Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2014 | Oct. 29, 2014 | |
Entity Registrant Name | 'REPUBLIC AIRWAYS HOLDINGS INC | ' |
Entity Central Index Key | '0001159154 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Amendment Flag | 'false | ' |
Entity Common Stock, Shares Outstanding | ' | 49,786,619 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Current Assets: | ' | ' |
Cash and cash equivalents | $257.70 | $276.70 |
Restricted cash | 25.8 | 24 |
Receivables—net of allowance for doubtful accounts of $2.8 and $1.5, respectively | 18.3 | 48.3 |
Inventories | 64.6 | 71.9 |
Prepaid expenses and other current assets | 15.9 | 17.7 |
Deferred income taxes | 16.3 | 15.7 |
Total current assets | 398.6 | 454.3 |
Aircraft and other equipment, net | 2,841.40 | 2,563.60 |
Maintenance deposits | 51 | 36.6 |
Other Assets | 228.1 | 216.8 |
Total assets | 3,519.10 | 3,271.30 |
Current Liabilities: | ' | ' |
Current portion of long-term debt | 313.5 | 276.2 |
Accounts payable | 18.1 | 28.9 |
Accrued liabilities | 161.5 | 163.8 |
Total current liabilities | 493.1 | 468.9 |
Long-term debt—less current portion | 2,032.30 | 1,890.60 |
Deferred credits and other non-current liabilities | 92.1 | 100.7 |
Deferred income taxes | 295.5 | 260.4 |
Total liabilities | 2,913 | 2,720.60 |
Commitments and contingencies | ' | ' |
Stockholders' Equity: | ' | ' |
Preferred stock, $.001 par value; 5,000,000 shares authorized; no shares issued or outstanding | 0 | 0 |
Common stock, $.001 par value; one vote per share; 150,000,000 shares authorized; 59,584,332 and 59,704,943 shares issued and 49,786,619 and 49,525,594 shares outstanding, respectively | 0 | 0 |
Additional Paid in Capital | 425 | 420.2 |
Treasury stock, 9,546,147 and 9,333,266 shares at cost | -184 | -181.8 |
Accumulated other comprehensive loss | -2.4 | -2.6 |
Accumulated Earnings | 367.5 | 314.9 |
Total stockholders' equity | 606.1 | 550.7 |
Total liabilities and stockholders' equity | $3,519.10 | $3,271.30 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Millions, except Share data, unless otherwise specified | ||
Allowance for Doubtful Accounts Receivable, Current | $2.80 | $1.50 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 59,584,332 | 59,704,943 |
Common stock, shares outstanding | 49,786,619 | 49,525,594 |
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Treasury Stock | 9,546,147 | 9,333,266 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
OPERATING REVENUES: | ' | ' | ' | ' |
Fixed-Fee Service Revenue | $343.70 | $320.30 | $1,009.20 | $941.20 |
Passenger Service | 0 | 12.6 | 0 | 41.6 |
Charter and Other | 6 | 5.7 | 21 | 17.2 |
Total operating revenues | 349.7 | 338.6 | 1,030.20 | 1,000 |
OPERATING EXPENSES: | ' | ' | ' | ' |
Wages and benefits | 93.8 | 87.1 | 274.8 | 256.6 |
Aircraft fuel | 5.1 | 11.3 | 18 | 37.1 |
Landings Fees and Airport Rents | 7 | 7.9 | 20.8 | 38.3 |
Aircraft and Engine Rent | 31.9 | 32 | 94.3 | 91.6 |
Maintenance and Repairs | 65.9 | 67.3 | 191.9 | 184 |
Insurance and taxes | 5 | 6.5 | 15.9 | 18.5 |
Depreciation and amortization | 43.7 | 37 | 127.2 | 110.5 |
Other Impairment Charges | 0 | 21.2 | 19.9 | 21.2 |
Other | 36.5 | 35.5 | 109.4 | 107.5 |
Total operating expenses | 288.9 | 305.8 | 872.2 | 865.3 |
OPERATING INCOME | 60.8 | 32.8 | 158 | 134.7 |
OTHER INCOME (EXPENSE): | ' | ' | ' | ' |
Interest expense | -30.4 | -27.4 | -90 | -83.1 |
Fair Value Gain - restructuring asset | 0 | 0 | 18.4 | 0 |
Other, net | 0.1 | 0 | 0.2 | 0.1 |
Total other expense | -30.3 | -27.4 | -71.4 | -83 |
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 30.5 | 5.4 | 86.6 | 51.7 |
INCOME TAX EXPENSE | 12 | 1.1 | 34 | 19.9 |
INCOME FROM CONTINUING OPERATIONS | 18.5 | 4.3 | 52.6 | 31.8 |
Income from discontinued operations, net of tax | 0 | 29.8 | 0 | 27.2 |
Loss from disposal of discontinued operations, net of tax | 0 | -47.9 | 0 | -47.9 |
Loss from discontinued operations, net of tax | 0 | -18.1 | 0 | -20.7 |
NET INCOME (LOSS) | $18.50 | ($13.80) | $52.60 | $11.10 |
Income from Continuing Operations, Per Common Share - Basic | $0.37 | $0.09 | $1.06 | $0.64 |
Income from Continuing Operations Per Common Share - Diluted | $0.35 | $0.09 | $1.01 | $0.60 |
NET INCOME (LOSS) PER COMMON SHARE - BASIC | $0.37 | ($0.28) | $1.06 | $0.22 |
NET INCOME (LOSS) PER COMMON SHARE - DILUTED | $0.35 | ($0.26) | $1.01 | $0.23 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive Income (Loss) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
NET INCOME (LOSS) | $18.50 | ($13.80) | $52.60 | $11.10 |
Other Comprehensive Income, net, Reclassification adjustment for loss realized on derivatives, net of tax | 0.1 | 0 | 0.2 | 0.1 |
Total comprehensive income (loss), net | $18.60 | ($13.80) | $52.80 | $11.20 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Net Cash From Operating Activities, Continuing Operations | $259.40 | $170 |
INVESTING ACTIVITIES: | ' | ' |
Purchase of aircraft and other equipment | -445.6 | -233.4 |
Proceeds from Sale of Other Assets | 8.6 | 40.1 |
Aircraft Deposits | -20 | -25 |
Change in Restricted Cash | -1.8 | -2.4 |
Net Cash Used In Investing Activities of Continuing Operations | -458.8 | -220.7 |
FINANCING ACTIVITIES: | ' | ' |
Payments on Debt | -213.2 | -147.9 |
Proceeds from debt issuance and refinancing | 397.1 | 236.8 |
Payments on early extinguishment of debt and refinancing | 0 | -58.7 |
Proceeds from Stock Options Exercised | 1.3 | 3.9 |
Payments for Repurchase of Common Stock (Treasury Stock) | -2.1 | 0 |
Other, net | -2.7 | -2.3 |
Net Cash From Financing Activities of Continuing Operations | 180.4 | 31.8 |
Cash From Operating Activities, Discontinued Operations | 0 | 66.4 |
Cash From Investing Activities, Discontinued Operations | 0 | -8 |
Cash From Financing Activities, Discontinued Operations | 0 | -31 |
Less net cash from discontinued operations | 0 | 27.4 |
Net Cash From Discontinued Operations | 0 | 0 |
NET CHANGES IN CASH AND CASH EQUIVALENTS | -19 | -18.9 |
Cash and Cash Equivalents, at Carrying Value, Including Discontinued Operations - Beginning | 276.7 | 210.8 |
Cash and Cash Equivalents, at Carrying Value, Including Discontinued Operations - End | 257.7 | 191.9 |
CASH PAID FOR INTEREST AND INCOME TAXES [Abstract] | ' | ' |
Interest paid | 81.6 | 86.4 |
Income taxes paid | 2 | 0.6 |
Noncash Investing and Financing Items [Abstract] | ' | ' |
other equipment acquired through manufacturer credits | 17.4 | 0 |
Manufacturer credit applied to the purchase of aircraft | 21.2 | 0 |
engines received and not yet paid | 0 | 5.8 |
Aircraft Parts Financed | 0 | 42.8 |
Chautauqua restructuring asset - Aircraft Manufacturer's Incentive | $0 | $12 |
Organization_and_Business
Organization and Business | 9 Months Ended |
Sep. 30, 2014 | |
Organization and Business [Abstract] | ' |
Nature of Operations [Text Block] | ' |
Organization and Business | |
We are a Delaware holding company organized in 1996 that offers scheduled passenger services through our wholly-owned operating air carrier subsidiaries: Chautauqua Airlines, Inc. ("Chautauqua"), Shuttle America Corporation ("Shuttle"), and Republic Airline Inc. ("Republic Airline"). Unless the context indicates otherwise, the terms the "Company," "we," "us," or "our" refer to Republic Airways Holdings Inc. and our subsidiaries. | |
In the opinion of management, these financial statements reflect all adjustments that are necessary to present fairly the results of operations for the interim periods presented. All adjustments are of a normal, recurring nature unless otherwise disclosed. The results of operations for the three and nine months ended September 30, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. These financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013, filed March 11, 2014. | |
Unless otherwise indicated, information in these notes to condensed consolidated financial statements relates to continuing operations. Certain of our operations have been presented as discontinued. See note 5. |
Significant_Accounting_Policie
Significant Accounting Policies | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Summary Of Significant Accounting Policies [Abstract] | ' | ||||||||||||||||
Significant Accounting Policies [Text Block] | ' | ||||||||||||||||
Summary of Significant Accounting Policies | |||||||||||||||||
