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JetBlue announces 4Q and full year 2008 pre-tax results
JetBlue Airways has reported its pre-tax results for the fourth quarter and full year 2008. The airline recorded a pre-tax loss of $49 million in the fourth quarter and a pre-tax loss of $76 million for the full year 2008.
The fourth quarter loss included a special non-cash charge of $53 million related to the valuation of JetBlue's auction rate securities. Excluding this special charge, JetBlue reported pre-tax income for the quarter of $4 million. This compares to a pre-tax loss of $3 million in the same period of 2007.
For the full year, JetBlue reported a pre-tax loss of $23 million if the special charge is excluded. This compares to pre-tax income of $41 million for the full year 2007.
JetBlue says it is evaluating the tax deductibility of the special charge, but has not yet finalised the amount given the technical nature of the issue. As a result, today JetBlue is only reporting its pre-tax results. Once the tax treatment for this special charge is finalised, the company will report its net results in its Annual Report on Form 10-K, which will be filed in mid-February.
"While we are disappointed to report a loss, I am very proud of what JetBlue accomplished in 2008," said Dave Barger, JetBlue's CEO. "Against the backdrop of record fuel prices and unprecedented economic challenges, we effectively managed our capacity and strengthened our network. We also made significant progress in our efforts to further enhance the JetBlue experience for our customers. JetBlue's industry-leading unit revenue growth throughout the year reflects the outstanding work of our crewmembers."
Operating revenues for the fourth quarter totalled $811 million, representing growth of 9.8% over operating revenues of $739 million in the fourth quarter of 2007. For the full year, operating revenues totalled $3.39 billion, an increase of 19.2% over operating revenues of $2.84 billion for the full year 2007.
Operating expenses for the quarter increased 7.5%, or $53 million, over the prior year period. JetBlue's operating expense per available seat mile (CASM) for the fourth quarter increased 16.1% year-over-year to 10.14 cents. Excluding fuel, CASM increased 17.2% to 6.42 cents. For the full year 2008, JetBlue's CASM, excluding fuel, increased 8.7% to 5.94 cents.
Looking ahead, for the first quarter of 2009, JetBlue expects to report an operating margin between six and eight percent. Pre-tax margin for the quarter is expected to be between zero and two percent. PRASM is expected to increase between two and four percent year-over-year. RASM is expected to increase between five and seven percent year-over-year.
CASM is expected to increase between zero and two percent over the year-ago period. Excluding fuel, CASM in the first quarter is expected to increase between 11 and 13 percent year over year. Capacity is expected to decrease between five and seven percent in the first quarter and stage length is expected to decrease roughly six percent over the same period last year.
For the full year 2009, JetBlue expects to report an operating margin between 12 and 14 percent. Pre-tax margin for the full year is expected to be between six and eight percent. PRASM for the full year is expected to increase between one and four percent year over year. RASM for the full year is expected to increase between three and six percent.
CASM for the full year is expected to decrease between five and seven percent over full year 2008. Excluding fuel, CASM in 2009 is expected to increase between 10 and 12 percent year over year.
Capacity for the full year 2009 is expected to decrease between zero and two percent over 2008 and stage length is expected to decrease about six percent over full year 2008.
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