DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION - shares | 9 Months Ended | |
Sep. 30, 2015 | Oct. 31, 2015 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | ALASKA AIR GROUP, INC. | |
Entity Central Index Key | 766,421 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 126,128,614 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Current Assets | ||
Cash and cash equivalents | $ 88 | $ 107 |
Marketable securities | 1,170 | 1,110 |
Total cash and marketable securities | 1,258 | 1,217 |
Receivables - net | 205 | 259 |
Inventories and supplies - net | 52 | 58 |
Deferred income taxes | 126 | 117 |
Prepaid expenses and other current assets | 74 | 105 |
Total Current Assets | 1,715 | 1,756 |
Property and Equipment | ||
Aircraft and other flight equipment | 5,557 | 5,165 |
Other property and equipment | 936 | 896 |
Deposits for future flight equipment | 775 | 555 |
Property and Equipment Total | 7,268 | 6,616 |
Less accumulated depreciation and amortization | 2,534 | 2,317 |
Total Property and Equipment - Net | 4,734 | 4,299 |
Other Assets | 115 | 126 |
Total Assets | 6,564 | 6,181 |
Current Liabilities | ||
Accounts payable | 61 | 62 |
Accrued wages, vacation and payroll taxes | 218 | 232 |
Other accrued liabilities | 698 | 629 |
Air traffic liability | 760 | 631 |
Current portion of long-term debt | 117 | 117 |
Total Current Liabilities | 1,854 | 1,671 |
Long-Term Debt, Net of Current Portion | 593 | 686 |
Other Liabilities and Credits | ||
Deferred income taxes | 746 | 750 |
Deferred revenue | 416 | 374 |
Obligation for pension and postretirement medical benefits | 249 | 246 |
Other liabilities | 341 | 327 |
Other Liabilities and Credits Totals | $ 1,752 | $ 1,697 |
Commitments and Contingencies | ||
Shareholders' Equity | ||
Preferred stock, $0.01 par value Authorized: 5,000,000 shares, none issued or outstanding | $ 0 | $ 0 |
Common stock, $0.01 par value, Authorized: 200,000,000 shares, Issued: 2015 - 128,409,720 shares; 2014 - 131,556,573 shares, Outstanding: 2015 - 126,701,469 shares; 2014 - 131,481,473 | 1 | 1 |
Capital in excess of par value | 70 | 296 |
Treasury stock (common), at cost: 2015 - 1,708,251 shares; 2014 - 75,100 shares | (127) | (4) |
Accumulated other comprehensive loss | (303) | (310) |
Retained earnings | 2,724 | 2,144 |
Total Shareholders' Equity | 2,365 | 2,127 |
Total Liabilities and Shareholders' Equity | $ 6,564 | $ 6,181 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (PARENTHETICALS) - $ / shares | Sep. 30, 2015 | Dec. 31, 2014 |
Stockholders' Equity: | ||
Preferred Stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (shares) | 0 | 0 |
Preferred stock, shares outstanding (shares) | 0 | 0 |
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (shares) | 200,000,000 | 200,000,000 |
Common stock, shares issued (shares) | 128,409,720 | 131,556,573 |
Common stock, shares outstanding (shares) | 126,701,469 | 131,481,473 |
Treasury Stock, Shares (shares) | 1,708,251 | 75,100 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Operating Revenues | ||||
Passenger, Mainline | $ 1,057 | $ 1,030 | $ 2,977 | $ 2,858 |
Passenger, Regional | 240 | 219 | 638 | 605 |
Total passenger revenue | 1,297 | 1,249 | 3,615 | 3,463 |
Freight and mail | 30 | 32 | 83 | 88 |
Other - net | 188 | 184 | 523 | 511 |
Total Operating Revenues | 1,515 | 1,465 | 4,221 | 4,062 |
Operating Expenses | ||||
Wages and benefits | 312 | 279 | 923 | 832 |
Variable incentive pay | 32 | 30 | 90 | 84 |
Aircraft fuel, including hedging gains and losses | 245 | 394 | 741 | 1,112 |
Aircraft maintenance | 67 | 58 | 182 | 166 |
Aircraft rent | 26 | 27 | 78 | 84 |
Landing fees and other rentals | 80 | 74 | 217 | 207 |
Contracted services | 74 | 66 | 209 | 188 |
Selling expenses | 53 | 55 | 160 | 154 |
Depreciation and amortization | 81 | 75 | 236 | 218 |
Food and beverage service | 30 | 24 | 83 | 68 |
Other | 82 | 67 | 259 | 229 |
Total Operating Expenses | 1,082 | 1,149 | 3,178 | 3,342 |
Operating Income | 433 | 316 | 1,043 | 720 |
Nonoperating Income (Expense) | ||||
Interest income | 5 | 5 | 16 | 15 |
Interest expense | (10) | (12) | (32) | (36) |
Interest capitalized | 9 | 5 | 25 | 14 |
Other - net | 0 | 2 | 1 | 20 |
Nonoperating Income (Expense) | 4 | 0 | 10 | 13 |
Income before income tax | 437 | 316 | 1,053 | 733 |
Income tax expense | 163 | 118 | 396 | 276 |
Net Income | $ 274 | $ 198 | $ 657 | $ 457 |
Basic Earnings Per Share (usd per share) | $ 2.15 | $ 1.47 | $ 5.08 | $ 3.35 |
Diluted Earnings Per Share (usd per share) | $ 2.14 | $ 1.45 | $ 5.05 | $ 3.31 |
Shares used for computation: | ||||
Basic shares (shares) | 127,308 | 134,865 | 129,231 | 136,482 |
Diluted shares (shares) | 128,205 | 136,158 | 130,200 | 137,825 |
Cash dividend declared per share (usd per share) | $ 0.20 | $ 0.125 | $ 0.6 | $ 0.375 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE OPERATIONS - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Net Income | $ 274 | $ 198 | $ 657 | $ 457 |
Related to marketable securities: | ||||
Unrealized holding gains (losses) arising during the period | 0 | (4) | 2 | 3 |
Reclassification of (gains) losses into Other-net nonoperating income (expense) | 0 | (1) | 0 | (2) |
Income tax effect | 0 | 2 | (1) | 0 |
Total | 0 | (3) | 1 | 1 |
Related to employee benefit plans: | ||||
Reclassification of net pension expense into Wages and benefits | 3 | 2 | 11 | 7 |
Income tax effect | (1) | (1) | (4) | (3) |
Total | 2 | 1 | 7 | 4 |
Related to interest rate derivative instruments: | ||||
Unrealized holding gains (losses) arising during the period | (5) | 0 | (8) | (5) |
Reclassification of (gains) losses into Aircraft rent | 2 | 2 | 5 | 5 |
Income tax effect | 2 | 0 | 2 | 0 |
Total | (1) | 2 | (1) | 0 |
Other Comprehensive Income | 1 | 0 | 7 | 5 |
Comprehensive Income | $ 275 | $ 198 | $ 664 | $ 462 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Cash flows from operating activities: | ||
Net Income | $ 657 | $ 457 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 236 | 218 |
Stock-based compensation and other | 22 | 27 |
Changes in certain assets and liabilities: | ||
Changes in deferred income taxes | (17) | 27 |
Increase in air traffic liability | 129 | 139 |
Increase (decrease) in deferred revenue | 42 | 21 |
Other - net | 160 | 3 |
Net cash provided by operating activities | 1,229 | 892 |
Property and equipment additions: | ||
Aircraft and aircraft purchase deposits | (563) | (414) |
Other flight equipment | (61) | (92) |
Other property and equipment | (44) | (53) |
Total property and equipment additions | (668) | (559) |
Purchases of marketable securities | (876) | (794) |
Sales and maturities of marketable securities | 818 | 739 |
Proceeds from disposition of assets and changes in restricted deposits | (1) | (4) |
Net cash used in investing activities | (727) | (618) |
Cash flows from financing activities: | ||
Proceeds from issuance of debt | 0 | 51 |
Long-term debt payments | (93) | (97) |
Common stock repurchases | (381) | (242) |
Dividends paid | (78) | (51) |
Other financing activities | 31 | 19 |
Net cash used in financing activities | (521) | (320) |
Net increase (decrease) in cash and cash equivalents | (19) | (46) |
Cash and cash equivalents at beginning of year | 107 | 80 |
Cash and cash equivalents at end of the period | 88 | 34 |
Cash paid during the period for: | ||
Interest (net of amount capitalized) | 9 | 26 |
Income taxes paid (received) | $ 262 | $ 185 |
GENERAL AND SUMMARY OF SIGNIFIC
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Organization and Basis of Presentation The interim condensed consolidated financial statements include the accounts of Alaska Air Group, Inc. (Air Group or the Company) and its subsidiaries, Alaska Airlines, Inc. (Alaska) and Horizon Air Industries, Inc. (Horizon), through which the Company conducts substantially all of its operations. All intercompany balances and transactions have been eliminated. These financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information. Consistent with these requirements, this Form 10-Q does not include all the information required by GAAP for complete financial statements. As a result, this Form 10-Q should be read in conjunction with the Consolidated Financial Statements and accompanying Notes in the Form 10-K for the year ended December 31, 2014 . In the opinion of management, all adjustments have been made that are necessary to present fairly the Company’s financial position as of September 30, 2015 , as well as the results of operations for the three and nine months ended September 30, 2015 and 2014 . The adjustments made were of a normal recurring nature. In preparing these statements, the Company is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities, as well as the reported amounts of revenues and expenses. Due to seasonal variations in the demand for air travel, the volatility of aircraft fuel prices, changes in global economic conditions, changes in the competitive environment, and other factors, operating results for the three and nine months ended September 30, 2015 , are not necessarily indicative of operating results for the entire year. Certain reclassifications, such as changes in our equity structure, have been made to prior year financial statements to conform with classifications used in the current year. Recently Issued Accounting Pronouncements In May 2014, the FASB issued Accounting Standard Update 2014-09, "Revenue from Contracts with Customers" (ASU 2014-09), which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In July 2015, the FASB agreed to defer the effective date one year, and now allows early adoption one year prior to the effective date. The standard would be effective for the Company on January 1, 2018, and early adoption is allowed on January 1, 2017. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined whether or not it will early adopt the standard. |
