Pinnacle Airlines Corp. Reports Second Quarter 2008 Financial Results
Posted on: Monday, 11 August 2008, 09:01 CDT
Pinnacle Airlines Corp. (NASDAQ: PNCL) (the "Company") today reported a second quarter 2008 fully diluted loss per share of $(0.64). Excluding certain special charges discussed below, the Company reported fully diluted earnings per share ("EPS") and net income of $0.30 and $5.4 million, respectively, for the second quarter of 2008. The Company's EPS and net income excluding special charges were $0.43 and $10.3 million, respectively, for the second quarter of 2007.
Significant events at Pinnacle Airlines, Inc. ("Pinnacle"), the Company's regional jet operating subsidiary, and Colgan Air, Inc. ("Colgan"), the Company's regional turboprop operating subsidiary, include the following:
Recent Significant Events
-- Colgan took delivery of seven Q400 aircraft during the second quarter, increasing the total in operation under its capacity purchase agreement with Continental Airlines to 13 as of June 30. The remaining two Q400 aircraft to be operated as a Continental Connection carrier were delivered in July. In addition, Colgan reached agreement with Bombardier, the aircraft manufacturer, to convert the 30 firm cancelable/optional aircraft it has on order into the Q400 next generation cabin configuration. The next generation cabin configuration will include larger overhead storage bins, improved lighting, and modifications to increase the size of the cabin to enhance passenger comfort. As part of this agreement, the delivery positions for the 30 firm cancelable/optional aircraft have been deferred until mid-2010 after the next-generation cabin configuration has been introduced by Bombardier. Despite delays by the manufacturer in the delivery of the Q400 aircraft, Colgan's Q400 operation has been warmly received by Continental Airlines and its customers.
-- During July, Pinnacle and Delta Air Lines agreed to defer the in-service dates of the remaining seven Bombardier CRJ-900 next generation regional jet aircraft to be operated under the Delta Connection Agreement (the "DCA"). During the second quarter, Pinnacle took delivery of three CRJ-900s, increasing its operating fleet to nine aircraft as of June 30. Pinnacle took delivery of two CRJ-900s during July 2008, and has deferred delivery of the remaining five aircraft until their respective in-service dates in 2009 under the DCA.
-- Operating performance with respect to Pinnacle's Northwest Airlink operations improved dramatically during the second quarter. Pinnacle experienced severe weather in its Northwest Airlink operations during the first quarter, causing it to record performance penalties during the first quarter to be paid for the six months ended June 30 under its Airline Services Agreement (the "ASA") with Northwest Airlines. Pinnacle's high level of performance in the second quarter reduced the overall performance penalty owed to Northwest for the six-month period by approximately $0.8 million to $1.7 million.
-- Pinnacle earned approximately $0.3 million in operating performance incentives under its DCA with Delta Air Lines during the second quarter. Pinnacle's Delta Connection performance improved from the first quarter, partially as a result of the schedule changes that Pinnacle and Delta cooperatively implemented in May and June.
"Pinnacle's operations rebounded in the second quarter to the industry leading performance that we are known for," said Phil Trenary, the Company's President and Chief Executive Officer. "In addition, Colgan reported almost break-even operating results on the strength of its new Q400 operations in spite of a nearly 69% increase in fuel costs related to its pro-rate operations. I am proud of the dedication our People at both Pinnacle and Colgan demonstrated despite a difficult industry environment."
Special Charges
The Company recorded a special charge related to the valuation of its auction rate securities ("ARS") portfolio during the second quarter. The Company's ARS portfolio has a par value of $136.1 million. These securities are secured by pools of student loans guaranteed by state-designated guaranty agencies and reinsured by the U.S. government. Auctions for these securities began failing in the first quarter of 2008 and have continued to fail throughout the second quarter. Additionally, a liquid secondary market for these securities has not developed. Given the uncertainty about if or when these securities will be salable for par value, the Company determined that the decline in the market value of these securities is other than temporary. As a result, the Company recorded an impairment charge of $8.7 million in the second quarter to reflect these securities at their estimated fair value. The Company will likely not receive a tax benefit for this charge, as this capital loss cannot be used to offset ordinary income from the Company's operations, and the Company does not expect to have capital gains in the near future. Therefore, net income for the second quarter 2008 was reduced by the full amount of the charge.
