Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Oct. 31, 2015 | |
Document and Entity Information | ||
Entity Registrant Name | SKYWEST INC | |
Entity Central Index Key | 793,733 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2015 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 50,752,301 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 126,744 | $ 132,275 |
Marketable securities | 429,806 | 415,273 |
Restricted cash | 11,584 | 11,582 |
Income tax receivable | 393 | 2,779 |
Receivables, net | 64,702 | 83,099 |
Inventories, net | 140,109 | 137,452 |
Prepaid aircraft rents | 402,685 | 397,850 |
Deferred tax assets | 148,054 | 94,385 |
Other current assets | 34,308 | 16,308 |
Total current assets | 1,358,385 | 1,291,003 |
PROPERTY AND EQUIPMENT: | ||
Aircraft and rotable spares | 5,193,614 | 4,608,663 |
Deposits on aircraft | 34,822 | 40,000 |
Buildings and ground equipment | 273,102 | 274,900 |
Total property and equipment, gross | 5,501,538 | 4,923,563 |
Less-accumulated depreciation and amortization | (2,029,907) | (1,902,375) |
Total property and equipment, net | 3,471,631 | 3,021,188 |
OTHER ASSETS | ||
Intangible assets, net | 11,061 | 12,748 |
Other assets | 85,366 | 84,989 |
Total other assets | 96,427 | 97,737 |
Total assets | 4,926,443 | 4,409,928 |
CURRENT LIABILITIES: | ||
Current maturities of long-term debt | 264,852 | 211,821 |
Accounts payable | 265,807 | 270,097 |
Accrued salaries, wages and benefits | 134,725 | 138,902 |
Accrued aircraft rents | 2,495 | 3,303 |
Taxes other than income taxes | 22,457 | 17,457 |
Other current liabilities | 43,798 | 42,775 |
Total current liabilities | 734,134 | 684,355 |
OTHER LONG-TERM LIABILITIES | 50,052 | 49,625 |
LONG-TERM DEBT, net of current maturities | 1,842,855 | 1,533,990 |
DEFERRED INCOME TAXES PAYABLE | 772,710 | 669,385 |
DEFERRED AIRCRAFT CREDITS | $ 64,989 | $ 72,227 |
COMMITMENTS AND CONTINGENCIES | ||
STOCKHOLDERS' EQUITY: | ||
Preferred stock, 5,000,000 shares authorized; none issued | ||
Common stock, no par value, 120,000,000 shares authorized; 78,705,286 and 77,951,411 shares issued, respectively | $ 635,217 | $ 626,521 |
Retained earnings | 1,236,627 | 1,165,478 |
Treasury stock, at cost, 28,015,386 and 26,765,386 shares, respectively | (410,090) | (391,364) |
Accumulated other comprehensive (loss) | (51) | (289) |
Total stockholders' equity | 1,461,703 | 1,400,346 |
Total liabilities and stockholders' equity | $ 4,926,443 | $ 4,409,928 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2015 | Dec. 31, 2014 |
CONSOLIDATED BALANCE SHEETS | ||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized | 120,000,000 | 120,000,000 |
Common stock, shares issued | 78,705,286 | 77,951,411 |
Treasury stock, at cost, shares | 28,015,386 | 26,765,386 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
OPERATING REVENUES: | ||||
Passenger | $ 777,480 | $ 815,867 | $ 2,293,085 | $ 2,372,054 |
Ground handling and other | 16,524 | 18,766 | 49,734 | 51,538 |
Total operating revenues | 794,004 | 834,633 | 2,342,819 | 2,423,592 |
OPERATING EXPENSES: | ||||
Salaries, wages and benefits | 304,633 | 315,766 | 906,051 | 944,253 |
Aircraft maintenance, materials and repairs | 147,396 | 159,920 | 461,972 | 509,905 |
Aircraft rentals | 68,003 | 72,899 | 206,857 | 232,682 |
Depreciation and amortization | 66,603 | 65,822 | 196,953 | 192,389 |
Aircraft fuel | 31,762 | 49,177 | 90,254 | 154,420 |
Ground handling services | 18,892 | 31,114 | 62,981 | 100,446 |
Special charges | 4,713 | |||
Other operating expenses | 78,419 | 80,855 | 235,447 | 240,236 |
Total operating expenses | 715,708 | 775,553 | 2,160,515 | 2,379,044 |
OPERATING INCOME | 78,296 | 59,080 | 182,304 | 44,548 |
OTHER INCOME (EXPENSE): | ||||
Interest income | 311 | 2,549 | 1,647 | 3,608 |
Interest expense | (19,914) | (16,883) | (56,460) | (48,697) |
Other, net | 1,070 | 23,598 | 1,070 | 20,709 |
Total other expense, net | (18,533) | 9,264 | (53,743) | (24,308) |
INCOME BEFORE INCOME TAXES | 59,763 | 68,344 | 128,561 | 20,168 |
PROVISION FOR INCOME TAXES | 23,495 | 27,006 | 51,198 | 16,455 |
NET INCOME | $ 36,268 | $ 41,338 | $ 77,363 | $ 3,713 |
BASIC EARNINGS PER SHARE (in dollars per share) | $ 0.72 | $ 0.81 | $ 1.51 | $ 0.07 |
DILUTED EARNINGS PER SHARE (in dollars per share) | $ 0.71 | $ 0.79 | $ 1.49 | $ 0.07 |
Weighted average common shares: | ||||
Basic (in shares) | 50,616 | 51,322 | 51,143 | 51,324 |
Diluted (in shares) | 51,282 | 52,036 | 51,882 | 51,562 |
Dividends declared per share (in dollars per share) | $ 0.04 | $ 0.04 | $ 0.12 | $ 0.12 |
COMPREHENSIVE INCOME (LOSS): | ||||
Net income | $ 36,268 | $ 41,338 | $ 77,363 | $ 3,713 |
Proportionate share of other companies foreign currency translation adjustment, net of taxes | (1,130) | (1,130) | ||
Net unrealized appreciation (depreciation) on marketable securities, net of taxes | 161 | (222) | 239 | (157) |
TOTAL COMPREHENSIVE INCOME | $ 36,429 | $ 39,986 | $ 77,602 | $ 2,426 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
NET CASH PROVIDED BY OPERATING ACTIVITIES | $ 313,540 | $ 186,369 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchases of marketable securities | (864,241) | (198,690) |
Sales of marketable securities | 849,942 | 293,056 |
Proceeds from the sale of equipment | 5,771 | 3,468 |
Proceeds received from sale of Trip Linhas Aereas S.A. stock | 17,237 | |
Acquisition of property and equipment: | ||
Aircraft and rotable spare parts | (647,250) | (479,451) |
Buildings and ground equipment | (7,443) | (16,017) |
Return of deposits on aircraft | 5,178 | |
Increase in other assets | (2,713) | (12,218) |
NET CASH USED IN INVESTING ACTIVITIES | (660,756) | (392,615) |
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES: | ||
Proceeds from issuance of long-term debt | 546,232 | 323,665 |
Principal payments on long-term debt | (184,336) | (124,660) |
Tax deficiency from exercise of common stock options | (2,093) | (1,245) |
Net proceeds from issuance of common stock | 6,791 | 3,831 |
Purchase of treasury stock | (18,726) | (8,414) |
Payment of cash dividends | (6,183) | (6,174) |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 341,685 | 187,003 |
Decrease in cash and cash equivalents | (5,531) | (19,243) |
Cash and cash equivalents at beginning of period | 132,275 | 170,636 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 126,744 | 151,393 |
Cash paid during the year for: | ||
Interest, net of capitalized amounts | 56,117 | 46,757 |
Income taxes | $ 1,494 | $ 485 |
Condensed Consolidated Financia
Condensed Consolidated Financial Statements | 9 Months Ended |
Sep. 30, 2015 | |
Condensed Consolidated Financial Statements | |
