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2nd Quarter 2014 Airline Financial Data

Press Release Number: 
BTS 44-14
Date: 
Monday, September 22, 2014
Media Contact: 
Dave Smallen, 202-366-5568

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U.S. scheduled passenger airlines reported a net profit of $3.6 billion in the second quarter of 2014, up from $507 million in the first quarter of 2014 and $2.2 billion in the second quarter of 2013, the U.S. Department of Transportation’s Bureau of Transportation Statistics (BTS) reported today (Table 1). 

U.S. Scheduled Service Passenger Airlines Net Income 2Q 2013-2Q 2014

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U.S. Scheduled Service Passenger Airlines Net Income 2Q 2013-2Q 2014

The 27 U.S. scheduled service airlines reported an after-tax net profit as a group for the fifth consecutive quarter.

In addition to the after-tax net profit based on net income reports, the scheduled service passenger airlines reported a $5.5 billion pre-tax operating profit in the second quarter of 2014, up from $1.7 billion in the first quarter of 2014 and up from $3.7 billion in the second quarter of 2013. The airlines reported a pre-tax operating profit - as a group - for the 14th consecutive quarter (Tables 1, 3).

Net income or loss, and operating profit or loss, are two different measures of airline financial performance. Net income or loss may include non-operating income and expenses, nonrecurring items or income taxes. Operating profit or loss is calculated from operating revenues and expenses before taxes and other nonrecurring items.

Total operating revenue for all U.S. passenger airlines in the April-to-June second-quarter of 2014 was $44.6 billion. Airlines collected $33.7 billion from fares, 75.5 percent of total second-quarter operating revenue (Table 1).

Total operating expenses for all passenger airlines in the second-quarter of 2014 were $39.1 billion, of which fuel costs accounted for $10.8 billion, or 27.8 percent, and labor costs accounted for $10.3 billion, or 26.3 percent (Table 1).

In the second quarter, passenger airlines collected a total of $900 million in baggage fees, 2.0 percent of total operating revenue, and $753 million from reservation change fees, 1.7 percent of total operating revenue. Fees are included for calculations of net income, operating revenue and operating profit or loss (Table 1).

Baggage fees and reservation change fees are the only ancillary fees paid by passengers that are reported to BTS as separate items. Other fees, such as revenue from seating assignments and on-board sales of food, beverages, pillows, blankets, and entertainment are combined in different categories and cannot be identified separately.

See airline financial data press releases and the airline financial databases  for historic data.

Totals for Top 10 Scheduled Passenger Airlines

As a group, the top 10 U.S. scheduled passenger airlines, based on operating revenue,  reported an after-tax net profit of $3.5 billion in the second quarter of 2014, up from a profit of $474 million in the first quarter of 2014 and up from a profit of $2.2 billion in the second quarter of 2013  (Table 2). These airlines carried 79.4 percent of U.S. airlines’ scheduled service passengers in the second quarter and accounted for 96.8 percent of the scheduled passenger airline after-tax net profit. 

In addition to the after-tax net income reports, the 10 top airlines reported a $5.3 billion pre-tax operating profit in the second quarter of 2014, up from a profit of $1.6 billion in the first quarter of 2014 and up from a $3.5 billion pre-tax operating profit in the second quarter of 2013 (Table 3). 

Margins for All Scheduled Passenger Airlines

All U.S. scheduled passenger airlines reported a combined net income margin of 8.0 percent in the second quarter of 2014, up from up from a net margin of 5.5 percent in the second quarter of 2013.  Net margin is the net income or loss as a percentage of operating revenue. These airlines reported an operating profit margin of 12.3 percent in the second quarter of 2014, up from 9.0 percent in the second quarter of 2013. Operating margin is the operating profit or loss as a percentage of operating revenue (Table 4).

For the year-to-date January through June period, all U.S. scheduled passenger airlines reported a combined net income margin of 4.9 percent in 2014, up from a net margin of 2.4 percent in 2013.  These airlines reported an operating profit margin of 8.6 percent in the first six months of 2014, up from the same period in 5.5 percent in 2013 (Table 5).

Reporting notes

Additional airline financial data can be found on the BTS website, including industry statistics for other individual low-cost and regional airlines. See tables for operating profit/loss, operating revenue and fuel cost and consumption. See the BTS financial databases for more detailed data.

Data are compiled from quarterly financial and monthly traffic reports filed with BTS by commercial air carriers. Financial and traffic data include data received by BTS as of Sept. 9.  Revised carrier data and late data filings will be made available monthly on TranStats on the Monday following the second Tuesday of the month. All data are subject to revision. BTS will release third-quarter 2014 data on Dec. 15.

