Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Feb. 12, 2019 | Jun. 29, 2018 | |
Document and Entity Information | |||
Entity Registrant Name | SKYWEST INC | ||
Entity Central Index Key | 793,733 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 2,701,175,567 | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Ex Transition Period | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 51,635,965 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 328,384 | $ 181,792 |
Marketable securities | 360,945 | 503,503 |
Income tax receivable | 25,936 | 5,316 |
Receivables, net | 64,194 | 42,731 |
Inventories, net | 127,690 | 119,755 |
Prepaid aircraft rents | 87,031 | 115,098 |
Other current assets | 26,614 | 26,938 |
Total current assets | 1,020,794 | 995,133 |
PROPERTY AND EQUIPMENT: | ||
Aircraft and rotable spares | 6,433,916 | 5,335,870 |
Deposits on aircraft | 42,012 | 49,000 |
Buildings and ground equipment | 291,544 | 265,608 |
Total property and equipment, gross | 6,767,472 | 5,650,478 |
Less-accumulated depreciation and amortization | (1,761,728) | (1,467,475) |
Total property and equipment, net | 5,005,744 | 4,183,003 |
OTHER ASSETS: | ||
Long-term prepaid assets | 181,830 | 230,923 |
Other long-term assets | 104,844 | 65,341 |
Total other assets | 286,674 | 296,264 |
Total assets | 6,313,212 | 5,474,400 |
CURRENT LIABILITIES: | ||
Current maturities of long-term debt | 350,206 | 309,678 |
Accounts payable | 331,982 | 288,904 |
Accrued salaries, wages and benefits | 161,606 | 154,367 |
Taxes other than income taxes | 16,024 | 19,228 |
Other current liabilities | 65,008 | 48,648 |
Total current liabilities | 924,826 | 820,825 |
OTHER LONG-TERM LIABILITIES | 66,870 | 58,662 |
LONG-TERM DEBT, net of current maturities | 2,809,768 | 2,377,346 |
DEFERRED INCOME TAXES PAYABLE | 518,159 | 419,020 |
DEFERRED AIRCRAFT CREDITS | 29,308 | 44,225 |
COMMITMENTS AND CONTINGENCIES (Note 5) | ||
STOCKHOLDERS' EQUITY: | ||
Preferred stock, 5,000,000 shares authorized; none issued | ||
Common stock, no par value, 120,000,000 shares authorized; 81,239,289 and 80,398,104 shares issued, respectively | 690,910 | 672,593 |
Retained earnings | 1,776,585 | 1,516,957 |
Treasury stock, at cost, 29,850,999 and 28,643,535 shares, respectively | (503,182) | (435,178) |
Accumulated other comprehensive loss | (32) | (50) |
Total stockholders' equity | 1,964,281 | 1,754,322 |
Total liabilities and stockholders' equity | $ 6,313,212 | $ 5,474,400 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2018 | Dec. 31, 2017 |
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 | 81,239,289 | 80,398,104 |
Treasury stock, at cost, shares | 29,850,999 | 28,643,535 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2018 | Dec. 31, 2017 | [1] | Dec. 31, 2016 | |||
OPERATING REVENUES: | ||||||
Total operating revenues | $ 3,221,679 | $ 3,122,592 | $ 3,063,702 | [1] | ||
OPERATING EXPENSES: | ||||||
Salaries, wages and benefits | 1,201,518 | 1,192,067 | 1,205,459 | [1] | ||
Depreciation and amortization | 334,589 | 292,768 | 284,969 | [1] | ||
Special items | [1] | 465,649 | ||||
Other operating expenses | 272,826 | 250,778 | 255,559 | [1] | ||
Total operating expenses | 2,747,399 | 2,734,393 | 3,236,386 | [1] | ||
OPERATING INCOME (LOSS) | 474,280 | 388,199 | (172,684) | [1] | ||
OTHER INCOME (EXPENSE): | ||||||
Interest income | 8,823 | 4,509 | 2,143 | [1] | ||
Interest expense | (120,409) | (104,925) | (78,177) | [1] | ||
Other, net | 3,620 | 400 | (94) | [1] | ||
Total other expense, net | (107,966) | (100,016) | (76,128) | [1] | ||
INCOME (LOSS) BEFORE INCOME TAXES | 366,314 | 288,183 | (248,812) | [1] | ||
PROVISION (BENEFIT) FOR INCOME TAXES | 85,942 | (140,724) | (87,226) | [1] | ||
NET INCOME (LOSS) | $ 280,372 | $ 428,907 | $ (161,586) | [1] | ||
BASIC EARNINGS (LOSS) PER SHARE (in dollars per share) | $ 5.40 | $ 8.28 | $ (3.14) | [1] | ||
DILUTED EARNINGS (LOSS) PER SHARE (in dollars per share) | $ 5.30 | $ 8.08 | $ (3.14) | [1] | ||
Weighted average common shares: | ||||||
Basic (in shares) | 51,914 | 51,804 | 51,505 | [1] | ||
Diluted (in shares) | 52,871 | 53,100 | 51,505 | [1] | ||
COMPREHENSIVE INCOME (LOSS): | ||||||
Net income (loss) | $ 280,372 | $ 428,907 | $ (161,586) | [1] | ||
Net unrealized appreciation on marketable securities, net of taxes | 18 | 21 | 189 | [1] | ||
TOTAL COMPREHENSIVE INCOME (LOSS) | 280,390 | 428,928 | (161,397) | [1] | ||
Flying agreements | ||||||
OPERATING REVENUES: | ||||||
Total operating revenues | 3,169,520 | 3,078,297 | 3,010,738 | [1] | ||
Airport customer service and other | ||||||
OPERATING REVENUES: | ||||||
Total operating revenues | 52,159 | 44,295 | 52,964 | [1] | ||
Aircraft maintenance, materials and repairs | ||||||
OPERATING EXPENSES: | ||||||
Total operating expenses | 556,259 | 579,463 | 569,306 | [1] | ||
Aircraft rentals | ||||||
OPERATING EXPENSES: | ||||||
Total operating expenses | 154,945 | 215,807 | 262,602 | [1] | ||
Aircraft fuel | ||||||
OPERATING EXPENSES: | ||||||
Total operating expenses | 117,657 | 85,136 | 70,701 | [1] | ||
Airport related expenses | ||||||
OPERATING EXPENSES: | ||||||
Total operating expenses | $ 109,605 | $ 118,374 | $ 122,141 | [1] | ||
[1] | Amounts adjusted due to the adoption of Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606). See Note 1 to the financial statements of this report for additional information. |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Common Stock | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Income (Loss) | Total | |
Balance at Dec. 31, 2015 | $ 641,643 | $ 1,275,142 | $ (410,090) | $ (260) | $ 1,506,435 | |
Balance (in shares) at Dec. 31, 2015 | 79,020 | (28,015) | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | (161,586) | (161,586) | [1] | |||
Net unrealized appreciation on marketable securities, net of taxes | 189 | 189 | [1] | |||
Exercise of common stock options and vested restricted stock units | $ 4,979 | 4,979 | ||||
Exercise of common stock options and vested restricted stock units (in shares) | 609 | |||||
Sale of common stock under employee stock purchase plan | $ 3,163 | 3,163 | ||||
Sale of common stock under employee stock purchase plan (in shares) | 152 | |||||
Stock based compensation expense related to the issuance of stock options and restricted stock units | $ 7,568 | 7,568 | ||||
Cash dividends declared (per share) | (9,805) | (9,805) | ||||
Balance at Dec. 31, 2016 | $ 657,353 | 1,103,751 | $ (410,090) | (71) | 1,350,943 | |
Balance (in shares) at Dec. 31, 2016 | 79,781 | (28,015) | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 428,907 | 428,907 | [1] | |||
Net unrealized appreciation on marketable securities, net of taxes | 21 | 21 | [1] | |||
Exercise of common stock options and vested restricted stock units | $ 1,658 | 1,658 | ||||
Exercise of common stock options and vested restricted stock units (in shares) | 529 | |||||
Treasury shares acquired from vested employee stock awards for income tax withholdings | $ (5,080) | (5,080) | ||||
Treasury shares acquired from vested employee stock awards for income tax withholdings (in shares) | (145) | |||||
Sale of common stock under employee stock purchase plan | $ 3,002 | 3,002 | ||||
Sale of common stock under employee stock purchase plan (in shares) | 88 | |||||
Stock based compensation expense related to the issuance of stock options and restricted stock units | $ 10,580 | 10,580 | ||||
Impact of adoption of Accounting Standards Update (ASU) 2016-09 (See Note 1) | 867 | 867 | ||||
Treasury stock purchases | $ (20,008) | (20,008) | ||||
Treasury stock purchases (in shares) | (484) | |||||
Cash dividends declared (per share) | (16,568) | (16,568) | ||||
Balance at Dec. 31, 2017 | $ 672,593 | 1,516,957 | $ (435,178) | (50) | 1,754,322 | |
Balance (in shares) at Dec. 31, 2017 | 80,398 | (28,644) | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 280,372 | 280,372 | ||||
Net unrealized appreciation on marketable securities, net of taxes | 18 | 18 | ||||
Exercise of common stock options and vested restricted stock units | $ 2,174 | 2,174 | ||||
Exercise of common stock options and vested restricted stock units (in shares) | 780 | |||||
Treasury shares acquired from vested employee stock awards for income tax withholdings | $ (13,556) | (13,556) | ||||
Treasury shares acquired from vested employee stock awards for income tax withholdings (in shares) | (239) | |||||
Sale of common stock under employee stock purchase plan | $ 3,038 | 3,038 | ||||
Sale of common stock under employee stock purchase plan (in shares) | 61 | |||||
Stock based compensation expense related to the issuance of stock options and restricted stock units | $ 13,105 | 13,105 | ||||
Treasury stock purchases | $ (54,448) | (54,448) | ||||
Treasury stock purchases (in shares) | (968) | |||||
Cash dividends declared (per share) | (20,744) | (20,744) | ||||
Balance at Dec. 31, 2018 | $ 690,910 | $ 1,776,585 | $ (503,182) | $ (32) | $ 1,964,281 | |
Balance (in shares) at Dec. 31, 2018 | 81,239 | (29,851) | ||||
[1] | Amounts adjusted due to the adoption of Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606). See Note 1 to the financial statements of this report for additional information. |
CONSOLIDATED STATEMENTS OF ST_2
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY | |||
Net unrealized appreciation on marketable securities, tax | $ 6 | $ 7 | $ 98 |
Cash dividends declared (in dollars per share) | $ 0.40 | $ 0.32 | $ 0.19 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||
Net income (loss) | $ 280,372 | $ 428,907 | $ (161,586) | |||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||
Depreciation and amortization | 334,589 | 292,768 | [1] | 284,969 | [1] | |
Stock based compensation expense | 13,105 | 10,580 | 7,568 | |||
Gain from early extinguishment of debt | (1,279) | |||||
Special items | [1] | 465,649 | ||||
Net increase (decrease) in deferred income taxes | 99,139 | (145,517) | (83,441) | |||
Changes in operating assets and liabilities: | ||||||
Decrease (increase) in restricted cash | 8,243 | (27) | ||||
Decrease (increase) in receivables | (21,464) | 4,201 | 15,260 | |||
Decrease (increase) in income tax receivable | (20,620) | 1,673 | (4,118) | |||
Increase in inventories | (7,935) | (1,246) | (1,986) | |||
Decrease in other current assets | 77,484 | 26,017 | 37,569 | |||
Decrease in deferred aircraft credits | (14,243) | (8,520) | (8,108) | |||
Increase (decrease) in accounts payable and accrued aircraft rents | 56,076 | 46,934 | (47,563) | |||
Increase in other current liabilities | 6,031 | 20,084 | 3,758 | |||
NET CASH PROVIDED BY OPERATING ACTIVITIES | 802,534 | 684,124 | 506,665 | |||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||
Purchases of marketable securities | (2,308,768) | (1,533,867) | (2,511,388) | |||
Sales of marketable securities | 2,451,344 | 1,440,283 | 2,388,168 | |||
Proceeds from the sale of aircraft, property and equipment | 51,994 | 3,008 | ||||
Proceeds from settlement of residual value guarantee aircraft agreements | 90,000 | |||||
Acquisition of property and equipment: | ||||||
Aircraft and rotable spare parts | (1,062,380) | (661,176) | (1,138,963) | |||
Deposits on aircraft | (41,937) | (46,733) | (650) | |||
Buildings and ground equipment | (34,397) | (27,467) | (14,350) | |||
Return of deposits applied towards acquired aircraft | 49,550 | 36,533 | ||||
Decrease (increase) in other assets | (36,816) | (10,904) | 7,097 | |||
NET CASH USED IN INVESTING ACTIVITIES | (983,404) | (751,337) | (1,177,078) | |||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||
Proceeds from issuance of long-term debt | 784,665 | 471,677 | 926,069 | |||
Principal payments on long-term debt | (370,775) | (330,258) | (302,158) | |||
Proceeds from issuance of common stock | 5,212 | 4,660 | 8,142 | |||
Purchase of treasury stock | (54,448) | (20,008) | ||||
Employee income tax paid on vested equity awards | (13,556) | (5,080) | ||||
Decrease (increase) in debt issuance cost | (3,892) | (3,737) | (8,653) | |||
Payment of cash dividends | (19,744) | (15,015) | (9,256) | |||
NET CASH PROVIDED BY FINANCING ACTIVITIES | 327,462 | 102,239 | 614,144 | |||
Increase (decrease) in cash and cash equivalents | 146,592 | 35,026 | (56,269) | |||
Cash and cash equivalents at beginning of period | 181,792 | 146,766 | 203,035 | |||
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 328,384 | 181,792 | 146,766 | |||
Non-cash investing activities: | ||||||
Acquisition of rotable spare parts | 367 | 755 | 5,688 | |||
Debt assumed on aircraft acquired off lease | 59,132 | |||||
Cash paid during the period for: | ||||||
Interest, net of capitalized amounts | 118,268 | 105,639 | 76,589 | |||
Income taxes | $ 2,661 | $ 5,010 | $ 1,212 | |||
[1] | Amounts adjusted due to the adoption of Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606). See Note 1 to the financial statements of this report for additional information. |
Nature of Operations and Summar
Nature of Operations and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2018 | |
Nature of Operations and Summary of Significant Accounting Policies | |
Nature of Operations and Summary of Significant Accounting Policies | (1) Nature of Operations and Summary of Significant Accounting Policies SkyWest, Inc. (the “Company”), through its subsidiaries, SkyWest Airlines, Inc. (“SkyWest Airlines”) and ExpressJet Airlines, Inc. (“ExpressJet”), operates the largest regional airlines in the United States. As of December 31, 2018, SkyWest Airlines and ExpressJet offered scheduled passenger service under code-share agreements with United, Delta, American and Alaska with approximately 2,770 total daily departures to different destinations in the United States, Canada, Mexico and the Caribbean. Additionally, the Company provides airport customer service and ground handling services for other airlines throughout its system. Subsequent to December 31, 2018, the Company sold ExpressJet to a third party. See Note 12, Subsequent Events , for additional information regarding the sale of ExpressJet. As of December 31, 2018, the Company had 596 aircraft in scheduled service out of a combined fleet of 628 aircraft consisting of the following (which included 100 Embraer ERJ145 regional jet (“ERJ145s”) aircraft, 16 Bombardier CRJ200 regional jet (“CRJ200s”) aircraft and 10 Bombardier CRJ700 regional jet (“CRJ700”) aircraft operated by ExpressJet): CRJ200 CRJ700 CRJ900 ERJ145 E175 Total United 106 19 — 100 65 290 Delta 87 22 41 — 49 199 American 7 68 — — — 75 Alaska — — — — 32 32 Aircraft in scheduled service 200 109 41 100 146 596 Subleased to an un-affiliated entity 4 — — — — 4 Other* 4 19 — 5 — 28 Total Fleet 208 128 41 105 146 628 * As of December 31, 2018, these aircraft have been removed from service and are in the process of being returned under the applicable leasing arrangement or are aircraft transitioning between code-share agreements with the Company’s major airline partners. For the year ended December 31, 2018, approximately 48.6% of the Company’s aircraft in scheduled service operated for United, approximately 33.4% was operated for Delta, approximately 12.6% was operated for American and approximately 5.4% was operated for Alaska. SkyWest Airlines has been a code-share partner with Delta since 1987, United since 1997, Alaska since 2011 and American since 2012. As of December 31, 2018, SkyWest Airlines operated as a Delta Connection carrier primarily in Salt Lake City and Minneapolis, a United Express carrier primarily in Los Angeles, San Francisco, Denver, Houston, Chicago and the Pacific Northwest, an American carrier primarily in Chicago, Los Angeles and Phoenix and an Alaska carrier primarily in the Pacific Northwest. As of December 31, 2018, ExpressJet operated as a United Express carrier primarily in Chicago (O’Hare), Cleveland, Newark and Houston and an American carrier primarily in Dallas. The Company’s subsidiaries operate the following aircraft manufactured by Bombardier Aerospace (“Bombardier”) and Embraer S.A. (“Embraer”): CRJ200s, CRJ700s, Bombardier CRJ900 regional jets (“CRJ900s”), “ERJ145s and Embraer E175 dual-class regional jet aircraft (which are typically configured with 70 or 76 seats) (“E175s”). Basis of Presentation The Company’s consolidated financial statements include the accounts of the Company and the SkyWest Airlines, ExpressJet and SkyWest Leasing segments, with all inter‑company transactions and balances having been eliminated. In preparing the accompanying consolidated financial statements, the Company has reviewed, as determined necessary by the Company’s management, events that have occurred after December 31, 2018, through the filing date of the Company’s annual report with the U.S. Securities and Exchange Commission. The Company reclassified certain prior period amounts to conform to the current period presentation (see Recent Accounting Pronouncements). Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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 could differ from those estimates. Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. The Company had no restricted cash as of December 31, 2018 and 2017. Marketable Securities The Company’s investments are classified as available-for-sale and are reported at fair market value with the net unrealized appreciation reported as a component of accumulated other comprehensive income (loss) in stockholders’ equity. At the time of sale, any realized appreciation or depreciation, calculated by the specific identification method, is recognized in other income and expense. The Company’s position in marketable securities as of December 31, 2018 and 2017 was as follows (in thousands): Gross unrealized Gross unrealized At December 31, 2018 Amortized Cost holding gains holding losses Fair market value Total cash and cash equivalents $ 328,384 $ — $ — $ 328,384 Marketable securities: Bond and bond funds $ 229,825 $ — $ (42) $ 229,783 Commercial Paper 131,163 — (1) 131,162 Total marketable securities $ 360,988 $ — $ (43) $ 360,945 Total assets measured at fair value $ 689,372 $ — $ (43) $ 689,329 Gross unrealized Gross unrealized At December 31, 2017 Amortized Cost holding gains holding losses Fair market value Total cash and cash equivalents $ 181,792 $ — $ — $ 181,792 Marketable securities: Bond and bond funds $ 344,479 $ — $ (228) $ 344,251 Commercial Paper 159,252 — — 159,252 Total marketable securities $ 503,731 $ — $ (228) $ 503,503 Total assets measured at fair value $ 685,523 $ — $ (228) $ 685,295 As of December 31, 2018 and 2017, the Company had classified $360.9 million and $503.5 million of marketable securities, respectively, as short‑term since it had the ability to redeem the securities within one year. Inventories Inventories include expendable parts, fuel and supplies and are valued at cost (FIFO basis) less an allowance for obsolescence based on historical results, excess parts and management’s expectations of future operations. Expendable inventory parts are charged to expense as used. An obsolescence allowance for flight equipment expendable parts is accrued based on estimated lives of the corresponding fleet types and salvage values. The inventory allowance as of December 31, 2018 and 2017 was $22.1 million and $17.1 million, respectively. These allowances are based on management estimates. Property and Equipment Property and equipment are stated at cost and depreciated over their useful lives to their estimated residual values using the straight‑line method as follows: Assets Depreciable Life Current Residual Value Aircraft, rotable spares, and spare engines up to 22 years up to 20 % Ground equipment up to 10 years 0 % Office equipment up to 7 years % Leasehold improvements Shorter of 15 years or lease term % Buildings 20 - 39.5 years % Impairment of Long-Lived Assets As of December 31, 2018, the Company had approximately $5.0 billion of property and equipment and related assets. In accounting for these long‑lived and intangible assets, the Company makes estimates about the expected useful lives of the assets, the expected residual values of certain of these assets, and the potential for impairment based on the fair value of the assets and the cash flows they generate. Factors indicating potential impairment include, but are not limited to, significant decreases in the market value of the long‑lived assets, a significant change in the condition of the long‑lived assets and operating cash flow losses associated with the use of the long‑lived assets. On a periodic basis, the Company evaluates whether impairment indicators are present. When considering whether or not impairment of long‑lived assets exists, the Company groups similar assets together at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities and compare the undiscounted cash flows for each asset group to the net carrying amount of the assets supporting the asset group. Asset groupings are done at the fleet or contract level. The Company did not recognize any impairment charges of long-lived assets during the years ended December 31, 2018 and 2017. During the year ended December 31, 2016, the Company impaired certain long-lived assets relating to the CRJ200 aircraft and ERJ145 aircraft type specific assets. See Note 7, Special Items . Capitalized Interest Interest is capitalized on aircraft purchase deposits as a portion of the cost of the asset and is depreciated over the estimated useful life of the asset. During the years ended December 31, 2018, 2017 and 2016, the Company capitalized interest costs of approximately $1.5 million, $1.4 million, and $1.5 million, respectively. Maintenance The Company operates under a U.S. Federal Aviation Administration approved continuous inspection and maintenance program. The Company uses the direct expense method of accounting for its regional jet engine overhauls wherein the expense is recorded when the overhaul event occurs. The Company has engine services agreements with third-party vendors to provide long-term engine services covering the scheduled and unscheduled repairs for most of its CRJ200 aircraft, CRJ700 aircraft, ERJ145 aircraft and E175 aircraft. Under the terms of the agreements, the Company pays a fixed dollar amount per engine hour flown on a monthly basis and the third-party vendors will assume the responsibility to repair the engines at no additional cost to the Company, subject to certain specified exclusions. Maintenance costs under these contracts are recognized when the engine hour is flown pursuant to the terms of each contract. The costs of maintenance for airframe and avionics components, landing gear and other recurring maintenance are expensed as incurred. Flying Agreements and Airport Customer Service and Other Revenues In May 2014, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update No. 2014‑09, “Revenue from Contracts with Customers, (Topic 606)” (“Topic 606”). Under Topic 606, 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. The Company adopted this standard as of January 1, 2018, utilizing the full retrospective method of adoption allowed by the standard, in order to provide for comparative results in all periods presented. Under the new standard, the Company concluded that the individual flights are distinct services and the flight services promised in a capacity purchase agreement represent a series of services that should be accounted for as a single performance obligation, recognized over time as the flights are completed. Performance obligations are deemed met upon the completion of each individual flight. The major airline partners make provisional cash payments to the Company during each month of service based on monthly flight schedules and the provisional cash payments are reconciled based on actual completed flights after each month’s flight activity is completed. The compensation associated with the use of the aircraft under the Company’s fixed-fee agreements is considered lease revenue as the agreements identify the “right of use” of a specific type and number of aircraft over the agreement term and was not impacted by the adoption of ASC 606. The adoption of Topic 606 did not have a material impact on recorded amounts when applied to the opening balance sheet as of January 1, 2018. The adoption of Topic 606 only affected the Company’s consolidated balance sheets and statements of comprehensive income classification, with no impact on the Company’s operating income (loss), net income (loss), earnings (loss) per share or cash flows, however the principal versus agent considerations under