JetBlue Announces 2012 Annual Profit
JetBlue Reports Record Fourth Quarter and Full Year Revenues
NEW YORK, Jan. 29, 2013
NEW YORK, Jan. 29, 2013 /PRNewswire/ --JetBlue Airways Corporation (NASDAQ:
JBLU) today reported its results for the fourth quarter and full year 2012:
oOperating income of $44 million in the fourth quarter. This compares to
operating income of $83 million in the year-ago period. For the full year
2012, JetBlue reported operating income of $376 million. This compares to
operating income of $322 million for the full year 2011.
oPre-tax income of $1 million in the fourth quarter. This compares to
pre-tax income of $40 million in the year-ago period. For the full year
2012, JetBlue reported pre-tax income of $209 million. This compares to a
pre-tax income of $145 million for the full year 2011.
oNet income for the fourth quarter was $1 million, or $0.00 per diluted
share. This compares to JetBlue's fourth quarter 2011 net income of $23
million, or $0.08 per diluted share. For the full year 2012, JetBlue
reported net income of $128 million, or $0.40 per diluted share. This
compares to net income of $86 million, or $0.28 per diluted share.
"Although Hurricane Sandy negatively impacted fourth quarter results, 2012 was
a very good year for JetBlue," said Dave Barger, JetBlue's President and Chief
Executive Officer. "We further solidified our position as New York's Hometown
Airline^™ while continuing to pursue profitable growth opportunities in Boston
and the Caribbean & Latin America, resulting in record revenue performance.
These results reflect the hard work and dedication of our 14,000 crewmembers
who deliver exceptional service to our customers every day."
JetBlue reported record fourth quarter operating revenues of $1.2 billion
despite Hurricane Sandy, which reduced revenue by an estimated $45 million.
Revenue passenger miles for the fourth quarter increased 4.3% to 8.1 billion
on a capacity increase of 4.8%, resulting in a fourth quarter load factor of
81.9%, a decrease of 0.3 points year over year.
Yield per passenger mile in the fourth quarter was 13.47 cents, up 0.2%
compared to the fourth quarter of 2011. Passenger revenue per available seat
mile (PRASM) for the fourth quarter 2012 decreased 0.2% year over year to
11.03 cents and operating revenue per available seat mile (RASM) decreased
0.5% year over year to 12.09 cents.
"While we saw a significant decline in demand for air travel following
Hurricane Sandy, we are encouraged by more robust demand trends during the
December holiday travel period," said Robin Hayes, JetBlue's Chief Commercial
Officer. "We continue to be pleased with the strong performance of our Boston
business-oriented markets – an area of significant focus for JetBlue."
Operating expenses for the quarter increased 8.3%, or $87 million, over the
prior year period. JetBlue's operating expense per available seat mile (CASM)
for the fourth quarter increased 3.3% year over year to 11.65 cents.
Excluding fuel, CASM increased 4.8% to 7.17 cents.
Over the course of 2012, JetBlue improved its return on invested capital
(ROIC) by approximately one percentage point to 4.8%. "We improved ROIC
through a combination of margin expansion and prudent balance sheet
management," said Mark Powers, JetBlue's Chief Financial Officer.
"Nonetheless, we recognize there is still significant work to be done to
continue improving shareholder returns.We remain committed to improving ROIC
and believe we are on track to do so in 2013."
Fuel Expense and Hedging
JetBlue continued to hedge fuel to manage price volatility. Specifically,
during the fourth quarter JetBlue hedged approximately 27% of its fuel
consumption and managed approximately 20% of its fuel consumption using fixed
forward price agreements (FFPs), resulting in a realized fuel price of $3.20
per gallon, a 1% increase over fourth quarter 2011 realized fuel price of
JetBlue has managed approximately 18% of its first quarter projected fuel
requirements using a combination of FFPs and collars. Based on the fuel curve
as of January 25th, JetBlue expects an average price per gallon of fuel,
including the impact of hedges, FFPs and fuel taxes, of $3.23 in the first
Balance Sheet Update
JetBlue ended the fourth quarter with approximately $731 million in
unrestricted cash and short term investments. During the quarter, JetBlue
increased its line of credit with Morgan Stanley to $200 million. In
addition, JetBlue maintains a $125 million corporate purchasing line with
American Express for jet fuel purchases.