Condensed Consolidated Financial Statements | Note A — Condensed Consolidated Financial Statements Basis of Presentation The condensed consolidated financial statements of SkyWest, Inc. (“SkyWest” or the “Company”) and its operating subsidiaries, SkyWest Airlines, Inc. (“SkyWest Airlines”) and ExpressJet Airlines Inc. (“ExpressJet”) included herein have been prepared, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the following disclosures are adequate to make the information presented not misleading. These condensed consolidated financial statements reflect all adjustments that, in the opinion of management, are necessary to present fairly the results of operations for the interim periods presented. All adjustments are of a normal recurring nature, unless otherwise disclosed. The Company suggests that these condensed consolidated financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014. The results of operations for the three and nine-month periods ended September 30, 2015 are not necessarily indicative of the results that may be expected for the year ending December 31, 2015. The preparation of financial statements in conformity with GAAP 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 period. Actual results will likely differ, and may differ materially, from those estimates and assumptions. |
Passenger and Ground Handling R
Passenger and Ground Handling Revenue | 9 Months Ended |
Sep. 30, 2015 | |
Passenger and Ground Handling Revenues | |
Passenger and Ground Handling Revenue | Note B — Passenger and Ground Handling Revenue The Company recognizes passenger and ground handling revenues when the service is provided under its code-share agreements. Under the Company’s fixed-fee arrangements (referred to as “fixed-fee arrangements, “contract flying” or “capacity purchase agreements”) with Delta Airlines Inc. (“Delta”), United Airlines Inc. (“United”), American Airlines, Inc. (“American”) and Alaska Airlines, Inc. (“Alaska”), the major airline generally pays the Company a fixed-fee for each departure, flight or block time incurred, and an amount per aircraft in service each month with additional incentives based on flight completion and on-time performance. The major airline partner also directly reimburses the Company for certain direct expenses incurred under the fixed-fee arrangement, such as fuel expense and landing fee expenses. Under the fixed-fee arrangements, revenue is earned when each flight is completed and is reflected in passenger revenues. Ground handling revenue primarily consists of customer service functions such as gate and ramp agent services at applicable airports where the Company provides such services to other airlines. Under the Company’s revenue-sharing arrangements (referred to as “revenue-sharing” or “pro-rate” arrangements), the major airline and the Company negotiate a passenger fare proration formula when a passenger has a connecting flight operated by both the Company and the major airline partner, pursuant to which the Company receives a percentage of the ticket revenues for those passengers traveling for the portion of their trip operated by the Company, and the major airline retains the ticket revenues for the other portion of the passengers’ trips on the major airline. Revenue is recognized under the Company’s pro-rate flying agreements when each flight is completed based upon the portion of the pro-rate passenger fare the Company anticipates that it will receive for each completed flight. Other ancillary revenues commonly associated with airlines such as baggage fee revenue, ticket change fee revenue and the marketing component of the sale of mileage credits are retained by the Company’s major airline partners on flights that the Company operates under its code-share agreements. In the event that the contractual rates under the Company’s flying agreements have not been finalized at quarterly or annual financial statement dates, the Company records revenues based on the lower of the prior period’s approved rates, as adjusted to reflect any contract negotiations, and the Company’s estimate of rates that will be implemented in accordance with revenue recognition guidelines. In the event the Company has a reimbursement dispute with a major partner, the Company evaluates the dispute under its established revenue recognition criteria and, provided the revenue recognition criteria have been met, the Company recognizes revenue based on management’s estimate of the resolution of the dispute. In several of the Company’s agreements, the Company is eligible to receive incentive compensation upon the achievement of certain performance criteria. The incentives are defined in the agreements and are measured and determined on a monthly, quarterly or semi-annual basis. At the end of each period during the term of an agreement, the Company calculates the incentives achieved during that period and recognizes revenue attributable to that agreement accordingly. The following table summarizes the significant provisions of each code share agreement the Company has with each major partner: Delta Connection Agreements Agreement Number of aircraft under respective agreement Term / Termination Dates SkyWest Airlines Delta Connection Agreement (fixed-fee arrangement) CRJ 200—48 CRJ 700—19 CRJ 900—36 The contract expires on an individual aircraft basis with expirations that commenced in 2015 The final aircraft expires in 2022 Upon expiration, aircraft may be renewed or extended ExpressJet Delta Connection Agreement (fixed-fee arrangement) CRJ 200—44 CRJ 700—41 CRJ 900—28 The contract expires on an individual aircraft basis with expirations that commenced in 2015 The final aircraft expires in 2022 Upon expiration, aircraft may be renewed or extended SkyWest Airlines Delta Connection Pro-rate Agreement (revenue-sharing arrangement) CRJ 200—14 Terminates with 30-day notice United Express Agreements Agreement Number of aircraft under respective agreement Term / Termination Dates SkyWest Airlines United Express Agreements (fixed-fee arrangement) CRJ 200— 50 CRJ 700— 70 E175— 40 The contract expires on an individual aircraft basis with expirations that commenced in 2015 The final aircraft expires in 2026 Upon expiration, aircraft may be renewed or extended ExpressJet United ERJ Agreement (fixed-fee arrangement) ERJ 135— 5 ERJ 145— 169 The contract expires on an individual aircraft basis with expirations that commenced in 2015 The final aircraft expires in 2017 Upon expiration, aircraft may be renewed or extended SkyWest Airlines United Express Pro-rate Agreement (revenue-sharing arrangement) CRJ 200— 26 Terminates with 120-day notice Alaska Capacity Purchase Agreement Agreement Number of aircraft under respective agreement Term / Termination Dates SkyWest Airlines Alaska Agreement (fixed-fee arrangement) CRJ 700— 9 E175— 3 CRJ 700 portion terminates 2016 E175 