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Fourth Quarter 2004 Airline Financial Data: Regional Passenger Airlines Only Group to Report Domestic Profit

Fourth Quarter 2004 Airline Financial Data: Regional Passenger Airlines Only Group to Report Domestic Profit

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BTS 22-05
Dave Smallen
202-366-5568

Tuesday, May 17, 2005 - The seven largest regional airlines were the only one of three selected carrier groups to report a domestic operating profit margin ― an industry measure of profitability ― during the fourth quarter of 2004, the Bureau of Transportation Statistics (BTS) of the U.S. Department of Transportation reported today in a release of preliminary data.

BTS, a part of the Research and Innovative Technology Administration, reported that this group of regional carriers reported a domestic operating profit margin of 10.4 percent for the fourth quarter, compared to the 11.5 percent loss margin reported by the seven largest low-cost air carriers and the 15.8 percent loss margin reported by the seven network carriers (Table 1). Domestic operating margin measures operating profit or loss as a percentage of the airline's total domestic operating revenue.

The domestic passenger airline industry operating margin, represented by the 21 selected carriers, declined from a 3.8 percent loss margin in the third quarter to a 12.2 percent loss margin in the fourth quarter. Quarter-to-quarter changes may be affected by seasonal factors.

The selected low-cost carriers reported a 16.8 percentage point worsening in profit margin from the fourth quarter of 2003, while the selected network carriers saw an eight percentage point worsening in their operating loss margin from a year earlier.

The largest percentage operating loss margins were reported by low-cost carrier ATA Airlines (Table 3) - the airline filed for Chapter 11 bankruptcy protection on Oct. 26 - and network carriers United Airlines and Delta Air Lines (Table 2). The top operating profit margins were all reported by regional airlines - American Eagle Airlines, ExpressJet Airlines and Mesa Air Group (Table 4).

Network carriers operate a significant portion of their flights using at least one hub where connections are made for flights on a spoke system. Low-cost carriers are those that the industry generally recognizes as operating under a low-cost business model. Regional carriers provide service from small cities, using primarily regional jets to support the network carriers' hub and spoke systems. The selected groups consist of the seven carriers with the highest annual reported revenue in each group.

The regional carriers had the highest unit revenues with 14.6 cents per available seat mile (Table 5). These higher unit revenues generally reflect the shorter flights and smaller aircraft flown by these carriers. Regional carriers average flights of 300 to 450 miles, compared to the 1,000-mile average stage length for the network carriers. Domestic unit revenue measures revenues against capacity by dividing domestic operating revenues by domestic available seat miles.

Overall, the highest unit revenues were reported by regional carriers American Eagle, SkyWest Airlines and Atlantic Southeast Airlines (Table 8). The lowest unit revenues were reported by low-cost carriers Spirit Airlines, JetBlue Airways and ATA (Table 7). Northwest Airlines reported the highest unit revenues among the selected network carriers (Table 6).

The network carriers reported the highest domestic unit costs - 13.7 cents per available seat mile (Table 9). The low-cost carriers reported the lowest unit costs - 8.8 cents per available seat mile. Domestic unit cost measures expenses against capacity by dividing domestic operating expenses by domestic available seat miles.

The carriers with the highest unit costs were low-cost carrier ATA (Table 12) and network carriers Northwest and Continental Airlines (Table 10). The carriers with the lowest unit costs were low-cost carriers JetBlue, Southwest Airlines and AirTran Airways (Table 11).

The regional carriers also reported the highest domestic passenger revenue yields ― at 20.7 cents per revenue passenger mile (Table 13). Domestic passenger revenue yield measures passenger revenues against total travel by dividing domestic passenger revenues by domestic revenue passenger miles.

The top passenger revenue yields were reported by regional carriers American Eagle, Pinnacle Airlines and SkyWest (Table 16). The lowest passenger revenue yields were reported by low-cost carriers ATA, JetBlue and America West Airlines (Table 15). US Airways reported the highest revenue yield of any network carrier (Table 14).

Additional airline financial data can be found later today on the BTS website at TranStats, the Intermodal Transportation Database, http://transtats.bts.gov. Click on "aviation,"then on "Air Carrier Financial Reports (Form 41 Financial Data)," then click on "Schedule P-12."

Data are compiled from quarterly financial and monthly traffic reports filed with BTS by commercial air carriers. Financial and traffic data are preliminary and include data received by BTS as of May 10. Data are subject to revision. Data from the third-quarter of 2004 and previous quarters are posted on the BTS website at http://transtats.bts.gov. BTS has scheduled June 20 for release of first-quarter 2005 data.