CASH, CASH EQUIVALENTS AND MARK
CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES | 9 Months Ended |
Sep. 30, 2015 | |
Cash, Cash Equivalents, and Short-term Investments [Abstract] | |
CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES | CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES Components for cash, cash equivalents and marketable securities (in millions): September 30, 2015 Cost Basis Unrealized Gains Unrealized Losses Fair Value Cash $ 3 $ — $ — $ 3 Cash equivalents 85 — — 85 Cash and cash equivalents 88 — — 88 U.S. government and agency securities 188 1 — 189 Foreign government bonds 31 — — 31 Asset-backed securities 137 — — 137 Mortgage-backed securities 107 — — 107 Corporate notes and bonds 682 5 (3 ) 684 Municipal securities 22 — — 22 Marketable securities 1,167 6 (3 ) 1,170 Total $ 1,255 $ 6 $ (3 ) $ 1,258 December 31, 2014 Cost Basis Unrealized Gains Unrealized Losses Fair Value Cash $ 4 $ — $ — $ 4 Cash equivalents 103 — — 103 Cash and cash equivalents 107 — — 107 U.S. government and agency securities 166 — — 166 Foreign government bonds 25 — — 25 Asset-backed securities 130 — — 130 Mortgage-backed securities 127 — (1 ) 126 Corporate notes and bonds 644 3 (2 ) 645 Municipal securities 18 — — 18 Marketable securities 1,110 3 (3 ) 1,110 Total $ 1,217 $ 3 $ (3 ) $ 1,217 Unrealized losses from fixed-income securities are primarily attributable to changes in interest rates. Management does not believe any remaining unrealized losses represent other-than-temporary impairments based on our evaluation of available evidence as of September 30, 2015 . Activity for marketable securities (in millions): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Proceeds from sales and maturities $ 142 $ 341 $ 818 $ 739 Gross realized gains — 1 2 3 Gross realized losses — — (2 ) (1 ) Maturities for marketable securities (in millions): September 30, 2015 Cost Basis Fair Value Due in one year or less $ 171 $ 171 Due after one year through five years 993 995 Due after five years through 10 years 3 4 Due after 10 years — — Total $ 1,167 $ 1,170 |
DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS | 9 Months Ended |
Sep. 30, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS | DERIVATIVE INSTRUMENTS Fuel Hedge Contracts The Company’s operations are inherently dependent upon the price and availability of aircraft fuel. To manage economic risks associated with fluctuations in aircraft fuel prices, the Company periodically enters into call options for crude oil. As of September 30, 2015 , the Company had outstanding fuel hedge contracts covering 259 million gallons of crude oil that will be settled from October 2015 to March 2017 . Refer to the contractual obligations and commitments section of Item 2 for further information. Interest Rate Swap Agreements The Company has interest rate swap agreements with a third party designed to hedge the volatility of the underlying variable interest rate in the Company's aircraft lease agreements for six Boeing 737-800 aircraft. The agreements stipulate that the Company pay a fixed interest rate over the term of the contract and receive a floating interest rate. All significant terms of the swap agreement match the terms of the lease agreements, including interest-rate index, rate reset dates, termination dates and underlying notional values. The agreements expire from February 2020 through March 2021 to coincide with the lease termination dates. Fair Values of Derivative Instruments Fair values of derivative instruments on the consolidated balance sheet (in millions): September 30, December 31, Derivative Instruments Not Designated as Hedges Fuel hedge contracts Fuel hedge contracts, current assets $ 3 $ 3 Fuel hedge contracts, noncurrent assets 2 4 Derivative Instruments Designated as Hedges Interest rate swaps Other accrued liabilities (6 ) (6 ) Other liabilities (16 ) (13 ) Losses in accumulated other comprehensive loss (AOCL) (22 ) (19 ) The net cash received (paid) for new positions and settlements was ($4) million and $1 million during the three months ended September 30, 2015 and 2014 , respectively. The net cash received (paid) for new positions and settlements was ($12) million and ($4) million during the nine months ended September 30, 2015 and 2014 , respectively. Pretax effect of derivative instruments on earnings (in millions): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Derivative Instruments Not Designated as Hedges Fuel hedge contracts: Gains (losses) recognized in aircraft fuel expense $ (10 ) $ (11 ) $ (14 ) $ (17 ) Derivative Instruments Designated as Hedges Interest rate swaps: Losses recognized in aircraft rent (2 ) (2 ) (5 ) (5 ) Gains (losses) recognized in other comprehensive income (OCI) (5 ) — (8 ) (5 ) The Company expects $6 million to be reclassified from AOCL to aircraft rent within the next twelve months. Credit Risk and Collateral The Company maintains security agreements with a number of its counterparties which may require the Company to post collateral if the fair value of the selected derivative instruments fall below specified mark-to-market thresholds. The posted collateral does not offset the fair value of the derivative instruments and is included in "Prepaid expenses and other current assets" on the consolidated balance sheet. The Company posted collateral of $5 million and $3 million as of September 30, 2015 and December 31, 2014 , respectively. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Fair Value of Financial Instruments on a Recurring Basis Fair values of financial instruments on the consolidated balance sheet (in millions): September 30, 2015 Level 1 Level 2 Total Assets Marketable securities U.S. government and agency securities $ 189 $ — $ 189 All other securities — 981 981 Derivative instruments Fuel hedge call options — 5 5 Liabilities Derivative instruments Interest rate swap agreements — (22 ) (22 ) December 31, 2014 Level 1 Level 2 Total Assets Marketable securities U.S. government and agency securities $ 166 $ — $ 166 All other securities — 944 944 Derivative instruments Fuel hedge call options — 7 7 Liabilities Derivative instruments Interest rate swap agreements — (19 ) (19 ) The Company uses the market and income approach to determine the fair value of marketable securities. U.S. government securities are Level 1 as the fair value is based on quoted prices in active markets. All other securities (Foreign government bonds, asset-backed securities, mortgage-backed securities, corporate notes and bonds, and municipal securities) are Level 2 as the fair value is based on industry standard valuation models that are calculated based on observable inputs. The Company uses the market approach and the income approach to determine the fair value of derivative instruments. Fuel hedge contracts are Level 2 as the fair value is primarily based on inputs which are readily available in active markets or can be derived from information available in active markets. The fair value considers the exposure to credit losses in the event of nonperformance by counterparties. Interest rate swap agreements are Level 2 as the fair value of these contracts is determined based on the difference between the fixed interest rate in the agreements and the observable LIBOR-based forward interest rates at period end, multiplied by the total notional value. The Company has no financial assets that are measured at fair value on a nonrecurring basis at September 30, 2015 . Fair Value of Other Financial Instruments The Company used the following methods and assumptions to determine the fair value of financial instruments that are not recognized at fair value as described below. Cash and Cash Equivalents : Carried at amortized cost, which approximates fair value. Debt : The carrying amount of the Company's variable-rate debt approximates fair values. For fixed-rate debt, the Company uses the income approach to determine the estimated fair value, through a discounted cash flow analysis using interest rates for comparable debt over the weighted remaining life of the outstanding debt. The estimated fair value of the fixed-rate debt is Level 3 as certain inputs used are unobservable. Fixed-rate debt that is not carried at fair value on the consolidated balance sheet and the estimated fair value of long-term fixed-rate debt (in millions): September 30, December 31, Carrying amount $ 540 $ 614 Fair value 575 666 |