In addition, the Company evaluated certain tangible and intangible assets at its Colgan subsidiary in light of the high fuel cost environment and operating losses that Colgan has experienced over the last two quarters. The Company determined that goodwill and certain other assets recorded upon the acquisition of Colgan have been impaired by the industry-wide impact of unprecedented high fuel costs. In addition, the Company will incur costs associated with returning leased aircraft to lessors under its turn-around plan, as discussed below. The Company recorded a special charge of $12.6 million ($8.1 million net of related income taxes) during the second quarter to account for these items. Additionally, the Company expects to record an additional $1.3 million in lease return costs during the third quarter of 2008 under its turn-around plan.
Colgan Pro-Rate Operations Turn-Around Plan
The Company has developed a turn-around plan for Colgan's pro-rate operations to combat the dramatic increase in fuel prices that the entire airline industry is experiencing. The turn-around plan is designed to create a pro-rate operation that can be sustained without significant losses in the current high fuel cost environment. Key components of the turn-around plan include the following:
-- The elimination of 12 markets from Colgan's US Airways Express and United Express operations, effective October 2008. This will result in the retirement of ten Saab aircraft from service in addition to the previously announced retirement of Colgan's fleet of five Beech 1900 aircraft.
-- Increased subsidy under the Federal Essential Air Service ("EAS") program. To offset the increase in fuel costs, Colgan applied for changes in 13 of the 15 markets that it serves under the EAS program. Colgan was awarded service in seven of these markets with an increased subsidy totaling approximately $4 million annually. Colgan will also reduce capacity in four of these seven markets, further reducing Colgan's operating costs. The Department of Transportation ("DOT") accepted competing bids in four of the remaining six markets, and Colgan will exit these markets in October 2008 as part of the planned fleet reduction indicated above. The DOT has not acted upon applications in the remaining two markets. Assuming Colgan receives authority to continue operations in these two markets, Colgan will operate in 11 EAS markets after giving effect to these changes.
-- The addition of Colgan's new maintenance base at Washington/Dulles International airport, where Colgan maintains a significant presence operating as United Express. This will eliminate ferry flights from Colgan's existing maintenance facilities, reducing operating costs. In addition, Colgan has undertaken an effort to streamline its maintenance operations by reducing the number of stations where it maintains a line maintenance function and by increasing the productivity of its maintenance operations.
-- The transition of nine markets that Colgan operated from Pittsburgh under the US Airways Express brand to Washington/Dulles under the United Express brand. This transition was completed during the first quarter, and Colgan has seen an improvement in the revenue performance of these markets.
-- Discussions with United Airlines to jointly reduce certain costs that Colgan incurs at Washington/Dulles as a United Express carrier. Reducing certain distribution and ground handling costs or otherwise supplementing Colgan's revenue in its United Express markets is a key component of maintaining its operations at Washington/Dulles. If United and Colgan are unable to reduce these costs, Colgan may exit additional markets currently operated under the United Express brand.
These significant changes are designed to eliminate unprofitable markets and reduce the losses that Colgan is incurring in its pro-rate operations in the current high-cost fuel environment. The Company expects that the turn-around plan will result in an improvement in Colgan's financial performance, and may eliminate losses in Colgan's pro-rate operations on a full year basis. However, changes in unit revenue or additional increases in fuel costs will affect Colgan's financial performance. In addition, Colgan's profitability in these pro-rate markets will continue to fluctuate seasonally, with Colgan experiencing lower passenger demand and lower unit revenue in the fourth and first quarter of each year than in the second and third quarter of each year.
Second Quarter 2008 Financial and Operating Results
Pinnacle completed 112,051 block hours and 67,810 departures, increases of 2% and 1%, respectively, over the same period in 2007. Pinnacle's capacity increased due to the addition of its Delta Connection operations in 2008, offset partially by 13 fewer CRJ-200 aircraft operating under the ASA. Colgan completed 40,491 block hours and 31,984 departures during the second quarter, increases of 31% and 10%, respectively, over the same period in 2007. The addition of Colgan's Q400 fleet was the primary factor in the growth in its operations.
The Company recorded operating revenue of $221.2 million, an increase of $20.2 million, or 10%, over the same period in 2007. This increase is primarily related to revenue earned under the Company's new contracts with Delta and Continental. Excluding special charges, consolidated operating income and operating margin were $15.1 million and 6.8%, respectively, during the second quarter of 2008. Consolidated operating income and operating margin for the second quarter of 2007 were approximately $14.8 million and 7.4%, respectively. A $5.4 million year-over-year increase in fuel costs related to Colgan's pro-rate operations was partially offset by operating income from the addition of the Company's new Q400 and CRJ-900 operations and improvements in the financial performance of Pinnacle's existing CRJ-200 operations.
