr. Dunkerley.

Third Quarter Financial Results

The Company reported operating income of $23.7 million in the third quarter of 2009 compared to $27.3 million in the prior year period.

Third quarter 2009 operating revenue was $305.6 million, a 10.1% decrease compared to the third quarter of 2008. Capacity for the quarter increased 2.7% year-over-year to 2.5 billion available seat miles (ASMs), resulting in operating revenue per ASM (RASM) of 12.19 cents, down 12.4% from 13.92 cents in the third quarter a year ago. Third quarter passenger load factor increased to 84.9% from 80.3% in the same period a year ago. Passenger yield (passenger revenue per revenue passenger mile) decreased 20.7% to 12.65 cents from 15.95 cents in the third quarter of 2008. Selected Statistical Data is included in Table 3 below.

Total operating expenses for the third quarter of 2009 decreased 9.8% year-over-year to $281.9 million. This resulted in an operating cost per available seat mile (CASM) of 11.24 cents, down 12.3% versus the same period a year ago. Excluding fuel, third quarter CASM increased 14.5% to 8.51 cents versus 7.43 cents for the same period a year ago. A reconciliation of the GAAP and non-GAAP financial measures is included in Table 7.

Aircraft fuel costs decreased 47.9% year-over-year in the third quarter to $68.4 million and represented 24.3% of operating expenses. Hawaiian's average cost per gallon of jet fuel decreased 49.6% year-over-year in the third quarter to $1.93 (including taxes and delivery), while block hours increased 7.9%, primarily reflecting increased Boeing 717 operations. The financial impact of hedging activities is included in non-operating income/expenses, and as such is not reflected in fuel expense. Non-operating expenses reflect $3.3 million in net losses from Hawaiian's fuel hedging activity.

The Company believes that economic fuel expense is the best measure of the effect of fuel prices on its business as it most closely approximates the net cash outflow associated with the purchase of fuel for its operations in a period. The Company defines economic fuel expense as GAAP fuel expense plus (gains)/losses realized through actual cash (receipts)/payments received from or paid to hedge counterparties for fuel hedge derivative contracts settled during the period. For the three months ended September 30, 2009, economic fuel expense was $67.7 million ($1.91 per gallon), compared to $131.7 million ($3.84 per gallon) in the prior year period. An analysis of economic fuel expense for the three months ended September 30, 2009 and 2008 and a pro-forma net income and diluted net income per share reflecting economic fuel expense is included in Tables 4 and 5.

Hawaiian's year-over-year increase in Wages and Benefits of $6.8 million reflects increased pension and other benefits costs, with underlying wages growing at a rate generally in line with ASM growth. Maintenance Materials and Repairs increased $13.2 million compared to the third quarter of 2008 primarily as a result of higher engine overhaul and power-by-the-hour expenses and additional airframe and component repair costs. Commissions and Other Selling Expenses increased year-over-year by $4.7 million. During the prior year period, Commission and Other Selling expenses benefited from a reduction in the value of its frequent flyer liabilities as a result of certain changes in the program. During the three months ended September 30, 2009, the Company recorded a lesser benefit related to other program changes.

Third quarter 2009 non-operating expense totaled $6.8 million, compared with $12.7 million in the third quarter of 2008. The reduction in non-operating expenses is primarily attributable to a reduction in fuel hedge expenses. During the current year period the Company recognized non-operating expenses totaling $3.3 million related to fuel hedging activities compared to $9.2 million during the prior year period. During the third quarter of 2009, fuel hedging expenses include $0.7 million of realized gains on derivative contracts settling in the quarter, the reversal of $2.2 million of previously recorded gains on these same contracts, and $1.8 million in unrealized losses related to fuel derivative contracts settling in future periods.

Liquidity, Capital Resources and Fuel Hedging

    --  As of September 30, 2009 the Company had:
        --  Unrestricted cash, cash equivalents and short-term investments of
            $302.9 million, and $29.8 million in restricted cash.
        --  $83.5 million outstanding under two term loan facilities, $101.9
            million outstanding under floating rate notes issued in conjunction
            with the acquisition of three Boeing 767-300 ER aircraft in December
            2006, and additional notes payable of $28.6 million.
        --  $45.6 million of Capital Lease obligations primarily associated with
            four 717-200 aircraft.
    --  A summary of the Company's fuel derivatives contracts as of October 16,
        2009 is included as Table 6.
Company Highlights

