JetBlue Posts 1Q Loss on High Fuel Costs

JetBlue Airways Corp. said Tuesday it swung to a loss in its first quarter on high fuel costs, and the airline announced a "return to profitability" plan that includes deferring delivery of some aircraft and selling others.

The company posted a quarterly loss of $32 million, or 18 cents per share, versus a year-ago profit of $6 million, or 4 cents per share. Revenue rose 31 percent to $490 million from $373 million a year ago.

Analysts polled by Thomson Financial expected a wider loss of 20 cents per share on revenue of $497.9 million.

Shares of JetBlue rose 5 cents to $9.45 in early trading on the Nasdaq.

The company said it paid an average of $1.86 per gallon for fuel during the quarter, up 43 percent from a year ago. The fuel costs were the major factor in a near doubling of operating expenses during the period.

"We are disappointed to report our second consecutive quarterly loss," David Neeleman, JetBlue's chairman and chief executive, said in a statement. "As we face what might be the 'new normal' for fuel prices, we have developed a comprehensive 'return to profitability' plan that includes right-sizing capacity, revenue enhancements and cost reductions."

Details of the plan include focusing on medium- and short-haul flights, revamping fare structures and resizing capacity. JetBlue said it plans to defer orders for 12 planes, which were previously scheduled for delivery from 2007 through 2012, and sell two to five Airbus A320 jets.

For the first quarter, revenue passenger miles increased 24.8 percent from the first quarter of 2005 to 5.54 billion. A revenue passenger mile is equal to one paying passenger flown one mile.

Capacity increased 27.2 percent to 6.58 billion available seat miles. Occupancy, or the number of seats filled, fell 1.6 percentage points to 84.2 percent.

Looking ahead, the Forest Hills, N.Y.-based company said it expects to swing back to a profit in the second quarter but sees a loss for the full year. Analysts expect a 2006 loss of 21 cents on $2.38 billion in revenue and forecast second-quarter profit of 4 cents per share.

Copyright 2005 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

News stories provided by third parties are not edited by "Site Publication" staff. For suggestions and comments, please click the Contact link at the bottom of this page.