JetBlue Airways has reported its results for the second quarter of 2009.
Operating income for the quarter was $76 million, resulting in a 9.4% operating margin, compared to operating income of $21 million and a 2.4% operating margin in the second quarter of 2008.
The pre-tax income for the 2Q09 was $36 million, including an accounting gain of $6 million related to the valuation of JetBlue's auction rate securities. Excluding this accounting gain, JetBlue's pre-tax income for the quarter would have been $30 million. This is a turnaround from the pre-tax loss of $13 million in 2Q08.
Net income for the second quarter was $20 million. Excluding the accounting gain, JetBlue's net income for the quarter would have been $14 million. This compares to JetBlue's 2Q08 net loss of $9 million.
"We are pleased to report our second consecutive quarterly profit against the backdrop of a very difficult economic environment," said Dave Barger, JetBlue's CEO. "These results would not have been possible without the efforts of JetBlue's outstanding crewmembers, who continue to be recognised with awards for exceptional customer service. We believe our strong brand, unique value proposition and ongoing focus on maintaining financial strength will position us for continued success in this recessionary environment. Despite a challenging revenue outlook, we continue to expect to generate a profit every quarter this year."
Operating revenues for the quarter totalled $807 million, representing a decline of 6.0% over the second quarter of 2008. Yield per passenger mile in the second quarter was 11.02 cents, down 4.4% from 2Q08. Passenger revenue per available seat mile (PRASM) in 2Q09 decreased 5.7% on a year over year basis to 8.76 cents and operating revenue per available seat mile (RASM) decreased 4.4% year-over-year to 9.80 cents.
Operating expenses for the quarter decreased 12.7%, or $107 million, over the prior year period. JetBlue's operating expense per available seat mile (CASM) for the second quarter decreased by 11.2% year-over-year to 8.88 cents. Excluding fuel, CASM increased 9.6% to 6.12 cents.
During the second quarter, approximately 9% of JetBlue's fuel consumption was hedged. As a result, JetBlue's realised fuel price in the second quarter was $1.97 per gallon, a 37.9% decrease compared with 2Q08's figure of $3.17. JetBlue realised $42 million in fuel hedging losses during the quarter related to hedge positions it entered into in 2008.
During the second quarter, JetBlue began to rebuild its 2009 and 2010 fuel hedge portfolio. The airline has hedged approximately 9% of its third quarter estimated fuel consumption, 22% of its fourth quarter estimated fuel consumption and 15% of its 2010 estimated fuel consumption with a combination of crude call options and heating oil collars.
JetBlue expects an average price per gallon of fuel, including the impact of hedges, of $2.03 in the third quarter and $1.97 for the full year 2009.
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