portion terminates 2027 Upon expiration, aircraft may be renewed or extended American Agreements Agreement Number of aircraft under respective agreement Term / Termination Dates SkyWest Airlines American Agreement Previously under the US Airways Agreement (fixed-fee arrangement) CRJ 200— 6 Terminates by the end of 2015 Upon expiration, aircraft may be renewed or extended SkyWest Airlines American Agreement Previously under the US Airways Pro-rate Agreement (revenue-sharing arrangement) CRJ 200— 1 Terminated October 2015 SkyWest Airlines American Agreement (fixed-fee arrangement) CRJ 200— 12 Terminates 2016 Upon expiration, aircraft may be renewed or extended SkyWest Airlines American Pro-rate Agreement (revenue-sharing arrangement) CRJ 200— 5 Terminates with 120- day notice ExpressJet American Agreement (fixed-fee arrangement) CRJ 200— 12 ERJ 145— 16 Terminates 2017 Upon expiration, aircraft may be renewed or extended ExpressJet American Pro-rate Agreement (revenue-sharing arrangement) CRJ 200— 2 Terminates with 120- day notice In addition to the contractual arrangements described above, SkyWest Airlines has entered into agreements with Alaska, United and Delta to place additional Embraer E175 dual-class jet (“E175”) aircraft into service for those major partners. In June 2015, SkyWest Airlines reached an agreement with Alaska to place eight additional E175 aircraft into service pursuant to the SkyWest Airlines Alaska Agreement. The Company anticipates that those eight E175 aircraft, when added to the three E175 aircraft in service for Alaska and four additional E175 aircraft that Alaska has agreed to place into service under the SkyWest Airlines Alaska Agreement, will result in a total of 15 E175 aircraft under contract with Alaska. In September 2015, SkyWest Airlines reached an agreement with United to place 18 additional E175 aircraft into service pursuant to the SkyWest Airlines United Express Agreement, which the Company believes will result in a total of 58 E175 aircraft under contract with United. In October 2015, SkyWest Airlines reached an agreement with Delta to place 19 new E175 aircraft into service pursuant to the SkyWest Airlines Delta Connection Agreement. Under the agreement, the Company anticipates that delivery of the E175 aircraft to be flown for Delta will begin in August 2016, with all 19 aircraft being delivered by mid-2017. Other Revenue Items The Company’s passenger and ground handling revenues could be impacted by a number of factors, including changes to the Company’s code-share agreements with its major airline partners, contract modifications resulting from contract re-negotiations, the Company’s ability to earn incentive payments contemplated under the Company’s code-share agreements and settlement of reimbursement disputes with the Company’s major airline partners. |
Share-Based Compensation and St
Share-Based Compensation and Stock Repurchases | 9 Months Ended |
Sep. 30, 2015 | |
Share-Based Compensation and Stock Repurchases | |
Share-Based Compensation and Stock Repurchases | Note C — Share-Based Compensation and Stock Repurchases The fair value of stock options granted by the Company has been estimated as of the grant date using the Black-Scholes option pricing model. The Company uses historical data to estimate option exercises and employee termination in the option pricing model. The expected term of options granted is derived from the output of the option pricing model and represents the period of time that options granted are expected to be outstanding. The expected volatilities are based on the historical volatility of the Company’s traded stock and other factors. During the nine months ended September 30, 2015, the Company granted options to purchase 266,304 shares of common stock under the SkyWest, Inc. 2010 Long-Term Incentive Plan (the “2010 Incentive Plan”). The following table shows the assumptions used and weighted average fair value for stock option grants during the nine months ended September 30, 2015. Expected annual dividend rate % Risk-free interest rate % Average expected life (years) Expected volatility of common stock Forfeiture rate % Weighted average fair value of option grants $ During the nine months ended September 30, 2015, the Company granted 36,950 fully-vested shares of common stock to the Company’s directors. Additionally, during the nine months ended September 30, 2015, the Company granted 407,042 restricted stock units and 224,869 performance restricted stock units to employees of the Company and its subsidiaries under the 2010 Incentive Plan. Both the restricted stock and performance restricted stock units have a three-year vesting period, during which the recipient must remain employed with the Company or one of the Company’s subsidiaries. In addition to the three-year vesting period, certain profit metrics of the Company must be met before the recipient will receive any shares of stock attributable to the performance restricted stock units. Upon vesting, a restricted stock unit and a performance restricted stock unit will be replaced with a share of common stock. The fair value of the restricted stock units on the date of grant was $13.51 per share. The Company records share-based compensation expense only for those options and restricted and performance restricted stock units that are expected to vest. The estimated fair value of the stock options and restricted stock units is amortized over the applicable vesting periods. During the three months ended September 30, 2015 and 2014, the Company recorded pre-tax share-based compensation expense of $1.1 million and $0.9 million, respectively. During the nine months ended September 30, 2015 and 2014, the Company recorded pre-tax share-based compensation expense of $4.0 million and $3.7 million, respectively. The Company repurchased 1.25 million shares of its common stock for $18.7 million during the nine months ended September 30, 2015. The Company repurchased 670,000 shares of its common stock for $8.4 million during the nine months ended September 30, 2014. |
Net Income (Loss) Per Common Sh
Net Income (Loss) Per Common Share | 9 Months Ended |
Sep. 30, 2015 | |
Net Income (Loss) Per Common Share | |
