Contact: Doug Voss
President & Chief Executive Officer
Great Lakes Aviation, Ltd.
1965 330th Street
Spencer, IA 51301
For Immediate Release
April 20, 1998
Great Lakes Aviation, Ltd. (the "Company") reports that the Company’s net loss for the year was $18.3 million after recognition of $9.2 million for shutdown and other nonrecurring expenses related to the Company’s voluntary suspension of operations on May 16, 1997 and the partial phase-out and reduction of its EMB120 (Brasilia) fleet.
Selected financial and statistical data for the years 1997 and 1996 (in thousands, except per share and selected operating data) were:
| FINANCIAL SUMMARY | YEAR ENDED DECEMBER 31 |
||
1997 |
1996 |
CHANGE |
|
| Passenger revenues | $75,204 |
$104,016 |
(27.7)% |
| Public service revenues | 6,131 |
3,512 |
74.6 |
| Total revenues | 83,790 |
109,670 |
(23.6) |
| Operating expenses before shutdown and other | |||
| nonrecurring expenses | 88,206 |
118,072 |
(25.3) |
| Shutdown and other nonrecurring expenses | 9,234 |
0 |
- |
| Total operating expenses | 97,440 |
118,072 |
(17.5) |
| Operating loss | (13,650) |
(8,402) |
(62.5) |
| Interest expense | 4,621 |
5,875 |
(21.3) |
| Income tax provision (benefit) | - |
(1,454) |
|
| Net loss | (18,271) |
(12,823) |
|
| NET LOSS PER SHARE | ($2.41) |
($1.69) |
|
| OPERATING STATISTICS | |||
| Available seat miles (000s) | 438,272 |
678,304 |
(35.4) |
| Revenue passengers carried | 676,015 |
1,012,965 |
(33.3) |
| Revenue passenger miles (000s) | 202,689 |
299,607 |
(32.3) |
| Passenger load factor | 46.2% |
44.2% |
|
| Yield per revenue passenger mile | 37.1� |
34.7� |
|
| Operating cost per available seat mile | 22.2� |
17.4� |
|
As part of the realignment of United Airlines, Inc.’s relationship with its United Express carriers, the Company has been authorized to begin service from Denver to 14 additional destinations on April 23, 1998. Effective June 1, 1998, the Company will provide service from Denver to an additional four cities.
Along with passenger revenues, some of these new routes will be a significant source of public service revenues.
The company received $6.1 and $3.5 million in public service revenue in 1997 and 1996, respectively. During 1998 and 1997 the Company has negotiated increases in rates and added additional cities and flight frequencies eligible for these revenues. When service is fully implemented, subsidy rates currently in effect are expected to generate essential air service revenues of approximately $18.6 million on an annualized basis, as follows:
Annual |
|||||
Subsidy |
|||||
Rate |
|||||
Order # |
(in thousands) |
Expires |
|||
| Alpena/Sault Ste. Marie, MI | 97-09-15 |
$ 398 |
12/31/98 |
||
| Dickinson, ND | 98-03-27 |
330 |
3/31/00 |
||
| Fairmont, MN/Brookings, Yankton, SD/ | |||||
| Devils Lake, Jamestown, ND/Norfolk, NE | 97-08-09 |
4,070 |
7/31/99 |
||
| Fergus Falls, MN | 98-02-04 |
* | 997 |
*** |
|
| Ironwood, MI | 97-07-06 |
493 |
6/30/98 |
||
| Manistee, MI | 96-12-42 |
159 |
12/28/98 |
||
| Mattoon, IL | 97-05-03 |
218 |
2/28/99 |
||
| Ottumwa, IA/Sterling-Rock Falls, IL | 97-01-14 |
923 |
9/30/98 |
||
| Mount Vernon, IL | 96-08-23 |
246 |
6/30/98 |
||
| Lamar, CO/Goodland, KS/Alliance, Chadron | |||||
| Kearney, McCook, NE | 97-10-10 |
5,579 |
6/30/99 |
||
| Cortez, CO/Dodge City, Garden City, Great | |||||
| Bend, Hays, Liberal, KS | 98-03-32 |
* | 2,907 |
9/30/99 |
|
| Alamosa, CO/Laramie, Rock Springs, | |||||
| Worland, WY | Pending |
* | 2,303 |
** |
|
TOTAL |
$ 18,623 |
||||
| *Service scheduled to begin in 1998 | |||||
| **Expires two years from date of agreement | |||||
| ***Expires two years from date of initial service |
Great Lakes Aviation, Ltd. operates as United Express serving 50 destinations in eleven states located in the Upper Midwest, with hubs located at Chicago O’Hare, Denver and Minneapolis/St. Paul, as of December 31, 1997. The Company also operates as Great Lakes Airlines on one route in the Midwest.
Certain matters discussed within this press release may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Although Great Lakes Aviation, Ltd. believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from the Company’s expectations include general industry conditions, changes in local or national economic conditions, the Company’s relationship with United Airlines, changes in public subsidy rates for the Essential Air Services Program, and other risks detailed from time to time in the Company’s SEC reports, including the Company’s Form 10-K for the fiscal year ended December 31, 1997.
Great Lakes Aviation, Ltd. trades on the NASDAQ/NMS under the symbol GLUX.
For more information visit us at our web site
https://www.greatlakesav.com