Rental Income – Under the Company’s fixed-fee code-share and fixed-fee charter agreements, the Company is reimbursed an amount per aircraft designed to compensate the Company for certain aircraft ownership costs. The Company has concluded that a component of its fixed-fee service revenue under the agreements discussed above is rental income, inasmuch as the agreements identify the “right of use” of a specific type and number of aircraft over a stated period of time. The amounts deemed to be rental income during the three months ended September 30, 2014 and 2013, were $108.9 million and $97.2 million, respectively. The amounts deemed to be rental income during the nine months ended September 30, 2014 and 2013 were $322.0 million and $284.3 million, respectively, and have been included in fixed-fee service revenues in the Company’s condensed consolidated statements of operations. | |||||||||||||||||
Charter and Other Revenue – Charter and other revenue primarily consists of lease revenue for aircraft subleased under operating leases and miscellaneous revenue related to charter flying. Charter revenues are recognized at the point that our charter service is realizable and earned, which is when the transportation is provided. All other revenue is recognized as revenue when the related goods and services are provided. | |||||||||||||||||
Restricted Cash – Restricted cash primarily consists of balances in escrow for our long-term charter agreement, restricted amounts for satisfying debt and lease payments due within the next year and certificates of deposit that secure certain letters of credit issued for workers' compensation claim reserves and certain airport authorities. Restricted cash is carried at cost, which management believes approximates fair value. | |||||||||||||||||
Stockholders’ Equity – For the period from December 31, 2013 through September 30, 2014, additional paid-in capital increased to $425.0 million from $420.2 million due to $3.5 million of stock compensation expense and $1.3 million of proceeds for options exercised, accumulated other comprehensive loss decreased to $2.4 million from $2.6 million due to the reclassification adjustment for loss realized on derivatives, and accumulated earnings increased to $367.5 million from $314.9 million based on current year to date net income. | |||||||||||||||||
On April 7, 2014, the Company's Board of Directors authorized management to utilize up to $75 million to buy back shares and/or early retire convertible debt during the next twelve months. The Company may repurchase up to $50 million of common shares and retire up to $50 million of convertible notes, or any combination thereof. During the nine months ended September 30, 2014, pursuant to this authorization, the Company purchased 212,881 shares of its common stock on the open market at a weighted average price per share of $9.98 for total consideration of $2.1 million. | |||||||||||||||||
Net Income (Loss) Per Common Share – The following table is based on the weighted average number of common shares outstanding during the period. The following is a reconciliation of the weighted average common shares for the basic and diluted per share computations (in millions, except per share information): | |||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Basic and diluted income per share: | |||||||||||||||||
Income from continuing operations | $ | 18.5 | $ | 4.3 | $ | 52.6 | $ | 31.8 | |||||||||
Loss from discontinued operations, net of tax | — | (18.1 | ) | — | (20.7 | ) | |||||||||||
Net income (loss) | 18.5 | (13.8 | ) | 52.6 | 11.1 | ||||||||||||
Income effect of assumed-conversion interest on convertible debt | 0.3 | 0.2 | 0.8 | 1.5 | |||||||||||||
Income (loss) after assumed conversion | $ | 18.8 | $ | (13.6 | ) | $ | 53.4 | $ | 12.6 | ||||||||
Weighted average common shares outstanding | 49.9 | 49.4 | 49.8 | 49.8 | |||||||||||||
Effect of dilutive securities: | |||||||||||||||||
Stock options and restricted stock | 0.3 | 0.6 | 0.4 | 0.6 | |||||||||||||
Convertible debt | 2.8 | 2.5 | 2.8 | 4.7 | |||||||||||||
Shares used to compute diluted earnings per share | 53 | 52.5 | 53 | 55.1 | |||||||||||||
Income per share - basic: | |||||||||||||||||
Income from continuing operations | $ | 0.37 | $ | 0.09 | $ | 1.06 | $ | 0.64 | |||||||||
Loss from discontinued operations, net of tax | — | (0.37 | ) | — | (0.42 | ) | |||||||||||
Net income (loss) | $ | 0.37 | $ | (0.28 | ) | $ | 1.06 | $ | 0.22 | ||||||||
Income per share - diluted: | |||||||||||||||||
Income from continuing operations | $ | 0.35 | $ | 0.09 | $ | 1.01 | $ | 0.6 | |||||||||
Loss from discontinued operations, net of tax | — | (0.35 | ) | — | (0.37 | ) | |||||||||||
Net income (loss) | $ | 0.35 | $ | (0.26 | ) | $ | 1.01 | $ | 0.23 | ||||||||
The Company excluded 3.3 million and 3.0 million employee stock options from the calculation of diluted net income per share due to their anti-dilutive impact for the three months ended September 30, 2014 and 2013, respectively. The Company excluded 3.4 million and 3.0 million employee stock options from the calculation of diluted net income per share due to their anti-dilutive impact for the nine months ended September 30, 2014 and 2013, respectively. | |||||||||||||||||
As of September 30, 2014, the Company has a convertible note, with original face value of $25.0 million and a book value of $26.4 million, net of a $1.6 million discount. This note is convertible in whole or in part, at the option of the holder, for up to 2.8 million shares of the Company’s common stock as of September 30, 2014. As of September 30, 2013, the Company also had a convertible note payable with a book value of $22.3 million that the Company redeemed on April 7, 2014 by paying $22.3 million of cash. The outstanding convertible note payable was dilutive for the three and nine months ended September 30, 2014 and 2013. The redeemed convertible note was anti-dilutive for three months ended September 30, 2013, and dilutive for nine months ended September 30, 2013. | |||||||||||||||||
The Company has the ability to redeem the remaining convertible note upon not less than 30 days nor more than 60 days advance written notice. The Company can redeem the $28.0 million note at a premium to face value at any time through October 28, 2016 at which point the note can be redeemed at face value thereafter. | |||||||||||||||||
Fair Value Measurements - Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures, requires disclosures about how fair value is determined for assets and liabilities and a hierarchy for which these assets and liabilities must be grouped is established. The Topic establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: | |||||||||||||||||
Level 1 | quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. | ||||||||||||||||
Level 2 | quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. | ||||||||||||||||
Level 3 | unobservable inputs for the asset or liability. | ||||||||||||||||
The following table sets forth information regarding the Company's assets measured at fair value on a recurring basis (in millions): | |||||||||||||||||
Fair Value of Assets on a Recurring Basis | 30-Sep-14 | Level 1 | Level 2 | Level 3 | |||||||||||||
Chautauqua restructuring asset | $ | 87.9 | $ | — | $ | — | $ | 87.9 | |||||||||
Fair Value of Assets on a Recurring Basis | 31-Dec-13 | Level 1 | Level 2 | Level 3 | |||||||||||||
Chautauqua restructuring asset | $ | 79.6 | $ | — | $ | — | $ | 79.6 | |||||||||
Chautauqua restructuring asset - In October 2012, the Company restructured certain aircraft ownership obligations related to its 50-seat regional jet platform, Chautauqua. In connection with the restructuring, the Company issued a convertible note payable with a face value of $25.0 million, provided call rights on 28 of its owned aircraft and agreed to parent company guarantees related to future minimum lease payments, among other commitments. | |||||||||||||||||