Net Income (Loss) Per Common Share | Note D — Net Income (Loss) Per Common Share Basic net income per common share (“Basic EPS”) excludes dilution and is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted net income per common share (“Diluted EPS”) reflects the potential dilution that could occur if stock options or other contracts to issue common stock were exercised or converted into common stock. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an anti-dilutive effect on net income per common share. During the three and nine months ended September 30, 2015, options to acquire no shares and 672,871 shares, respectively, were excluded from the computation of Diluted EPS as their impact was anti-dilutive. During the three and nine months ended September 30, 2014, options to acquire 2,942,000 and 3,055,000 shares, respectively, were excluded from the computation of Diluted EPS as their impact was anti-dilutive. The calculation of the weighted average number of common shares outstanding for Basic EPS and Diluted EPS for the periods indicated (in thousands, except per share data) is as follows: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (Unaudited) (Unaudited) Numerator Net Income $ $ $ $ Denominator Weighted average number of common shares outstanding Effect of outstanding share-based awards Weighted average number of shares for diluted net income per common share Basic earnings per share $ $ $ $ Diluted earnings per share $ $ $ $ |
Segment Reporting
Segment Reporting | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting | |
Segment Reporting | Note E — Segment Reporting Consistent with generally accepted accounting principles, the Company reports its operating results in two segments, based upon the operations of its two operating subsidiaries, SkyWest Airlines and ExpressJet. The following represents the Company’s segment data for the three-month periods ended September 30, 2015 and 2014 (in thousands). Three months ended September 30, 2015 SkyWest Airlines ExpressJet Corporate / Consolidating Consolidated Operating revenues $ $ $ $ Operating expense Depreciation and amortization expense Interest expense — Segment profit (loss)(1) ) Identifiable intangible assets, other than goodwill — — Total assets — Capital expenditures (including non-cash) — Three months ended September 30, 2014 SkyWest Airlines ExpressJet Corporate / Consolidating Consolidated Operating revenues $ $ $ $ Operating expense ) Depreciation and amortization expense — Interest expense Segment profit (loss)(1) ) ) Identifiable intangible assets, other than goodwill — — Total assets — Capital expenditures (including non-cash) — (1) Segment profit (loss) is equal to operating income less interest expense The following represents the Company’s segment data for the nine-month periods ended September 30, 2015 and 2014 (in thousands). Nine months ended September 30, 2015 SkyWest Airlines ExpressJet Corporate / Consolidating Consolidated Operating revenues $ $ $ $ Operating expense Depreciation and amortization expense Interest expense — Segment profit (loss)(1) ) Identifiable intangible assets, excluding goodwill — — Total assets — Capital expenditures (including non-cash) — Nine months ended September 30, 2014 SkyWest Airlines ExpressJet Corporate / Consolidating Consolidated Operating revenues $ $ $ $ Operating expense ) Depreciation and amortization expense — Interest expense Segment profit (loss)(1) ) ) ) Identifiable intangible assets, other than goodwill — — Total assets — Capital expenditures (including non-cash) — (1) Segment profit (loss) is equal to operating income less interest expense |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies | |
Commitments and Contingencies | Note F — Commitments and Contingencies As of September 30, 2015, the Company leased aircraft, as well as airport facilities, office space, and various other property and equipment under non-cancelable operating leases which are generally on a long-term net rent basis where the Company pays taxes, maintenance, insurance and certain other operating expenses applicable to the leased property. The Company expects that, in the normal course of business, such operating leases that expire will be renewed or replaced by other leases. The following table summarizes future minimum rental payments required under operating leases that had initial or remaining non-cancelable lease terms in excess of one year as of September 30, 2015 (in thousands): October through December 2015 $ 2016 2017 2018 2019 Thereafter $ During the three months ended September 30, 2015, the Company took delivery of five E175 aircraft and financed the aircraft through the issuance of $113.7 million of long-term debt. During the nine months ended September 30, 2015, the Company took delivery of 23 E175s and financed the aircraft through the issuance of $521.2 million of long-term debt. The debt associated with the E175 aircraft delivered during the nine months ended September 30, 2015 has a twelve-year term with a fixed annual interest rate ranging from 3.4% to 4.0% and is secured by the 23 E175 aircraft. As of September 30, 2015 and December 31, 2014, the Company had accrued future lease obligations of $1.5 million and $3.8 million, respectively, associated with Embraer Brasilia EMB120 aircraft (“EMB120s”) removed from service. The lease payments for the EMB120s are scheduled to continue through June 2016. As of September 30, 2015, the Company had a firm purchase commitment for 49 E175 aircraft with scheduled delivery dates from October 2015 to mid-2017. During the nine months ended September 30, 2015, the Company borrowed $25 million from a bank. The debt has a four year term with a fixed annual interest rate of 3.3% with monthly payments and is secured by spare engines. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Measurements | |
Fair Value Measurements | Note G — Fair Value Measurements The Company holds certain assets that are required to be measured at fair value in accordance with GAAP. The Company determined fair value of these assets based on the following three levels of inputs: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Some of the Company’s marketable securities primarily utilize broker quotes in a non-active market for valuation of these securities. Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities, therefore requiring an entity to develop its own assumptions. As of September 30, 2015 and December 31, 2014, the Company held certain assets that are required to be measured at fair value on a recurring basis. Assets measured at fair value on a recurring basis are summarized below (in thousands): Fair Value Measurements as of September 30, 2015 Total Level 1 Level 2 Level 3 Marketable Securities Bonds and bond funds $ $ — $ $ — Asset backed securities — — $ — $ — Cash, Cash Equivalents and Restricted Cash — — Other Assets (a) — — Total Assets Measured at Fair Value $ $ $ $ Fair Value Measurements as of December 31, 2014 Total Level 1 Level 2 Level 3 Marketable Securities Bonds and bond funds $ $ — $ $ — Asset backed securities — — $ — $ — Cash, Cash Equivalents and Restricted Cash — — Other Assets (a) — — Total Assets Measured at Fair Value $ $ $ $ (a) Comprised of auction rate securities which are reflected in “Other assets” in the Company’s unaudited