MILEAGE PLAN
MILEAGE PLAN | 9 Months Ended |
Sep. 30, 2015 | |
MILEAGE PLAN [Abstract] | |
MILEAGE PLAN | MILEAGE PLAN Alaska's Mileage Plan liabilities and deferrals on the consolidated balance sheets (in millions): September 30, December 31, Current Liabilities: Other accrued liabilities $ 368 $ 343 Other Liabilities and Credits: Deferred revenue 410 367 Other liabilities 20 20 Total $ 798 $ 730 Alaska's Mileage Plan revenue included in the consolidated statements of operations (in millions): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Passenger revenues $ 66 $ 62 $ 199 $ 180 Other - net revenues 85 77 244 223 Total $ 151 $ 139 $ 443 $ 403 |
LONG-TERM DEBT
LONG-TERM DEBT | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | LONG-TERM DEBT Long-term debt obligations on the consolidated balance sheet (in millions): September 30, December 31, Fixed-rate notes payable due through 2024 $ 540 $ 614 Variable-rate notes payable due through 2025 170 189 Total debt 710 803 Less current portion 117 117 Long-term debt, less current portion $ 593 $ 686 Weighted-average fixed-interest rate 5.7 % 5.7 % Weighted-average variable-interest rate 1.8 % 1.6 % During the nine months ended September 30, 2015 , the Company made debt payments of $93 million . At September 30, 2015 , long-term debt principal payments for the next five years and thereafter are as follows (in millions): Total Remainder of 2015 $ 24 2016 115 2017 121 2018 151 2019 114 Thereafter 185 Total $ 710 Bank Lines of Credit The Company has two $100 million variable rate credit facilities, with interest rates based on LIBOR plus a specified margin. One of the $100 million facilities, which expires in September 2017 , is secured by aircraft. The other $100 million facility, which expires in March 2017 , is secured by certain accounts receivable, spare engines, spare parts and ground service equipment. The Company has no immediate plans to borrow using either of these facilities. These facilities have a requirement to maintain a minimum unrestricted cash and marketable securities balance of $500 million . The Company is in compliance with this covenant at September 30, 2015 . |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 9 Months Ended |
Sep. 30, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS Net periodic benefit costs recognized in the consolidated statements of operations (in millions): Three Months Ended September 30, Qualified Postretirement Medical 2015 2014 2015 2014 Service cost $ 11 $ 8 $ 1 $ 1 Interest cost 21 21 — 1 Expected return on assets (31 ) (30 ) — — Amortization of prior service cost (1 ) — — — Recognized actuarial loss (gain) 7 3 (3 ) (1 ) Total $ 7 $ 2 $ (2 ) $ 1 Net periodic benefit costs recognized in the consolidated statements of operations (in millions): Nine Months Ended September 30, Qualified Postretirement Medical 2015 2014 2015 2014 Service cost $ 31 $ 24 $ 2 $ 2 Interest cost 63 61 2 3 Expected return on assets (92 ) (88 ) — — Amortization of prior service cost (1 ) (1 ) — — Recognized actuarial loss (gain) 20 10 (8 ) (2 ) Total $ 21 $ 6 $ (4 ) $ 3 |
COMMITMENTS
COMMITMENTS | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS | COMMITMENTS Future minimum fixed payments for commitments (in millions): September 30, 2015 Aircraft Commitments Capacity Purchase Agreements (CPA) Aircraft Leases (a) Facility Leases Remainder of 2015 $ 51 $ 16 $ 13 $ 25 2016 601 67 112 98 2017 544 58 103 93 2018 428 60 98 43 2019 372 64 90 41 Thereafter 650 623 548 209 Total $ 2,646 $ 888 $ 964 $ 509 (a) Includes embedded leases under the CPA with SkyWest. Aircraft Commitments As of September 30, 2015 , the Company has purchase commitments for 71 B737 aircraft ( 34 737-900ER aircraft and 37 737 MAX aircraft) and two Q400 aircraft, with deliveries in 2015 through 2022 . In addition, the Company has options to purchase 46 B737 aircraft and five Q400 aircraft. Capacity Purchase Agreements (CPAs) At September 30, 2015 , Alaska had CPAs with three carriers, including the Company's wholly-owned subsidiary, Horizon. Horizon sells 100% of its capacity to Alaska under a CPA, for which all intercompany transactions are eliminated upon consolidation. In addition, Alaska has CPAs with SkyWest Airlines, Inc. (SkyWest) to fly certain routes and Peninsula Airways, Inc. (PenAir) to fly one route in the state of Alaska. Under these agreements, Alaska pays the third-party carriers an amount which is based on a determination of their cost of operating those flights and other factors. The costs paid by Alaska to Horizon are based on similar data and are intended to approximate market rates for those services. Future payments (excluding those due to Horizon) are based on contractually required minimum levels of flying by the third-party carriers, which could differ materially due to variable payments based on actual levels of flying and certain costs associated with operating flights, such as fuel. During the second quarter Alaska signed an amendment to the CPA with SkyWest to remove the eight CRJ-700 aircraft out of regional operations and replace them with eight E175 aircraft. Six of these CRJ-700 aircraft are leased by the Company and two of the aircraft are owned by the Company. The E175 aircraft will be introduced into service throughout 2016, at which time the CRJ-700 aircraft will be removed from service. The CPA with SkyWest is a service contract that, in accordance with GAAP, includes embedded leases related to the aircraft operated under the agreement. Lease Commitments At September 30, 2015 , the Company had lease contracts for 27 B737 aircraft, 15 Q400 aircraft, 6 CRJ-700 aircraft (operated by SkyWest), and 8 CRJ-700 aircraft that are subleased and operated by another carrier (i.e. not in the Company's fleet). In addition, the Company has 15 E175 aircraft under the CPA with SkyWest, 3 of which are included in the fleet as of September 30, 2015 . All lease contracts have remaining noncancelable lease terms ranging from 2015 to 2028 . The Company has the option to increase capacity flown by SkyWest with eight additional E175 aircraft with 2018 delivery dates. In addition, the Company has also contracted for eight E175 regional aircraft that will enter service in 2017. The majority of airport and terminal facilities are also leased. Rent expense for aircraft and facility leases was $77 million and $74 million for the three months ended September 30, 2015 and 2014 , respectively. Rent expense for aircraft and facility leases was $217 million and $215 million for the nine months ended September 30, 2015 and 2014 , respectively. |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 9 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
SHAREHOLDERS' EQUITY | SHAREHOLDERS' EQUITY Dividends During the three months ended September 30, 2015 , the Company declared and paid cash dividends of $0.20 per share, or $26 million . During the nine months ended September 30, 2015 , the Company declared and paid cash dividends of $0.60 per share, or $78 million . Common Stock Repurchase In September 2012 , the Board of Directors authorized a $250 million share repurchase program, which was completed in July 2014 . In May 2014, the Board of Directors authorized a $650 million share repurchase program, which was completed in October 2015. In August 2015, the Board of Directors authorized a $1 billion share repurchase program, which began in October 2015. Share repurchase activity (in millions, except share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Shares Amount Shares Amount Shares Amount Shares Amount 2014 Repurchase Program - $650 million 1,588,251 $ 119 3,438,723 $ 159 5,649,805 $ 381 3,438,723 $ 159 2012 Repurchase Program - $250 million — $ — 5,268 $ — — $ — 1,819,304 $ 83 Total 1,588,251 $ 119 3,443,991 $ 159 5,649,805 $ 381 5,258,027 $ 242 Accumulated Other Comprehensive Loss Components of accumulated other comprehensive income (loss), net of tax (in millions): September 30, December 31, Marketable securities $ 1 $ — Employee benefit plans (291 ) (298 ) Interest rate derivatives (13 ) (12 ) Total $ (303 ) $ (310 ) Earnings Per Share (EPS) Diluted EPS is calculated by dividing net income by the average number of common shares outstanding plus the number of additional common shares that would have been outstanding assuming the exercise of in-the-money stock options and restricted stock units, using the treasury-stock method. For the three and nine months ended September 30, 2015 and 2014 , anti-dilutive shares excluded from the calculation of EPS were not material. |
OPERATING SEGMENT INFORMATION
OPERATING SEGMENT INFORMATION | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
