Posted on: 29 October 2014 by Mark Howells
Republic Airways Holdings has announced its financial results for the third quarter of 2014 (3Q14) including pre-tax income from continuing operations for 3Q14 of $30.5 million compared with $5.4 million for the prior year’s third quarter (3Q13).
In 3Q13, the company incurred an impairment charge of $21.2 million. Without this impairment, Republic’s pre-tax income from continuing operations increased by $3.9 million, or 14.7%. Republic’s net income for 3Q14 was $18.5 million.
“We continue to be pleased with how our airline is performing both financially and operationally. Our business results would not be possible without the dedication and focus of my 6,500 co-workers, who consistently deliver on our mission of providing safe, clean, reliable and seamless service to our major airline partners on a daily basis,” remarked Republic's chairman, president and CEO Bryan Bedford. “On behalf of our entire leadership team, I sincerely thank all of my co-workers for their passionate and dedicated service.”
Operating revenues increased $11.1 million, or 3.3%, in the third quarter of 2014 to $349.7 million. Fixed-fee service revenue increased $23.4 million, or 7.3%, to $343.7 million due to increased E175 flying with American Airlines offset by the removal of 15 ERJ 140s and 12 ERJ 145s from service. Passenger service revenue decreased $12.6 million because of the removal of E190s operating under pro-rate agreement with Frontier Airlines.
The increase in wages and benefits expenses of $6.7 million, or 7.7%, was primarily due to an increase in E175 operations, an increase in the cost of benefits provided to employees and new pilot flight and duty rest regulations.
Fuel expense for 3Q14 decreased by $6.2 million, or 54.9% compared with 3Q13, to $5.1 million. This was primarily due to a 56.9% decrease in gallons consumed related to the elimination of pro-rated flying for Frontier.
Depreciation and amortization expense for 3Q14 increased $6.7 million, or 18.1%, compared with 3Q13, due primarily to the increase in the E175 fleet.
The other impairment charge of $21.2 million during 3Q13 was due to an impairment charge on owned E190s and the write-off of maintenance deposits on leased E190 aircraft.
The company’s total cash balance decreased $17.2 million to $283.5 million as of 30 September 2014, compared with 31 December 2013.
Republic Airways’ debt increased to $2.35 billion as of 30 September 2014, compared with $2.17 billion at 31 December 2013, mainly attributable to the financing of 17 new E175s bought for the American Airlines fixed-fee agreement partially offset by the company’s debt repayments.