condensed consolidated balance sheets Based on market conditions, the Company uses a discounted cash flow valuation methodology for auction rate securities. Accordingly, for purposes of the foregoing condensed consolidated financial statements, these securities were categorized as Level 3 securities. The Company’s “Marketable Securities” classified as Level 2 primarily utilize broker quotes in a non-active market for valuation of these securities. The Company did not make any significant transfers of securities between Level 1, Level 2 and Level 3 during the nine months ended September 30, 2015. The Company’s policy regarding the recording of transfers between levels is to record any such transfers at the end of the reporting period. As of September 30, 2015 and December 31, 2014, the Company classified $429.8 million and $415.3 million of marketable securities, respectively, as short-term since it had the intent to maintain a liquid portfolio and the ability to redeem the securities within one year. As of September 30, 2015 and December 31, 2014, the cost in the Company’s total cash and cash equivalents and available for sale securities (excluding restricted cash and auction rate securities, net of amortized discounts, recorded as other assets) was $556.5 million and $548.0 million, respectively. As of September 30, 2015 and December 31, 2014, the fair value of the Company’s total cash and cash equivalents and available for sale securities (excluding restricted cash and auction rate securities recorded as other assets), was $556.6 million and $547.5 million, respectively. The following table presents the Company’s assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) at September 30, 2015 (in thousands): Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Auction Rate Securities Balance at January 1, 2015 $ Total realized and unrealized gains or (losses) Included in earnings — Included in other comprehensive income Transferred out — Settlements — Balance at September 30, 2015 $ The fair value of the Company’s long-term debt classified as Level 2 was estimated using discounted cash flow analyses, based on the Company’s current estimated incremental borrowing rates for similar types of borrowing arrangements. The fair value of the Company’s long-term debt is estimated based on current rates offered to the Company for similar debt and was estimated to be $2,129.6 million as of September 30, 2015, as compared to the carrying amount of $2,107.7 million as of September 30, 2015. The fair value of the Company’s long-term debt is estimated based on current rates offered to the Company for similar debt and approximated $1,813.1 million as of December 31, 2014, as compared to the carrying amount of $1,745.8 million as of December 31, 2014. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2015 | |
Income Taxes | |
Income Taxes | Note H — Income Taxes The Company’s estimated annual effective tax rate for the three and nine months ended September 30, 2015 varied from the federal statutory rate of 35% primarily due to the provision for state income taxes and the impact of non-deductible crew per diem meal expenses. |
Legal Matters
Legal Matters | 9 Months Ended |
Sep. 30, 2015 | |
Legal Matters | |
Legal Matters | Note I — Legal Matters The Company is subject to certain legal actions which it considers routine to its business activities. As of September 30, 2015, the Company’s management believed, after consultation with legal counsel, that the ultimate outcome of such legal matters was not likely to have a material adverse effect on the Company’s financial position, liquidity or results of operations. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2015 | |
Recent Accounting Pronouncements | |
Recent Accounting Pronouncements | Note J — Recent Accounting Pronouncements In April 2015, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update No. 2015-03, “Simplifying the Presentation of Debt Issuance Costs” (“ASU No. 2015-03”). In August 2015, ASU No. 2015-03 was amended to modify existing guidance to require the presentation of debt issuance costs in the balance sheet as a deduction from the carrying amount of the related debt liability instead of as a deferred charge. It is effective for annual reporting periods beginning after December 15, 2015, but early adoption is permitted. The Company anticipates reclassifying the unamortized debt issuance costs and present debt net of those unamortized costs on its balance sheet upon adoption of ASU No. 2015-03. In May 2014, the FASB issued Accounting Standards Update No. 2014-09, “Revenue from Contracts with Customers” (“ASU No. 2014-09”). Under ASU No. 2014-09, revenue is recognized at the time a good or service is transferred to a customer for the amount of consideration received for that specific good or service. In July 2015, the FASB deferred the effective date of ASU No. 2014-09 to January 1, 2018. The FASB also proposed permitting early adoption of the standard, but not before January 1, 2017. Entities may use a full retrospective approach or report the cumulative effect as of the date of adoption. The Company’s management is currently evaluating the impact the adoption of ASU No. 2014-09 is anticipated to have on the Company’s consolidated financial statements. |
Passenger and Ground Handling16
Passenger and Ground Handling Revenue (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Delta Connection Agreements | |
Agreements with other airlines | |
Schedule of details of agreements with other airlines | Agreement Number of aircraft under respective agreement Term / Termination Dates SkyWest Airlines Delta Connection Agreement (fixed-fee arrangement) CRJ 200—48 CRJ 700—19 CRJ 900—36 The contract expires on an individual aircraft basis with expirations that commenced in 2015 The final aircraft expires in 2022 Upon expiration, aircraft may be renewed or extended ExpressJet Delta Connection Agreement (fixed-fee arrangement) CRJ 200—44 CRJ 700—41 CRJ 900—28 The contract expires on an individual aircraft basis with expirations that commenced in 2015 The final aircraft expires in 2022 Upon expiration, aircraft may be renewed or extended SkyWest Airlines Delta Connection Pro-rate Agreement (revenue-sharing arrangement) CRJ 200—14 Terminates with 30-day notice |
United Express Agreements | |
Agreements with other airlines | |
Schedule of details of agreements with other airlines | Agreement Number of aircraft under respective agreement Term / Termination Dates SkyWest Airlines United Express Agreements (fixed-fee arrangement) CRJ 200— 50 CRJ 700— 70 E175— 40 The contract expires on an individual aircraft basis with expirations that commenced in 2015 The final aircraft expires in 2026 Upon expiration, aircraft may be renewed or extended ExpressJet United ERJ Agreement (fixed-fee arrangement) ERJ 135— 5 ERJ 145— 169 The contract expires on an individual aircraft basis with expirations that commenced in 2015 The final aircraft expires in 2017 Upon expiration, aircraft may be renewed or extended SkyWest Airlines United Express Pro-rate Agreement (revenue-sharing arrangement) CRJ 200— 26 Terminates with 120-day notice |