Table 1: Quarterly Domestic Operating profit/loss margin (in percent)

Passenger Airlines by Group
Ranked by 4th Quarter 2004 Margin
(Operating Profit/Loss as Percent of Total Operating Revenue)

Excel | CSV

4Q 2004 Rank   4th Quarter 2003 (%) 1st Quarter 2004 (%) 2nd Quarter 2004 (%) 3rd Quarter 2004 (%) 4th Quarter 2004 (%) 4th Quarter Operating Profit/Loss $(Millions)
1 Regionals N/A 11.0 11.5 11.0 10.4 214.0
2 Low-Cost 5.3 1.6 7.1 3.6 -11.5 -394.1
3 Network -7.8 -10.0 -2.8 -7.6 -15.8 -2,185.4
  21-Carrier Total N/A -5.9 0.3 -3.8 -12.2 -2,365.5

Source: Bureau of Transportation Statistics; Form 41, Schedule P1.2

Table 2: Quarterly Domestic Operating profit/loss margin (in percent)

Network Carriers
Ranked by 4th Quarter 2004 Margin
(Operating Profit/Loss as Percent of Total Operating Revenue)

Excel | CSV

4Q 2004 Rank Network Carriers 4th Quarter 2003 (%) 1st Quarter 2004 (%) 2nd Quarter 2004 (%) 3rd Quarter 2004 (%) 4th Quarter 2004 (%) 4th Quarter Operating Profit/Loss $(Millions)
1 US Airways -4.8 -11.0 2.0 -14.3 -10.1 -142.6
2 Northwest -0.2 -2.9 4.3 1.6 -11.7 -221.9
3 Alaska -4.2 -11.2 1.0 6.9 -11.7 -56.7
4 American -13.8 -8.3 -4.6 -8.2 -14.0 -410.3
5 Continental -8.5 -9.9 -4.4 -7.0 -15.4 -252.4
6 Delta -6.7 -13.1 -6.3 -13.0 -17.7 -524.4
7 United -8.9 -12.2 -4.7 -7.7 -22.7 -577.1
  Seven-Carrier Total -7.8 -9.9 -2.8 -7.6 -15.8 -2,185.4

Source: Bureau of Transportation Statistics; Form 41, Schedule P1.2

Table 3: Quarterly Domestic Operating profit/loss margin (in percent)

Low-Cost Carriers
Ranked by 4th Quarter 2004 Margin
(Operating Profit/Loss as Percent of Total Operating Revenue)

Excel | CSV

4Q 2004 Rank Low-Cost Carriers 4th Quarter 2003 (%) 1st Quarter 2004 (%) 2nd Quarter 2004 (%) 3rd Quarter 2004 (%) 4th Quarter 2004 (%) 4th Quarter Operating Profit/Loss $(Millions)
1 Southwest 7.3 3.1 11.5 11.4 7.2 119.1
2 JetBlue 13.4 11.3 14.1 7.1 3.7 12.2
3 AirTran 8.7 4.3 11.3 -4.9 1.3 3.6
4 America West 1.1 2.0 2.6 -4.7 -6.9 -40.9
5 Frontier 7.7 -8.0 -3.8 -0.3 -7.3 -15.3
6 Spirit -3.0 2.0 -3.0 -13.3 -31.6 -36.0
7 ATA -6.5 -14.8 -9.1 -12.5 -187.0 -436.7
  Seven-Carrier Total 5.3 1.6 7.1 3.6 -11.5 -394.0

Source: Bureau of Transportation Statistics; Form 41, Schedule P1.2

Table 4: Quarterly Domestic Operating profit/loss margin (in percent)

Regional Carriers
Ranked by 4th Quarter 2004 Margin
(Operating Profit/Loss as Percent of Total Operating Revenue)

Excel | CSV

4Q 2004 Rank Regional Carriers 4th Quarter 2003 (%) 1st Quarter 2004 (%) 2nd Quarter 2004 (%) 3rd Quarter 2004 (%) 4th Quarter 2004 (%) 4th Quarter Operating Profit/Loss $(Millions)
1 American Eagle 20.6 16.3 15.5 14.1 14.9 59.5
2 ExpressJet 12.9 12.5 12.6 12.4 13.3 47.3
3 Mesa N/A 12.3 11.6 11.7 12.4 28.7
4 SkyWest 12.2 13.7 13.2 12.3 11.3 36.8
5 Pinnacle N/A 10.7 11.1 11.0 9.7 17.5
6 Atlantic Southeast 9.8 7.7 6.7 9.0 9.4 24.8
7 Comair 16.5 6.9 7.9 8.1 -0.2 -0.6
  Seven-Carrier Total N/A 11.0 11.5 11.0 10.4 214.0

