SYS-CON MEDIA Authors: Trevor Parsons, Sean Houghton, Glenn Rossman, Ignacio M. Llorente, Xenia von Wedel

News Feed Item

Virgin America Reports Second Quarter 2014 Earnings

Airline Reports Second Quarter and Year-to-Date Net Income, Seventh Straight Quarter of Improved Year-over-Year Financial Results

SAN FRANCISCO, Aug. 12, 2014 /PRNewswire/ -- Virgin America today reports its financial results for the second quarter of 2014 with operating income of $47.1 million and net income of $37.0 million. The airline posted an operating margin of 11.8 percent – a 4.4 point improvement over the second quarter of 2013, driven largely by a 7.8 percent growth in revenue per available seat mile (RASM) over the prior year period.

Second Quarter 2014 Financial Highlights

  • Operating Revenue: Total operating revenue of $398.8 million, an increase of 6.1 percent over the second quarter of 2013.
  • Revenue per Available Seat Mile (RASM): RASM increased 7.8 percent compared to the second quarter of 2013, to 12.46 cents.  Year-over-year RASM growth was driven by a 5.0 percent increase in yield and a 1.2 point increase in load factor.
  • Cost per Available Seat Mile (CASM): Total CASM increased 2.7 percent compared to the second quarter of 2013, to 10.99 cents.  CASM excluding fuel costs for the quarter increased 3.9 percent year-over-year, to 6.87 cents, primarily due to higher labor and airport costs.
  • Operating Income:  Second quarter of 2014 operating income increased by 69.1 percent over the second quarter of 2013 to $47.1 million with an operating margin improvement of 4.4 points year-over-year.  
  • Net Income: Net income for the quarter increased fourfold year-over-year, from $8.8 million to $37.0 million. Virgin America's year-to-date net income improved by $52.2 million from a net loss of $37.5 million for the six months ended June 30, 2013 to net income of $14.6 million for the six months ended June 30, 2014, an improvement of 7.5 margin points.
  • Capacity:  Available seat miles (ASMs) for the second quarter of 2014 decreased 1.6 percent year-over-year.  The airline ended the quarter with 53 Airbus A320-family aircraft.
  • Liquidity: Unrestricted cash was $180.0 million as of June 30, 2014.

Operational Highlights
Recent key milestones achieved include:

  • In April, for the second straight year, Virgin America was the top-ranked airline in the Airline Quality Rating (AQR), an annual analysis of airline performance conducted by Wichita State University and Embry-Riddle Aeronautical University. Based on publicly reported data all carriers must submit to the U.S. Department of Transportation, the AQR provides a ranking of how airlines stack up against each other on key metrics important to consumers including: on-time performance, customer complaints, denied boarding and mishandled bags. 
  • In May, Virgin America announced that it had sub-leased two gates at Dallas Love Field (DAL) from American Airlines.  Service from Love Field to New York's LaGuardia Airport, Ronald Reagan Washington National Airport in Washington, D.C., Los Angeles International Airport, and San Francisco International Airport is scheduled to begin in October 2014.
  • In July, Virgin America secured "Top Domestic Airline" ranking for the seventh consecutive year in the annual Travel + Leisure's World's Best Awards readers' survey. 
  • Also in July, Virgin America took top honors for Best Low-Cost Airline in the U.S.A. for the fifth consecutive year as well as Best Staff Service among North American airlines for the fourth year in a row in the 2014 World Airline Awards (formerly Skytrax awards).

 

Virgin America, Inc.

Consolidated Statements of Operations - Unaudited

For the Three and Six Months Ended June 30, 2014 and 2013

(in thousands)

















Three months ended






Six months ended





June 30






June 30





2014


2013


% Change




2014


2013


% Change

















Passenger revenue

$  357,619


$  341,027


4.9




$  633,837


$  610,061


3.9


Other revenue

$    41,227


$    35,047


17.6




$    78,398


$    67,345


16.4


Total operating revenue

$  398,846


$  376,074


6.1




$  712,235


$  677,406


5.1
































Aircraft fuel

$  131,664


$  133,312


(1.2)




$  247,423


$  249,908


(1.0)


Salaries, wages and benefits

$    59,318


$    48,930


21.2




$  113,143


$    94,245


20.1


Aircraft rent

$    45,861


$    51,707


(11.3)




$    92,357


$  110,725


(16.6)


Landing fees and other rent

$    33,286


$    31,189


6.7




$    65,507


$    58,758


11.5


Sales and marketing

$    28,615


$    29,952


(4.5)




