Airline reports $30M in losses
By Frank Cho
Advertiser Staff Writer
Hawaiian Airlines' parent company said financial losses soared to more than $30 million during the second quarter because of rising aircraft costs, discounting of ticket prices and the loss of one of its biggest charter customers.
Hawaiian Airlines Inc. reported a loss of $31.1 million, or 92 cents a share, for the three months ended June 30, compared to a profit of $1.9 million, or 6 cents a share, during the same period a year ago.
"Our second-quarter results reflect some of the same lingering effects of 9/11 being felt throughout our industry," said John Adams, the airline's chairman, president and chief executive officer.
The company was also negatively affected by the post-Sept.-11 bankruptcy of Renaissance Cruises last year, which cost the airline more than $10 million in charter revenue, Adams said.
On an operating basis, Hawaiian reported an operating loss of $25.1 million for the quarter, compared to operating income of $2.6 million the same quarter a year ago. Operating revenues were down $11.3 million to $148 million and expenses climbed $16.4 million during the same period to $173.1 million.
To lure travelers back, Hawaiian Airlines has been discounting tickets. During the second quarter, the airline's revenue passenger miles — a measure of paying passengers per mile flown — increased 3.3 percent. That helped fill airline seats to nearly 80 percent capacity during the quarter.
"We've done an effective job of filling the seats, but the yields are not there," said Keoni Wagner, an airline spokesman.
Scheduled passenger seat revenues declined $1.8 million and total revenues for the quarter fell $11.3 million, or 7.1 percent from the same year-ago quarter, primarily because of the loss of Renaissance charters.
Fuel costs fell nearly $7 million during the quarter because of newer, more fuel-efficient Boeing 717-200 and 767-300 aircraft the company now operates. But those savings were more than offset by a $4.7 million jump in wage and benefits costs and $7.4 million in higher insurance fees and other costs related to its failed merger with Aloha Airlines.
"Our focus going forward will be to better match our capacity with demand and continue working to increase average yield," Adams said.
Reach Frank Cho at 525-8088, or fcho@honoluluadvertiser.com.
