Ray of sun for Jet Blue earnings; Carrier projects higher operating profit for 2nd quarter

JetBlue Airways Corp., the low-cost carrier struggling for a turnaround, said yesterday the skies may be brightening, forecasting higher second-quarter operating profits as fuel costs lessen.

The Forest Hills-based carrier, which just underwent the most far-reaching management shuffle in its history, said in a regulatory filing that it expects operating profit will be 9 percent to 11 percent of revenue.

That is up from a projection in April of 8 percent to 10 percent.

JetBlue said fuel costs are a major factor, estimating an average of $2.01 a gallon this quarter, down from a projected $2.06.

JetBlue does not forecast net income on a per-share basis, but analysts are expecting second-quarter earnings of 11 cents.

In the filing, JetBlue said second-quarter pretax margin will be 4 percent to 6 percent, up from an earlier forecast of 3 percent to 5 percent.

JetBlue last week said it intends to take a hard look at its expansion plans during the next two months in an effort to make a turnaround. It posted a $22-million loss in the first quarter.

The review is the first major step taken by David Barger, the airline's new chief executive, who took over in May from David Neeleman, who is now JetBlue's nonexecutive chairman. Barger is trying to determine whether to slow aggressive expansion plans.

The managerial switch occurred after JetBlue posted losses and went through embarrassing service disruptions during a snow and ice storm Feb. 14.

Alison Eshelman, a spokeswoman for JetBlue, said the improved outlook was the result of the company's "strong [fuel oil] hedging program" for the second quarter.

She said the company's full-year forecast remains unchanged. Operating income is expected to be 5 percent to 7 percent of sales. Operating margin is operating income divided by revenue.

JetBlue spent less on fuel in the quarter, but the airline carried more passengers in the period.

In trading yesterday, JetBlue shares were up 28 cents to $11.11.



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