OPERATING SEGMENT INFORMATION | OPERATING SEGMENT INFORMATION Air Group has two operating airlines - Alaska Airlines and Horizon Air. Each is a regulated airline with separate management teams primarily in operational roles. Horizon sells 100% of its capacity to Alaska under a CPA, for which all intercompany transactions are eliminated upon consolidation. In addition, Alaska has CPAs with SkyWest to fly certain routes and PenAir to fly one route in the state of Alaska. The Company attributes revenue between Mainline and Regional based on the coupon fare in effect on the date of issuance relative to the origin and destination of each flight segment. To manage the two operating airlines and the revenues and expenses associated with the CPAs, management views the business in three operating segments. Alaska Mainline - Flying Boeing 737 jets and all associated revenues and costs. Alaska Regional - Alaska's CPAs with Horizon, SkyWest and PenAir. In this segment, Alaska Regional records actual on-board passenger revenue, less costs such as fuel, distribution costs, and payments made to Horizon, SkyWest and PenAir under the respective CPAs. Additionally, Alaska Regional includes an allocation of corporate overhead such as IT, finance, and other administrative costs incurred by Alaska on behalf of the regional operations. Horizon - Horizon operates turboprop Q400 aircraft. All of Horizon's capacity is sold to Alaska under a CPA. Expenses include those typically borne by regional airlines such as crew costs, ownership costs, and maintenance costs. The following table reports “Air Group adjusted,” which is not a measure determined in accordance with GAAP. The Company's chief operating decision-makers and others in management use this measure to evaluate operational performance and determine resource allocations. Adjustments are further explained below in reconciliation to consolidated GAAP results. Operating segment information is as follows (in millions): Three Months Ended September 30, 2015 Alaska Mainline Regional Horizon Consolidating Air Group Adjusted (a) Special Items (b) Consolidated Operating revenues Passenger Mainline $ 1,057 $ — $ — $ — $ 1,057 $ — $ 1,057 Regional — 240 — — 240 — 240 Total passenger revenues 1,057 240 — — 1,297 — 1,297 CPA revenues — — 105 (105 ) — — — Freight and mail 29 1 — — 30 — 30 Other - net 167 20 1 — 188 188 Total operating revenues 1,253 261 106 (105 ) 1,515 — 1,515 Operating expenses Operating expenses, excluding fuel 667 181 93 (104 ) 837 — 837 Economic fuel 205 35 — — 240 5 245 Total operating expenses 872 216 93 (104 ) 1,077 5 1,082 Nonoperating income (expense) Interest income 5 — — — 5 — 5 Interest expense (7 ) — (3 ) — (10 ) — (10 ) Other 7 — — 2 9 — 9 5 — (3 ) 2 4 — 4 Income before income tax $ 386 $ 45 $ 10 $ 1 $ 442 $ (5 ) $ 437 Three Months Ended September 30, 2014 Alaska Mainline Regional Horizon Consolidating Air Group Adjusted (a) Special Items (b) Consolidated Operating revenues Passenger Mainline $ 1,030 $ — $ — $ — $ 1,030 $ — $ 1,030 Regional — 219 — — 219 — 219 Total passenger revenues 1,030 219 — — 1,249 — 1,249 CPA revenues — — 99 (99 ) — — — Freight and mail 30 2 — — 32 — 32 Other - net 161 22 1 — 184 — 184 Total operating revenues 1,221 243 100 (99 ) 1,465 — 1,465 Operating expenses Operating expenses, excluding fuel 605 162 85 (97 ) 755 — 755 Economic fuel 338 52 — — 390 4 394 Total operating expenses 943 214 85 (97 ) 1,145 4 1,149 Nonoperating income (expense) Interest income 5 — — — 5 — 5 Interest expense (8 ) — (4 ) — (12 ) — (12 ) Other 7 — — — 7 — 7 4 — (4 ) — — — — Income before income tax $ 282 $ 29 $ 11 $ (2 ) $ 320 $ (4 ) $ 316 Nine Months Ended September 30, 2015 Alaska Mainline Regional Horizon Consolidating Air Group Adjusted (a) Special Items (b) Consolidated Operating revenues Passenger Mainline 2,977 — — — 2,977 — 2,977 Regional — 638 — — 638 — 638 Total passenger revenues 2,977 638 — — 3,615 — 3,615 CPA revenues — — 303 (303 ) — — — Freight and mail 79 4 — — 83 — 83 Other-net 465 55 3 523 — 523 Total operating revenues 3,521 697 306 (303 ) 4,221 — 4,221 Operating expenses Operating expenses, excluding fuel 1,951 514 274 (302 ) 2,437 — 2,437 Economic fuel 641 101 — — 742 (1 ) 741 Total operating expenses 2,592 615 274 (302 ) 3,179 (1 ) 3,178 Nonoperating income (expense) Interest income 15 — — 1 16 — 16 Interest expense (21 ) — (8 ) (3 ) (32 ) — (32 ) Other 21 — — 5 26 — 26 15 — (8 ) 3 10 — 10 Income before income tax 944 82 24 2 1,052 1 1,053 Nine Months Ended September 30, 2014 Alaska Mainline Regional Horizon Consolidating Air Group Adjusted (a) Special Items (b) Consolidated Operating revenues Passenger Mainline 2,858 — — — 2,858 — 2,858 Regional — 605 — — 605 — 605 Total passenger revenues 2,858 605 — — 3,463 — 3,463 CPA revenues — — 277 (277 ) — — — Freight and mail 84 4 — — 88 — 88 Other-net 448 59 4 — 511 — 511 Total operating revenues 3,390 668 281 (277 ) 4,062 — 4,062 Operating expenses Operating expenses, excluding fuel 1,783 464 257 (274 ) 2,230 — 2,230 Economic fuel 980 149 — — 1,129 (17 ) 1,112 Total operating expenses 2,763 613 257 (274 ) 3,359 (17 ) 3,342 Nonoperating income (expense) Interest income 15 — — — 15 — 15 Interest expense (25 ) (1 ) (10 ) — (36 ) — (36 ) Other 34 — — — 34 — 34 24 (1 ) (10 ) — 13 — 13 Income before income tax 651 54 14 (3 ) 716 17 733 (a) The adjusted column represents the financial information that is reviewed by management to assess performance of operations and determine capital allocations and does not include certain charges. (b) Includes mark-to-market fuel-hedge accounting charges. Total assets were as follows (in millions): September 30, December 31, Alaska $ 7,922 $ 6,772 Horizon 763 818 Parent company 4,161 3,552 Elimination of inter-company accounts (6,282 ) (4,961 ) Consolidated $ 6,564 $ 6,181 |
GENERAL AND SUMMARY OF SIGNIF17
GENERAL AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Organization and Basis of Presentation | Organization and Basis of Presentation The interim condensed consolidated financial statements include the accounts of Alaska Air Group, Inc. (Air Group or the Company) and its subsidiaries, Alaska Airlines, Inc. (Alaska) and Horizon Air Industries, Inc. (Horizon), through which the Company conducts substantially all of its operations. All intercompany balances and transactions have been eliminated. These financial statements have been prepared in accordance with accounting principles generally accepted in the United States (GAAP) for interim financial information. Consistent with these requirements, this Form 10-Q does not include all the information required by GAAP for complete financial statements. As a result, this Form 10-Q should be read in conjunction with the Consolidated Financial Statements and accompanying Notes in the Form 10-K for the year ended December 31, 2014 . In the opinion of management, all adjustments have been made that are necessary to present fairly the Company’s financial position as of September 30, 2015 , as well as the results of operations for the three and nine months ended September 30, 2015 and 2014 . The adjustments made were of a normal recurring nature. In preparing these statements, the Company is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities, as well as the reported amounts of revenues and expenses. Due to seasonal variations in the demand for air travel, the volatility of aircraft fuel prices, changes in global economic conditions, changes in the competitive environment, and other factors, operating results for the three and nine months ended September 30, 2015 , are not necessarily indicative of operating results for the entire year. Certain reclassifications, such as changes in our equity structure, have been made to prior year financial statements to conform with classifications used in the current year. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In May 2014, the FASB issued Accounting Standard Update 2014-09, "Revenue from Contracts with Customers" (ASU 2014-09), which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In July 2015, the FASB agreed to defer the effective date one year, and now allows early adoption one year prior to the effective date. The standard would be effective for the Company on January 1, 2018, and early adoption is allowed on January 1, 2017. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined whether or not it will early adopt the standard. |
CASH, CASH EQUIVALENTS AND MA18
CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Cash, Cash Equivalents, and Short-term Investments [Abstract] | |
Schedule of Cash, Cash Equivalents and Short-term Investments | Components for cash, cash equivalents and marketable securities (in millions): September 30, 2015 Cost Basis Unrealized Gains Unrealized Losses Fair Value Cash $ 3 $ — $ — $ 3 Cash equivalents 85 — — 85 Cash and cash equivalents 88 — — 88 U.S. government and agency securities 188 1 — 189 Foreign government bonds 31 — — 31 Asset-backed securities 137 — — 137 Mortgage-backed securities 107 — — 107 Corporate notes and bonds 682 5 (3 ) 684 Municipal securities 22 — — 22 Marketable securities 1,167 6 (3 ) 1,170 Total $ 1,255 $ 6 $ (3 ) $ 1,258 December 31, 2014 Cost Basis Unrealized Gains Unrealized Losses Fair Value Cash $ 4 $ — $ — $ 4 Cash equivalents 103 — — 103 Cash and cash equivalents 107 — — 107 U.S. government and agency securities 166 — — 166 Foreign government bonds 25 — — 25 Asset-backed securities 130 — — 130 Mortgage-backed securities 127 — (1 ) 126 Corporate notes and bonds 644 3 (2 ) 645 Municipal securities 18 — — 18 Marketable securities 1,110 3 (3 ) 1,110 Total $ 1,217 $ 3 $ (3 ) $ 1,217 |