$    53,177


$    48,184


10.4


Aircraft maintenance

$    16,409


$    15,432


6.3




$    35,453


$    32,892


7.8


Depreciation and amortization

$      3,483


$      3,249


7.2




$      6,753


$      6,408


5.4


Other operating expenses

$    33,083


$    34,431


(3.9)




$    64,426


$    63,390


1.6


Total operating expenses

$  351,719


$  348,202


1.0




$  678,239


$  664,510


2.1

















Operating income (loss)

$    47,127


$    27,872


69.1




$    33,996


$    12,896


163.6

















Operating Margin

11.8%


7.4%


4.4

pts


4.8%


1.9%


2.9

pts
















Other expense

$      9,877


$    19,023


(48.1)




$    19,051


$    50,435


(62.2)

















Income (loss) before taxes

$    37,250


$      8,849


321.0




$    14,945


$  (37,539)


 NM 

















Income tax expense

$          267


$             -


 NM 




$          316


$             -


 NM 

















NET INCOME (LOSS)

$    36,983


$      8,849


317.9




$    14,629


$  (37,539)


 NM 


 


Three months ended





Six months ended




Key Operating Statistics

June 30





June 30





2014


2013


% Change



2014


2013


% Change
















Available seat miles (ASMs)(millions)

3,202


3,253


(1.6)



5,979


5,948


0.5


Departures

15,137


15,130


0.0



28,962


27,712


4.5


Average stage length (miles)

1,482


1,510


(1.9)



1,445


1,510


(4.3)


Aircraft in service

53


53


-



53


53


-


Fleet utilization (blk hours per ac day)

11.3


11.6


(2.6)



10.7


10.7


-
















Passengers (thousands)

1,729


1,730


(0.1)



3,208


3,068


4.6


Average fare

$ 206.81


$ 197.07


4.9



$ 197.55


$ 198.86


(0.7)


Yield per passenger mile (cents)

13.15¢


12.52¢


5.0



12.89¢


12.70¢


1.5


Revenue passenger miles - RPMs (millions)

2,719


2,723


(0.1)



4,917


4,806


2.3


Load factor

84.9%


83.7%


1.2

pts


82.2%


80.8%


1.4

pts

Passenger revenue per available seat mile - PRASM (cents)

11.17¢


10.48¢


6.6



10.60¢


10.26¢


3.3


Total revenue per available seat mile - RASM (cents)

12.46¢


11.56¢


7.8



11.91¢


11.39¢


4.6
















Cost per available seat mile - CASM (cents)

10.99¢


10.70¢


2.7



11.34¢


11.17¢


1.5


Cost per ASM, excluding fuel (cents)

6.87¢


6.61¢


3.9



7.21¢


6.97¢


3.4


Fuel cost per gallon

$ 3.11


$ 3.13


(0.6)



$ 3.14


$ 3.23


(2.8)


Fuel gallons consumed (thousands)

42,281


42,642


(0.8)



78,828


77,337


1.9


Teammates (FTEs)

2,500


2,375


5.3



2,500


2,375


5.3


Virgin America is announcing these financial results in advance of the U.S. Department of Transportation quarterly reports.

About Virgin America: Known for its mood-lit cabins, three beautifully designed classes of service and innovative fleetwide amenities — like touch-screen personal entertainment, WiFi and power outlets at every seat, Virgin America has built a loyal following of flyers and earned a host of awards since launching in 2007 — including being named both the "Best U.S. Airline" in Condé Nast Traveler's Readers' Choice Awards for the past six consecutive years and "Best Domestic Airline" in Travel + Leisure's World's Best Awards for the past seven consecutive years. For more: www.virginamerica.com

Virgin America logo.

Logo - http://photos.prnewswire.com/prnh/20090123/VIRGINAMERICALOGO

 

 