The Company elected the fair value option under ASC 825-10, "Financial Instruments" for the agreement related to its 28 owned aircraft because management believes the fair value option provides the most accurate representation of the economic benefit of this agreement to Chautauqua in the Company's financial statements. Under the fair value option, the Company recorded an $86.4 million asset representing the combined fair value of expected future cash inflows under the agreement, net of the value of the Company's obligations attributable to the call rights on the 28 aircraft. The recurring fair value measurement of this agreement has been calculated using an income approach, which requires the use of subjective assumptions that are considered level 3 inputs. Fair values have been estimated by discounting the cash flows expected to be received over the term of the agreement, using a discount rate based on observable yields on instruments bearing comparable risks and credit worthiness of the counterparty. Critical assumptions used in the fair value measurement primarily include the amount and timing of cash inflows, the discount rate and the probability of whether the call option on the restructured aircraft will be exercised by the counterparty. A change in these assumptions could result in a significantly higher or lower fair value measurement, which would result in a gain or loss during the period in which the assumption changes. A 100 basis point change in the discount rate used would have changed the fair value of the restructuring asset by approximately $2.2 million as of September 30, 2014. Similarly, a change in the assumed probability of whether the call option on the restructured aircraft will be exercised could result in either a gain or loss of up to $3.3 million per aircraft during the period in which that assumption changed. | |||||||||||||||||
In March 2013 the agreement was amended, which resulted in a $12.0 million increase in the restructuring asset under the fair value option. The $12.0 million increase represents the fair value of expected future cash inflows under the amendment. In addition, this amendment resulted in a $12.0 million deferred credit that will amortize until the final aircraft delivery in early 2015. | |||||||||||||||||
On February 11, 2014, the Company announced the early termination of its 44 to 50 seat fixed-fee agreements with United Airlines and American Airlines, which were scheduled to terminate in 2014. These agreements began to wind-down in March 2014 and resulted in the grounding of 27 small jet aircraft. The Company notified the counterparty that 15 of the 27 aircraft to be grounded are subject to this agreement and callable by the counterparty. The Company was notified by the counterparty during the first quarter of 2014 that it did not intend to exercise its call option on these aircraft. The Company recorded a fair value gain of $18.4 million for the nine months ended September 30, 2014, which represents the fair value of the increase in cash flows expected to be received over the remaining term of the agreement, due to the counterparty's obligation to increase its payment to the Company for aircraft that cease to have applicable capacity purchase agreement reimbursement rates. | |||||||||||||||||
As of September 30, 2014, the Company would owe approximately $29.8 million under certain circumstances of non-performance or voluntary repayment, however, the Company estimated the probability of non-performance or repayment as remote. The difference between the fair value of the restructuring asset at inception and the fair value of the convertible note at inception is recognized as a reduction to depreciation expense over the remaining useful life of the related aircraft subject to this agreement. | |||||||||||||||||
The following is a reconciliation of the beginning and ending balances for the periods indicated of recurring fair value measurements using Level 3 inputs (in millions): | |||||||||||||||||
Three Months Ended | |||||||||||||||||
Chautauqua Restructuring Asset | 30-Sep-14 | 30-Sep-13 | |||||||||||||||
Beginning Balance | $ | 89.8 | $ | 86.7 | |||||||||||||
Cash received or other | (1.9 | ) | (3.1 | ) | |||||||||||||
Ending Balance | $ | 87.9 | $ | 83.6 | |||||||||||||
Nine Months Ended | |||||||||||||||||
Chautauqua Restructuring Asset | 30-Sep-14 | 30-Sep-13 | |||||||||||||||
Beginning Balance | $ | 79.6 | $ | 86.4 | |||||||||||||
Amendment to agreement | — | 12 | |||||||||||||||
Fair value gain | 18.4 | — | |||||||||||||||
Cash received or other | (10.1 | ) | (14.8 | ) | |||||||||||||
Ending Balance | $ | 87.9 | $ | 83.6 | |||||||||||||
Aircraft and Other Assets Impairment - Nonrecurring - In March 2014, we recorded a $19.9 million impairment charge related to our decision to permanently park our owned E140 fleet in March 2014, impairing these aircraft to zero. | |||||||||||||||||
($ in millions) | |||||||||||||||||
Nonrecurring Fair Value Measurements Using | |||||||||||||||||
Description | Nine months ended September 30, 2014 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Pre-tax Losses | ||||||||||||
Long-lived assets abandoned | $ | — | $ | — | $ | (19.9 | ) | ||||||||||
Fair Value of Debt - Market risk associated with our fixed and variable rate long-term debt primarily relates to the potential change in fair value and impact to future earnings, respectively, from a change in interest rates. In the table below, the aggregate fair value of debt was based primarily on recently completed market transactions and estimates based on interest rates, maturities, credit risk, and underlying collateral and is classified primarily as level 3 within the fair value hierarchy. | |||||||||||||||||
($ in millions) | September 30, | December 31, | |||||||||||||||
2014 | 2013 | ||||||||||||||||
Net carrying amount | $ | 2,345.80 | $ | 2,166.80 | |||||||||||||
Estimated fair value | 2,243.50 | 2,099.80 | |||||||||||||||
New Accounting Pronouncements – In June 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-12, Compensation - Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after Requisite Service Period. The update requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in Topic 718 as it relates to rewards with performance conditions that affect vesting to account for such awards. The Performance Target should not be reflected in estimating the grant-date fair value of the award. Compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. If achievement of the performance target becomes probable before the end of the requisite service period, the remaining unrecognized compensation cost should be recognized prospectively over the remaining requisite service period. The total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. It is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015, and the impact to the consolidated financial statements is not expected to be material. | |||||||||||||||||
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). The objective of the update is to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. It is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period and the Company is still evaluating the impact to the consolidated financial statements. | |||||||||||||||||
In April 2014, the FASB issued ASU 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. The objective of the standard is to update the requirements for reporting discontinued operations in Subtopic 205-20. It is effective in the first quarter of 2015, and the impact to the consolidated financial statements is not expected to be material. | |||||||||||||||||
In January 2014, the FASB issued ASU 2014-05, Service Concession Arrangements (Topic 853), a consensus of the FASB Emerging Issues Task Force. The objective of the update is to specify that an operating entity should not account for a service concession arrangement within the scope of this update as a lease in accordance with Topic 840, Leases. It is effective for fiscal years beginning after December 15, 2014, and the impact to the consolidated financial statements is being evaluated by the Company. | |||||||||||||||||
In July 2013, the FASB issued ASU 2013-11–Income Taxes (Topic 740), Presentation of an Unrecognized Tax Benefit When a Net Operating loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. The standard provides updated guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The amendment became effective for fiscal years beginning after December 15, 2013. The Company adopted this accounting standard on January 1, 2014, and the impact to the consolidated financial statements was not material. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2014 | |
Debt [Abstract] | ' |
Debt Disclosure [Text Block] | ' |
Debt | |
During the nine months ended September 30, 2014, the Company took delivery of 17 aircraft and borrowed $367.7 million secured by the aircraft. |
Commitments_Contingincies
Commitments & Contingincies | 9 Months Ended | ||||||||||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||||||||||
Commitments and Contingencies [Abstract] | ' | ||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Text Block] | ' | ||||||||||||||||||||||||||||
Commitments and Contingencies | |||||||||||||||||||||||||||||
