SkyWest Airlines 2003 Annual Report Download - page 1

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To our Shareholders
In an environment where challenges abound, I’m proud to report the results and
accomplishments of 2003. We’ve achieved these results in conjunction with a large
expansion into regional jet aircraft. In spite of the challenges we maintained the
integrity of our business model, provided value to our major partners through cost
reductions and increased value to our shareholders. In summarizing the year, let me
highlight some of our most significant achievements and successes.
¾ Added 36 net new 50-seat regional jet aircraft to the fleet
¾ Negotiated a new long-term agreement with United Airlines that was
bankruptcy court approved
¾ Subsequent to year-end, negotiated an understanding with Delta Air Lines for
rates and terms going forward
¾ Maintained an aggressive approach to cost reductions and containment in
order to create value for our major partners and to remain competitive
¾ Reduced cost per available seat mile 11.4% $0.134 per available seat mile
¾ Negotiated a new purchase agreement with Bombardier Aerospace for
additional regional jet aircraft and subsequent to year-end, increased the
number of aircraft on firm order
¾ Added Continental Airlines as an additional code-sharing partner
¾ Financed all aircraft deliveries with long-term permanent lease or long-term
debt and had no aircraft under interim financing arrangements at year-end
I’m also happy to report that we were recently recognized for our outstanding quality
wherein the U.S. Department of Transportation Air Travel Consumer Report named
SkyWest Airlines as the number 1 carrier for on-time performance for calendar 2003.
We added 36 net new 50-seat regional jet aircraft during the year. As a result, our
total operating revenues increased 14.7% to $888.0 million. Additionally, our net
income was $66.8 million or $1.15 per diluted share. By adding these aircraft to our
fleet our available seat miles increased 34.9% and passengers carried increased
28.0%.
During the year we announced that we had completed negotiations and signed a long-
term, 11 year definitive contract with United Airlines. The agreement has been
approved by the U.S. Bankruptcy Court, on United’s behalf, and has received all
necessary approvals from the creditors committee and United’s pilot union. The
agreement was significant in that it strongly reaffirmed our business relationship with
United Airlines, it demonstrated to the markets that our operating costs are among the
lowest in the industry and it provides us with the opportunity for continued growth in
our regional jet operations.
Subsequent to year-end we negotiated an understanding with Delta Air Lines for
contract extension, multiple year rate resets and other improvements to the terms and

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