SkyWest Airlines 2014 Annual Report Download - page 61

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Net Income. Primarily due to factors described above, net income increased to $59.0 million, or
$1.12 per diluted share, for the year ended December 31, 2013, compared to $51.2 million, or $0.99 per
diluted share, for the year ended December 31, 2012.
Our Business Segments:
For the year ended December 31, 2013, 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, 2013 and 2012 (in thousands):
2013 2012 $ Change % Change
Amount Amount Amount Percent
Operating Revenues:
SkyWest Airlines operating revenue ............ $1,827,568 $1,930,149 $(102,581) (5.3)%
ExpressJet operating revenues ................ 1,466,341 1,593,527 (127,186) (8.0)%
Other operating revenues .................... 3,816 10,696 (6,880) (64.3)%
Total Operating Revenues ..................... $3,297,725 $3,534,372 $(236,647) (6.7)%
Airline Expenses:
SkyWest airlines expense .................... $1,688,049 $1,824,084 $(136,035) (7.5)%
ExpressJet airlines expense ................... 1,515,336 1,611,982 (96,646) (6.0)%
Other airline expense ....................... 9,887 9,699 188 1.9%
Total Airline Expense(1) ...................... 3,213,272 $3,445,765 $(232,493) (6.7)%
Segment profit (loss):
SkyWest Airlines segment profit ............... $ 139,519 $ 106,065 $ 33,454 31.5%
ExpressJet segment loss ..................... (48,995) (18,455) (30,540) (165.5)%
Other profit (Loss) ........................ (6,071) 997 (7,068) (708.9)%
Total Segment Profit ......................... $ 84,453 $ 88,607 $ (4,154) (4.7)%
Interest Income ............................ 3,689 7,928 (4,239) (53.5)%
Other .................................... 10,390 (10,639) 21,029 (197.7)%
Consolidated Income Before Taxes ............... 98,532 $ 85,896 $ 12,636 14.7%
(1) Total Airline Expense includes operating expense and interest expense
SkyWest Airlines Segment Profit. SkyWest Airlines segment profit increased $33.5 million, or
31.5%, during the year ended December 31, 2013, compared to the year ended December 31, 2012.
The increase in SkyWest Airlines’ segment profit was due primarily to the following factors:
• CRJ200 engine overhaul expense incurred under the SkyWest Airlines Fixed-Rate Engine
Contracts decreased $18.1 million, or 37.6%, during the year ended December 31, 2013,
compared to the year ended December 31, 2012. The decrease in CRJ200 engine overhaul
expense was primarily due to a reduction in the number of scheduled engine maintenance
events.
• SkyWest Airlines’ non-pass-through operating revenue increased by $65.9 million, or 4.6%,
during the year ended December 31, 2013, compared to the year ended December 31, 2012. The
increase in non-pass-through operating revenue, was primarily due to an increase in block hour
production and our receipt of higher incentive payments from SkyWest Airlines’ major airline
partners.
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