Net interest expense for the second quarter was approximately $7.1 million, as compared to net interest expense of $0 during the second quarter of 2007. The increase in net interest expense is driven by interest costs from the investments the Company has made in its new fleet of Q400 and CRJ-900 aircraft.
Net income for the second quarter excluding special charges was $5.4 million, as compared to net income during the second quarter of 2007 of $10.3 million, excluding special charges.
Cash and Investments
The Company ended the quarter with unrestricted cash and cash equivalents totaling $65.2 million.
The Company generated $16.2 million from operating activities during the second quarter. This included $3.4 million of net collateral deposits related to the Company's interest rate hedging program that were returned to the Company during the quarter and $12.8 million of cash flow from airline operations. Cash used for investing activities of $11.2 million primarily related to capital expenditures at the Company's operating subsidiaries. Cash used in financing activities was $16.7 million, which included $36.7 million in debt repayments associated with the Company's aircraft pre-delivery payment financing facilities and other related financing payments, offset by $20.0 million in proceeds from draws under the Company's bank credit facilities.
About Pinnacle Airlines Corp.
Pinnacle Airlines Corp., an airline holding company, is the parent company of Pinnacle Airlines, Inc. and Colgan Air, Inc. Pinnacle Airlines, Inc. operates under the name Northwest Airlink and Delta Connection and operates 125 CRJ-200 and nine CRJ-900 regional jet aircraft in the United States, Canada, the Bahamas, Mexico, U.S. Virgin Islands, and Turks and Caicos Islands. Colgan Air, Inc. operates as Continental Connection, United Express and US Airways Express and operates a fleet of 15 Q400, 40 Saab 340 and five Beech 1900 turboprop regional aircraft.
Non-GAAP Disclosures
This release and certain tables accompanying this release include certain financial information not prepared in accordance with generally accepted accounting principles ("GAAP"), the Company's consolidated operating income, operating margin, net income and diluted earnings (loss) per share ("EPS") for the three and six months ended June 30, 2008 and 2007, excluding special charges related to the impairment of Colgan's goodwill and intangible assets, Colgan's lease return costs, and the impairment of auction rate securities in 2008 and the loss on the sale of the unsecured claim in the second quarter of 2007. The Company believes that this information is useful to investors as it indicates more clearly the Company's comparative year-to-year results. None of this information should be considered a substitute for any measures prepared in accordance with GAAP. The Company has included its reconciliations of these non-GAAP financial measures to the most comparable GAAP financial measures in the accompanying schedules.
Forward-Looking Statements
This press release contains various forward-looking statements that are based on management's beliefs, as well as assumptions made by and information currently available to management. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Such statements are subject to certain risks, uncertainties and assumptions, including those set forth in our filings with the Securities and Exchange Commission, which are available to investors at our website or online from the Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove erroneous, actual results may vary materially from results that were anticipated or projected. The Company does not intend to update these forward-looking statements before its next required filing with the Securities and Exchange Commission.
For further information, please contact Joe Williams, at (901) 346-6162, or visit our website at www.pncl.com.
