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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Act of 1934
Date of Report (date of earliest event reported) October 13, 1999
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AirTran Holdings, Inc.
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(Exact name of registrant as specified in its charter)
Nevada 0-26914 58-2189551
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(State or other (Commission (I.R.S. Employer
jurisdiction File Number) Identification No.)
of incorporation)
9955 AirTran Boulevard, Orlando, Florida 32827
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (407) 251-5600
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(Former name or former address, if changed since last report.)
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ITEM 5. OTHER EVENTS
On October 13, 1999, AirTran Holdings, Inc. (the "Company") announced
its results for third quarter 1999. A copy of the press release is
filed as an Exhibit to this report on Form 8-K.
Item 7. Financial Statements and Exhibits
(c) Exhibits. The following exhibit is furnished as a part of this
Report. Exhibit numbers refer to Item 601 of Regulation S-K.
99-Press Release issued on October 13,1999.
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.
AIRTRAN HOLDINGS, INC.
October 13, 1999 By: /s/ Robert L. Fornaro
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Robert L. Fornaro
Chief Financial Officer
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FOR RELEASE 8:00 a.m. EST Contacts: (Financial) David Lancelot
Wednesday, October 13, 1999 407/251-3609
(Media) Cara Maruskin
407/251-5578
AirTran Holdings Reports Third Consecutive Quarterly Profit
Earnings Per Share Increases 51 Cents Over Last Year
ORLANDO, Fla. (October 13, 1999) - AirTran Holdings (Nasdaq:AAIR) today reported
pre-tax income for the third quarter of 1999 of $4.5 million, excluding a
special gain from the settlement of its lawsuit against SabreTech, compared to a
pre-tax loss of $10.9 million for the third quarter of 1998. Including the
special gain, AirTran reported net income of $23.2 million or 34 cents earnings
per diluted share, an increase of 51 cents per diluted share from the third
quarter 1998.
AirTran reported pre-tax income of $24.1 million for the third quarter of
1999, compared to a pre-tax loss of $10.9 million for the same quarter in 1998.
Including the special gain, net income for the first nine months of 1999
improved by $51.4 million to $ 41.2 million or 60 cents per diluted share,
compared to a net loss of $10.2 million or a 16 cent loss per diluted share for
the same period a year ago.
"We were able to produce some respectable results in the third quarter
while enduring a more challenging operating environment. I am pleased that we
continue to make progress on unit revenue production as well as reducing our
unit costs," said Joe Leonard, AirTran's chairman and chief executive officer.
"It is particularly satisfying to put three consecutive profitable quarters
together."
Passenger revenue increased by $9.1 million or 8.2 percent in the third
quarter of 1999, compared to a year ago as the airline continues to improve its
unit revenues. Revenue per available seat mile increased 12.7 percent while
yield increased 5.5 percent versus the third quarter of 1998. Severe weather as
a result of Hurricane Floyd is estimated to have cost the airline in excess of
$2 million in revenue during the quarter.
Operating expenses for the third quarter decreased by $6.5 million or 5.4
percent despite service interruptions in early July as a result of extra engine
changes and the effects of Hurricane Floyd. AirTran's operating cost per
available seat mile was 8.44 cents compared to 8.55 a year ago.
AirTran ended the quarter with $55.2 million in cash, an improvement of
$30.8 million from the beginning of the year. EBITDA, excluding the special
gain from the settlement, improved by $38 million to $64.8 million for the nine
months ended September 30, 1999.
During the third quarter 1999, AirTran experienced a number of significant
successes including:
. Newark, N.J. service initiated July 1, with four flights per day to
Atlanta. The company's initial performance in this important business market
has exceeded expectations.
(more)
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AirTran Holdings Reports Third Consecutive Quarterly Profit - page 2 of 2
. In August, the Department of Transportation's domestic airline fares
consumer report contained a section highlighting the positive effects of
low-fare competition in the airline industry. The special section
focused on AirTran's significant impact on traffic and fares in the
Atlanta market.
. Later in August, AirTran was awarded 39 GSA (General Service
Administration) Air Passenger Transportation Services contracts, valued
in excess of $8 million by the United States Government. The contracts
provide for official government transportation between specific city
pairs. The contract period runs from October 1, 1999, to September 30,
2000.
. In September, AirTran introduced Boeing's newest product, the B-717-
200 by taking delivery of the first two of 50 aircraft on order. AirTran
will operate its two new B-717s in scheduled service beginning in mid-
October. The aircraft are initially scheduled to serve Boston, Fort
Lauderdale, Orlando, Tampa and Washington-Dulles. AirTran will take
delivery of six more B-717s during the fourth quarter of 1999.
