SkyWest, Inc. Announces First Quarter 2013 Results

              SkyWest, Inc. Announces First Quarter 2013 Results

PR Newswire

ST. GEORGE, Utah, May 8, 2013

ST. GEORGE, Utah, May 8, 2013 /PRNewswire/ --SkyWest, Inc. ("SkyWest")
(NASDAQ: SKYW) today reported net income of $3.2 million, or $0.06 per
diluted share, for the quarter ended March 31, 2013, compared to a net loss of
$(0.7) million, or $(0.01) per diluted share, for the same period last year.

Quarter Highlights

SkyWest's financial results for the quarter ended March 31, 2013 were slightly
improved compared to the financial results for the quarter ended March 31,
2012. SkyWest generated a 2.8 percent increase in block hours which resulted
in additional revenues of approximately $10.5 million; however, overall
revenues decreased by a total of $117.7 million as a result of lower
reimbursement payments of $99.7 million for fuel and $19.7 million for engine
overhaul expenses, under its contracts with SkyWest's major partners. The
majority of fuel is now purchased directly by SkyWest's major partners and as
a result, SkyWest reports lower operating revenues and expenses. SkyWest's
financial results were also negatively impacted during the quarter ended March
31, 2013 by severe weather which resulted in approximately 1,900 cancelled
flights and 4,500 fewer block hours at an estimated impact of $4.5 million
(pretax).

Following are some selected highlights for the quarter ended March 31, 2013
compared to the same period last year:

(Unaudited)                      Three Months Ended

Dollars in thousands, except per  March 31,
share amounts
                                  2013           2012            % Change
Total operating revenue           $   803.5   $    921.2   (12.8)%
Total operating margin            1.9%           2.2%             (0.3)pts
Pretax income (loss)              $     5.4 $     (1.2) NM
Net income (loss)                 $     3.2 $     (0.7) NM
Fully diluted earnings per share  $    0.06  $    (0.01)  NM
Block hours                       571,991        556,421         2.8%

Commenting on the results, Jerry C. Atkin, SkyWest's Chairman and CEO, said
"We had planned to achieve improved financial results for the quarter just
ended over the same period last year, however our results were negatively
impacted primarily by weather and other operational challenges," He
continued, "In spite of the challenges experienced during the quarter, we
remain optimistic on our profit improvement objectives as well as improved
operating results."

Financial and Operating Results

Operating revenues totaled $803.5 million for the quarter ended March 31,
2013, compared to $921.2 million for the same period last year or a decrease
of $117.7 million, or 12.8%. The decrease was due primarily to the reduction
of $128.2 million of fuel and certain engine overhaul amounts which are
directly reimbursed by major partners and recorded as operating revenues.
Total block hours for the quarter ended March 31, 2013 were 571,991, or an
increase of 2.8 percent, compared to 556,421 for the same period last year,
which generated approximately $10.5 million in additional revenues. 

Total airline expenses (consisting of total operating and interest expenses)
decreased $114.6 million, or 12.5%, during the quarter ended March 31, 2013,
compared to the same period in 2012. However, after excluding pass-through
costs for fuel and certain engine overhaul expenses, total airline expenses
increased $4.8 million or less than 1%.

Under United Express agreements for SkyWest Airlines, Inc. ("SkyWest
Airlines") and ExpressJet Airlines, Inc. ("ExpressJet Airlines"), SkyWest
recognizes revenue at fixed hourly rates for mature engine maintenance on
regional jet engines and SkyWest recognizes engine maintenance expense on its
CRJ200 regional jet engines on an as-incurred basis as maintenance expense.
During the quarter ended March 31, 2013, CRJ200 engine expense under these
agreements decreased $7.6 million to $10.0 million compared to $17.6 million
for the quarter ended March 31, 2012, as a result of decreased engine overhaul
expense due to the timing of scheduled engine maintenance events. SkyWest was
reimbursed approximately $11.4 million and $9.4 million for engine overhaul
expense, under its United Express agreements, in each of the periods ended
March 31, 2013 and 2012, respectively. 