    --  Hawaiian Airlines was ranked as the nation's #1 carrier for on-time
        performance as reported by the U.S. Department of Transportation's (DOT)
        Air Travel Consumer Report for the months of July and August.  Hawaiian
        has posted the nation's leading on-time performance numbers for every
        month in 2009.
    --  In celebration of its 80th anniversary of service, Hawaiian Airlines
        held a special homecoming ceremony in October to welcome back the actual
        airplane that started it all for the company 80 years ago - a 1929
        Bellanca CH-300 Pacemaker.
    --  In September, Hawaiian Airlines announced expanded service in summer
        2010 with the addition of three daily flights to Hawaii from California
        and debut of the A330 on its Los Angeles route.
    --  In September, Hawaiian Airlines announced that it would begin charging a
        $10 fee for the first checked bag on interisland flights.
    --  In September, Hawaiian Airlines expanded its code-sharing agreement with
        Korean Airlines, offering its customers nonstop service between Hawaii
        and Korea, as well as connecting service on flights within Korea and
        five other destinations in Asia.
    --  In August, Hawaiian Airlines announced that it had filled more than 100
        positions for aircraft mechanics, service representatives, contract
        agents, ramp agents, maintenance and cleaning personnel in recent
        months, and by early 2010, an additional 170 jobs will be added,
        including 25 new pilots and up to 30 flight attendants, to accommodate
        Hawaiian's expansion when the first A330 joins the fleet next April.
Investor Conference Call

Hawaiian Holdings' quarterly earnings conference call is scheduled to begin later today (Tuesday, October 20, 2009) at 4:30 p.m. Eastern Time (USA). The conference call will be broadcast live over the Internet. Investors may listen to the live audio webcast on the investor relations section of the Company's website at www.HawaiianAirlines.com. For those who are not available for the live webcast, the call will be archived for 90 days on Hawaiian's investor website.

About Hawaiian Airlines

Hawaiian is the nation's highest-ranked carrier for service quality and performance for 2008 in the 19th annual Airline Quality Rating study. Hawaiian has also led all U.S. carriers in on-time performance for each of the past five years (2004-2008) and has been an industry leader in fewest misplaced bags during that same period (#1 from 2005-2007, #2 in 2008) as reported by the U.S. Department of Transportation. Consumer surveys by Conde Nast Traveler, Travel + Leisure and Zagat have all ranked Hawaiian as the top domestic airline serving Hawaii.

Hawaiian will mark 80 years of continuous service in Hawaii on November 11, 2009. Hawaiian is the state's biggest and longest-serving airline, as well as the largest provider of passenger air service to Hawaii from the state's primary visitor markets on the U.S. mainland. Hawaiian offers nonstop service to Hawaii from more U.S. gateway cities (10) than any other airline, as well as service to the Philippines, Australia, American Samoa, and Tahiti. Hawaiian also provides more than 160 daily jet flights within the Hawaiian Islands.

Hawaiian Airlines, Inc. is a subsidiary of Hawaiian Holdings, Inc. (NASDAQ: HA). Additional information is available at HawaiianAirlines.com.

Forward Looking Statements

The foregoing information contains certain forward-looking statements that reflect the Company's current views with respect to certain current and future events and financial performance. These forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the Company's operations and business environment which may cause the Company's actual results to be materially different from any future results, expressed or implied, in these forward-looking statements. These risks and uncertainties include, without limitation, economic volatility, including a continued decline in the U.S. and global economies; the price and availability of aviation fuel; competition in the transpacific, interisland and South Pacific/Australia/Asia markets; the competitive advantages held by network carriers in the transpacific markets; reduced fares and the demand for transportation in the markets in which we operate; our dependence on tourist travel; the effects of seasonality and cyclicality; the concentration of our business in Hawaii, and between Hawaii and the western United States; our ability to implement our growth strategy and related cost reduction goals; fluctuations of our share price (including as a result of bankruptcies in the airline industry); our increasing dependence on technologies to operate our business; our fleet concentration in Boeing 767 aircraft and out-of-production Boeing 717 aircraft; our reliance on other companies for facilities and services; our dependence on satisfactory labor relations and our ability to negotiate amendments to labor agreements which are currently amendable; our ability to attract, motivate and retain key executives and other employees; our substantial debt; the effects of credit market conditions on our financial liquidity; our long-term commitments with aircraft and engine manufacturers and eventual financing arrangements and implementation risks; delays in scheduled aircraft deliveries or other loss of fleet capacity; our ability to comply with financial covenants under certain of our financing and credit card agreements; the impact of our substantial financial and operating leverage; our substantial funding obligations under our defined benefit pension plans; the potential impact of airline strategic combinations and consolidation within the airline industry; consumer perceptions of our services compared to other airlines; increased airport rent rates and landing fees at the airports within the State of Hawaii or elsewhere; new state laws and regulations imposed by the State of Hawaii on the airline industry; the effects of any hostilities or act of war (in the Middle East or elsewhere) or any terrorist attack; government legislation and regulation, including the Aviation and Transportation Security Act and other similar regulations; security-related costs and regulation; the cost and availability of insurance, including aircraft insurance; the impact of possible aircraft incidents; the impact of an outbreak of diseases; the impact of litigation, anticipated and unanticipated; and the impact of possible disruptions due to unpredictable weather and environmental concerns.

