Alaska Airlines and Horizon Air 2013 Annual Report Download - page 167

The following table summarizes information about outstanding stock awards:
Number of
Units
Weighted-
Average
Grant
Date Fair
Value
Weighted-
Average
Contractual
Life (Years)
Aggregate
Intrinsic
Value
(in millions)
Non-vested, December 31, 2012 ................. 754,293 $28.06 0.6 $33
Granted ..................................... 208,110 49.10
Vested ...................................... (314,828) 19.29
Forfeited .................................... (8,360) 33.66
Non-vested, December 31, 2013 ................. 639,215 $39.15 0.6 $47
Deferred Stock Awards
Deferred Stock Units (DSUs) are awarded to
members of its Board of Directors as part of
their retainers. The underlying common shares
are issued upon retirement from the Board, but
require no future service period. As a result, the
entire intrinsic value of the awards is expensed
on the date of grant.
Employee Stock Purchase Plan (ESPP)
The ESPP allows employees to purchase
common stock at 85% of the stock price on the
first day of the offering period or the specified
purchase date, whichever is lower. Employees
may contribute up to 10% of their base earnings
during the offering period to purchase stock.
Employees purchased 171,227, 157,373, and
125,564 shares in 2013, 2012, and 2011
under the ESPP.
NOTE 12. OPERATING SEGMENT INFORMATION
Air Group has two operating airlines—Alaska
Airlines and Horizon Air. Each is a regulated
airline with separate management teams. To
manage the two operating airlines and the
revenues and expenses associated with the
CPAs, management views the business in three
operating segments.
Alaska Mainline—The Boeing 737 part of
Alaska's business.
Alaska Regional—Alaska’s shorter distance
network. In this segment, Alaska Regional
records actual on board passenger revenue,
less costs such as fuel, distribution costs,
and payments made to Horizon, SkyWest
and PenAir under CPAs. Additionally, Alaska
Regional includes a small allocation of
corporate overhead such as IT, finance and
other administrative costs incurred by
Alaska and on behalf of Horizon.
Horizon—Horizon operates regional aircraft.
All of Horizon's capacity is sold to Alaska
under a CPA. Expenses included those
typically borne by regional airlines such as
crew costs, ownership costs, and
maintenance costs.
Additionally, the following table reports “Air
Group adjusted”, which is not a measure
determined in accordance with GAAP. The
Company's chief operating decision-makers and
others in management use this measure to
evaluate operational performance and determine
resources allocations. Adjustments are further
explained below in reconciling to consolidated
GAAP results.
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ŠForm 10-K