Schedule of Realized Gain (Loss) | Activity for marketable securities (in millions): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Proceeds from sales and maturities $ 142 $ 341 $ 818 $ 739 Gross realized gains — 1 2 3 Gross realized losses — — (2 ) (1 ) |
Schedule of Debt Investment Maturities | Maturities for marketable securities (in millions): September 30, 2015 Cost Basis Fair Value Due in one year or less $ 171 $ 171 Due after one year through five years 993 995 Due after five years through 10 years 3 4 Due after 10 years — — Total $ 1,167 $ 1,170 |
DERIVATIVE INSTRUMENTS (Tables)
DERIVATIVE INSTRUMENTS (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | Fair values of derivative instruments on the consolidated balance sheet (in millions): September 30, December 31, Derivative Instruments Not Designated as Hedges Fuel hedge contracts Fuel hedge contracts, current assets $ 3 $ 3 Fuel hedge contracts, noncurrent assets 2 4 Derivative Instruments Designated as Hedges Interest rate swaps Other accrued liabilities (6 ) (6 ) Other liabilities (16 ) (13 ) Losses in accumulated other comprehensive loss (AOCL) (22 ) (19 ) |
Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance | Pretax effect of derivative instruments on earnings (in millions): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Derivative Instruments Not Designated as Hedges Fuel hedge contracts: Gains (losses) recognized in aircraft fuel expense $ (10 ) $ (11 ) $ (14 ) $ (17 ) Derivative Instruments Designated as Hedges Interest rate swaps: Losses recognized in aircraft rent (2 ) (2 ) (5 ) (5 ) Gains (losses) recognized in other comprehensive income (OCI) (5 ) — (8 ) (5 ) |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Measurement Inputs, Disclosure | Fair values of financial instruments on the consolidated balance sheet (in millions): September 30, 2015 Level 1 Level 2 Total Assets Marketable securities U.S. government and agency securities $ 189 $ — $ 189 All other securities — 981 981 Derivative instruments Fuel hedge call options — 5 5 Liabilities Derivative instruments Interest rate swap agreements — (22 ) (22 ) December 31, 2014 Level 1 Level 2 Total Assets Marketable securities U.S. government and agency securities $ 166 $ — $ 166 All other securities — 944 944 Derivative instruments Fuel hedge call options — 7 7 Liabilities Derivative instruments Interest rate swap agreements — (19 ) (19 ) |
Fair Value, by Balance Sheet Grouping | Fixed-rate debt that is not carried at fair value on the consolidated balance sheet and the estimated fair value of long-term fixed-rate debt (in millions): September 30, December 31, Carrying amount $ 540 $ 614 Fair value 575 666 |
MILEAGE PLAN MILEAGE PLAN (Tabl
MILEAGE PLAN MILEAGE PLAN (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
MILEAGE PLAN [Abstract] | |
Mileage Plan Liabilities | Alaska's Mileage Plan liabilities and deferrals on the consolidated balance sheets (in millions): September 30, December 31, Current Liabilities: Other accrued liabilities $ 368 $ 343 Other Liabilities and Credits: Deferred revenue 410 367 Other liabilities 20 20 Total $ 798 $ 730 |
Mileage Plan Revenue | Alaska's Mileage Plan revenue included in the consolidated statements of operations (in millions): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Passenger revenues $ 66 $ 62 $ 199 $ 180 Other - net revenues 85 77 244 223 Total $ 151 $ 139 $ 443 $ 403 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Long-term debt obligations on the consolidated balance sheet (in millions): September 30, December 31, Fixed-rate notes payable due through 2024 $ 540 $ 614 Variable-rate notes payable due through 2025 170 189 Total debt 710 803 Less current portion 117 117 Long-term debt, less current portion $ 593 $ 686 Weighted-average fixed-interest rate 5.7 % 5.7 % Weighted-average variable-interest rate 1.8 % 1.6 % |
Schedule of Maturities of Long-term Debt | At September 30, 2015 , long-term debt principal payments for the next five years and thereafter are as follows (in millions): Total Remainder of 2015 $ 24 2016 115 2017 121 2018 151 2019 114 Thereafter 185 Total $ 710 |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Compensation and Retirement Disclosure [Abstract] | |
Schedule of Net Benefit Costs | Net periodic benefit costs recognized in the consolidated statements of operations (in millions): Three Months Ended September 30, Qualified Postretirement Medical 2015 2014 2015 2014 Service cost $ 11 $ 8 $ 1 $ 1 Interest cost 21 21 — 1 Expected return on assets (31 ) (30 ) — — Amortization of prior service cost (1 ) — — — Recognized actuarial loss (gain) 7 3 (3 ) (1 ) Total $ 7 $ 2 $ (2 ) $ 1 Net periodic benefit costs recognized in the consolidated statements of operations (in millions): Nine Months Ended September 30, Qualified Postretirement Medical 2015 2014 2015 2014 Service cost $ 31 $ 24 $ 2 $ 2 Interest cost 63 61 2 3 Expected return on assets (92 ) (88 ) — — Amortization of prior service cost (1 ) (1 ) — — Recognized actuarial loss (gain) 20 10 (8 ) (2 ) Total $ 21 $ 6 $ (4 ) $ 3 |
COMMITMENTS (Tables)
COMMITMENTS (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases and Unrecorded Unconditional Purchase Obligtaions | Future minimum fixed payments for commitments (in millions): September 30, 2015 Aircraft Commitments Capacity Purchase Agreements (CPA) Aircraft Leases (a) Facility Leases Remainder of 2015 $ 51 $ 16 $ 13 $ 25 2016 601 67 112 98 2017 544 58 103 93 2018 428 60 98 43 2019 372 64 90 41 Thereafter 650 623 548 209 Total $ 2,646 $ 888 $ 964 $ 509 (a) Includes embedded leases under the CPA with SkyWest. |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
Schedule of Treasury Stock by Class | Share repurchase activity (in millions, except share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Shares Amount Shares Amount Shares Amount Shares Amount 2014 Repurchase Program - $650 million 1,588,251 $ 119 3,438,723 $ 159 5,649,805 $ 381 3,438,723 $ 159 2012 Repurchase Program - $250 million — $ — 5,268 $ — — $ — 1,819,304 $ 83 Total 1,588,251 $ 119 3,443,991 $ 159 5,649,805 $ 381 5,258,027 $ 242 |
Schedule of Accumulated Other Comprehensive Income (Loss) | Components of accumulated other comprehensive income (loss), net of tax (in millions): September 30, December 31, Marketable securities $ 1 $ — Employee benefit plans (291 ) (298 ) Interest rate derivatives (13 ) (12 ) Total $ (303 ) $ (310 ) |
OPERATING SEGMENT INFORMATION (
OPERATING SEGMENT INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Operating segment information is as follows (in millions): Three Months Ended September 30, 2015 Alaska Mainline Regional Horizon Consolidating Air Group Adjusted (a) Special Items (b) Consolidated Operating revenues Passenger Mainline $ 1,057 $ — $ — $ — $ 1,057 $ — $ 1,057 Regional — 240 — — 240 — 240 Total passenger revenues 1,057 240 — — 1,297 — 1,297 CPA revenues — — 105 (105 ) — — — Freight and mail 29 1 — — 30 — 30 Other - net 167 20 1 — 188 188 Total operating revenues 1,253 261 106 (105 ) 1,515 — 1,515 Operating expenses Operating expenses, excluding fuel 667 181 93 (104 ) 837 — 837 Economic fuel 205 35 — — 240 5 245 Total operating expenses 872 216 93 (104 ) 1,077 5 1,082 Nonoperating income (expense) Interest income 5 — — — 5 — 5 Interest expense (7 ) — (3 ) — (10 ) — (10 ) Other 7 — — 2 9 — 9 5 — (3 ) 2 4 — 4 Income before income tax $ 386 $ 45 $ 10 $ 1 $ 442 $ (5 ) $ 437 Three Months Ended September 30, 2014 Alaska Mainline Regional Horizon Consolidating Air Group Adjusted (a) Special Items (b) Consolidated Operating revenues Passenger Mainline $ 1,030 $ — $ — $ — $ 1,030 $ — $ 1,030 Regional — 219 — — 219 — 219 Total passenger revenues 1,030 219 — — 1,249 — 1,249 CPA revenues — — 99 (99 ) — — — Freight and mail 30 2 — — 32 — 32 Other - net 161 22 1 — 184 — 184 Total operating revenues 1,221 243 100 (99 ) 1,465 — 1,465 Operating expenses Operating expenses, excluding fuel 605 162 85 (97 ) 755 — 755 Economic fuel 338 52 — — 390 4 394 Total operating expenses 943 214 85 (97 ) 1,145 4 1,149 Nonoperating income (expense) Interest income 5 — — — 5 — 5 Interest expense (8 ) — (4 ) — (12 ) — (12 ) Other 7 — — — 7 — 7 4 — (4 ) — — — — Income before income tax $ 282 $ 29 $ 11 $ (2 ) $ 320 $ (4 ) $ 316 Nine Months Ended September 30, 2015 Alaska Mainline Regional Horizon Consolidating Air Group Adjusted (a) Special Items (b) Consolidated Operating revenues Passenger Mainline 2,977 — — — 2,977 — 2,977 Regional — 638 — — 638 — 638 