ExpressJet Reports Fourth Quarter and Full-Year 2009 Financial Results

HOUSTON, Feb. 23 /PRNewswire-FirstCall/ -- ExpressJet Holdings, Inc. (NYSE: XJT), parent company of regional and charter airline operator, ExpressJet Airlines, Inc., today reported fourth quarter net income of $30.2 million or $1.79 per diluted share...


HOUSTON, Feb. 23 /PRNewswire-FirstCall/ -- ExpressJet Holdings, Inc. (NYSE: XJT), parent company of regional and charter airline operator, ExpressJet Airlines, Inc., today reported fourth quarter net income of $30.2 million or $1.79 per diluted share. These results reflect a one-time income tax benefit of $47.6 million, including a $17.1 million cash receivable associated with recent tax legislation, and an approximate $30 million non-cash adjustment of deferred tax assets.

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For the full-year, ExpressJet reported a net loss of $3.3 million or $0.21 per diluted share. Excluding special items, ExpressJet reported a $1.6 million net loss for the full-year 2009 or $0.11 per diluted share.

For the three months ended December 31, 2009, ExpressJet recorded an operating loss of $17.1 million versus an operating loss of $8.7 million in 2008. The key drivers for ExpressJet's operating performance during the fourth quarter 2009 include: continuing utilization pressure; rising expenses associated with wages and benefit programs coupled with record low attrition; and lower than expected consumer price index adjustment impacting block hour revenue rates under its agreement with Continental Airlines.

"We are disappointed with our fourth quarter operating losses given the strides we've made to transition our company and the hard work of our employees," said Pat Kelly, Interim President and Chief Executive Officer. Kelly added, "We ended 2009 on a high note with the award of a new agreement with United Air Lines that will assist us in returning to positive cash flows during 2010. In 2010, we will focus on controlling costs, continuing to provide our customers with exceptional service and successfully executing our business plan."

Operational Overview

Scheduled Flying

On February 17, ExpressJet announced it signed an agreement with United covering 22 ERJ-145 aircraft for United Express service effective December 1, 2009. This agreement finalizes the previously announced successful bid by ExpressJet to replace flying done by other United Express partner carriers whose contracts have expired. An additional ten ERJ-145 aircraft, sourced from ExpressJet's Corporate Aviation (charter) fleet, were added through an amendment to the agreement and will begin operating for United Express on May 1, 2010.

Kelly said, "Increasing productivity through flying as United Express is a key component to generating positive, operating cash flows during 2010. We expect block hours to increase between 10% and 15% as a result, and to establish a run-rate during third quarter 2010 after all aircraft are in place and start-up costs are complete."

Under this agreement, ExpressJet began flying three aircraft as United Express on December 1, 2009, and increased to six aircraft in operation by month end. Block hours for ExpressJet's flying as United Express totaled 1,632 during December. Daily utilization for United Express totaled 8.28 hours during December 2009.

To meet contract requirements for expected Corporate Aviation (charter) and United Express flying, ExpressJet entered into an agreement with Continental to sublease eight aircraft operating within the Continental Express operation during December 2009.

Within the tables included herein and going forward, ExpressJet will report operating results for both Continental Express and United Express as Partner Flying in monthly traffic releases.

Under its capacity purchase agreement with Continental, ExpressJet flew 165,942 block hours using 214 aircraft during fourth quarter 2009. These results followed industry seasonality trends and represented a decline of almost 2% versus third quarter 2009. Year-over-year, daily utilization within the Continental Express fleet totaled 8.4 hours in fourth quarter 2009 versus 8 hours in fourth quarter 2008; an improvement ExpressJet anticipates will continue during 2010.

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