This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

AirTran, JetBlue Clipped by Fuel Costs

Low-cost carriers AirTran (AAI) and JetBlue (JBLU - Get Report) on Thursday both reported record revenue, accompanied by losses due to sharply higher fuel costs.

Excluding special items related to fuel hedging, AirTran lost $61.9 million or 53 cents a share in the third quarter. Analysts surveyed by Thomson Reuters had estimated a loss of 39 cents. Revenue rose 10.6% to $673 million. Analysts had expected $676 million.

Including items, AirTran lost $107.1 million or 91 cents a share. In the same quarter a year earlier, it reported net income of $10.6 million or 11 cents a share. AirTran said fuel costs rose by $149 million from a year earlier.

JetBlue said it lost $4 million or 2 cents a share. Analysts had estimated a loss of 4 cents a share. Revenue rose 17.9% to $902 million. Analysts had estimated $899 million. In the same quarter a year earlier, JetBlue earned $23 million or 12 cents a share.

On an earnings conference call, AirTran CEO Bob Fornaro said "no major airline in North America has faced the same headwinds as AirTran." The carrier has not been cushioned from the domestic downturn by international routes, he said, and it has been more sensitive to oil price increases because oil accounts for 51% of its costs, the highest percentage among major carriers.

In the current quarter, revenue per available seat mile (RASM) is expected to increase by 7% to 9%, as capacity falls by 6% to 7%. A late Thanksgiving hurts November bookings, but December is "well ahead of last year," Fornaro said. With industry-low cost per available seat mile excluding fuel of 5.88 cents, "We are well-positioned to return to profitability in the coming quarters," Fornaro said.

Meanwhile, at JetBlue, "We see continued strength in our bookings in the near term," said CEO Dave Barger, in a prepared statement. During the quarter, RASM grew by 20.8% as capacity fell by 2.4%. CASM excluding fuel rose by 13.8% to 5.96 cents.

At Alaska (ALK - Get Report), net income excluding special items was $39.9 million or $1.10 a share. Analysts surveyed by Thomson Reuters had estimated 93 cents. Revenue rose by about 1% to $1.1 billion, slightly ahead of estimates. A year earlier, Alaska earned $78.8 million or $1.93 a share.

Including special items associated with fuel hedging, Alaska lost $86.5 million or $2.40 a share, reversing a year-ago gain of $81.8 million or $2.01 a share. Increased oil prices added costs of $110 million, the company said.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
ALK $69.14 0.06%
JBLU $19.33 0.00%
AAPL $93.24 -0.41%
FB $117.81 -0.21%
GOOG $701.43 0.82%


Chart of I:DJI
DOW 17,660.71 +9.45 0.05%
S&P 500 2,050.63 -0.49 -0.02%
NASDAQ 4,717.0940 -8.5450 -0.18%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs