Frontier Airlines Holdings Inc. staged a recovery in the quarter ended Sept. 30, with a $17.3 million profit due to fuller planes, strong revenue growth and the benefits of fuel hedging.
Frontier also said its startup turboprop subsidiary Lynx Aviation plans to begin service this quarter, by the end of December.
The Denver-based airline’s net income was equivalent to 39 cents per diluted share. It’s a significant improvement from the year-ago quarter, when Frontier had roughly $509,000 in net income, and its most profitable quarter since 2000.
Frontier had total revenues of nearly $373 million in the September quarter, up from $312.5 million a year earlier.
Sean Menke, Frontier’s new chief executive as of last month, said in a written statement that the September quarter, which is the company’s fiscal second quarter, was the first full quarter of results from revenue enhancements made by the company’s marketing team in March 2007.
But the strong profits aren’t expected to last. Frontier said it expects a pre-tax loss for its December quarter, though a smaller loss than last year’s December quarter, excluding special items.
Menke said in the statement that “all of our current momentum and growth is set against a very ominous backdrop of $90 per barrel fuel which doesn’t appear ready to retreat any time soon.”
Frontier has an extensive domestic route network, international flights to Mexico, Canada and eventually Costa Rica, and a planned Lynx expansion, and Menke said “we will be forced to scrutinize the profitability and potential longevity of every route in our system,” adding that “there are no sacred cows.”
Lynx could be certified by early December if there are no major issues or delays, according to the Federal Aviation Administration.
Frontier had hoped to get Lynx certification in time to start service Oct. 1 but had to delay Lynx’s launch and is temporarily using other planes to fly Lynx routes. Lynx has four Q400 turboprop planes so far.
Kelly Yamanouchi: 303-954-1488 or kyamanouchi@denverpost.com