During the fourth quarter, JetBlue prepaid approximately $50 million of debt.
JetBlue recorded a $3 million loss in non-operating income during the quarter
in connection with this prepayment. In addition, JetBlue prepaid $200 million
related to 2013 aircraft deliveries and pre-delivery deposits for future
aircraft deliveries in exchange for favorable pricing terms.
Since December 31, 2011, JetBlue has increased the number of unencumbered
Airbus A320 aircraft from one to 11 and decreased its total debt balance by
approximately $285 million. "We continue to actively manage our total debt
balance and seek to optimize the liquidity on our balance sheet, which we
believe will help improve ROIC," said Mr. Powers.
First Quarter and Full Year Outlook
For the first quarter of 2013, CASM is expected to increase between 1.0% and
3.0% over the year-ago period. Excluding fuel and profit sharing, CASM in the
first quarter is expected to increase between 2.0% and 4.0% year over year.
CASM for the full year is expected to increase between 1.5% and 3.5% over full
year 2012. Excluding fuel and profit sharing, CASM in 2013 is expected to
increase between 1.0% and 3.0% year over year.
Capacity is expected to increase between 5.5% and 7.5% in the first quarter
and for the full year.
JetBlue will conduct a conference call to discuss its quarterly earnings
today, January 29, at 10:00 a.m. Eastern Time. A live broadcast of the
conference call will be available via the internet at
JetBlue is New York's Hometown Airline ™ with other focus cities in Boston,
Fort Lauderdale, Los Angeles, San Juan, and Orlando. Known for its
award-winning service and free TV as much as its low fares, JetBlue offers the
most legroom in coach of any U.S. airline (based on average fleet-wide seat
pitch) as well as super-spacious Even More Space seats. JetBlue is also
America's first and only airline to offer its own Customer Bill of Rights,
with meaningful and specific compensation for customers inconvenienced by
service disruptions within JetBlue's control. Visit www.jetblue.com/promise
for details. JetBlue serves 75 cities with 750 daily flights and plans to
launch service to Charleston, South Carolina, Albuquerque, New Mexico, and
Philadelphia, Pennsylvania, in 2013, as well as Medellín, Colombia, subject to
receipt of government approval. With JetBlue, all seats are assigned, all
fares are one-way, and an overnight stay is never required. For information or
reservations call 1-800-JETBLUE (1-800-538-2583), TTY/TDD 1-800-336-5530, or
Forward Looking Statements
This press release contains statements of a forward-looking nature which
represent our management's beliefs and assumptions concerning future events.
When used in this document and in documents incorporated herein by reference,
the words "expects," "plans," "anticipates," "indicates," "believes,"
"forecast," "guidance," "outlook," "may," "will," "should," "seeks," "targets"
and similar expressions are intended to identify forward-looking statements.
Forward-looking statements involve risks, uncertainties and assumptions, and
are based on information currently available to us. Actual results may differ
materially from those expressed in the forward-looking statements due to many
factors, including, without limitation, our extremely competitive industry;
volatility in financial and credit markets which could affect our ability to
obtain debt and/or lease financing or to raise funds through debt or equity
issuances; increases in fuel prices, maintenance costs and interest rates; our
ability to implement our growth strategy, including the ability to operate
reliably the EMBRAER 190 aircraft and our new terminal at JFK; our significant
fixed obligations; our ability to attract and retain qualified personnel and
maintain our culture as we grow; our reliance on high daily aircraft
utilization; our dependence on the New York metropolitan market and the effect
of increased congestion in this market; our reliance on automated systems and
technology; our being subject to potential unionization; our reliance on a
limited number of suppliers; changes in or additional government regulation;
changes in our industry due to other airlines' financial condition; a
continuance of the economic recessionary conditions in the U.S. or a further
economic downturn leading to a continuing or accelerated decrease in demand
for domestic and business air travel; and external geopolitical events and
conditions. Further information concerning these and other factors is
contained in the Company's Securities and Exchange Commission filings,
including but not limited to, the Company's 2011 Annual Report on Form 10-K
and Quarterly Reports on Form 10-Q. We undertake no obligation to update any
forward-looking statements to reflect events or circumstances that may arise
after the date of this release.
