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JetBlue Airways Corp. Reports Operating Results (10-Q/A)

February 07, 2011 | About:
10qk

10qk

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JetBlue Airways Corp. (JBLU) filed Amended Quarterly Report for the period ended 2010-06-30.

Jetblue Airways Corp. has a market cap of $1.73 billion; its shares were traded at around $5.8 with a P/E ratio of 19.6 and P/S ratio of 0.46. Jetblue Airways Corp. had an annual average earning growth of 6.3% over the past 10 years.Hedge Fund Gurus that owns JBLU: Paul Tudor Jones of The Tudor Group, George Soros of Soros Fund Management LLC, Jim Simons of Renaissance Technologies LLC, Bruce Kovner of Caxton Associates. Mutual Fund and Other Gurus that owns JBLU: Donald Smith of Donald Smith & Co., PRIMECAP Management, Chuck Royce of Royce& Associates.

Highlight of Business Operations:

Aircraft fuel expense increased 18%, or $43 million, due to a 12% increase in average fuel cost per gallon, or $30 million after the impact of fuel hedging, and an increase of six million gallons of aircraft fuel consumed, resulting in $13 million in additional fuel expense. We recorded $2 million in effective fuel hedge losses during the second quarter of 2010 versus $42 million in effective fuel hedge losses during the same period in 2009. Our average fuel cost per gallon was $2.30 for the second quarter of 2010 compared to $2.05 for the second quarter of 2009. Cost per available seat mile increased 12% primarily due to the increase in fuel price.

Aircraft fuel expense increased 16%, or $75 million, due to a 10% increase in average fuel cost per gallon, or $48 million after the impact of fuel hedging, and an increase of 13 million gallons of aircraft fuel consumed, resulting in $27 million in additional fuel expense. We recorded an immaterial amount in effective fuel hedge losses during 2010 versus $98 million in effective fuel hedge losses during 2009. Our average fuel cost per gallon was $2.25 for the six months ended June 30, 2010 compared to $2.04 for the same period in 2009. Cost per available seat mile increased 10% primarily due to the increase in fuel price.

At June 30, 2010, we had unrestricted cash and cash equivalents of $477 million and short term investments of $513 million compared to cash and cash equivalents of $896 million and short term investments of $240 million at December 31, 2009. Cash flows from operating activities were $356 million and $225 million for the six months ended June 30, 2010 and 2009, respectively. The increase in operating cash flows reflects the 8% increase in average fares and the 10% higher price of fuel in 2010 compared to 2009. We rely primarily on operating cash flows to provide working capital. At June 30, 2010, we had one line of credit totaling $40 million, which was secured by our ARS, and was fully drawn as of June 30, 2010. In July 2010, this line of credit was repaid and closed.

During the six months ended June 30, 2009, capital expenditures related to our purchase of flight equipment included $303 million for 11 aircraft and two spare engines, $15 million for flight equipment deposits and $8 million for spare part purchases. Capital expenditures for other property and equipment, including ground equipment purchases and facilities improvements, were $31 million. Proceeds from the sale of two aircraft were $58 million. Investing activities also included $29 million in proceeds from the sale of certain ARS.

Financing Activities. Financing activities for the six months ended June 30, 2010 consisted of (1), the required repurchase of $155 million of our 3.75% convertible debentures due 2035, (2) repaying a net $17 million on our line of credit collateralized by our ARS, (3) scheduled maturities of $84 million of debt and capital lease obligations, (4) our issuance of $47 million in fixed rate equipment notes and $19 million in non-public floating rate equipment notes secured by two EMBRAER 190 aircraft and four spare engines, and (5) reimbursement of construction costs incurred for Terminal 5 of $9 million.

Financing activities for the six months ended June 30, 2009 consisted of (1) our issuance of $201 million of 6.75% convertible debentures, raising net proceeds of approximately $197 million, (2) our public offering of approximately 26.5 million shares of common stock for approximately $109 million in net proceeds, (3) our issuance of $143 million in fixed rate equipment notes and $102 million in floating rate equipment notes to banks secured by three Airbus A320 aircraft and six EMBRAER 190 aircraft, (4) paying down a net of $107 million on our lines of credit collateralized by our ARS, (5) scheduled maturities of $74 million of debt and capital lease obligations, (6) the repurchase of $3 million principal amount of 3.75% convertible debentures due 2035 for $3 million, and (7) reimbursement of construction costs incurred for our new terminal at JFK of $25 million.

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