Any forward-looking statements in this release are based upon information available to the Company on the date of this release. The Company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any statements expressed or implied therein will not be realized. Additional information on risk factors that could potentially affect the Company's financial results may be found in the Company's filings with the Securities and Exchange Commission.

    Table 1.
    Hawaiian Holdings, Inc.
    Consolidated Statements of Operations
    (in thousands, except for per share data) (unaudited)
                                       Three Months Ended   Nine Months Ended
                                          September 30,       September 30,
                                          -------------       -------------
                                          2009      2008      2009      2008
                                          ----      ----      ----      ----
    Operating Revenue:
      Passenger                        $269,199  $312,028  $779,983  $837,554
      Cargo                              16,346    10,775    46,403    27,553
      Other                              20,082    17,115    59,868    45,222
                                         ------    ------    ------    ------
        Total                           305,627   339,918   886,254   910,329
                                        -------   -------   -------   -------
    Operating Expenses:
      Aircraft fuel, including taxes
       and oil                           68,427   131,233   173,287   345,646
      Wages and benefits                 68,399    61,646   202,636   183,905
      Aircraft rent                      25,603    24,041    77,837    71,176
      Maintenance materials and
       repairs                           37,111    23,950    94,091    83,285
      Aircraft and passenger servicing   15,340    13,859    44,570    41,845
      Commissions and other selling      15,112    10,394    48,827    46,710
      Depreciation and amortization      13,408    11,922    39,185    35,696
      Other rentals and landing fees     12,074    10,470    38,327    27,583
      Litigation settlement                   -         -         -   (52,500)
      Other                              26,427    25,094    76,119    73,211
                                         ------    ------    ------    ------
        Total                           281,901   312,609   794,879   856,557
                                        -------   -------   -------   -------
    Operating Income                     23,726    27,309    91,375    53,772
                                         ------    ------    ------    ------
    Nonoperating Income (Expense):
      Interest and amortization of
       debt discounts and issuance
       costs                             (5,140)   (4,777)  (15,160)  (15,257)
      Interest income                     1,203     1,913     3,666     5,773
      Gains (losses) on investments         555         -     2,226         -
      Gains (losses) on fuel
       derivatives                       (3,310)   (9,182)    1,813     5,269
      Other, net                            (64)     (668)      (14)     (532)
                                            ---      ----       ---      ----
        Total                            (6,756)  (12,714)   (7,469)   (4,747)
                                         ------   -------    ------    ------
    Income Before Income Taxes           16,970    14,595    83,906    49,025
      Income tax expense (benefit)      (13,700)    8,558     2,209     8,558
                                        -------     -----     -----     -----
    Net Income                          $30,670    $6,037   $81,697   $40,467
                                        =======    ======   =======   =======
    Net Income Per Common Stock Share:
      Basic                               $0.60     $0.13     $1.58     $0.85
                                          =====     =====     =====     =====
      Diluted                             $0.58     $0.12     $1.57     $0.81
                                          =====     =====     =====     =====
    Weighted Average Number of
    Common Stock Shares Outstanding:
      Basic                              51,437    47,828    51,595    47,571
                                         ======    ======    ======    ======
      Diluted                            52,764    52,078    52,195    49,883
                                         ======    ======    ======    ======
    Table 2.
    Hawaiian Holdings, Inc.
    Pro-forma Net Income and Diluted Net Income Per Share Excluding One-time
    Tax Benefits
    (in thousands, except for per share data)

