Revenues Rise But Fuel, Labor Costs Rise More
HONOLULU -- The one-two punch of soaring fuel prices and higher labor costs resulted in a $3 million operating loss on revenue of $58.6 million for Hawaiian Airlines in November, making it the third straight month the company has finished in the red.
“The fact that Hawaiian has now had three consecutive months of operating losses after recording 17 straight months of operating profits shows just how much the industry is changing and how we need to adjust accordingly,” said Joshua Gotbaum, Hawaiian's Trustee. “Our task is to continue providing some of the best service in the nation, while keeping our costs in line with our competition. I'm confident that the people of Hawaiian Airlines can and will rise to both challenges.”
Last year, Hawaiian enjoyed its best November ever, generating $4.2 million in operating income on revenue of $56.5 million, meaning the company experienced a $7.2 million downturn in year-over-year profitability this November, despite increasing revenue by more than $2 million.
Fuel costs were up 72 percent over last year as price increases during November added nearly $6 million in expense compared to November 2003. Labor costs also jumped by 23 percent to $20.8 million, an increase of nearly $4 million over November 2003.
Hawaiian partially offset its higher expenses by filling its aircraft at an impressive rate. Its average load factor of 87.4 percent was 2.8 percentage points higher than 2003's record-setting November even though capacity, as measured by Available Seat Miles (ASMs), was up by 3.2 percentage points.
Revenue Per Available Seat Mile (RASM) remained essentially flat during November, while Cost Per Available Seat Mile (CASM) increased by 14.1 percent. Excluding fuel expenses, CASM increased year-over-year by 4.4 percent.
Hawaiian recorded a net loss of $2.9 million for November.
The complete financial report for November is available online at HawaiianAirlines.com.
About Hawaiian Airlines
Hawaiian Airlines, the nation's number one on-time carrier, is recognized as one of the best airlines in America. Readers of two prominent national travel magazines, Condé Nast Traveler and Travel + Leisure, have both rated Hawaiian as the top domestic airline serving Hawaii in their most recent rankings, and the fifth best domestic airline overall.
Celebrating its 75th year of continuous service, Hawaiian is Hawaii's biggest and longest-serving airline, and the second largest provider of passenger air service between Hawaii and the U.S. mainland. Hawaiian offers nonstop service to Hawaii from more U.S. gateway cities than any other airline. Hawaiian also provides approximately 100 daily jet flights among the Hawaiian Islands, as well as service to Australia, 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 in May 2003, Hawaiian Holdings has had no responsibility for the management of Hawaiian Airlines and has had limited access to information concerning the airline. Additional information is available at www.HawaiianAir.com.