Pinnacle Airlines Corp. Condensed Consolidated Statements of Income (Unaudited) (in thousands, except per share data) Three Months Ended June 30, ---------------------- 2008 2007 ---------- ---------- Operating revenues Regional airline services $ 219,013 $ 198,480 Other 2,141 2,514 ---------- ---------- Total operating revenues 221,154 200,994 Operating expenses Salaries, wages and benefits 57,147 50,261 Aircraft fuel 14,899 9,512 Aircraft maintenance, materials and repairs 23,694 23,345 Aircraft rentals 32,507 35,306 Other rentals and landing fees 17,372 15,061 Ground handling services 23,672 23,873 Commissions and passenger related expense 7,427 6,741 Depreciation and amortization 6,604 2,318 Other 22,742 19,755 Impairment of goodwill and other charges 12,619 - ---------- ---------- Total operating expenses 218,683 186,172 ---------- ---------- Operating income 2,471 14,822 Operating income as a percentage of operating revenues 1.1% 7.4% Nonoperating (expense) income Interest income 1,724 2,882 Interest expense (8,821) (2,907) Impairment of auction rate securities (8,675) - Loss on sale of unsecured claim - (4,144) Miscellaneous income 148 318 ---------- ---------- Total nonoperating expense (15,624) (3,851) ---------- ---------- Income (loss) before income taxes (13,153) 10,971 Income tax benefit (expense) 1,702 (3,309) ---------- ---------- Net income (loss) $ (11,451) $ 7,662 ========== ========== Basic earnings (loss) per share $ (0.64) $ 0.35 ========== ========== Diluted earnings (loss) per share $ (0.64) $ 0.32 ========== ========== Shares used in computing basic (loss) earnings per share 17,869 21,752 ========== ========== Shares used in computing diluted (loss) earnings per share 17,869 24,240 ========== ========== Pinnacle Airlines Corp. Condensed Consolidated Statements of Income (Unaudited) (in thousands, except per share data) Six Months Ended June 30, -------------------------- 2008 2007 ------------ ------------ Operating revenues Regional airline services $ 420,172 $ 375,425 Other 5,323 5,119 ------------ ------------ Total operating revenues 425,495 380,544 Operating expenses Salaries, wages and benefits 112,473 97,562 Aircraft fuel 26,772 15,933 Aircraft maintenance, materials and repairs 45,542 41,439 Aircraft rentals 66,028 69,029 Other rentals and landing fees 32,849 28,971 Ground handling services 51,061 47,965 Commissions and passenger related expense 14,253 11,566 Depreciation and amortization 10,980 4,372 Other 43,667 36,060 Impairment of goodwill and other charges 12,619 - ------------ ------------ Total operating expenses 416,244 352,897 ------------ ------------ Operating income 9,251 27,647 Operating income as a percentage of operating revenues 2.2% 7.3% Nonoperating (expense) income Interest income 4,038 5,947 Interest expense (13,663) (4,981) Impairment of auction rate securities (8,675) - Loss on sale of unsecured claim - (4,144) Miscellaneous (expense) income (26) 336 ------------ ------------ Total nonoperating expense (18,326) (2,842) ------------ ------------ Income (loss) before income taxes (9,075) 24,805 Income tax benefit (expense) 277 (7,778) ------------ ------------ Net income (loss) $ (8,798) $ 17,027 ============ ============ Basic earnings (loss) per share $ (0.49) $ 0.78 ============ ============ Diluted earnings (loss) per share $ (0.49) $ 0.70 ============ ============ Shares used in computing basic (loss) earnings per share 17,864 21,869 ============ ============ Shares used in computing diluted (loss) earnings per share 17,864 24,489 ============ ============ Pinnacle Airlines Corp. Condensed Consolidated Balance Sheets (in thousands, except share data) June 30, December 31, 2008 2007 ------------ ------------ Assets (Unaudited) Current assets Cash and cash equivalents $ 65,228 $ 26,785 Restricted cash 4,948 5,327 Short-term investments - 186,850 Receivables, net 34,683 31,107 Spare parts and supplies, net 20,176 16,030 Prepaid expenses and other assets 11,233 16,535 Deferred income taxes, net of allowance 13,600 12,285 Income taxes receivable 13,758 - ------------ ------------ Total current assets 163,626 294,919 Property and equipment Flight equipment 560,126 162,374 Aircraft pre-delivery payments 23,054 81,425 Other property and equipment 43,124 39,969 Less accumulated depreciation (39,042) (28,358) ------------ ------------ Net property and equipment 587,262 255,410 Investments 127,425 - Deferred income taxes, net of allowance 69,698 79,856 Other assets, primarily