Source: Bureau of Transportation Statistics; Form 41, Schedule P1.2

Table 5: Airline Domestic Unit Revenue (Cents Per Mile)

Passenger Airlines by Group
Ranked by 4th Quarter Domestic Unit Revenue
(Domestic Operating Revenue Per Available Seat Mile)

Excel | CSV

4Q 2004 Rank   4th Quarter 2003 1st Quarter 2004 2nd Quarter 2004 3rd Quarter 2004 4th Quarter 2004 4th Quarter Operating Revenue $(Millions)
1 Regionals N/A 14.6 14.1 14.2 14.6 2,062.0
2 Network 11.4 11.5 12.1 11.7 11.8 13,879.4
3 Low-Cost 7.9 7.8 8.5 8.0 7.9 3,415.1
  21-Carrier Total N/A 10.8 11.4 11.0 11.1 19,356.5

Source: Bureau of Transportation Statistics; Form 41, Schedule P1.2.  T100; T2 Data

Table 6: Airline Domestic Unit Revenue (Cents Per Mile)

Network Carriers
Ranked by 4th Quarter Domestic Unit Revenue
(Domestic Operating Revenue Per Available Seat Mile)

Excel | CSV

4Q 2004 Rank Network Carriers 4th Quarter 2003 1st Quarter 2004 2nd Quarter 2004 3rd Quarter 2004 4th Quarter 2004 4th Quarter Operating Revenue $(Millions)
1 Northwest 11.7 12.7 14.1 14.1 13.7 1,900.2
2 US Airways 15.2 14.4 16.3 14.1 13.7 1,415.9
3 Continental 10.3 10.3 10.6 10.3 13.2 1,641.6
4 Delta 12.5 12.3 12.7 12.3 11.9 2,962.5
5 United 10.7 10.8 11.4 11.4 11.3 2,542.2
6 American 10.4 10.4 10.7 10.1 10.2 2,933.4
7 Alaska 10.0 9.8 10.3 10.8 9.9 483.6
  Seven-Carrier Total 11.4 11.5 12.1 11.7 11.8 13,879.4

Source: Bureau of Transportation Statistics; Form 41, Schedule P1.2.  T100; T2 Data

Table 7: Airline Domestic Unit Revenue (Cents Per Mile)

Low-Cost Carriers
Ranked by 4th Quarter Domestic Unit Revenue
(Domestic Operating Revenue Per Available Seat Mile)

Excel | CSV

4Q 2004 Rank Low-Cost Carriers 4th Quarter 2003 1st Quarter 2004 2nd Quarter 2004 3rd Quarter 2004 4th Quarter 2004 4th Quarter Operating Revenue $(Millions)
1 Frontier 9.3 9.3 9.3 9.5 10.2 208.2
2 AirTran 8.9 8.6 9.5 8.2 8.4 279.4
3 Southwest 8.3 8.1 9.1 8.6 8.2 1,655.0
4 America West 7.9 8.2 8.5 8.1 8.0 591.0
5 Spirit 7.8 8.1 7.9 7.6 7.2 114.0
6 JetBlue 7.0 6.8 6.9 6.6 6.7 334.0
7 ATA 6.1 5.9 6.6 6.5 5.9 233.5
  Seven-Carrier Total 7.9 7.8 8.5 8.0 7.9 3,415.1

Source: Bureau of Transportation Statistics; Form 41, Schedule P1.2.  T100; T2 Data

Table 8: Airline Domestic Unit Revenue (Cents Per Mile)

Regional Carriers
Ranked by 4th Quarter Domestic Unit Revenue
(Domestic Operating Revenue Per Available Seat Mile)

Excel | CSV

4Q 2004 Rank Regional Carriers 4th Quarter 2003 1st Quarter 2004 2nd Quarter 2004 3rd Quarter 2004 4th Quarter 2004 4th Quarter Operating Revenue $(Millions)
1 American Eagle 17.0 17.6 16.9 16.5 17.2 398.9
2 SkyWest 14.6 15.3 15.4 15.1 15.5 322.9
3 Atlantic Southeast 13.3 13.2 12.9 13.6 14.7 263.7
4 Pinnacle N/A 16.3 15.4 14.5 14.5 181.3
5 Express Jet 14.8 15.3 14.4 14.5 14.4 357.1
6 Comair 13.0 12.4 12.5 13.3 13.3 297.3
7 Mesa N/A 12.3 11.6 11.7 12.4 240.8
  Seven-Carrier Total N/A 14.6 14.1 14.2 14.6 2,062.0

