re: WLDA
PuddleGlum,
great news from WLDA - good quarterly and the company is progressing well towards getting rid off negative shareholders equity. Only $6m in the red as of now, big improvement here over the last 2 years. Looking forward to tough negotiating with the 2 leasing entitites to lower aircraft leases as Hollis has indicated to materialize early 2004 .. I am quite bullish on this one and me thinks double digits is certainly possible over the course of the year here..
biz.yahoo.com
World Airways Announces Results for the Fourth Quarter and Year Ended December 31, 2003
Thursday February 5, 4:30 pm ET
* Profitability for Second Consecutive Year
* Seven-Fold Increase in Net Earnings Between 2002 and 2003
* 2003 Operating Income of $28.4 Million Versus $7.1 Million in 2002
PEACHTREE CITY, Ga., Feb. 5 -- World Airways, Inc. (Nasdaq: WLDA - News) today announced financial results for the quarter and year ended December 31, 2003.
FINANCIAL RESULTS
Fourth Quarter 2003
Revenues for the quarter ended December 31, 2003, increased 22.1% to $122.3 million from $100.1 million in the fourth quarter of 2002. The Company reported significant growth in both military passenger revenue associated with the U.S. Air Force's Air Mobility Command and commercial passenger full service flying, which more than offset a reduction in commercial cargo full service flying. Total block hours increased 5.1%, to 11,141 in the fourth quarter of 2003 compared to 10,604 in the same period of last year.
Operating income for the 2003 fourth quarter was $7.1 million, an improvement of $12.1 million over an operating loss of $5.0 million for the prior year's quarter. The Company's earnings before income tax for the fourth quarter of 2003 were $1.0 million versus a loss of $6.8 million for the comparable period of last year. The Company utilized all of its unrestricted federal net operating loss carry-forwards in 2003.
Net earnings for the 2003 fourth quarter were $0.9 million, or $0.08 per basic share and $0.06 per diluted share, compared to a net loss of $6.8 million, or $0.61 per basic and diluted share, for the same quarter of 2002. Per share results were computed on the basis of 11.4 million and 14.8 million weighted average shares outstanding for the fourth quarter of 2003, and 11.1 million weighted average shares for the same quarter of 2002, respectively. Net earnings for the 2003 fourth quarter included, as previously reported, a $3.0 million non-cash charge for debt extinguishment related to the restructuring of the Company's convertible senior subordinated debentures. The charge is the difference between the fair market value of the new debentures and the carrying amount of the old debentures extinguished. In addition, the fourth quarter of 2003 included $1.3 million of fees paid to Wells Fargo Foothill, Inc. for the early termination of this credit facility.
Operating expenses were $115.2 million for the fourth quarter of 2003 compared to $105.1 million in the fourth quarter of 2002. The most significant changes were increases of $8.0 million for flight operations, $3.7 million for fuel, and $1.5 million for sales, general and administrative expenses, with a decrease of $2.3 million for maintenance expenses. Operating expenses for 2002 included $2.0 million related to the return of grant proceeds received under the Air Transportation Safety and System Stabilization Act.
The increase in flight operations expense was largely due to increased travel costs for both pilots and flight attendants, higher pilot and flight attendant wages, as well as simulator and flight attendant training, and higher catering, passenger handling and communication costs. The majority of these higher flight expenses were directly attributable to the increased military and full-service flying in the fourth quarter of 2003.
The increase in fuel costs reflects additional consumption associated with the increase in full-service flying. In the fourth quarter of 2003, the Company's customers paid for approximately 96% of the fuel purchased, which limits the Company's exposure to increased fuel costs.
The increase in sales, general and administrative expenses is primarily due to bad debt expense associated with air services provided to Ritetime Aviation and Travel Services.
The lower maintenance expenses were primarily due to a decrease in MD-11 engine overhauls, partially offset by higher maintenance reserve payments to aircraft lessors based on aircraft usage. The increase in maintenance reserve payments was directly related to the increase in flying in the fourth quarter of 2003.
