JetBlue Takes Hit from Hurricane Sandy but Still Reports Profit

JetBlue Airways Corporation, the closely watched low-cost carrier, reported operating income of $44 million in the fourth quarter compared with operating income of $83 million in the same period in 2011. For 2012 as a whole, JetBlue reported operating income of $376 million compared with operating income of $322 million for the full year 2011.

But JetBlue’s net income for the fourth quarter was $1 million compared with fourth quarter 2011 net income of $23 million.  For the full year 2012, JetBlue reported net income of $128 million compared with net income of $86 million for 2011.

JetBlue reported record fourth quarter operating revenues of $1.2 billion despite Hurricane Sandy, which reduced revenue by an estimated $45 million.  Revenue passenger miles for the fourth quarter increased 4.3 percent to 8.1 billion on a capacity increase of 4.8 percent, resulting in a fourth quarter load factor of 81.9 percent, a decrease of 0.3 points year over year.

Yield per passenger mile in the fourth quarter was 13.47 cents, up 0.2 percent compared to the fourth quarter of 2011. Passenger revenue per available seat mile (PRASM) for the fourth quarter 2012 decreased 0.2 percent year over year to 11.03 cents and operating revenue per available seat mile (RASM) decreased 0.5 percent year over year to 12.09 cents.

Operating expenses for the quarter increased 8.3 percent, or $87 million, over the prior year period. JetBlue's operating expense per available seat mile (CASM) for the fourth quarter increased 3.3 percent year over year to 11.65 cents. Excluding fuel, CASM increased 4.8 percent to 7.17 cents.

JetBlue continued to hedge fuel to manage price volatility. Specifically, during the fourth quarter JetBlue hedged approximately 27 percent of its fuel consumption and managed approximately 20 percent of its fuel consumption using fixed forward price agreements (FFPs), resulting in a realized fuel price of $3.20 per gallon, a 1 percent increase over fourth quarter 2011 realized fuel price of $3.15.

Source: Travel Pulse, http://www.travelpulse.com/jetblue-takes-hit-from-hurricane-sandy-but-still-reports-profit.html