Alaska Air Group has joined a growing list of US carriers sliding into the red for 2008, posting a full-year loss of $135.9 million for 2008 compared with a $124.3 million profit in 2007.
The Horizon Air and Alaska Airlines parent company lost $75.2 million in the final quarter of 2008, compared with a net income of $7.4 million for the quarter in 2007.
Excluding special items, however, the company would have reported a $16.4 million profit compared with a net loss of $17.9 million for the fourth quarter of 2007. Special items included $9.2 million in restructuring charges, Bombardier CRJ-700 fleet transition costs of $6.7 million, fuel hedge adjustments of $80.2 million and losses of $50 million on the early termination of fuel hedge contracts that were to expire in 2009 and 2010.
Driven by fuel prices to cut capacity, load factors increased at Alaska but decreased at Horizon during the fourth quarter. But as operating costs increased for both mainline and regional flying, passenger traffic dropped for both carriers in the quarter.
As a result, sales declined in the fourth quarter but increased for the year.
Fourth quarter revenue was $827.1 million, down 3% from $853.4 million for the same period in 2007.
Alaska's revenue reached $3.7 billion for the full-year, up 5.7% from $3.5 million.
For the fourth quarter the company's expenses jumped to $933.8 million from $838 million, an 11.4% change. Full-year 2008 expenses increased 15.2% to $3.8 billion from $3.3 billion in 2007.
The carrier's operating losses were $106.7 million for the quarter compared with an operating income of $15.4 million.
Full-year operating losses were $172.2 million, down from $210.9 million in 2007.
Alaska ended 2008 with just over one billion in cash, up from $823 million at year-end 2007.