Total passenger revenues 2,977 638 — — 3,615 — 3,615 CPA revenues — — 303 (303 ) — — — Freight and mail 79 4 — — 83 — 83 Other-net 465 55 3 523 — 523 Total operating revenues 3,521 697 306 (303 ) 4,221 — 4,221 Operating expenses Operating expenses, excluding fuel 1,951 514 274 (302 ) 2,437 — 2,437 Economic fuel 641 101 — — 742 (1 ) 741 Total operating expenses 2,592 615 274 (302 ) 3,179 (1 ) 3,178 Nonoperating income (expense) Interest income 15 — — 1 16 — 16 Interest expense (21 ) — (8 ) (3 ) (32 ) — (32 ) Other 21 — — 5 26 — 26 15 — (8 ) 3 10 — 10 Income before income tax 944 82 24 2 1,052 1 1,053 Nine Months Ended September 30, 2014 Alaska Mainline Regional Horizon Consolidating Air Group Adjusted (a) Special Items (b) Consolidated Operating revenues Passenger Mainline 2,858 — — — 2,858 — 2,858 Regional — 605 — — 605 — 605 Total passenger revenues 2,858 605 — — 3,463 — 3,463 CPA revenues — — 277 (277 ) — — — Freight and mail 84 4 — — 88 — 88 Other-net 448 59 4 — 511 — 511 Total operating revenues 3,390 668 281 (277 ) 4,062 — 4,062 Operating expenses Operating expenses, excluding fuel 1,783 464 257 (274 ) 2,230 — 2,230 Economic fuel 980 149 — — 1,129 (17 ) 1,112 Total operating expenses 2,763 613 257 (274 ) 3,359 (17 ) 3,342 Nonoperating income (expense) Interest income 15 — — — 15 — 15 Interest expense (25 ) (1 ) (10 ) — (36 ) — (36 ) Other 34 — — — 34 — 34 24 (1 ) (10 ) — 13 — 13 Income before income tax 651 54 14 (3 ) 716 17 733 (a) The adjusted column represents the financial information that is reviewed by management to assess performance of operations and determine capital allocations and does not include certain charges. (b) Includes mark-to-market fuel-hedge accounting charges. Total assets were as follows (in millions): September 30, December 31, Alaska $ 7,922 $ 6,772 Horizon 763 818 Parent company 4,161 3,552 Elimination of inter-company accounts (6,282 ) (4,961 ) Consolidated $ 6,564 $ 6,181 |
CASH, CASH EQUIVALENTS AND MA27
CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cash and Cash Equivalents [Abstract] | ||||||
Cash | $ 3 | $ 3 | $ 4 | |||
Cash equivalents | 85 | 85 | 103 | |||
Cash and cash equivalents | 88 | $ 34 | 88 | $ 34 | 107 | $ 80 |
Available-for-sale Securities, Current [Abstract] | ||||||
Marketable securities, Cost Basis | 1,167 | 1,167 | 1,110 | |||
Marketable securities, Unrealized Gains | 6 | 6 | 3 | |||
Marketable securities, Unrealized Losses | (3) | (3) | (3) | |||
Marketable securities, Fair Value | 1,170 | 1,170 | 1,110 | |||
Cash and marketables securities, Cost Basis | 1,255 | 1,255 | 1,217 | |||
Cash and marketable securities, Unrealized Gains | 6 | 6 | 3 | |||
Cash and marketable securities, Unrealized Losses | (3) | (3) | (3) | |||
Total cash and marketable securities | 1,258 | 1,258 | 1,217 | |||
Available-for-sale Securities, Activity [Abstract] | ||||||
Proceeds from sales and maturities | 142 | 341 | 818 | 739 | ||
Gross realized gains | 0 | 1 | 2 | 3 | ||
Gross realized losses | 0 | $ 0 | (2) | $ (1) | ||
U.S. government and agency securities [Member] | ||||||
Available-for-sale Securities, Current [Abstract] | ||||||
Marketable securities, Cost Basis | 188 | 188 | 166 | |||
Marketable securities, Unrealized Gains | 1 | 1 | 0 | |||
Marketable securities, Unrealized Losses | 0 | 0 | 0 | |||
Marketable securities, Fair Value | 189 | 189 | 166 | |||
Foreign government bonds [Member] | ||||||
Available-for-sale Securities, Current [Abstract] | ||||||
Marketable securities, Cost Basis | 31 | 31 | 25 | |||
Marketable securities, Unrealized Gains | 0 | 0 | 0 | |||
Marketable securities, Unrealized Losses | 0 | 0 | 0 | |||
Marketable securities, Fair Value | 31 | 31 | 25 | |||
Asset-backed securities [Member] | ||||||
Available-for-sale Securities, Current [Abstract] | ||||||
Marketable securities, Cost Basis | 137 | 137 | 130 | |||
Marketable securities, Unrealized Gains | 0 | 0 | 0 | |||
Marketable securities, Unrealized Losses | 0 | 0 | 0 | |||
Marketable securities, Fair Value | 137 | 137 | 130 | |||
Mortgage-backed securities [Member] | ||||||
Available-for-sale Securities, Current [Abstract] | ||||||
Marketable securities, Cost Basis | 107 | 107 | 127 | |||
Marketable securities, Unrealized Gains | 0 | 0 | 0 | |||
Marketable securities, Unrealized Losses | 0 | 0 | (1) | |||
Marketable securities, Fair Value | 107 | 107 | 126 | |||
Corporate notes and bonds [Member] | ||||||
Available-for-sale Securities, Current [Abstract] | ||||||
Marketable securities, Cost Basis | 682 | 682 | 644 | |||
Marketable securities, Unrealized Gains | 5 | 5 | 3 | |||
Marketable securities, Unrealized Losses | (3) | (3) | (2) | |||
Marketable securities, Fair Value | 684 | 684 | 645 | |||
Municipal securities [Member] | ||||||
Available-for-sale Securities, Current [Abstract] | ||||||
Marketable securities, Cost Basis | 22 | 22 | 18 | |||
Marketable securities, Unrealized Gains | 0 | 0 | 0 | |||
Marketable securities, Unrealized Losses | 0 | 0 | 0 | |||
Marketable securities, Fair Value | $ 22 | $ 22 | $ 18 |
CASH, CASH EQUIVALENTS AND MA28
CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES - MATURITIES (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 |
Cost Basis [Abstract] | |||
Due in one year or less | $ 171 | ||
Due after one year through five years | 993 | ||
Due after five years through 10 years | 3 | ||
Due after 10 years | $ 0 | ||
Marketable securities, Cost Basis | 1,167 | $ 1,110 | |
Fair Value [Abstract] | |||
Due in one year or less | 171 | ||
Due after one year through five years | 995 | ||
Due after five years through 10 years | 4 | ||
Due after 10 years | $ 0 | ||
Marketable securities, Fair Value | $ 1,170 | $ 1,110 |
DERIVATIVE INSTRUMENTS - BALANC
DERIVATIVE INSTRUMENTS - BALANCE SHEET CLASSIFICATION (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Derivatives, Fair Value [Line Items] | ||
Losses in accumulated other comprehensive loss (AOCL) | $ (303) | $ (310) |
Fuel hedge contracts [Member] | Derivative Instruments Not Designated as Hedges [Member] | Fuel hedge contracts [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets, Current | 3 | 3 |
Fuel hedge contracts [Member] | Derivative Instruments Not Designated as Hedges [Member] | Fuel hedge contracts, noncurrent assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets, Noncurrent | 2 | 4 |
Interest rate swaps agreements [Member] | Derivative Instruments Designated as Hedges [Member] | Other accrued liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities, Current | (6) | (6) |
Interest rate swaps agreements [Member] | Derivative Instruments Designated as Hedges [Member] | Other liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities, Noncurrent | (16) | (13) |
Interest rate swaps agreements [Member] | Derivative Instruments Designated as Hedges [Member] | Gains (losses) in AOCL [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Losses in accumulated other comprehensive loss (AOCL) | $ (22) | $ (19) |
DERIVATIVE INSTRUMENTS - INCOME
DERIVATIVE INSTRUMENTS - INCOME STATEMENT (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Derivative Instruments Not Designated as Hedges [Member] | Fuel hedge contracts [Member] | Gains (losses) recognized in aircraft fuel expense [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (losses) recognized in income | $ (10) | $ (11) | $ (14) | $ (17) |
Cash Flow Hedging [Member] | Derivative Instruments Designated as Hedges [Member] | Interest rate swaps agreements [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gains (losses) recognized in other comprehensive income (OCI) | (5) | 0 | (8) | (5) |
Cash Flow Hedging [Member] | Derivative Instruments Designated as Hedges [Member] | Interest rate swaps agreements [Member] | Gains (losses) recognized in aircraft rent [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (losses) recognized in income | (2) | $ (2) | (5) | $ (5) |
Gains (losses) in AOCL [Member] | Derivative Instruments Designated as Hedges [Member] | Interest rate swaps agreements [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative Gain (Loss) in Accumulated Other Comprehensive Loss To Be Reclassified Within Next Twelve Months | $ (6) | $ (6) |
DERIVATIVE INSTRUMENTS - FAIR V
DERIVATIVE INSTRUMENTS - FAIR VALUE OF HEDGE POSITIONS (Details) gallons in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015USD ($)gallonsaircraft | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)gallonsaircraft | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($) | |
Derivative [Line Items] | |||||
Net cash received (paid) to for new positions and settlements | $ (4) | $ 1 | $ 12 | $ 4 | |
Posted collateral | $ 5 | $ 5 | $ 3 | ||
B737-800 [Member] | |||||
Derivative [Line Items] | |||||
Number of aircraft under operating lease (in Aircraft) | aircraft | 6 | 6 | |||
Not Designated as Hedging Instrument [Member] | Fuel hedge contracts [Member] | |||||
Derivative [Line Items] | |||||
Fuel hedge contracts outstanding (in barrels) | gallons | 259 | 259 |
FAIR VALUE MEASUREMENTS - FAIR
