JetBlue Airlines 2011 Annual Report Download - page 54

the effect on our business might be from the extremely competitive environment we are operating in or from
events that are beyond our control, such as volatile fuel prices, economic conditions, weather-related disruptions,
the impact of airline bankruptcies, restructurings or consolidations, U.S. military actions or acts of terrorism. We
believe the working capital available to us will be sufficient to meet our cash requirements for at least the next
12 months.
Our scheduled debt maturities are expected to increase over the next five years, with a scheduled peak in
2014 of nearly $600 million. We are actively managing our liquidity to overcome these debt hurdles by pre-
purchasing convertible debt and other outstanding debt when market conditions allow. In doing so, we are
working to smooth the scheduled debt maturity schedule over the next five years, which will also have the effect
of reducing overall interest expense.
Anticipated capital expenditures for facility improvements, spare parts and ground purchases in 2012 are
projected to be approximately $215 million.
Contractual Obligations
Our noncancelable contractual obligations at December 31, 2011 include (in millions):
Payments due in
Total 2012 2013 2014 2015 2016 Thereafter
Long-term debt and capital lease
obligations (1) ................. $ 3,752 $ 324 $ 514 $ 675 $ 347 $ 531 $1,361
Lease commitments ............... 1,578 205 176 171 172 107 747
Flight equipment obligations ........ 5,960 425 450 580 775 785 2,945
Short-term borrowings ............. 88 88———— —
Financing obligations and other (2) . . . 2,997 306 268 223 238 307 1,655
Total ........................... $14,375 $1,348 $1,408 $1,649 $1,532 $1,730 $6,708
(1) Includes actual interest and estimated interest for floating-rate debt based on December 31, 2011 rates.
(2) Amounts include noncancelable commitments for the purchase of goods and services.
The interest rates are fixed for $1.62 billion of our debt and capital lease obligations, with the remaining
$1.43 billion having floating interest rates. The floating interest rates adjust quarterly or semi-annually based on
the London Interbank Offered Rate, or LIBOR. The weighted average maturity of all of our debt was seven years
at December 31, 2011. We are subject to certain financial ratios for our unsecured line of credit issued in
September 2011, including a requirement to maintain certain cash and short-term investment levels and a
minimum earnings before income taxes, interest, depreciation and amortization, or EBITDA margin, as well as
customary events of default. We are subject to certain collateral ratio requirements in our spare parts pass-
through certificates and spare engine financing issued in November 2006 and December 2007, respectively. If we
fail to maintain these collateral ratios, we are required to provide additional collateral or redeem some or all of
the equipment notes so that the ratios return to compliance. As a result of lower spare parts inventory balances
and the associated reduced third party valuation of these parts, we pledged as collateral a previously
unencumbered spare engine with a carrying value of approximately $7 million during the second quarter of 2011.
During the third quarter of 2011, we did not meet the minimum ratios on our spare parts pass-through certificates
due to the reduced third party valuation of these parts. In order to maintain the ratios, we elected to redeem $3
million of the equipment notes to be settled in November 2011. At December 31, 2011, we were in compliance
with all covenants of our debt and lease agreements and 75% of our owned property and equipment were pledged
as security under various loan agreements.
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