SkyWest Airlines 2015 Annual Report Download - page 126

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24
COMPENSATION DISCUSSION AND ANALYSIS
The following narrative compensation discussion and analysis provides information regarding the Company’s
executive compensation objectives, principles, practices and decisions as they relate to the following named executive
officers of the Company (the “Executives”):
• Jerry C. Atkin, Chairman of the Board and former Chief Executive Officer of the Company, SkyWest
Airlines and ExpressJet (the “Chief Executive” for fiscal year 2015);
• Russell A. Childs, Chief Executive Officer and President of the Company, SkyWest Airlines and
ExpressJet;
• Robert J. Simmons, Chief Financial Officer of the Company, SkyWest Airlines and ExpressJet;
• Wade J. Steel, Chief Commercial Officer and for portions of fiscal year 2015, Acting Chief Financial
Officer of the Company, SkyWest Airlines and ExpressJet;
• Michael B. Thompson, Chief Operating Officer of SkyWest Airlines; and
• Terry M. Vais, Chief Operating Officer of ExpressJet.
The compensation discussion and analysis provides narrative perspective to the tables and disclosure in the
tables following this section.
Current Year Accomplishments
The Company’s income before income taxes improved to $194 million in 2015, from a loss before income taxes
of $16 million in 2014. Operating income improved to $234 million in 2015, from $25 million in 2014. The 2014
results included a $75 million pre-tax special items operating expense primarily related to fleet reductions. Such
improvement was driven, in part, by the following accomplishments:
• The improvement in fleet mix, which included a net reduction in the total number of aircraft available for
service from 717 aircraft at December 31, 2014 to 660 at December 31, 2015, summarized as follows:
o Added 25 new Embraer E175 aircraft under flying contracts with improved profitability;
o Added 21 used 50-seat aircraft under flying contracts with improved profitability;
o Removed 76 50-seat aircraft from unprofitable or less profitable flying contracts;
o Removed the remaining less profitable 27 Embraer EMB-120 turboprop from its operations;
• SkyWest Airlines’ and ExpressJet’s improved operational performance resulted in additional flying
contract performance incentives earned;
• The Company continued to improve the profitability of its pro-rate operations; and
• The Company worked with its major airline partners to reduce scheduled operations at specific hubs to
improve operational efficiencies.