001-35186 (Commission File Number) | 38-1747023 (IRS Employer Identification Number) |
[] | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
[] | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
[] | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
[] | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. | Results of Operations and Financial Condition. |
Item 9.01. | Financial Statements and Exhibits. |
Exhibit No. | Description | |
99.1 | Press Release regarding fourth quarter and full year 2013 financial results. |
Date: February 19, 2014 | SPIRIT AIRLINES, INC. |
Exhibit No. | Description | |
99.1 | Press Release regarding fourth quarter and full year 2013 financial results. |
• | Adjusted net income for the fourth quarter 2013 increased 109.9 percent to $41.0 million ($0.56 per diluted share) compared to $19.5 million ($0.27 per diluted share) for the fourth quarter 20121. GAAP net income for the fourth quarter 2013 was $43.2 million ($0.59 per diluted share) compared to $19.6 million ($0.27 per diluted share) in the fourth quarter 2012. |
• | Adjusted net income for the full year 2013 increased 71.0 percent to $177.5 million ($2.43 per diluted share) compared to $103.8 million ($1.43 per diluted share) for the full year 20121. GAAP net income for the full year 2013 was $176.9 million ($2.42 per diluted share) compared to $108.5 million ($1.49 per diluted share) for the full year 2012. |
• | For the fourth quarter 2013, Spirit achieved an adjusted pre-tax margin of 15.4 percent, an improvement of 5.7 percentage points over the same period in 20121. On a GAAP basis, pre-tax margin for the fourth quarter 2013 was 16.2 percent, compared to 9.7 percent in the fourth quarter 2012. For the full year 2013, Spirit's adjusted pre-tax margin was 17.1 percent, compared to 12.7 percent in 20121. Pre-tax margin on a GAAP basis for the full year 2013 was 17.1 percent, compared to 13.2 percent in 2012. |
• | Spirit ended 2013 with $530.6 million in unrestricted cash. |
• | Spirit's return on invested capital (before taxes and excluding special items) for the twelve months ended December 31, 2013 was 31.8 percent. See "Calculation for Return on Invested Capital" table below for more details. |
- Dallas/Fort Worth and New Orleans (1/24/13) | - Houston and Denver (6/13/13) |
- Houston and Orlando (2/14/13) | - Houston and Detroit (6/13/13) |
- Detroit and Denver (2/14/13) | - Phoenix Sky Harbor and Dallas/Fort Worth (10/24/13) |
- Dallas/Fort Worth and Minneapolis-St. Paul (4/4/13) | - Phoenix Sky Harbor and Chicago/O'Hare (11/7/13)2 |
- Dallas/Fort Worth and Philadelphia (4/5/13) | - Phoenix Sky Harbor and Denver (11/7/13) |
- Houston and Los Angeles (4/25/13) | - Minneapolis-St. Paul and Los Angeles (11/7/13) |
- Dallas/Fort Worth and Oakland/ | - Minneapolis-St. Paul and Orlando (11/7/13)2 |
San Francisco (4/25/13) | - Minneapolis-St. Paul and Phoenix (11/7/13)2 |
- Dallas/Fort Worth and Los Angeles (4/25/13) | - Minneapolis-St. Paul and Tampa (11/7/13)2 |
- Dallas/Fort Worth and Cancun, Mexico (4/25/13) | - Minneapolis-St. Paul and Houston (5/1/14)2 |
- Baltimore/Washington and Las Vegas (4/25/13) | - Minneapolis-St. Paul and Baltimore/ |
- Baltimore/Washington and Myrtle Beach (4/25/13)2 | Washington (5/1/14)2 |
- Philadelphia and Myrtle Beach (4/25/13)2 | - Chicago O'Hare and Oakland/San Francisco (5/1/14) |
- Philadelphia and Las Vegas (4/25/13) | - Minneapolis-St. Paul and Detroit (5/22/14)2 |
- Minneapolis-St. Paul and Denver (4/25/13)2 | - Chicago O'Hare and Baltimore/Washington (5/22/14)2 |
