Westjet 2014 Annual Report Download - page 52

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WestJet Annual Report 2014│50
Adjusted debt-to-equity
($ in thousands)
2014
2013
Change
Long-term debt(i) 1,188,663 878,395 310,268
Off-balance-sheet aircraft leases
(ii)
1,368,375
1,317,345
51,030
Adjusted debt
2,557,038
2,195,740
361,298
Total shareholders’ equity 1,777,502 1,589,840 187,662
Add: Hedge reserves
3,179
(105)
3,284
Adjusted equity
1,780,681
1,589,735
190,946
Adjusted debt-to-equity 1.44 1.38 4.3%
(i) At December 31, 2014, long-term debt includes the current portion of long-term debt of $159,843 (2013 – $189,191) and long-term debt of $1,028,820
(2013 – $689,204).
(ii) Off-balance-sheet aircraft leases are calculated by multiplying the trailing 12 months of aircraft leasing expense by 7.5. At December 31, 2014, the trailing 12
months of aircraft leasing costs totaled $182,450 (2013 – $175,646).
Adjusted net debt to EBITDAR/Adjusted net debt to adjusted EBITDAR
($ in thousands) 2014 2013 Change
Adjusted debt
2,557,038 2,195,740 361,298
Less: Cash and cash equivalents (1,358,071) (1,256,005) (102,066)
Adjusted net debt
1,198,967
939,735
259,232
Net earnings 283,957 268,722 15,235
Add:
Net finance costs(i)
34,768 25,599 9,169
Taxes 106,350 103,363 2,987
Depreciation and amortization 226,740 200,840 25,900
Aircraft leasing 182,450 175,646 6,804
Other(ii)
2,064 (1,136) 3,200
EBITDAR 836,329 773,034 63,295
Special item(iii)
45,459 ― 45,459
Adjusted EBITDAR 881,788 773,034 108,754
Adjusted net debt to EBITDAR(iv) 1.43 1.22 17.2%
Adjusted net debt to adjusted EBITDAR
(iv)
1.36 1.22 11.9%
(i) At December 31, 2014, net finance costs includes the trailing 12 months of finance income of $17,070 (2013 – $17,848) and the trailing 12 months of finance
cost of $51,838 (2013 – $43,447).
(ii) At December 31, 2014, other includes the trailing 12 months foreign exchange loss of $2,064 (2013 – gain of $1,136).
(iii) Pre-tax non-cash loss recorded in the third quarter of 2014 associated with the sale of 10 aircraft to Southwest.
(iv) At December 31, 2014 and December 31, 2013, the Corporation met its internal guideline of an adjusted net debt to EBITDAR and an adjusted net debt to
adjusted EBITDAR measure of less than 2.50.
Return on invested capital
($ in thousands) 2014 2013 Change
Earnings before income taxes (trailing twelve months) 390,307 372,085 18,222
Special item(i)
45,459 ― 45,459
Adjusted earnings before income taxes (trailing twelve months)
435,766 372,085 63,681
Add:
Finance costs 51,838 43,447 8,391
Implicit interest in operating leases
(ii)
95,786
92,214
3,572
Return 583,390 507,746 75,644
Invested capital:
Average long-term debt(iii) 1,033,529 808,722 224,807
Average shareholders' equity 1,683,671 1,531,072 152,599
Off-balance-sheet aircraft leases(iv) 1,368,375 1,317,345 51,030
Invested capital 4,085,575 3,657,139 428,436
Return on invested capital 14.3% 13.9% 0.4 pts.
(i) Pre-tax non-cash loss recorded in the third quarter of 2014 associated with the sale of 10 aircraft to Southwest.
(ii) Interest implicit in operating leases is equal to 7.0 per cent of 7.5 times the trailing 12 months of aircraft lease expense. 7.0 per cent is a proxy and does not
necessarily represent actual for any given period.
(iii) Average long-term debt includes the current portion and long-term portion.