The majority of North and South American carriers saw stocks slide on Wednesday (04-Nov-2009), as oil prices (+0.7%) made gains, to USD80.14, and a number of carriers released 3Q2009 financial results and Oct-2009 traffic results. As a result, the AMEX Airline Index fell 0.3%, despite a slight increase in the wider market, with the Dow up 0.3%.
Republic Airways (-1.6%) saw an 80.8% decline in net income for 3Q2009, reporting a net profit of USD3.3 million. The results include Aug-2009 and Sep-2009 results for Midwest Airlines, which was acquired on 31-Jul-2009. The decline in profit was the result of a 39.2% fall in operating income, as costs were reduced only 0.6% during the period, as operating revenue fell 6.7%.
US Airways (-0.3%) reported a 3.3% year-on-year decline in passenger numbers in Oct-2009, to 4.9 million passengers. However, load factors improved 1.0% overall, on the back of a 1.7% reduction in capacity (ASMs) and a 0.6% drop in traffic (RPMs).
According to the carrier, consolidated passenger revenue per ASM (PRASM) dropped approximately 10% year-on-year, while total RASM declined approximately 9%. President, Scott Kirby, stated that despite the declines, “the revenue outlook continues to show material signs of improvement with continued strength in both close-in bookings and yields."
Meanwhile, competitor American Airlines (-2.1%) reported after trading a 4.2% fall in passenger numbers, to 7.1 million passengers. However, load factor rose 4.0 ppts, to 83.1%, following a 2.6% decline in traffic and 7.3% decline in capacity.
WestJet (+0.9%) stocks rose despite the carrier reporting during trading a 45.7% fall in net earnings in 3Q2009, to CAD31.4 million (USD29.5 million) or CAD0.24 (USD0.23) per diluted share.
The carrier saw yield for the quarter drop 13.7% to CAD0.17 (USD0.16), while RASM fell 15.5%, to CAD0.13 (USD0.12).
President and CEO, Sean Durfy, attributed the carrier’s profits to “relief from significantly lower fuel costs” and its “ability to successfully stimulate demand while keeping our controllable costs in line played an important part in our strong margins".
WestJet also saw an improvement in load factor in Oct-2009, up 1.5 ppts, to 77.3%, following a slight improvement in traffic (+0.3%) and reduction in capacity (1.8%).
Meanwhile, Air Canada (+0.9%) saw its load factor for the same period fall 0.6%, to 79.6%, as traffic fell 1.3% and capacity was reduced only 0.5%.
ExpressJet (-21.2%) meanwhile saw stocks plummet after reporting a 3Q2009 loss of USD9 million, compared to a net profit of USD4.4 million in 3Q2008. However, excluding special items, the carrier reported a loss of USD7.7 million or USD0.52 per common share. These results reflect a year-on-year improvement, after the carrier reported a loss of USD15.8 million or USD1.00 per common share, excluding special items in 3Q2008.
President and CEO, Jim Ream stated "going forward, our results will get better as the utilization of our fleet returns to pre-recessionary levels, and we remain very positive in our ability to attract new customers in both our contract and corporate aviation divisions."
Meanwhile, each of the leading Latin American carriers' stocks rose, GOL (+3.4%), TAM (+2.7%) and LAN Airlines (+2.3%).
North & South America selected airlines daily share price movements (% change): 04-Nov-09
Want more analysis like this? CAPA Membership gives you access to all news and analysis on the site, along with access to many areas of our comprehensive databases and toolsets.
Find out more and take a free trial.