. The Atlanta Airport Authority and AirTran have reached an agreement on
expansion plans for Hartsfield International Airport, which will
increase AirTran's gates on concourse C from 18 to 22, and should be
completed during January 2000.
. The Florida and Missouri lawsuits between AirTran and SabreTech were
settled by a cash payment to AirTran. None of the parties to the lawsuit
admitted any fault or liability. The other terms of this settlement
agreement and release are strictly confidential.
Offering the convenience of easy, same concourse connections in
Atlanta, systemwide, AirTran operates over 275 daily departures to 30 cities.
AirTran operates over 130 daily departures from Atlanta Hartsfield, the "World's
Busiest Airport," as designated by Airports Council International.
AirTran provides everyday, affordable air travel throughout the
eastern United States and Midwest. Unlike other airlines, AirTran never requires
a roundtrip purchase or Saturday night stay. AirTran is the launch customer for
the new Boeing 717, the newest, most innovative commercial aircraft to date.
For more information and reservations, call your travel agent, 800-
AIRTRAN (800-247-8726), 770-994-8258 (in Atlanta), or visit the AirTran website
at www.airtran.com.
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Note: Statements regarding quarter over quarter improvements, future
profitability, improved unit revenue production, reduced unit costs, B-717
delivery schedule, gate expansion in Atlanta, and value of GSA contracts are
forward-looking statements and are not historical facts. Instead, they are
estimates or projections involving numerous risks or uncertainties, including
but not limited to consumer demand and acceptance of services offered by the
Company, the Company's ability to maintain current cost levels, fare levels and
actions by competitors, regulatory matters and general economic conditions. The
Company disclaims any obligation or duty to update or correct any of its
forward-looking statements.
Statement of Operations To Follow...
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AirTran Holdings, Inc.
Consolidated Statement of Operations
(In thousands, except per share data and statistical summary)
(Unaudited)
<TABLE>
<CAPTION>
For three months ended For the nine months ended
September 30, September 30,
1999 1998 1999 1998
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<S> <C> <C> <C> <C>
Operating revenues:
Passenger $ 119,676 $ 110,575 $ 370,636 $ 319,856
Cargo 933 740 2,899 2,302
Other 22,874 3,745 29,836 11,431
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Total operating revenues 143,483 115,060 403,371 333,589
Operating expenses:
Salaries wages and benefits 30,358 30,666 87,408 81,108
Aircraft fuel 18,888 19,321 50,237 55,112
Maintenance, materials and repairs 20,114 21,920 69,278 52,154
Commissions 9,191 8,221 28,595 26,284
Landing fees and other rents 6,531 7,521 19,542 20,556
Marketing and advertising 3,113 3,575 13,120 12,305
Aircraft rent 1,262 1,921 3,908 5,701
Depreciation 8,790 7,109 24,433 20,337
Other operating 15,666 19,809 46,824 53,443
Loss on disposal of property - 316 - 361
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Total operating expenses 113,913 120,379 343,345 327,361
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Operating income (loss) 29,570 (5,319) 60,026 6,228
Interest (income) expense
Interest income (763) (779) (1,688) (2,683)
Interest expense 6,218 6,367 18,120 19,118
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Interest (income) expense, net 5,455 5,588 16,432 16,435
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Income (loss) before income taxes 24,115 (10,907) 43,594 (10,207)
Income tax expense (benefit) 948 (14) 2,414 -
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Net income (loss) $ 23,167 $ (10,893) $ 41,180 $ (10,207)
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Basic earnings (loss) per share $ 0.36 $ (0.17) $ 0.63 $ (0.16)
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Diluted earnings (loss) per share $ 0.34 $ (0.17) $ 0.60 $ (0.16)
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*Statistical summary:
Revenue passengers enplaned 1,598,238 1,416,865 4,861,099 4,045,695
Revenue passenger miles (000's) 864,947 842,698 2,618,141 2,480,993
Available seat miles (000's) 1,350,183 1,407,496 4,086,444 4,105,048
Load factor 64.06 % 59.87 % 64.07 % 60.44 %
Break-even load factor 61.67 % 65.78 % 59.93 % 62.36 %
Average fare $74.88 $78.04 $76.25 $79.06
Passenger yield per RPM (cents) 13.84 c 13.12 c 14.16 c 12.89 c
Passenger revenue per ASM 8.86 c 7.86 c 9.07 c 7.79 c
Operating cost per ASM 8.44 c 8.55 c 8.40 c 7.97 c
Average cost of aircraft fuel per gallon 54.92 c 55.46 c 48.97 c 56.23 c
EBITDA 18,720 1,790 64,819 26,565
Operating Margin 8.02 % (4.62)% 10.52 % 1.87 %
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* Statistical data does not include settlement gain.