Source: Bureau of Transportation Statistics; Form 41, Schedule P1.2.  T100; T2 Data

Table 9: Airline Domestic Unit Costs (Cents Per Mile)

Passenger Airlines by Group
Ranked by 4th Quarter Domestic Unit Costs
(Domestic Operating Expenses per Available Seat Mile in cents)

Excel | CSV

4Q 2004 Rank   4th Quarter 2003 1st Quarter 2004 2nd Quarter 2004 3rd Quarter 2004 4th Quarter 2004 4th Quarter Operating Expense $(Millions)
1 Network 12.3 12.6 12.4 12.6 13.7 16,064.7
2 Regionals N/A 13.0 12.5 12.6 13.1 1,851.8
3 Low-Cost 7.5 7.7 7.9 7.8 8.8 3,809.1
  21-Carrier Total N/A 11.4 11.3 11.4 12.4 21,725.6

Source: Bureau of Transportation Statistics; Form 41, Schedule P1.2.  T100; T2 Data

Table 10: Airline Domestic Unit Costs (Cents Per Mile)

Network Carriers
Ranked by 4th Quarter Domestic Unit Costs
(Domestic Operating Expenses per Available Seat Mile in cents)

Excel | CSV

4Q 2004 Rank Network Carriers 4th Quarter 2003 1st Quarter 2004 2nd Quarter 2004 3rd Quarter 2004 4th Quarter 2004 4th Quarter Operating Expense $(Millions)
1 Northwest 11.7 13.1 13.5 13.9 15.4 2,122.1
2 Continental 11.1 11.3 11.0 11.0 15.3 1,894.0
3 US Airways 15.9 16.0 16.0 16.1 15.0 1,558.5
4 Delta 13.3 13.9 13.5 13.9 14.1 3,486.9
5 United 11.7 12.2 11.9 12.3 13.9 3,119.2
6 American 11.9 11.2 11.2 10.9 11.6 3,343.7
7 Alaska 10.4 10.9 10.2 10.1 11.1 540.3
  Seven-Carrier Total 12.3 12.6 12.4 12.6 13.7 16,064.7

Source: Bureau of Transportation Statistics; Form 41; Schedule P1.2.  T100; T2 Data

Table 11: Airline Domestic Unit Costs (Cents Per Mile)

Low-Cost Carriers
Ranked by 4th Quarter Domestic Unit Costs
(Domestic Operating Expenses per Available Seat Mile in cents)

Excel | CSV

4Q 2004 Rank Low-Cost Carriers 4th Quarter 2003 1st Quarter 2004 2nd Quarter 2004 3rd Quarter 2004 4th Quarter 2004 4th Quarter Operating Expense $(Millions)
1 ATA 6.5 6.8 7.2 7.3 16.9 670.2
2 Frontier 8.6 10.1 9.7 9.5 10.9 223.5
3 Spirit 8.0 8.0 8.2 8.6 9.5 150.0
4 America West 7.8 8.0 8.3 8.5 8.6 631.9
5 AirTran 8.1 8.2 8.5 8.6 8.3 275.8
6 Southwest 7.7 7.8 8.1 7.6 7.6 1,535.9
7 JetBlue 6.1 6.1 5.9 6.1 6.5 321.8
  Seven-Carrier Total 7.5 7.7 7.9 7.8 8.8 3,809.1

Source: Bureau of Transportation Statistics; Form 41; Schedule P1.2.  T100; T2 Data.

Table 12: Airline Domestic Unit Costs (Cents Per Mile)

Regionals
Ranked by 4th Quarter Domestic Unit Costs
(Domestic Operating Expenses per Available Seat Mile in cents)

Excel | CSV

4Q 2004 Rank Regional Carriers 4th Quarter 2003 1st Quarter 2004 2nd Quarter 2004 3rd Quarter 2004 4th Quarter 2004 4th Quarter Operating Expense $(Millions)
1 American Eagle 13.5 14.8 14.3 14.2 14.6 339.4
2 SkyWest 12.8 13.2 13.4 13.2 13.8 289.9
3 Atlantic Southeast 12.0 12.2 12.0 12.3 13.3 238.9
4 Comair 10.9 11.6 11.5 12.2 13.3 297.9
5 Pinnacle N/A 14.6 13.7 12.9 13.1 163.8
6 Express Jet 12.9 13.4 12.6 12.7 12.5 309.8
7 Mesa N/A 11.8 10.3 10.8 10.9 212.1
  Seven-Carrier Total N/A 13.0 12.5 12.6 13.1 1,851.8

Source: Bureau of Transportation Statistics; Form 41; Schedule P1.2.  T100; T2 Data.

