SkyWest Airlines 2008 Annual Report Download - page 63

SKYWEST, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2008
(1) Nature of Operations and Summary of Significant Accounting Policies
SkyWest, Inc. (the ‘‘Company’’), through its wholly-owned subsidiaries, SkyWest Airlines, Inc.
(‘‘SkyWest Airlines’’) and Atlantic Southeast Airlines, Inc. (‘‘ASA’’), operates the largest regional airline
in the United States. As of December 31, 2008, SkyWest and ASA offered scheduled passenger and air
freight service with approximately 2,300 total daily departures to 218 different destinations in the
United States, Canada, Mexico and the Caribbean. Additionally, the Company provides ground
handling services for approximately eight other airlines throughout its system. As of December 31,
2008, the Company operated a fleet of 442 aircraft consisting of 250 50-seat Bombardier CRJ200
Regional Jet aircraft (‘‘CRJ200s’’) (67 assigned to United Air Lines, Inc. (‘‘United’’), 162 assigned to
Delta Air Lines, Inc. (‘‘Delta’’), 12 assigned to Midwest Airlines, Inc. (‘‘Midwest’’) and nine used by
SkyWest Airlines as additional maintenance spare aircraft) 104 70-seat Bombardier CRJ 700 Regional
Jet aircraft (‘‘CRJ700s’’) (52 assigned to United and 52 assigned to Delta), 20 70-90-seat Bombardier
CRJ900 Regional Jet aircraft (‘‘CRJ900’’) (all assigned to Delta), 56 Embraer Brasilia EMB-120
turboprops (‘‘Brasilia Turboprops’’) (44 assigned to United and 12 assigned to Delta), and 12 Avions de
Transport 72-210 (‘‘ATR-72 turboprops’’) (all assigned to Delta). As of December 31, 2008, the 12
ATR-72 turboprops were no longer in revenue service, and ASA expects to return the aircraft to the
lessor by February 28, 2009. For the year ended December 31, 2008, approximately 56.3% of the
Company’s capacity was operated under the Delta code, approximately 40.3% was operated under the
United code and approximately 3.4% was operated under the Midwest code.
SkyWest Airlines has been a partner with Delta in Salt Lake City and United in Los Angeles since
1987 and 1997, respectively. In 1998, SkyWest Airlines expanded its relationship with United to provide
service in Portland, Seattle/Tacoma, San Francisco and additional Los Angeles markets. In 2004,
SkyWest Airlines expanded its United Express operations to provide service in Chicago. In December
2006, SkyWest Airlines and Midwest entered into an Airline Services Agreement (the ‘‘Midwest
Services Agreement’’). SkyWest Airlines serves markets from Midwest’s hub in Milwaukee. As of
December 31, 2008, SkyWest Airlines operated as a Delta Connection carrier in Salt Lake City, a
United Express carrier in Los Angeles, San Francisco, Denver, Chicago and the Pacific Northwest, and
a Midwest Connect carrier in Milwaukee operating more than 1,500 total daily flights.
ASA has been a code-share partner with Delta in Atlanta since 1984. ASA expanded its operations
as a Delta Connection carrier to also include Cincinnati and Salt Lake City in September 2002 and
April 2003, respectively. ASA operates approximately 775 daily flights, all in the Delta Connection
system.
Basis of Presentation
The Company’s consolidated financial statements include the accounts of SkyWest, Inc. and its
wholly-owned subsidiaries, SkyWest Airlines and ASA, with all inter-company transactions and balances
having been eliminated.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted
in the United States of America requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the
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