SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934
July 16, 1998
(Date of earliest event reported)
AMTRAN, INC.
(Exact name of registrant as specified in its charter)
INDIANA 000-21642 35-1617970
(State or Other (Commission File (IRS Employer
Jurisdiction Number) Identification Number)
of Incorporation)
7337 West Washington Street, Indianapolis, Indiana
46231
(Zip Code)
(317) 247-4000
(Registrant's telephone number, including area code)
None
(Former Name or Former Address, if Changed Since Last Report)
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Item 5. Other Events.
Attached as Exhibit 99(d) to this report is a press release
dated July 16, 1998 discussing Amtran, Inc.'s second quarter
earnings.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Amtran, Inc.
(Registrant)
Date: July 17, 1998 By: Kenneth K. Wolff
----------------------------- -------------------------
(Signature)
Name: Kenneth K. Wolff
Title: Executive Vice President and
Chief Financial Officer
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EXHIBIT INDEX
Exhibit Description Page
99(d) Press Release dated July 16, 1998. 6
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Exhibit 99(d)
Investor Relations Contacts: Kenneth K. Wolff, Chief
Financial Officer, (317) 240-7087
Kim Wick, Manager, Investor
Relations, (317) 240-7602
Media Contact: Mary Cochran (317) 240-7473
AMTRAN REPORTS RECORD BREAKING QUARTER
Second Quarter Earnings Per Share (diluted) $1.05 compared
with Loss Per Share $0.06
INDIANAPOLIS, IN July 16, 1998 -- Amtran, Inc. (Nasdaq/NNM: "AMTR"), parent
company of American Trans Air, Inc. (ATA), today reported a record second
quarter net income of $13.8 million, compared with a net loss of $749,000 in the
second quarter of 1997. This is the second consecutive quarter of record
earnings for Amtran.
Second Quarter Financial Results:
For the three months ended June 30, 1998, Amtran had record operating income of
$24.6 million, compared with $1.0 million in the second quarter of 1997. Net
income was $13.8 million, equal to $1.19 basic and $1.05 diluted earnings per
share, compared with a net loss of $749,000, or $0.06 basic and diluted loss per
share in the second quarter of 1997.
Total operating revenues increased 24.1% to a record $238.5 million from $192.2
million in the comparable period a year ago. Scheduled service revenues
increased 50.7% to $131.6 million from $87.3 million, and charter service
revenues decreased 2.7% to $90.5 million from $93.0 million. Total operating
expenses increased 11.8% to $213.8 million, compared with $191.2 million in the
prior year.
Second Quarter Operating Results:
For the three months ended June 30, 1998, system-wide revenue passenger miles
(RPMs) increased 13.3% to 2.5 billion, and available seat miles (ASMs) increased
13.0% to 3.5 billion. Operating revenue per ASM (RASM) increased 9.9% to 6.80
cents, compared with 6.19 cents in the 1997 second quarter. Operating costs
decreased 1.0% to 6.10 cents per ASM, compared with 6.16 cents in 1997.
For ATA's scheduled service, RPMs increased 33.4% to 1.5 billion, ASMs increased
30.7% to 1.9 billion, and passenger load factor increased 1.6 points to 78.0%.
Scheduled service RASM improved 15.3% to 6.86 cents and yields improved 13.0% to
8.80 cents from 7.79 cents. For its charter service, RPMs decreased 13.6% to
933.8 million; ASMs decreased 7.8% to 1.5 billion; and block hours flown
decreased 12.0% to 12,771. Charter RASM increased 5.6% to $6.03 cents. ATA flew
992 subservice block hours in the second quarter of 1998, compared with 119
block hours in 1997.
President's Comments:
John Tague, Amtran's President and Chief Executive Officer, commented: "This
time last year, ATA put a plan in place to improve several key areas of its
business. This included improving our unit revenues across all business
segments, increasing aircraft utilization, reallocating capacity to higher
return markets and controlling unit costs. The results of the second quarter and
first six months of 1998 are strong endorsements of our efforts. The Company's
previous net income record for the second quarter was $3.3 million in 1995 - 25%
of what we achieved this year. Beginning with the fourth quarter of 1997, we
have shown substantial improvement in our year-over-year performance,
demonstrated much greater earnings consistency, and produced nine months of
record financial performance."
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Amtran Reports Second Quarter Page 2
Year-To-Date Financial Results:
For the six months ended June 30, 1998, Amtran had record operating income of
$48.1 million, compared with $8.7 million in the same period a year ago. Net
income was $26.2 million, equal to $2.26 basic and $2.07 diluted earnings per
share, compared with $2.5 million, or $0.21 basic and diluted earnings per share
in 1997.
