Airtran 2000 Annual Report Download

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Table of contents

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    This artwork is for basic concept and placement only. AirTran Holdings, Inc. Annual Report 2K

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    ...revenue passenger miles in 2000, your airline broke records for traffic, passenger enplanements and earnings. Year-end marked the eighth consecutive profitable quarter. This kind of long-term growth leaves little doubt that AirTran Airways is America's most successful new airline. Earnings Per Share...

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  • Page 7
    ...first full year of Boeing 717 service, adding a total of 16 new planes to the fleet by December of 2000. One new 717 will be delivered to the airline each month for the next three years, with an option on 50 more aircraft thereafter. For years to come, AirTran Airways will reap the rewards of having...

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  • Page 9
    ... expansion AirTran Airways has done more than just maintain its position as the second largest airline at the world's busiest airport. The airline increased market share by establishing five new markets and adding more service to and from existing markets. This created more strength at our Atlanta...

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    ... of skyrocketing fuel costs, along with many other adverse market forces, and to produce eight consecutive profitable quarters is a major milestone for even the 13.1 3.1 Q1 Q4 1999 Q2 2000 1999 15.0 8.9 Q3 Q3 1999 2000 Q2 Q4 2000 Q1 1999 2000 9.9 2.9 7.5 22.6 Net Profit By Quarter (in...

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    The crew Having a growing fleet of planes and an expanding route map won't get you anywhere without the right team behind it all. AirTran Airways has built an airline with a strong future by building a team of Crew Members capable of continually exceeding customers' expectations. We are driven by a ...

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    ... airline industry, Internet sales are the most profitable method of distribution, and AirTran Airways continued to outpace the rest of the industry in online sales, for both rates of growth and as a percentage of sales. Online prowess is another example of the Company's advantageous position going...

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    ... position as the second largest airline at the world's busiest airport. AirTran Airways increased market share in Atlanta by adding flights to new markets such as Myrtle Beach, Minneapolis/St. Paul, Toledo and Pittsburgh, while adding new nonstop service between Philadelphia and three Florida cities...

  • Page 18
    ... chief financial officer of AirTran Airways. Prior to Atlas Air, Gadek held related positions at Northwest Airlines and Continental Airlines. Thomas Kalil, an industry veteran, previously with Continental Airlines, assumed the role of senior vice president of customer service, which includes airport...

  • Page 19
    ... travelers booking air travel via airtran.com to link directly to Hertz's Web site. In 2000, Delta Air Lines, Trans World Airlines, United Airlines, US Airways and American Trans Air recognized AirTran Airways' arrival as an undeniable presence in the industry by signing interline ticket and baggage...

  • Page 20
    Again in 2000, AirTran Airways offered "the fastest free ticket on earth" to travelers using our A-Plus Rewards® program. The program was enhanced in 2000 by offering passengers new benefits such as the option to exchange their flight credits for Business Class upgrades. As the most generous ...

  • Page 21
    ...) 2000 Operating revenues Net income (loss) Basic earnings (loss) per common share Diluted earnings (loss) per common share Total assets at year-end Long-term debt including current maturities at year-end Note: All special items listed below are pre-tax. (a) See Note 1 to the consolidated financial...

  • Page 22
    ... stage length (miles) Average cost of aircraft fuel per gallon (cents) Average daily utilization (hours:minutes) (9) 6.87 537 100.89 10:18 53 Number of operating aircraft in fleet at end of period (1) The number of scheduled revenue miles flown by passengers (2) The number of seats available...

  • Page 23
    ... per revenue passenger mile. As a result, our unit revenue or RASM increased 16.0 percent to 10.3 cents. During 2000, we increased our capacity, or ASMs, by 7.2 percent with the addition of eight new Boeing 717 (B717) aircraft. In addition, RPMs increased by 18.5 percent, resulting in a record load...