Liquidity

At March 31, 2013, SkyWest had $631.5 million in cash and marketable
securities, compared to $709.4 million as of December 31, 2012. The decrease
in cash and marketable securities of $77.9 million was primarily the result of
the payment of scheduled semi-annual lease and debt payments. SkyWest's
long-term debt was $1.44 billion as of March 31, 2012, compared to $1.47
billion as of December 31, 2012. The decrease in long-term debt was due
primarily to SkyWest's payment of normal recurring debt obligations. SkyWest
has significant long-term lease obligations that are recorded as operating
leases and are not reflected as liabilities on SkyWest's consolidated balance
sheets. At a 4.7% discount rate, the present value of these lease obligations
was approximately $1.7 billion as of March 31, 2013.

Recent Business Developments

On August 2, 2012, SkyWest announced the award of 34 additional dual-class
aircraft and the removal of 66 CRJ200 aircraft with Delta Airlines, Inc.
("Delta") and has taken delivery of 33 of these dual-class aircraft. SkyWest
anticipates removal of the 66 CRJ200 aircraft starting in October of 2013.

On September 11, 2012, SkyWest announced the signing of an agreement with
American Airlines, Inc. ("American Airlines") to operate 23 CRJ200 regional
jet aircraft as American Eagle and had integrated 12 of these aircraft into
operations by December 31, 2012. The remaining 11 aircraft were introduced
into service February 14, 2013.

On July 11, 2012, SkyWest announced the execution of an Aircraft Purchase
Agreement with Mitsubishi Aircraft Corporation covering the purchase of 100
Mitsubishi regional jet aircraft. Deliveries are currently expected to begin
in 2016.

SkyWest has increased its total fleet to 752 aircraft as of March 31, 2012,
compared to 727 aircraft as of March 31, 2012.

About SkyWest

SkyWest is the holding company for two scheduled passenger airline operations
and an aircraft leasing company and is headquartered in St. George, Utah.
SkyWest's scheduled passenger airline operations consist of SkyWest Airlines
also based in St. George, Utah and ExpressJet Airlines based in Atlanta,
Georgia. SkyWest Airlines operates as United Express, Delta Connection and
American Eagle carriers under contractual agreements with United, Delta and
American Airlines. SkyWest Airlines also operates as US Airways Express under
a contractual agreement with US Airways, Inc., and operates flights for Alaska
Airlines under a contractual agreement. ExpressJet Airlines operates as
United Express, Delta Connection, and American Eagle carriers under
contractual agreements with United, Delta and American. System-wide, SkyWest
serves markets in the United States, Canada, Mexico and the Caribbean with
approximately 3,900 daily departures and a fleet of approximately 750 regional
aircraft. This press release and additional information regarding SkyWest can
be accessed at www.skywest.com.

FORWARD-LOOKING STATEMENTS

In addition to historical information, this release contains forward-looking
statements. SkyWest may, from time to time, make written or oral
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Such statements encompass SkyWest's beliefs,
expectations, hopes or intentions regarding future events. Words such as
"forecasts", "expects," "intends," "believes," "anticipates," "should,"
"likely" and similar expressions identify forward-looking statements. All
forward-looking statements included in this release are made as of the date
hereof and are based on information available to SkyWest as of such date.
SkyWest assumes no obligation to update any forward-looking statement.
Readers should note that many factors could affect the future operating and
financial results of SkyWest, SkyWest Airlines or ExpressJet Airlines, and
could cause actual results to vary materially from those expressed in
forward-looking statements set forth in this release. These factors include,
but are not limited to, the ability of ExpressJet Airlines to realize
potential synergies and other anticipated financial impacts of the
consolidation of its operations, the possibility that future financial and
operating results of ExpressJet Airlines may not meet SkyWest's forecasts and
the timing of ongoing consolidation of the operations of ExpressJet Airlines,
if achieved.

