JetBlue Announces Tenth Consecutive Quarter of Profitability

JetBlue Airways Corporation last week reported its tenth consecutive quarterly profit. Results for the second quarter 2003 include:

• Operating revenues for the quarter totaled $244.7 million, representing growth of 63.9% over operating revenues of $149.3 million in the second quarter of 2002.
• Operating income in the quarter was $45.6 million, resulting in an 18.6% operating margin. This compares with operating income of $27.7 million and an 18.6% operating margin in the second quarter of 2002.
• Net income for the quarter was $37.9 million, representing earnings of $0.55 per diluted share, compared with second quarter 2002 net income of $14.6 million, or $0.22 per diluted share. Net income reflects our receipt of $22.8 million in compensation related to the Emergency War Time Supplemental Appropriations Act. Net of income taxes and profit-sharing, this amounts to $11.5 million, or $0.17 per diluted share.

"This was a great quarter for JetBlue," commented David Neeleman, chief executive officer. "We continued to demonstrate excellent cost control and solid operational performance in the face of strong growth."

During the second quarter of 2003, JetBlue achieved a completion factor of 99.9% of scheduled flights, identical to the second quarter of 2002. On-time performance, defined by the US Department of Transportation as arrivals within 14 minutes of schedule, was 87.4% in the second quarter of 2003 compared to 85.8% for the same period in 2002. The Company attained a load factor of 85.3%, an improvement of 1.2 points, on a capacity increase of 69.5% over the second quarter of 2002.

"Without a doubt, JetBlue's success is due to the exceptional efforts put forth by all of our great crewmembers and their focus on delivering The JetBlue Experience to our customers," said Dave Barger, president and chief operating officer.

Wow.

                               CONSOLIDATED STATEMENTS OF INCOME
                                (in thousands, except per share amounts)
                                                  (unaudited)

                                     Three Months Ended
                                          June 30,        
                                    --------------------   Percent
                                       2003       2002     Change
                                    ---------  ---------  ---------

  OPERATING REVENUES
     Passenger                      $237,037   $144,295       64.3
     Other                                  7,664        5,008       53.0
                                    ---------  ---------
      Total operating revenues       244,701    149,303       63.9

  OPERATING EXPENSES
     Salaries, wages and benefits     67,827     37,622       80.3
     Aircraft fuel                             32,457     16,983       91.1
     Sales and marketing                14,541     11,785       23.4
     Landing fees and other rents     16,309      9,681       68.5
     Aircraft rent                             14,907     10,298       44.8
     Depreciation and amortization   11,471      5,695      101.4
     Maintenance materials and
      repairs                                    5,366      1,506      256.4
     Other operating expenses         36,279     28,026       29.4
                                    ---------  ---------
      Total operating expenses       199,157    121,596       63.8
                                    ---------  ---------

  OPERATING INCOME                    45,544     27,707       64.4

     Operating margin                       18.6  %    18.6  %     - pts.

  OTHER INCOME (EXPENSE)
     Interest expense                     (6,023)    (4,725)      27.5
     Capitalized interest                   1,221      1,435      (14.9)
     Interest income and other         1,948        617      215.7
     Emergency War Time compensation
                                                 (1)         22,761          -
                                    ---------  ---------
      Total other income (expense)                19,907     (2,673)
                                    ---------  ---------

  INCOME BEFORE INCOME TAXES          65,451     25,034      161.4

     Income tax expense                         27,494     10,448
                                    ---------  ---------

  NET INCOME                                     $37,957    $14,586      160.2
                                    =========  =========

For the second quarter 2003, operating revenues increased by 63.9% over 2002 to $244.7 million. Revenue passenger miles increased 71.9% from the second quarter of 2002 to 2.8 billion. Available seat miles grew 69.5% to 3.3 billion. Yield per passenger mile was 8.48 cents, down 4.5% compared to 2002 on a 3.7% increase in average length of haul. Operating revenue per available seat mile (RASM) decreased 3.3% year-over-year to 7.47 cents.

FMI: www.jetblue.com