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SkyWest (SKYW) Q4 Earnings and Revenues Lag Estimates

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SkyWest, Inc. (SKYW - Free Report) reported bleak fourth-quarter 2022 results wherein both earnings and revenues fell short of the respective Zacks Consensus Estimate. The company reported break-even earnings (excluding 93 cents from non-recurring items) missing the Zacks Consensus Estimate of 8 cents. The bottom line also decreased 100% year over year due to lower revenues.

Revenues of $681.25 million missed the Zacks Consensus Estimate of $704.19 million and slipped 12% year over year. The decrease in overall revenues was due to a $4 million reduction in contract and prorate revenue in addition to a $92 million decrease caused by revenue deferrals. SkyWest deferred recognizing $69 million of revenue in the final quarter of 2022.

Revenues from flying agreements (contributing 96.1% to the top line) fell by 12.9% in the fourth quarter of 2022 from the year-ago reported figure of $751.8 million. Expenses fell 4% to $716.3 million in comparison to the year-ago reported figures. The decrease was mainly due to the 35.5% reduction in costs on aircraft, maintenance and repairs.

SkyWest, Inc. Price, Consensus and EPS Surprise

SkyWest, Inc. Price, Consensus and EPS Surprise

SkyWest, Inc. price-consensus-eps-surprise-chart | SkyWest, Inc. Quote

The airline carried 12.1% fewer passengers in the reported quarter on a year-over-year basis. The passenger load factor (percentage of seats filled by passengers) increased 2.7 points to 84.6% in the fourth quarter.

The fleet size increased to 517 from 509 a year ago. SKYW, which has 236 E175 aircraft in its fleet currently, aims to operate 240 such jets by 2025-end.  

At the end of the fourth quarter, the company had cash and marketable securities of $1047.2 million, climbing from $860.4 million reported a year ago. In the fourth quarter, SKYW spent $111 million toward capital expenditure for the purchase of four new E175 aircraft and other fixed assets. SKYW ended the quarter with a long-term debt of 3.4 billion up from the 3.1 billion reported a year ago.

Zacks Rank

Currently, SkyWest carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Below are some stocks from the  Zacks Airline industry, that have reported fourth-quarter 2022 earnings beat.

Delta Air Lines’ (DAL - Free Report) fourth-quarter 2022 earnings (excluding 19 cents from non-recurring items) of $1.48 per share beat the Zacks Consensus Estimate of $1.29 per share. DAL reported earnings of 22 cents per share a year ago, dull in comparison to the current scenario, as air-travel demand was not so buoyant then.

Delta reported revenues of $13,435 million, which also surpassed the Zacks Consensus Estimate of $13,030.3 million. Driven by the high air-travel demand, total revenues increased by more than 41.87% on a year-over-year basis. Management expects first-quarter 2023 earnings per share in the band of 15-40 cents.

Alaska Air Group (ALK - Free Report) reported mixed fourth-quarter 2022 results, wherein earnings surpassed the Zacks Consensus Estimate but revenues missed the same. Quarterly earnings of 92 cents per share beat the Zacks Consensus Estimate of 90 cents. The bottom line surged more than 100% year over year.

Reflecting the uptick in air-travel demand, consolidated traffic (measured in revenue passenger miles) rose 14% to 12.85 billion. Consolidated load factor (percentage of seats filled by passengers) increased 6.1 percentage points to 85.5% in the fourth quarter of 2022. Economic fuel price per gallon climbed 57.1% to $3.55.

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