As of September 30, 2014, the Company has firm orders to purchase 40 CS300 aircraft that have scheduled delivery dates beginning in early 2015 and continuing through 2017. In January 2014, Bombardier announced that the aircraft would not be expected into service until early 2016. The Company also has a commitment for 47 Embraer E175 aircraft (of which 36 have been delivered as of September 30, 2014) under the American Eagle brand that have scheduled delivery dates currently and through the first quarter of 2015. In addition, the Company has a commitment for 50 Embraer E175 aircraft under the United brand that have scheduled delivery dates between the third quarter of 2015 and the third quarter of 2017. The Company also has a commitment to acquire 11 spare aircraft engines (of which two have been delivered as of September 30, 2014) and expects to take delivery of two more engines in 2014, three engines in 2015, three engines in 2016, and one engine in 2017. | |||||||||||||||||||||||||||||
The following table displays the Company's future contractual obligations for aircraft and other equipment under firm order (in millions): | |||||||||||||||||||||||||||||
Payments Due by Period | |||||||||||||||||||||||||||||
Beyond | |||||||||||||||||||||||||||||
2014 | 2015 | 2016 | 2017 | 2018 | 2019 | Total | |||||||||||||||||||||||
Debt or lease financed aircraft under purchase obligations (1) | $ | 227.8 | $ | 1,305.50 | $ | 1,603.60 | $ | 1,211.50 | $ | — | $ | — | $ | 4,348.40 | |||||||||||||||
Engines under firm orders | 10.6 | 19.3 | 21 | 7 | — | — | 57.9 | ||||||||||||||||||||||
Total contractual obligations for aircraft and engines | $ | 238.4 | $ | 1,324.80 | $ | 1,624.60 | $ | 1,218.50 | $ | — | $ | — | $ | 4,406.30 | |||||||||||||||
(1) Represents original timing of CS300 delivery positions. | |||||||||||||||||||||||||||||
The information in the table above reflects a purchase price of the aircraft at projected delivery dates. | |||||||||||||||||||||||||||||
Contingencies | |||||||||||||||||||||||||||||
We are subject to certain legal and administrative actions which we consider routine to our business activities. As of September 30, 2014, management believes that the ultimate outcome of any pending legal matters will not have a material adverse effect on our financial position, liquidity or results of operations. | |||||||||||||||||||||||||||||
As of September 30, 2014, approximately 71% of the Company's workforce is employed under union contracts. The union contract for our pilots is currently amendable. Although we have never had a work interruption or stoppage, we are subject to risks of work interruption or stoppage and/or may incur additional administrative expenses associated with union representation of our employees. If we are unable to reach agreement with any of our unionized work groups on the amended terms of their collective bargaining agreements, we may be subject to work interruptions and/or stoppages. Any sustained work stoppages could adversely affect our ability to fulfill our obligations under our fixed-fee agreements and could have a material adverse effect on our financial condition and results of operations. | |||||||||||||||||||||||||||||
During the third quarter of 2014, the suit filed by the International Brotherhood of Teamsters ("IBT") against the Company and Frontier seeking to have the restructuring agreement declared null and void, or alternatively, seeking that the IBT manage the equity investment of the Frontier pilots due to accusations that the Company interfered with the election process was dismissed. The dismissal arose after the Frontier Airlines Pilots Association ("FAPA") was certified to replace the IBT as the collective bargaining representative of the Frontier pilots. After that occurred, the Company and Frontier sought to have the case dismissed on the ground that the IBT no longer had standing to represent the interests of the Frontier pilots. The IBT then moved to have FAPA substituted as the party in interest. The court granted that motion, after which FAPA indicated that it did not intend to continue to prosecute the case, leading to the dismissal. |
Discontinued_Operations
Discontinued Operations | 9 Months Ended | ||||
Sep. 30, 2014 | |||||
Discontinued Operations and Disposal Groups [Abstract] | ' | ||||
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block] | ' | ||||
Discontinued Operations | |||||
In October, 2013, the Company entered into a stock purchase agreement for the sale of Frontier to an affiliate of Indigo Partners LLC and the sale was completed on December 3, 2013. As a result, the Company reported Frontier as discontinued operations on the consolidated statements of operations and consolidated statements of cash flows for all periods presented. | |||||
Summarized financial information for discontinued operations is shown below: | |||||
($ in millions) | Three Months Ended September 30, 2013 | ||||
Total operating revenue | $ | 372.4 | |||
Income from discontinued operations before tax(1) | $ | 49.1 | |||
Income tax expense | 19.3 | ||||
Income from discontinued operations, net of tax | $ | 29.8 | |||
($ in millions) | Nine Months Ended September 30, 2013 | ||||
Total operating revenue | $ | 1,011.00 | |||
Income from discontinued operations before tax(1) | $ | 44.7 | |||
Income tax expense | 17.5 | ||||
Income from discontinued operations, net of tax | $ | 27.2 | |||
(1) Income from discontinued operations before taxes includes certain adjustments required by discontinued operation presentation. | |||||
Pursuant to the terms of the stock purchase agreement between the Company and Falcon Acquisition Group, Inc. ("Buyer"), the Company and Buyer are in the process of finalizing the share purchase price, which is based in part on the closing working capital of Frontier as of November 30, 2013. The Company expects to finalize the share purchase price by the end of 2014. The final share purchase price may result in an adjustment to the share purchase price that either requires Buyer to pay additional amounts to the Company or the Company to pay an amount to the Buyer. The share purchase price adjustment is not expected to be material. In addition, the stock purchase agreement contains an obligation for the Company to indemnify the Buyer under certain circumstances and subject to certain conditions and limitations. In addition to the proposed working capital adjustments, Buyer provided the Company with notice of a claim for indemnification for an unspecified amount. The Company rejected the Buyer’s claim for indemnification. With certain exceptions that are not subject to any limitation, the Company's indemnity obligation is capped under the stock purchase agreement at a maximum of $25.0 million. However, the Company believes that the likelihood that it will be required to make any payment of significant indemnification claims under the stock purchase agreement is remote and therefore the Company has not recorded any contingent liabilities for Buyer’s indemnification claims as of September 30, 2014. | |||||
Republic has retained all liabilities for all United States federal and foreign income tax on income prior to separation, as well as certain non-income taxes attributable to Frontier's business. Frontier generally will be liable for all other taxes attributable to its business. In connection with the separation, Republic separated its defined contribution plan from Frontier's business. | |||||
Republic and Frontier entered into a transition services agreement pursuant to which Republic is providing Frontier, on an interim transitional basis, various services. Transition services may be provided for up to nine months from the closing with an option for extension by the recipient. As of September 30, 2014, the transition services agreement has been extended for certain information technology and operation support through the end of October 31, 2014. Services being provided by Republic under the original agreement included certain information technology, operations and back office support. Billings by Republic under these transitional services agreements of $0.3 million and $2.6 million for the three and nine months ended September 30, 2014, respectively, are recorded as a reduction of the costs to provide the respective service in the applicable expense category in the Condensed Consolidated Statements of Operations. This transitional support enables Frontier to establish its stand-alone processes for various activities that were previously provided by Republic and does not constitute significant continuing involvement of Frontier’s operations. |