Topic 606 resulted in the Company recording directly reimbursed fuel expense under its fixed-fee contracts as a reduction to the applicable operating expense (net) rather than revenue (gross). This classification change resulted in a reduction to total revenue and a reduction to operating expenses by the same amount, resulting in no change to operating income. Additionally, under the nonrefundable up-front fees and contract costs considerations of Topic 606, reimbursements from the Company’s major airline partners for up-front contract costs will be deferred and amortized over the contract term. The related up-front costs to obtain the contract will also be capitalized and amortized over the contract term. As the amount of the up-front reimbursement is determined from the Company’s actual costs to fulfill the contract, this change did not impact the Company’s operating income (loss) as the amount of deferred revenue and the amount of capitalized costs will be recognized over the same period. This change also resulted in a deferred revenue liability and a capitalized contract cost on the balance sheet of the same amount. The Company recognizes flying agreements and airport customer service and other revenues when the service is provided under its code-share agreements. Under the Company’s fixed-fee arrangements (referred to as “fixed-fee arrangements, “fixed-fee contracts” or “capacity purchase agreements”) with Delta, United, American and Alaska ( each, a “major airline partner”), the major airline partner generally pays the Company a fixed-fee for each departure, flight hour (measured from takeoff to landing, excluding taxi time) or block hour (measured from takeoff to landing, including taxi 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 airport landing fees and airport rents. Under the fixed-fee arrangements, revenue is earned when each flight is completed and is reflected in flying agreements revenue. The transaction price for the fixed-fee agreements is determined from the fixed-fee consideration, incentive consideration and directly reimbursed expenses earned as flights are completed over the agreement term. A portion of the Company’s compensation under its fixed-fee agreements is designed to reimburse the Company for certain aircraft ownership costs. The consideration for aircraft ownership costs varies by agreement, but is intended to cover either the Company’s aircraft principal and interest debt service costs, its aircraft depreciation and interest expense or its aircraft lease expense costs while the aircraft is under contract. The consideration received for the use of the aircraft under the Company’s fixed-fee agreements is reflected as lease revenue, inasmuch as the agreements identify the “right of use” of a specific type and number of aircraft over a stated period of time. The amount of compensation deemed to be lease revenue is determined from the agreed upon rates for the use of aircraft included each fixed-fee agreement. The lease revenue associated with the Company’s fixed-fee agreements is accounted for as an operating lease and is reflected as flying agreements revenue on the Company’s consolidated statements of comprehensive income. For the year ended December 31, 2018, fixed-fee arrangements represented approximately 84.3% of the Company’s flying agreements revenue. Under the Company’s revenue-sharing arrangements (referred to as a “revenue-sharing” or “prorate” arrangement), the major airline partner and the Company negotiate a passenger fare proration formula, pursuant to which the Company receives a percentage of the ticket revenues for those passengers traveling for one portion of their trip on a Company airline and the other portion of their trip on the major airline partner. Revenue is recognized under the Company’s prorate flying agreements when each flight is completed based upon the portion of the prorate passenger fare the Company anticipates that it will receive for each completed flight. The transaction price for the prorate agreements is determined from the proration formula derived from each passenger ticket amount on each completed flight over the agreement term. For the year ended December 31, 2018, prorate flying arrangements represented approximately 15.7% of the Company’s flying agreements revenue. In the event that the contractual rates under the agreements have not been finalized at quarterly or annual financial statement dates, the Company records revenues based on the lower of 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 airline partner, the Company evaluates the dispute under Topic 606 and, provided the revenue recognition criteria have been met, the Company recognizes revenue based on management’s estimate of the resolution of the dispute subject to the variable constraint guidance under Topic 606. 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. The following table represents the Company’s flying agreements revenue by type for the year ended December 31, 2018 and 2017 (in thousands): For the year ended December 31, 2018 2017 2016 Capacity purchase agreements revenue: flight operations $ 1,856,253 $ 1,805,510 $ 1,792,868 Capacity purchase agreements revenue: aircraft lease 814,518 834,366 763,406 Prorate agreements revenue 498,749 438,421 454,464 Flying agreements revenue $ 3,169,520 $ 3,078,297 $ 3,010,738 The Company’s fixed-fee and prorate agreements include weekly provisional cash payments from the respective major airline partner based on a projected level of flying each month. The Company and each major airline partner subsequently reconcile these payments to the actual completed flight activity on a monthly or quarterly basis. In the event a flying agreement includes a mid-term rate reset to adjust rates prospectively and the contractual rates under the Company’s flying agreements have not been finalized at quarterly or annual financial statement dates, the Company applies the variable constraint guidance under Topic 606, where the Company records revenue to the extent it believes that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. 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, subject to the variable constraint guidance under Topic 606. The following summarizes the significant provisions of each code-share agreement the Company has with each major airline partner through SkyWest Airlines: Delta Connection Agreements Agreement Aircraft type Number of Aircraft Term / Termination Delta Connection Agreement (fixed-fee arrangement) CRJ 200 CRJ 700 CRJ 900 E175 58 22 41 49 Individual aircraft have scheduled removal dates from 2019 to 2029 The average remaining term of the aircraft under contract is 4.1 years Delta Connection Prorate Agreement (revenue-sharing arrangement) CRJ 200 29 Terminable with 30-day notice United Express Agreements Agreement Aircraft type Number of Aircraft Term / Termination United Express Agreements (fixed-fee arrangement) CRJ 200 CRJ 700 E175 65 19 65 Individual aircraft have scheduled removal dates under the agreement between 2019 and 2029 The average remaining term of the aircraft under contract is 7.0 years United Express Prorate Agreement (revenue-sharing arrangement) CRJ 200 25 Terminable with 120-day notice American Agreements Agreement Aircraft type Number of Aircraft Term / Termination Dates American Agreement (fixed-fee arrangement) CRJ 700 58 Individual aircraft have scheduled removal dates from 2019 to 2023 American Prorate Agreement (revenue-sharing arrangement) CRJ 200 7 Terminable with 120-day notice Alaska Capacity Purchase Agreement Agreement Aircraft type Number of Aircraft Term / Termination Alaska Agreement (fixed-fee arrangement) E175 32 Individual aircraft have scheduled removal dates from 2027 to 2030 The following summarizes the code-share agreement activity the Company had with each major airline partner through ExpressJet Airlines: As of December 31, 2018, ExpressJet operated 100 ERJ145 aircraft and 16 CRJ200 aircraft under fixed-fee agreements with United, and 10 CRJ700 aircraft under a fixed-fee agreement with American. ExpressJet’s fixed-fee agreements with United and American were terminated in connection with our sale of ExpressJet in January 2019. ExpressJet also completed the wind down of its flying agreement with Delta by the end of 2018. The Company sold ExpressJet subsequent to December 31, 2018, however the Company retained ownership of the 16 CRJ200 aircraft and the 10 CRJ700 aircraft operated by ExpressJet as of December 31, 2018. The Company agreed to lease the 16 CRJ200 aircraft to ExpressJet for up to a five-year period. The Company is pursuing alternative uses of the 10 CRJ700 aircraft including, but not limited to, using the aircraft under fixed-fee agreements under a short-term basis or leasing the aircraft or aircraft engines to third parties. See Note 12, Subsequent Events , for additional information regarding the sale of ExpressJet. In addition to the contractual arrangements described above, SkyWest Airlines has entered into fixed-fee agreements with Alaska and Delta to place additional E175 aircraft into service for those major airline partners. As of December 31, 2018, the Company anticipated placing an additional three E175 aircraft with Alaska and nine E175 aircraft with Delta. The delivery dates for the new E175 aircraft are currently scheduled to take place by the end 2021. Final delivery dates may adjust based on various factors. SkyWest Airlines also entered into an agreement with Delta in the second quarter of 2018 to operate 20 CRJ900 aircraft under a fixed-fee agreement. As of December 31, 2018, SkyWest Airlines took delivery of five of these CRJ900 aircraft and placed the aircraft into service with Delta. The delivery dates for the remaining 15 aircraft are expected to continue through the end of 2020. These aircraft will replace 20 CRJ700 aircraft scheduled to expire under SkyWest’s flying contracts with Delta. When an aircraft is scheduled to be removed from a fixed-fee arrangement, the Company may, as practical under the circumstances, negotiate an extension with the respective major airline partner, negotiate the placement of the aircraft with another major airline partner, return the aircraft to the lessor if the aircraft is leased and the lease is expiring, place owned aircraft for sale, or pursue other uses for the aircraft. Other uses for the aircraft may include placing the aircraft in a prorate arrangement, leasing the aircraft to a third party or parting out the aircraft to use the engines and parts as spare inventory or to lease the engines to a third party. Airport customer service and other revenues primarily consist of ground handling functions, such as gate and ramp agent services at applicable airports where the Company provides such services. The transaction price for airport service agreements is determined from an agreed-upon rate by location applied to the applicable number of flights handled (measured by departures) by the Company over the agreement term. The Company’s operating 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 renegotiations, 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. Deferred Aircraft Credits The Company accounts for incentives provided by aircraft manufacturers as deferred credits. The deferred credits related to leased aircraft are amortized on a straight‑line basis as a reduction to rent expense over the lease term. Credits related to owned aircraft reduce the purchase price of the aircraft, which has the effect of amortizing the credits on a straight‑line basis as a reduction in depreciation expense over the life of the related aircraft. The incentives are credits that may be used to purchase spare parts and pay for training and other expenses. Income Taxes The Company recognizes a net liability or asset for the deferred tax consequences of all temporary differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements that are expected to result in taxable or deductible amounts in future years when the reported amounts of the assets and liabilities are recovered or settled. Net Income (Loss) Per Common Share Basic net income (loss) per common share (“Basic EPS”) excludes dilution and is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income (loss) 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 (loss) per common share. During the year ended December 31, 2018, 207,000 performance share units (at target performance) were excluded in the computation of Diluted EPS since the Company had not achieved the minimum target thresholds as of December 31, 2018. During the year ended December 31, 2017, 284,000 performance share units (at target performance) were excluded in the computation of Diluted EPS since the Company had not achieved the minimum target thresholds as of December 31, 2017. During the year ended December 31, 2016, 2,077,000 shares reserved for the issuance upon the exercise of outstanding options, performance shares and restricted stock units were excluded from the computation of Diluted EPS due to the net loss in 2016. The calculation of the weighted average number of common shares outstanding for Basic EPS and Diluted EPS are as follows for the years ended December 31, 2018, 2017 and 2016 (in thousands): Year Ended December 31, 2018 2017 2016 Numerator: Net Income (Loss) $ 280,372 $ 428,907 $ (161,586) Denominator: Basic earnings per share weighted average shares 51,914 51,804 51,505 Dilution due to stock options and restricted stock units 957 1,296 — Diluted earnings per share weighted average shares 52,871 53,100 51,505 Basic earnings (loss) per share $ 5.40 $ 8.28 $ (3.14) Diluted earnings (loss) per share $ 5.30 $ 8.08 $ (3.14) Comprehensive Income (Loss) Comprehensive income (loss) includes charges and credits to stockholders’ equity that are not the result of transactions with the Company’s shareholders, including changes in unrealized appreciation on marketable securities. Fair Value of Financial Instruments The carrying amounts reported in the consolidated balance sheets for receivables and accounts payable approximate fair values because of the immediate or short‑term maturity of these financial instruments. Marketable securities are reported at fair value based on market quoted prices in the consolidated balance sheets. If quoted prices in active markets are no longer available, the Company has estimated the fair values of these securities utilizing a discounted cash flow analysis as of December 31, 2018. These analyses consider, among other items, the collateralization underlying the security investments, the creditworthiness of the counterparty, the timing of expected future cash flows, and the expectation of the next time the security is expected to have a successful auction. 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 approximately $3,157.3 million as of December 31, 2018, as compared to the carrying amount of $3,185.4 million as of December 31, 2018. The Company’s fair value of long‑term debt as of December 31, 2017 was $2,698.4 million as compared to the carrying amount of $2,712.4 million as of December 31, 2017. Segment Reporting Generally accepted accounting principles require disclosures related to components of a company for which separate financial information is available to, and regularly evaluated by, the Company’s chief operating decision maker when deciding how to allocate resources and in assessing performance. The Company’s three operating segments consist of the operations conducted by SkyWest Airlines, ExpressJet and SkyWest Leasing. Information pertaining to the Company’s reportable segments is presented in Note 2, Segment Reporting . Recent Accounting Pronouncements Standards Effective in Future Years and Not Yet Adopted In February 2016, the FASB issued Accounting Standards Update 2016‑02, “Leases (Topic 842)” (“Topic 842”). Topic 842 amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. Topic 842 became effective beginning in the first quarter of 2019. In July 2018, the FASB issued ASU No. 2018-11, “Targeted Improvements - Leases (Topic 842).” This update provides an optional transition method that allows entities to elect to apply the standard prospectively at its effective date, versus recasting the prior periods presented. The Company anticipates electing this adoption method and expects to recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. Lease payments will include fixed and in-substance fixed payments, variable payments based on an index or rate, reasonably certain purchase options, termination penalties, and probable amounts the lessee will owe under a residual value guarantee. Lease payments will not include variable lease payments other than those that depend on an index or rate, any guarantee by the lessee of the lessor’s debt, or any amount allocated to non-lease components. Based on the Company’s initial assessment, the adoption of Topic 842 will significantly increase the Company’s assets and liabilities primarily to reflect its aircraft operating lease liability and related right-of-use asset. As of December 31, 2018, the Company had 260 leased aircraft under operating leases in its fleet. The Company also has operating leases related to terminal operations space and other real estate leases. The Company does not expect the adoption of the New Lease Standard to impact any of its existing debt covenants. Additionally, the Company does not expect the adoption to have a significant impact on the recognition, measurement or presentation of lease revenue and lease expenses within the condensed consolidated statements of operations and comprehensive income or the condensed consolidated statements of cash flows. The Company does not anticipate the adoption of Topic 842 will have a material impact on the timing or amount of the Company’s lease revenue as a lessor. The Company adopted Topic 842 on January 1, 2019. The Company expects to elect the several practical expedients available under the transition provisions of Topic 842, including (i) not reassessing whether expired or existing contracts contain leases, (ii) lease classification, and (iii) not revaluing initial direct costs for existing leases. Also, the Company plans to elect the practical expedient which will allow aggregation of non-lease components with the related lease components when evaluating accounting treatment. Lastly, the Company currently plans to |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting | |
Segment Reporting | (2) Segment Reporting Generally accepted accounting principles require disclosures related to components of a company for which separate financial information is available to, and regularly evaluated by, the Company’s chief operating decision maker when deciding how to allocate resources and in assessing performance. The Company’s three reporting segments consisted of the operations of SkyWest Airlines, ExpressJet and SkyWest Leasing activities. Corporate overhead expenses incurred by the Company were allocated to the operating expenses of SkyWest Airlines and ExpressJet. The Company sold ExpressJet in January 2019. The Company concluded the sale of ExpressJet did not meet the significant shift criteria for a discontinued operation under Discontinued Operations, Accounting Standards Codification 205-20, primarily as the Company continued to provide regional airline service through SkyWest Airlines in similar geographic regions, without a removal of a major airline partner, and with similar sized regional aircraft, upon the sale of ExpressJet. The Company’s chief operating decision maker analyzes the profitability of operating the E175 aircraft (including operating costs and associated revenue) separately from the profitability of the Company’s ownership, financing costs and associated revenue of the Company’s E175 aircraft (including depreciation expense, interest expense and associated revenue). The SkyWest Leasing segment includes revenue attributed to the Company’s E175 aircraft ownership cost earned under the applicable fixed-fee contracts and the depreciation and interest expense of the Company’s E175 aircraft. The SkyWest Leasing segment’s total assets and capital expenditures include the acquired E175 aircraft. The SkyWest Leasing segment additionally includes the activity of four CRJ200 aircraft leased to a third-party. The following represents the Company’s segment data for the years ended December 31, 2018, 2017 and 2016 (in thousands). Year Ended December 31, 2018 SkyWest Airlines ExpressJet SkyWest Leasing Consolidated Operating revenues $ 2,346,251 $ 564,202 $ 311,226 $ 3,221,679 Operating expense 2,022,560 577,608 147,231 2,747,399 Depreciation and amortization expense 155,511 37,290 141,788 334,589 Interest expense 17,021 2,340 101,048 120,409 Segment profit (loss) (1) 306,670 (15,746) 62,947 353,871 Total assets 2,531,707 279,303 3,502,202 6,313,212 Capital expenditures (including non-cash) 149,731 10,137 996,408 1,156,276 Year Ended December 31, 2017 SkyWest Airlines ExpressJet SkyWest Leasing Consolidated Operating revenues $ 2,092,368 $ 790,282 $ 239,942 $ 3,122,592 Operating expense 1,807,540 818,683 108,170 2,734,393 Depreciation and amortization expense 134,563 51,982 106,223 292,768 Interest expense 21,544 4,127 79,254 104,925 Segment profit (loss) (1) 263,284 (32,528) 52,518 283,274 Identifiable intangible assets, other than goodwill — 4,896 — 4,896 Total assets 2,245,051 599,122 2,630,227 5,474,400 Capital expenditures (including non-cash) 124,955 14,278 550,165 689,398 Year Ended December 31, 2016 SkyWest Airlines ExpressJet SkyWest Leasing Consolidated Operating revenues $ $ $ $ 3,063,702 Operating expense 68,148 3,236,386 Depreciation and amortization expense 139,159 83,935 61,875 284,969 Special items 184,295 281,354 — 465,649 Interest expense 26,211 6,773 45,193 78,177 Segment profit (loss) (1) 22,994 (301,514) 27,659 (250,861) Identifiable intangible assets, other than goodwill — 8,249 — 8,249 Total assets 5,007,966 Capital expenditures (including non-cash) 1,159,001 (1) Segment profit is operating income less interest expense |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2018 | |
Long-Term Debt | |
Long-Term Debt | (3) Long‑term Debt Long‑term debt consisted of the following as of December 31, 2018 and 2017 (in thousands): December 31, December 31, 2018 2017 Notes payable to banks, due in semi-annual installments, variable interest based on LIBOR, or with an interest rate of 4.00% through 2019, secured by aircraft $ 6,429 $ 34,905 Notes payable to a financing company, due in semi-annual installments, variable interest based on LIBOR, or with an interest rate of 3.25% through 2021, secured by aircraft 36,324 97,612 Notes payable to banks, due in semi-annual installments plus interest at 6.10% to 6.51% through 2021, secured by aircraft 41,592 63,090 Notes payable to banks, due in monthly installments plus interest of 2.68% to 6.86% through 2025, secured by aircraft 371,300 372,157 Notes payable to banks, due in monthly installments, plus interest at 4.07% to 6.05% through 2029, secured by aircraft 105,069 49,001 Notes payable to banks, due in quarterly installments, plus interest at 3.39% to 5.08% through 2030, secured by aircraft 2,621,416 2,085,822 Notes payable to banks due in monthly installments, interest at 3.30% through 2019, secured by spare engines 3,308 9,763 Long-term debt $ 3,185,438 $ 2,712,350 Current portion of long-term debt (354,072) (313,243) Less long-term portion of unamortized debt issue cost, net (21,598) (21,761) Long-term debt, net of current maturities and debt issue costs $ 2,809,768 $ 2,377,346 Current portion of long-term debt 354,072 313,243 Less current portion of unamortized debt issue cost, net (3,866) (3,565) Current portion of long-term debt, net of debt issue costs $ 350,206 $ 309,678 During the year ended December 31, 2018, the Company acquired 39 new E175 aircraft. Approximately 85% of the aircraft purchase price was financed through the issuance of debt and 15% of the aircraft purchase price was paid with cash. As of December 31, 2018 and 2017, the Company had $3.2 billion and $2.7 billion, respectively, of long‑term debt obligations primarily related to the acquisition of aircraft and certain spare engines. The average effective interest rate on the debt related to those long-term debt obligations at December 31, 2018 and 2017, was approximately 4.2% and 3.9%, respectively. During the year ended December 31, 2018, the Company used $43.5 million in cash to extinguish $43.5 million in debt early. The payment did not result in a pre-tax gain or loss in the consolidated statements of comprehensive income (loss). The Company did not extinguish any debt early during 2017. During the year ended December 31, 2016, the Company used $16.5 million in cash to extinguish $18.4 million in debt early. The payment resulted in a pre-tax gain of $1.3 million, reflected as other income in the consolidated statements of comprehensive income (loss). The aggregate amounts of principal maturities of long‑term debt as of December 31, 2018 were as follows (in thousands): 2019 $ 354,072 2020 2021 2022 2023 Thereafter $ 3,185,438 As of December 31, 2018 and 2017, SkyWest Airlines had a $75 million line of credit. The line of credit includes minimum liquidity and profitability covenants and is secured by certain assets. As of December 31, 2018 and 2017, SkyWest Airlines had no amount outstanding under the facility. However, at December 31, 2018 and 2017 the Company had $9.7 million and $14.8 million, respectively, in letters of credit issued under the facility which reduced the amount available under the facility to $65.3 million and $60.2 million, respectively. The facility expires on September 1, 2021 and has a variable interest rate of LIBOR plus 2.5% at December 31, 2018. As of December 31, 2018 and 2017, the Company had $78.7 million and $87.4 million, respectively, in letters of credit and surety bonds outstanding with various banks and surety institutions in addition to the letters of credit outstanding under the line of credit. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2018 | |