Alaska Capacity Purchase Agreement | |
Agreements with other airlines | |
Schedule of details of agreements with other airlines | Agreement Number of aircraft under respective agreement Term / Termination Dates SkyWest Airlines Alaska Agreement (fixed-fee arrangement) CRJ 700— 9 E175— 3 CRJ 700 portion terminates 2016 E175 portion terminates 2027 Upon expiration, aircraft may be renewed or extended |
American Agreements | |
Agreements with other airlines | |
Schedule of details of agreements with other airlines | Agreement Number of aircraft under respective agreement Term / Termination Dates SkyWest Airlines American Agreement Previously under the US Airways Agreement (fixed-fee arrangement) CRJ 200— 6 Terminates by the end of 2015 Upon expiration, aircraft may be renewed or extended SkyWest Airlines American Agreement Previously under the US Airways Pro-rate Agreement (revenue-sharing arrangement) CRJ 200— 1 Terminated October 2015 SkyWest Airlines American Agreement (fixed-fee arrangement) CRJ 200— 12 Terminates 2016 Upon expiration, aircraft may be renewed or extended SkyWest Airlines American Pro-rate Agreement (revenue-sharing arrangement) CRJ 200— 5 Terminates with 120- day notice ExpressJet American Agreement (fixed-fee arrangement) CRJ 200— 12 ERJ 145— 16 Terminates 2017 Upon expiration, aircraft may be renewed or extended ExpressJet American Pro-rate Agreement (revenue-sharing arrangement) CRJ 200— 2 Terminates with 120- day notice |
Share-Based Compensation and 17
Share-Based Compensation and Stock Repurchases (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Share-Based Compensation and Stock Repurchases | |
Schedule of assumptions used and weighted average fair value for stock option grants | Expected annual dividend rate % Risk-free interest rate % Average expected life (years) Expected volatility of common stock Forfeiture rate % Weighted average fair value of option grants $ |
Net Income (Loss) Per Common 18
Net Income (Loss) Per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Net Income (Loss) Per Common Share | |
Schedule of net income (loss) per common share | The calculation of the weighted average number of common shares outstanding for Basic EPS and Diluted EPS for the periods indicated (in thousands, except per share data) is as follows: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (Unaudited) (Unaudited) Numerator Net Income $ $ $ $ Denominator Weighted average number of common shares outstanding Effect of outstanding share-based awards Weighted average number of shares for diluted net income per common share Basic earnings per share $ $ $ $ Diluted earnings per share $ $ $ $ |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting | |
Schedule of Company's segment data | The following represents the Company’s segment data for the three-month periods ended September 30, 2015 and 2014 (in thousands). Three months ended September 30, 2015 SkyWest Airlines ExpressJet Corporate / Consolidating Consolidated Operating revenues $ $ $ $ Operating expense Depreciation and amortization expense Interest expense — Segment profit (loss)(1) ) Identifiable intangible assets, other than goodwill — — Total assets — Capital expenditures (including non-cash) — Three months ended September 30, 2014 SkyWest Airlines ExpressJet Corporate / Consolidating Consolidated Operating revenues $ $ $ $ Operating expense ) Depreciation and amortization expense — Interest expense Segment profit (loss)(1) ) ) Identifiable intangible assets, other than goodwill — — Total assets — Capital expenditures (including non-cash) — (1) Segment profit (loss) is equal to operating income less interest expense The following represents the Company’s segment data for the nine-month periods ended September 30, 2015 and 2014 (in thousands). Nine months ended September 30, 2015 SkyWest Airlines ExpressJet Corporate / Consolidating Consolidated Operating revenues $ $ $ $ Operating expense Depreciation and amortization expense Interest expense — Segment profit (loss)(1) ) Identifiable intangible assets, excluding goodwill — — Total assets — Capital expenditures (including non-cash) — Nine months ended September 30, 2014 SkyWest Airlines ExpressJet Corporate / Consolidating Consolidated Operating revenues $ $ $ $ Operating expense ) Depreciation and amortization expense — Interest expense Segment profit (loss)(1) ) ) ) Identifiable intangible assets, other than goodwill — — Total assets — Capital expenditures (including non-cash) — (1) Segment profit (loss) is equal to operating income less interest expense |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies | |
Schedule of Future Minimum Rental Payments for Operating Leases | The following table summarizes future minimum rental payments required under operating leases that had initial or remaining non-cancelable lease terms in excess of one year as of September 30, 2015 (in thousands): October through December 2015 $ 2016 2017 2018 2019 Thereafter $ |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Measurements | |
Schedule of assets measured at fair value on a recurring basis | As of September 30, 2015 and December 31, 2014, the Company held certain assets that are required to be measured at fair value on a recurring basis. Assets measured at fair value on a recurring basis are summarized below (in thousands): Fair Value Measurements as of September 30, 2015 Total Level 1 Level 2 Level 3 Marketable Securities Bonds and bond funds $ $ — $ $ — Asset backed securities — — $ — $ — Cash, Cash Equivalents and Restricted Cash — — Other Assets (a) — — Total Assets Measured at Fair Value $ $ $ $ Fair Value Measurements as of December 31, 2014 Total Level 1 Level 2 Level 3 Marketable Securities Bonds and bond funds $ $ — $ $ — Asset backed securities — — $ — $ — Cash, Cash Equivalents and Restricted Cash — — Other Assets (a) — — Total Assets Measured at Fair Value $ $ $ $ (a) Comprised of auction rate securities which are reflected in “Other assets” in the Company’s unaudited condensed consolidated balance sheets |
Schedule of fair value measurements using significant unobservable inputs | The following table presents the Company’s assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) at September 30, 2015 (in thousands): Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Auction Rate Securities Balance at January 1, 2015 $ Total realized and unrealized gains or (losses) Included in earnings — Included in other comprehensive income Transferred out — Settlements — Balance at September 30, 2015 $ |