                                     Three months ended  Nine months ended
                                     September 30, 2009  September 30, 2009
                                     ------------------  ------------------
                                              Diluted              Diluted
                                      Net     earnings     Net     earnings
                                     income   per share   income   per share
                                     ------   ---------   ------   ---------
                                    (in thousands, except for per share data)
    As reported - GAAP               $30,670      $0.58  $81,697      $1.57
    Less: Estimated one-time
     tax benefits                    (20,000)     (0.38) (15,000)     (0.29)
                                     -------      -----  -------      -----
    Excluding one-time tax benefit   $10,670      $0.20  $66,697      $1.28
                                     =======      =====  =======      =====
    Table 3.
    Hawaiian Holdings, Inc.
    Selected Statistical Data
                                        Three Months Ended September 30,
                                        --------------------------------
                                       2009           2008        Change
                                       ----           ----        ------
    Scheduled Operations*:
      Revenue passenger miles
       (RPM) (a)                   2,128.1        1,956.1            8.8%
      Available seat miles
       (ASM) (a)                   2,506.1        2,435.6            2.9%
      Passenger revenue per RPM      12.65 cents    15.95 cents    (20.7%)
      Passenger load factor
       (RPM/ASM)                     84.9%          80.3%            4.6 pt.
      Passenger revenue per ASM
       (PRASM)                       10.74 cents    12.81 cents    (16.2%)
    Total Operations:
      Revenue passenger miles
       (RPM) (a)                   2,128.7        1,959.3            8.6%
      Available seat miles
       (ASM) (a)                   2,507.3        2,441.4            2.7%
      Passenger load factor
       (RPM/ASM)                     84.9%          80.3%            4.6 pt.
      Operating Revenue per ASM
       (RASM)                        12.19 cents    13.92 cents    (12.4%)
      Operating Cost per ASM (CASM)  11.24 cents    12.81 cents    (12.3%)
      CASM - excluding litigation
       settlement                    11.24 cents    12.81 cents    (12.3%)
      CASM - excluding litigation
       settlement and aircraft fuel   8.51 cents     7.43 cents     14.5%


                                         Nine Months Ended September 30,
                                         -------------------------------
                                       2009           2008        Change
                                       ----           ----        ------
    Scheduled Operations*:
      Revenue passenger miles
       (RPM) (a)                   6,139.0        5,920.6            3.7%
      Available seat miles
       (ASM) (a)                   7,332.9        7,097.9            3.3%
      Passenger revenue per RPM      12.71 cents    14.15 cents    (10.2%)
      Passenger load factor
       (RPM/ASM)                     83.7%          83.4%            0.3 pt.
      Passenger revenue per ASM
       (PRASM)                       10.64 cents    11.80 cents     (9.8%)
    Total Operations:
      Revenue passenger miles
       (RPM) (a)                   6,140.5        5,932.6            3.5%
      Available seat miles
       (ASM) (a)                   7,335.0        7,114.2            3.1%
      Passenger load factor
       (RPM/ASM)                     83.7%          83.4%            0.3 pt.
      Operating Revenue per ASM
       (RASM)                        12.08 cents    12.80 cents     (5.6%)
      Operating Cost per ASM (CASM)  10.84 cents    12.04 cents    (10.0%)
      CASM - excluding litigation
       settlement                    10.84 cents    12.78 cents    (15.2%)
      CASM - excluding litigation
       settlement and aircraft fuel   8.48 cents     7.93 cents      6.9%

    (a) In millions.
    *Scheduled operations excludes charter operations.
    Table 4.
    Hawaiian Holdings, Inc.
    Economic Fuel Expense
    (in thousands, except per-gallon amounts)
                            Three Months Ended          Nine Months Ended
                               September 30,               September 30,
                            ------------------          -----------------
                           2009     2008   Change     2009    2008    Change
                           ----     ----   ------     ----    ----    ------
      Raw fuel expense  $68,427  $131,233  (47.9%) $173,287 $346,030   (49.9%)
      Realized (gains)
       losses on
       settlement of
       fuel derivative
       contracts           (682)      498     NM     10,494  (12,751)     NM
                           ----       ---     --     ------  -------      --
      Economic fuel
       expense          $67,745  $131,731  (48.6%) $183,781 $333,279   (44.9%)
      Fuel gallons
       consumed          35,434    34,280    3.4%   103,558  100,221     3.3%
                         ------    ------    ---    -------  -------     ---
      Economic fuel
       cost per gallon    $1.91     $3.84  (50.2%)    $1.77    $3.33   (46.7%)
                          =====     =====  =====      =====    =====   =====
Our pro forma net income and diluted net income per share reflecting economic fuel expense for the three months ended September 30, 2009 and 2008 are as follows:

    Table 5.
    Hawaiian Holdings, Inc.
    Pro-forma Net Income and Diluted Net Income Per Share Reflecting Economic
    Fuel Expense
    (in thousands, except per-share data)
                                      Three months ended September 30,
                                      --------------------------------
                                         2009                   2008
                                         ----                   ----
                                              Diluted                Diluted
                                              earnings               earnings
                                 Net income  per share  Net income  per share
                                 ----------  ---------  ----------  ---------
    As reported - GAAP              $30,670      $0.58      $6,037      $0.12
    Less: mark-to-fair value
     gains(losses) on
     undesignated fuel contracts     (3,992)     (0.08)     (8,684)     (0.17)
                                     ------      -----      ------      -----
    Reflecting economic fuel
     expense                        $34,662      $0.66     $14,721      $0.29
                                    =======      =====     =======      =====

