JetBlue Q4 Results Beat View, But Q1 Results To Be Hurt By Weather

(RTTNews) - Discount carrier JetBlue Airways Corp. (JBLU) on Wednesday reported a surge in profit for the fourth quarter from last year, reflecting higher traffic and revenue that was boosted by an increase in average fares.

Both revenue and earnings per share for the quarter beat analysts' estimates. However, the company expects first-quarter results to be hurt by severe weather in the Northeast in early January.

JetBlue's net income for the fourth quarter was $47 million or $0.14 per share, up from $1 million or breakeven per share in the year-ago period. On average, fifteen analysts polled by Thomson Reuters expected the company to report earnings of $0.13 per share for the quarter. Analysts' estimates typically exclude one-time items.

Operating revenues for the quarter increased 14 percent to $1.37 billion from $1.19 billion in the prior-year period. Analysts had a consensus revenue estimate of $1.35 billion.

During the quarter, JetBlue's traffic rose 7.1 percent to 8.65 billion revenue passenger miles, while capacity increased 8.3 percent to 10.69 billion available seat miles. Load factor for the quarter was 80.9 percent, a decrease of 1 percentage point year-over-year. Average fare rose 8.9 percent to $168.94.

Passenger revenue per available seat mile or PRASM, a key measure of efficiency, rose 5.3 percent to 11.62 cents, while operating expense per available seat mile or CASM increased 0.4 percent to 11.70 cents. Yield per passenger mile in the quarter was 14.35 cents, up 6.5 percent compared to the year-ago period.

Operating expenses for the quarter rose 9 percent to $1.25 billion, amid higher aircraft fuel and related taxes as well as increased expenses for salaries, wages and benefits. However, JetBlue's average realized fuel price in the quarter declined 3 percent from last year to $3.10 per gallon.

Operating margin for the quarter expanded 470 basis points from last year to 8.4 percent.

For fiscal 2013, JetBlue's net income rose to $168 million or $0.52 per share from $128 million or $0.40 per share in the previous year. Total revenues for the year grew 9 percent to $5.44 billion from $4.98 billion last year.

Looking ahead to the first quarter of 2014, JetBlue expects results to be hurt by severe weather in the Northeast in the start of January that resulted in the cancellation of nearly 1,800 flights. The company noted that the severe weather reduced total revenue for the quarter by an estimated $45 million and reduced operating income by about $30 million.

For the first quarter, JetBlue forecasts operating expense per available seat mile or CASM to increase between 0.0 percent and 2.0 percent compared to the year-ago period. Excluding fuel and profit sharing, the company projects CASM to grow between 3.0 percent and 5.0 percent year over year. First-quarter capacity is expected to increase between 2.5 percent and 4.5 percent.

For fiscal 2014, JetBlue forecasts CASM to increase between 1.0 percent and 3.0 percent over full year 2013. Excluding fuel and profit sharing, CASM is expected to increase between 3.0 percent and 5.0 percent year-on-year. Full-year capacity is anticipated to rise between 5.0 percent and 7.0 percent.

In Wednesday's regular session, JBLU is trading at $8.93, up $0.19 or 2.17 percent on a volume of 606,870 shares.