Passenger and Ground Handling22
Passenger and Ground Handling Revenue (Details) | 1 Months Ended | 9 Months Ended | ||
Oct. 31, 2015aircraft | Sep. 30, 2015aircraft | Jun. 30, 2015aircraft | Sep. 30, 2015item | |
Delta Connection Agreements | CRJ 200 | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 48 | |||
Delta Connection Agreements | CRJ 200 | ExpressJet | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 44 | |||
Delta Connection Agreements | CRJ 700 | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 19 | |||
Delta Connection Agreements | CRJ 700 | ExpressJet | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 41 | |||
Delta Connection Agreements | CRJ 900 | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 36 | |||
Delta Connection Agreements | CRJ 900 | ExpressJet | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 28 | |||
Delta Connection Agreements | E 175 | ||||
Agreements with other airlines | ||||
Number of new aircrafts into service | aircraft | 19 | |||
Delta Connection Pro-rate Agreement | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Notice period for termination of agreement | 30 days | |||
Delta Connection Pro-rate Agreement | CRJ 200 | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 14 | |||
United Express Agreements | CRJ 200 | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 50 | |||
United Express Agreements | CRJ 700 | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 70 | |||
United Express Agreements | E 175 | ||||
Agreements with other airlines | ||||
Number of additional aircrafts into service | aircraft | 18 | |||
Number of total aircrafts into service | aircraft | 58 | |||
United Express Agreements | E 175 | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 40 | |||
United Express Agreements | ERJ 145 | ExpressJet | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 169 | |||
United Express Agreements | ERJ135 | ExpressJet | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 5 | |||
United Express Prorate Agreement | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Notice period for termination of agreement | 120 days | |||
United Express Prorate Agreement | CRJ 200 | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 26 | |||
Alaska Capacity Purchase Agreement | CRJ 700 | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 9 | |||
Alaska Capacity Purchase Agreement | E 175 | ||||
Agreements with other airlines | ||||
Number of additional aircrafts into service | aircraft | 8 | |||
Number of agreed additional aircrafts into service | aircraft | 4 | |||
Number of total aircrafts into service | aircraft | 15 | |||
Alaska Capacity Purchase Agreement | E 175 | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 3 | |||
American Agreement Previously under US Airways Agreement | CRJ 200 | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 6 | |||
American Pro-rate Agreement Previously under US Airways Pro-rate Agreement | CRJ 200 | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 1 | |||
American Capacity Purchase Agreement | CRJ 200 | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 12 | |||
American Capacity Purchase Agreement | CRJ 200 | ExpressJet | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 12 | |||
American Capacity Purchase Agreement | ERJ 145 | ExpressJet | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 16 | |||
American Prorate Agreement | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Notice period for termination of agreement | 120 days | |||
American Prorate Agreement | ExpressJet | ||||
Agreements with other airlines | ||||
Term of agreement | 120 days | |||
American Prorate Agreement | CRJ 200 | Sky West Airlines Inc | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 5 | |||
American Prorate Agreement | CRJ 200 | ExpressJet | ||||
Agreements with other airlines | ||||
Number of aircraft under contract | 2 |
Share-Based Compensation and 23
Share-Based Compensation and Stock Repurchases (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 | |
Share-Based Compensation and Stock Repurchases | ||||
Stock based compensation expense | $ 1.1 | $ 0.9 | $ 4 | $ 3.7 |
Common stock repurchased (in shares) | 1,250,000 | 670,000 | ||
Common stock repurchased, value | $ 18.7 | $ 8.4 | ||
Employee Stock Option | ||||
Assumptions used to determine value of the shares purchased under the stock purchase plan using Black-Scholes option pricing model | ||||
Expected annual dividend rate (as a percent) | 1.18% | |||
Risk-free interest rate (as a percent) | 1.62% | |||
Average expected life | 5 years 8 months 12 days | |||
Expected volatility of common stock (as a percent) | 0.401% | |||
Forfeiture rate (as a percent) | 0.00% | |||
Weighted average fair value of option grants | $ 4.75 | |||
Restricted Stock Units (RSUs) | ||||
Assumptions used to determine value of the shares purchased under the stock purchase plan using Black-Scholes option pricing model | ||||
Granted (in dollars per share) | $ 13.51 | |||
Restricted Stock Units (RSUs) | Director | ||||
Assumptions used to determine value of the shares purchased under the stock purchase plan using Black-Scholes option pricing model | ||||
Granted (in shares) | 36,950 | |||
Long Term Incentive Plan 2010 | Employee Stock Option | ||||
Stock Compensation | ||||
Options granted (in shares) | 266,304 | |||
Long Term Incentive Plan 2010 | Restricted Stock Units (RSUs) | ||||
Assumptions used to determine value of the shares purchased under the stock purchase plan using Black-Scholes option pricing model | ||||
Granted (in shares) | 407,042 | |||
Vesting period | 3 years | |||
Long Term Incentive Plan 2010 | Performance Restricted Stock Units | ||||
Assumptions used to determine value of the shares purchased under the stock purchase plan using Black-Scholes option pricing model | ||||
Granted (in shares) | 224,869 | |||
Vesting period | 3 years |
Net Income (Loss) Per Common 24
Net Income (Loss) Per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Net Income (Loss) Per Common Share | ||||
Number of outstanding options not included in computation of Diluted EPS (in shares) | 0 | 2,942,000 | 672,871 | 3,055,000 |
Numerator | ||||
Net Income | $ 36,268 | $ 41,338 | $ 77,363 | $ 3,713 |
Denominator | ||||
Weighted average number of common shares outstanding | 50,616,000 | 51,322,000 | 51,143,000 | 51,324,000 |
Effect of outstanding share-based awards | 666,000 | 714,000 | 739,000 | 238,000 |
Weighted average number of shares for diluted net income per common share | 51,282,000 | 52,036,000 | 51,882,000 | 51,562,000 |
