SkyWest Airlines 2013 Annual Report Download - page 45

The following terms used in this section and elsewhere in this Report have the meanings indicated
below:
‘‘Revenue passenger miles’’ represents the number of miles flown by revenue passengers.
‘‘Available seat miles’’ represents the number of seats available for passengers multiplied by the
number of miles those seats are flown.
‘‘Revenue per available seat mile’’ represents passenger revenue divided by available seat miles.
‘‘Cost per available seat mile’’ represents operating expenses plus interest divided by available seat
miles.
‘‘Number of operating aircraft at end of year’’ excludes aircraft leased to un-affiliated and affiliated
entities.
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion and analysis presents factors that had a material effect on our results of
operations during the years ended December 31, 2013, 2012 and 2011. Also discussed is our financial
position as of December 31, 2013 and 2012. You should read this discussion in conjunction with our
consolidated financial statements, including the notes thereto, appearing elsewhere in this Report or
incorporated herein by reference. This discussion and analysis contains forward-looking statements. Please
refer to the sections of this Report entitled ‘‘Cautionary Statement Concerning Forward-looking Statements’’
and ‘‘Item 1A. Risk Factors’’ for discussion of some of the uncertainties, risks and assumptions associated
with these statements.
Overview
Through SkyWest Airlines and ExpressJet, we operate the largest regional airline in the United
States. As of December 31, 2013, SkyWest Airlines and ExpressJet offered scheduled passenger and air
freight service with approximately 4,000 total daily departures to destinations in the United States,
Canada, Mexico and the Caribbean. As of December 31, 2013, we had a combined fleet of 757 aircraft
consisting of the following:
CRJ200 ERJ145 ERJ135 CRJ700 CRJ900 EMB120 Total
United ................................. 92 242 9 70 — 36 449
Delta .................................. 125 —— 60 60 9 254
American ............................... 23 —— —— — 23
US Airways .............................. 11 —— — 4 — 15
Alaska ................................. ——— 7—— 7
Subleased to an un-affiliated entity ............. 2 —— —— — 2
Unassigned .............................. 7 —— —— — 7
Total ................................... 260 242 9 137 64 45 757
For the year ended December 31, 2013, approximately 60.9% of our aggregate capacity was
operated for United, approximately 33.6% was operated for Delta, approximately 1.3% was operated
for Alaska, approximately 1.6% was operated for US Airways and approximately 2.6% was operated for
American.
Under a fixed-fee flying arrangement, the major airline generally pays the regional airline a fixed
fee for each departure, with additional incentives based on completion of flights, on-time performance
and baggage handling performance. In addition, the major airline and regional airline often enter into
an arrangement pursuant to which the major airline bears the risk of changes in the price of fuel and
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