Income Taxes | |
Income Taxes | (4) Income Taxes The provision (benefit) for income taxes includes the following components (in thousands): Year ended December 31, 2018 2017 2016 Current tax provision (benefit): Federal $ (21,598) $ 5,853 $ (3,801) State 1,465 180 111 Foreign 1,575 — — (18,558) 6,033 (3,690) Deferred tax provision (benefit): Federal 92,250 (166,890) (77,430) State 12,250 20,133 (6,106) 104,500 (146,757) (83,536) Provision (benefit) for income taxes $ 85,942 $ (140,724) $ (87,226) The following is a reconciliation between a federal income tax rate of 21% for 2018 and 35% for 2017 and 2016 of income (loss) before income taxes and the effective tax rate which is derived by dividing the provision (benefit) for income taxes by the income (loss) before the provision for income (loss) taxes (in thousands): Year ended December 31, 2018 2017 2016 Computed provision (benefit) for income taxes at the statutory rate $ 76,926 $ 100,864 $ (87,084) Increase (decrease) in income taxes resulting from: State income tax provision (benefit), net of federal income tax benefit 12,711 7,778 (5,768) Non-deductible expenses 1,956 3,230 3,552 Valuation allowance changes affecting the provision for income taxes (1,187) 505 751 Foreign income taxes, net of federal & state benefit 1,192 — — Excess tax benefits from share-based compensation (4,548) (5,377) — Revaluation of net deferred taxes for the Tax Act — (246,845) — Other, net (1,108) (879) 1,323 Provision (benefit) for income taxes $ 85,942 $ (140,724) $ (87,226) For the year ended December 31, 2018, the Company released $1.2 million of valuation allowance against certain deferred tax assets primarily associated with ExpressJet state net operating losses and Company capital loss carry forwards. For the years ended December 31, 2017 and 2016, the Company recorded a $0.5 million and $0.8 million valuation allowance, respectively against certain deferred tax assets primarily associated with ExpressJet state net operating losses with a limited carry forward period. The decrease in the valuation allowance for 2018 was primarily based on changes in the Company's income tax projections and capital gains generated which reduced the amount of deferred tax assets that are anticipated to expire before the deferred tax assets may be utilized. The Company recorded a $4.5 million and $5.4 million benefit from share-based compensation in 2018 and 2017, respectively, relating to ASU 2016-09 which, beginning in 2017, requires excess tax benefits and deficiencies to be recognized in the income tax provision during the period stock options are exercised and when stock awards vest. The significant components of the Company’s net deferred tax assets and liabilities as of December 31, 2018 and 2017 are as follows (in thousands): As of December 31, 2018 2017 Deferred tax assets: Accrued benefits $ 32,462 $ 31,651 Net operating loss carryforward 344,375 122,648 AMT credit carryforward 15,744 23,443 Aircraft credits 35,924 53,870 Accrued reserves and other 18,710 26,647 Total deferred tax assets 447,215 258,259 Valuation allowance (9,455) (10,642) Deferred tax liabilities: Accelerated depreciation (955,919) (666,637) Total deferred tax liabilities (955,919) (666,637) Net deferred tax liability $ (518,159) $ (419,020) The Company’s deferred tax liabilities were primarily generated through accelerated depreciation, combined with shorter depreciable tax lives, allowed under the IRS tax code for purchased aircraft and support equipment compared to the Company’s depreciation policy under GAAP for such assets using the straight-line method (see note 1 Nature of Operations and Summary of Significant Accounting Policies). The Company's valuation allowance is related to certain deferred tax assets with a limited carry forward period where the Company does not anticipate utilizing these deferred tax assets prior to the lapse of the carry forward period. The Company's AMT credit carryforward includes credits from prior acquisitions. At December 31, 2018 and 2017, the Company had federal net operating losses of approximately $1,504.9 million and $491.4 million and state net operating losses of approximately $562.0 million and $302.5 million, respectively. The estimated effective tax rate applicable to the federal and state net operating losses at December 31, 2018 was 21.0% and 3.36%, respectively. The Company anticipated that the federal and state net operating losses will start to expire in 2030 and 2019, respectively. The Company has recorded a valuation allowance for state net operating losses the Company anticipates will expire before the benefit will be realized due to the limited carry forward periods. As of December 31, 2018 and 2017, the Company also had an alternative minimum tax credit of approximately $8.8 million and $23.4 million, respectively, which does not expire. Under the new Tax Cuts and Jobs Act of 2017 (“Tax Act”), the Company anticipates it will realize the alternative minimum tax credit either by offsetting regular tax due or as a refundable credit over the next three years. Under ASC Topic 740, the accounting guidance related to uncertainty in tax positions requires that the impact of a tax position be recognized in the financial statements if that position is more likely than not of being sustained on audit, based on the technical merits of the position. A reconciliation of the beginning and ending amount of unrecognized tax benefits for the year ended December 31, 2018 is as follows (in thousands) : Unrecognized tax benefits at the beginning of year $ 2,223 Gross increases - current year tax positions 13,899 Gross increases - prior year tax positions - Gross decreases - prior year tax positions (1,569) Unrecognized tax benefits at end of year $ 14,553 Interest and penalties in year-end balance - The Company has not accrued any interest or penalties related to uncertain tax positions as of December 31, 2018, as the Company's tax attributes would offset the estimated interest and penalties. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2018 | |
Commitments and Contingencies | |
Commitments and Contingencies | (5) Commitments and Contingencies Lease Obligations The Company leases 260 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 following table summarizes future minimum rental payments required under operating leases that have non‑cancelable lease terms as of December 31, 2018 (in thousands): 2019 $ 87,256 2020 101,741 2021 90,787 2022 72,593 2023 65,749 Thereafter 59,820 $ 477,946 The majority of the Company’s leased aircraft are owned and leased through trusts whose sole purpose is to purchase, finance and lease these aircraft to the Company (“Leveraged Lease Agreements”). The Company is not a beneficiary of such trusts and the Company does not have an ownership interest in such trusts. The Company’s leveraged leases do not require the Company to guarantee a portion of the residual values of the leased assets held by the trust and the Company’s leveraged lease agreements do not contain a fixed purchase option or have any other terms that represent variable interests in such trusts. As a result, the Company has not consolidated any of these trusts. Total rental expense for non-cancelable aircraft operating leases was approximately $154.9 million, $215.8 million and $262.6 million for the years ended December 31, 2018, 2017 and 2016, respectively. The minimum rental expense for airport station rents was approximately $19.6 million, $30.3 million and $31.4 million for the years ended December 31, 2018, 2017 and 2016, respectively. Self‑insurance The Company self‑insures a portion of its potential losses from claims related to workers’ compensation, environmental issues, property damage, medical insurance for employees and general liability. Losses are accrued based on an estimate of the ultimate aggregate liability for claims incurred, using standard industry practices and the Company’s actual experience. Actual results could differ from these estimates. Legal Matters The Company is subject to certain legal actions which it considers routine to its business activities. As of December 31, 2018, 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. Concentration Risk and Significant Customers The Company requires no collateral from its major airline partners or customers, but monitors the financial condition of its major airline partners. Under the majority of the Company’s code-share agreements, the Company receives weekly payments from its major code-share partners that approximate a significant percentage of the compensation earned for such period. Additionally, the Company provides certain customer service functions at multiple airports for various airlines and the Company maintains an allowance for doubtful accounts receivable based upon expected collectability of all accounts receivable. The Company’s allowance for doubtful accounts totaled $158,000 and $157,000 as of December 31, 2018 and 2017, respectively. For the years ended December 31, 2018, 2017 and 2016, the Company’s contractual relationships with Delta and United combined accounted for approximately 81.4%, 82.9% and 88.7%, respectively of the Company’s total revenues. Employees Under Collective Bargaining Agreements As of December 31, 2018, the Company had approximately 15,900 full‑time equivalent employees. As of December 31, 2018, ExpressJet had 2,932 full-time equivalent employees of which approximately 2,320 employees where represented by a union. Although no SkyWest Airlines employees are represented by a union, certain SkyWest Airline employees are covered under a stable and binding collective bargaining agreement that is administered by employee representatives. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Measurements | |
Fair Value Measurements | (6) 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 December 31, 2018, 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 December 31, 2018 Total Level 1 Level 2 Level 3 Marketable Securities Bonds and bond funds $ 229,783 $ — $ $ — Commercial paper 131,162 — — $ 360,945 $ — $ $ — Cash, Cash Equivalents and Restricted Cash 328,384 — — Total Assets Measured at Fair Value $ 689,329 $ $ $ — Fair Value Measurements as of December 31, 2017 Total Level 1 Level 2 Level 3 Marketable Securities Bonds and bond funds $ 344,251 $ — $ $ — Commercial paper — — $ $ — $ $ — Cash, Cash Equivalents and Restricted Cash — — Total Assets Measured at Fair Value $ 685,295 $ $ 503,503 $ — The Company’s “Marketable Securities” classified as Level 2 primarily utilize broker quotes in a non‑active market for valuation of these securities. No significant transfers between Level 1, Level 2 and Level 3 occurred during the year ended December 31, 2018. The Company’s policy regarding the recording of transfers between levels is to record any such transfers at the end of the reporting period. |
Special Items
Special Items | 12 Months Ended |
Dec. 31, 2018 | |
Special Items | |
Special Items | (7) Special Items The following table summarizes the components of the Company's special items, for the year ended December 31, 2018, 2017 and 2016 (in thousands): Year ended December 31, 2018 2017 2016 Special items: CRJ200 aircraft related items 1 $ — $ — $ 424,466 ERJ145 aircraft related items 2 — — 41,183 Total special items $ — $ — $ 465,649 (1) Consists primarily of inventory valuation charges and impairment charges to write-down CRJ200 aircraft including related long-lived assets to their estimated fair value. The estimated fair value of the long-lived assets, including the aircraft and fixed asset spare parts inventory, was based on third-party appraisals on the assets. These values were estimated based on listed market values or recent third-party market transactions for similar assets. Additionally, the Company estimated the fair value of certain long-lived prepaid lease assets using the net present value of estimated current CRJ200 lease rates. All fair values are considered to be Level 3 within the fair value hierarchy. Of the special items $184.3 million related to SkyWest Airlines and $240.2 million related to ExpressJet. These charges are net of $90 million in cash proceeds and other considerations from the Bombardier termination agreement. These special items are reflected in the SkyWest Airlines and ExpressJet operating expenses under Note 2 Segment Reporting. (2) The ERJ145 aircraft related items recorded in the 2016 special charge consist primarily of inventory valuation charges and impairment charges to write-down certain ERJ145 long-lived assets, which primarily consisted of spare engines and ERJ145 spare aircraft parts, to their estimated fair value of $41.2 million. The estimated fair value of the long-lived assets was based on third-party appraisals and valuations for similar assets which is considered an unobservable input (Level 3) under the fair value hierarchy. These special items are reflected in the ExpressJet operating expenses under Note 2 Segment Reporting . |
Capital Transactions
Capital Transactions | 12 Months Ended |
Dec. 31, 2018 | |
Capital Transactions | |
Capital Transactions | (8) Capital Transactions Preferred Stock The Company is authorized to issue 5,000,000 shares of preferred stock in one or more series without shareholder approval. No shares of preferred stock are presently outstanding. The Company’s Board of Directors is authorized, without any further action by the shareholders of the Company, to (i) divide the preferred stock into series; (ii) designate each such series; (iii) fix and determine dividend rights; (iv) determine the price, terms and conditions on which shares of preferred stock may be redeemed; (v) determine the amount payable to holders of preferred stock in the event of voluntary or involuntary liquidation; (vi) determine any sinking fund provisions; and (vii) establish any conversion privileges. Stock Compensation On May 4, 2010, the Company’s shareholders approved the adoption of the SkyWest, Inc. 2010 Long‑Term Incentive Plan, which provides for the issuance of up to 5,150,000 shares of common stock to the Company’s directors, employees, consultants and advisors (the “2010 Incentive Plan”). The 2010 Incentive Plan provides for awards in the form of options to acquire shares of common stock, stock appreciation rights, restricted stock grants, restricted stock units and performance awards. The 2010 Incentive Plan is administered by the Compensation Committee of the Company’s Board of Directors (the “Compensation Committee”), which is authorized to designate option grants as either incentive stock options for income tax purposes (“ISO”) or non-statutory stock options ISOs are granted at not less than 100% of the market value of the underlying common stock on the date of grant. Non‑statutory stock options are granted at a price as determined by the Compensation Committee. As of December 31, 2018 the 2010 Incentive Plan had 2.0 million shares remaining available for future issuance. Stock Options The fair value of stock options awarded under the Company’s stock option plans 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 years ended December 31, 2018 and 2017, the Company did not grant any options to purchase shares of common stock. The Company granted 206,021 stock options to employees under the 2010 Incentive Plan during the years ended December 31, 2016. Stock options granted in 2016 vest in three equal installments over a three-year period. The following table shows the assumptions used and weighted average fair value for grants in the years ended December 31, 2016. 2016 Expected annual dividend rate 1.08 % Risk-free interest rate 1.15 % Average expected life (years) 5.7 Expected volatility of common stock 0.412 Forfeiture rate % Weighted average fair value of option grants $ 5.27 The Company recorded share‑based compensation expense only for those options that are expected to vest. The estimated fair value of the stock options is amortized over the vesting period of the respective stock option grants. Options are exercisable for a period as defined by the Compensation Committee on the date granted; however, no stock option will be exercisable before six months have elapsed from the date of grant and no stock option shall be exercisable after seven years from the date of grant. The following table summarizes the stock option activity for all of the Company’s plans for the years ended December 31, 2018, 2017 and 2016. 2018 2017 2016 Weighted Weighted Average Aggregate Weighted Weighted Average Remaining Intrinsic Average Average Number of Exercise Contractual Value Number of Exercise Number of Exercise Options Price Term ($000) Options Price Options Price Outstanding at beginning of year 458,103 $ 13.73 4.0 years $ 18,034.1 819,981 $ 13.58 1,064,429 $ 13.64 Granted — — — — 206,021 14.90 Exercised (157,523) 13.80 (356,209) 13.36 (351,296) 14.17 Cancelled — — (5,669) 14.33 (99,173) 14.90 Outstanding at end of year 300,580 13.70 3.0 years $ 9,249.4 458,103 13.73 819,981 13.58 Exercisable at December 31, 2018 235,672 13.36 2.7 years $ 7,330.7 Exercisable at December 31, 2017 254,192 13.17 3.4 years $ 10,150.8 The total intrinsic value of options to acquire shares of the Company’s common stock that were exercised during the years ended December 31, 2018, 2017 and 2016 was $7,100,000, $9,940,000 and $4,250,000, respectively. The following table summarizes the status of the Company’s non‑vested stock options as of December 31, 2018: Weighted-Average Number of Grant-Date Shares Fair Value Non-vested shares at beginning of year $ 5.17 Granted — — Vested (139,003) 5.10 Cancelled — — Non-vested shares at end of year $ 5.32 The following table summarizes information about the Company’s stock options outstanding at December 31, 2018: Options Outstanding Options Exercisable Weighted Average Number Remaining Weighted Average Number Weighted Average Range of Exercise Prices Outstanding Contractual Life Exercise Price Exercisable Exercise Price $12.00 to $13.99 2.4 years $ 13.04 $ $14.00 to $15.99 4.1 years $16.00 to $19.00 3.8 years $12.00 to $19.00 3.0 years $ $ Restricted Stock Units (“RSUs”) During the year ended December 31, 2018, the Company granted 115,044 restricted stock units to certain of the Company’s employees under the 2010 Incentive Plan. The restricted stock units granted during the year ended December 31, 2018 have a three‑year cliff-vesting period, during which the recipient must remain employed with the Company or its subsidiaries. The weighted average fair value of the restricted stock units at the date of grants made during the year ended December 31, 2018 was $53.40 per share. The following table summarizes the activity of restricted stock units granted to certain Company employees for the years ended December 31, 2018, 2017 and 2016: : Weighted-Average Grant-Date Fair Number of RSUs Value Non-vested RSUs outstanding at December 31, 2015 809,299 $ 13.13 Granted 384,148 14.81 Vested (215,146) 13.29 Cancelled (51,370) 13.72 Non-vested RSUs outstanding at December 31, 2016 926,931 $ 13.65 Granted 160,137 35.81 Vested (230,903) 12.01 Cancelled (40,575) 15.78 Non-vested RSUs outstanding at December 31, 2017 815,590 $ 18.35 Granted 115,044 53.40 Vested (330,580) 13.57 Cancelled (24,273) 27.77 Non-vested RSUs outstanding at December 31, 2018 575,781 $ 27.71 Performance Stock Units (“PSUs”) During the year ended December 31, 2018, the Compensation Committee granted performance share units, which are performance based restricted stock units, to certain Company employees with three-year performance-based financial metrics that the Company must meet before those awards may be earned and the performance period is measured for the three years ending December 31, 2020. The Company’s compensation expense for performance share units is based upon the projected number of performance share units estimated to be awarded at the conclusion of the performance period. During 2018, the Compensation Committee awarded 92,335 additional shares of stock related to the performance share grant in 2015 based on the Company’s performance for the three years ended December 31, 2017 measured against the pre-established targets for the same period. The Compensation Committee will determine the achievement of performance results and corresponding vesting of performance shares for each year’s grant in 2016, 2017 and 2018. At the end of each performance period, the number of shares awarded can range from 0% to 200% of the original granted amount for performance share units granted in 2018 and 2017. Performance shares granted in 2016 can range from 0% to 150% of the original granted amount, depending on the performance against the pre-established targets. The following table summarizes the activity of performance share units granted at target as of December 31, 2018. Weighted-Average Grant-Date Number of PSUs Fair Value Non-vested PSUs outstanding at December 31, 2015 202,829 $ 13.62 Granted 14.89 Vested — — Cancelled (22,413) 14.16 Non-vested PSUs outstanding at December 31, 2016 363,993 $ 14.23 Granted 35.81 Vested — — Cancelled (14,732) 15.00 Non-vested PSUs outstanding at December 31, 2017 $ 19.70 Granted 53.41 Additional PSUs awarded from the 2015 grant 13.62 Vested Cancelled (3,229) 30.09 Non-vested PSUs outstanding at December 31, 2018 $ 30.84 During the years ended December 31, 2018, 2017 and 2016 the Company granted fully‑vested shares of common stock to the Company’s directors in the amounts of 15,165, 22,617 and 42,624 shares, respectively, with a weighted average grant‑date fair value of $53.40, $35.81, and $14.78 respectively. During the year ended December 31, 2018, 2017 and 2016, the Company recorded equity‑based compensation expense of $13.1 million, $10.6 million and $7.6 million, respectively. As of December 31, 2018, the Company had $12.7 million of total unrecognized compensation cost related to non‑vested stock options, non‑vested restricted stock grants and non-vested performance stock units. Total unrecognized compensation cost will be adjusted for future changes in estimated forfeitures. The Company expects to recognize this cost over a weighted average period of 1.7 years. Taxes The Company’s treatment of stock option grants of non‑qualified options, restricted stock units and performance shares results in the creation of a deferred tax asset, which is a temporary difference, until the time that the option is exercised or the restrictions lapse. |
Retirement Plans and Employee S
Retirement Plans and Employee Stock Purchase Plans | 12 Months Ended |
Dec. 31, 2018 | |
Retirement Plans and Employee Stock Purchase Plans | |