Recent_Business_Developments_N
Recent Business Developments (Notes) | 9 Months Ended |
Sep. 30, 2014 | |
Subsequent Event [Line Items] | ' |
Subsequent Events [Text Block] | ' |
Recent Business Developments | |
On October 28, 2014, the Company redeemed a convertible note by paying $26.5 million in cash. At the time of redemption the convertible note had a nominal value of $28.0 million, which included accrued interest. The retirement of the convertible note will remove 2.8 million shares from the Company’s dilutive share count and will remove approximately $1.7 million of interest expense on an annual basis going forward. |
Significant_Accounting_Policie1
Significant Accounting Policies Significant Accounting (Policies) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||||||
fixed fee service revenues [Policy Text Block] | ' | ||||||||||||||||
Rental Income – Under the Company’s fixed-fee code-share and fixed-fee charter agreements, the Company is reimbursed an amount per aircraft designed to compensate the Company for certain aircraft ownership costs. The Company has concluded that a component of its fixed-fee service revenue under the agreements discussed above is rental income, inasmuch as the agreements identify the “right of use” of a specific type and number of aircraft over a stated period of time. The amounts deemed to be rental income during the three months ended September 30, 2014 and 2013, were $108.9 million and $97.2 million, respectively. The amounts deemed to be rental income during the nine months ended September 30, 2014 and 2013 were $322.0 million and $284.3 million, respectively, and have been included in fixed-fee service revenues in the Company’s condensed consolidated statements of operations. | |||||||||||||||||
charter and other revenue [Policy Text Block] | ' | ||||||||||||||||
Charter and Other Revenue – Charter and other revenue primarily consists of lease revenue for aircraft subleased under operating leases and miscellaneous revenue related to charter flying. Charter revenues are recognized at the point that our charter service is realizable and earned, which is when the transportation is provided. All other revenue is recognized as revenue when the related goods and services are provided. | |||||||||||||||||
Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | ' | ||||||||||||||||
Restricted Cash – Restricted cash primarily consists of balances in escrow for our long-term charter agreement, restricted amounts for satisfying debt and lease payments due within the next year and certificates of deposit that secure certain letters of credit issued for workers' compensation claim reserves and certain airport authorities. Restricted cash is carried at cost, which management believes approximates fair value. | |||||||||||||||||
Earnings Per Share, Policy [Policy Text Block] | ' | ||||||||||||||||
Net Income (Loss) Per Common Share – The following table is based on the weighted average number of common shares outstanding during the period. The following is a reconciliation of the weighted average common shares for the basic and diluted per share computations (in millions, except per share information): | |||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Basic and diluted income per share: | |||||||||||||||||
Income from continuing operations | $ | 18.5 | $ | 4.3 | $ | 52.6 | $ | 31.8 | |||||||||
Loss from discontinued operations, net of tax | — | (18.1 | ) | — | (20.7 | ) | |||||||||||
Net income (loss) | 18.5 | (13.8 | ) | 52.6 | 11.1 | ||||||||||||
Income effect of assumed-conversion interest on convertible debt | 0.3 | 0.2 | 0.8 | 1.5 | |||||||||||||
Income (loss) after assumed conversion | $ | 18.8 | $ | (13.6 | ) | $ | 53.4 | $ | 12.6 | ||||||||
Weighted average common shares outstanding | 49.9 | 49.4 | 49.8 | 49.8 | |||||||||||||
Effect of dilutive securities: | |||||||||||||||||
Stock options and restricted stock | 0.3 | 0.6 | 0.4 | 0.6 | |||||||||||||
Convertible debt | 2.8 | 2.5 | 2.8 | 4.7 | |||||||||||||
Shares used to compute diluted earnings per share | 53 | 52.5 | 53 | 55.1 | |||||||||||||
Income per share - basic: | |||||||||||||||||
Income from continuing operations | $ | 0.37 | $ | 0.09 | $ | 1.06 | $ | 0.64 | |||||||||
Loss from discontinued operations, net of tax | — | (0.37 | ) | — | (0.42 | ) | |||||||||||
Net income (loss) | $ | 0.37 | $ | (0.28 | ) | $ | 1.06 | $ | 0.22 | ||||||||
Income per share - diluted: | |||||||||||||||||
Income from continuing operations | $ | 0.35 | $ | 0.09 | $ | 1.01 | $ | 0.6 | |||||||||
Loss from discontinued operations, net of tax | — | (0.35 | ) | — | (0.37 | ) | |||||||||||
Net income (loss) | $ | 0.35 | $ | (0.26 | ) | $ | 1.01 | $ | 0.23 | ||||||||
The Company excluded 3.3 million and 3.0 million employee stock options from the calculation of diluted net income per share due to their anti-dilutive impact for the three months ended September 30, 2014 and 2013, respectively. The Company excluded 3.4 million and 3.0 million employee stock options from the calculation of diluted net income per share due to their anti-dilutive impact for the nine months ended September 30, 2014 and 2013, respectively. | |||||||||||||||||
As of September 30, 2014, the Company has a convertible note, with original face value of $25.0 million and a book value of $26.4 million, net of a $1.6 million discount. This note is convertible in whole or in part, at the option of the holder, for up to 2.8 million shares of the Company’s common stock as of September 30, 2014. As of September 30, 2013, the Company also had a convertible note payable with a book value of $22.3 million that the Company redeemed on April 7, 2014 by paying $22.3 million of cash. The outstanding convertible note payable was dilutive for the three and nine months ended September 30, 2014 and 2013. The redeemed convertible note was anti-dilutive for three months ended September 30, 2013, and dilutive for nine months ended September 30, 2013. | |||||||||||||||||
The Company has the ability to redeem the remaining convertible note upon not less than 30 days nor more than 60 days advance written notice. The Company can redeem the $28.0 million note at a premium to face value at any time through October 28, 2016 at which point the note can be redeemed at face value thereafter. | |||||||||||||||||
Fair Value Measurement, Policy [Policy Text Block] | ' | ||||||||||||||||
Fair Value Measurements - Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures, requires disclosures about how fair value is determined for assets and liabilities and a hierarchy for which these assets and liabilities must be grouped is established. The Topic establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: | |||||||||||||||||
Level 1 | quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. | ||||||||||||||||
Level 2 | quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. | ||||||||||||||||
Level 3 | unobservable inputs for the asset or liability. | ||||||||||||||||
The following table sets forth information regarding the Company's assets measured at fair value on a recurring basis (in millions): | |||||||||||||||||
Fair Value of Assets on a Recurring Basis | 30-Sep-14 | Level 1 | Level 2 | Level 3 | |||||||||||||
Chautauqua restructuring asset | $ | 87.9 | $ | — | $ | — | $ | 87.9 | |||||||||
Fair Value of Assets on a Recurring Basis | 31-Dec-13 | Level 1 | Level 2 | Level 3 | |||||||||||||
Chautauqua restructuring asset | $ | 79.6 | $ | — | $ | — | $ | 79.6 | |||||||||
Chautauqua restructuring asset - In October 2012, the Company restructured certain aircraft ownership obligations related to its 50-seat regional jet platform, Chautauqua. In connection with the restructuring, the Company issued a convertible note payable with a face value of $25.0 million, provided call rights on 28 of its owned aircraft and agreed to parent company guarantees related to future minimum lease payments, among other commitments. | |||||||||||||||||