FAIR VALUE MEASUREMENTS - FAIR VALUE OF ASSETS AND LIABILITIES (Details) - Recurring [Member] - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Fuel hedge contracts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative instruments, assets | $ 5 | $ 7 |
Fuel hedge contracts [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative instruments, assets | 0 | 0 |
Fuel hedge contracts [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative instruments, assets | 5 | 7 |
Interest rate swaps agreements [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative instruments, liabilities | (22) | (19) |
Interest rate swaps agreements [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative instruments, liabilities | 0 | 0 |
Interest rate swaps agreements [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative instruments, liabilities | (22) | (19) |
U.S. government and agency securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 189 | 166 |
U.S. government and agency securities [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 189 | 166 |
U.S. government and agency securities [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 0 | 0 |
All other securities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 981 | 944 |
All other securities [Member] | Level 1 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | 0 | 0 |
All other securities [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Marketable securities | $ 981 | $ 944 |
FAIR VALUE MEASUREMENTS - LONG-
FAIR VALUE MEASUREMENTS - LONG-TERM DEBT (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Carrying Amount [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | $ 540 | $ 614 |
Fair Value [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt | $ 575 | $ 666 |
MILEAGE PLAN MILEAGE PLAN (Deta
MILEAGE PLAN MILEAGE PLAN (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Mileage Plan [Line Items] | |||||
Other accrued liabilities | $ 698 | $ 698 | $ 629 | ||
Deferred revenue | 416 | 416 | 374 | ||
Other liabilities | 341 | 341 | 327 | ||
Passenger revenues | 1,297 | $ 1,249 | 3,615 | $ 3,463 | |
Other - net revenues | 188 | 184 | 523 | 511 | |
Liabilities From Mileage Plan [Member] | |||||
Mileage Plan [Line Items] | |||||
Other accrued liabilities | 368 | 368 | 343 | ||
Deferred revenue | 410 | 410 | 367 | ||
Other liabilities | 20 | 20 | 20 | ||
Total | 798 | 798 | $ 730 | ||
Revenue From Mileage Plan [Member] | |||||
Mileage Plan [Line Items] | |||||
Passenger revenues | 66 | 62 | 199 | 180 | |
Other - net revenues | 85 | 77 | 244 | 223 | |
Total Mileage Plan Revenues | $ 151 | $ 139 | $ 443 | $ 403 |
LONG-TERM DEBT - SCHEDULE OF LO
LONG-TERM DEBT - SCHEDULE OF LONG-TERM DEBT (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2015 | Dec. 31, 2014 | |
Debt Instrument [Line Items] | ||
Total | $ 710 | $ 803 |
Less current portion | 117 | 117 |
Long-term debt, less current portion | $ 593 | $ 686 |
Weighted-average fixed-interest rate | 5.70% | 5.70% |
Weighted-average variable-interest rate | 1.80% | 1.60% |
Debt payments | $ 93 | |
Fixed-rate notes payable due through 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Total | 540 | $ 614 |
Variable-rate notes payable due through 2025 [Member] | ||
Debt Instrument [Line Items] | ||
Total | $ 170 | $ 189 |
LONG-TERM DEBT LONG-TERM DEBT -
LONG-TERM DEBT LONG-TERM DEBT - FUTURE PAYMENTS (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Long-term Debt, Fiscal Year Maturity [Abstract] | ||
Remainder of 2015 | $ 24 | |
2,016 | 115 | |
2,017 | 121 | |
2,018 | 151 | |
2,019 | 114 | |
Thereafter | 185 | |
Total | $ 710 | $ 803 |
LONG-TERM DEBT - LINE OF CREDIT
LONG-TERM DEBT - LINE OF CREDIT (Details) | 9 Months Ended | |
Sep. 30, 2015USD ($)credit_facility | Oct. 02, 2015USD ($) | |
Line of Credit Facility [Line Items] | ||
Line of Credit Facility, Number of Credit Facilities | credit_facility | 2 | |
Line of Credit Facility, Maximum Borrowing Capacity | $ 100,000,000 | |
Line of Credit Facility, Asset Restrictions | 500,000,000 | |
Secured by aircraft [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | $ 100,000,000 | |
Line of Credit Facility, Expiration Date | Sep. 30, 2017 | |
Secured by other [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | $ 100,000,000 | |
Line of Credit Facility, Expiration Date | Mar. 31, 2017 | |
Subsequent Event [Member] | Secured by aircraft [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | $ 52,000,000 |
EMPLOYEE BENEFIT PLANS - NET PE
EMPLOYEE BENEFIT PLANS - NET PENSION EXPENSE (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Qualified Defined Benefit [Member] | ||||
Defined Benefit Plan, Net Periodic Benefit Cost [Abstract] | ||||
Service cost | $ 11 | $ 8 | $ 31 | $ 24 |
Interest cost | 21 | 21 | 63 | 61 |
Expected return on assets | (31) | (30) | (92) | (88) |
Amortization of prior service cost | (1) | 0 | (1) | (1) |
Recognized actuarial loss (gain) | 7 | 3 | 20 | 10 |
Net pension expense | 7 | 2 | 21 | 6 |
Postretirement Medical Benefits [Member] | ||||
Defined Benefit Plan, Net Periodic Benefit Cost [Abstract] | ||||
Service cost | 1 | 1 | 2 | 2 |
Interest cost | 0 | 1 | 2 | 3 |
Expected return on assets | 0 | 0 | 0 | 0 |
Amortization of prior service cost | 0 | 0 | 0 | 0 |
Recognized actuarial loss (gain) | (3) | (1) | (8) | (2) |
Net pension expense | $ (2) | $ 1 | $ (4) | $ 3 |
COMMITMENTS (Details)
COMMITMENTS (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015USD ($)aircraftcarriers | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)aircraftcarriers | Sep. 30, 2014USD ($) | |
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Capacity purchase arrangements (carriers) | carriers | 3 | 3 | ||
Capacity purchase arrangements (percent) | 100.00% | 100.00% | ||
Rent expense | $ 77 | $ 74 | $ 217 | $ 215 |
B-737 [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Committed to Purchase (in Aircraft) | aircraft | 71 | 71 | ||
Options to Purchase Additional (in Aircraft) | aircraft | 46 | 46 | ||
B737-900ER [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Committed to Purchase (in Aircraft) | aircraft | 34 | 34 | ||
B-737-Max [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Committed to Purchase (in Aircraft) | aircraft | 37 | 37 | ||
Q400 [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Committed to Purchase (in Aircraft) | aircraft | 2 | 2 | ||
Options to Purchase Additional (in Aircraft) | aircraft | 5 | 5 | ||
Subleased and Operated by Other Carrier [Member] | Non Operating Aircraft [Member] | CRJ-700 [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Number of aircraft under operating lease (in Aircraft) | aircraft | 8 | 8 | ||
Aircraft [Member] | ||||
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||||
Remainder of 2015 | $ 13 | $ 13 | ||
2,016 | 112 | 112 | ||
2,017 | 103 | 103 | ||
2,018 | 98 | 98 | ||
2,019 | 90 | 90 | ||
Thereafter | 548 | 548 | ||
Total | $ 964 | $ 964 | ||
Aircraft [Member] | Operated by Skywest [Member] | B-737 [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Number of aircraft under operating lease (in Aircraft) | aircraft | 27 | 27 | ||
Aircraft [Member] | Operated by Skywest [Member] | Q400 [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Number of aircraft under operating lease (in Aircraft) | aircraft | 15 | 15 | ||
Aircraft [Member] | Operated by Skywest [Member] | CRJ-700 [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Number of aircraft under operating lease (in Aircraft) | aircraft | 6 | 6 | ||
Aircraft [Member] | Operated by Skywest [Member] | E175 [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Number of aircraft under operating lease (in Aircraft) | aircraft | 15 | 15 | ||
Aircraft [Member] | Operated by Skywest [Member] | E-175 [Domain] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Number of additional aircraft that could be leased (in aircraft) | aircraft | 8 | 8 | ||
Aircraft [Member] | Operated by Skywest [Member] | Additional E175 [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Number of aircraft under operating lease (in Aircraft) | aircraft | 8 | 8 | ||
Building [Member] | ||||
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | ||||
Remainder of 2015 | $ 25 | $ 25 | ||
2,016 | 98 | 98 | ||
2,017 | 93 | 93 | ||
2,018 | 43 | 43 | ||
2,019 | 41 | 41 | ||
Thereafter | 209 | 209 | ||
Total | 509 | 509 | ||
Aircraft Commitments [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Remainder of 2015 | 51 | 51 | ||
2,016 | 601 | 601 | ||
2,017 | 544 | 544 | ||
2,018 | 428 | 428 | ||
2,019 | 372 | 372 | ||
Thereafter | 650 | 650 | ||
Total | 2,646 | 2,646 | ||
Capacity Purchase Agreements [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Remainder of 2015 | 16 | 16 | ||
2,016 | 67 | 67 | ||
2,017 | 58 | 58 | ||
2,018 | 60 | 60 | ||
2,019 | 64 | 64 | ||
Thereafter | 623 | 623 | ||
Total | $ 888 | $ 888 | ||
Capacity Purchase Agreements [Member] | Aircraft [Member] | CRJ-700 [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Number of aircraft under capacity purchase agreement | aircraft | 2 | 2 | ||