Retirement Plans and Employee Stock Purchase Plans | (9) Retirement Plans and Employee Stock Purchase Plans SkyWest Retirement Plan The Company sponsors the SkyWest, Inc. Employees’ Retirement Plan (the “SkyWest Plan”). Employees who have completed 90 days of service and are at least 18 years of age are eligible for participation in the SkyWest Plan. Employees may elect to make contributions to the SkyWest Plan. Generally, the Company matches 100% of such contributions up to levels ranging from 2% to 12% of compensation, based on position and years of service. Additionally, a discretionary contribution may be made by the Company. The Company’s combined contributions to the SkyWest Plan were $35.6 million, $26.1 million and $23.2 million for the years ended December 31, 2018, 2017 and 2016, respectively. ExpressJet and Atlantic Southeast Retirement Plans ExpressJet (formerly Atlantic Southeast) sponsors the Atlantic Southeast Airlines, Inc. Investment Savings Plan (the “Atlantic Southeast Plan”). Employees who have completed 90 days of service and are 18 years of age are eligible for participation in the Atlantic Southeast Plan. Employees may elect to make contributions to the Atlantic Southeast Plan, ExpressJet will match up to 6% of each participant’s total compensation, based on years of service and other provisions included in the Atlantic Southeast Plan. Additionally, participants are 100% vested in their elective deferrals and rollover amounts in company matching contributions. ExpressJet additionally sponsors the ExpressJet Airlines, Inc. 401(k) Savings Plan (the “ExpressJet Retirement Plan”). Substantially all of ExpressJet’s domestic employees were covered by this plan at the time the Company acquired ExpressJet in 2010. Effective January 1, 2009, the ExpressJet Retirement Plan was amended such that certain matching payment amounts have been reduced or eliminated depending on the terms of the collective bargaining unit or work group, as applicable. ExpressJet’s contribution to the Atlantic Southeast and the ExpressJet Retirement Plans was $15.4 million, $17.8 million and $21.0 million for the years ended December 31, 2018, 2017 and 2016, respectively. Employee Stock Purchase Plans In May 2009, the Company’s Board of Directors approved the SkyWest, Inc. 2009 Employee Stock Purchase Plan (the “2009 Stock Purchase Plan”). All employees who have completed 90 days of employment with the Company or one of its subsidiaries are eligible to participate in the 2009 Stock Purchase Plan, except employees who own five percent or more of the Company’s common stock. The 2009 Stock Purchase Plan enables employees to purchase shares of the Company’s common stock at a five percent discount, through payroll deductions. Employees can contribute up to 15% of their base pay, not to exceed $25,000 each calendar year, for the purchase of shares. Shares are purchased semi-annually at a five percent discount based on the end of the period price. Employees can terminate their participation in the 2009 Stock Purchase Plan at any time upon written notice. The following table summarizes purchases made under the 2009 Employee Stock Purchase Plans during the years ended December 31, 2018, 2017 and 2016: Year ended December 31, 2018 2017 2016 Number of shares purchased 60,950 88,362 151,531 Average price of shares purchased $ 49.85 $ 33.96 $ 20.87 The 2009 Stock Purchase Plan is a non‑compensatory plan under the accounting guidance. Therefore, no compensation expense was recorded for the years ended December 31, 2018, 2017 and 2016. |
Stock Repurchase
Stock Repurchase | 12 Months Ended |
Dec. 31, 2018 | |
Stock Repurchase | |
Stock Repurchase | (10) Stock Repurchase The Company’s Board of Directors has adopted a stock repurchase program which authorizes the Company to repurchase shares of the Company’s common stock in the public market or in private transactions, from time to time, at prevailing prices. The Company’s stock repurchase program authorizes the repurchase of up to $100.0 million of the Company’s common stock, over a three year period commencing on February 9, 2017, of which $25.5 million remained available at December 31, 2018. During the years ended December 31, 2018 and 2017, the Company repurchased 1.0 million and 0.5 million shares of common stock for approximately $54.4 million and $20.0 million, respectively at a weighted average price per share of $56.25 and $41.36, respectively. The Company did not repurchase any shares of its common stock during the year ended December 31, 2016. Additionally, during the year ended December 31, 2018 and 2017, the Company paid $13.6 million and $5.1 million, respectively, for a net settlement of the income tax obligation on employee equity awards that vested during the applicable periods. |
Related-Party Transactions
Related-Party Transactions | 12 Months Ended |
Dec. 31, 2018 | |
Related-Party Transactions | |
Related-Party Transactions | (11) Related‑Party Transactions During the year ended December 31, 2018, the Company purchased $206,000 of spare aircraft parts from an entity affiliated with a director of the Company. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2018 | |
Subsequent Events | |
Subsequent Events | (12) Subsequent Events ExpressJet Sale On January 22, 2019, the Company completed the previously announced sale of its wholly owned subsidiary ExpressJet. The Company anticipates the sale of ExpressJet will result in a gain in 2019. The closing of the transaction was completed in two parts, through an asset sale and stock sale, as further described below. Asset Sale On January 11, 2019, pursuant to the terms and conditions of the Asset Purchase Agreement, dated as of December 17, 2018 (the “Asset Purchase Agreement”), by and among the Company, ExpressJet and United, United acquired certain specified assets and liabilities of ExpressJet, including, among other things, aircraft engines, auxiliary power units, rotable spare parts, ground support equipment and flight training equipment for $60.0 million in cash, subject to certain purchase price adjustments (the “Asset Sale”). Certain assets and liabilities of ExpressJet were expressly excluded from the Asset Sale. Stock Sale Additionally, on January 22, 2019, pursuant to the terms and conditions of the Stock Purchase Agreement, dated as of December 17, 2018, by and among the Company and ManaAir, LLC, a company in which United owns a minority interest (the “Buyer”), the Buyer acquired all of the outstanding shares of capital stock of ExpressJet from the Company for $16.0 million in cash, subject to certain purchase price adjustments (the “Stock Sale,” and collectively with the Asset Sale, the “ExpressJet Sale”). To facilitate payment of the purchase price for the Stock Sale, at the closing of the Stock Sale, the Company loaned $26 million to Kair Enterprises, Inc., the majority owner of the Buyer. The Company agreed to lease 16 CRJ200 aircraft to ExpressJet for up to a five year term as part of the transaction. Early Lease Buyout Subsequent to December 31, 2018, the Company entered into an agreement with a lessor for an early lease buyout of 16 CRJ700s and 36 CRJ200s. The Company anticipates using $111.7 million in cash to acquire the aircraft off lease and not assuming any debt associated with these aircraft in conjunction with the lease buyout. The Company anticipates completing the transaction during the three months ending March 31, 2019. Share Repurchase Plan In February 2019, the Company’s Board of Directors approved a new share repurchase plan, pursuant to which the Company is authorized to repurchase up to $250 million of the Company’s common stock. This authorization superseded the previous share repurchase plan approved in February 2017. |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Data (Unaudited) | |
Quarterly Financial Data (Unaudited) | (13) Quarterly Financial Data (Unaudited) Unaudited summarized financial data by quarter for 2018 and 2017 is as follows (in thousands, except per share data): Year ended December 31, 2018 First Second Third Fourth Quarter Quarter Quarter Quarter Year Operating revenues $ 783,400 $ 805,515 $ 829,275 $ 803,489 $ Operating income 88,175 126,678 137,925 121,502 474,280 Net income 54,362 75,859 83,046 67,105 280,372 Net income per common share: Basic 1.30 5.40 Diluted 1.28 5.30 Weighted average common shares: Basic: 51,921 52,046 52,039 51,650 51,914 Diluted: 53,033 52,913 52,981 52,556 52,871 Year ended December 31, 2017 First Second Third Fourth Quarter Quarter Quarter Quarter Year Operating revenues $ 747,166 $ 791,512 $ 812,673 $ $ Operating income 76,295 106,596 112,369 92,939 388,199 Net income (1) 34,786 50,477 53,716 289,928 428,907 Net income per common share: Basic 5.60 8.28 Diluted 5.46 8.08 Weighted average common shares: Basic: 51,820 51,751 51,833 Diluted: 53,202 52,977 53,080 (1) Net income for 2017 included a $246.8 million benefit related to the revaluation of the Company’s deferred tax liability and other tax liabilities in accordance with the Tax Act. |
SCHEDULE II_VALUATION AND QUALI
SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2018 | |
SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS | |
SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS | SKYWEST, INC. AND SUBSIDIARIES SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS For the Years Ended December 31, 2018, 2017 and 2016 (Dollars in thousands) Additions Balance at Charged to Beginning Costs and Balance at Description of Year Expenses Deductions End of Year Year ended December 31, 2018: Allowance for inventory obsolescence $ 17,098 5,043 — $ 22,141 Allowance for doubtful accounts receivable 157 1 — 158 $ 17,255 5,044 — $ 22,299 Year ended December 31, 2017: Allowance for inventory obsolescence(1) $ 40,497 — (23,399) $ 17,098 Allowance for doubtful accounts receivable 173 — (16) 157 $ 40,670 — (23,415) $ 17,255 Year ended December 31, 2016: Allowance for inventory obsolescence(2) $ 13,933 26,564 — $ 40,497 Allowance for doubtful accounts receivable 187 — (14) 173 $ 14,120 26,564 (14) $ 40,670 (1) The deductions in 2017 related to the disposal of excess and obsolete inventory in 2017. (2) The increase in the inventory obsolescence related to additional excess inventory identified as part of the impairment analysis of the 50-seat aircraft. See note 7, Special items , for additional detail on the impairment. |
Nature of Operations and Summ_2
Nature of Operations and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
Nature of Operations and Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The Company’s consolidated financial statements include the accounts of the Company and the SkyWest Airlines, ExpressJet and SkyWest Leasing segments, with all inter‑company transactions and balances having been eliminated. In preparing the accompanying consolidated financial statements, the Company has reviewed, as determined necessary by the Company’s management, events that have occurred after December 31, 2018, through the filing date of the Company’s annual report with the U.S. Securities and Exchange Commission. The Company reclassified certain prior period amounts to conform to the current period presentation (see Recent Accounting Pronouncements). |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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 could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. The Company had no restricted cash as of December 31, 2018 and 2017. |
Marketable securities | Marketable Securities The Company’s investments are classified as available-for-sale and are reported at fair market value with the net unrealized appreciation reported as a component of accumulated other comprehensive income (loss) in stockholders’ equity. At the time of sale, any realized appreciation or depreciation, calculated by the specific identification method, is recognized in other income and expense. The Company’s position in marketable securities as of December 31, 2018 and 2017 was as follows (in thousands): Gross unrealized Gross unrealized At December 31, 2018 Amortized Cost holding gains holding losses Fair market value Total cash and cash equivalents $ 328,384 $ — $ — $ 328,384 Marketable securities: Bond and bond funds $ 229,825 $ — $ (42) $ 229,783 Commercial Paper 131,163 — (1) 131,162 Total marketable securities $ 360,988 $ — $ (43) $ 360,945 Total assets measured at fair value $ 689,372 $ — $ (43) $ 689,329 Gross unrealized Gross unrealized At December 31, 2017 Amortized Cost holding gains holding losses Fair market value Total cash and cash equivalents $ 181,792 $ — $ — $ 181,792 Marketable securities: Bond and bond funds $ 344,479 $ — $ (228) $ 344,251 Commercial Paper 159,252 — — 159,252 Total marketable securities $ 503,731 $ — $ (228) $ 503,503 Total assets measured at fair value $ 685,523 $ — $ (228) $ 685,295 As of December 31, 2018 and 2017, the Company had classified $360.9 million and $503.5 million of marketable securities, respectively, as short‑term since it had the ability to redeem the securities within one year. |
Inventories | Inventories Inventories include expendable parts, fuel and supplies and are valued at cost (FIFO basis) less an allowance for obsolescence based on historical results, excess parts and management’s expectations of future operations. Expendable inventory parts are charged to expense as used. An obsolescence allowance for flight equipment expendable parts is accrued based on estimated lives of the corresponding fleet types and salvage values. The inventory allowance as of December 31, 2018 and 2017 was $22.1 million and $17.1 million, respectively. These allowances are based on management estimates. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost and depreciated over their useful lives to their estimated residual values using the straight‑line method as follows: Assets Depreciable Life Current Residual Value Aircraft, rotable spares, and spare engines up to 22 years up to 20 % Ground equipment up to 10 years 0 % Office equipment up to 7 years % Leasehold improvements Shorter of 15 years or lease term % Buildings 20 - 39.5 years % |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets As of December 31, 2018, the Company had approximately $5.0 billion of property and equipment and related assets. In accounting for these long‑lived and intangible assets, the Company makes estimates about the expected useful lives of the assets, the expected residual values of certain of these assets, and the potential for impairment based on the fair value of the assets and the cash flows they generate. Factors indicating potential impairment include, but are not limited to, significant decreases in the market value of the long‑lived assets, a significant change in the condition of the long‑lived assets and operating cash flow losses associated with the use of the long‑lived assets. On a periodic basis, the Company evaluates whether impairment indicators are present. When considering whether or not impairment of long‑lived assets exists, the Company groups similar assets together at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities and compare the undiscounted cash flows for each asset group to the net carrying amount of the assets supporting the asset group. Asset groupings are done at the fleet or contract level. The Company did not recognize any impairment charges of long-lived assets during the years ended December 31, 2018 and 2017. During the year ended December 31, 2016, the Company impaired certain long-lived assets relating to the CRJ200 aircraft and ERJ145 aircraft type specific assets. See Note 7, Special Items . |
Capitalized Interest | Capitalized Interest Interest is capitalized on aircraft purchase deposits as a portion of the cost of the asset and is depreciated over the estimated useful life of the asset. During the years ended December 31, 2018, 2017 and 2016, the Company capitalized interest costs of approximately $1.5 million, $1.4 million, and $1.5 million, respectively. |
Maintenance | Maintenance The Company operates under a U.S. Federal Aviation Administration approved continuous inspection and maintenance program. The Company uses the direct expense method of accounting for its regional jet engine overhauls wherein the expense is recorded when the overhaul event occurs. The Company has engine services agreements with third-party vendors to provide long-term engine services covering the scheduled and unscheduled repairs for most of its CRJ200 aircraft, CRJ700 aircraft, ERJ145 aircraft and E175 aircraft. Under the terms of the agreements, the Company pays a fixed dollar amount per engine hour flown on a monthly basis and the third-party vendors will assume the responsibility to repair the engines at no additional cost to the Company, subject to certain specified exclusions. Maintenance costs under these contracts are recognized when the engine hour is flown pursuant to the terms of each contract. The costs of maintenance for airframe and avionics components, landing gear and other recurring maintenance are expensed as incurred. |
Flying Agreements and Airport Customer Service and Other Revenues | Flying Agreements and Airport Customer Service and Other Revenues In May 2014, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update No. 2014‑09, “Revenue from Contracts with Customers, (Topic 606)” (“Topic 606”). Under Topic 606, 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. The Company adopted this standard as of January 1, 2018, utilizing the full retrospective method of adoption allowed by the standard, in order to provide for comparative results in all periods presented. Under the new standard, the Company concluded that the individual flights are distinct services and the flight services promised in a capacity purchase agreement represent a series of services that should be accounted for as a single performance obligation, recognized over time as the flights are completed. Performance obligations are deemed met upon the completion of each individual flight. The major airline partners make provisional cash payments to the Company during each month of service based on monthly flight schedules and the provisional cash payments are reconciled based on actual completed flights after each month’s flight activity is completed. The compensation associated with the use of the aircraft under the Company’s fixed-fee agreements is considered lease revenue as the agreements identify the “right of use” of a specific type and number of aircraft over the agreement term and was not impacted by the adoption of ASC 606. The adoption of Topic 606 did not have a material impact on recorded amounts when applied to the opening balance sheet as of January 1, 2018. The adoption of Topic 606 only affected the Company’s consolidated balance sheets and statements of comprehensive income classification, with no impact on the Company’s operating income (loss), net income (loss), earnings (loss) per share or cash flows, however the principal versus agent considerations under Topic 606 resulted in the Company recording directly reimbursed fuel expense under its fixed-fee contracts as a reduction to the applicable operating expense (net) rather than revenue (gross). This classification change resulted in a reduction to total revenue and a reduction to operating expenses by the same amount, resulting in no change to operating income. Additionally, under the nonrefundable up-front fees and contract costs considerations of Topic 606, reimbursements from the Company’s major airline partners for up-front contract costs will be deferred and amortized over the contract term. The related up-front costs to obtain the contract will also be capitalized and amortized over the contract term. As the amount of the up-front reimbursement is determined from the Company’s actual costs to fulfill the contract, this change did not impact the Company’s operating income (loss) as the amount of deferred revenue and the amount of capitalized costs will be recognized over the same period. This change also resulted in a deferred revenue liability and a capitalized contract cost on the balance sheet of the same amount. The Company recognizes flying agreements and airport customer service and other revenues when the service is provided under its code-share agreements. Under the Company’s fixed-fee arrangements (referred to as “fixed-fee arrangements, “fixed-fee contracts” or “capacity purchase agreements”) with Delta, United, American and Alaska ( each, a “major airline partner”), the major airline partner generally pays the Company a fixed-fee for each departure, flight hour (measured from takeoff to landing, excluding taxi time) or block hour (measured from takeoff to landing, including taxi 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 airport landing fees and airport rents. Under the fixed-fee arrangements, revenue is earned when each flight is completed and is reflected in flying agreements revenue. The transaction price for the fixed-fee agreements is determined from the fixed-fee consideration, incentive consideration and directly reimbursed expenses earned as flights are completed over the agreement term. A portion of the Company’s compensation under its fixed-fee agreements is designed to reimburse the Company for certain aircraft ownership costs. The consideration for aircraft ownership costs varies by agreement, but is intended to cover either the Company’s aircraft principal and interest debt service costs, its aircraft depreciation and interest expense or its aircraft lease expense costs while the aircraft is under contract. The consideration received for the use of the aircraft under the Company’s fixed-fee agreements is reflected as lease revenue, inasmuch as the agreements identify the “right of use” of a specific type and number of aircraft over a stated period of time. The amount of compensation deemed to be lease revenue is determined from the agreed upon rates for the use of aircraft included each fixed-fee agreement. The lease revenue associated with the Company’s fixed-fee agreements is accounted for as an operating lease and is reflected as flying agreements revenue on the Company’s consolidated statements of comprehensive income. For the year ended December 31, 2018, fixed-fee arrangements represented approximately 84.3% of the Company’s flying agreements revenue. Under the Company’s revenue-sharing arrangements (referred to as a “revenue-sharing” or “prorate” arrangement), the major airline partner and the Company negotiate a passenger fare proration formula, pursuant to which the Company receives a percentage of the ticket revenues for those passengers traveling for one portion of their trip on a Company airline and the other portion of their trip on the major airline partner. Revenue is recognized under the Company’s prorate flying agreements when each flight is completed based upon the portion of the prorate passenger fare the Company anticipates that it will receive for each completed flight. The transaction price for the prorate agreements is determined from the proration formula derived from each passenger ticket amount on each completed flight over the agreement term. For the year ended December 31, 2018, prorate flying arrangements represented approximately 15.7% of the Company’s flying agreements revenue. In the event that the contractual rates under the agreements have not been finalized at quarterly or annual financial statement dates, the Company records revenues based on the lower of 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 airline partner, the Company evaluates the dispute under Topic 606 and, provided the revenue recognition criteria have been met, the Company recognizes revenue based on management’s estimate of the resolution of the dispute subject to the variable constraint guidance under Topic 606. 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. The following table represents the Company’s flying agreements revenue by type for the year ended December 31, 2018 and 2017 (in thousands): For the year ended December 31, 2018 2017 2016 Capacity purchase agreements revenue: flight operations $ 1,856,253 $ 1,805,510 $ 1,792,868 Capacity purchase agreements revenue: aircraft lease 814,518 834,366 763,406 Prorate agreements revenue 498,749 438,421 454,464 Flying agreements revenue $ 3,169,520 $ 3,078,297 $ 3,010,738 The Company’s fixed-fee and prorate agreements include weekly provisional cash payments from the respective major airline partner based on a projected level of flying each month. The Company and each major airline partner subsequently reconcile these payments to the actual completed flight activity on a monthly or quarterly basis. In the event a flying agreement includes a mid-term rate reset to adjust rates prospectively and the contractual rates under the Company’s flying agreements have not been finalized at quarterly or annual financial statement dates, the Company applies the variable constraint guidance under Topic 606, where the Company records revenue to the extent it believes that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. 