Table 13: Domestic Passenger Revenue Yield (Cents Per Mile)

Passenger Airlines by Group
Ranked by 4th Quarter Domestic Revenue Yield
(Domestic Passenger Revenue per Revenue Passenger Mile in cents)

Excel | CSV

4Q 2004 Rank   4th Quarter 2003 1st Quarter 2004 2nd Quarter 2004 3rd Quarter 2004 4th Quarter 2004 4th Quarter Passenger Revenue $(Millions)
1 Regionals N/A 22.4 19.3 19.5 20.7 2,058.6
2 Network 12.4 12.4 11.9 11.1 11.3 9,995.7
3 Low-Cost 10.7 10.6 10.2 9.7 10.2 3,147.6
  21-Carrier Total N/A 12.6 12.0 11.4 11.8 15,201.9

Source: Bureau of Transportation Statistics; Form 41; Schedule P1.2.  T100; T2 Data

Table 14: Domestic Passenger Revenue Yield (Cents Per Mile)

Network Carriers
Ranked by 4th Quarter Domestic Revenue Yield
(Domestic Passenger Revenue per Revenue Passenger Mile in cents)

Excel | CSV

4Q 2004 Rank Network Carriers 4th Quarter 2003 1st Quarter 2004 2nd Quarter 2004 3rd Quarter 2004 4th Quarter 2004 4th Quarter Passenger Revenue $(Millions)
1 US Airways 14.8 14.4 14.0 12.4 12.8 960.7
2 Northwest 13.8 13.8 13.4 12.8 12.8 1,335.9
3 Alaska 12.7 12.4 12.4 12.3 11.9 420.7
4 American 12.2 12.0 11.5 10.6 11.0 2,381.4
5 Continental 11.9 12.5 11.9 11.1 11.4 1,100.7
6 Delta 12.0 12.1 11.5 10.6 10.9 1,993.9
7 United 11.3 11.4 10.8 10.1 10.4 1,802.4
  Seven-Carrier Total 12.4 12.4 11.9 11.1 11.3 9,995.7

Source: Bureau of Transportation Statistics; Form 41; Schedule P1.2.  T100; T2 Data.

Table 15: Domestic Passenger Revenue Yield (Cents Per Mile)

Low-Cost Carriers
Ranked by 4th Quarter Domestic Revenue Yield
(Domestic Passenger Revenue per Revenue Passenger Mile in cents)

Excel | CSV

4Q 2004 Rank Low-Cost Carriers 4th Quarter 2003 1st Quarter 2004 2nd Quarter 2004 3rd Quarter 2004 4th Quarter 2004 4th Quarter Passenger Revenue $(Millions)
1 Southwest 12.0 11.8 11.2 11.1 11.7 1,542.5
2 AirTran 12.3 12.1 12.2 11.3 11.7 269.2
3 Frontier 12.0 11.8 11.0 10.7 11.3 174.3
4 Spirit 9.2 10.1 10.1 8.8 9.4 110.2
5 America West 9.7 10.0 9.5 8.6 9.2 523.1
6 JetBlue 8.2 8.3 7.9 7.6 7.7 320.4
7 ATA 8.3 8.3 8.2 7.7 7.6 207.9
  Seven-Carrier Total 10.7 10.6 10.2 9.7 10.2 3,147.6

Source: Bureau of Transportation Statistics; Form 41; Schedule P1.2.  T100; T2 Data

Table 16: Domestic Passenger Revenue Yield (Cents Per Mile)

Regionals
Ranked by 4th Quarter Domestic Revenue Yield
(Domestic Passenger Revenue per Revenue Passenger Mile in cents)

Excel | CSV

4Q 2004 Rank Regional Carriers 4th Quarter 2003 1st Quarter 2004 2nd Quarter 2004 3rd Quarter 2004 4th Quarter 2004 4th Quarter Passenger Revenue $(Millions)
1 American Eagle 25.6 27.4 23.8 23.4 25.0 397.7
2 Pinnacle N/A 25.9 20.7 20.0 21.7 179.4
3 SkyWest 19.9 21.5 20.3 19.5 21.1 322.9
4 Atlantic Southeast 19.9 20.9 18.1 19.2 20.6 263.7
5 Comair 19.1 19.7 17.6 19.1 19.7 297.3
6 Express Jet 21.1 24.0 19.5 19.4 19.7 356.8
7 Mesa N/A 18.5 15.6 15.6 17.4 240.8
  Seven-Carrier Total N/A 22.4 19.3 19.5 20.7 2,058.6

Source: Form 41; Schedule P1.2.  T100; T2 Data.