 

Table 1. Quarterly U.S. Scheduled Service Passenger Airlines Financial Reports

Reports from 27 airlines in 2Q 2014

(Millions of dollars)

  2Q 2013 3Q 2013 4Q 2013 1Q 2014 2Q 2014 Dollar Change (in millions) 2Q2013-2Q2014
Net Income 2,269 3,165 7,346 507 3,578 1,309
Operating Profit/Loss 3,731 4,730 2,703 1,658 5,499 1,768
Operating Revenue* 41,341 43,244 49,052 38,459 44,620 3,279
Fares 30,984 32,530 29,305 28,731 33,670 2,686
Baggage Fees 871 880 797 791 900 29
Reservation Change Fees 719 735 675 726 753 34
Operating Expenses 37,609 38,514 46,350 36,801 39,122 1,513
Fuel 10,908 10,902 12,086 10,190 10,880 -28
Labor 9,480 9,785 11,135 9,729 10,294 814

Source: Bureau of Transportation Statistics, Form 41; Schedules P1.2 and P6

* Passenger airline operating revenue includes two other categories. 1) Transport-related is revenue from services which grow from and are incidental to the air transportation services performed by the air carrier. Examples are in-flight onboard sales (food, liquor, pillows, etc), code share revenues, revenues from associated businesses (aircraft maintenance, fuel sales, restaurants, vending machines, etc). 2) Miscellaneous operating revenue includes pet transportation, sale of frequent flyer award miles to airline business partners and standby passenger fees. See the P1.2 database http://www.transtats.bts.gov/Fields.asp?Table_ID=295.

 

Table 2. Quarterly Large Airline Systemwide (Domestic + International) Net Income

Ranked by 2Q 2014 Operating Revenue

(millions of dollars)

Rank Airline 2Q 2013 3Q 2013 4Q 2013 1Q 2014 2Q 2014 Dollar Change 1Q2013-1Q2014
1 Delta 689 1,372 8,482 218 807 118
2 United 484 377 154 -580 769 285
3 American 228 290 -1,791 401 265 37
4 Southwest 224 259 213 152 465 241
5 US Airways 325 220 -130 126 605 280
6 JetBlue 36 71 47 -1 231 195
7 Alaska 102 285 76 93 166 64
8 Hawaiian 15 43 19 -3 30 15
9 Spirit 37 54 43 60 106 69
10 SkyWest 25 30 18 7 19 -6
10-Carrier Total 2,165 3,002 7,131 474 3,463 1,298
All Passenger Airlines 2,269 3,165 7,346 507 3,578 1,309

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

 

Table 3. Quarterly Large Airline Systemwide (Domestic + International) Operating Profit/Loss

Ranked by 2Q 2014 Operating Revenue

(millions of dollars)

Rank Airline 2Q 2013 3Q 2013 4Q 2013 1Q 2014 2Q 2014 Dollar Change 1Q2013-1Q2014
1 Delta 949 1,697 870 672 1,616 667
2 United 771 510 238 -341 906 135
3 American 478 683 281 577 718 240
4 Southwest 433 390 386 215 775 342
5 US Airways 477 421 3 189 678 201
6 JetBlue 93 152 111 43 141 48
7 Alaska 189 454 131 147 257 68
8 Hawaiian 40 76 34 12 54 14
9 Spirit 67 98 68 60 105 38
10 SkyWest 51 59 39 21 42 -9
10-Carrier Total 3,548 4,538 2,159 1,596 5,292 1,744
All Passenger Airlines 3,731 4,730 2,703 1,658 5,499 1,768

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

 

Table 4. Quarterly U.S. Scheduled Passenger Airlines Revenue, Expenses and Profits

Reports from 27 airlines in 2Q 2014

(millions of dollars)

  2Q 2013 2Q 2014 Change 2013-2014 % Change % of 2Q 2014 Revenue or Expense Total
Operating Revenue          
Passenger Fares (scheduled/charter) 31,124.6 33,670.2 2,545.6 8.18 75.46
Cargo 753.6 769.3 15.7 2.08 1.72
Baggage 871.1 899.5 28.4 3.26 2.02
Reservation Changes 719.2 752.8 33.6 4.67 1.69
Transport-Related* 7,085.8 7,459.5 373.7 5.27 16.72
Other** 880.7 1,068.9 188.2 21.37 2.40
Total Operating Revenue 41,435.1 44,620.2 3,185.1 7.69 100.00
Operating Expense          
Fuel 10,903.3 10,879.9 -23.4 -0.21 27.81
Labor 9,518.8 10,293.9 775.1 8.14 26.31
Rentals 2,234.8 2,131.1 -103.7 -4.64 5.45
Depreciation & Amortization 1,642.0 1,757.2 115.2 7.02 4.49
Landing Fees 705.0 719.4 14.4 2.04 1.84
Maintenance Materials 690.6 683.9 -6.7 -0.97 1.75
Transport-Related* 5,228.3 5,368.4 140.1 2.68 13.72
Other*** 6,792.8 7,287.8 495.0 7.29 18.63
Total Operating Expense 37,715.7 39,121.5 1,405.8 3.73 100.00
Profits or Losses          
Operating Profit 3,719.3 5,498.7 1,779.4 47.84 N/A
Operating Margin**** (%) 9.0 12.3 N/A N/A N/A
Nonoperating Income/(Expense)# -1,080.4 -517.4 563.0 -52.11 N/A
Pre-Tax Income 2,638.9 4,981.3 2,342.4 88.76 N/A
Income Tax Benefit/(Expense) -375.3 -1,403.3 -1,028.0 273.91 N/A
Other Income/(Expense) 0.0 0.0 0.0 N/A N/A
Net Income 2,259.0 3,578.1 1,319.1 58.39 N/A
Net Margin## (%) 5.5 8.0 N/A N/A N/A

