Fed payment
lifts Aloha netCompensation of $14.5 million
enabled the carrier to finish
the second quarter with
a $6.3 million profit
Aloha Airlines had a profit of $6.3 million in the second quarter of this year because of compensation from the federal government for terrorism-related security costs.
The airline was still losing money from its operations, reporting a $6.7 million operating loss for the three months through June 30, but said it is on track in its goal of making a profit in the third quarter.
The second-quarter profit was a $13 million year-over-year turnaround, but was primarily due to a $14.5 million federal payment for government-imposed security expenses. However, the airline said its basic figures show it is on track in improving its operations. The operating loss was an improvement from a $9.9 million operating loss in the second quarter of 2002.
"The second-quarter financial results are in line with our expectations. We are exactly on target for a profitable year," said Glenn Zander, president and chief executive officer of Aloha.
Zander said earlier in the year that Aloha expected to lose money through the first half of this year, but should start making a profit in the third quarter.
As a privately held company, Aloha does not have to make public reports to shareholders, but must make regular publicly available reports to the U.S. Department of Transportation, showing that it is financially capable of running a safe airline.
Its report for the second quarter of 2003 shows revenues of $94.9 million, up 20.4 percent from $78.8 million in the year-earlier period. Operating expenses of $101.6 million were up 14.5 percent from $88.7 million in the year-earlier period.
Some of the 2003 increase in revenues and expenses was due to expansion of the airline's Hawaii-mainland services.
Competitor Hawaiian Airlines, which has been reporting profits while in bankruptcy reorganization, had a security-compensation payment similar to Aloha's in its second quarter. It received $17.5 million in May as part of $2.3 billion distributed under the Emergency Wartime Supplemental Appropriations Act.
For the first half of 2003, Aloha reported a net loss of $6.6 million. That compared to a loss of $13.9 million in the first half of 2002. The 2002 figures were complicated by one-time federal grants that helped airlines stay alive after the Sept. 11, 2001, terrorist attacks that crippled travel.
The Department of Transportation filing covers only Aloha Airlines and does not include its smaller island-hopping affiliate, Island Air.
