Hawaiian Airlines nets $12 million in quarter
Advertiser Staff
Hawaiian Airlines, the state's oldest and largest carrier, yesterday said third-quarter net income rose to $12 million, or 35 cents a share, helped by $8.5 million in special federal grants for airlines faced with plummeting air travel in the wake of the Sept. 11 terrorist attacks.
Excluding the special federal assistance, the company said it would have reported net income of $7.4 million, or 21 cents a share.
That compared with a net loss of $218,000, or 1 cent a share, in the same year-ago quarter. Excluding a one-time charge in that year-ago quarter, net income was $6.8 million, or 18 cents a share.
"Along with the rest of the industry, our company experienced immediate and profound negative effects of the terrorist attacks," said Paul J. Casey, vice chairman and chief executive of the airline. "Prior to September 11, and particularly in July and August, Hawaiian was generating profits.
"Thankfully, immediately following Sept. 11 very few of our customers canceled their travel plans. However, the pace of new bookings dropped precipitously. We have since succeeded in stimulating more demand with tactical fare sales; however, these sales will likely diminish overall yields and revenues in the next two quarters."
State visitor statistics show that domestic westbound travel to Hawaii dropped by 90 percent immediately after the lifting of federally mandated airport closures, and improved to 20 percent below the year-earlier period as of Oct. 1.
Eastbound travel from Japan, however, remained 50 percent below the year-earlier period.
The company announced its earnings after the market closed for the day. Its stock closed unchanged yesterday at $2.25.
Operating income for the third quarter was $14.8 million, compared with $1 million the same quarter a year ago. Excluding special one-time aid and charges in the quarters, operating income for the 2001 quarter was $6.3 million; for the 2000 quarter, $13.9 million.
Total operating revenue in the quarter dropped 2 percent to $166.4 million, compared with $169.9 million the same period last year as the total number of scheduled passengers carried by the company dropped 6.8 percent to 1.6 million compared with the same time last year.
The company noted increased costs related to wages and benefits for new labor contracts for pilots and flight attendants, as well as from severance and benefits for workers furloughed in the wake of the terrorist attacks.
Hawaiian Airlines said aircraft rents increased, reflecting increased lease costs associated with the replacement of its aging fleet of 15 interisland DC-9 aircraft with more fuel-efficient Boeing 717-200s. To date, 11 of the new planes are in service and two more will be delivered by year's end.
The company also said it expects to have three of its new Boeing 767-300s in transpacific service by the end of the year. The company took delivery of its first new 767 last month. A total of 16 767s are scheduled for delivery between the end of this year and the second quarter of 2003.
The airline said it saw savings in the quarter as the average cost of fuel dropped, as did consumption with its new, more efficient aircraft.
For the first nine months of the year, the company reported net income rose to $15.2 million, or 44 cents a share, compared with $1.8 million, or 4 cents a share, the same time last year. Total operating revenues rose 2.2 percent, to $470.5 million, compared with $460.5 million the same time last year.