In the first six months of 1998, total operating revenues increased 21.0% to a
record $467.8 million from $386.5 million in the comparable period a year ago.
Scheduled service revenues increased 47.4% to $249.5 million from $169.3
million, and charter service revenues decreased 4.4% to $184.8 million from
$193.4 million. Total operating expenses increased 11.1% to $419.7 million,
compared with $377.7 million in the prior year.
Year-To-Date Operating Results:
For the six months ended June 30, 1998, system-wide revenue passenger miles
(RPMs) increased 10.8% to 4.9 billion, and available seat miles (ASMs) increased
12.8% to 6.9 billion. Operating revenue per ASM increased 7.2% to 6.81 cents,
compared with 6.35 cents in the 1997 second quarter. Operating costs decreased
1.6% to 6.11 cents per ASM, compared with 6.21 cents in 1997.
For ATA's scheduled service, RPMs increased 34.8% to 2.8 billion, ASMs increased
34.0% to 3.6 billion and passenger load factor increased 0.5 points to 76.5%.
Scheduled service RASM increased 10.1% to 6.84 cents and yields improved 9.4% to
8.94 cents from 8.17 cents. For its charter service, RPMs decreased 14.7% to 2.0
billion; ASMs decreased 9.0% to 3.0 billion; and block hours flown decreased
13.2% to 26,407. Charter RASM improved 5.0% to 6.06 cents. ATA flew 1,877
subservice block hours in the first six months of 1998, compared with 232 block
hours in 1997.
ATA, in its 25th year, operates a fleet of 45 aircraft, including Boeing 727s,
Boeing 757s and Lockheed L-1011s, which is supported by the Company's own
maintenance and engineering facilities in Indianapolis and Chicago-Midway and
maintenance support stations worldwide. Amtran's common stock trades on the
NASDAQ Stock Market under the symbol "AMTR."
This press release contains forward-looking statements that incorporate
assumptions which entail uncertainties and unknown risks. Important factors that
could cause actual results to differ materially from those indicated by such
forward-looking statements are set forth under the caption "Forward-Looking
Statements" in the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1997. These factors include, among others, the following:
general economic factors affecting the industry and the Company; fuel prices;
competition within the industry; changes in consumer preferences; regulatory
changes; and economic conditions in key markets.
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Amtran Reports Second Quarter Page 3
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AMTRAN, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
Dollars in thousands, except per share amounts
Three Months Ended Six Months Ended
June 30, June 30,
1998 1997 1998 1997
-----------------------------------------------------------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Operating revenues:
<S> <C> <C> <C> <C>
Scheduled service $ 131,594 $ 87,253 $ 249,483 169,257
Charter service 90,492 93,019 184,814 193,365
Other 16,378 11,915 33,472 23,849
--------------- ------------ --------------------------
Total operating revenues 238,464 192,187 467,769 386,471
Operating expenses:
Salaries, wages and benefits 52,607 43,917 102,353 84.407
Fuel and oil 35,307 36,399 72,085 77,070
Depreciation and amortization 21,523 15,296 39,681 29,436
Handling, landing and navigation fees 17,772 17,214 35,277 34,462
Aircraft maintenance, materials and repairs 14,380 13,840 27,195 24,925
Aircraft rentals 12,923 14,137 25,849 28,284
Crew and other employee travel 10,497 9,386 19,888 17,306
Passenger services 8,509 7,588 16,712 15,774
Other 40,302 33,389 80,676 66,058
--------------- ------------ --------------------------
Total operating expenses 213,820 191,166 419,716 377,722
--------------- ------------ --------------------------
Operating income 24,644 1,021 48,053 8,749
Other income (expense):
Interest income 1,176 79 2,218 225
Interest expense (3,213) (1,708) (6,467) (3,320)
Other 42 128 116 183
----------------------------- --------------------------
Other expenses (1,995) (1,501) (4,133) (2,912)
----------------------------- --------------------------
Income before income taxes 22,649 (480) 43,920 5,837
Income tax expense 8,854 269 17,726 3,364
----------------------------- --------------------------
Net income $ 13,795 $ (749) $ 26,194 2,473
============================= ==========================