The increase in other expense was due to the $3.0 million non-cash charge for debt extinguishment related to the restructuring of the Company's convertible senior subordinated debentures and $1.3 million of fees paid to Wells Fargo Foothill, Inc. for the early termination of this credit facility, as noted above.
Year Ended December 31, 2003
Revenues for 2003 were $474.9 million compared to $384.5 million for the same period of 2002, a 24% increase. Operating income was $28.4 million for 2003 versus $7.1 million for the previous year. The Company's earnings before income tax for 2003 were $19.1 million versus $2.0 million for the same period of 2002. The Company's estimated annual effective tax rate for 2003 is approximately 19.8%. This effective rate differs from statutory rates due primarily to utilization of net operating loss carry-forwards.
Net earnings for 2003 were $15.3 million, or $1.37 per basic share and $0.98 per diluted share, versus net earnings of $2.0 million, or $0.18 per basic and diluted share, for 2002. Per share results were computed on the basis of 11.2 and 17.8 million weighted average shares outstanding for 2003, and 11.1 million weighted average shares for 2002.
The Company reported that it ended 2003 with cash and cash equivalents of $53.8 million, of which $23.3 million is restricted, due to $18.8 million required to pay the convertible debentures called on December 30, 2003 (which was paid in January 2004), $3.4 million for letters of credit that had to be collaterized and $1.1 million related to unearned revenue. The Company's 2003 ending unrestricted cash balance was $30.5 million compared to $20.8 million at December 31 2002.
MANAGEMENT OVERVIEW OF OPERATIONS
Hollis Harris, chairman and CEO, noted, "We made outstanding progress in 2003 and built a strong foundation for our growth plans in 2004. I'm proud to say that we met or exceeded all our priorities for the year."
Harris cited the following accomplishments for 2003:
* Achieved profitability for the second consecutive year.
* Further diversified revenue mix, adding new passenger customers and
building cargo business.
* Increased revenue block hours by 16%.
* Increased revenue per block hour by 6.6%, with operating expense per
block hour rising only 2.1%.
* Initiated steps to reduce aircraft costs through lower lease expense.
* Restructured senior subordinated debt due in 2004 to meet the Air
Transportation Stabilization Board (ATSB) requirements for a federal
loan guarantee. Excluding the $18.0 million of convertible debentures
called on December 30, 2003, the Company now has $25.5 million in bonds
that come due in 2009 and $30 million in ATSB guaranteed debt with a
final maturity in 2008.
* Finalized a new contract with our flight attendants.
Harris added, "Last month, we reached a tentative agreement with our pilots that would extend that contract for three years, from January 1, 2004. During the course of 2004, we will continue to expand our passenger and cargo roster, maintain rigorous cost controls, and seek profitability for the third successive year. We also will continue exploring opportunities to reduce our aircraft lease costs over the next several years. Additionally, we hope to incorporate technological advances into our fleet, and our recent announcement of the installation of Sky Connect satellite telephone and data communications systems on our fleet of MD-11 aircraft is an example."
GUIDANCE
The Company is forecasting $110 to $120 million in revenue for the first quarter of 2004, with military revenue of $90 to $100 million, and operating income in the range of $7.5 to $8.5 million.
INVESTOR CONFERENCE CALL
February 9, 2004, at 4 P.M. EST
Phone: 888-399-4632
A conference call for investors will be held at 4 p.m. EST on Monday, February 9, 2004. Investors who wish to participate should call 888-399-4632 prior to the 4 p.m. start time. The call will be available for replay from 6 p.m. EST on Monday, February 9, to 6 p.m. EST on Tuesday, February 10. The replay number is 800-633-8284 and the reservation number is 21184537.
Utilizing a well-maintained fleet of international range, wide-body aircraft, World Airways has an enviable record of safety, reliability and customer service spanning more than 55 years. The Company is a U.S. certificated air carrier providing customized transportation services for major international passenger and cargo carriers, the United States military and international leisure tour operators. Recognized for its modern aircraft, flexibility and ability to provide superior service, World Airways meets the needs of businesses and governments around the globe. For more information, visit the Company's website at www.worldairways.com.
