Frontier Narrows Loss on Passenger Revenue
DENVER – Frontier Airlines Inc. said Thursday it narrowed its third-quarter net loss as higher passenger revenue helped offset a 35 percent jump in fuel costs and $6 million in lost income from hurricane-related service disruptions.
The Denver-based airline lost $10.3 million, or 28 cents a share, for the quarter ending Dec. 31, compared with a loss of $11.1 million, or 31 cents a share, for the third quarter of 2004.
The most recent results reflected a 3-cent-per-share loss attributed to $1.5 million in unrealized losses on fuel hedges and a $300,000 gain from the sale of Boeing aircraft parts. Special items in the previous quarter totaled a 7-cent-per-share loss.
Analysts surveyed by Thomson Financial had forecast a loss of 19 cents a share for the October-December quarter.
Excluding special items in both quarters, the results would have been about even, Chief Financial Officer Paul Tate said.
Fuel costs increased more than a third in a year-over-year comparison, he said. “It was the worst quarter in the history of the airline business as far as fuel prices,” Tate said.
Third-quarter revenue totaled $246.9 million, up from $208.2 million in the comparable quarter of the previous year.
As a result of hurricane damage, the carrier said it lost about $4.8 million in revenue on service to Cancun and Cozumel in Mexico and $1.8 million because it discontinued service to New Orleans.
Frontier Chief Executive Jeff Potter said he hoped to post break-even results in the current quarter if fuel prices remain stable, despite low-cost leader Southwest Airlines’ entry into the Denver market in January. Analysts forecast a 1-cent per share profit.
Frontier shares fell 2 cents to close at $7.79 Thursday on the Nasdaq Stock Market, before the income report was released. It has traded between $7.88 a share and $7.65 a share in the past 52 weeks.
Frontier flies to 47 cities in 28 states and seven cities in Mexico from its Denver hub.
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On the Net: http://www.frontierairlines.com