  • Page 24
    ...million year-over-year, and 20.9 percent on a CASM basis, primarily due to a lesser number of Boeing 737 and DC-9 airframe and engine repairs performed during 2000 in accordance with our maintenance schedule. The timing of maintenance to be performed is determined by the number of hours the aircraft...

  • Page 25
    ... resulted from the utilization of a portion of our $141.0 million of net operating loss (NOL) carryforwards, existing at December 31, 1998, offset in part by alternative minimum tax and the application to goodwill of the tax benefit related to the realization of a portion of the Airways Corporation...

  • Page 26
    ... B737 aircraft throughout the year. Other operating expenses decreased by $7.3 million, or 11.0 percent, primarily due to the decline of credit card chargebacks and communications costs. In the fourth quarter of 1999, we decided to accelerate the retirement of our owned DC-9 fleet to accommodate...

  • Page 27
    ... B717s and the scheduled progress payments for future B717 aircraft deliveries. Cash used for financing activities was $53.1 million, which primarily related to the payment of long-term debt. Initially, we contracted with an affiliate of Boeing to purchase 50 B717 aircraft for delivery between 1999...

  • Page 28
    ... new senior secured notes to be issued by our subsidiary, AirTran Airways, will bear a fixed rate of interest to be determined at closing equal to the sum or difference of 12.25 percent and changes in Boeing Capital's cost of borrowing from and after November 9, 2000, to closing. Principal payments...

  • Page 29
    ... to be provided by Boeing and its affiliates (from the lease financing commitment and other provisions of the B717 purchase agreement), aircraft-related debt and/or lease financing should be available when needed. However, we cannot assure investors that we will be able to secure financing on terms...

  • Page 30
    ... of services offered by us; • our ability to achieve and maintain acceptable cost levels; • fare levels and actions by competitors; • regulatory matters, general economic conditions, commodity prices; and • changing business strategy and results of litigation. Additional information...

  • Page 31
    ... per share data) Year ended December 31, Operating Revenues: Passenger Cargo Other Total operating revenues Operating Expenses: Salaries, wages and benefits Aircraft fuel Maintenance, materials and repairs Distribution Landing fees and other rents Marketing and advertising Aircraft rent Depreciation...

  • Page 32
    ... (16,018) 11,443 Total property and equipment Other Assets: Intangibles resulting from business acquisition Trade names Unexpended debt proceeds - restricted Debt issuance costs Other assets Total assets See accompanying notes to consolidated financial statements. 2000 1999 $ 78,127 25,710 9,388...

  • Page 33
    ...Accounts payable Accrued liabilities Air traffic liability Current portion of long-term debt Total current liabilities Long-term debt, less current portion $ 8,678 68,049 33,765 62,491 172,983 365,412 $ 10,410 57,456 23,491 19,569 110,926 396,119 2000 1999 Commitments and Contingencies Stockholders...

  • Page 34
    ... Shares Balance at December 31, 1997 Issuance of common stock for exercise of options Issuance of common stock under stock purchase plan Net loss and comprehensive loss Balance at December 31, 1998 Issuance of common stock for exercise of options Issuance of common stock under stock purchase plan...

  • Page 35
    ... Accounts payable and accrued liabilities Air traffic liability Net cash provided by (used for) operating activities Investing activities: Purchases of property and equipment (Payment) refund of aircraft purchase deposits Restricted funds for aircraft purchases Proceeds from disposal of equipment...

  • Page 36
    ... related aircraft and engines for spare parts expected to be on hand at the date aircraft are retired from service. Property and Equipment Property and equipment is stated on the basis of cost. Flight equipment is depreciated to its salvage values using the straight-line method. The B717 fleet has...

  • Page 37
    ...less than the carrying amount of cost in excess of net assets acquired, we would record an impairment loss in the period such determination is made, based on the fair value of the related business. Capitalized Interest Interest attributable to funds used to finance the acquisition of new aircraft is...

  • Page 38
    ... used is included in air traffic liability. Stock-Based Compensation We grant stock options for a fixed number of shares to our officers, directors, key employees and consultants, with an exercise price equal to or below the fair value of the shares at the date of grant. We account for stock option...