                                       Nine months ended September 30,
                                       -------------------------------
                                         2009                   2008
                                         ----                   ----
                                              Diluted                Diluted
                                              earnings               earnings
                                 Net income  per share  Net income  per share
                                 ----------  ---------  ----------  ---------
    As reported - GAAP              $81,697      $1.57     $40,467      $0.81
    Less: mark-to-fair value
     gains (losses) on
     undesignated fuel contracts     12,307       0.24      (7,098)     (0.14)
                                     ------       ----      ------      -----
    Reflecting economic fuel
     expense                        $69,390      $1.33     $47,565      $0.95
                                    =======      =====     =======      =====
    Table 6.
    Hawaiian Holdings, Inc.
    Fuel Derivative Contract Summary
    As of October 16, 2009
                              Weighted
                              Average                             Percentage
                              Ceiling     Ceiling                     of
                               Price       Price       Gallons     Quarter's
                              (per         Range        Hedged    Consumption
                              gallon)   (Per Gallon)  (Thousands)    Hedged
                             ---------  ------------  ----------- ------------
    Fourth Quarter 2009
    -------------------
              Crude Oil        $1.69   $1.97 - $1.20     16,968        54%
    First Quarter 2010
    -------------------
              Crude Oil        $1.83   $2.04 - $1.60     12,222        39%
    Second Quarter 2010
    -------------------
              Crude Oil        $1.95   $2.11 - $1.73      7,392        23%
    Third Quarter 2010
    -------------------
              Crude Oil        $2.01   $2.13 - $1.92      2,394         8%

                                                                  Percentage
                             Weighted      Floor                      of
                             Average       Price       Gallons     Quarter's
                              Floor        Range        Hedged    Consumption
                              Price     (Per Gallon)  (Thousands)    Hedged
                             ---------  ------------  ----------- ------------
    Fourth Quarter 2009
    -------------------
              Crude Oil        $1.08   $1.51 - $0.92      7,644        24%
    First Quarter 2010
    -------------------
              Crude Oil        $1.21   $1.53 - $0.96      4,410        14%
    Second Quarter 2010
    -------------------
              Crude Oil        $1.48   $1.54 - $1.42      1,134         4%
    Third Quarter 2010
    -------------------
              Crude Oil        $1.54   $1.55 - $1.53        504         2%
    Table 7.
    Hawaiian Holdings, Inc.
    Reconciliation of Non-GAAP Financial Measures
    (in millions, except for CASM data) (unaudited)

                        Three Months Ended          Nine Months Ended
                           September 30,               September 30,
                        2009           2008         2009          2008
                        ----           ----         ----          ----
    GAAP operating
     expenses          $281.9        $312.6        $794.9        $856.6
      Litigation
       settlement           -             -             -         (52.5)
                          ---           ---           ---         -----
    Operating
     expenses, less
     litigation
     settlement         281.9         312.6         794.9         909.1
      Aircraft fuel,
       including taxes
       and oil           68.4         131.2         173.3         345.6
                         ----         -----         -----         -----
    Operating
     expenses, less
     litigation
     settlement and
     aircraft fuel     $213.5        $181.4        $621.6        $563.5
                       ======        ======        ======        ======

    Available Seat
     Miles            2,507.3       2,441.4       7,335.0       7,114.2
    CASM - GAAP         11.24 cents   12.81 cents   10.84 cents   12.04 cents
        Add back:
         Litigation
         settlement         -             -             -         (0.74)
                          ---           ---           ---         -----
    CASM - excluding
     litigation
     settlement         11.24 cents   12.81 cents   10.84 cents   12.78 cents
         Less:
          aircraft
          fuel           2.73          5.38         2.36          4.85
                         ----          ----         ----          ----
    CASM - excluding
     litigation
     settlement and
     aircraft fuel       8.51 cents    7.43 cents    8.48 cents    7.93 cents
                         ====          ====          ====          ====
SOURCE Hawaiian Airlines, Inc.

Peter Ingram, CFO, +1-808-835-3030, peter.ingram@hawaiianair.com, or Investor Relations, Matt Bernier, Sr. Director, +1-808-838-5508, matt.bernier@hawaiianair.com, or Media, Alan L. Hoffman, Sr. VP, +1-808-838-6758, al.hoffman@hawaiianair.com, all of Hawaiian Airlines