SOURCE Virgin America

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
In high-production environments where release cycles are measured in hours or minutes — not days or weeks — there's little room for mistakes and no room for confusion. Everyone has to understand what's happening, in real time, and have the means to do whatever is necessary to keep applications up and running optimally. DevOps is a high-stakes world, but done well, it delivers the agility and performance to significantly impact business competitiveness.
"Our premise is Docker is not enough. That's not a bad thing - we actually love Docker. At ActiveState all our products are based on open source technology and Docker is an up-and-coming piece of open source technology," explained Bart Copeland, President & CEO of ActiveState Software, in this SYS-CON.tv interview at DevOps Summit at Cloud Expo®, held Nov 4-6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
ScriptRock makes GuardRail, a DevOps-ready platform for configuration monitoring. Realizing we were spending way too much time digging up, cataloguing, and tracking machine configurations, we began writing our own scripts and tools to handle what is normally an enormous chore. Then we took the concept a step further, giving it a beautiful interface and making it simple enough for our bosses to understand. We named it GuardRail after its function - to allow businesses to move fast and stay sa...
The Internet of Things is not new. Historically, smart businesses have used its basic concept of leveraging data to drive better decision making and have capitalized on those insights to realize additional revenue opportunities. So, what has changed to make the Internet of Things one of the hottest topics in tech? In his session at @ThingsExpo, Chris Gray, Director, Embedded and Internet of Things, discussed the underlying factors that are driving the economics of intelligent systems. Discover ...
SYS-CON Media announced today that Sematext launched a popular blog feed on DevOps Journal with over 6,000 story reads over the weekend. DevOps Journal is focused on this critical enterprise IT topic in the world of cloud computing. DevOps Journal brings valuable information to DevOps professionals who are transforming the way enterprise IT is done. Sematext is a globally distributed organization that builds innovative Cloud and On Premises solutions for performance monitoring, alerting an...
"BSQUARE is in the business of selling software solutions for smart connected devices. It's obvious that IoT has moved from being a technology to being a fundamental part of business, and in the last 18 months people have said let's figure out how to do it and let's put some focus on it, " explained Dave Wagstaff, VP & Chief Architect, at BSQUARE Corporation, in this SYS-CON.tv interview at @ThingsExpo, held Nov 4-6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
The major cloud platforms defy a simple, side-by-side analysis. Each of the major IaaS public-cloud platforms offers their own unique strengths and functionality. Options for on-site private cloud are diverse as well, and must be designed and deployed while taking existing legacy architecture and infrastructure into account. Then the reality is that most enterprises are embarking on a hybrid cloud strategy and programs. In this Power Panel at 15th Cloud Expo (http://www.CloudComputingExpo.com...
Verizon Enterprise Solutions is simplifying the cloud-purchasing experience for its clients, with the launch of Verizon Cloud Marketplace, a key foundational component of the company's robust ecosystem of enterprise-class technologies. The online storefront will initially feature pre-built cloud-based services from AppDynamics, Hitachi Data Systems, Juniper Networks, PfSense and Tervela. Available globally to enterprises using Verizon Cloud, Verizon Cloud Marketplace provides a one-stop shop fo...
Leysin American School is an exclusive, private boarding school located in Leysin, Switzerland. Leysin selected an OpenStack-powered, private cloud as a service to manage multiple applications and provide development environments for students across the institution. Seeking to meet rigid data sovereignty and data integrity requirements while offering flexible, on-demand cloud resources to users, Leysin identified OpenStack as the clear choice to round out the school's cloud strategy. Additional...
SYS-CON Events announced today that IDenticard will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. IDenticard™ is the security division of Brady Corp (NYSE: BRC), a $1.5 billion manufacturer of identification products. We have small-company values with the strength and stability of a major corporation. IDenticard offers local sales, support and service to our customers across the United States and Canada...
SYS-CON Media announced today that Aruna Ravichandran, VP of Marketing, Application Performance Management and DevOps at CA Technologies, has joined DevOps Journal’s authors. DevOps Journal is focused on this critical enterprise IT topic in the world of cloud computing. DevOps Journal brings valuable information to DevOps professionals who are transforming the way enterprise IT is done. Aruna's inaugural article "Four Essential Cultural Hacks for DevOps Newbies" discusses how to demonstrate the...
The move in recent years to cloud computing services and architectures has added significant pace to the application development and deployment environment. When enterprise IT can spin up large computing instances in just minutes, developers can also design and deploy in small time frames that were unimaginable a few years ago. The consequent move toward lean, agile, and fast development leads to the need for the development and operations sides to work very closely together. Thus, DevOps become...
SYS-CON Events announced today that Windstream, a leading provider of advanced network and cloud communications, has been named “Silver Sponsor” of SYS-CON's 16th International Cloud Expo®, which will take place on June 9–11, 2015, at the Javits Center in New York, NY. Windstream (Nasdaq: WIN), a FORTUNE 500 and S&P 500 company, is a leading provider of advanced network communications, including cloud computing and managed services, to businesses nationwide. The company also offers broadband, p...
SYS-CON Events announced today that AIC, a leading provider of OEM/ODM server and storage solutions, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. AIC is a leading provider of both standard OTS, off-the-shelf, and OEM/ODM server and storage solutions. With expert in-house design capabilities, validation, manufacturing and production, AIC's broad selection of products are highly flexible and are conf...

ARMONK, N.Y., Nov. 20, 2014 /PRNewswire/ --  IBM (NYSE: IBM) today announced that it is bringing a greater level of control, security and flexibility to cloud-based application development and delivery with a single-tenant version of Bluemix, IBM's