- Dallas/Fort Worth and Los Cabos, Mexico (6/13/13) | - Chicago O'Hare and Portland, OR (5/22/14)2 |
- Dallas/Fort Worth and Latrobe/Pittsburgh (6/14/13) |
• | Launched service to 25 new markets in 2013. |
• | Ratified a new five-year contract with its dispatchers which are represented by the Transport Workers Union. |
• | Elected H. McIntyre (Mac) Gardner as Chairman of the Board of Directors. |
• | Ordered an additional 20 new A321 aircraft, converted 10 existing A320 orders to A321 orders, and converted 5 A321ceo orders to A321neo orders. These aircraft are scheduled to deliver between 2015 and 2018. The Company also advanced 4 A320 aircraft originally scheduled to deliver in 2015 to deliver in 2014, bringing its total planned aircraft deliveries in 2014 to 11. |
• | Maintained its commitment to offer low fares to its valued customers (average ticket revenue per passenger flight segment for the full year 2013 was $79.43). |
Three Months Ended | Year Ended | ||||||||||||||||||||
December 31, | Percent | December 31, | Percent | ||||||||||||||||||
2013 | 2012 | Change | 2013 | 2012 | Change | ||||||||||||||||
Operating revenues: | |||||||||||||||||||||
Passenger | $ | 246,503 | $ | 188,721 | 30.6 | $ | 986,018 | $ | 782,792 | 26.0 | |||||||||||
Non-ticket | 173,481 | 139,547 | 24.3 | 668,367 | 535,596 | 24.8 | |||||||||||||||
Total operating revenues | 419,984 | 328,268 | 27.9 | 1,654,385 | 1,318,388 | 25.5 | |||||||||||||||
Operating expenses: | |||||||||||||||||||||
Aircraft fuel | 139,843 | 120,789 | 15.8 | 551,746 | 471,763 | 17.0 | |||||||||||||||
Salaries, wages and benefits | 69,392 | 58,363 | 18.9 | 262,150 | 218,919 | 19.7 | |||||||||||||||
Aircraft rent | 44,616 | 37,103 | 20.2 | 169,737 | 143,572 | 18.2 | |||||||||||||||
Landing fees and other rents | 22,096 | 17,128 | 29.0 | 83,604 | 68,368 | 22.3 | |||||||||||||||
Distribution | 16,607 | 13,109 | 26.7 | 67,481 | 56,668 | 19.1 | |||||||||||||||
Maintenance, materials and repairs | 16,253 | 12,206 | 33.2 | 60,143 | 49,460 | 21.6 | |||||||||||||||
Depreciation and amortization | 9,544 | 5,244 | 82.0 | 31,947 | 15,256 | 109.4 | |||||||||||||||
Other operating | 33,787 | 32,024 | 5.5 | 144,586 | 127,886 | 13.1 | |||||||||||||||
Loss on disposal of assets | 99 | 474 | na | 525 | 956 | na | |||||||||||||||
Special charges (credits) | (314 | ) | (105 | ) | na | 174 | (8,450 | ) | na | ||||||||||||
Total operating expenses | 351,923 | 296,335 | 18.8 | 1,372,093 | 1,144,398 | 19.9 | |||||||||||||||
Operating income | 68,061 | 31,933 | 113.1 | 282,292 | 173,990 | 62.2 | |||||||||||||||
Other (income) expense: | |||||||||||||||||||||
Interest expense | 74 | 6 | 1,133.3 | 214 | 1,350 | (84.1 | ) | ||||||||||||||
Capitalized interest | (74 | ) | (6 | ) | 1,133.3 | (214 | ) | (1,350 | ) | (84.1 | ) | ||||||||||
Interest income | (93 | ) | (159 | ) | (41.5 | ) | (401 | ) | (925 | ) | (56.6 | ) | |||||||||
Other expense | 31 | 95 | (67.4 | ) | 283 | 331 | (14.5 | ) | |||||||||||||
Total other (income) expense | (62 | ) | (64 | ) | na | (118 | ) | (594 | ) | na | |||||||||||
Income before income taxes | 68,123 | 31,997 | 112.9 | 282,410 | 174,584 | 61.8 | |||||||||||||||
Provision for income taxes | 24,930 | 12,431 | 100.5 | 105,492 | 66,124 | 59.5 | |||||||||||||||
Net income | $ | 43,193 | $ | 19,566 | 120.8 | $ | 176,918 | $ | 108,460 | 63.1 | |||||||||||
Basic earnings per share | $ | 0.59 | $ | 0.27 | 118.5 | $ | 2.44 | $ | 1.50 | 62.7 | |||||||||||
