EX-99.1 2 exhibit99_1.htm EX 99.1 EARNINGS RELEASE Ex 99.1 Earnings Release
 
 
 
                                             
For Immediate release:                                                                            
                                                                                Contact: Warren R. Wilkinson
                                                                                Republic Airways Holdings
                                                                                Tel. (317) 484-6042

Republic Airways Holdings Announces Second Quarter 2005 Results

Indianapolis, Indiana, (July 27, 2005) - Republic Airways Holdings Inc. (NASDAQ/NM: RJET) today reported operating revenues of $188.8 million for the quarter ended June 30, 2005, a 35.8% increase, compared to $139.0 million for the same period last year.  The Company also reported net income of $13.4 million for the quarter ended June 30, 2005, or $0.40 per diluted share, compared to $7.2 million of net income or $0.31 per diluted share for the same period last year.  Weighted average diluted common shares outstanding increased to 33.3 million, or 44.6% as a result of the Company’s public offerings in May 2004 and February 2005.

The primary items of significance affecting the second quarter of 2005 are outlined below:

Total operating revenues for the second quarter of 2005 increased primarily as a result of a 40.7% increase in available seat miles (ASMs) to 1.6 billion ASMs, up from 1.1 billion ASMs and a 26.5% increase in block hours. These increases reflect the addition of 36 regional jet aircraft that were placed into service since June 30, 2004.

Total operating expenses for the second quarter of 2005, including interest expense but excluding fuel charges (which are reimbursable by the Company’s major partners) of $128.7 million, increased approximately 29.3% from $99.5 million for the same quarter of 2004. Operating cost per ASM (CASM), including interest expense, but excluding fuel, decreased 8.2% to 8.2¢ per ASM, from the prior year’s 8.9¢ per ASM. Included in operating expenses in 2005 was $2.8 million, or approximately 0.2¢ per ASM of amounts paid to American relating to the operation of 70-seat aircraft at Chautauqua Airlines.

Beginning in May 2005, US Airways elected to provide fuel directly for all of the Company’s US Airways Express aircraft operations. This change eliminates fuel expense and the related fuel reimbursement (previously recorded as revenue) for the US Airways operations. Operating profits are not affected by this change.

During the quarter, the Company announced that it intends to proceed with its transaction with US Airways to purchase Embraer 170’s and other assets for approximately $110.0 million. The Company will purchase ten Embraer 170 aircraft and assume leases on an additional 18 Embraer 170 aircraft and will begin operating them in the US Airways network under a previously negotiated regional jet service agreement that has been approved by the U.S. Bankruptcy Court. The Company will also purchase, and lease back to US Airways, 113 commuter slots at Ronald Reagan Washington National Airport, and 24 commuter slots at New York LaGuardia Airport. Other assets to be acquired include a flight simulator, spare parts, and certain facilities to support the Embraer 170 aircraft operations.

Also during the quarter, the Company acquired Shuttle America Corporation, which gives the Company added flexibility in operating larger gauge regional jets as the Company will soon have 3 operating certificates with each operating a single-fleet type of regional jets as follows: 37-50 seat (Chautauqua Airlines), 70 seat (Shuttle America), and 70+ seats (Republic Airline).

The Company also amended its airline services agreement with United to provide an additional five 70-seat Embraer 170s bringing the total number of 170s to be operated as United Express to 28 aircraft. Two 50-seat Embraer 145 aircraft will be removed from service as a result of the amended agreement and used as spares and for charter operations.

The Company increased its fleet of Embraer regional jet aircraft to 124 (40 Delta, 32 United, 15 American, 35 US Airways and 2 Charter; including 24 Embraer 170 aircraft) as of June 30, 2005, from 116 aircraft as of March 31, 2005.  During the quarter, the Company took delivery of eight Embraer 170, 70-seat regional jet aircraft. The Company also returned 6 Saab turboprop aircraft during the quarter, reducing the Saab fleet to 11 aircraft, which are expected to be phased out of service by the end of November 2005.

At June 30, 2005, the Company had $127.6 million in cash and marketable securities compared to $119.7 million as of March 31, 2005.  The Company entered into lease financing arrangements for two of the eight aircraft delivered during the quarter and debt financing arrangements for the remaining six aircraft. The Company’s long-term debt increased to $1.03 billion as of June 30, 2005, compared to $934.8 million at March 31, 2005. The Company also has significant long-term operating lease obligations.  At a 7.0% discount factor, the present value of these lease obligations was approximately $552.0 million as of June 30, 2005.

Republic Airways Holdings, based in Indianapolis, Indiana is an airline holding company that operates Chautauqua Airlines, Republic Airline and Shuttle America. The Company offers scheduled passenger service on more than 800 flights daily to 82 cities in 32 states, Canada and the Bahamas through airline services agreements with four major U.S. airlines. All of its flights are operated under its major airline partner brand, such as AmericanConnection, Delta Connection, United Express and US Airways Express. The airline currently employs more than 2,900 aviation professionals and operates 124 aircraft including 24 Embraer 170 aircraft. 

The Company will conduct a telephone briefing to discuss its second quarter results today at 11:00 a.m. EDT. A live Webcast of this briefing will be available online at www.rjet.com - investor relations.