aircraft deposits 33,706 28,528 Debt issuance costs, net 6,229 4,598 Goodwill 18,422 28,206 Intangible assets, net 15,419 17,071 ------------ ------------ Total assets $ 1,021,787 $ 708,588 ============ ============ Liabilities and stockholders' equity Current liabilities Short-term notes payable and current maturities of long-term debt $ 39,036 $ 73,513 Bank lines of credit 88,275 8,375 Accounts payable 29,447 33,062 Deferred revenue 23,839 24,099 Accrued expenses and other current liabilities 82,963 104,410 ------------ ------------ Total current liabilities 263,560 243,459 Senior convertible notes 121,000 121,000 Long-term debt, less current maturities 388,082 71,812 Deferred revenue, net of current portion 200,326 209,752 Other liabilities 4,207 4,743 Commitments and contingencies Stockholders' equity Series A preferred share, stated value $100 per share, one issued share, retired on January 4, 2008 - - Common stock, $0.01 par value; 40,000,000 shares authorized; 22,514,782 and 22,402,999 shares issued, respectively 225 224 Treasury stock, at cost, 4,450,092 shares (68,152) (68,152) Additional paid-in capital 92,625 91,165 Accumulated other comprehensive loss (16,073) (10,200) Retained earnings 35,987 44,785 ------------ ------------ Total stockholders' equity 44,612 57,822 ------------ ------------ Total liabilities and stockholders' equity $ 1,021,787 $ 708,588 ============ ============ Pinnacle Airlines Corp. Condensed Consolidated Statements of Cash Flows (Unaudited) (in thousands) Six Months Ended June 30, -------------------------- 2008 2007 ------------ ------------ Cash (used in) provided by operating activities $ (1,062) $ 280,910 Cash provided by (used in) investing activities 31,490 (209,682) Cash provided by (used in) financing activities 8,015 (37,476) ------------ ------------ Net increase in cash and cash equivalents 38,443 33,752 Cash and cash equivalents at beginning of period 26,785 705 ------------ ------------ Cash and cash equivalents at end of period $ 65,228 $ 34,457 ============ ============ Pinnacle Airlines Corp. Operating Statistics (Unaudited) Pinnacle Airlines Corp. Consolidated --------------------------------------------------------------- Three Months Ended June 30, Six Months Ended June 30, ------------------------------- ------------------------------ 2008 2007 Change 2008 2007 Change --------- --------- --------- --------- --------- -------- Other Data: Revenue passengers (in thousands) 3,389 3,058 11% 6,253 5,528 13% Revenue passenger miles (in thous- ands) 1,436,388 1,310,470 10% 2,624,389 2,368,071 11% Available seat miles ("ASMs") (in thous- ands) 1,890,857 1,693,208 12% 3,565,313 3,244,434 10% Passenger load factor 76.0% 77.4% (1.4) pts. 73.6% 73.0% 0.6 pts. Block hours 152,542 140,630 8% 297,737 272,733 9% Departures 99,794 96,308 4% 192,573 181,161 6% Number of operating aircraft (end of period) 193 191 1% Employees (end of period) 5,680 5,280 8% Pinnacle Airlines, Inc. --------------------------------------------------------------- Three Months Ended June 30, Six Months Ended June 30, ------------------------------- ------------------------------ 2008 2007 Change 2008 2007 Change --------- --------- --------- --------- --------- -------- Other Data: Revenue passengers (in thousands) 2,726 2,643 3% 5,151 4,841 6% Revenue passenger miles (in thous- ands) 1,287,429 1,233,335 4% 2,386,709 2,240,500 7% Available seat miles (in thous- ands) 1,622,264 1,532,510 6% 3,116,125 2,965,558 5% Passenger load factor 79.4% 80.5% (1.1) pts. 76.6% 75.6% 1.0 pts. Operating revenue per ASM (in cents) 9.60 9.73 (1)% 9.95 9.87 1% Operating cost per ASM (in cents) 8.65 8.81 (2)% 9.07 8.96 1% Operating revenue per block hour $ 1,390 $ 1,358 2% $ 1,384 $ 1,350 3% Operating cost per block hour $ 1,252 $ 1,230 2% $ 1,260 $ 1,225 3% Block hours 112,051 109,810 2% 224,112 216,823 3% Departures 67,810 67,265 1% 133,789 131,228 2% Average daily utilization (block hours) 8.97 8.68 3% 8.91 8.81 1% Average stage length (miles) 468 461 2% 461 459 -% Number of operating aircraft (end of period) CRJ-200 126 139 (9)% CRJ-900 9 - 100% Employees (end of period) 4,144 4,015 3% Colgan Air, Inc. -------------------------------------------------------- Three Months Ended June 30, Six Months Ended June 30, --------------------------- --------------------------- 2008 2007 Change 2008 2007 Change ------- ------- --------- ------- ------- --------- Other Data: Revenue passengers (in thousands) 663 415 60% 1,102 687 