SkyWest Airlines 2014 Annual Report Download - page 55

Summary of other income (expense) items and provision for income taxes:
Other Income (expense), net. Other income (expense) for the 2014 year includes a gain of
$24.9 million resulting from the sale of our ownership in TRIP stock, offset by losses from the sale of
assets during 2014. Other income (expense) for the year ended December 31, 2014 primarily consisted
of $10.1 million associated with our sale of stock in Mekong Aviation Joint Stock Company, an airline
operating in Vietnam (‘‘Air Mekong’’), and recognition of maintenance deposit we collected associated
with the aircraft sub-leases we terminated with Air Mekong.
Provision for income taxes. The income tax provision for the 2014 year included a valuation
allowance of $6.0 million for previously generated state net operating loss benefits specific to
ExpressJet that we anticipate to expire, $2.0 million of foreign income tax associated with our sale of
ownership in TRIP stock, and the write-off of $2.4 million of tax assets associated with the sale of our
paint facility located in Saltillo, Mexico during 2014. These discrete income tax provision items were
partially offset by the income tax benefit associated with our loss before income tax of $16.3 million for
2014.
Net Income (loss). Primarily due to factors described above, we generated a net loss of
$24.2 million, or $(0.47) per diluted share, for the year ended December 31, 2014, compared to net
income of $59.0 million, or $1.12 per diluted share, for the year ended December 31, 2013.
Our Business Segments:
For the year ended December 31, 2014, we had two reportable segments which are the basis of our
internal financial reporting: SkyWest Airlines and ExpressJet. The following table sets forth our
segment data for the years ended December 31, 2014 and 2013 (in thousands):
2014 2013 $ Change % Change
Amount Amount Amount Percent
Operating Revenues:
SkyWest Airlines operating revenue ............ $1,888,693 $1,827,568 $ 61,125 3.3%
ExpressJet operating revenues ................ 1,346,859 1,466,341 (119,482) (8.1)%
Other operating revenues .................... 1,895 3,816 (1,921) (50.3)%
Total Operating Revenues ..................... $3,237,447 $3,297,725 $ (60,278) (1.8)%
Airline Expenses:
SkyWest Airlines airline expense ............... $1,811,054 $1,688,049 $ 123,005 7.3%
ExpressJet airlines expense ................... 1,464,804 1,515,336 (50,532) (3.3)%
Other airline expense ....................... 2,736 9,887 (7,151) (72.3)%
Total Airline Expense(1) ...................... $3,278,594 $3,213,272 $ 65,322 2.0%
Segment profit (loss):
SkyWest Airlines segment profit ............... $ 77,639 $ 139,519 $ (61,880) (44.4)%
ExpressJet segment loss ..................... (117,945) (48,995) (68,950) 140.7%
Other profit (Loss) ........................ (841) (6,071) 5,230 (86.1)%
Total Segment Profit (Loss) .................... $ (41,147) $ 84,453 $(125,600) (148.7)%
Interest Income ............................ 4,096 3,689 407 11.0%
Other Income (Expense), net ................... 20,708 10,390 10,318 99.3%
Consolidated Income (Loss) Before Taxes .......... $ (16,343) $ 98,532 $(114,875) (116.6)%
(1) Total Airline Expense includes operating expense and interest expense
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