Capacity Purchase Agreements [Member] | Aircraft [Member] | Operating Aircraft [Member] | CRJ-700 [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Number of aircraft under capacity purchase agreement | aircraft | 8 | 8 | ||
Capacity Purchase Agreements [Member] | Aircraft [Member] | Operating Aircraft [Member] | E175 [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Number of aircraft under capacity purchase agreement | aircraft | 8 | 8 | ||
Capacity Purchase Agreements [Member] | Aircraft [Member] | Operating Aircraft [Member] | Delivered E175 [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Number of aircraft under operating lease (in Aircraft) | aircraft | 3 | 3 | ||
Capacity Purchase Agreements [Member] | Aircraft [Member] | Operated by Skywest [Member] | Operating Aircraft [Member] | CRJ-700 [Member] | ||||
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract] | ||||
Number of aircraft under capacity purchase agreement | aircraft | 6 | 6 |
SHAREHOLDERS' EQUITY, COMMON ST
SHAREHOLDERS' EQUITY, COMMON STOCK REPURCHASE (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Aug. 31, 2015 | May. 31, 2014 | Sep. 30, 2012 | |
Class of Stock [Line Items] | |||||||
Stock repurchased during period (shares) | 1,588,251 | 3,443,991 | 5,649,805 | 5,258,027 | |||
Stock repurchased during period | $ 119 | $ 159 | $ 381 | $ 242 | |||
September 2012 Stock Repurchase Program [Member] | |||||||
Class of Stock [Line Items] | |||||||
Stock repurchase program, authorized amount (shares) | $ 250 | ||||||
Stock repurchased during period (shares) | 0 | 5,268 | 0 | 1,819,304 | |||
Stock repurchased during period | $ 0 | $ 0 | $ 0 | $ 83 | |||
May 2014 Stock Repurchase Program [Member] | |||||||
Class of Stock [Line Items] | |||||||
Stock repurchase program, authorized amount (shares) | $ 650 | ||||||
Stock repurchased during period (shares) | 1,588,251 | 3,438,723 | 5,649,805 | 3,438,723 | |||
Stock repurchased during period | $ 119 | $ 159 | $ 381 | $ 159 | |||
1 billion dollar Repurchase Program [Member] | |||||||
Class of Stock [Line Items] | |||||||
Stock repurchase program, authorized amount (shares) | $ 1,000 |
SHAREHOLDERS' EQUITY, ACCUMULAT
SHAREHOLDERS' EQUITY, ACCUMULATED OTHER COMPREHENSIVE LOSS (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Equity [Abstract] | ||
Marketable securities | $ 1 | $ 0 |
Employee benefit plans | (291) | (298) |
Interest rate derivatives | (13) | (12) |
Total | $ (303) | $ (310) |
SHAREHOLDERS' EQUITY, CASH DIVI
SHAREHOLDERS' EQUITY, CASH DIVIDEND (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Equity [Abstract] | ||||
Cash dividend declared per share (usd per share) | $ 0.20 | $ 0.125 | $ 0.6 | $ 0.375 |
Payments of Dividends | $ 26 | $ 78 | $ 51 |
OPERATING SEGMENT INFORMATION43
OPERATING SEGMENT INFORMATION (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015USD ($)carriers | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)carrierssegment | Sep. 30, 2014USD ($) | |
Segment Reporting Information [Line Items] | ||||
Capacity purchase arrangements (percent) | 100.00% | 100.00% | ||
Number of operating airlines | carriers | 2 | 2 | ||
Number of operating segments | segment | 3 | |||
Operating revenues | ||||
Passenger, Mainline | $ 1,057 | $ 1,030 | $ 2,977 | $ 2,858 |
Passenger, Regional | 240 | 219 | 638 | 605 |
Total passenger revenue | 1,297 | 1,249 | 3,615 | 3,463 |
CPA revenues | 0 | 0 | 0 | 0 |
Freight and mail | 30 | 32 | 83 | 88 |
Other - net | 188 | 184 | 523 | 511 |
Total Operating Revenues | 1,515 | 1,465 | 4,221 | 4,062 |
Operating expenses | ||||
Operating expenses, excluding fuel | 837 | 755 | 2,437 | 2,230 |
Economic fuel | 245 | 394 | 741 | 1,112 |
Total Operating Expenses | 1,082 | 1,149 | 3,178 | 3,342 |
Nonoperating Income (Expense) | ||||
Interest income | 5 | 5 | 16 | 15 |
Interest expense | (10) | (12) | (32) | (36) |
Other | 9 | 7 | 26 | 34 |
Nonoperating Income (Expense) | 4 | 0 | 10 | 13 |
Income (loss) before income tax | 437 | 316 | 1,053 | 733 |
Air Group Adjusted [Member] | ||||
Operating revenues | ||||
Passenger, Mainline | 1,057 | 1,030 | 2,977 | 2,858 |
Passenger, Regional | 240 | 219 | 638 | 605 |
Total passenger revenue | 1,297 | 1,249 | 3,615 | 3,463 |
CPA revenues | 0 | 0 | 0 | 0 |
Freight and mail | 30 | 32 | 83 | 88 |
Other - net | 188 | 184 | 523 | 511 |
Total Operating Revenues | 1,515 | 1,465 | 4,221 | 4,062 |
Operating expenses | ||||
Operating expenses, excluding fuel | 837 | 755 | 2,437 | 2,230 |
Economic fuel | 240 | 390 | 742 | 1,129 |
Total Operating Expenses | 1,077 | 1,145 | 3,179 | 3,359 |
Nonoperating Income (Expense) | ||||
Interest income | 5 | 5 | 16 | 15 |
Interest expense | (10) | (12) | (32) | (36) |
Other | 9 | 7 | 26 | 34 |
Nonoperating Income (Expense) | 4 | 0 | 10 | 13 |
Income (loss) before income tax | 442 | 320 | 1,052 | 716 |
Alaska Mainline [Member] | ||||
Operating revenues | ||||
Passenger, Mainline | 1,057 | 1,030 | 2,977 | 2,858 |
Passenger, Regional | 0 | 0 | 0 | 0 |
Total passenger revenue | 1,057 | 1,030 | 2,977 | 2,858 |
CPA revenues | 0 | 0 | 0 | 0 |
Freight and mail | 29 | 30 | 79 | 84 |
Other - net | 167 | 161 | 465 | 448 |
Total Operating Revenues | 1,253 | 1,221 | 3,521 | 3,390 |
Operating expenses | ||||
Operating expenses, excluding fuel | 667 | 605 | 1,951 | 1,783 |
Economic fuel | 205 | 338 | 641 | 980 |
Total Operating Expenses | 872 | 943 | 2,592 | 2,763 |
Nonoperating Income (Expense) | ||||
Interest income | 5 | 5 | 15 | 15 |
Interest expense | (7) | (8) | (21) | (25) |
Other | 7 | 7 | 21 | 34 |
Nonoperating Income (Expense) | 5 | 4 | 15 | 24 |
Income (loss) before income tax | 386 | 282 | 944 | 651 |
Alaska Regional [Member] | ||||
Operating revenues | ||||
Passenger, Mainline | 0 | 0 | 0 | 0 |
Passenger, Regional | 240 | 219 | 638 | 605 |
Total passenger revenue | 240 | 219 | 638 | 605 |
CPA revenues | 0 | 0 | 0 | 0 |
Freight and mail | 1 | 2 | 4 | 4 |
Other - net | 20 | 22 | 55 | 59 |
Total Operating Revenues | 261 | 243 | 697 | 668 |
Operating expenses | ||||
Operating expenses, excluding fuel | 181 | 162 | 514 | 464 |
Economic fuel | 35 | 52 | 101 | 149 |
Total Operating Expenses | 216 | 214 | 615 | 613 |
Nonoperating Income (Expense) | ||||
Interest income | 0 | 0 | 0 | 0 |
Interest expense | 0 | 0 | 0 | (1) |
Other | 0 | 0 | 0 | 0 |
Nonoperating Income (Expense) | 0 | 0 | 0 | (1) |
Income (loss) before income tax | 45 | 29 | 82 | 54 |
Horizon [Member] | ||||
Operating revenues | ||||
Passenger, Mainline | 0 | 0 | 0 | 0 |
Passenger, Regional | 0 | 0 | 0 | 0 |
Total passenger revenue | 0 | 0 | 0 | 0 |
CPA revenues | 105 | 99 | 303 | 277 |
Freight and mail | 0 | 0 | 0 | 0 |
Other - net | 1 | 1 | 3 | 4 |
Total Operating Revenues | 106 | 100 | 306 | 281 |
Operating expenses | ||||
Operating expenses, excluding fuel | 93 | 85 | 274 | 257 |
Economic fuel | 0 | 0 | 0 | 0 |
Total Operating Expenses | 93 | 85 | 274 | 257 |
Nonoperating Income (Expense) | ||||
Interest income | 0 | 0 | 0 | 0 |
Interest expense | (3) | (4) | (8) | (10) |
Other | 0 | 0 | 0 | 0 |
Nonoperating Income (Expense) | (3) | (4) | (8) | (10) |
Income (loss) before income tax | 10 | 11 | 24 | 14 |
Intersegment Elimination [Member] | ||||
Operating revenues | ||||
Passenger, Mainline | 0 | 0 | 0 | 0 |
Passenger, Regional | 0 | 0 | 0 | 0 |
Total passenger revenue | 0 | 0 | 0 | 0 |
CPA revenues | (105) | (99) | (303) | (277) |
Freight and mail | 0 | 0 | $ 0 | 0 |
Other - net | 0 | 0 | 0 | |
Total Operating Revenues | (105) | (99) | $ (303) | (277) |
Operating expenses | ||||
Operating expenses, excluding fuel | (104) | (97) | (302) | (274) |
Economic fuel | 0 | 0 | 0 | 0 |
Total Operating Expenses | (104) | (97) | (302) | (274) |
Nonoperating Income (Expense) | ||||
Interest income | 0 | 0 | 1 | 0 |
Interest expense | 0 | 0 | (3) | 0 |
Other | 2 | 0 | 5 | 0 |
Nonoperating Income (Expense) | 2 | 0 | 3 | 0 |
Income (loss) before income tax | 1 | (2) | 2 | (3) |
Special Revenue and Charges [Member] | ||||
Operating revenues | ||||
Passenger, Mainline | 0 | 0 | 0 | 0 |
Passenger, Regional | 0 | 0 | 0 | 0 |
Total passenger revenue | 0 | 0 | 0 | 0 |
CPA revenues | 0 | 0 | 0 | 0 |
Freight and mail | $ 0 | 0 | 0 | 0 |
Other - net | 0 | 0 | 0 | |
Total Operating Revenues | $ 0 | 0 | 0 | 0 |
Operating expenses | ||||
Operating expenses, excluding fuel | 0 | 0 | 0 | 0 |
Economic fuel | 5 | 4 | (1) | (17) |
Total Operating Expenses | 5 | 4 | (1) | (17) |
Nonoperating Income (Expense) | ||||
Interest income | 0 | 0 | 0 | 0 |
Interest expense | 0 | 0 | 0 | 0 |
Other | 0 | 0 | 0 | 0 |
Nonoperating Income (Expense) | 0 | 0 | 0 | 0 |
Income (loss) before income tax | $ (5) | $ (4) | $ 1 | $ 17 |
OPERATING SEGMENT INFORMATION,
OPERATING SEGMENT INFORMATION, ASSETS (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Total assets | $ 6,564 | $ 6,181 |
Alaska Airlines [Member] | ||
Total assets | 7,922 | 6,772 |
Horizon [Member] | ||
Total assets | 763 | 818 |
Parent [Member] | ||
Total assets | 4,161 | 3,552 |
Intersegment Elimination [Member] | ||
Total assets | $ (6,282) | $ (4,961) |