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, subject to the variable constraint guidance under Topic 606. The following summarizes the significant provisions of each code-share agreement the Company has with each major airline partner through SkyWest Airlines: Delta Connection Agreements Agreement Aircraft type Number of Aircraft Term / Termination Delta Connection Agreement (fixed-fee arrangement) CRJ 200 CRJ 700 CRJ 900 E175 58 22 41 49 Individual aircraft have scheduled removal dates from 2019 to 2029 The average remaining term of the aircraft under contract is 4.1 years Delta Connection Prorate Agreement (revenue-sharing arrangement) CRJ 200 29 Terminable with 30-day notice United Express Agreements Agreement Aircraft type Number of Aircraft Term / Termination United Express Agreements (fixed-fee arrangement) CRJ 200 CRJ 700 E175 65 19 65 Individual aircraft have scheduled removal dates under the agreement between 2019 and 2029 The average remaining term of the aircraft under contract is 7.0 years United Express Prorate Agreement (revenue-sharing arrangement) CRJ 200 25 Terminable with 120-day notice American Agreements Agreement Aircraft type Number of Aircraft Term / Termination Dates American Agreement (fixed-fee arrangement) CRJ 700 58 Individual aircraft have scheduled removal dates from 2019 to 2023 American Prorate Agreement (revenue-sharing arrangement) CRJ 200 7 Terminable with 120-day notice Alaska Capacity Purchase Agreement Agreement Aircraft type Number of Aircraft Term / Termination Alaska Agreement (fixed-fee arrangement) E175 32 Individual aircraft have scheduled removal dates from 2027 to 2030 The following summarizes the code-share agreement activity the Company had with each major airline partner through ExpressJet Airlines: As of December 31, 2018, ExpressJet operated 100 ERJ145 aircraft and 16 CRJ200 aircraft under fixed-fee agreements with United, and 10 CRJ700 aircraft under a fixed-fee agreement with American. ExpressJet’s fixed-fee agreements with United and American were terminated in connection with our sale of ExpressJet in January 2019. ExpressJet also completed the wind down of its flying agreement with Delta by the end of 2018. The Company sold ExpressJet subsequent to December 31, 2018, however the Company retained ownership of the 16 CRJ200 aircraft and the 10 CRJ700 aircraft operated by ExpressJet as of December 31, 2018. The Company agreed to lease the 16 CRJ200 aircraft to ExpressJet for up to a five-year period. The Company is pursuing alternative uses of the 10 CRJ700 aircraft including, but not limited to, using the aircraft under fixed-fee agreements under a short-term basis or leasing the aircraft or aircraft engines to third parties. See Note 12, Subsequent Events , for additional information regarding the sale of ExpressJet. In addition to the contractual arrangements described above, SkyWest Airlines has entered into fixed-fee agreements with Alaska and Delta to place additional E175 aircraft into service for those major airline partners. As of December 31, 2018, the Company anticipated placing an additional three E175 aircraft with Alaska and nine E175 aircraft with Delta. The delivery dates for the new E175 aircraft are currently scheduled to take place by the end 2021. Final delivery dates may adjust based on various factors. SkyWest Airlines also entered into an agreement with Delta in the second quarter of 2018 to operate 20 CRJ900 aircraft under a fixed-fee agreement. As of December 31, 2018, SkyWest Airlines took delivery of five of these CRJ900 aircraft and placed the aircraft into service with Delta. The delivery dates for the remaining 15 aircraft are expected to continue through the end of 2020. These aircraft will replace 20 CRJ700 aircraft scheduled to expire under SkyWest’s flying contracts with Delta. When an aircraft is scheduled to be removed from a fixed-fee arrangement, the Company may, as practical under the circumstances, negotiate an extension with the respective major airline partner, negotiate the placement of the aircraft with another major airline partner, return the aircraft to the lessor if the aircraft is leased and the lease is expiring, place owned aircraft for sale, or pursue other uses for the aircraft. Other uses for the aircraft may include placing the aircraft in a prorate arrangement, leasing the aircraft to a third party or parting out the aircraft to use the engines and parts as spare inventory or to lease the engines to a third party. Airport customer service and other revenues primarily consist of ground handling functions, such as gate and ramp agent services at applicable airports where the Company provides such services. The transaction price for airport service agreements is determined from an agreed-upon rate by location applied to the applicable number of flights handled (measured by departures) by the Company over the agreement term. The Company’s operating 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 renegotiations, 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. |
Deferred Aircraft Credits | Deferred Aircraft Credits The Company accounts for incentives provided by aircraft manufacturers as deferred credits. The deferred credits related to leased aircraft are amortized on a straight‑line basis as a reduction to rent expense over the lease term. Credits related to owned aircraft reduce the purchase price of the aircraft, which has the effect of amortizing the credits on a straight‑line basis as a reduction in depreciation expense over the life of the related aircraft. The incentives are credits that may be used to purchase spare parts and pay for training and other expenses. |
Income Taxes | Income Taxes The Company recognizes a net liability or asset for the deferred tax consequences of all temporary differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements that are expected to result in taxable or deductible amounts in future years when the reported amounts of the assets and liabilities are recovered or settled. |
Net Income (Loss) Per Common Share | Net Income (Loss) Per Common Share Basic net income (loss) per common share (“Basic EPS”) excludes dilution and is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income (loss) 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 (loss) per common share. During the year ended December 31, 2018, 207,000 performance share units (at target performance) were excluded in the computation of Diluted EPS since the Company had not achieved the minimum target thresholds as of December 31, 2018. During the year ended December 31, 2017, 284,000 performance share units (at target performance) were excluded in the computation of Diluted EPS since the Company had not achieved the minimum target thresholds as of December 31, 2017. During the year ended December 31, 2016, 2,077,000 shares reserved for the issuance upon the exercise of outstanding options, performance shares and restricted stock units were excluded from the computation of Diluted EPS due to the net loss in 2016. The calculation of the weighted average number of common shares outstanding for Basic EPS and Diluted EPS are as follows for the years ended December 31, 2018, 2017 and 2016 (in thousands): Year Ended December 31, 2018 2017 2016 Numerator: Net Income (Loss) $ 280,372 $ 428,907 $ (161,586) Denominator: Basic earnings per share weighted average shares 51,914 51,804 51,505 Dilution due to stock options and restricted stock units 957 1,296 — Diluted earnings per share weighted average shares 52,871 53,100 51,505 Basic earnings (loss) per share $ 5.40 $ 8.28 $ (3.14) Diluted earnings (loss) per share $ 5.30 $ 8.08 $ (3.14) |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) includes charges and credits to stockholders’ equity that are not the result of transactions with the Company’s shareholders, including changes in unrealized appreciation on marketable securities. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts reported in the consolidated balance sheets for receivables and accounts payable approximate fair values because of the immediate or short‑term maturity of these financial instruments. Marketable securities are reported at fair value based on market quoted prices in the consolidated balance sheets. If quoted prices in active markets are no longer available, the Company has estimated the fair values of these securities utilizing a discounted cash flow analysis as of December 31, 2018. These analyses consider, among other items, the collateralization underlying the security investments, the creditworthiness of the counterparty, the timing of expected future cash flows, and the expectation of the next time the security is expected to have a successful auction. 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 approximately $3,157.3 million as of December 31, 2018, as compared to the carrying amount of $3,185.4 million as of December 31, 2018. The Company’s fair value of long‑term debt as of December 31, 2017 was $2,698.4 million as compared to the carrying amount of $2,712.4 million as of December 31, 2017. |
Segment Reporting | Segment Reporting Generally accepted accounting principles require disclosures related to components of a company for which separate financial information is available to, and regularly evaluated by, the Company’s chief operating decision maker when deciding how to allocate resources and in assessing performance. The Company’s three operating segments consist of the operations conducted by SkyWest Airlines, ExpressJet and SkyWest Leasing. Information pertaining to the Company’s reportable segments is presented in Note 2, Segment Reporting . |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Standards Effective in Future Years and Not Yet Adopted In February 2016, the FASB issued Accounting Standards Update 2016‑02, “Leases (Topic 842)” (“Topic 842”). Topic 842 amends the existing accounting standards for lease accounting, including requiring lessees to recognize most leases on their balance sheets and making targeted changes to lessor accounting. Topic 842 became effective beginning in the first quarter of 2019. In July 2018, the FASB issued ASU No. 2018-11, “Targeted Improvements - Leases (Topic 842).” This update provides an optional transition method that allows entities to elect to apply the standard prospectively at its effective date, versus recasting the prior periods presented. The Company anticipates electing this adoption method and expects to recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. Lease payments will include fixed and in-substance fixed payments, variable payments based on an index or rate, reasonably certain purchase options, termination penalties, and probable amounts the lessee will owe under a residual value guarantee. Lease payments will not include variable lease payments other than those that depend on an index or rate, any guarantee by the lessee of the lessor’s debt, or any amount allocated to non-lease components. Based on the Company’s initial assessment, the adoption of Topic 842 will significantly increase the Company’s assets and liabilities primarily to reflect its aircraft operating lease liability and related right-of-use asset. As of December 31, 2018, the Company had 260 leased aircraft under operating leases in its fleet. The Company also has operating leases related to terminal operations space and other real estate leases. The Company does not expect the adoption of the New Lease Standard to impact any of its existing debt covenants. Additionally, the Company does not expect the adoption to have a significant impact on the recognition, measurement or presentation of lease revenue and lease expenses within the condensed consolidated statements of operations and comprehensive income or the condensed consolidated statements of cash flows. The Company does not anticipate the adoption of Topic 842 will have a material impact on the timing or amount of the Company’s lease revenue as a lessor. The Company adopted Topic 842 on January 1, 2019. The Company expects to elect the several practical expedients available under the transition provisions of Topic 842, including (i) not reassessing whether expired or existing contracts contain leases, (ii) lease classification, and (iii) not revaluing initial direct costs for existing leases. Also, the Company plans to elect the practical expedient which will allow aggregation of non-lease components with the related lease components when evaluating accounting treatment. Lastly, the Company currently plans to apply the modified retrospective adoption method, utilizing the simplified transition option available in Topic 842, which allows entities to continue to apply the legacy guidance in ASC 840, including its disclosure requirements, in the comparative periods presented in the year of adoption . Upon adoption, the Company anticipates it will reflect a lease liability in the range of $450 to $500 million and a right-of-use asset of $600 to $650 million. Upon adoption, the right-of-use asset is expected to include prepaid aircraft rents, accrued aircraft rents and deferred rent credits that were separately stated in the Company’s December 31, 2018 balance sheet. These estimates are subject to revision based upon the Company’s adoption of Topic 842 in 2019. Recently Adopted Standards The Company adopted Topic 606 as of January 1, 2018, utilizing the full retrospective method of adoption allowed by the standard, in order to provide for comparative results in all periods presented. The adoption of Topic 606 did not have a material impact on recorded amounts when applied to the opening balance sheet as of January 1, 2018. The adoption of Topic 606 only affected the Company’s consolidated balance sheets and statements of comprehensive income classification, with no impact on the Company’s operating income (loss), net income (loss), earnings (loss) per share or cash flows, however the principal versus agent considerations under Topic 606 resulted in the Company recording directly reimbursed fuel expense under its fixed-fee contracts as a reduction to the applicable operating expense (net) rather than revenue (gross). This classification change resulted in a reduction to total revenue and a reduction to operating expenses by the same amount, resulting in no change to operating income. Additionally, under the nonrefundable up-front fees and contract costs considerations of Topic 606, reimbursements from the Company’s major airline partners for up-front contract costs will be deferred and amortized over the contract term. The related up-front costs to obtain the contract will also be capitalized and amortized over the contract term. As the amount of the up-front reimbursement is determined from the Company’s actual costs to fulfill the contract, this change did not impact the Company’s operating income (loss) as the amount of deferred revenue and the amount of capitalized costs will be recognized over the same period. This change also resulted in a deferred revenue liability and a capitalized contract cost on the balance sheet of the same amount. Prior to the Company’s adoption of Topic 606, the Company segregated its revenue into two categories: “Passenger revenue” and “Ground handling and other revenue.” “Passenger revenue” included revenue from fixed-fee contracts, prorate flying agreements and airport customer service agreements for flights operated by the Company. “Ground handling and other revenue” included revenue from airport customer service agreements for flights operated by third parties and other revenue. Under the disaggregated revenue disclosure considerations in Topic 606, the Company segregated its revenue into the following categories: “Flying agreements revenue” and “Airport customer service and other revenues.” “Flying agreements revenue” includes revenue from fixed-fee contracts, prorate flying agreements and other revenue (primarily lease revenue for the use of the aircraft). “Airport customer service and other revenues” includes revenue from airport customer services agreements. This change reclassifies amounts previously reported as “Passenger revenue” and “Ground handling and other revenue”. Additionally, in connection with the Company’s adoption of Topic 606, the Company renamed the operating expense “Ground handling services” to “Airport-related expenses.” Certain airport-related expenses, such as landing fees and airport facility rents, were previously reported as “Other operating expenses” and have been reclassified as “Airport-related expenses.” In 2016, the FASB issued Accounting Standards Update 2016‑15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments” and Accounting Standard Update 2016‑18, “Statement of Cash Flows (Topic 230): Restricted Cash” related to the classification of certain cash receipts and cash payments and the presentation of restricted cash within an entity’s statement of cash flows, respectively. These standards are effective for interim and annual reporting periods beginning after December 15, 2017. The Company adopted this standard in the first quarter of 2018 and modified the presentation to include changes in restricted cash in the Company’s Consolidated Statement of Cash Flows, which had an immaterial impact. Impact of Recently Adopted Standards The Company recast certain prior period amounts to conform with the adoption of Topic 606, as shown in the tables below (in thousands): Year ended December 31, 2017 Income Statement: Previously Reported Adjustments As Adjusted OPERATING REVENUES: Flying agreements (1) $ 3,126,708 $ (48,411) $ Airport customer service and other (2) 77,560 (33,265) Total operating revenues $ $ (81,676) $ OPERATING EXPENSES: Salaries, wages and benefits $ 1,196,227 $ (4,160) $ 1,192,067 Aircraft fuel 162,653 (77,517) Airport-related expenses (3) 69,848 48,526 Other operating expenses 299,303 (48,525) Total operating expenses 2,816,069 (81,676) OPERATING INCOME $ $ — $ 1. In previously reported periods, this line item was presented as passenger revenue. 2. In previously reported periods, this line item was presented as ground handling and other. 3. In previously reported periods, this line item was presented as ground handling services. Year ended December 31, 2016 Income Statement: Previously Reported Adjustments As Adjusted OPERATING REVENUES: Flying agreements (1) $ 3,051,414 $ (40,676) $ Airport customer service and other (2) 69,792 (16,828) Total operating revenues $ 3,121,206 $ (57,504) $ OPERATING EXPENSES: Salaries, wages and benefits $ 1,211,380 $ (5,921) $ Aircraft fuel 122,284 (51,583) Airport-related expenses (3) 72,659 49,482 Other operating expenses 305,041 (49,482) Total operating expenses 3,293,890 (57,504) OPERATING INCOME $ $ — $ 1. In previously reported periods, this line item was presented as passenger revenue. 2. In previously reported periods, this line item was presented as ground handling and other. 3. In previously reported periods, this line item was presented as ground handling services. Balance Sheet: Previously Reported December 31, 2017 Adjustments Current Presentation December 31, 2017 ASSETS: Other long-term assets $ $ $ LIABILITIES: Other long-term liabilities $ $ $ The $16.1 million adjustment to other long-term assets and other long-term liabilities reflects the amount of capitalized up-front contract costs and the amount of deferred revenue for up-front reimbursements as of December 31, 2017. The $16.1 million capitalized contract costs and deferred revenue is expected to be amortized over the applicable remaining contract term. For the year ended December 31, 2018 and 2017, the Company recognized $2.0 million and $1.5 million, respectively, of revenue and operating expense associated with the amortization of the up-front contract reimbursements. As of December 31, 2018, the Company had $64. 2 million in accounts receivable of which $52.7 million related to flying agreements. As of December 31, 2017, the Company had $42.7 million in accounts receivable of which $33.9 million related to flying agreements. |
Nature of Operations and Summ_3
Nature of Operations and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Schedule of number of aircraft held by entity | CRJ200 CRJ700 CRJ900 ERJ145 E175 Total United 106 19 — 100 65 290 Delta 87 22 41 — 49 199 American 7 68 — — — 75 Alaska — — — — 32 32 Aircraft in scheduled service 200 109 41 100 146 596 Subleased to an un-affiliated entity 4 — — — — 4 Other* 4 19 — 5 — 28 Total Fleet 208 128 41 105 146 628 * As of December 31, 2018, these aircraft have been removed from service and are in the process of being returned under the applicable leasing arrangement or are aircraft transitioning between code-share agreements with the Company’s major airline partners. |
Schedule of marketable securities | The Company’s position in marketable securities as of December 31, 2018 and 2017 was as follows (in thousands): Gross unrealized Gross unrealized At December 31, 2018 Amortized Cost holding gains holding losses Fair market value Total cash and cash equivalents $ 328,384 $ — $ — $ 328,384 Marketable securities: Bond and bond funds $ 229,825 $ — $ (42) $ 229,783 Commercial Paper 131,163 — (1) 131,162 Total marketable securities $ 360,988 $ — $ (43) $ 360,945 Total assets measured at fair value $ 689,372 $ — $ (43) $ 689,329 Gross unrealized Gross unrealized At December 31, 2017 Amortized Cost holding gains holding losses Fair market value Total cash and cash equivalents $ 181,792 $ — $ — $ 181,792 Marketable securities: Bond and bond funds $ 344,479 $ — $ (228) $ 344,251 Commercial Paper 159,252 — — 159,252 Total marketable securities $ 503,731 $ — $ (228) $ 503,503 Total assets measured at fair value $ 685,523 $ — $ (228) $ 685,295 |
Schedule of property and equipment | Assets Depreciable Life Current Residual Value Aircraft, rotable spares, and spare engines up to 22 years up to 20 % Ground equipment up to 10 years 0 % Office equipment up to 7 years % Leasehold improvements Shorter of 15 years or lease term % Buildings 20 - 39.5 years % |
Schedule of flying agreement revenue data | The following table represents the Company’s flying agreements revenue by type for the year ended December 31, 2018 and 2017 (in thousands): For the year ended December 31, 2018 2017 2016 Capacity purchase agreements revenue: flight operations $ 1,856,253 $ 1,805,510 $ 1,792,868 Capacity purchase agreements revenue: aircraft lease 814,518 834,366 763,406 Prorate agreements revenue 498,749 438,421 454,464 Flying agreements revenue $ 3,169,520 $ 3,078,297 $ 3,010,738 |
Schedule of net income per common share | Year Ended December 31, 2018 2017 2016 Numerator: Net Income (Loss) $ 280,372 $ 428,907 $ (161,586) Denominator: Basic earnings per share weighted average shares 51,914 51,804 51,505 Dilution due to stock options and restricted stock units 957 1,296 — Diluted earnings per share weighted average shares 52,871 53,100 51,505 Basic earnings (loss) per share $ 5.40 $ 8.28 $ (3.14) Diluted earnings (loss) per share $ 5.30 $ 8.08 $ (3.14) |
ASU 2014-09 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Schedule of impact on financial statements, adoption of Topic 606 | The Company recast certain prior period amounts to conform with the adoption of Topic 606, as shown in the tables below (in thousands): Year ended December 31, 2017 Income Statement: Previously Reported Adjustments As Adjusted OPERATING REVENUES: Flying agreements (1) $ 3,126,708 $ (48,411) $ Airport customer service and other (2) 77,560 (33,265) Total operating revenues $ $ (81,676) $ OPERATING EXPENSES: Salaries, wages and benefits $ 1,196,227 $ (4,160) $ 1,192,067 Aircraft fuel 162,653 (77,517) Airport-related expenses (3) 69,848 48,526 Other operating expenses 299,303 (48,525) Total operating expenses 2,816,069 (81,676) OPERATING INCOME $ $ — $ 1. In previously reported periods, this line item was presented as passenger revenue. 2. In previously reported periods, this line item was presented as ground handling and other. 3. In previously reported periods, this line item was presented as ground handling services. Year ended December 31, 2016 Income Statement: Previously Reported Adjustments As Adjusted OPERATING REVENUES: Flying agreements (1) $ 3,051,414 $ (40,676) $ Airport customer service and other (2) 69,792 (16,828) Total operating revenues $ 3,121,206 $ (57,504) $ OPERATING EXPENSES: Salaries, wages and benefits $ 1,211,380 $ (5,921) $ Aircraft fuel 122,284 (51,583) Airport-related expenses (3) 72,659 49,482 Other operating expenses 305,041 (49,482) Total operating expenses 3,293,890 (57,504) OPERATING INCOME $ $ — $ 1. In previously reported periods, this line item was presented as passenger revenue. 2. In previously reported periods, this line item was presented as ground handling and other. 3. In previously reported periods, this line item was presented as ground handling services. Balance Sheet: Previously Reported December 31, 2017 Adjustments Current Presentation December 31, 2017 ASSETS: Other long-term assets $ $ $ LIABILITIES: Other long-term liabilities $ $ $ |
