JetBlue Loss Narrower Than Expected

The carrier also says it will slow capacity growth when the summer travel season ends.
Author:
Publish date:

JetBlue

(JBLU) - Get Report

lost $8 million in the first quarter and said it will slow capacity growth when the summer travel season ends.

The loss was equal to 4 cents a share, 3 cents better than what analysts had estimated. Revenue rose 34.2% to $816 million and exceeded the consensus forecast of $786 million.

In the same quarter a year earlier, the carrier lost $22 million, or 12 cents a share.

"We continue to see healthy demand throughout our network, and we are encouraged with the industry's more disciplined approach to capacity," said CEO Dave Barger, in a prepared statement. "However, JetBlue is not immune to the unprecedented rise in fuel prices, and we are taking steps to respond to this environment."

Shares of JetBlue were up 3% early Tuesday.

Barger said 2008 capacity will now grow by 3% to 5%. Additionally, the carrier said that starting June 1, it will join in an industry trend, charging $20 for a second checked bag.

For the quarter, passenger revenue per available seat mile grew by 16.5%, as yield rose 20.2%. Capacity increased by 13.9%, while load factor declined by 2.4 points to 78.2%.

On the expense side, cost per available seat mile grew by 12.8%. Excluding fuel, CASM decreased by 0.2% to 5.84 cents.

Looking ahead, JetBlue said it expects passenger RASM to rise by 8% to 10% this year, while CASM, excluding fuel, will grow by 6% to 8%. During the second quarter, the carrier's pretax margin will be between negative 3% and negative 1%.

This is the second busy week for quarterly results from the airline sector. Also Tuesday,

AirTran

(AAI)

had a wider-than-expected loss and said it

will slow capacity growth

.

UAL

(UAUA)

, the owner of United, missed analysts' bottom-line expectations.

Later this week,

Delta

(DAL) - Get Report

and

Northwest

(NWA)

, who

plan to merge

, will post their numbers.

Continental

(CAL) - Get Report

,

Southwest

(LUV) - Get Report

and

AMR

(AMR)

, the parent of American Airlines, reported last week.