SkyWest Inc. made good Wednesday on its prediction that the airline would post its first quarterly loss in nearly a quarter-century.
The St. George-based regional airline lost $11.1 million, or 21 cents per share, in the three months ending March 31. It earned $15 million, or 26 cents per share, in the same months of last year.
Chief Financial Officer Brad Rich pinned much of the loss on severe winter storms in January and February that grounded aircraft and stranded crews, sometimes for days.
"This is the first time in 91 consecutive quarters that SkyWest has reported a net loss. I think that's got to be close to 23 years," Rich said in a conference call with securities analysts.
He painted the loss as an aberration that he also blamed on in-depth inspections of unusual numbers of aircraft airframes. The cost to inspect the airframes was higher than expected, he said.
"This is not what we expect to produce," Rich said of the quarterly results, "and I do not think that it is reflective of our future potential."
In April, SkyWest said it expected to post a $10 million to $15 million loss in the quarter because of weather and other factors. In another conference call in February, Rich also hinted to analysts that first-quarter earnings would be soft.
Although SkyWest lost money in the quarter, it brought in more revenue. Receipts increased to $866 million, compared with $632.2 million in the first quarter of 2010. Rich said almost all the increase was the result of buying ExpressJet Holdings and its ExpressJet subsidiary last November.
SkyWest Inc. is the parent company of SkyWest Airlines and Atlantic Southeast Airlines (ASA). ExpressJet became a subsidiary of ASA after the ExpressJet acquisition closed in November.
SkyWest Airlines and ASA fly as Delta Connection on behalf of Delta Air Lines and as United Express for United Continental Holdings Inc.
Most of SkyWest's flying is under contract for Delta and United, which reimburse the company for jet-fuel expenses. Lately, however, SkyWest has been expanding its "pro-rate" operations, in which it takes on more responsibility for costs such as fuel.
SkyWest ran up an extra $6.1 million in fuel costs during the quarter.
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