Note 2 - Summary of Significant Accounting Policies Level 2 (Policies) | 12 Months Ended |
Dec. 31, 2014 |
Summary Of Significant Accounting Policies [Abstract] | |
Consolidation, Policy [Policy Text Block] | Basis of Consolidation—The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America and include the accounts of the Company and its wholly-owned subsidiaries, Chautauqua Airlines, Shuttle America, and Republic Airline. Frontier Airlines is also included in the consolidated financial statements as discontinued operations until the sale on December 3, 2013. Intercompany transactions and balances are eliminated in consolidation. |
Derivatives, Policy [Policy Text Block] | Risk Management—The Company has recorded settlements of treasury lock agreements from prior periods within accumulated other comprehensive loss. Such amounts are reclassified to interest expense over the term of the respective aircraft debt. During 2014, 2013 and 2012, the amount reclassified to interest expense was not material to the financial statements. |
Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents—Cash equivalents consist of money market funds and short-term, highly liquid investments with maturities of three months or less when purchased and approximates fair value. Substantially all of our cash is on hand with two banks. |
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Supplemental Statement of Cash Flow Information: |
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| Years ended December 31, |
(amounts in millions) | 2014 | | 2013 | | 2012 |
CASH PAID FOR INTEREST AND INCOME TAXES: | | | | | |
Interest paid-net of amount capitalized | $ | 110.1 | | | $ | 108.2 | | | $ | 116.1 | |
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Income taxes paid-net of refunds | 0.8 | | | 2.1 | | | 0.1 | |
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NON-CASH INVESTING AND FINANCING TRANSACTIONS: | | | | | | | |
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Inventory and other equipment sold for aircraft and other equipment manufacturer credits (1) | — | | | 42.8 | | | — | |
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Other equipment acquired through manufacturer credits | 23.1 | | | 11.6 | | | — | |
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Manufacturer credits applied to the purchase of aircraft | 17.1 | | | 8.7 | | | — | |
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Engines received and not yet paid | — | | | 5.8 | | | — | |
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Issuance of convertible debt | — | | | — | | | 22.9 | |
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Chautauqua restructuring asset - Aircraft Manufacturer's Incentive | — | | | 12 | | | 86.4 | |
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(1) During the first quarter of 2013, the Company entered into a flight hour pool program to minimize its upfront investment on high-value repairable inventories. Under the program, the Company sold certain parts for total non-cash proceeds of $42.8 million. The total proceeds were received in the form of credit notes that the Company intends to utilize on future aircraft purchases and were recorded as deposits within other assets on the consolidated balance sheet as of December 31, 2013. In addition, the Company recorded deferred credits of $4.0 million related to the sale that will be amortized over the term of the agreement. |
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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. |
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Receivables, Policy [Policy Text Block] | Receivables primarily consist of amounts due from our partners, OEMs and insurance providers. We provide an allowance for uncollectible accounts equal to the estimated losses expected to be incurred based on historical write-offs and other specific analysis. Bad debt expense and write-offs were not material for the years ended December 31, 2014, 2013 and 2012. |
Inventory, Policy [Policy Text Block] | Inventories consist of spare parts and supplies, which are charged to expense as they are used in operations. Inventories are valued at the lower of cost or net realizable value using an average cost methodology. An allowance for obsolescence is provided to reduce inventory to estimated net realizable value. As of December 31, 2014 and 2013, this reserve was $27.0 million and $22.6 million, respectively. |
Prepaid expenses and Other Current Assets [Policy Text Block] | Prepaid Expenses and Other Current Assets consist of prepaid expenses, primarily deposits, facility and engine rent, and other current assets. |
Property, Plant and Equipment, Policy [Policy Text Block] | Aircraft and Other Equipment is carried at cost. Incentives received from the aircraft manufacturer are recorded as reductions to the cost of the aircraft. Depreciation for aircraft is computed on a straight-line basis, to an estimated residual value, over the estimated useful life of 16.5 to 20 years. Depreciation for other equipment, including rotable parts, is computed on a straight-line basis, to an estimated residual value, over the estimated useful lives of three to ten years. Leasehold improvements are amortized over the expected life or lease term, whichever is shorter. Interest related to deposits on aircraft on firm order from the manufacturer is capitalized and was not material for the years ended December 31, 2014, 2013 and 2012, respectively. See Note 5. |
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Goodwill and Intangible Assets, Intangible Assets, Indefinite-Lived, Policy [Policy Text Block] | Intangible and Other Assets that have indefinite useful lives are not amortized but are tested if a triggering event occurred, or at least annually, for impairment. |
other assets [Policy Text Block] | Other assets consists primarily of aircraft leases and long-term deposits, Chautauqua restructuring asset, prepaid aircraft rents, and debt issue costs and other non-current assets. Debt issue costs are capitalized and are amortized using the effective interest method to interest expense over the term of the related debt. Refer to Note 6 for more detail. |
