Saturday, August 21, 2004

Fuel drags on
Hawaiian Air

Rising fuel costs cut profits for Hawaiian Airlines in July, which is historically one of the carrier's best months.

Hawaiian recorded a net income of $10.1 million for July, a 36 percent drop from $15.7 million in July 2003. July's earnings included an income tax charge of $7.2 million.

Fuel costs, which were more than 50 percent higher than a year earlier, drove up Hawaiian's operating expense last month. Overall, Hawaiian's operating costs rose $8.4 million in July, or 16 percent, compared with a year earlier. Fuel costs increased operating expenses by $4 million, while higher wage and benefits added $2.4 million.

Year-to-date operating expenses have risen by $39 million from a year earlier, with Hawaiian adding $15.7 million in fuels cost during the first seven months of the year.

"Travel to and within Hawaii remains strong and Hawaiian continues to be the airline of choice, which is terrific because fuel and other costs are rising," said Joshua Gotbaum, trustee of the carrier, which is operating under Chapter 11 bankruptcy protection.

Hawaiian's year-over-year systemwide load factor remained flat at 83 percent. Capacity rose 1.6 percent in July, while revenue per available seat mile, a key financial indicator, improved by 13 percent.

Hawaiian generated $18.6 million in operating profits on revenue of $80.7 million last month.

However, despite growing revenue by $10.1 million over a year ago, operating income rose by only $1.7 million over the $16.9 million earned in July 2003.

Hawaiian's year-to-date net income stands at $25.6 million, including a tax credit of $19.9 million, compared to income of $4.5 million for a year earlier, which does not include the special credit.

Hawaiian Airlines



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