Frontier Airlines 2005 Annual Report Download - page 58

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2004, 97.6% of our ASMs and 96.0% of our passenger revenues were generated under fixed-fee agreements. During 2005, 100% of
our ASMs and passenger revenues were generated under fixed-fee agreements. The shift to fixed-fee flying has reduced our exposure
to fluctuations in fuel prices, fare competition and passenger volumes. As of December 31, 2005, we operated 138 Embraer regional
jets for four code-share partners under fixed-fee agreements.
Revenue
Under our fixed-fee arrangements with American, Delta, US Airways and United for regional jets, we receive a fixed-fee, as
well as reimbursement of specified costs on a gross basis with additional possible incentives from our partners for superior
performance. Under our previous pro-rate revenue sharing agreement with US Airways for turboprop aircraft, we received a
negotiated portion of ticket revenue. As of December 31, 2003, 2004 and 2005 approximately 91.0%, 96.0% and 100%, respectively,
of our passenger revenue was earned under our fixed-fee arrangements. Because all of our passenger revenue is now derived from
these fixed-fee arrangements, the number of aircraft we operate, as opposed to the number of passengers that we carry, will have the
largest impact on our revenues.
Operating Expenses
A brief description of the items included in our operating expenses line items follows.
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Source: REPUBLIC AIRWAYS HOLDINGS INC, 10-K, February 27, 2006 Powered by Morningstar® Document Research℠