Additional Information
In addition to historical information, this release contains forward-looking statements. Republic Airways may, from time-to-time, make written or oral forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements encompass Republic Airways’ beliefs, expectations, hopes or intentions regarding future events. Words such as "expects," "intends," "believes," "anticipates," "should," "likely" and similar expressions identify forward-looking statements. All forward-looking statements included in this release are made as of the date hereof and are based on information available to Republic Airways as of such date. Republic Airways assumes no obligation to update any forward-looking statement. Actual results may vary, and may vary materially, from those anticipated, estimated, projected or expected for a number of reasons, including, among others, the risks discussed in our Form 10-K and our other filings made with the Securities and Exchange Commission, which discussions are incorporated into this release by reference.







REPUBLIC AIRWAYS HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars and Shares in Thousands, Except per Share Amounts)
(Unaudited)
 
  
 Three Months Ended June 30
  
Six Months Ended June 30
  
 
Financial Highlights
  
2005
 
2004
 
Change
 
2005
 
2004
 
Change
  
OPERATING REVENUES
                                      
Passenger
  
$
186,860
  
$
137,728
    
35.7
%
$
370,213
  
$
265,447
    
39.5
%
Other
    
1,985
   
1,291
   
53.8
%
  
6,970
   
5,103
   
36.6
%
Total operating revenues
    
188,845
   
139,019
   
35.8
%
  
377,183
   
270,550
   
39.4
%
                                       
OPERATING EXPENSES
                                      
Wages and benefits
    
34,846
   
27,335
   
27.5
%
  
66,802
   
54,104
   
23.5
%
Aircraft fuel
    
38,781
   
26,753
   
45.0
%
  
84,064
   
51,003
   
64.8
%
Landing fees
    
7,059
   
5,205
   
35.6
%
  
13,428
   
10,303
   
30.3
%
Aircraft and engine rent
    
19,096
   
17,865
   
6.9
%
  
37,595
   
35,488
   
5.9
%
Maintenance and repair
    
19,231
   
18,512
   
3.9
%
  
37,576
   
34,694
   
8.3
%
Insurance and taxes
    
4,145
   
3,490
   
18.8
%
  
7,990
   
6,419
   
24.5
%
Depreciation and amortization
    
14,391
   
7,974
   
80.5
%
  
27,999
   
15,190
   
84.3
%
Other
    
16,327
   
13,123
   
24.4
%
  
30,221
   
23,946
   
26.2
%
Total operating expenses
    
153,876
   
120,257
   
28.0
%
  
305,675
   
231,147
   
32.2
%
OPERATING INCOME
    
34,969
   
18,762
   
86.4
%
  
71,508
   
39,403
   
81.5
%
                                       
OTHER INCOME (EXPENSE)
                                      
Interest expense
    
(13,566
)
  
(5,979
)
  
126.9
%
  
(26,291
)
  
(12,371
)
  
112.5
%
Other income
    
876
   
74
   
1083.8
%
  
1,392
   
150
   
828.0
%
Total other income (expense)
    
(12,690
)
  
(5,905
)
  
114.9
%
  
(24,899
)
  
(12,221
)
  
103.7
%
                                       
INCOME BEFORE INCOME TAXES
    
22,279
   
12,857
   
73.3
%
  
46,609
   
27,182
   
71.5
%
                                       
INCOME TAX EXPENSE
    
8,883
   
5,623
   
58.0
%
  
18,389
   
11,669
   
57.6
%
                                       
NET INCOME
    
13,396
   
7,234
   
85.2
%
  
28,220
   
15,513
   
81.9
%
PER SHARE, BASIC
  
$
0.41
  
$
0.32
    
27.2
%
$
0.91
  
$
0.73
    
23.6
%
PER SHARE, DILUTED
  
$
0.40
  
$
0.31
    
28.1
%
$
0.88
  
$
0.71
    
23.8
%
Weighted Average Common Shares
                                      
Basic
    
32,483
   
22,317
   
45.6
%
  
31,142
   
21,159
   
47.2
%
Diluted
    
33,341
   
23,055
   
44.6
%
  
31,906
   
21,718
   
46.9
%
 

 
Unaudited Operating Highlights
  
   
Three Months Ended
  
Six Months Ended
  
Operating Highlights
  
June 30, 2005
  
June 30, 2005
  
 
2005
  
2004
  
Change
  
2005
  
2004
  
Change
  
Passengers carried
    
2,346,187
    
1,713,179
    
36.9
%
  
4,383,566
    
3,103,237
    
41.3
%
Revenue passenger miles (000)
    
1,128,722
    
777,980
    
45.1
%
  
2,090,409
    
1,419,929
    
47.2
%
Available seat miles (000)
    
1,573,120
    
1,118,305
    
40.7
%
  
3,012,766
    
2,189,060
    
37.6
%
Passenger load factor
    
71.8
%
  
69.6
%
  
2.2 pts
    
69.4
%
  
64.9
%
  
4.5 pts
  
Cost per available seat mile, including interest expense (cents)
    
10.64
   
11.29
   
-5.8
%
  
11.02
   
11.12
   
-0.9
%
Fuel cost per available seat mile
    
2.47
   
2.39
   
3.3
%
  
2.79
   
2.33
   
19.7
%
Cost per available seat mile, excluding fuel expense (cents)
    
8.17
   
8.90
   
-8.2
%
  
8.23
   
8.79
   
-6.4
%
Block hours
    
115,257
    
91,146
    
26.5
%
  
224,606
    
177,904
    
26.3
%
Departures
    
69,685
    
57,720
    
20.7
%
  
135,052
    
112,168
    
20.4
%
Average daily utilization of each aircraft (hours)
    
10.6
    
10.1
    
5.0
%
  
10.7
    
10.0
    
7.0
%
Average aircraft stage length
    
470
    
444
    
5.9
%
  
468
    
448
    
4.5
%