60% Revenue passenger miles (in thousands) 148,959 77,135 93% 237,680 127,571 86% Available seat miles (in thousands) 268,593 160,698 67% 449,188 278,876 61% Passenger load factor 55.5% 48.0% 7.5 pts. 52.9% 45.7% 7.2 pts. Operating revenue per ASM (in cents) 24.37 32.19 (24)% 25.69 31.50 (18)% Operating cost per ASM (in cents) 29.18 31.70 (8)% 29.78 31.34 (5)% Operating cost per ASM (in cents) (excluding impairment of goodwill and other charges) 24.48 31.70 (23)% 26.97 31.34 (14)% Operating revenue per block hour $ 1,616 $ 1,678 (4)% $ 1,567 $ 1,571 -% Operating cost per block hour $ 1,936 $ 1,653 17% $ 1,817 $ 1,563 16% Operating cost per block hour (excluding impairment of goodwill and other charges) $ 1,624 $ 1,653 (2)% $ 1,646 $ 1,563 5% Block hours 40,491 30,820 31% 73,625 55,910 32% Departures 31,984 29,043 10% 58,784 49,933 18% Average daily utilization (block hours) 7.76 6.50 19% 7.56 6.65 14% Average stage length (miles) 211 185 14% 203 184 10% Fuel consumption (in thousands of gallons) 3,931 4,299 (9)% 7,617 8,124 (6)% Average price per gallon 3.79 2.25 69% 3.51 2.15 63% Number of operating aircraft (end of period) Saab 340 40 42 (5)% Beech 1900 5 10 (50)% Q400 13 - 100% Employees (end of period) 1,427 1,183 21% Pinnacle Airlines Corp. Reconciliation of Non-GAAP Disclosures (Unaudited) (in thousands, except per share data) Three Months Ended June 30, ------------------------------------ % Increase 2008 2007 (Decrease) ----------- ----------- ---------- Consolidated operating income: Operating income in accordance with GAAP $ 2,471 $ 14,822 (83)% Add: Impairment of goodwill and other charges 12,619 - 100% ----------- ----------- ---------- Non-GAAP operating income $ 15,090 $ 14,822 2% =========== =========== ========== Consolidated operating margin: Operating margin in accordance with GAAP 1.1% 7.4% (6.3) pts. Add: Impairment of goodwill and other charges 5.7% - 5.7 pts. ----------- ----------- ---------- Non-GAAP operating margin 6.8% 7.4% (0.6) pts. =========== =========== ========== Net (loss) income: Net (loss) income in accordance with GAAP $ (11,451) $ 7,662 (249)% Add: Impairment of goodwill and other charges, net of tax 8,139 - 100% Add: Impairment of auction rate securities 8,675 - 100% Add: Loss on sale of unsecured claim, net of tax - 2,644 (100)% ----------- ----------- ---------- Non-GAAP net income $ 5,363 $ 10,306 (48)% =========== =========== ========== Diluted earnings (loss) per share: Diluted earnings (loss) per share in accordance with GAAP $ (0.64) $ 0.32 (300)% Add: Impairment and of goodwill and other charges, net of tax 0.45 - 100% Add: Impairment of auction rate securities 0.49 - 100% Add: Loss on sale of unsecured claim, net of tax - 0.11 (100)% ----------- ----------- ---------- Non-GAAP diluted earnings per share $ 0.30 $ 0.43 (30)% =========== =========== ========== Six Months Ended June 30, ------------------------------------ % Increase 2008 2007 (Decrease) ----------- ----------- ---------- Consolidated operating income: Operating income in accordance with GAAP $ 9,251 $ 27,647 (67)% Add: Impairment of goodwill and other charges 12,619 - 100% ----------- ----------- ---------- Non-GAAP operating income $ 21,870 $ 27,647 (21)% =========== =========== ========== Consolidated operating margin: Operating margin in accordance with GAAP 2.2% 7.3% (5.1) pts. Add: Impairment of goodwill and other charges 3.0% - 3.0 pts. ----------- ----------- ---------- Non-GAAP operating margin 5.2% 7.3% (2.1) pts. =========== =========== ========== Net income: Net (loss) income in accordance with GAAP $ (8,798) $ 17,027 (152)% Add: Impairment of goodwill and other charges, net of tax 8,139 - 100% Add: Impairment of auction rate securities 8,675 - 100% Add: Loss on sale of unsecured claim, net of tax - 2,635 (100)% ----------- ----------- ---------- Non-GAAP net income $ 8,016 $ 19,662 (59)% =========== =========== ========== Diluted EPS: Diluted earnings (loss) per share in accordance with GAAP $ (0.49) $ 0.70 (170)% Add: Impairment of goodwill and other charges, net of tax 0.45 - 100% Add: Impairment of auction rate securities 0.49 - 100% Add: Loss on sale of unsecured claim, net of tax - 0.11 (100)% ----------- ----------- ---------- Non-GAAP diluted earnings per share $ 0.45 $ 0.81 (44)% =========== =========== ========== For further information, please contact: Joe Williams (901) 346-6162 www.pncl.com
SOURCE: Pinnacle Airlines
Source: MARKET WIRE
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