Delta Connection Agreement | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Schedule of details of aircraft and agreements with other airlines | Delta Connection Agreements Agreement Aircraft type Number of Aircraft Term / Termination Delta Connection Agreement (fixed-fee arrangement) CRJ 200 CRJ 700 CRJ 900 E175 58 22 41 49 Individual aircraft have scheduled removal dates from 2019 to 2029 The average remaining term of the aircraft under contract is 4.1 years Delta Connection Prorate Agreement (revenue-sharing arrangement) CRJ 200 29 Terminable with 30-day notice |
United Express Agreements | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Schedule of details of aircraft and agreements with other airlines | Agreement Aircraft type Number of Aircraft Term / Termination United Express Agreements (fixed-fee arrangement) CRJ 200 CRJ 700 E175 65 19 65 Individual aircraft have scheduled removal dates under the agreement between 2019 and 2029 The average remaining term of the aircraft under contract is 7.0 years United Express Prorate Agreement (revenue-sharing arrangement) CRJ 200 25 Terminable with 120-day notice |
American Agreements | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Schedule of details of aircraft and agreements with other airlines | Agreement Aircraft type Number of Aircraft Term / Termination Dates American Agreement (fixed-fee arrangement) CRJ 700 58 Individual aircraft have scheduled removal dates from 2019 to 2023 American Prorate Agreement (revenue-sharing arrangement) CRJ 200 7 Terminable with 120-day notice |
Alaska Capacity Purchase Agreement | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Schedule of details of aircraft and agreements with other airlines | Alaska Capacity Purchase Agreement Agreement Aircraft type Number of Aircraft Term / Termination Alaska Agreement (fixed-fee arrangement) E175 32 Individual aircraft have scheduled removal dates from 2027 to 2030 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Segment Reporting | |
Schedule of Company's segment data | The following represents the Company’s segment data for the years ended December 31, 2018, 2017 and 2016 (in thousands). Year Ended December 31, 2018 SkyWest Airlines ExpressJet SkyWest Leasing Consolidated Operating revenues $ 2,346,251 $ 564,202 $ 311,226 $ 3,221,679 Operating expense 2,022,560 577,608 147,231 2,747,399 Depreciation and amortization expense 155,511 37,290 141,788 334,589 Interest expense 17,021 2,340 101,048 120,409 Segment profit (loss) (1) 306,670 (15,746) 62,947 353,871 Total assets 2,531,707 279,303 3,502,202 6,313,212 Capital expenditures (including non-cash) 149,731 10,137 996,408 1,156,276 Year Ended December 31, 2017 SkyWest Airlines ExpressJet SkyWest Leasing Consolidated Operating revenues $ 2,092,368 $ 790,282 $ 239,942 $ 3,122,592 Operating expense 1,807,540 818,683 108,170 2,734,393 Depreciation and amortization expense 134,563 51,982 106,223 292,768 Interest expense 21,544 4,127 79,254 104,925 Segment profit (loss) (1) 263,284 (32,528) 52,518 283,274 Identifiable intangible assets, other than goodwill — 4,896 — 4,896 Total assets 2,245,051 599,122 2,630,227 5,474,400 Capital expenditures (including non-cash) 124,955 14,278 550,165 689,398 Year Ended December 31, 2016 SkyWest Airlines ExpressJet SkyWest Leasing Consolidated Operating revenues $ $ $ $ 3,063,702 Operating expense 68,148 3,236,386 Depreciation and amortization expense 139,159 83,935 61,875 284,969 Special items 184,295 281,354 — 465,649 Interest expense 26,211 6,773 45,193 78,177 Segment profit (loss) (1) 22,994 (301,514) 27,659 (250,861) Identifiable intangible assets, other than goodwill — 8,249 — 8,249 Total assets 5,007,966 Capital expenditures (including non-cash) 1,159,001 Segment profit is operating income less interest expense |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Long-Term Debt | |
Schedule of long-term debt | Long‑term debt consisted of the following as of December 31, 2018 and 2017 (in thousands): December 31, December 31, 2018 2017 Notes payable to banks, due in semi-annual installments, variable interest based on LIBOR, or with an interest rate of 4.00% through 2019, secured by aircraft $ 6,429 $ 34,905 Notes payable to a financing company, due in semi-annual installments, variable interest based on LIBOR, or with an interest rate of 3.25% through 2021, secured by aircraft 36,324 97,612 Notes payable to banks, due in semi-annual installments plus interest at 6.10% to 6.51% through 2021, secured by aircraft 41,592 63,090 Notes payable to banks, due in monthly installments plus interest of 2.68% to 6.86% through 2025, secured by aircraft 371,300 372,157 Notes payable to banks, due in monthly installments, plus interest at 4.07% to 6.05% through 2029, secured by aircraft 105,069 49,001 Notes payable to banks, due in quarterly installments, plus interest at 3.39% to 5.08% through 2030, secured by aircraft 2,621,416 2,085,822 Notes payable to banks due in monthly installments, interest at 3.30% through 2019, secured by spare engines 3,308 9,763 Long-term debt $ 3,185,438 $ 2,712,350 Current portion of long-term debt (354,072) (313,243) Less long-term portion of unamortized debt issue cost, net (21,598) (21,761) Long-term debt, net of current maturities and debt issue costs $ 2,809,768 $ 2,377,346 Current portion of long-term debt 354,072 313,243 Less current portion of unamortized debt issue cost, net (3,866) (3,565) Current portion of long-term debt, net of debt issue costs $ 350,206 $ 309,678 |
Schedule of maturities of long-term debt | The aggregate amounts of principal maturities of long‑term debt as of December 31, 2018 were as follows (in thousands): 2019 $ 354,072 2020 2021 2022 2023 Thereafter $ 3,185,438 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Income Taxes | |
Schedule of components of provision (benefit) for income taxes | The provision (benefit) for income taxes includes the following components (in thousands): Year ended December 31, 2018 2017 2016 Current tax provision (benefit): Federal $ (21,598) $ 5,853 $ (3,801) State 1,465 180 111 Foreign 1,575 — — (18,558) 6,033 (3,690) Deferred tax provision (benefit): Federal 92,250 (166,890) (77,430) State 12,250 20,133 (6,106) 104,500 (146,757) (83,536) Provision (benefit) for income taxes $ 85,942 $ (140,724) $ (87,226) |
Schedule of income tax rate reconciliation | The following is a reconciliation between a federal income tax rate of 21% for 2018 and 35% for 2017 and 2016 of income (loss) before income taxes and the effective tax rate which is derived by dividing the provision (benefit) for income taxes by the income (loss) before the provision for income (loss) taxes (in thousands): Year ended December 31, 2018 2017 2016 Computed provision (benefit) for income taxes at the statutory rate $ 76,926 $ 100,864 $ (87,084) Increase (decrease) in income taxes resulting from: State income tax provision (benefit), net of federal income tax benefit 12,711 7,778 (5,768) Non-deductible expenses 1,956 3,230 3,552 Valuation allowance changes affecting the provision for income taxes (1,187) 505 751 Foreign income taxes, net of federal & state benefit 1,192 — — Excess tax benefits from share-based compensation (4,548) (5,377) — Revaluation of net deferred taxes for the Tax Act — (246,845) — Other, net (1,108) (879) 1,323 Provision (benefit) for income taxes $ 85,942 $ (140,724) $ (87,226) |
Schedule of components of the net deferred tax assets and liabilities | The significant components of the Company’s net deferred tax assets and liabilities as of December 31, 2018 and 2017 are as follows (in thousands): As of December 31, 2018 2017 Deferred tax assets: Accrued benefits $ 32,462 $ 31,651 Net operating loss carryforward 344,375 122,648 AMT credit carryforward 15,744 23,443 Aircraft credits 35,924 53,870 Accrued reserves and other 18,710 26,647 Total deferred tax assets 447,215 258,259 Valuation allowance (9,455) (10,642) Deferred tax liabilities: Accelerated depreciation (955,919) (666,637) Total deferred tax liabilities (955,919) (666,637) Net deferred tax liability $ (518,159) $ (419,020) |
Schedule of unrecognized tax benefits | Unrecognized tax benefits at the beginning of year $ 2,223 Gross increases - current year tax positions 13,899 Gross increases - prior year tax positions - Gross decreases - prior year tax positions (1,569) Unrecognized tax benefits at end of year $ 14,553 Interest and penalties in year-end balance - |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
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 have non‑cancelable lease terms as of December 31, 2018 (in thousands): 2019 $ 87,256 2020 101,741 2021 90,787 2022 72,593 2023 65,749 Thereafter 59,820 $ 477,946 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Fair Value Measurements | |
Schedule of assets measured at fair value on a recurring basis | As of December 31, 2018, 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 December 31, 2018 Total Level 1 Level 2 Level 3 Marketable Securities Bonds and bond funds $ 229,783 $ — $ $ — Commercial paper 131,162 — — $ 360,945 $ — $ $ — Cash, Cash Equivalents and Restricted Cash 328,384 — — Total Assets Measured at Fair Value $ 689,329 $ $ $ — Fair Value Measurements as of December 31, 2017 Total Level 1 Level 2 Level 3 Marketable Securities Bonds and bond funds $ 344,251 $ — $ $ — Commercial paper — — $ $ — $ $ — Cash, Cash Equivalents and Restricted Cash — — Total Assets Measured at Fair Value $ 685,295 $ $ 503,503 $ — |
Special Items (Tables)
Special Items (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Special Items | |
Summary of the components of special items | The following table summarizes the components of the Company's special items, for the year ended December 31, 2018, 2017 and 2016 (in thousands): Year ended December 31, 2018 2017 2016 Special items: CRJ200 aircraft related items 1 $ — $ — $ 424,466 ERJ145 aircraft related items 2 — — 41,183 Total special items $ — $ — $ 465,649 (1) Consists primarily of inventory valuation charges and impairment charges to write-down CRJ200 aircraft including related long-lived assets to their estimated fair value. The estimated fair value of the long-lived assets, including the aircraft and fixed asset spare parts inventory, was based on third-party appraisals on the assets. These values were estimated based on listed market values or recent third-party market transactions for similar assets. Additionally, the Company estimated the fair value of certain long-lived prepaid lease assets using the net present value of estimated current CRJ200 lease rates. All fair values are considered to be Level 3 within the fair value hierarchy. Of the special items $184.3 million related to SkyWest Airlines and $240.2 million related to ExpressJet. These charges are net of $90 million in cash proceeds and other considerations from the Bombardier termination agreement. These special items are reflected in the SkyWest Airlines and ExpressJet operating expenses under Note 2 Segment Reporting. (2) The ERJ145 aircraft related items recorded in the 2016 special charge consist primarily of inventory valuation charges and impairment charges to write-down certain ERJ145 long-lived assets, which primarily consisted of spare engines and ERJ145 spare aircraft parts, to their estimated fair value of $41.2 million. The estimated fair value of the long-lived assets was based on third-party appraisals and valuations for similar assets which is considered an unobservable input (Level 3) under the fair value hierarchy. These special items are reflected in the ExpressJet operating expenses under Note 2 Segment Reporting . |
Capital Transactions (Tables)
Capital Transactions (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Schedule of assumptions used and weighted average fair value for stock option grants | 2016 Expected annual dividend rate 1.08 % Risk-free interest rate 1.15 % Average expected life (years) 5.7 Expected volatility of common stock 0.412 Forfeiture rate % Weighted average fair value of option grants $ 5.27 |
Schedule of stock option activity | 2018 2017 2016 Weighted Weighted Average Aggregate Weighted Weighted Average Remaining Intrinsic Average Average Number of Exercise Contractual Value Number of Exercise Number of Exercise Options Price Term ($000) Options Price Options Price Outstanding at beginning of year 458,103 $ 13.73 4.0 years $ 18,034.1 819,981 $ 13.58 1,064,429 $ 13.64 Granted — — — — 206,021 14.90 Exercised (157,523) 13.80 (356,209) 13.36 (351,296) 14.17 Cancelled — — (5,669) 14.33 (99,173) 14.90 Outstanding at end of year 300,580 13.70 3.0 years $ 9,249.4 458,103 13.73 819,981 13.58 Exercisable at December 31, 2018 235,672 13.36 2.7 years $ 7,330.7 Exercisable at December 31, 2017 254,192 13.17 3.4 years $ 10,150.8 |
Schedule of non-vested stock options | Weighted-Average Number of Grant-Date Shares Fair Value Non-vested shares at beginning of year $ 5.17 Granted — — Vested (139,003) 5.10 Cancelled — — Non-vested shares at end of year $ 5.32 |
Schedule of stock options outstanding | Options Outstanding Options Exercisable Weighted Average Number Remaining Weighted Average Number Weighted Average Range of Exercise Prices Outstanding Contractual Life Exercise Price Exercisable Exercise Price $12.00 to $13.99 2.4 years $ 13.04 $ $14.00 to $15.99 4.1 years $16.00 to $19.00 3.8 years $12.00 to $19.00 3.0 years $ $ |
Schedule of restricted stock activity | : Weighted-Average Grant-Date Fair Number of RSUs Value Non-vested RSUs outstanding at December 31, 2015 809,299 $ 13.13 Granted 384,148 14.81 Vested (215,146) 13.29 Cancelled (51,370) 13.72 Non-vested RSUs outstanding at December 31, 2016 926,931 $ 13.65 Granted 160,137 35.81 Vested (230,903) 12.01 Cancelled (40,575) 15.78 Non-vested RSUs outstanding at December 31, 2017 815,590 $ 18.35 Granted 115,044 53.40 Vested (330,580) 13.57 Cancelled (24,273) 27.77 Non-vested RSUs outstanding at December 31, 2018 575,781 $ 27.71 |
Performance stock units | |
Schedule of non-vested stock options | The following table summarizes the activity of performance share units granted at target as of December 31, 2018. Weighted-Average Grant-Date Number of PSUs Fair Value Non-vested PSUs outstanding at December 31, 2015 202,829 $ 13.62 Granted 14.89 Vested — — Cancelled (22,413) 14.16 Non-vested PSUs outstanding at December 31, 2016 363,993 $ 14.23 Granted 35.81 Vested — — Cancelled (14,732) 15.00 Non-vested PSUs outstanding at December 31, 2017 $ 19.70 Granted 53.41 Additional PSUs awarded from the 2015 grant 13.62 Vested Cancelled (3,229) 30.09 Non-vested PSUs outstanding at December 31, 2018 $ 30.84 |
Retirement Plans and Employee_2
Retirement Plans and Employee Stock Purchase Plans (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Retirement Plans and Employee Stock Purchase Plans | |
Schedule of purchases made under the 2009 Employee Stock Purchase Plans | Year ended December 31, 2018 2017 2016 Number of shares purchased 60,950 88,362 151,531 Average price of shares purchased $ 49.85 $ 33.96 $ 20.87 |
Quarterly Financial Data (Una_2
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Quarterly Financial Data (Unaudited) | |
Schedule of Quarterly Financial Data (Unaudited) | Year ended December 31, 2018 First Second Third Fourth Quarter Quarter Quarter Quarter Year Operating revenues $ 783,400 $ 805,515 $ 829,275 $ 803,489 $ Operating income 88,175 126,678 137,925 121,502 474,280 Net income 54,362 75,859 83,046 67,105 280,372 Net income per common share: Basic 1.30 5.40 Diluted 1.28 5.30 Weighted average common shares: Basic: 51,921 52,046 52,039 51,650 51,914 Diluted: 53,033 52,913 52,981 52,556 52,871 Year ended December 31, 2017 First Second Third Fourth Quarter Quarter Quarter Quarter Year Operating revenues $ 747,166 $ 791,512 $ 812,673 $ $ Operating income 76,295 106,596 112,369 92,939 388,199 Net income (1) 34,786 50,477 53,716 289,928 428,907 Net income per common share: Basic 5.60 8.28 Diluted 5.46 8.08 Weighted average common shares: Basic: 51,820 51,751 51,833 Diluted: 53,202 52,977 53,080 Net income for 2017 included a $246.8 million benefit related to the revaluation of the Company’s deferred tax liability and other tax liabilities in accordance with the Tax Act. |
Nature of Operations and Summ_4
Nature of Operations and Summary of Significant Accounting Policies - Aircraft Fleet (Details) | 12 Months Ended | |
Dec. 31, 2018itemaircraft | Dec. 31, 2016item | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of daily departures to different destinations | item | 2,770 | |
Number of aircraft held by entity | 628 | |
Number of seats on aircraft | item | 50 | |
CRJ 200 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 208 | |
CRJ 700 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 128 | |
CRJ 900 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 41 | |
ERJ 145 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 105 | |
E 175 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 146 | |
United | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 290 | |
Percentage of aggregate capacity operated | 48.60% | |
United | CRJ 200 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 106 | |
United | CRJ 700 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 19 | |
United | ERJ 145 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 100 | |
United | E 175 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 65 | |
Delta | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 199 | |
Percentage of aggregate capacity operated | 33.40% | |
Delta | CRJ 200 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 87 | |
Delta | CRJ 700 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 22 | |
Delta | CRJ 900 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 41 | |
Delta | E 175 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 49 | |
American | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 75 | |
Percentage of aggregate capacity operated | 12.60% | |
American | CRJ 200 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 7 | |
American | CRJ 700 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 68 | |
Alaska | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 32 | |
Percentage of aggregate capacity operated | 5.40% | |
Alaska | E 175 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 32 | |
Aircraft in scheduled service | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 596 | |
Aircraft in scheduled service | CRJ 200 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 200 | |
Aircraft in scheduled service | CRJ 700 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 109 | |
Aircraft in scheduled service | CRJ 900 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 41 | |
Aircraft in scheduled service | ERJ 145 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 100 | |
Aircraft in scheduled service | E 175 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 146 | |
Subleased to an un-affiliated entity | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 4 | |
Subleased to an un-affiliated entity | CRJ 200 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 4 | |
Other | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 28 | |
Other | CRJ 200 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 4 | |
Other | CRJ 700 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 19 | |
Other | ERJ 145 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 5 |
Nature of Operations and Summ_5
Nature of Operations and Summary of Significant Accounting Policies - Cash and Cash Equivalents (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Nature of Operations and Summary of Significant Accounting Policies | ||
Restricted cash | $ 0 | $ 0 |
Nature of Operations and Summ_6
Nature of Operations and Summary of Significant Accounting Policies - Marketable Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule of Available-for-sale Securities [Line Items] | ||||
Total cash and cash equivalents | $ 328,384 | $ 181,792 | $ 146,766 | $ 203,035 |
Amortized Cost | 360,988 | 503,731 | ||
Gross unrealized holding losses | (43) | (228) | ||
Marketable securities | 360,945 | 503,503 | ||
Total Assets Measured at Fair Value - Amortized cost | 689,372 | 685,523 | ||
Total cash and cash equivalents and available for sale securities, fair market value | $ 689,329 | 685,295 | ||
Marketable Securities | ||||
Maximum period for redemption | 1 year | |||
Bonds and bond funds | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | $ 229,825 | 344,479 | ||
Gross unrealized holding losses | (42) | (228) | ||
Marketable securities | 229,783 | 344,251 | ||
Commercial paper | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | 131,163 | 159,252 | ||
Gross unrealized holding losses | (1) | |||
Marketable securities | $ 131,162 | $ 159,252 |
Nature of Operations and Summ_7
Nature of Operations and Summary of Significant Accounting Policies - Inventories (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Inventories | ||
Inventory allowance | $ 22.1 | $ 17.1 |
Nature of Operations and Summ_8
Nature of Operations and Summary of Significant Accounting Policies - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2018 | |
Aircraft, rotable spares, and spare engines | Maximum | |
Property and Equipment | |
Depreciable Life | 22 years |
Residual Value (as a percent) | 20.00% |
Ground equipment | |
Property and Equipment | |
Residual Value (as a percent) | 0.00% |
Ground equipment | Maximum | |
Property and Equipment | |
Depreciable Life | 10 years |
Office equipment | |
Property and Equipment | |
Residual Value (as a percent) | 0.00% |
Office equipment | Maximum | |
Property and Equipment | |
Depreciable Life | 7 years |
Leasehold improvements | |
Property and Equipment | |
Residual Value (as a percent) | 0.00% |
Leasehold improvements | Maximum | |
Property and Equipment | |
Depreciable Life | 15 years |
Buildings | |
Property and Equipment | |
Residual Value (as a percent) | 0.00% |
Buildings | Minimum | |
Property and Equipment | |
Depreciable Life | 20 years |
Buildings | Maximum | |
Property and Equipment | |
Depreciable Life | 39 years 6 months |
Nature of Operations and Summ_9
Nature of Operations and Summary of Significant Accounting Policies - Long-Lived Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Impairment of Long Lived and Intangible Assets | ||
Property and equipment and related assets | $ 6,767,472 | $ 5,650,478 |
Impairment of long-lived assets | $ 0 | $ 0 |
Nature of Operations and Sum_10
Nature of Operations and Summary of Significant Accounting Policies - Capitalized Interest (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Capitalized Interest | |||
Capitalized interest costs | $ 1.5 | $ 1.4 | $ 1.5 |
Nature of Operations and Sum_11
Nature of Operations and Summary of Significant Accounting Policies - Flying Agreements and Airport Customer Service and Other Revenues (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2018USD ($)aircraft | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2018USD ($)aircraft | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($)item | |||
Agreements with other airlines | |||||||||||||
Percentage of ASMs flown under fixed-fee arrangements | 84.30% | ||||||||||||
Percentage of ASMs flown under pro-rate arrangements | 15.70% | ||||||||||||
Revenues [Abstract] | |||||||||||||
Operating revenues | $ | $ 803,489 | $ 829,275 | $ 805,515 | $ 783,400 | $ 771,241 | $ 812,673 | $ 791,512 | $ 747,166 | $ 3,221,679 | $ 3,122,592 | [1] | $ 3,063,702 | [1] |
Number of seats on aircraft | item | 50 | ||||||||||||
Alaska Capacity Purchase Agreement | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft | 32 | ||||||||||||
