Investor Relations: MetroAir Posts Record Profit Ahead of New Aircraft Deliveries

KANSAS CITY, MO – Historically inexpensive jet fuel prices caused by falling oil prices led MetroAir Virtual Airlines earn $1.3 billion dollars in 2015.

Company executives are predicting another strong year, saying bookings for the spring are already ahead of last year thanks to increased consumer spending throughout the economy.

While fares were lower throughout 2015 due to increased flight frequency and competition, passenger ticket revenue still increased 17% year over year. Additionally, any loss from lower fares was easily recaptured in fuel savings, which kept $1.05 billion in MetroAir’s pocket. The company now spends less on fuel than it does labor; salaries and related costs rose 18% as additional front line employees were hired to match MetroAir’s explosive growth.

“Overall 2015 was an excellent year for our ‘little’ airline,” said Anders Young, MetroAir’s Chief Media Officer, “We see demand as very strong and we are predicting an exciting new year.”

Young said MetroAir would focus on strong opportunities in the U.S. market, while refocusing service in some international regions. Los Angeles, Fort Lauderdale, and Boston have been doing very well, while traffic to some international destinations declined over fears from international terror attacks, he explained on the end of year conference earning call.

It is yet to be decided among analysts whether MetroAir will stunt growth plans for 2016 or use cheap fuel costs to make significant investments in their future.

For all of 2015, MetroAir earned $1.30 billion on revenue of $13.45 billion .

FULL SEC FILING: Stratosphere 10-K FY2015


MetroAir Financial Summary

For the year ending December 31, 2015, we reported our largest annual net income and achieved our best operational performance in the company’s history.

Driven by strong year-over-year growth in revenues of 14%, we realized net income of $1.301 billion in 2015, which represents a 387% increase over net income of $336.4 million in 2014. Total cash reserves and short-term investments increased from $1,483.1 million at year end 2014 to $1,690.7 million at year end 2014. Operating revenue was over $13.5 billion, with 93 percent of revenue coming from passenger ticket sales at $12.62 billion. Operating margin for 2015 was 18.7%, and increase from the 2.92% operating margin from 2014.

Mainline and Allegius fuel expense decreased from $3.18 million to $2.14 billion in 2015, due to a historic drop in fuel prices. The average mainline and Allegius price per gallon of fuel was $1.54 in 2015 as compared to an average price per gallon of $2.94 in 2014. We have not entered into this calculation any transactions to hedge our fuel consumption.

Total system capacity increased 14.1% as compared to 2014. The increase in capacity was driven by our strong operating performance, as well as the addition of six Airbus A330-300 aircraft, two Boeing 777-300ER aircraft, and increased aircraft efficiency and utilization from upgauged frequencies network-wide. We operated 1,839 flights per day at year end 2015, as compared to 1,594 at year end 2014. During 2014, we received a total of two Boeing 777-300ER aircraft and six Airbus A330-300 aircraft, while Allegius received a total of 10 Embraer ERJ 145LR aircraft. In addition to these aircraft deliveries, we placed firm orders for five Boeing 787-8 Dreamliners with five options, as well as agreements to lease ten Boeing 787-8 Dreamliners.

We remain committed to maintaining a low cost structure, which we believe is necessary in an industry whose economic prospects are heavily dependent on two factors which we cannot control: the health of the economy, and the price of fuel.