JetBlue Airways Lowers 1st-Qtr. Forecast

Prior to its own revised estimates, analysts polled by Thomson Financial forecast a first-quarter loss of 9 cents a share on revenue of $652 million.


JetBlue Airways Corp. expects to post an operating loss for the first quarter, due to higher fuel prices and the lingering effects of service interruptions from a Feb. 14 ice storm in the New York area.

JetBlue said Wednesday it expects first-quarter operating margin of negative 4 percent to negative 2 percent, based on assumed fuel costs of $1.89 per gallon. The company previously forecast a quarterly operating margin of 2 percent to 4 percent on assumed fuel costs of $1.90.

Operating margin measures operating income as a percentage of operating revenues. A negative operating margin indicates that the company's operating costs are rising faster than projected sales.

Analysts polled by Thomson Financial forecast a first-quarter loss of 9 cents a share on revenue of $652 million before the company lowered its guidance on operating margins on Wednesday.

JetBlue also now estimates that it will report an operating margin in the full year of between 8 percent and 10 percent, based on assumed fuel costs of $1.94 per gallon. The company previously forecast a full-year operating margin of between 10 percent and 12 percent on assumed fuel costs of $1.93.

JetBlue's operating margin was 5.4 percent in 2006 and it posted a loss of $1 million on operating income of $127 million and revenue of $2.36 billion.

The company anticipates pretax margin of between 3 percent and 5 percent for the year. JetBlue previously forecast a pretax margin of between 5 percent and 7 percent.

Depsite the new guidance, shares of JetBlue rose 30 cents to $13.20 in pre-market trading.


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