JetBlue Airways on Tuesday reported a quarterly loss on high fuel costs and said it would defer deliveries of 12 aircraft and sell possibly up to five in a plan to return to profitability.
The discount carrier reported a net loss in the first quarter of USD$32 million, compared with a net profit of USD$6 million in the year-ago period.
"We are disappointed to report our second consecutive quarterly loss," Chief Executive David Neeleman said in a statement.
He said in the face of high fuel costs, the company had developed a new plan, which includes right-sizing capacity, revenue enhancements and cost reductions.
The company's plan includes deferral of 12 aircraft deliveries and selling of at least two, and potentially up to five, existing Airbus A320 aircraft from its current fleet.
US airlines have been under pressure as high fuel costs and increasing competition, including from low-cost carriers, affect profits, pushing some companies, such as Delta Air Lines and Northwest Airlines, into bankruptcy.
Although, carriers have been able to raise ticket prices as demand continues to be strong and airlines cut back on capacity, revenue increases still have not been able to counter the effect of high fuel prices.
JetBlue, the No. 2 US low-cost carrier, said operating revenue increased 31.4 percent to USD$490 million.
The carrier said realized fuel price during the quarter surged 42.5 percent to USD$1.86 per gallon in the quarter.
Looking ahead, the company said it expects to report an operating margin between 4 percent and 6 percent for the second quarter, assuming fuel cost per gallon of USD$2.10.
It said it expects to report net income in the second quarter and a net loss for the full year 2006.
A one-time outperformer among US airlines, JetBlue stock has come back down to earth. So far this year, its shares are down more than 38 percent, compared with a roughly 7 percent drop in the sectoral Amex Airlines index.