Regulation G Reconciliations
Consolidated operating cost per available seat mile, excluding fuel and profit
sharing (CASM Ex-Fuel and Profit Sharing) and return on invested capital
(ROIC) are non-GAAP financial measures that we use as measures of our
CASM is a common metric used in the airline industry. We exclude aircraft
fuel and related taxes and profit sharing from operating cost per available
seat mile to determine CASM Ex-Fuel and Profit Sharing. We believe that CASM
Ex-Fuel and Profit Sharing provides investors the ability to measure financial
performance excluding items beyond our control, such as (i) fuel costs, which
are subject to many economic and political factors beyond our control, and
(ii) profit sharing, which is sensitive to volatility in earnings. We believe
this measure is more indicative of our ability to manage costs and is more
comparable to measures reported by other major airlines. We are unable to
reconcile projected CASM Ex-Fuel and Profit Sharing as the nature or amount of
excluded items are only estimated at this time.
ROIC is a non-GAAP financial measure that we believe provides useful
supplemental information for management and investors by measuring the
effectiveness of our operations' use of invested capital to generate profits.
We use ROIC to track how much value we are creating for our shareholders as it
represents an important financial metric that we believe provides meaningful
information as to how well we generate cash flow relative to the capital
invested in our business.
We believe these non-GAAP measures provide a more meaningful comparison of our
results to others in the airline industry and our prior year results.
Investors should consider these non-GAAP financial measures in addition to,
and not as a substitute for, our financial performance measures prepared in
accordance with GAAP. It should be noted as well that our non-GAAP
information may be different from the non-GAAP information provided by other
See "Non GAAP Financial Measures" appearing in the tables following this press
release for reconciliation of these non-GAAP measures to their nearest
comparable GAAP measure.
JETBLUE AIRWAYS CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except share and per share amounts)
Three Months Twelve Months
December 31, Percent December 31, Percent
2012 2011 Change 2012 2011 Change
Passenger $ $ 4.6 $ $ 11.5
1,089 1,041 4,550 4,080
Other 105 105 0.7 432 424 2.0
operating 1,194 1,146 4.2 4,982 4,504 10.6
fuel and 442 418 5.9 1,806 1,664 8.6
wages and 262 241 8.6 1,044 947 10.3
and other 66 60 9.9 277 245 12.8
and 68 62 9.3 258 233 10.5
Aircraft 32 33 (5.0) 130 135 (3.6)
Sales and 52 54 (1.0) 204 199 3.0
materials 80 62 27.3 338 227 48.4
operating 148 133 11.8 549 532 3.2
operating 1,150 1,063 8.3 4,606 4,182 10.1
OPERATING 44 83 (47.5) 376 322 16.6
Operating 3.7 % 7.3 % (3.6) pts. 7.5 % 7.1 % 0.4 pts.
Interest (43) (46) (7.8) (176) (179) (2.0)
Capitalized 2 2 13.1 8 5 41.3
income and (2) 1 (261.6) 1 (3) (128.8)
other (43) (43) 0.1 (167) (177) (5.5)
INCOME BEFORE 1 40 209 145
Pre-tax 0.1 % 3.5 % (3.4) pts. 4.2 % 3.2 % 1.0 pts.
