Posted on: Friday, November 21, 2003

Hawaiian Airlines posts strong October

By Dan Nakaso
Advertiser Staff Writer

Hawaiian Airlines had its best October ever as the bankrupt airline recorded its fifth consecutive month of operating profits.

The state's largest airline earned $2 million in operating profit on revenues of $57 million, said a monthly financial statement filed yesterday in bankruptcy court.

Hawaiian actually recorded a net loss of $95 million for the month after subtracting a $97 million claim by Ansett Worldwide, one of three companies that leases airplanes to Hawaiian. Hawaiian's bankruptcy trustee Josh Gotbaum said the charge is the result of reduced rental payments for Boeing 767 planes.

"This claim will not be settled until Hawaiian emerges from bankruptcy, and even then it won't be paid in cash," Gotbaum said in a statement. "Nonetheless, a bankruptcy claim that has been allowed by the court must be recognized in the company's accounts."

Gotbaum has said he hopes to pay many of the claims against Hawaiian with stock instead of cash. The move could result in Hawaiian being owned by its debt holders.

The operating profit of $2 million last month compares with a $7 million operating loss in October 2002.

The strong October performance this year represents Hawaiian's continuing efforts to emerge from bankruptcy and is part of a growing demand for travel to the Islands.

"It is becoming clear that the airline industry is beginning to recover," Gotbaum said. "Airline after airline is reporting improving results. Our own efforts to fill seats and raise revenue where we can are clearly bearing fruit."

Hawaiian's October numbers follow the airline's best September ever, a traditionally slow month. Hawaiian had $5 million in profit in September and $22 million at the end of a hot summer season. By the end of October, Hawaiian had $60 million in operating income for the year.

Reach Dan Nakaso at dnakaso@honoluluadvertiser.com or 525-8085.