Sky West Airlines Inc | Delta Connection Agreement | |||||||||||||
Revenues [Abstract] | |||||||||||||
Term of agreement | 4 years 1 month 6 days | ||||||||||||
Sky West Airlines Inc | Delta Connection Prorate Agreement | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft | 29 | ||||||||||||
Notice period for termination of agreement | 30 days | ||||||||||||
Sky West Airlines Inc | United Express Agreements | |||||||||||||
Revenues [Abstract] | |||||||||||||
Term of agreement | 7 years | ||||||||||||
Sky West Airlines Inc | United Express Prorate Agreement | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft | 25 | ||||||||||||
Notice period for termination of agreement | 120 days | ||||||||||||
Sky West Airlines Inc | American Capacity Purchase Agreement | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft | 58 | ||||||||||||
Sky West Airlines Inc | American Prorate Agreement | |||||||||||||
Revenues [Abstract] | |||||||||||||
Notice period for termination of agreement | 120 days | ||||||||||||
ExpressJet | |||||||||||||
Revenues [Abstract] | |||||||||||||
Lease term (in years) | 5 years | 5 years | |||||||||||
Number of aircrafts to be leased | 16 | ||||||||||||
CRJ 200 | Sky West Airlines Inc | Delta Connection Agreement | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft | 58 | ||||||||||||
CRJ 200 | Sky West Airlines Inc | United Express Agreements | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft | 65 | ||||||||||||
CRJ 200 | Sky West Airlines Inc | American Prorate Agreement | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft | 7 | ||||||||||||
CRJ 200 | ExpressJet | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft ownership retained | 16 | 16 | |||||||||||
CRJ 200 | ExpressJet | United Express Agreements | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft | 16 | ||||||||||||
CRJ 700 | Sky West Airlines Inc | Delta Connection Agreement | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft | 22 | ||||||||||||
CRJ 700 | Sky West Airlines Inc | United Express Agreements | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft | 19 | ||||||||||||
CRJ 700 | ExpressJet | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft ownership retained | 10 | 10 | |||||||||||
CRJ 700 | ExpressJet | American Capacity Purchase Agreement | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft | 10 | ||||||||||||
CRJ 900 | Sky West Airlines Inc | Delta Connection Agreement | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft | 41 | ||||||||||||
E 175 | Sky West Airlines Inc | Delta Connection Agreement | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft | 49 | ||||||||||||
Number of aircrafts anticipated to place in service | 9 | 9 | |||||||||||
E 175 | Sky West Airlines Inc | United Express Agreements | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft | 65 | ||||||||||||
E 175 | Sky West Airlines Inc | Alaska Capacity Purchase Agreement | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircrafts anticipated to place in service | 3 | 3 | |||||||||||
ERJ 145 | ExpressJet | United Express Agreements | |||||||||||||
Revenues [Abstract] | |||||||||||||
Number of aircraft | 100 | ||||||||||||
Flying agreements | |||||||||||||
Revenues [Abstract] | |||||||||||||
Operating revenues | $ | $ 3,169,520 | 3,078,297 | [1] | $ 3,010,738 | [1] | ||||||||
Flight operations | |||||||||||||
Revenues [Abstract] | |||||||||||||
Operating revenues | $ | 1,856,253 | 1,805,510 | 1,792,868 | ||||||||||
Aircraft lease | |||||||||||||
Revenues [Abstract] | |||||||||||||
Operating revenues | $ | 814,518 | 834,366 | 763,406 | ||||||||||
Prorate agreements | |||||||||||||
Revenues [Abstract] | |||||||||||||
Operating revenues | $ | $ 498,749 | $ 438,421 | $ 454,464 | ||||||||||
[1] | Amounts adjusted due to the adoption of Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606). See Note 1 to the financial statements of this report for additional information. |
Nature of Operations and Sum_12
Nature of Operations and Summary of Significant Accounting Policies - Agreements (Details) | 12 Months Ended | |
Dec. 31, 2018aircraft | Dec. 31, 2016item | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 628 | |
Number of seats on aircraft | item | 50 | |
CRJ 200 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 208 | |
CRJ 700 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 128 | |
CRJ 900 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 41 | |
E 175 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 146 | |
ERJ 145 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 105 | |
Alaska | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 32 | |
Alaska | E 175 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 32 | |
Delta | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 199 | |
Delta | CRJ 200 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 87 | |
Delta | CRJ 700 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 22 | |
Delta | CRJ 900 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 41 | |
Delta | E 175 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 49 | |
Delta Connection Agreement | Sky West Airlines Inc | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Term of agreement | 4 years 1 month 6 days | |
United Express Agreements | Sky West Airlines Inc | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Term of agreement | 7 years | |
American | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 75 | |
American | CRJ 200 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 7 | |
American | CRJ 700 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 68 | |
Aircraft in scheduled service | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 596 | |
Aircraft in scheduled service | CRJ 200 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 200 | |
Aircraft in scheduled service | CRJ 700 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 109 | |
Aircraft in scheduled service | CRJ 900 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 41 | |
Aircraft in scheduled service | E 175 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 146 | |
Aircraft in scheduled service | ERJ 145 | ||
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | ||
Number of aircraft held by entity | 100 |
Nature of Operations and Sum_13
Nature of Operations and Summary of Significant Accounting Policies - Net Income (Loss) Per Share and Fair Value (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2018USD ($)$ / sharesshares | Sep. 30, 2018USD ($)$ / sharesshares | Jun. 30, 2018USD ($)$ / sharesshares | Mar. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Sep. 30, 2017USD ($)$ / sharesshares | Jun. 30, 2017USD ($)$ / sharesshares | Mar. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2018USD ($)segment$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares | |||
Net Income (loss) Per Common Share | |||||||||||||
Number of outstanding units not included in computation of Diluted EPS (in shares) | 207,000 | 284,000 | 2,077,000 | ||||||||||
Numerator | |||||||||||||
Net income (loss) | $ | $ 67,105 | $ 83,046 | $ 75,859 | $ 54,362 | $ 289,928 | $ 53,716 | $ 50,477 | $ 34,786 | $ 280,372 | $ 428,907 | [1] | $ (161,586) | [1] |
Denominator | |||||||||||||
Basic earnings per share weighted average shares (in shares) | 51,650,000 | 52,039,000 | 52,046,000 | 51,921,000 | 51,811,000 | 51,833,000 | 51,751,000 | 51,820,000 | 51,914,000 | 51,804,000 | [1] | 51,505,000 | [1] |
Dilution due to stock options and restricted stock units (in shares) | 957,000 | 1,296,000 | |||||||||||
Diluted earnings per share weighted average shares (in shares) | 52,556,000 | 52,981,000 | 52,913,000 | 53,033,000 | 53,140,000 | 53,080,000 | 52,977,000 | 53,202,000 | 52,871,000 | 53,100,000 | [1] | 51,505,000 | [1] |
Basic earnings (loss) per-share (in dollars per share) | $ / shares | $ 1.30 | $ 1.60 | $ 1.46 | $ 1.05 | $ 5.60 | $ 1.04 | $ 0.98 | $ 0.67 | $ 5.40 | $ 8.28 | [1] | $ (3.14) | [1] |
Diluted earnings (loss) per-share (in dollars per share) | $ / shares | $ 1.28 | $ 1.57 | $ 1.43 | $ 1.03 | $ 5.46 | $ 1.01 | $ 0.95 | $ 0.65 | $ 5.30 | $ 8.08 | [1] | $ (3.14) | [1] |
Fair Value of Financial Instruments | |||||||||||||
Fair value of long-term debt | $ | $ 3,157,300 | $ 2,698,400 | $ 3,157,300 | $ 2,698,400 | |||||||||
Total long-term debt | $ | $ 3,185,438 | $ 2,712,350 | $ 3,185,438 | $ 2,712,350 | |||||||||
Segment Reporting | |||||||||||||
Number of operating segments | segment | 3 | ||||||||||||
[1] | Amounts adjusted due to the adoption of Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606). See Note 1 to the financial statements of this report for additional information. |
Nature of Operations and Sum_14
Nature of Operations and Summary of Significant Accounting Policies - Recent Accounting Pronouncements (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||
Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2018USD ($)aircraft | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Jan. 01, 2019USD ($) | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||||
Number of aircraft leased | aircraft | 260 | |||||||||||||
Accounts receivable | $ 64,194 | $ 42,731 | $ 64,194 | $ 42,731 | ||||||||||
Income Statement: | ||||||||||||||
Total operating revenues | 803,489 | $ 829,275 | $ 805,515 | $ 783,400 | 771,241 | $ 812,673 | $ 791,512 | $ 747,166 | 3,221,679 | 3,122,592 | [1] | $ 3,063,702 | [1] | |
Salaries, wages and benefits | 1,201,518 | 1,192,067 | [1] | 1,205,459 | [1] | |||||||||
Other operating expenses | 272,826 | 250,778 | [1] | 255,559 | [1] | |||||||||
Total operating expenses | 2,747,399 | 2,734,393 | [1] | 3,236,386 | [1] | |||||||||
Operating income | 121,502 | $ 137,925 | $ 126,678 | $ 88,175 | 92,939 | $ 112,369 | $ 106,596 | $ 76,295 | 474,280 | 388,199 | [1] | (172,684) | [1] | |
ASSETS | ||||||||||||||
Other long-term assets | 104,844 | 65,341 | 104,844 | 65,341 | ||||||||||
LIABILITIES: | ||||||||||||||
Other long-term liabilities | 66,870 | 58,662 | $ 66,870 | 58,662 | ||||||||||
Operating Leases, Number of Aircraft Leased | aircraft | 260 | |||||||||||||
Flying agreements | ||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||||
Accounts receivable | $ 52,700 | 33,900 | $ 52,700 | 33,900 | ||||||||||
Income Statement: | ||||||||||||||
Total operating revenues | 3,169,520 | 3,078,297 | [1] | 3,010,738 | [1] | |||||||||
Airport customer service and other | ||||||||||||||
Income Statement: | ||||||||||||||
Total operating revenues | 52,159 | 44,295 | [1] | 52,964 | [1] | |||||||||
Aircraft fuel | ||||||||||||||
Income Statement: | ||||||||||||||
Total operating expenses | 117,657 | 85,136 | [1] | 70,701 | [1] | |||||||||
Airport related expenses | ||||||||||||||
Income Statement: | ||||||||||||||
Total operating expenses | 109,605 | 118,374 | [1] | 122,141 | [1] | |||||||||
Up-front contract reimbursements | ||||||||||||||
Income Statement: | ||||||||||||||
Total operating expenses | $ 2,000 | 1,500 | ||||||||||||
ASU 2016-02 | Forecast | Maximum | ||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||||
Lease liability | $ 500,000 | |||||||||||||
Right-of-Use Asset | 650,000 | |||||||||||||
ASU 2016-02 | Forecast | Minimum | ||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||||
Lease liability | 450,000 | |||||||||||||
Right-of-Use Asset | $ 600,000 | |||||||||||||
ASU 2014-09 | Previously Reported | ||||||||||||||
Income Statement: | ||||||||||||||
Total operating revenues | 3,204,268 | 3,121,206 | ||||||||||||
Salaries, wages and benefits | 1,196,227 | 1,211,380 | ||||||||||||
Other operating expenses | 299,303 | 305,041 | ||||||||||||
Total operating expenses | 2,816,069 | 3,293,890 | ||||||||||||
Operating income | 388,199 | (172,684) | ||||||||||||
ASSETS | ||||||||||||||
Other long-term assets | 49,220 | 49,220 | ||||||||||||
LIABILITIES: | ||||||||||||||
Other long-term liabilities | 42,541 | 42,541 | ||||||||||||
ASU 2014-09 | Previously Reported | Flying agreements | ||||||||||||||
Income Statement: | ||||||||||||||
Total operating revenues | 3,126,708 | 3,051,414 | ||||||||||||
ASU 2014-09 | Previously Reported | Airport customer service and other | ||||||||||||||
Income Statement: | ||||||||||||||
Total operating revenues | 77,560 | 69,792 | ||||||||||||
ASU 2014-09 | Previously Reported | Aircraft fuel | ||||||||||||||
Income Statement: | ||||||||||||||
Total operating expenses | 162,653 | 122,284 | ||||||||||||
ASU 2014-09 | Previously Reported | Airport related expenses | ||||||||||||||
Income Statement: | ||||||||||||||
Total operating expenses | 69,848 | 72,659 | ||||||||||||
ASU 2014-09 | Adjustments | ||||||||||||||
Income Statement: | ||||||||||||||
Total operating revenues | (81,676) | (57,504) | ||||||||||||
Salaries, wages and benefits | (4,160) | (5,921) | ||||||||||||
Other operating expenses | (48,525) | (49,482) | ||||||||||||
Total operating expenses | (81,676) | (57,504) | ||||||||||||
ASSETS | ||||||||||||||
Other long-term assets | 16,121 | 16,121 | ||||||||||||
LIABILITIES: | ||||||||||||||
Other long-term liabilities | $ 16,121 | 16,121 | ||||||||||||
ASU 2014-09 | Adjustments | Flying agreements | ||||||||||||||
Income Statement: | ||||||||||||||
Total operating revenues | (48,411) | (40,676) | ||||||||||||
ASU 2014-09 | Adjustments | Airport customer service and other | ||||||||||||||
Income Statement: | ||||||||||||||
Total operating revenues | (33,265) | (16,828) | ||||||||||||
ASU 2014-09 | Adjustments | Aircraft fuel | ||||||||||||||
Income Statement: | ||||||||||||||
Total operating expenses | (77,517) | (51,583) | ||||||||||||
ASU 2014-09 | Adjustments | Airport related expenses | ||||||||||||||
Income Statement: | ||||||||||||||
Total operating expenses | $ 48,526 | $ 49,482 | ||||||||||||
[1] | Amounts adjusted due to the adoption of Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606). See Note 1 to the financial statements of this report for additional information. |
Segment Reporting (Details)
Segment Reporting (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||
Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2018USD ($)segmentaircraft | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | ||||
Segment Reporting | ||||||||||||||
Number of operating segments | segment | 3 | |||||||||||||
Operating revenues | $ 803,489 | $ 829,275 | $ 805,515 | $ 783,400 | $ 771,241 | $ 812,673 | $ 791,512 | $ 747,166 | $ 3,221,679 | $ 3,122,592 | [1] | $ 3,063,702 | [1] | |
Operating expense | 2,747,399 | 2,734,393 | [1] | 3,236,386 | [1] | |||||||||
Depreciation and amortization expense | 334,589 | 292,768 | [1] | 284,969 | [1] | |||||||||
Special items | [1] | 465,649 | ||||||||||||
Interest expense | 120,409 | 104,925 | [1] | 78,177 | [1] | |||||||||
Segment profit (loss) | 353,871 | 283,274 | (250,861) | |||||||||||
Identifiable intangible assets, other than goodwill | 4,896 | 4,896 | 8,249 | |||||||||||
Total assets | 6,313,212 | 5,474,400 | 6,313,212 | 5,474,400 | 5,007,966 | |||||||||
Capital expenditures (including non-cash) | $ 1,156,276 | 689,398 | 1,159,001 | |||||||||||
CRJ 200 | ||||||||||||||
Segment Reporting | ||||||||||||||
Number of aircraft leased to third party | aircraft | 4 | |||||||||||||
Special items | 424,466 | |||||||||||||
SkyWest Airlines | ||||||||||||||
Segment Reporting | ||||||||||||||
Operating revenues | $ 2,346,251 | 2,092,368 | 1,878,725 | |||||||||||
Operating expense | 2,022,560 | 1,807,540 | 1,829,520 | |||||||||||
Depreciation and amortization expense | 155,511 | 134,563 | 139,159 | |||||||||||
Special items | 184,295 | |||||||||||||
Interest expense | 17,021 | 21,544 | 26,211 | |||||||||||
Segment profit (loss) | 306,670 | 263,284 | 22,994 | |||||||||||
Total assets | 2,531,707 | 2,245,051 | 2,531,707 | 2,245,051 | 2,250,276 | |||||||||
Capital expenditures (including non-cash) | 149,731 | 124,955 | 57,761 | |||||||||||
SkyWest Airlines | CRJ 200 | ||||||||||||||
Segment Reporting | ||||||||||||||
Special items | 184,300 | |||||||||||||
ExpressJet Airlines Inc | ||||||||||||||
Segment Reporting | ||||||||||||||
Operating revenues | 564,202 | 790,282 | 1,043,977 | |||||||||||
Operating expense | 577,608 | 818,683 | 1,338,718 | |||||||||||
Depreciation and amortization expense | 37,290 | 51,982 | 83,935 | |||||||||||
Special items | 281,354 | |||||||||||||
Interest expense | 2,340 | 4,127 | 6,773 | |||||||||||
Segment profit (loss) | (15,746) | (32,528) | (301,514) | |||||||||||
Identifiable intangible assets, other than goodwill | 4,896 | 4,896 | 8,249 | |||||||||||
Total assets | 279,303 | 599,122 | 279,303 | 599,122 | 582,890 | |||||||||
Capital expenditures (including non-cash) | 10,137 | 14,278 | 15,396 | |||||||||||
ExpressJet Airlines Inc | CRJ 200 | ||||||||||||||
Segment Reporting | ||||||||||||||
Special items | 240,200 | |||||||||||||
SkyWest Leasing | ||||||||||||||
Segment Reporting | ||||||||||||||
Operating revenues | 311,226 | 239,942 | 141,000 | |||||||||||
Operating expense | 147,231 | 108,170 | 68,148 | |||||||||||
Depreciation and amortization expense | 141,788 | 106,223 | 61,875 | |||||||||||
Interest expense | 101,048 | 79,254 | 45,193 | |||||||||||
Segment profit (loss) | 62,947 | 52,518 | 27,659 | |||||||||||
Total assets | $ 3,502,202 | $ 2,630,227 | 3,502,202 | 2,630,227 | 2,174,800 | |||||||||
Capital expenditures (including non-cash) | $ 996,408 | $ 550,165 | $ 1,085,844 | |||||||||||
[1] | Amounts adjusted due to the adoption of Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606). See Note 1 to the financial statements of this report for additional information. |
Long-term Debt (Details)
Long-term Debt (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018USD ($)aircraft | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Debt Instrument [Line Items] | |||
Total long-term debt | $ 3,185,438 | $ 2,712,350 | |
Current portion of long-term debt | (354,072) | (313,243) | |
Less long-term portion of unamortized debt issue cost, net | (21,598) | (21,761) | |
Long-term debt, net of current maturities and debt issue costs | 2,809,768 | 2,377,346 | |
Current portion of long-term debt | 354,072 | 313,243 | |
Long-term debt, net of current maturities | 354,072 | 313,243 | |
Less current portion of unamortized debt issue cost, net | (3,866) | (3,565) | |
Current portion of long-term debt, net of debt issue costs | $ 350,206 | $ 309,678 | |
Effective interest rate (as a percent) | 4.20% | 3.90% | |
Aggregate amounts of principal maturities of long-term debt | |||
2,019 | $ 354,072 | ||
2,020 | 351,738 | ||
2,021 | 347,835 | ||
2,022 | 353,935 | ||
2,023 | 359,677 | ||
Thereafter | 1,418,181 | ||
Repayment of debt in cash | 43,500 | $ 16,500 | |
Total repayment of debt | 43,500 | 18,400 | |
Pre-tax gain | $ 1,279 | ||
Letters of credit | 9,700 | 14,800 | |
Current borrowing capacity | 65,300 | 60,200 | |
Letters of credit and surety bonds outstanding with various banks and surety institutions | $ 78,700 | 87,400 | |
E 175 | |||
Debt Instrument [Line Items] | |||
Number of new aircraft acquired | aircraft | 39 | ||
Purchase price portion financed through debt issuance (as a percent) | 85.00% | ||
Purchase price portion paid with cash (as a percent) | 15.00% | ||
Notes payable to banks, due in semi-annual installments, variable interest based on LIBOR, or with an interest rate of 4.00% through 2019, secured by aircraft | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 4.00% | ||
Total long-term debt | $ 6,429 | 34,905 | |
Notes payable to a financing company, due in semi-annual installments, variable interest based on LIBOR, or with an interest rate of 3.25% through 2021, secured by aircraft | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 3.25% | ||
Total long-term debt | $ 36,324 | 97,612 | |
Notes payable to banks, due in semi-annual installments plus interest at 6.10% to 6.51% through 2021, secured by aircraft | |||
Debt Instrument [Line Items] | |||
Total long-term debt | $ 41,592 | 63,090 | |
Notes payable to banks, due in semi-annual installments plus interest at 6.10% to 6.51% through 2021, secured by aircraft | Minimum | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 6.10% | ||
Notes payable to banks, due in semi-annual installments plus interest at 6.10% to 6.51% through 2021, secured by aircraft | Maximum | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 6.51% | ||
Notes payable to banks, due in monthly installments plus interest of 2.68% to 6.86% through 2025, secured by aircraft | |||
Debt Instrument [Line Items] | |||
Total long-term debt | $ 371,300 | 372,157 | |
Notes payable to banks, due in monthly installments plus interest of 2.68% to 6.86% through 2025, secured by aircraft | Minimum | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 2.68% | ||
Notes payable to banks, due in monthly installments plus interest of 2.68% to 6.86% through 2025, secured by aircraft | Maximum | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 6.86% | ||
Notes payable to banks, due in monthly installments, plus interest at 4.07% to 6.05% through 2029, secured by aircraft | |||
Debt Instrument [Line Items] | |||
Total long-term debt | $ 105,069 | 49,001 | |
Notes payable to banks, due in monthly installments, plus interest at 4.07% to 6.05% through 2029, secured by aircraft | Minimum | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 4.07% | ||
Notes payable to banks, due in monthly installments, plus interest at 4.07% to 6.05% through 2029, secured by aircraft | Maximum | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 6.05% | ||
Notes payable to banks, due in quarterly installments, plus interest at 3.39% to 5.08% through 2030, secured by aircraft | |||
Debt Instrument [Line Items] | |||
Total long-term debt | $ 2,621,416 | 2,085,822 | |
Notes payable to banks, due in quarterly installments, plus interest at 3.39% to 5.08% through 2030, secured by aircraft | Minimum | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 3.39% | ||
Notes payable to banks, due in quarterly installments, plus interest at 3.39% to 5.08% through 2030, secured by aircraft | Maximum | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 5.08% | ||
Notes payable to banks due in monthly installments, interest based on LIBOR interest at 3.30% through 2019, secured by spare engines | |||
Debt Instrument [Line Items] | |||
Interest rate (as a percent) | 3.30% | ||
Total long-term debt | $ 3,308 | 9,763 | |
Line of credit | |||
Aggregate amounts of principal maturities of long-term debt | |||
Maximum borrowing capacity | 75,000 | 75,000 | |
Amount outstanding | $ 0 | $ 0 | |
LIBOR | Line of credit | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 2.50% |
Income Taxes - Provision (Detai
Income Taxes - Provision (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
Current tax provision (benefit): | |||||
Federal | $ (21,598) | $ 5,853 | $ (3,801) | ||
State | 1,465 | 180 | 111 | ||
Foreign | 1,575 | ||||
Total current tax provision (benefit) | (18,558) | 6,033 | (3,690) | ||
Deferred tax provision (benefit): | |||||
Federal | 92,250 | (166,890) | (77,430) | ||
State | 12,250 | 20,133 | (6,106) | ||
Total deferred tax provision (benefit) | 104,500 | (146,757) | (83,536) | ||
Provision (benefit) for income taxes | $ 85,942 | $ (140,724) | [1] | $ (87,226) | [1] |
[1] | Amounts adjusted due to the adoption of Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606). See Note 1 to the financial statements of this report for additional information. |
Income Taxes - Reconciliation (
Income Taxes - Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
Statutory Federal income tax rate (as a percent) | 21.00% | 35.00% | 35.00% | ||
Reconciliation | |||||
Computed provision (benefit) for income taxes at the statutory rate | $ 76,926 | $ 100,864 | $ (87,084) | ||
State income tax provision (benefit), net of federal income tax benefit | 12,711 | 7,778 | (5,768) | ||
Non-deductible expenses | 1,956 | 3,230 | 3,552 | ||
Valuation allowance changes affecting the provision for income taxes | (1,187) | 505 | 751 | ||
Foreign income taxes, net of federal & state benefit | 1,192 | ||||
Excess tax benefits from share based compensation | (4,548) | (5,377) | |||
Revaluation of net deferred tax liabilities for the Tax Act | (246,845) | ||||
Other, net | (1,108) | (879) | 1,323 | ||
Provision (benefit) for income taxes | 85,942 | (140,724) | [1] | (87,226) | [1] |
Unrecorded tax benefits | 14,553 | 2,223 | |||
Deferred tax assets: | |||||
Accrued benefits | 32,462 | 31,651 | |||
Net operating loss carryforward | 344,375 | 122,648 | |||
AMT credit carryforward | 15,744 | 23,443 | |||