Diluted earnings per share | $ | 0.59 | $ | 0.27 | 118.5 | $ | 2.42 | $ | 1.49 | 62.4 | |||||||||||
Weighted average shares, basic | 72,658 | 72,442 | 0.3 | 72,593 | 72,386 | 0.3 | |||||||||||||||
Weighted average shares, diluted | 73,195 | 72,623 | 0.8 | 72,999 | 72,591 | 0.6 |
December 31, | December 31, | ||||||
2013 | 2012 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 530,631 | $ | 416,816 | |||
Accounts receivable, net | 23,246 | 22,740 | |||||
Deferred income taxes | 16,243 | 12,591 | |||||
Prepaid expenses and other current assets | 78,955 | 95,210 | |||||
Total current assets | 649,075 | 547,357 | |||||
Property and equipment: | |||||||
Flight equipment | 9,847 | 2,648 | |||||
Ground and other equipment | 50,987 | 43,580 | |||||
Less accumulated depreciation | (25,221 | ) | (17,825 | ) | |||
35,613 | 28,403 | ||||||
Deposits on flight equipment purchase contracts | 157,669 | 96,692 | |||||
Aircraft maintenance deposits | 161,484 | 122,379 | |||||
Deferred heavy maintenance, net | 125,288 | 80,533 | |||||
Other long-term assets | 51,636 | 44,520 | |||||
Total assets | $ | 1,180,765 | $ | 919,884 | |||
Liabilities and shareholders’ equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 23,104 | $ | 24,166 | |||
Air traffic liability | 167,627 | 131,414 | |||||
Other current liabilities | 145,262 | 121,314 | |||||
Total current liabilities | 335,993 | 276,894 | |||||
Long-term deferred income taxes | 48,916 | 33,216 | |||||
Deferred credits and other long-term liabilities | 26,739 | 27,239 | |||||
Shareholders’ equity: | |||||||
Common stock | 7 | 7 | |||||
Additional paid-in-capital | 515,331 | 504,527 | |||||
Treasury stock | (2,291 | ) | (1,151 | ) | |||
Retained earnings | 256,070 | 79,152 | |||||
Total shareholders’ equity | 769,117 | 582,535 | |||||
Total liabilities and shareholders’ equity | $ | 1,180,765 | $ | 919,884 |
Year Ended December 31, | |||||||
2013 | 2012 | ||||||
Operating activities: | |||||||
Net income | $ | 176,918 | $ | 108,460 | |||
Adjustments to reconcile net income to net cash provided by operations: | |||||||
Changes in fair value of open fuel hedge contracts | 265 | 46 | |||||
Equity based stock compensation, net | 5,689 | 4,327 | |||||
Allowance for doubtful accounts | 143 | 78 | |||||
Amortization of deferred gains, losses and debt issuance costs | (558 | ) | (830 | ) | |||
Depreciation and amortization | 31,947 | 15,256 | |||||
Deferred income tax benefit | 12,047 | 29,255 | |||||
Loss on disposal of assets | 525 | 956 | |||||
Gain on slot sale | — | (9,060 | ) | ||||
Capitalized interest | (214 | ) | (1,350 | ) | |||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | (461 | ) | (7,393 | ) | |||
Prepaid maintenance reserves | (24,058 | ) | (31,567 | ) | |||
Long-term deposits and other assets | (65,654 | ) | (68,248 | ) | |||
Accounts payable | (1,674 | ) | 8,452 | ||||
Air traffic liability | 36,226 | 19,134 | |||||
Other liabilities | 24,235 | 46,115 | |||||
Net cash provided by operating activities | 195,376 | 113,631 | |||||
Investing activities: | |||||||
Proceeds from sale of property and equipment | — | 14 | |||||
Proceeds from sale of slots | — | 9,060 | |||||
Pre-delivery deposits for flight equipment, net of refunds | (70,288 | ) | (12,626 | ) | |||
Purchase of property and equipment | (19,812 | ) | (23,771 | ) | |||
Net cash used in investing activities | (90,100 | ) | (27,323 | ) | |||
Financing activities: | |||||||
Proceeds from options exercised | 852 | 469 | |||||
Proceeds from sale and leaseback transactions | 6,900 | 12,540 | |||||