Basic earnings per common share:
Average shares outstanding; 11,624,356 11,575,653 11,595,050 11,573,761
Net income per share $ 1.19 $ (.06) $ 2.26 0.21
============================= ==========================
Diluted earnings per common share:
Average shares outstanding; 13,159,403 11,575,653 12,631,404 11,798,161
Net income per share $ 1.05 $ (.06) $ 2.07 0.21
============================= ==========================
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Amtran Reports Second Quarter Page 4
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AMTRAN, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
Dollars, in thousands
June 30, December 31,
1998 1997
------------------------------------------------------------------
<S> <C> <C>
Cash and cash equivalents 112,270 104,196
Total current assets 177,514 162,842
Property and equipment, net 294,938 267,681
Other assets 20,041 20,334
Total assets 492,493 450,857
Current liabilities 181,918 168,352
Long-term debt 172,150 182,829
Other liabilities 54,538 42,686
Shareholders' equity 83,887 56,990
Total liabilities and shareholders' equity 492,493 450,857
AMTRAN, INC. AND SUBSIDIARIES
OPERATING STATISTICS
System-wide Three Months Ended Six Months Ended
June 30, June 30,
1998 1997 1998 1997
------------------------------------------------------------------
Total
Revenue passenger miles (000s) 2,499,337 2,205,356 4,893,832 4,415,417
Available seat miles (000s) 3,507,906 3,105,148 6,870,936 6,090,142
Revenue passengers carried 1,614,422 1,343,698 3,175,401 2,750,826
Average passenger trip length (miles) 1,548 1,641 1,541 1,605
Block hours flown 40,738 34,703 79,895 65,672
Operating revenue per ASM (cents) 6.80 6.19 6.81 6.35
Operating cost per ASM (cents) 6.10 6.16 6.11 6.21
Gallons of fuel consumed (thousands) 57,557 50,941 112,156 100,381
Charter Service
Revenue passenger miles (000s) 933,794 1,080,568 1,993,870 2,337,010
Available seat miles (000s) 1,501,673 1,628,808 3,048,088 3,349,969
Revenue passengers carried 466,141 557,235 1,033,611 1,275,439
Average passenger trip length (miles) 2,003 1,939 1,929 1,832
Block hours flown 12,771 14,509 26,407 30,439
Scheduled Service
Revenue passenger miles (000s) 1,495,069 1,120,499 2,791,942 2,070,657
Available seat miles (000s) 1,917,358 1,467,289 3,648,340 2,723,608
Passenger load factor 78.0% 76.4% 76.5% 76.0%
Revenue passengers carried 1,099,516 783,364 2,073,631 1,469,860
Average passenger trip length (miles) 1,360 1,430 1,346 1,409
Block hours flown 26,975 20,075 51,610 35,001
Operating revenue per RPM (cents) 8.80 7.79 8.94 8.17
Sub-service
Block Hours
Block hours flown 992 119 1,877 232
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Amtran Reports Second quarter Page 5
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ATA Connection (Contract Commuter) Three Months Ended Six Months Ended
June 30, June 30,
Scheduled Service 1998 1997 1998 1997
----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Revenue passenger miles (000s) 8,122 6,046 14,234 6,046
Available seat miles (000s) 13,278 9,856 25,218 9,856
Passenger load factor 61.2% 61.3% 56.4% 61.3%
Revenue passengers carried 46,455 31,573 80,785 31,573
Average passenger trip length (miles) 175 191 176 191
Block hours flown 3,975 3,129 7,525 3,129
ATA Jet Operations
Total
Revenue passenger miles (000s) 2,491,215 2,199,310 4,879,598 4,409,371
Available seat miles (000s) 3,494,628 3,095,292 6,845,718 6,080,286
Revenue passengers carried 1,567,967 1,312,125 3,094,616 2,719,253
Average passenger trip length (miles) 1,589 1,676 1,577 1,622
Block hours flown 36,763 31,574 72,369 62,543
Charter Service
Revenue passenger miles (000s) 933,794 1,080,568 1,993,870 2,337,010
Available seat miles (000s) 1,501,673 1,628,808 3,048,088 3,349,969
Revenue passengers carried 466,141 557,235 1,033,611 1,275,439
Average passenger trip length (miles) 2,003 1,939 1,929 1,832
Block hours flown 12,771 14,509 26,407 30,439
Scheduled Service
Revenue passenger miles (000s) 1,486,947 1,114,453 2,777,708 2,064,611
Available seat miles (000s) 1,904,080 1,457,433 3,623,122 2,713,752
Passenger load factor 78.1% 76.5% 76.7% 76.1%
Revenue passengers carried 1,053,061 751,791 1,992,846 1,438,287
Average passenger trip length (miles) 1,412 1,482 1,394 1,435
Block hours flown 23,000 16,946 44,085 31,872
###
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