The Company elected the fair value option under ASC 825-10, "Financial Instruments" for the agreement related to its 28 owned aircraft because management believes the fair value option provides the most accurate representation of the economic benefit of this agreement to Chautauqua in the Company's financial statements. Under the fair value option, the Company recorded an $86.4 million asset representing the combined fair value of expected future cash inflows under the agreement, net of the value of the Company's obligations attributable to the call rights on the 28 aircraft. The recurring fair value measurement of this agreement has been calculated using an income approach, which requires the use of subjective assumptions that are considered level 3 inputs. Fair values have been estimated by discounting the cash flows expected to be received over the term of the agreement, using a discount rate based on observable yields on instruments bearing comparable risks and credit worthiness of the counterparty. Critical assumptions used in the fair value measurement primarily include the amount and timing of cash inflows, the discount rate and the probability of whether the call option on the restructured aircraft will be exercised by the counterparty. A change in these assumptions could result in a significantly higher or lower fair value measurement, which would result in a gain or loss during the period in which the assumption changes. A 100 basis point change in the discount rate used would have changed the fair value of the restructuring asset by approximately $2.2 million as of September 30, 2014. Similarly, a change in the assumed probability of whether the call option on the restructured aircraft will be exercised could result in either a gain or loss of up to $3.3 million per aircraft during the period in which that assumption changed. | |||||||||||||||||
In March 2013 the agreement was amended, which resulted in a $12.0 million increase in the restructuring asset under the fair value option. The $12.0 million increase represents the fair value of expected future cash inflows under the amendment. In addition, this amendment resulted in a $12.0 million deferred credit that will amortize until the final aircraft delivery in early 2015. | |||||||||||||||||
On February 11, 2014, the Company announced the early termination of its 44 to 50 seat fixed-fee agreements with United Airlines and American Airlines, which were scheduled to terminate in 2014. These agreements began to wind-down in March 2014 and resulted in the grounding of 27 small jet aircraft. The Company notified the counterparty that 15 of the 27 aircraft to be grounded are subject to this agreement and callable by the counterparty. The Company was notified by the counterparty during the first quarter of 2014 that it did not intend to exercise its call option on these aircraft. The Company recorded a fair value gain of $18.4 million for the nine months ended September 30, 2014, which represents the fair value of the increase in cash flows expected to be received over the remaining term of the agreement, due to the counterparty's obligation to increase its payment to the Company for aircraft that cease to have applicable capacity purchase agreement reimbursement rates. | |||||||||||||||||
As of September 30, 2014, the Company would owe approximately $29.8 million under certain circumstances of non-performance or voluntary repayment, however, the Company estimated the probability of non-performance or repayment as remote. The difference between the fair value of the restructuring asset at inception and the fair value of the convertible note at inception is recognized as a reduction to depreciation expense over the remaining useful life of the related aircraft subject to this agreement. | |||||||||||||||||
The following is a reconciliation of the beginning and ending balances for the periods indicated of recurring fair value measurements using Level 3 inputs (in millions): | |||||||||||||||||
Three Months Ended | |||||||||||||||||
Chautauqua Restructuring Asset | 30-Sep-14 | 30-Sep-13 | |||||||||||||||
Beginning Balance | $ | 89.8 | $ | 86.7 | |||||||||||||
Cash received or other | (1.9 | ) | (3.1 | ) | |||||||||||||
Ending Balance | $ | 87.9 | $ | 83.6 | |||||||||||||
Nine Months Ended | |||||||||||||||||
Chautauqua Restructuring Asset | 30-Sep-14 | 30-Sep-13 | |||||||||||||||
Beginning Balance | $ | 79.6 | $ | 86.4 | |||||||||||||
Amendment to agreement | — | 12 | |||||||||||||||
Fair value gain | 18.4 | — | |||||||||||||||
Cash received or other | (10.1 | ) | (14.8 | ) | |||||||||||||
Ending Balance | $ | 87.9 | $ | 83.6 | |||||||||||||
Aircraft and Other Assets Impairment - Nonrecurring - In March 2014, we recorded a $19.9 million impairment charge related to our decision to permanently park our owned E140 fleet in March 2014, impairing these aircraft to zero. | |||||||||||||||||
($ in millions) | |||||||||||||||||
Nonrecurring Fair Value Measurements Using | |||||||||||||||||
Description | Nine months ended September 30, 2014 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Pre-tax Losses | ||||||||||||
Long-lived assets abandoned | $ | — | $ | — | $ | (19.9 | ) | ||||||||||
Fair Value of Debt - Market risk associated with our fixed and variable rate long-term debt primarily relates to the potential change in fair value and impact to future earnings, respectively, from a change in interest rates. In the table below, the aggregate fair value of debt was based primarily on recently completed market transactions and estimates based on interest rates, maturities, credit risk, and underlying collateral and is classified primarily as level 3 within the fair value hierarchy. | |||||||||||||||||
($ in millions) | September 30, | December 31, | |||||||||||||||
2014 | 2013 | ||||||||||||||||
Net carrying amount | $ | 2,345.80 | $ | 2,166.80 | |||||||||||||
Estimated fair value | 2,243.50 | 2,099.80 | |||||||||||||||
New Accounting Pronouncements, Policy [Policy Text Block] | ' | ||||||||||||||||
New Accounting Pronouncements – In June 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-12, Compensation - Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after Requisite Service Period. The update requires that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in Topic 718 as it relates to rewards with performance conditions that affect vesting to account for such awards. The Performance Target should not be reflected in estimating the grant-date fair value of the award. Compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the period(s) for which the requisite service has already been rendered. If achievement of the performance target becomes probable before the end of the requisite service period, the remaining unrecognized compensation cost should be recognized prospectively over the remaining requisite service period. The total amount of compensation cost recognized during and after the requisite service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. The requisite service period ends when the employee can cease rendering service and still be eligible to vest in the award if the performance target is achieved. It is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015, and the impact to the consolidated financial statements is not expected to be material. | |||||||||||||||||
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). The objective of the update is to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. It is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period and the Company is still evaluating the impact to the consolidated financial statements. | |||||||||||||||||
In April 2014, the FASB issued ASU 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. The objective of the standard is to update the requirements for reporting discontinued operations in Subtopic 205-20. It is effective in the first quarter of 2015, and the impact to the consolidated financial statements is not expected to be material. | |||||||||||||||||
In January 2014, the FASB issued ASU 2014-05, Service Concession Arrangements (Topic 853), a consensus of the FASB Emerging Issues Task Force. The objective of the update is to specify that an operating entity should not account for a service concession arrangement within the scope of this update as a lease in accordance with Topic 840, Leases. It is effective for fiscal years beginning after December 15, 2014, and the impact to the consolidated financial statements is being evaluated by the Company. | |||||||||||||||||
In July 2013, the FASB issued ASU 2013-11–Income Taxes (Topic 740), Presentation of an Unrecognized Tax Benefit When a Net Operating loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. The standard provides updated guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The amendment became effective for fiscal years beginning after December 15, 2013. The Company adopted this accounting standard on January 1, 2014, and the impact to the consolidated financial statements was not material. |
Significant_Accounting_Policie2