Income tax - 17 81 59
NET INCOME $ $ $ $
1 23 128 86
Basic $ $ $ $
- 0.08 0.45 0.31
Diluted $ $ $ $
- 0.08 0.40 0.28
Basic 282,677 279,904 282,317 278,689
Diluted 284,521 342,870 344,129 346,467
JETBLUE AIRWAYS CORPORATION
COMPARATIVE OPERATING STATISTICS
Three Months Ended Twelve Months
December 31, Percent December 31, Percent
2012 2011 Change 2012 2011 Change
passengers 7,018 6,693 4.9 28,956 26,370 9.8
passenger miles 8,083 7,750 4.3 33,563 30,698 9.3
miles (ASMs) 9,874 9,425 4.8 40,075 37,232 7.6
Load factor 81.9 % 82.2 % (0.3) pts. 83.8 % 82.4 % 1.4 pts.
utilization 11.3 11.5 (1.0) 11.8 11.7 1.1
(hours per day)
$ $ $ $
Average fare (0.3) 1.5
155.17 155.60 157.11 154.74
passenger mile 13.47 13.44 0.2 13.55 13.29 2.0
revenue per ASM 11.03 11.05 (0.2) 11.35 10.96 3.6
revenue per ASM 12.09 12.16 (0.5) 12.43 12.10 2.8
expense per ASM 11.65 11.27 3.3 11.49 11.23 2.3
expense per ASM, 7.17 6.85 4.8 6.99 6.76 3.3
expense per ASM,
excluding fuel 7.26 6.85 6.0 6.98 6.76 3.2
operating 11.91 11.10 7.3 11.34 11.06 2.5
expense per ASM
Departures 65,062 62,009 4.9 264,600 243,446 8.7
Average stage 1,089 1,090 (0.1) 1,085 1,091 (0.5)
of operating 177.8 167.9 5.9 173.9 164.9 5.4
$ $ $ $
Average fuel 1.3 1.2
cost per gallon 3.20 3.15 3.17
consumed 138 133 4.5 563 525 7.3
equivalent 12,070 11,733 2.9
period end (a)
(a) Excludes operating expenses and employees of LiveTV,
LLC, which are unrelated to our airline operations.
SELECTED CONSOLIDATED BALANCE SHEET DATA
Cash and cash $ $
investment 685 591
Total assets 7,070 7,071
Total debt 2,851 3,136
Stockholders' 1,888 1,757
SOURCE: JetBlue Airways
NON-GAAP FINANCIAL MEASURES (c)
(dollars in millions, per ASM data in
Reconciliation of Operating expense per ASM, excluding fuel and profit
Three Months Ended
$ per ASM $ per ASM
Total operating expenses $ 11.65 $ 11.27
Less: Aircraft fuel and 442 4.48 418 4.42
Operating expenses, excluding 708 7.17 645 6.85
Less: Profit sharing (8) (0.09) - -
Operating expense, excluding $ 7.26 $ 6.85
fuel & profit sharing 716 645
Twelve Months Ended
$ per ASM $ per ASM
Total operating expenses $ 11.49 $ 11.23
Less: Aircraft fuel and 1,806 4.50 1,664 4.47
Operating expenses, excluding 2,800 6.99 2,518 6.76
Less: Profit sharing 3 0.01 - -
Operating expense, excluding $ 6.98 $ 6.76
fuel & profit sharing 2,797 2,518
Reconciliation of Return on Invested Capital
Twelve Months Ended
Operating Income $ 376 $
Add: Interest income and 1 (3)
Add: Interest component
of capitalized aircraft rent 68 71
Subtotal 445 390
Less: Income tax expense 172 153
Operating Income After Tax, 273 237
Average Stockholders' equity 1,822 1,705
Average total debt 2,994 3,085
Capitalized aircraft rent (b) 913 947
Invested Capital 5,729 5,737
Return on Invested Capital 4.8% 4.1%
(b) Capitalized Aircraft Rent
Aircraft rent, as reported 130 135
Capitalized aircraft rent (7 913 947
* Aircraft rent)
Interest component of capitalized
aircraft rent (Imputed interest at 68 71
(c) Refer to our "Regulation G Reconciliations" note at the end of our
Earnings Release for more information on these non-GAAP measures
SOURCE JetBlue Airways Corporation
Contact: Investor Relations, +1-718-709-2202, firstname.lastname@example.org; Corporate
Communications, +1-718-709-3089, CorporateCommunications@jetblue.com
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