Payments to pre-IPO shareholders pursuant to tax receivable agreement | — | (26,905 | ) | ||||
Excess tax benefits from share-based compensation | 1,927 | 2,098 | |||||
Repurchase of common stock | (1,140 | ) | (1,022 | ) | |||
Net cash provided by (used in) financing activities | 8,539 | (12,820 | ) | ||||
Net increase in cash and cash equivalents | 113,815 | 73,488 | |||||
Cash and cash equivalents at beginning of period | 416,816 | 343,328 | |||||
Cash and cash equivalents at end of period | $ | 530,631 | $ | 416,816 | |||
Supplemental disclosures | |||||||
Cash payments for: | |||||||
Interest | $ | 29 | $ | 303 | |||
Taxes | $ | 85,705 | $ | 40,204 | |||
Non-cash transactions: | |||||||
Liability and equity related to tax receivable agreement | $ | (2,336 | ) | $ | (1,497 | ) | |
Capital expenditures funded by capital lease borrowings | $ | (3,234 | ) | $ | — |
Three Months Ended December 31, | ||||||||
Operating Statistics | 2013 | 2012 | Change | |||||
Available seat miles (ASMs) (thousands) | 3,675,972 | 2,956,150 | 24.3 | % | ||||
Revenue passenger miles (RPMs) (thousands) | 3,167,376 | 2,519,392 | 25.7 | % | ||||
Load factor (%) | 86.2 | 85.2 | 1.0 pts | |||||
Passenger flight segments (thousands) | 3,161 | 2,647 | 19.4 | % | ||||
Block hours | 60,596 | 49,625 | 22.1 | % | ||||
Departures | 22,957 | 19,908 | 15.3 | % | ||||
Operating revenue per ASM (RASM) (cents) | 11.43 | 11.10 | 3.0 | % | ||||
Average yield (cents) | 13.26 | 13.03 | 1.8 | % | ||||
Average ticket revenue per passenger flight segment ($) | 77.98 | 71.30 | 9.4 | % | ||||
Average non-ticket revenue per passenger flight segment ($) | 54.88 | 52.73 | 4.1 | % | ||||
Total revenue per passenger flight segment ($) | 132.86 | 124.03 | 7.1 | % | ||||
CASM (cents) | 9.57 | 10.02 | (4.5 | )% | ||||
Adjusted CASM (cents) (1) | 9.67 | 10.03 | (3.6 | )% | ||||
Adjusted CASM ex-fuel (cents) (2) | 5.78 | 5.93 | (2.5)% | |||||
Fuel gallons consumed (thousands) | 45,100 | 36,670 | 23.0 | % | ||||
Average economic fuel cost per gallon ($) | 3.17 | 3.31 | (4.2 | )% | ||||
Aircraft at end of period | 54 | 45 | 20.0 | % | ||||
Average daily aircraft utilization (hours) | 12.5 | 12.6 | (0.8 | )% | ||||
Average stage length (miles) | 998 | 932 | 7.1 | % | ||||
Airports served in the period (3) | 53 | 53 | — | % |
Year Ended December 31, | ||||||||
Operating Statistics | 2013 | 2012 | Change | |||||
Available seat miles (ASMs) (thousands) | 13,861,393 | 11,344,731 | 22.2 | % | ||||
Revenue passenger miles (RPMs) (thousands) | 12,001,088 | 9,663,721 | 24.2 | % | ||||
Load factor (%) | 86.6 | 85.2 | 1.4 | pts | ||||
Passenger flight segments (thousands) | 12,414 | 10,423 | 19.1 | % | ||||
Block hours | 231,148 | 192,403 | 20.1 | % | ||||
Departures | 90,284 | 78,582 | 14.9 | % | ||||
Operating revenue per ASM (RASM) (cents) | 11.94 | 11.62 | 2.8 | % | ||||
Average yield (cents) | 13.79 | 13.64 | 1.1 | % | ||||
Average ticket revenue per passenger flight segment ($) | 79.43 | 75.11 | 5.8 | % | ||||
Average non-ticket revenue per passenger flight segment ($) | 53.84 | 51.39 | 4.8 | % | ||||
Total revenue per passenger flight segment ($) | 133.27 | 126.50 | 5.4 | % | ||||
CASM (cents) | 9.90 | 10.09 | (1.9 | )% | ||||
Adjusted CASM (cents) (1) | 9.89 | 10.15 | (2.6 | )% | ||||
Adjusted CASM ex-fuel (cents) (2) | 5.91 | 6.00 | (1.5 | )% | ||||
Fuel gallons consumed (thousands) | 171,931 | 142,991 | 20.2 | % | ||||
Average economic fuel cost per gallon ($) | 3.21 | 3.30 | (2.7 | )% | ||||
Average daily aircraft utilization (hours) | 12.7 | 12.8 | (0.8 | )% | ||||