Property, Plant and Equipment, Impairment [Policy Text Block] | Long-Lived Assets—Management reviews long-lived assets for possible impairment, if there is a triggering event that detrimentally affects operations. The primary financial indicator used by the Company to assess the recoverability of its long-lived assets held and used is undiscounted future cash flows from operations. The amount of impairment, if any, is measured based on carrying value over the estimated fair value. |
deferred credits and other non current liabilities [Policy Text Block] | Deferred Credits and Other Non Current Liabilities consist primarily of credits for parts and training from the aircraft and engine manufacturers, deferred gains from the sale and leaseback of aircraft and spare jet engines and deferred revenue. Deferred credits are amortized on a straight-line basis as a reduction of aircraft or engine rent expense over the term of the respective leases. The deferred revenue is amortized as an adjustment to fixed-fee services revenue based on the weighted average aircraft in service over the life of the respective agreements. |
Comprehensive Income, Policy [Policy Text Block] | Accumulated Other Comprehensive Loss—The Company had accumulated other comprehensive loss relating to treasury lock agreements of $0.5 million and $0.8 million (net of tax), as of December 31, 2014 and 2013, respectively; and $1.7 million and $1.8 million (net of tax), relating to the pension plan as of December 31, 2014 and 2013, respectively. |
Income Tax, Policy [Policy Text Block] | Income Taxes—The Company accounts for income taxes using the asset and liability method. Under the asset and liability method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts for existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in future years in which those temporary differences are expected to be recovered or settled. The measurement of deferred tax assets is adjusted by a valuation allowance, if necessary, to recognize the future tax benefits to the extent, based on available evidence; it is more likely than not they will be realized. |
Maintenance Cost, Policy [Policy Text Block] | Aircraft Maintenance and Repair charges are expensed as incurred under the direct expense method. Engines and certain airframe component overhaul and repair costs are subject to power-by-the-hour contracts with external vendors and are expensed as the aircraft are flown. The Company also has refundable deposits related to leased aircraft. Deposits are reimbursed based on the specific event for each specified deposit, as determined by the lease. As of December 31, 2014, the Company has evaluated the carrying amount of maintenance deposits and believes the deposits are recoverable when the future maintenance event occurs and the Company is reimbursed. The Company has determined that it is probable that substantially all maintenance deposits will be refunded through qualifying maintenance activities. This analysis was performed by lease and by deposit type. The Company will continue to evaluate whether it is probable the deposits will be returned to reimburse the costs of the maintenance activities incurred. Deposits will be recognized as additional expense when they are less than probable of being returned. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates—The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Such management estimates include, but are not limited to, recognition of revenue, estimated useful lives and residual values of aircraft and other equipment, provision for accrued aircraft return costs, recoverability of maintenance deposits, fair value of financial instruments and valuation of deferred tax assets. Under the code-share agreements, the Company estimates operating costs for certain pass through costs and records revenue based on these estimates. Actual results could differ from these estimates. |
fixed fee service revenues [Policy Text Block] | Fixed-fee Service Revenues—Under our fixed-fee arrangements with our Partners, the Company receives fixed-fees for our capacity purchase agreements, as well as reimbursement of specified pass through costs on a gross basis with additional possible incentives from our Partners for superior service. These revenues are recognized in the period the service is provided, and we record an estimate of the profit component based upon the information available at the end of the accounting period. |
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The reimbursement of specified costs, known as pass through costs, may include aircraft ownership cost, passenger liability and hull insurance, aircraft property taxes, fuel, landing fees and catering. All revenue recognized under these contracts is presented at the gross amount billed for reimbursement. |
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Under the Company’s code-share 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 revenues 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 amount deemed to be rental income during 2014, 2013 and 2012 was $433.7 million, $386.8 million, and $338.5 million, respectively, and has been included in fixed-fee service revenues in the Company’s consolidated statements of operations. |
other revenue [Policy Text Block] | Other Revenue—Other revenue primarily consists of revenue related to lease revenue for aircraft leased under operating leases. |
Lease, Policy [Policy Text Block] | Lease Return Conditions—The Company must meet specified return conditions upon lease expiration for both the airframes and engines. The Company estimates lease return conditions specified in leases and accrues these amounts as contingent rent ratably over the lease term while the aircraft are operating once such costs are probable and reasonably estimable. These expenses are included in accrued liabilities in the consolidated balance sheets. |
Earnings Per Share, Policy [Policy Text Block] | Net Income (Loss) per Common Share is based on the weighted average number of shares outstanding during the period. The following is a reconciliation of the diluted net income (loss) per common share computations: |
