Alaska Airlines and Horizon Air 2010 Annual Report Download - page 194

The following table displays the activity and
balance of the severance and related cost
components of the Company’s restructuring
accrual as of and for the years ended
December 31, 2009 and 2008 (in millions):
Accrual for Severance and Related Costs 2009 2008
Balance at beginning of year ...... $ 7.2 $ 0.7
Restructuring charges and
adjustments ................. —12.9
Cash payments ................ (7.2) (6.4)
Balance at end of year ........... $— $ 7.2
Alaska Transition to All-Boeing 737 Fleet
In March 2006, the Company’s Board of
Directors approved a plan to accelerate the
retirement of its MD-80 fleet (15 owned and 11
leased aircraft at the time) and remove those
aircraft from service by the end of 2008. As a
result, the Company recorded a $47.5 million
charge in 2008 reflecting the remaining
discounted future lease payments and other
contract-related costs associated with the
removal of the remaining MD-80 aircraft from
operations. All MD-80 lease arrangements have
been terminated and the Company no longer has
any related obligation.
NOTE 8. NEW PILOT CONTRACT TRANSITION COSTS
On May 19, 2009, Alaska announced that its
pilots, represented by the Air Line Pilots
Association, ratified a new four-year
contract. Among other items, the contract has a
provision that allows for pilots to receive, at
retirement, a cash payment equal to 25% of their
accrued sick leave balance multiplied by their
hourly rate. The transition expense associated
with establishing this sick-leave payout program
was $15.5 million. Pilots also received a
one-time cash bonus following ratification of the
contract of $20.3 million in the aggregate. These
items have been combined and reported as
“New pilot contract transition costs” in the
consolidated statements of operations.
NOTE 9. DETAIL OF OTHER FINANCIAL STATEMENT CAPTIONS
Receivables
Receivables consisted of the following at
December 31 (in millions):
2010 2009
Airline traffic receivables .... $ 53.6 $ 55.2
Mileage Plan receivables .... 37.9 31.9
Receivables from fuel-hedging
counterparties ........... 5.5 1.1
Other receivables .......... 24.0 25.1
Allowance for doubtful
accounts ............... (0.9) (1.5)
$120.1 $111.8
Prepaid Expenses and Other Current Assets
Prepaid expenses and other current assets
consisted of the following at December 31 (in
millions):
2010 2009
Prepaid aircraft rent ......... $ 42.5 $47.9
Prepaid fuel ................ 12.6 10.8
Prepaid engine maintenance . . 28.7 13.3
Other ..................... 22.9 26.1
$106.7 $98.1
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