Basic earnings per share (in dollars per share) | $ 0.72 | $ 0.81 | $ 1.51 | $ 0.07 |
Diluted earnings per share (in dollars per share) | $ 0.71 | $ 0.79 | $ 1.49 | $ 0.07 |
Segment Reporting (Details)
Segment Reporting (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)segment | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($) | ||
Segment Reporting | ||||||
Operating segments number | segment | 2 | |||||
Number of operating subsidiaries representing operating segments | segment | 2 | |||||
Segment Reporting | ||||||
Operating revenues | $ 794,004 | $ 834,633 | $ 2,342,819 | $ 2,423,592 | ||
Operating expense | 715,708 | 775,553 | 2,160,515 | 2,379,044 | ||
Depreciation and amortization expense | 66,603 | 65,822 | 196,953 | 192,389 | ||
Interest expense | 19,914 | 16,883 | 56,460 | 48,697 | ||
Segment profit (loss) | 59,763 | 68,344 | 128,561 | 20,168 | ||
Identifiable intangible assets, other than goodwill | 11,061 | 13,311 | 11,061 | 13,311 | $ 12,748 | |
Total assets | 4,926,443 | 4,397,632 | 4,926,443 | 4,397,632 | $ 4,409,928 | |
Capital expenditures (including non - cash) | 149,504 | 192,830 | 672,574 | 506,364 | ||
Corporate/Consolidating | ||||||
Segment Reporting | ||||||
Operating revenues | 6,439 | 474 | 15,414 | 1,422 | ||
Operating expense | 651 | (77) | 2,355 | (97) | ||
Depreciation and amortization expense | 262 | 787 | ||||
Interest expense | 699 | 2,208 | ||||
SkyWest Airlines | ||||||
Segment Reporting | ||||||
Operating revenues | 504,531 | 493,606 | 1,430,722 | 1,416,149 | ||
Operating expense | 428,116 | 430,024 | 1,246,378 | 1,289,218 | ||
Depreciation and amortization expense | 44,766 | 43,853 | 131,249 | 125,811 | ||
Interest expense | 17,048 | 11,492 | 46,515 | 32,180 | ||
Total assets | 3,523,549 | 2,825,243 | 3,523,549 | 2,825,243 | ||
Capital expenditures (including non - cash) | 144,367 | 186,678 | 652,714 | 487,711 | ||
Express Jet Airlines Inc | ||||||
Segment Reporting | ||||||
Operating revenues | 283,034 | 340,553 | 896,683 | 1,006,021 | ||
Operating expense | 286,941 | 345,606 | 911,782 | 1,089,923 | ||
Depreciation and amortization expense | 21,575 | 21,969 | 64,917 | 66,578 | ||
Interest expense | 2,866 | 4,692 | 9,945 | 14,309 | ||
Identifiable intangible assets, other than goodwill | 11,061 | 13,311 | 11,061 | 13,311 | ||
Total assets | 1,402,894 | 1,572,389 | 1,402,894 | 1,572,389 | ||
Capital expenditures (including non - cash) | 5,137 | 6,152 | 19,860 | 18,653 | ||
Segment [Member] | ||||||
Segment Reporting | ||||||
Segment profit (loss) | [1] | 58,382 | 42,197 | 125,844 | (4,149) | |
Segment [Member] | Corporate/Consolidating | ||||||
Segment Reporting | ||||||
Segment profit (loss) | [1] | 5,788 | (148) | 13,059 | (689) | |
Segment [Member] | SkyWest Airlines | ||||||
Segment Reporting | ||||||
Segment profit (loss) | [1] | 59,367 | 52,090 | 137,829 | 94,751 | |
Segment [Member] | Express Jet Airlines Inc | ||||||
Segment Reporting | ||||||
Segment profit (loss) | [1] | $ (6,773) | $ (9,745) | $ (25,044) | $ (98,211) | |
[1] | Segment profit (loss) is equal to operating income less interest expense |
Commitments and Contingencies26
Commitments and Contingencies (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2015USD ($)aircraft | Sep. 30, 2015USD ($)aircraft | Dec. 31, 2014USD ($) | |
Supply Commitment [Line Items] | |||
Long-term debt amount | $ 25,000 | $ 25,000 | |
Debt Instrument, Term | 4 years | ||
Interest rate (as a percent) | 3.30% | 3.30% | |
Future minimum rental payments required under operating leases | |||
October through December 2015 | $ 93,236 | $ 93,236 | |
2,016 | 267,353 | 267,353 | |
2,017 | 191,506 | 191,506 | |
2,018 | 153,042 | 153,042 | |
2,019 | 120,072 | 120,072 | |
Thereafter | 472,800 | 472,800 | |
Total future lease obligations | $ 1,298,009 | $ 1,298,009 | |
E 175 | |||
Supply Commitment [Line Items] | |||
Number of aircrafts committed to purchase | aircraft | 49 | ||
Number of aircraft delivered | aircraft | 5 | 23 | |
Debt issued to purchase of aircraft | $ 113,700 | $ 521,200 | |
Debt Instrument, Term | 12 years | ||
E 175 | Minimum | |||
Supply Commitment [Line Items] | |||
Interest rate (as a percent) | 3.40% | 3.40% | |
E 175 | Maximum | |||
Supply Commitment [Line Items] | |||
Interest rate (as a percent) | 4.00% | 4.00% | |
EMB 120 | |||
Future minimum rental payments required under operating leases | |||
Total future lease obligations | $ 1,500 | $ 1,500 | $ 3,800 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2015 | Dec. 31, 2014 | ||
Fair Value Measurements | |||
Marketable securities | $ 429,806 | $ 415,273 | |
Auction Rate Securities | |||
Changes in assets measured at fair value on a recurring basis using significant unobservable inputs (level 3) | |||
Balance at the beginning of the period | 2,309 | ||
Total realized and unrealized gains or (losses) Included in other comprehensive income | 4 | ||
Balance at the end of the period | 2,313 | ||
Recurring | |||
Fair Value Measurements | |||
Marketable securities | 429,806 | 415,273 | |
Cash, Cash Equivalents and Restricted Cash | 138,328 | 143,857 | |
Other Assets | 2,313 | 2,309 | |
Total Assets Measured at Fair Value | 570,447 | 561,439 | |
Cost of cash and cash equivalents and available for sale securities | 556,500 | 548,000 | |
Fair value of cash and cash equivalents and available for sale securities | 556,600 | 547,500 | |
Recurring | Bonds and bond funds | |||
Fair Value Measurements | |||
Marketable securities | 429,756 | 410,163 | |
Recurring | Asset-backed Securities | |||
Fair Value Measurements | |||
Marketable securities | 50 | 5,110 | |
Recurring | Level 1 | |||
Fair Value Measurements | |||
Cash, Cash Equivalents and Restricted Cash | 138,328 | 143,857 | |
Total Assets Measured at Fair Value | 138,328 | 143,857 | |
Recurring | Level 2 | |||
Fair Value Measurements | |||
Marketable securities | 429,806 | 415,273 | |
Total Assets Measured at Fair Value | 429,806 | 415,273 | |
Fair Value of Financial Instruments | |||
Fair value of long-term debt | 2,129,600 | 1,813,100 | |
Carrying amount of long-term debt | 2,107,700 | 1,745,800 | |
Recurring | Level 2 | Bonds and bond funds | |||
Fair Value Measurements | |||
Marketable securities | 429,756 | 410,163 | |
Recurring | Level 2 | Asset-backed Securities | |||
Fair Value Measurements | |||
Marketable securities | 50 | 5,110 | |
Recurring | Level 3 | |||
Fair Value Measurements | |||
Other Assets | 2,313 | 2,309 | [1] |
Total Assets Measured at Fair Value | $ 2,313 | $ 2,309 | |
[1] | Comprised of auction rate securities which is reflected in “Other assets” in the Company’s unaudited condensed consolidated balance sheets |
Income Taxes (Details)
Income Taxes (Details) | 9 Months Ended |
Sep. 30, 2015 | |
Income Taxes | |
Statutory Federal income tax rate (as a percent) | 35.00% |