Significant Accounting Policies (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Summary Of Significant Accounting Policies [Abstract] | ' | ||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | ' | ||||||||||||||||
Net Income (Loss) Per Common Share – The following table is based on the weighted average number of common shares outstanding during the period. The following is a reconciliation of the weighted average common shares for the basic and diluted per share computations (in millions, except per share information): | |||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
Basic and diluted income per share: | |||||||||||||||||
Income from continuing operations | $ | 18.5 | $ | 4.3 | $ | 52.6 | $ | 31.8 | |||||||||
Loss from discontinued operations, net of tax | — | (18.1 | ) | — | (20.7 | ) | |||||||||||
Net income (loss) | 18.5 | (13.8 | ) | 52.6 | 11.1 | ||||||||||||
Income effect of assumed-conversion interest on convertible debt | 0.3 | 0.2 | 0.8 | 1.5 | |||||||||||||
Income (loss) after assumed conversion | $ | 18.8 | $ | (13.6 | ) | $ | 53.4 | $ | 12.6 | ||||||||
Weighted average common shares outstanding | 49.9 | 49.4 | 49.8 | 49.8 | |||||||||||||
Effect of dilutive securities: | |||||||||||||||||
Stock options and restricted stock | 0.3 | 0.6 | 0.4 | 0.6 | |||||||||||||
Convertible debt | 2.8 | 2.5 | 2.8 | 4.7 | |||||||||||||
Shares used to compute diluted earnings per share | 53 | 52.5 | 53 | 55.1 | |||||||||||||
Income per share - basic: | |||||||||||||||||
Income from continuing operations | $ | 0.37 | $ | 0.09 | $ | 1.06 | $ | 0.64 | |||||||||
Loss from discontinued operations, net of tax | — | (0.37 | ) | — | (0.42 | ) | |||||||||||
Net income (loss) | $ | 0.37 | $ | (0.28 | ) | $ | 1.06 | $ | 0.22 | ||||||||
Income per share - diluted: | |||||||||||||||||
Income from continuing operations | $ | 0.35 | $ | 0.09 | $ | 1.01 | $ | 0.6 | |||||||||
Loss from discontinued operations, net of tax | — | (0.35 | ) | — | (0.37 | ) | |||||||||||
Net income (loss) | $ | 0.35 | $ | (0.26 | ) | $ | 1.01 | $ | 0.23 | ||||||||
Fair Value, Assets Measured on Recurring Basis [Table Text Block] | ' | ||||||||||||||||
The following table sets forth information regarding the Company's assets measured at fair value on a recurring basis (in millions): | |||||||||||||||||
Fair Value of Assets on a Recurring Basis | 30-Sep-14 | Level 1 | Level 2 | Level 3 | |||||||||||||
Chautauqua restructuring asset | $ | 87.9 | $ | — | $ | — | $ | 87.9 | |||||||||
Fair Value of Assets on a Recurring Basis | 31-Dec-13 | Level 1 | Level 2 | Level 3 | |||||||||||||
Chautauqua restructuring asset | $ | 79.6 | $ | — | $ | — | $ | 79.6 | |||||||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] | ' | ||||||||||||||||
The following is a reconciliation of the beginning and ending balances for the periods indicated of recurring fair value measurements using Level 3 inputs (in millions): | |||||||||||||||||
Three Months Ended | |||||||||||||||||
Chautauqua Restructuring Asset | 30-Sep-14 | 30-Sep-13 | |||||||||||||||
Beginning Balance | $ | 89.8 | $ | 86.7 | |||||||||||||
Cash received or other | (1.9 | ) | (3.1 | ) | |||||||||||||
Ending Balance | $ | 87.9 | $ | 83.6 | |||||||||||||
Nine Months Ended | |||||||||||||||||
Chautauqua Restructuring Asset | 30-Sep-14 | 30-Sep-13 | |||||||||||||||
Beginning Balance | $ | 79.6 | $ | 86.4 | |||||||||||||
Amendment to agreement | — | 12 | |||||||||||||||
Fair value gain | 18.4 | — | |||||||||||||||
Cash received or other | (10.1 | ) | (14.8 | ) | |||||||||||||
Ending Balance | $ | 87.9 | $ | 83.6 | |||||||||||||
Fair Value Measurements, Nonrecurring [Table Text Block] | ' | ||||||||||||||||
Aircraft and Other Assets Impairment - Nonrecurring - In March 2014, we recorded a $19.9 million impairment charge related to our decision to permanently park our owned E140 fleet in March 2014, impairing these aircraft to zero. | |||||||||||||||||
($ in millions) | |||||||||||||||||
Nonrecurring Fair Value Measurements Using | |||||||||||||||||
Description | Nine months ended September 30, 2014 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Pre-tax Losses | ||||||||||||
Long-lived assets abandoned | $ | — | $ | — | $ | (19.9 | ) | ||||||||||
Fair Value, by Balance Sheet Grouping [Table Text Block] | ' | ||||||||||||||||
Fair Value of Debt - Market risk associated with our fixed and variable rate long-term debt primarily relates to the potential change in fair value and impact to future earnings, respectively, from a change in interest rates. In the table below, the aggregate fair value of debt was based primarily on recently completed market transactions and estimates based on interest rates, maturities, credit risk, and underlying collateral and is classified primarily as level 3 within the fair value hierarchy. | |||||||||||||||||
($ in millions) | September 30, | December 31, | |||||||||||||||
2014 | 2013 | ||||||||||||||||
Net carrying amount | $ | 2,345.80 | $ | 2,166.80 | |||||||||||||
Estimated fair value | 2,243.50 | 2,099.80 | |||||||||||||||
Commitments_Contingincies_Tabl
Commitments & Contingincies (Tables) | 9 Months Ended | ||||||||||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||||||||||
Unrecorded Unconditional Purchase Obligation [Line Items] | ' | ||||||||||||||||||||||||||||
Unrecorded Unconditional Purchase Obligations Disclosure [Table Text Block] | ' | ||||||||||||||||||||||||||||
The following table displays the Company's future contractual obligations for aircraft and other equipment under firm order (in millions): | |||||||||||||||||||||||||||||
Payments Due by Period | |||||||||||||||||||||||||||||
Beyond | |||||||||||||||||||||||||||||
2014 | 2015 | 2016 | 2017 | 2018 | 2019 | Total | |||||||||||||||||||||||
Debt or lease financed aircraft under purchase obligations (1) | $ | 227.8 | $ | 1,305.50 | $ | 1,603.60 | $ | 1,211.50 | $ | — | $ | — | $ | 4,348.40 | |||||||||||||||
Engines under firm orders | 10.6 | 19.3 | 21 | 7 | — | — | 57.9 | ||||||||||||||||||||||
Total contractual obligations for aircraft and engines | $ | 238.4 | $ | 1,324.80 | $ | 1,624.60 | $ | 1,218.50 | $ | — | $ | — | $ | 4,406.30 | |||||||||||||||
(1) Represents original timing of CS300 delivery positions. | |||||||||||||||||||||||||||||
The information in the table above reflects a purchase price of the aircraft at projected delivery dates. |
Discontinued_Operations_Tables
Discontinued Operations (Tables) | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Results of Discontinued Operations [Abstract] | ' | ||||
Schedule of Disposal Groups, Including Discontinued Operations, Income Statement, Balance Sheet and Additional Disclosures [Table Text Block] | ' | ||||
Summarized financial information for discontinued operations is shown below: | |||||
($ in millions) | Three Months Ended September 30, 2013 | ||||
Total operating revenue | $ | 372.4 | |||
Income from discontinued operations before tax(1) | $ | 49.1 | |||
Income tax expense | 19.3 | ||||
Income from discontinued operations, net of tax | $ | 29.8 | |||
($ in millions) | Nine Months Ended September 30, 2013 | ||||
Total operating revenue | $ | 1,011.00 | |||
Income from discontinued operations before tax(1) | $ | 44.7 | |||
Income tax expense | 17.5 | ||||
Income from discontinued operations, net of tax | $ | 27.2 | |||
(1) Income from discontinued operations before taxes includes certain adjustments required by discontinued operation presentation. |
Significant_Accounting_Policie3
Significant Accounting Policies (Details) Text (USD $) | 3 Months Ended | 9 Months Ended | ||||
In Millions, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Apr. 07, 2014 | Dec. 31, 2013 |
Accounting Policies [Abstract] | ' | ' | ' | ' | ' | ' |
Fixed-Fee Rental Income | $108.90 | $97.20 | $322 | $284.30 | ' | ' |
Additional Paid in Capital | 425 | ' | 425 | ' | ' | 420.2 |
Share-based Compensation | ' | ' | 3.5 | ' | ' | ' |
Proceeds from Stock Options Exercised | ' | ' | 1.3 | 3.9 | ' | ' |
Accumulated other comprehensive loss | 2.4 | ' | 2.4 | ' | ' | 2.6 |
Accumulated Earnings | 367.5 | ' | 367.5 | ' | ' | 314.9 |
Stock Repurchase Program, Authorized Amount | ' | ' | ' | ' | 75 | ' |
Authorized amount available to repurchase common shares | ' | ' | ' | ' | 50 | ' |
Authorized amount to retire convertible notes | ' | ' | ' | ' | 50 | ' |
Treasury Stock, Shares, Acquired | 212,881 | ' | ' | ' | ' | ' |
Treasury Stock Acquired, Average Cost Per Share | $9.98 | ' | ' | ' | ' | ' |
Payments for Repurchase of Common Stock | $2.10 | ' | $2.10 | $0 | ' | ' |
Significant_Accounting_Policie4