Aircraft credits | 35,924 | 53,870 | |||
Accrued reserves and other | 18,710 | 26,647 | |||
Total deferred tax assets | 447,215 | 258,259 | |||
Valuation allowance | (9,455) | (10,642) | |||
Deferred tax liabilities: | |||||
Accelerated depreciation | (955,919) | (666,637) | |||
Total deferred tax liabilities | (955,919) | (666,637) | |||
Net deferred tax liability | (518,159) | (419,020) | |||
Accounting Standards Update 2016-09 | |||||
Reconciliation | |||||
Benefit from share-based compensation | 4,500 | 5,400 | |||
ExpressJet | State | |||||
Reconciliation | |||||
Valuation allowance | $ 1,200 | $ 500 | $ 800 | ||
[1] | Amounts adjusted due to the adoption of Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606). See Note 1 to the financial statements of this report for additional information. |
Income Taxes - Net Operating Lo
Income Taxes - Net Operating Losses and Tax Rates (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Net operating losses | |||
Statutory Federal income tax rate (as a percent) | 21.00% | 35.00% | 35.00% |
Alternative minimum tax credits | $ 15,744 | $ 23,443 | |
Tax credit recovery period | 3 years | ||
Federal | |||
Net operating losses | |||
Operating loss carryforward | $ 1,504,900 | 491,400 | |
Estimated effective tax rate on net operating losses | 21.00% | ||
State | |||
Net operating losses | |||
Operating loss carryforward | $ 562,000 | $ 302,500 | |
Estimated effective tax rate on net operating losses | 3.36% |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Income Taxes | |
Unrecognized tax benefits at the beginning of year | $ 2,223 |
Gross increases - current year tax positions | 13,899 |
Gross increases - prior year tax positions | |
Gross decreases - prior year tax positions | (1,569) |
Unrecognized tax benefits at end of year | 14,553 |
Interest and penalties in year-end balance |
Commitments and Contingencies_2
Commitments and Contingencies (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018USD ($)aircraft | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | |
Future minimum rental payments required under operating leases | |||
2,019 | $ 87,256 | ||
2,020 | 101,741 | ||
2,021 | 90,787 | ||
2,022 | 72,593 | ||
2,023 | 65,749 | ||
Thereafter | 59,820 | ||
Total future lease obligations | $ 477,946 | ||
Number of aircraft leased | aircraft | 260 | ||
Total rental expense for non-cancelable aircraft operating leases | $ 154,900 | $ 215,800 | $ 262,600 |
Minimum rental expense for airport station rents | $ 19,600 | $ 30,300 | $ 31,400 |
Commitments and Contingencies -
Commitments and Contingencies - Concentration Risks and Employees Under Collective Bargaining Agreements (Details) | 12 Months Ended | ||
Dec. 31, 2018USD ($)employee | Dec. 31, 2017USD ($) | Dec. 31, 2016 | |
Concentration Risk and Significant Customers | |||
Allowance for doubtful accounts | $ | $ 158,000 | $ 157,000 | |
Revenue from rights, concentration risk | Customer concentration risk | Delta, United, and Continental Combined | |||
Concentration Risk and Significant Customers | |||
Concentration risk (as a percent) | 81.40% | 82.90% | 88.70% |
Full-time equivalent number of employees | Labor force concentration risk | |||
Concentration Risk and Significant Customers | |||
Number of employees | 15,900 | ||
Full-time equivalent number of employees | ExpressJet | Unionized employees | |||
Concentration Risk and Significant Customers | |||
Number of full-time equivalent employees | 2,932 | ||
Approximate number of active employees | 2,320 | ||
SkyWest Airlines | Full-time equivalent number of employees | Unionized employees | |||
Concentration Risk and Significant Customers | |||
Approximate number of active employees | 0 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Dec. 31, 2018 | Dec. 31, 2017 |
Fair Value Measurements | ||
Marketable securities | $ 360,945 | $ 503,503 |
Total Assets Measured at Fair Value | 689,372 | 685,523 |
Fair Value of Financial Instruments | ||
Fair value of long-term debt | 3,157,300 | 2,698,400 |
Recurring | Fair value | ||
Fair Value Measurements | ||
Marketable securities | 360,945 | 503,503 |
Cash, Cash Equivalents and Restricted Cash | 328,384 | 181,792 |
Total Assets Measured at Fair Value | 689,329 | 685,295 |
Recurring | Fair value | Bonds and bond funds | ||
Fair Value Measurements | ||
Marketable securities | 229,783 | 344,251 |
Recurring | Fair value | Commercial paper | ||
Fair Value Measurements | ||
Marketable securities | 131,162 | 159,252 |
Recurring | Level 1 | ||
Fair Value Measurements | ||
Cash, Cash Equivalents and Restricted Cash | 328,384 | 181,792 |
Total Assets Measured at Fair Value | 328,384 | 181,792 |
Recurring | Level 2 | ||
Fair Value Measurements | ||
Marketable securities | 360,945 | 503,503 |
Total Assets Measured at Fair Value | 360,945 | 503,503 |
Recurring | Level 2 | Bonds and bond funds | ||
Fair Value Measurements | ||
Marketable securities | 229,783 | 344,251 |
Recurring | Level 2 | Commercial paper | ||
Fair Value Measurements | ||
Marketable securities | $ 131,162 | $ 159,252 |
Special Items (Details)
Special Items (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016USD ($) | ||
Total Special items | $ 465,649 | [1] |
Proceeds from settlement of residual value guarantee aircraft agreements | 90,000 | |
CRJ 200 | ||
Total Special items | 424,466 | |
ERJ 145 | ||
Total Special items | 41,183 | |
Estimated fair value | 41,200 | |
SkyWest Airlines | ||
Total Special items | 184,295 | |
Proceeds from settlement of residual value guarantee aircraft agreements | 90,000 | |
SkyWest Airlines | CRJ 200 | ||
Total Special items | 184,300 | |
ExpressJet Airlines Inc | ||
Total Special items | 281,354 | |
ExpressJet Airlines Inc | CRJ 200 | ||
Total Special items | $ 240,200 | |
[1] | Amounts adjusted due to the adoption of Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606). See Note 1 to the financial statements of this report for additional information. |
Capital Transactions - Preferre
Capital Transactions - Preferred Stock (Details) - shares | Dec. 31, 2018 | Dec. 31, 2017 |
Preferred Stock | ||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock outstanding (in shares) | 0 |
Capital Transactions - Stock Co
Capital Transactions - Stock Compensation (Details) | May 04, 2010shares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | Dec. 31, 2016USD ($)installment$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares |
Assumptions used to determine value of the shares purchased under the stock purchase plan using Black-Scholes option pricing model | ||||||
Performance period | 90 days | |||||
Compensation expenses | ||||||
Stock based compensation expense | $ | $ 13,105,000 | $ 10,580,000 | $ 7,568,000 | |||
Director | ||||||
Assumptions used to determine value of the shares purchased under the stock purchase plan using Black-Scholes option pricing model | ||||||
Granted (in shares) | 15,165 | 22,617 | ||||
Granted (in dollars per share) | $ / shares | $ 53.40 | $ 35.81 | $ 14.78 | |||
Number of shares | ||||||
Granted (in shares) | 15,165 | 22,617 | ||||
Weighted Average Grant-Date Fair Value | ||||||
Granted (in dollars per share) | $ / shares | $ 53.40 | $ 35.81 | $ 14.78 | |||
Number of Options | ||||||
Granted (in shares) | 42,624 | |||||
Non-vested stock options | ||||||
Granted (in shares) | 42,624 | |||||
Stock options and restricted stock | ||||||
Compensation expenses | ||||||
Total unrecognized compensation cost | $ | $ 12,700,000 | |||||
Unrecognized compensation cost recognized over a weighted average period (in years) | 1 year 8 months 12 days | |||||
Employee stock options | ||||||
Share-Based Compensation | ||||||
Options outstanding (in shares) | 458,103 | 819,981 | 1,064,429 | 300,580 | 458,103 | |
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) | 1.08% | |||||
Risk-free interest rate (as a percent) | 1.15% | |||||
Average expected life (years) | 5 years 8 months 12 days | |||||
Expected volatility of common stock (as a percent) | 0.412% | |||||
Forfeiture rate (as a percent) | 0.00% | |||||
Weighted average fair value of option grants | $ / shares | $ 5.27 | |||||
Compensation expenses | ||||||
Period from grant date after which stock options become exercisable, minimum (in months) | 6 months | |||||
Period from grant date within which incentive stock options are exercisable, maximum (in years) | 7 years | |||||
Number of Options | ||||||
Outstanding at the beginning of the period (in shares) | 458,103 | 819,981 | 1,064,429 | |||
Granted (in shares) | 206,021 | |||||
Exercised (in shares) | (157,523) | (356,209) | (351,296) | |||
Cancelled (in shares) | (5,669) | (99,173) | ||||
Outstanding at the end of the period (in shares) | 300,580 | 458,103 | 819,981 | |||
Exercisable (in shares) | 235,672 | 254,192 | ||||
Weighted Average Exercise Price | ||||||
Outstanding at the beginning of the period (in dollars per share) | $ / shares | $ 13.73 | $ 13.58 | $ 13.64 | |||
Granted (in dollars per share) | $ / shares | 14.90 | |||||
Exercised (in dollars per share) | $ / shares | 13.80 | 13.36 | 14.17 | |||
Cancelled (in dollars per share) | $ / shares | 14.33 | 14.90 | ||||
Outstanding at the end of the period (in dollars per share) | $ / shares | $ 13.70 | $ 13.73 | $ 13.58 | |||
Exercisable (in dollars per share) | $ / shares | $ 13.36 | $ 13.17 | ||||
Weighted Average Remaining Contractual Term | ||||||
Outstanding, Weighted Average Remaining Contractual Term (in years) | 3 years | 4 years | ||||
Exercisable, Weighted Average Remaining Contractual Term (in years) | 2 years 8 months 12 days | 3 years 4 months 24 days | ||||
Aggregate Intrinsic Value | ||||||
Average intrinsic value of shares outstanding | $ | $ 9,249,400 | $ 18,034,100 | ||||
Average intrinsic value of shares exercisable | $ | $ 7,330,700 | $ 10,150,800 | ||||
Total intrinsic value of options exercised | $ | $ 7,100,000 | $ 9,940,000 | $ 4,250,000 | |||
Non-vested stock options | ||||||
Non-vested shares at beginning of year (in shares) | 203,911 | |||||
Granted (in shares) | 206,021 | |||||
Vested (in shares) | (139,003) | |||||
Non-vested shares at end of year (in shares) | 64,908 | 203,911 | ||||
Weighted Average Grant-Date Fair Value | ||||||
Non-vested shares at beginning of year (in dollars per share) | $ / shares | $ 5.17 | |||||
Granted (in dollars per share) | $ / shares | $ 5.27 | |||||
Vested (in dollars per share) | $ / shares | 5.10 | |||||
Non-vested shares at end of year (in dollars per share) | $ / shares | $ 5.32 | $ 5.17 | ||||
Performance 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) | 90,264 | 119,315 | 183,577 | |||
Granted (in dollars per share) | $ / shares | $ 53.41 | $ 35.81 | $ 14.89 | |||
Performance period | 3 years | |||||
Number of shares | ||||||
Nonvested sharess at the beginning of the period (in shares) | 468,576 | 363,993 | 202,829 | |||
Granted (in shares) | 90,264 | 119,315 | 183,577 | |||
Additional shares awarded from the 2015 grant | 92,335 | |||||
Vested (in shares) | (277,029) | |||||
Cancelled (in shares) | (3,229) | (14,732) | (22,413) | |||
Nonvested shares at the end of the period (in shares) | 370,917 | 468,576 | 363,993 | |||
Weighted Average Grant-Date Fair Value | ||||||
Nonvested shares at the beginning of the period (in dollars per share) | $ / shares | $ 19.70 | $ 14.23 | $ 13.62 | |||
Granted (in dollars per share) | $ / shares | 53.41 | 35.81 | 14.89 | |||
Additional shares awarded from the 2015 grant (in dollars per share) | $ / shares | 13.62 | |||||
Vested (in dollars per share) | $ / shares | 13.62 | |||||
Cancelled (in dollars per share) | $ / shares | 30.09 | 15 | 14.16 | |||
Nonvested shares at the end of the period (in dollars per share) | $ / shares | $ 30.84 | $ 19.70 | $ 14.23 | |||
Performance stock units | Maximum | ||||||
Assumptions used to determine value of the shares purchased under the stock purchase plan using Black-Scholes option pricing model | ||||||
Award percentage | 200.00% | 200.00% | 150.00% | |||
Performance stock units | Minimum | ||||||
Assumptions used to determine value of the shares purchased under the stock purchase plan using Black-Scholes option pricing model | ||||||
Award percentage | 0.00% | 0.00% | 0.00% | |||
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) | 115,044 | 160,137 | 384,148 | |||
Granted (in dollars per share) | $ / shares | $ 53.40 | $ 35.81 | $ 14.81 | |||
Number of shares | ||||||
Nonvested sharess at the beginning of the period (in shares) | 815,590 | 926,931 | 809,299 | |||
Granted (in shares) | 115,044 | 160,137 | 384,148 | |||
Vested (in shares) | (330,580) | (230,903) | (215,146) | |||
Cancelled (in shares) | (24,273) | (40,575) | (51,370) | |||
Nonvested shares at the end of the period (in shares) | 575,781 | 815,590 | 926,931 | |||
Weighted Average Grant-Date Fair Value | ||||||
Nonvested shares at the beginning of the period (in dollars per share) | $ / shares | $ 18.35 | $ 13.65 | $ 13.13 | |||
Granted (in dollars per share) | $ / shares | 53.40 | 35.81 | 14.81 | |||
Vested (in dollars per share) | $ / shares | 13.57 | 12.01 | 13.29 | |||
Cancelled (in dollars per share) | $ / shares | 27.77 | 15.78 | 13.72 | |||
Nonvested shares at the end of the period (in dollars per share) | $ / shares | $ 27.71 | $ 18.35 | $ 13.65 | |||
Long Term Incentive Plan 2010 | ||||||
Share-Based Compensation | ||||||
Number of shares authorized | 5,150,000 | |||||
Shares remaining available for future issuance | 2,000,000 | |||||
Long Term Incentive Plan 2010 | Employee stock options | ||||||
Share-Based Compensation | ||||||
Minimum incentive stock option exercise price, expressed as a percentage of common stock grant date market value | 100.00% | |||||
Assumptions used to determine value of the shares purchased under the stock purchase plan using Black-Scholes option pricing model | ||||||
Number of equal installments to vest | installment | 3 | |||||
Vesting period | 3 years | |||||
Number of Options | ||||||
Granted (in shares) | 206,021 | |||||
Non-vested stock options | ||||||
Granted (in shares) | 206,021 | |||||
Long Term Incentive Plan 2010 | Restricted stock units | ||||||
Assumptions used to determine value of the shares purchased under the stock purchase plan using Black-Scholes option pricing model | ||||||
Vesting period | 3 years | |||||
Granted (in dollars per share) | $ / shares | $ 53.40 | |||||
Weighted Average Grant-Date Fair Value | ||||||
Granted (in dollars per share) | $ / shares | $ 53.40 | |||||
Long Term Incentive Plan 2010 | Restricted stock units | Director | ||||||
Assumptions used to determine value of the shares purchased under the stock purchase plan using Black-Scholes option pricing model | ||||||
Granted (in shares) | 115,044 | |||||
Number of shares | ||||||
Granted (in shares) | 115,044 |
Capital Transactions - Informat
Capital Transactions - Information About Stock Options Outstanding (Details) - Employee stock options | 12 Months Ended |
Dec. 31, 2018$ / sharesshares | |
$12.00 to $13.99 | |
Stock options, exercise price | |
Exercise price range, low end of range (in dollars per share) | $ 12 |
Exercise price range, high end of range (in dollars per share) | $ 13.99 |
Options Outstanding | |
Number of options outstanding (in shares) | shares | 193,231 |
Options outstanding, Weighted Average Remaining Contractual Life | 2 years 4 months 24 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 13.04 |
Options Exercisable | |
Number of options Exercisable (in shares) | shares | 193,231 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 13.04 |
$14.00 to $15.99 | |
Stock options, exercise price | |
Exercise price range, low end of range (in dollars per share) | 14 |
Exercise price range, high end of range (in dollars per share) | $ 15.99 |
Options Outstanding | |
Number of options outstanding (in shares) | shares | 104,159 |
Options outstanding, Weighted Average Remaining Contractual Life | 4 years 1 month 6 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 14.78 |
Options Exercisable | |
Number of options Exercisable (in shares) | shares | 41,292 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 14.78 |
$16.00 to $19.00 | |
Stock options, exercise price | |
Exercise price range, low end of range (in dollars per share) | 16 |
Exercise price range, high end of range (in dollars per share) | $ 19 |
Options Outstanding | |
Number of options outstanding (in shares) | shares | 3,190 |
Options outstanding, Weighted Average Remaining Contractual Life | 3 years 9 months 18 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 18.31 |
Options Exercisable | |
Number of options Exercisable (in shares) | shares | 1,149 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 17.25 |
$12.00 to $19.00 | |
Stock options, exercise price | |
Exercise price range, low end of range (in dollars per share) | 12 |
Exercise price range, high end of range (in dollars per share) | $ 19 |
Options Outstanding | |
Number of options outstanding (in shares) | shares | 300,580 |
Options outstanding, Weighted Average Remaining Contractual Life | 3 years |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 13.70 |
Options Exercisable | |
Number of options Exercisable (in shares) | shares | 235,672 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 13.36 |
Retirement Plans and Employee_3
Retirement Plans and Employee Stock Purchase Plans - Retirement Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
SkyWest Plan | |||
Retirement Plans | |||
Service period required to be completed to be eligible to participate in plan | 90 days | ||
Required age for an employee to be eligible to participate in plan | 18 years | ||
Percentage of employer matching contribution based on length of service | 100.00% | ||
Minimum benefit plan percentage of participants compensation eligible for employer matching contribution based on position and years of service | 2.00% | ||
Maximum benefit plan percentage of participants compensation eligible for employer matching contribution based on position and years of service | 12.00% | ||
Company's combined contributions | $ 35.6 | $ 26.1 | $ 23.2 |
Atlantic Southeast and the ExpressJet Plans | |||
Retirement Plans | |||
Service period required to be completed to be eligible to participate in plan | 90 days | ||
Required age for an employee to be eligible to participate in plan | 18 years | ||
Company's combined contributions | $ 15.4 | $ 17.8 | $ 21 |
Maximum percentage of participant's total compensation eligible for employer matching contribution | 6.00% | ||
Atlantic Southeast Plan | |||
Retirement Plans | |||
Percentage of vesting for plan participants' elective deferrals and rollover amounts | 100.00% |
Retirement Plans and Employee_4
Retirement Plans and Employee Stock Purchase Plans - Employee Stock Purchase Plans (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Employee Stock Purchase Plans | |||
Service period required to be completed for an employee to be eligible to participate in plan, minimum | 90 days | ||
Ownership interest in Company common stock to disqualify employee from participation in plan, maximum (as a percent) | 5.00% | ||
Maximum percentage of base salary which can be contributed by the employees | 15.00% | ||
Maximum amount of base salary which can be contributed annually by the employees | $ 25,000 | ||
Discount rate at which common stock can be purchased by the plan participant (as a percent) | 5.00% | ||
Summary of purchases made under the 2010 and 1995 Employee Stock Purchase Plans | |||
Number of shares purchased | 60,950 | 88,362 | 151,531 |
Average price of shares purchased (in dollars per share) | $ 49.85 | $ 33.96 | $ 20.87 |
2009 Stock Purchase Plan | |||
Summary of purchases made under the 2010 and 1995 Employee Stock Purchase Plans | |||
Stock based compensation expense | $ 0 | $ 0 | $ 0 |
Stock Repurchase (Details)
Stock Repurchase (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 1 Months Ended | 12 Months Ended | ||
Jan. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Stock Repurchase | ||||
Common stock authorized for repurchase, maximum (in shares) | 100 | |||
Stock repurchase program year | 3 years | |||
Common stock remaining number of shares authorized to repurchase | 25.5 | |||
Common stock repurchased (in shares) | 1 | 0.5 | 0 | |
Common stock repurchased, value | $ 54.4 | $ 20 | ||
Weighted average price per share of common stock (in dollars per share) | $ 56.25 | $ 41.36 | ||
Payment of income tax obligation on employee equity awards | $ 13.6 | $ 5.1 |
Related-Party Transactions (Det
Related-Party Transactions (Details) | 12 Months Ended |
Dec. 31, 2018USD ($) | |
Affiliated entity | |
Related Party Transactions | |
Purchase from related party | $ 206,000 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Thousands | Feb. 20, 2019USD ($)aircraft | Jan. 22, 2019USD ($)aircraft | Jan. 11, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Feb. 28, 2019USD ($) |
Subsequent Event [Line Items] | |||||||
Cash payment | $ 1,062,380 | $ 661,176 | $ 1,138,963 | ||||
Authorized repurchase amount | $ 250,000 | ||||||
Subsequent event | Early Lease Buyout Agreement | |||||||
Subsequent Event [Line Items] | |||||||
Cash payment | $ 111,700 | ||||||
Subsequent event | ExpressJet | Asset Purchase Agreement | |||||||
Subsequent Event [Line Items] | |||||||
Proceeds from sale of equipment | $ 60,000 | ||||||
Subsequent event | ExpressJet | Stock Purchase Agreement | |||||||
Subsequent Event [Line Items] | |||||||
Cash received from stock sale | $ 16,000 | ||||||
Amount loaned to Kair Enterprises, Inc | $ 26,000 | ||||||
Lease term (in years) | 5 years | ||||||
CRJ 700 | Subsequent event | Early Lease Buyout Agreement | |||||||
Subsequent Event [Line Items] | |||||||
Number of aircraft in early lease buyout | aircraft | 16 | ||||||
CRJ 200 | Subsequent event | Early Lease Buyout Agreement | |||||||
Subsequent Event [Line Items] | |||||||
Number of aircraft in early lease buyout | aircraft | 36 | ||||||
CRJ 200 | Subsequent event | ExpressJet | Stock Purchase Agreement | |||||||
Subsequent Event [Line Items] | |||||||
Number of aircraft agreed to lease | aircraft | 16 |
Quarterly Financial Data (Una_3
Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | [1] | ||
Quarterly Financial Data (Unaudited) | |||||||||||||
Operating revenues | $ 803,489 | $ 829,275 | $ 805,515 | $ 783,400 | $ 771,241 | $ 812,673 | $ 791,512 | $ 747,166 | $ 3,221,679 | $ 3,122,592 | [1] | $ 3,063,702 | |
Operating income | 121,502 | 137,925 | 126,678 | 88,175 | 92,939 | 112,369 | 106,596 | 76,295 | 474,280 | 388,199 | [1] | (172,684) | |
Net income | $ 67,105 | $ 83,046 | $ 75,859 | $ 54,362 | $ 289,928 | $ 53,716 | $ 50,477 | $ 34,786 | $ 280,372 | $ 428,907 | [1] | $ (161,586) | |
Net income per common share: | |||||||||||||
Basic (in dollars per share) | $ 1.30 | $ 1.60 | $ 1.46 | $ 1.05 | $ 5.60 | $ 1.04 | $ 0.98 | $ 0.67 | $ 5.40 | $ 8.28 | [1] | $ (3.14) | |
Diluted (in dollars per share) | $ 1.28 | $ 1.57 | $ 1.43 | $ 1.03 | $ 5.46 | $ 1.01 | $ 0.95 | $ 0.65 | $ 5.30 | $ 8.08 | [1] | $ (3.14) | |
Weighted average common shares: | |||||||||||||
Basic (in shares) | 51,650 | 52,039 | 52,046 | 51,921 | 51,811 | 51,833 | 51,751 | 51,820 | 51,914 | 51,804 | [1] | 51,505 | |
Diluted (in shares) | 52,556 | 52,981 | 52,913 | 53,033 | 53,140 | 53,080 | 52,977 | 53,202 | 52,871 | 53,100 | [1] | 51,505 | |
Revaluation of deferred tax liability | $ 246,800 | ||||||||||||
[1] | Amounts adjusted due to the adoption of Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606). See Note 1 to the financial statements of this report for additional information. |
SCHEDULE II _VALUATION AND QUAL
SCHEDULE II —VALUATION AND QUALIFYING ACCOUNTS (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($)item | |
VALUATION AND QUALIFYING ACCOUNTS | |||
Balance at Beginning of Year | $ 17,255 | $ 40,670 | $ 14,120 |
Additions Charged to Costs and Expenses | 5,044 | 26,564 | |
Deductions | (23,415) | (14) | |
Balance at End of Year | 22,299 | 17,255 | $ 40,670 |
Number of seats on aircraft | item | 50 | ||
Allowance for inventory obsolescence | |||
VALUATION AND QUALIFYING ACCOUNTS | |||
Balance at Beginning of Year | 17,098 | 40,497 | $ 13,933 |
Additions Charged to Costs and Expenses | 5,043 | 26,564 | |
Deductions | (23,399) | ||
Balance at End of Year | 22,141 | 17,098 | 40,497 |
Allowance for doubtful accounts receivable | |||
VALUATION AND QUALIFYING ACCOUNTS | |||
Balance at Beginning of Year | 157 | 173 | 187 |
Additions Charged to Costs and Expenses | 1 | ||
Deductions | (16) | (14) | |
Balance at End of Year | $ 158 | $ 157 | $ 173 |