Actual operational and financial results of SkyWest, SkyWest Airlines and
ExpressJet Airlines will also vary, and may vary materially, from those
anticipated, estimated, projected or expected for a number of other reasons,
including, in addition to those identified above: the challenges of competing
successfully in a highly competitive and rapidly changing industry;
developments associated with fluctuations in the economy and the demand for
air travel; ongoing negotiations between SkyWest, SkyWest Airlines and
ExpressJet Airlines and their major partners regarding their contractual
obligations; the financial stability of those major partners and any potential
impact of their financial condition on the operations of SkyWest, SkyWest
Airlines, or ExpressJet Airlines; the resolution of current litigation with a
major airline partner of SkyWest Airlines and ExpressJet Airlines;
fluctuations in flight schedules, which are determined by the major partners
for whom SkyWest's operating airlines conduct flight operations; variations in
market and economic conditions; labor relationships; the impact of global
instability; rapidly fluctuating fuel costs; the degree and nature of
competition; potential fuel shortages; the impact of weather-related or other
natural disasters on air travel and airline costs; aircraft deliveries; and
other unanticipated factors. Risk factors, cautionary statements and other
conditions which could cause SkyWest's actual results to differ from
management's current expectations are contained in SkyWest's filings with the
Securities and Exchange Commission; including the section of SkyWest's Annual
Report on Form 10-K for the year ended December 31, 2012, entitled "Risk
Factors."



SKYWEST, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars and Shares in Thousands, Except per Share Amounts)
(Unaudited)
                                                                                            Three
                                                                                           Months Ended

                                                                                           
                                                                                           March
                                                                                           31,
                                                                                           2013     2012
OPERATING REVENUES:
 Passenger                                                                            $       $ 
                                                                                           785,871 902,356
 Ground handling and other                                                            17,616   18,817
 Total operating revenues                                                         803,487  921,173
OPERATING EXPENSES:
 Salaries, wages and benefits                                                         297,396  290,814
 Aircraft maintenance, materials and repairs                                      167,156  179,636
 Aircraft                                                                             49,681   147,450
fuel
 Aircraft rentals                                                                     82,589   84,903
 Depreciation and amortization                                                        61,001   64,315
 Station rentals and landing fees                                                     34,088   43,933
 Ground handling services                                                             34,577   35,315
 Other                                                                                61,438   54,350
 Total operating expenses                                                         787,926  900,716
OPERATING INCOME                                                                           15,561   20,457
OTHER INCOME (EXPENSE):
 Interest income                                                                      1,727    1,954
 Interest expense                                                                     (17,965) (19,780)
 Other, net                                                                           6,039    (3,853)
 Total other (expense), net                                                           (10,199) (21,679)
INCOME (LOSS) BEFORE INCOME TAXES                                                          5,362    (1,222)
PROVISION (BENEFIT) FOR INCOME TAXES                                                       2,129    (540)
NET INCOME (LOSS)                                                                          $     $   
                                                                                           3,233    (682)
BASIC INCOME (LOSS) PER SHARE                                                              $     $   
                                                                                            0.06   (0.01)
DILUTED INCOME (LOSS) PER SHARE                                                            $     $   
                                                                                            0.06   (0.01)
Weighted average common shares:
 Basic                                                                                51,763   50,881
 Diluted                                                                              52,497   50,881



                              Unaudited Operating Highlights
                              Three Months Ended
 Operating Highlights
                              March 31,
                                  2013            2012           % Change
Passengers carried                14,033,174      13,366,246     5.0%
Revenue passenger miles (000)     7,244,635       6,938,913      4.4%
Available seat miles (000)        9,194,309       9,003,482      2.1%
Passenger load factor             78.8%           77.1%          1.70pts
Passenger breakeven load factor   79.0%           77.0%          2.00pts
Yield per revenue passenger mile  $     0.108 $    0.130 (16.9)%
Revenue per available seat mile   $     0.087 $    0.102 (14.7)%
Cost per available seat mile      $     0.088 $    0.102 (13.7)%
Fuel cost per available seat mile $     0.005 $    0.016 (68.8)%
Average passenger trip length     516             519            (0.6)%
Block hours                       571,991         556,421        2.8%
Departures                        350,252         341,140        2.7%

SOURCE SkyWest, Inc.

Website: http://www.skywest.com
Contact: Michael J. Kraupp, Chief Financial Officer and Treasurer, Telephone:
(435) 634-3212, Fax: (435) 634-3205