Average stage length (miles) | 958 | 909 | 5.4 | % | ||||
Airports served in the period (3) | 56 | 55 | 1.8 | % |
(1) | Excludes unrealized mark-to-market gains and special items as described in the “Reconciliation of Adjusted Net Income to GAAP Net Income” table below. |
(2) | Excludes all components of fuel expense, including realized and unrealized mark-to-market hedge (gains) and losses, and special items as described in the “Reconciliation of Adjusted Net Income to GAAP Net Income” table below. |
(3) | Includes airports served during the period that had service canceled as of the end of the period. Previously, we reported only airports served during the period with continuing operations. |
Three Months Ended | Year Ended | ||||||||||||||
December 31, | December 31, | ||||||||||||||
(in thousands, except per share data) | 2013 | 2012 | 2013 | 2012 | |||||||||||
Net income, as reported | $ | 43,193 | $ | 19,566 | $ | 176,918 | $ | 108,460 | |||||||
Add: Provision for income taxes | 24,930 | 12,431 | 105,492 | 66,124 | |||||||||||
Income before income taxes, as reported | 68,123 | 31,997 | 282,410 | 174,584 | |||||||||||
Pre-tax margin, GAAP | 16.2 | % | 9.7 | % | 17.1 | % | 13.2 | % | |||||||
Add: Unrealized mark-to-market (gains) and losses(1) | (3,224 | ) | (414 | ) | 265 | 46 | |||||||||
Add special items (2): | |||||||||||||||
Loss on disposal of assets | 99 | 474 | 525 | 956 | |||||||||||
Special charges (credits) | (314 | ) | (105 | ) | 174 | (8,450 | ) | ||||||||
Income before income taxes, non-GAAP (3) | 64,684 | 31,952 | 283,374 | 167,136 | |||||||||||
Pre-tax margin, non-GAAP (3) | 15.4 | % | 9.7 | % | 17.1 | % | 12.7 | % | |||||||
Provision for income taxes (4) | 23,671 | 12,414 | 105,852 | 63,303 | |||||||||||
Adjusted net income, non-GAAP (3) | $ | 41,013 | $ | 19,538 | $ | 177,522 | $ | 103,833 | |||||||
Weighted average shares, basic | 72,658 | 72,442 | 72,593 | 72,386 | |||||||||||
Weighted average shares, diluted | 73,195 | 72,623 | 72,999 | 72,591 | |||||||||||
Adjusted net income per share, basic | $ | 0.56 | $ | 0.27 | $ | 2.45 | $ | 1.43 | |||||||
Adjusted net income per share, diluted | $ | 0.56 | $ | 0.27 | $ | 2.43 | $ | 1.43 |
(1) | Unrealized mark-to-market (gains) and losses are comprised of non-cash adjustments to aircraft fuel expense. |
(2) | Special items include loss on disposal of assets and special charges (credits). Special charges (credits) for 2012 include: (i) recognition of a gain on the sale of four carrier slots at Ronald Reagan National Airport, and (ii) offering costs related to the sale of 12.1 million shares of common stock by certain stockholders affiliated with Indigo Partners LLC. |
(3) | Excludes unrealized mark-to-market (gains) and losses and special items. |
(4) | Assumes same marginal tax rate as is applicable to GAAP net income. |
Three Months Ended | Year Ended | ||||||||||||||
December 31, | December 31, | ||||||||||||||
(in thousands, except CASM data in cents) | 2013 | 2012 | 2013 | 2012 | |||||||||||
Total operating expenses, as reported | $ | 351,923 | $ | 296,335 | $ | 1,372,093 | $ | 1,144,398 | |||||||
Less: Unrealized mark-to-market (gains) and losses | (3,224 | ) | (414 | ) | 265 | 46 | |||||||||
Less special items: | |||||||||||||||
Loss on disposal of assets | 99 | 474 | 525 | 956 | |||||||||||
Special charges (credits) | (314 | ) | (105 | ) | 174 | (8,450 | ) | ||||||||
Operating expenses, non-GAAP (1) | 355,362 | 296,380 | 1,371,129 | 1,151,846 | |||||||||||
