Spirit Airlines 2015 Annual Report Download - page 53

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53
Other (income) expense, net
2015 compared to 2014
Other (income) expense, net increased from $2.3 million in 2014 to $6.7 million in 2015. This increase was primarily
driven by an increase in interest expense of $17.6 million, which primarily represented interest related to the financing of
purchased aircraft, offset by an increase in the capitalization of interest of $8.8 million. Additionally, interest income increased
by $1.8 million, year over year, as we earned interest income on funds required to be held in escrow in accordance with the
terms of our EETC. See “Notes to the Financial Statements—9. Debt and Other Obligations” for additional information.
2014 compared to 2013
Other (income) expense, net decreased from $(0.1) million in 2013 to $2.3 million in 2014. The decrease was primarily
driven by a $7.0 million payment made to the Stockholder Representatives in accordance with the TRA of which $1.4 million
was in excess of the amount previously accrued and was recorded within other (income) expense in the statement of operations.
See “Notes to the Financial Statements—17. Tax Receivable Agreement” for additional information. In addition, we made a
charitable contribution of $1.0 million that is specifically creditable against current income tax in the State of Florida, as
allowed under state law, and recorded within other expense in the statements of operations.
Income Taxes
In 2015, our effective tax rate was 36.9% compared to 36.1% in 2014 and 37.4% in 2013. While we expect our tax rate to
be fairly consistent in the near term, it will tend to vary depending on recurring items such as the amount of income we earn in
each state and the state tax rate applicable to such income. Discrete items particular to a given year may also affect our effective
tax rates.