  • Page 39
    ...adverse effect on our results of operations or financial condition. 3. Fuel Price Risk Management We entered into fuel-hedging contracts consisting of fixed-price swap agreements and collar structures to protect against increases in aircraft fuel prices. The change in market value of such agreements...

  • Page 40
    ... new senior secured notes to be issued by our subsidiary, AirTran Airways, will bear a fixed rate of interest to be determined at closing equal to the sum or difference of 12.25 percent and changes in Boeing Capital's cost of borrowing from and after November 9, 2000, to closing. Principal payments...

  • Page 41
    ... years, and (b) increase Boeing Capital's purchase price by $3.1 million per aircraft or $52.7 million in the aggregate. To date, five of the sale-leaseback transactions have closed in 2001. Upon closing of each sale-leaseback transaction occurring on or after funding of the new senior secured notes...

  • Page 42
    ...): December 31, 2000 Flight equipment Less: Accumulated depreciation $2,627 (111) $2,516 The following schedule outlines the future minimum lease payments at December 31, 2000, under noncancelable operating leases and capital leases with initial terms in excess of one year (in thousands): Capital...

  • Page 43
    ... of weighted average shares outstanding used in computing diluted earnings (loss) per common share. 8. Stock Option Plans The 1993 Incentive Stock Option Plan provides up to 4.8 million options to be granted to officers, directors and key employees to purchase shares of common stock at prices not...

  • Page 44
    Vesting and term of all options is determined by the Board of Directors and may vary by optionee; however, the term may be no longer than ten years from the date of grant. Pro forma information regarding net income (loss) and earnings (loss) per common share is required by SFAS No. 123, which also ...

  • Page 45
    ... Canceled Balance at December 31, 2000 Exercisable at December 31, 2000 The following table summarizes information concerning currently outstanding and exercisable options: Options Outstanding Weighted Average Remaining Contractual Life 2.5 6.0 8.1 6.4 6.0 5.1 5.4 Weighted Average Exercise Price...

  • Page 46
    ... 2000, 1999, and 1998, with option prices less than the market price of the stock on the date of grant. At December 31, 2000, we had reserved a total of 11,982,990 shares of common stock for future issuance, upon exercise of stock options. 9. Income Taxes Our provision for income taxes for the years...

  • Page 47
    ... financial reporting purposes, a valuation allowance has been recognized at December 31, 2000 and 1999, to reduce the net deferred income tax assets to zero. We have not recognized any benefit from the future use of operating loss carryforwards, because management's evaluation of all the available...

  • Page 48
    ... our investment strategy. Concentration of credit risk with respect to accounts receivable is limited, due to the large number of customers comprising our customer base. The fair values of our long-term debt are based on quoted market prices, if available, or are estimated using discounted cash flow...

  • Page 49
    ...During the year, we provide for income taxes using anticipated effective annual tax rates. The rates are based on expected operating results and permanent differences between book and tax income. Adjustments are made each quarter for changes in the anticipated rates used in previous quarters. If the...

  • Page 50
    ..., the consolidated financial position of AirTran Holdings, Inc., at December 31, 2000 and 1999, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2000, in conformity with accounting principles generally accepted in the...

  • Page 51
    ... Houston ( Hobby) New Orleans Ft. Walton Beach Tampa Orlando Grand Bahama Island Ft. Lauderdale Miami Effective May 3, 2001 Ft. Myers We invite your comments about this annual report. Visit us online at airtran.com and click on "Talk to AirTran Airways." Or write to us at: Customer Relations...

  • Page 52
    ... Company Information Headquarters AirTran Holdings, Inc. 9955 AirTran Blvd. Orlando, FL 32827 Officers Joseph B. Leonard Chairman of the Board and Chief Executive Officer Robert L. Fornaro For reservations, book online at airtran.com. Or call your travel agent or 1-800-AIR-TRAN. In Atlanta...