Hawaiian Air parent earns profit
By Alan Yonan Jr.
Advertiser Staff Writer
The parent of Hawaiian Airlines overcame soaring jet fuel prices to eke out a small profit in the first quarter.
The gain came during a period in which several of the nation's larger carriers, including three that serve Hawai'i, reported sizable losses.
Hawaiian Holdings reported net income of $200,000 for the quarter, down from a $23.5 million gain during the same three-month period in 2009.
"Despite substantially higher fuel costs and inflationary pressures on other cost lines, Hawaiian managed to break even in what is customarily the weakest quarter of the year," said Mark Dunkerley, the airline's president and chief executive officer.
Hawaiian spent $70.3 million on jet fuel in the first quarter, which represented nearly one-fourth of its operating expenses. The average cost per gallon of fuel including taxes and delivery rose to $2.16 in the first quarter, a 46 percent increase over the comparable period a year earlier.
Besides higher fuel costs, Hawaiian saw its maintenance and repair expenses rise by $7.1 million to $35.9 million.
Total operating expenses rose 16 percent to $292.8 million in the first quarter. Operating revenue rose 3.4 percent to $298.4 million.
The state's largest airline improved in several measures of performance. Hawaiian flew 2 million passengers during the quarter, a fractional increase from a year earlier. Load factor, or percentage of available seats that are filled, rose to 83.6 percent from 81.9 percent. Passenger yield, the amount of revenue generated per passenger per mile, rose 5.8 percent to 13.72 cents.
Profitability was not the norm among other carriers reporting their first-quarter financial results this week. American Airlines parent AMR Corp. lost $505 million, Delta Air Lines Inc. lost $256 million and Continental Airlines Inc. lost $146 million.
The first quarter is typically the slowest in the airline business, falling between the winter holidays and summer vacations.
Analysts expect things to improve the rest of this year as the economy gets stronger.
Dunkerley also disclosed during a conference call with investors that the first of 10 new Airbus A330-200 aircraft being acquired by Hawaiian will go into service in early June on the airline's Los Angeles-to-Honolulu route.
"As a company we are very excited about the arrival of the A330," he said. "This aircraft will not only establish a new product standard on the transpacific routes, but it will improve our operating efficency and bring additional destinations within our capabilities."
Hawaiian's shares fell 2 cents to close at $7.38 on the Nasdaq stock market.