Less: Economic fuel expense, non-GAAP | 143,067 | 121,203 | 551,481 | 471,717 | |||||||||||
Operating expenses excluding fuel, non-GAAP (1) (2) | $ | 212,295 | $ | 175,177 | $ | 819,648 | $ | 680,129 | |||||||
Available seat miles | 3,675,972 | 2,956,150 | 13,861,393 | 11,344,731 | |||||||||||
CASM (cents) | 9.57 | 10.02 | 9.90 | 10.09 | |||||||||||
Adjusted CASM (cents) (1) | 9.67 | 10.03 | 9.89 | 10.15 | |||||||||||
Adjusted CASM ex-fuel (cents) (2) | 5.78 | 5.93 | 5.91 | 6.00 |
Three Months Ended | Year Ended | ||||||||||||||
December 31, | December 31, | ||||||||||||||
(in thousands) | 2013 | 2012 | 2013 | 2012 | |||||||||||
Operating income, as reported | $ | 68,061 | $ | 31,933 | $ | 282,292 | $ | 173,990 | |||||||
Operating margin, GAAP | 16.2 | % | 9.7 | % | 17.1 | % | 13.2 | % | |||||||
Add: Unrealized mark-to-market (gains) and losses | (3,224 | ) | (414 | ) | 265 | 46 | |||||||||
Add special items: | |||||||||||||||
Loss on disposal of assets | 99 | 474 | 525 | 956 | |||||||||||
Special charges (credits) | (314 | ) | (105 | ) | 174 | (8,450 | ) | ||||||||
Operating income, non-GAAP (1) | $ | 64,622 | $ | 31,888 | $ | 283,256 | $ | 166,542 | |||||||
Operating margin (1) | 15.4 | % | 9.7 | % | 17.1 | % | 12.6 | % |
(1) | Excludes unrealized fuel hedge (gains) and losses and special items as described in the "Reconciliation of Adjusted Net Income to GAAP Net Income" table above. |
(2) | Excludes all components of fuel expense, including realized and unrealized fuel hedge (gains) and losses, and special items as described in the “Reconciliation of Adjusted Net Income to GAAP Net Income” table above. |
Three Months Ended | Year Ended | ||||||||||||||
December 31, | December 31, | ||||||||||||||
(in thousands, except per gallon data) | 2013 | 2012 | 2013 | 2012 | |||||||||||
Fuel Expense | |||||||||||||||
Aircraft fuel, as reported | $ | 139,843 | $ | 120,789 | $ | 551,746 | $ | 471,763 | |||||||
Less: Unrealized mark-to-market (gains) and losses (1) | (3,224 | ) | (414 | ) | 265 | 46 | |||||||||
Economic fuel expense, non-GAAP | $ | 143,067 | $ | 121,203 | $ | 551,481 | $ | 471,717 | |||||||
Fuel gallons consumed | 45,100 | 36,670 | 171,931 | 142,991 | |||||||||||
Economic fuel cost per gallon, non-GAAP | $ | 3.17 | $ | 3.31 | $ | 3.21 | $ | 3.30 |
Twelve Months Ended | ||||
(in thousands) | December 31, 2013 | |||
Operating Income | $ | 282,292 | ||
Add: Unrealized mark-to-market losses (1) | 265 | |||
Add special items: | ||||
Special charges (credits) | 174 | |||
Loss on disposal of assets | 525 | |||
Adjustment for aircraft rent | 169,737 | |||
Adjusted Operating Income (2) | $ | 452,993 | ||
Tax (37.4%) (3) | 169,419 | |||
Adjusted Operating Income, after-tax | $ | 283,574 | ||
Invested Capital | ||||
Total debt | $ | — | ||
Book equity | 769,117 | |||
Less: Unrestricted cash | 530,631 | |||
Add: Capitalized aircraft operating leases (7x Aircraft Rent) | 1,188,159 | |||
Total Invested Capital | $ | 1,426,645 | ||
Return on Invested Capital (ROIC), pre-tax | 31.8 | % | ||
Return on Invested Capital (ROIC), after-tax | 19.9 | % |
(1) | Unrealized mark-to-market (gains) and losses are comprised of non-cash adjustments to aircraft fuel expenses. |
(2) | Excludes unrealized mark-to-market (gains) and losses and special items as described in the “Reconciliation of Adjusted Net Income to GAAP Net Income” table above. |
(3) | Assumes same marginal tax rate as is applicable to GAAP net income for the year ended December 31, 2013. |
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