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| For the Years Ended December 31, |
(in millions) | 2014 | | 2013 | | 2012 |
Income from continuing operations | $ | 64.3 | | | $ | 48.3 | | | $ | 31.3 | |
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Income (loss) from discontinued operations, net of tax | — | | | (21.6 | ) | | 20 | |
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Net income | $ | 64.3 | | | $ | 26.7 | | | $ | 51.3 | |
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Reduction in interest expense from convertible notes (net of tax) | 0.8 | | | 2 | | | 1.3 | |
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Net income after assumed conversion | $ | 65.1 | | | $ | 28.7 | | | $ | 52.6 | |
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Weighted-average common shares outstanding for basic net income per common share | 49.8 | | | 49.2 | | | 48.5 | |
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Effect of dilutive employee stock options | 0.4 | | | 0.7 | | | 0.2 | |
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Effect of dilutive convertible notes | 2.2 | | | 4.7 | | | 2.7 | |
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Adjusted weighted-average common shares outstanding and assumed conversions for diluted net income per common share | 52.4 | | | 54.6 | | | 51.4 | |
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Income (loss) per share - basic: | | | | | |
Income from continuing operations | $ | 1.29 | | | $ | 0.98 | | | $ | 0.65 | |
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Income (loss) from discontinued operations, net of tax | — | | | (0.44 | ) | | 0.41 | |
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Net income per share - basic | $ | 1.29 | | | $ | 0.54 | | | $ | 1.06 | |
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Income (loss) per share - diluted: | | | | | |
Income from continuing operations | $ | 1.24 | | | $ | 0.92 | | | $ | 0.63 | |
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Income (loss) from discontinued operations, net of tax | — | | | (0.40 | ) | | 0.39 | |
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Net income per share - diluted | $ | 1.24 | | | $ | 0.52 | | | $ | 1.02 | |
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The Company excluded 2.5 million, 3.3 million, and 4.1 million of employee stock options from the calculation of diluted net income (loss) per share due to their anti-dilutive impact for the years ended December 31, 2014, 2013, and 2012, respectively. |
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The Company had two convertible notes with face values of $22.3 million and $25.0 million that were convertible in whole or in part, at the option of the holder, for up to 2.2 million and 2.5 million shares, respectively, of the Company’s common stock, which were both redeemed during 2014. The convertible note payable for 2.5 million shares was issued in November of 2012, and it was dilutive for the twelve months ended December 31, 2014 and December 31, 2013. The convertible note payable for 2.2 million shares was anti-dilutive for the twelve months ended December 31, 2014, and dilutive for the twelve months ended December 31, 2013 and 2012, respectively. |
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On April 7, 2014, the board authorized management to utilize up to $75 million to buy back shares and/or early retire convertible debt during the twelve months thereafter. The authorization approved Company repurchases of up to $50 million of common shares and retirements of up to $50 million of convertible notes, or combination thereof. Also, on April 7, 2014, the Company redeemed the convertible note with a face value of $22.3 million, by paying $22.3 million of cash. |
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On October 28, 2014, the Company redeemed the convertible note with a face value of $25.0 million, 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. |
Segment Reporting, Policy [Policy Text Block] | Segment Information—As a result of the sale of Frontier there is only one reportable segment for the scheduled transportation of passengers under code-share agreements. |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments—The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, restricted cash, receivables, and accounts payable approximate fair values because of the immediate or short-term maturity of these financial instruments. |
New Accounting Pronouncements, Policy [Policy Text Block] | Accounting Pronouncements—In January 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2015-01, Income Statement - Extraordinary and Unusual Items (Subtopic 225-20): Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items. The objective of this update is to identify, evaluate, and improve areas of generally accepted accounting principles (GAAP) for which cost and complexity can be reduced while maintaining or improving the usefulness of the information provided to the users of financial statements. It is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015 and the Company is still evaluating the impact to the consolidated financial statements. |
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In June 2014, the FASB issued 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. 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. |
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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. |
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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. |
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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 was not material. |
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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. It became effective for fiscal years beginning after December 15, 2013, and the impact to the consolidated financial statements was not material. |