Source: Bureau of Transportation Statistics, Form 41; Schedules P1.2 and P6

* Transport-Related is revenue/expenses from services which grow from and are incidental to the air transportation services performed by the air carrier. Examples are in-flight onboard sales (food, liquor, pillows, etc), code share revenues, revenues and expenses from associated businesses (aircraft maintenance, fuel sales, restaurants, vending machines, etc).

** Other revenue includes miscellaneous operating revenue (including pet transportation, sale of frequent flyer award miles to airline business partners and standby passenger fees) and public service revenues subsidy.

*** Other expense includes purchase of materials such as passenger food and other materials; and purchase of services such as advertising, communication, insurance, outside flight equipment maintenance, traffic commissions and other services.

**** Operating margin is the operating profit or loss as a percentage of operating revenue

# Nonoperating Income and Expense includes interest on long-term debt and capital leases, other interest expense, foreign exchange gains and losses, capital gains and losses and other income and expenses.

## Net margin is the net income or loss as a percentage of operating revenue.

 

Table 5. Jan-June U.S. Scheduled Passenger Airlines Revenue, Expenses and Profits

Reports from 27 airlines in 2Q 2014

(millions of dollars)

  Jan-Jun 2013 Jan-Jun 2014 Change 2013-2014 % Change % of YTD 2014 Revenue or Expense Total
Operating Revenue          
Passenger Fares (scheduled/charter) 59,031.7 62,401.6 3,369.9 5.71 75.11
Cargo 1,486.7 1,474.1 -12.6 -0.85 1.77
Baggage 1,672.1 1,690.5 18.4 1.10 2.03
Reservation Changes 1,404.5 1,478.6 74.1 5.28 1.78
Transport-Related* 13,402.2 13,981.9 579.7 4.33 16.83
Other** 1,707.2 2,052.3 345.1 20.21 2.47
Total Operating Revenue 78,704.4 83,079.0 4,374.6 5.56 100.00
Operating Expense          
Fuel 21,508.9 21,070.2 -438.7 -2.04 27.75
Labor 18,757.3 20,022.8 1,265.5 6.75 26.37
Rentals 4,440.4 4,271.7 -168.7 -3.80 5.63
Depreciation & Amortization 3,243.6 3,473.7 230.1 7.09 4.58
Landing Fees 1,359.0 1,362.6 3.6 0.26 1.79
Maintenance Materials 1,406.2 1,382.9 -23.3 -1.66 1.82
Transport-Related* 10,328.5 10,529.9 201.4 1.95 13.87
Other*** 13,360.5 13,808.8 448.3 3.36 18.19
Total Operating Expense 74,404.4 75,922.6 1,518.2 2.04 100.00
Profits or Losses          
Operating Profit 4,300.0 7,156.4 2,856.4 66.43 N/A
Operating Margin**** (%) 5.5 8.6 N/A N/A N/A
Nonoperating Income/(Expense)# -2,006.3 -1,387.1 619.2 -30.86 N/A
Pre-Tax Income 2,293.7 5,769.2 3,475.5 151.52 N/A
Income Tax Benefit/(Expense) -424.2 -1,684.0 -1,259.8 296.98 N/A
Other Income/(Expense) 0.0 0.0 0.0 N/A N/A
Net Income 1,861.2 4,085.3 2,224.1 119.50 N/A
Net Margin## (%) 2.4 4.9 N/A N/A N/A

Source: Bureau of Transportation Statistics, Form 41; Schedules P1.2 and P6

* Transport-Related is revenue/expenses from services which grow from and are incidental to the air transportation services performed by the air carrier. Examples are in-flight onboard sales (food, liquor, pillows, etc), code share revenues, revenues and expenses from associated businesses (aircraft maintenance, fuel sales, restaurants, vending machines, etc).

** Other revenue includes miscellaneous operating revenue (including pet transportation, sale of frequent flyer award miles to airline business partners and standby passenger fees) and public service revenues subsidy.

*** Other expense includes purchase of materials such as passenger food and other materials; and purchase of services such as advertising, communication, insurance, outside flight equipment maintenance, traffic commissions and other services.

**** Operating margin is the operating profit or loss as a percentage of operating revenue

# Nonoperating Income and Expense includes interest on long-term debt and capital leases, other interest expense, foreign exchange gains and losses, capital gains and losses and other income and expenses.

## Net margin is the net income or loss as a percentage of operating revenue.