Alaska Air Group Reports Record First Quarter 2015 Results

• Reported record first quarter net income, excluding special items, of $149 million - a 67% increase over the first quarter of 2014.
• Reported adjusted earnings per share of $1.12 per diluted share, a 75% increase over the first quarter of 2014 and ahead of First Call analyst consensus estimate of $1.10 per share.
• Earned net income for the first quarter under Generally Accepted Accounting Principles (GAAP) of $149 million or $1.12per diluted share, compared to net income of $94 million, or $0.68 per diluted share in 2014.
• Recorded $26 million of employee incentive pay in recognition of Air Group employees' progress on meeting customer service, safety, operational and financial goals.
• Increased fuel efficiency (as measured by seat-miles per gallon) by 2.5% compared to the first quarter of 2014, as part of our effort to be the airline leader in environmental stewardship.
• Generated record adjusted pretax margin in the first quarter of 18.9% compared to 11.8% in 2014.
• Generated 18.8% adjusted pretax margin for the trailing 12-month period ended March 31, 2015, compared to 13.6% for the same period in the prior year.
• Achieved trailing 12-month after-tax return on invested capital of 20.1% compared to 14.8% in the 12-month period ended March 31, 2014.
• Repurchased 1.6 million shares of common stock for $102 million in the first quarter of 2015, representing 1.2% of the total shares outstanding at the beginning of the year.
• Paid a $0.20 per-share quarterly cash dividend on March 10, 2015, a 60% increase over the dividend declared in the first quarter of 2014.

Operational Highlights:

• Held the No. 1 spot in U.S. Department of Transportation on-time performance among the eight largest U.S. airlines for the twelve months ended February 2015.
• Named No. 1 on-time carrier in North America for the fifth year in a row by FlightStats in February 2015.
• Increased members in our Mileage Plan by 14% and Visa Signature affinity cardholders by 10% from the first quarter of 2014.
• Achieved our highest ever customer satisfaction score for the first quarter, improving 3 percentage points over prior year.
• Ranked first in the Leadership 500 Excellence Awards, recognizing the success of Alaska's Gear Up leadership training.
• Ranked in the Top 100 in the 2015 Forbes "America's Best Employers" survey.
• Ordered six additional Boeing 737-900ER aircraft for delivery in 2016 and 2017.
• Offered free checked first bag to all Mileage Plan members in January and all Alaska Airlines Visa Signature affinity credit card holders in February and March.
• New routes launched and announced in the first quarter are as follows:

Alaska Air Group, Inc., (NYSE: ALK) today reported first quarter 2015 GAAP net income of $149 million, or $1.12 per diluted share, compared to $94 million, or $0.68 per diluted share in the first quarter of 2014. Excluding the impact of mark-to-market fuel hedge adjustments, the company reported record adjusted net income of $149 million, or $1.12 per diluted share, compared to adjusted net income of $89 million, or $0.64 per diluted share, in 2014.

"Our record first quarter results reflect lower fuel prices, but more importantly the tremendous loyalty of our customers in Seattleand across our system" said CEO Brad Tilden. "It is gratifying to see such strong growth and financial results given unprecedented competition. I want to thank our incredible employees who continue to rise to the challenge and deliver outstanding experiences to our customers."

The following table reconciles the company's reported GAAP net income and earnings per diluted share (EPS) during the first quarters of 2015 and 2014 to adjusted amounts:

Refer to full documentation in attachments box, located at the top left, below the headline.