Significant Accounting Policies (Details) EPS (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Summary Of Significant Accounting Policies [Abstract] | ' | ' | ' | ' |
INCOME FROM CONTINUING OPERATIONS | $18.50 | $4.30 | $52.60 | $31.80 |
Loss from discontinued operations, net of tax | 0 | -18.1 | 0 | -20.7 |
NET INCOME (LOSS) | 18.5 | -13.8 | 52.6 | 11.1 |
Interest on Convertible Debt, Net of Tax | 0.3 | 0.2 | 0.8 | 1.5 |
Net Income (Loss) Available to Common Stockholders, Diluted | 18.8 | -13.6 | 53.4 | 12.6 |
Weighted average number of shares outstanding | 49.9 | 49.4 | 49.8 | 49.8 |
Incremental Common Shares Attributable to Share-based Payment Arrangements | 0.3 | 0.6 | 0.4 | 0.6 |
Stock Issued During Period, Shares, Conversion of Convertible Securities | 2.8 | 2.5 | 2.8 | 4.7 |
Shares used to computed diluted earnings per share | 53 | 52.5 | 53 | 55.1 |
Income from Continuing Operations, Per Common Share - Basic | $0.37 | $0.09 | $1.06 | $0.64 |
Income (Loss) from Discontinued Operations and Disposal of Discontinued Operations, Net of Tax, Per Basic Share | $0 | ($0.37) | $0 | ($0.42) |
NET INCOME (LOSS) PER COMMON SHARE - BASIC | $0.37 | ($0.28) | $1.06 | $0.22 |
Income from Continuing Operations Per Common Share - Diluted | $0.35 | $0.09 | $1.01 | $0.60 |
Income (Loss) from Discontinued Operations and Disposal of Discontinued Operations, Net of Tax, Per Diluted Share | $0 | ($0.35) | $0 | ($0.37) |
NET INCOME (LOSS) PER COMMON SHARE - DILUTED | $0.35 | ($0.26) | $1.01 | $0.23 |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 3.3 | 3 | 3.4 | 3 |
Convertible Notes Payable - face value | 25 | ' | 25 | ' |
convertible note payable - EMB book value | 26.4 | ' | 26.4 | ' |
convertible note discount | 1.6 | ' | 1.6 | ' |
EMB - Convertible Debt - shares | ' | ' | 2.8 | ' |
Convertible Notes Payable - TPG | ' | 22.3 | ' | 22.3 |
Repayments of Convertible Debt | ' | ' | 22.3 | ' |
minimum period of time needed for written advance notice to holder to redeem note | ' | ' | '30 days | ' |
maximum period of time needed for written advance notice to redeem note | ' | ' | '60 days | ' |
Convertible Notes Payable - EMB | $28 | ' | $28 | ' |
Significant_Accounting_Policie5
Significant Accounting Policies (Details) Fair Value (USD $) | 3 Months Ended | 9 Months Ended | ||||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Dec. 31, 2012 |
Aircraft | Aircraft | |||||
Seats | Seats | |||||
Chautauqua Seats on Aircraft | 50 | ' | 50 | ' | ' | ' |
CHQ restructuring call rights provided on owned aircraft | 28 | ' | 28 | ' | ' | ' |
Derivative Asset, Fair Value, Gross Asset | $87.90 | ' | $87.90 | ' | $79.60 | $86.40 |
change in the fair value of the restructuring asset per a 100 basis point change in discount rate | 2.2 | ' | 2.2 | ' | ' | ' |
possible gain or loss if there is a change in assumed probability of call option on restructured aircrat | 3.3 | ' | 3.3 | ' | ' | ' |
Seats on E140 aircraft under CPA with American | 44 | ' | 44 | ' | ' | ' |
Seats on E145 aircraft under CPA with United | 50 | ' | 50 | ' | ' | ' |
Grounded aircraft | 27 | ' | 27 | ' | ' | ' |
Callable aircraft | 15 | ' | 15 | ' | ' | ' |
CHQ Restrucuring - possible voluntary repayment under circumstances of non-performance | ' | ' | 29.8 | ' | ' | ' |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value (begin) | 89.8 | 86.7 | 79.6 | 86.4 | ' | ' |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3 | ' | ' | 0 | 12 | ' | ' |
Fair Value Gain - restructuring asset | 0 | 0 | 18.4 | 0 | ' | ' |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Transfers out of Level 3 | -1.9 | -3.1 | -10.1 | -14.8 | ' | ' |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value (end) | 87.9 | 83.6 | 87.9 | 83.6 | ' | ' |
asset impairment charge for aircraft and related inventory | ' | ' | -19.9 | ' | ' | ' |
Long-term Debt, net carrying amount | 2,345.80 | ' | 2,345.80 | ' | 2,166.80 | ' |
Long-term Debt, Fair Value | 2,243.50 | ' | 2,243.50 | ' | 2,099.80 | ' |
Fair Value, Measurements, Nonrecurring [Member] | ' | ' | ' | ' | ' | ' |
Assets, Fair Value Disclosure | 0 | ' | 0 | ' | ' | ' |
Fair Value, Inputs, Level 1 [Member] | ' | ' | ' | ' | ' | ' |
Derivative Asset, Fair Value, Gross Asset | 0 | ' | 0 | ' | 0 | ' |
Fair Value, Inputs, Level 2 [Member] | ' | ' | ' | ' | ' | ' |
Derivative Asset, Fair Value, Gross Asset | 0 | ' | 0 | ' | 0 | ' |
Fair Value, Inputs, Level 3 [Member] | ' | ' | ' | ' | ' | ' |
Derivative Asset, Fair Value, Gross Asset | 87.9 | ' | 87.9 | ' | 79.6 | ' |
Assets, Fair Value Disclosure | $0 | ' | $0 | ' | ' | ' |
Debt_Details_Details
Debt Details (Details) (USD $) | 9 Months Ended |
In Millions, unless otherwise specified | Sep. 30, 2014 |
Aircraft | |
Debt Disclosure [Abstract] | ' |
number of AA 175 aircraft delivered | 17 |
proceeds from debt for american | $367.70 |
Commitments_Contingincies_Deta
Commitments & Contingincies (Details) Committments Table (USD $) | Sep. 30, 2014 |
In Millions, unless otherwise specified | Engines |
Aircraft | |
Long-term Purchase Commitment [Line Items] | ' |
Firm Purchase Orders for CS300 Aircraft | 40 |
Amended number of E175 aircraft agreed upon to operate under American Eagle brand | 47 |
E175 aircraft delivered under American Eagle brand | 36 |
Number of E175 aircraft to operate under United brand | 50 |
Number of Spare Aircraft Engines under commitment | 11 |
Number of engines delivered | 2 |
Number of engines to be delivered in year 1 | 2 |
Number of Engines to be Delivered in Year Two | 3 |
Number of Engines to be Delivered in Year Three | 3 |
Number of Engines to be Deliviered in Year Four | 1 |
Unrecorded Unconditional Purchase Obligation for Aircraft due within one year | $227.80 |
Unrecorded Unconditional Purchase Obligation for Aircraft due within two years | 1,305.50 |
Unrecorded Unconditional Purchase Obligation for Aircraft due within three years | 1,603.60 |
Unrecorded Unconditional Purchase Obligation for Aircraft due within four years | 1,211.50 |
Unrecorded Unconditional Purchase Obligation for Aircraft due within five years | 0 |
Unrecorded Unconditional Purchase Obligation for Aircraft due after five years | 0 |
Unrecorded Unconditional Purchase Obligation for Aircraft | 4,348.40 |
unconditional purchase obligations for engines | 10.6 |
Unrecorded Unconditional Purchase Obligation for Engines, due within two years | 19.3 |
Unrecorded Unconditional Purchase Obligation for Engines, due within three years | 21 |
Unrecorded Unconditional Purchase Obligation for Engines, due within four years | 7 |
Unrecorded Unconditional Purchase Obligation for Engines, due within five year | 0 |
Unrecorded Unconditional Purchase Obligation for Engines, due after five year | 0 |
Unrecorded Unreconciled Purchase Obligation for Engines, Total | 57.9 |
Unrecorded Unconditional Purchase Obligation, Due within One Year | 238.4 |
Unrecorded Unconditional Purchase Obligation, Due within Two Years | 1,324.80 |
Unrecorded Unconditional Purchase Obligation, Due within Three Years | 1,624.60 |
Unrecorded Unconditional Purchase Obligation, Due within Four Years | 1,218.50 |
Unrecorded Unconditional Purchase Obligation, Due within Five Years | 0 |
Unrecorded Unconditional Purchase Obligation, Due after Five Years | 0 |
Unrecorded Unconditional Purchase Obligation | $4,406.30 |
Commitments_Contingincies_Deta1
Commitments & Contingincies (Details) Contingencies | Sep. 30, 2014 |
Commitments and Contingencies Disclosure [Abstract] | ' |
Percent of Union Employees | 71.00% |
Discontinued_Operations_Detail
Discontinued Operations (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Discontinued ops [Abstract] | ' | ' | ' | ' |
Disposal Group, Including Discontinued Operation, Revenue | ' | $372.40 | ' | $1,011 |
Discontinued Operation, Income (Loss) from Discontinued Operation, before Income Tax | ' | 49.1 | ' | 44.7 |
Discontinued Operation, Tax Effect of Discontinued Operation | ' | 19.3 | ' | 17.5 |
Income from discontinued operations, net of tax | 0 | 29.8 | 0 | 27.2 |
maximum indemnity obligation under stock purchase agreement | 25 | ' | 25 | ' |
Amount billed under TSA | $0.30 | ' | $2.60 | ' |
Recent_Business_Developments_D
Recent Business Developments (Details) (USD $) | 9 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2014 | Oct. 28, 2014 |
Subsequent Event [Line Items] | ' | ' |
Cash paid for Embraer convert redemption | ' | $26.50 |
Convertible Notes Payable - EMB | 28 | ' |
EMB - Convertible Debt - shares | 2.8 | ' |
Amount of annual interest expense for EMB convert | ' | $1.70 |