WORLD AIRWAYS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS AND YEAR ENDED DECEMBER 31,
(IN THOUSANDS EXCEPT PER SHARE & BLOCK HOUR DATA)
(PRELIMINARY -- SUBJECT TO COMPLETION OF YEAR-END AUDIT)
THREE MONTHS ENDED DECEMBER 31,
BETTER (WORSE)
2003 2002 DIFF %
OPERATING REVENUES
FLIGHT OPERATIONS $121,495 $99,692 $21,803 21.9%
ALL OTHER 787 436 351 80.5%
TOTAL OPERATING REVENUE 122,282 100,128 22,154 22.1%
OPERATING EXPENSES
FLIGHT 37,778 29,755 (8,023) -27.0%
MAINTENANCE 18,462 20,773 2,311 11.1%
AIRCRAFT COSTS 21,760 22,185 425 1.9%
FUEL 18,483 14,761 (3,722) -25.2%
FLIGHTS SUBCONTRACTED TO OTHER
CARRIERS 1,801 1,163 (638) -54.9%
COMMISSIONS 4,206 3,491 (715) -20.5%
DEPRECIATION & AMORTIZATION 1,199 1,019 (180) -17.7%
SALES, GENERAL & ADMINISTRATIVE 11,522 10,012 (1,510) -15.1%
AIRLINE STABILIZATION ACT GRANT - 1,952 1,952 N.M.
TOTAL OPERATING EXPENSES 115,211 105,111 (10,100) -9.6%
OPERATING INCOME (LOSS) 7,071 (4,983) 12,054 241.9%
OTHER INCOME (EXPENSE)
INTEREST EXPENSE (1,686) (1,251) (435) -34.8%
INTEREST INCOME 88 140 (52) -37.1%
OTHER, NET (4,450) (697) (3,753) -538.5%
TOTAL OTHER, NET (6,048) (1,808) (4,240) -234.5%
EARNINGS (LOSS) BEFORE INCOME TAX 1,023 (6,791) 7,814 115.1%
INCOME TAX 154 - (154) N.M.
NET EARNINGS (LOSS) $ 869 $(6,791) $ 7,660 112.8%
BASIC EARNINGS (LOSS) PER SHARE:
NET EARNINGS (LOSS) $ 0.08 $ (0.61) $ 0.69 113.1%
WEIGHTED AVERAGE SHARES
OUTSTANDING 11,417 11,077 340 3.1%
DILUTED EARNINGS (LOSS) PER SHARE:
NET EARNINGS (LOSS) $ 0.06 $ (0.61) $ 0.67 109.8%
WEIGHTED AVERAGE SHARES
OUTSTANDING 14,822 11,077 3,745 33.8%
REVENUE BLOCK HOURS 11,141 10,604 537 5.1%
YEAR ENDED DECEMBER 31,
BETTER (WORSE)
2003 2002 DIFF %
OPERATING REVENUES
FLIGHT OPERATIONS $471,824 $382,509 $89,315 23.3%
ALL OTHER 3,026 1,980 1,046 52.8%
TOTAL OPERATING REVENUE 474,850 384,489 90,361 23.5%
OPERATING EXPENSES
FLIGHT 143,640 116,012 (27,628) -23.8%
MAINTENANCE 75,513 59,628 (15,885) -26.6%
AIRCRAFT COSTS 85,487 86,834 1,347 1.6%
FUEL 76,488 57,864 (18,624) -32.2%
FLIGHTS SUBCONTRACTED TO OTHER
CARRIERS 2,454 2,087 (367) -17.6%
COMMISSIONS 17,433 15,834 (1,599) -10.1%
DEPRECIATION & AMORTIZATION 5,239 4,525 (714) -15.8%
SALES, GENERAL & ADMINISTRATIVE 40,168 32,631 (7,537) -23.1%
AIRLINE STABILIZATION ACT GRANT - 1,952 1,952 100.0%
TOTAL OPERATING EXPENSES 446,422 377,367 (69,055) -18.3%
OPERATING INCOME (LOSS) 28,428 7,122 21,306 299.2%
OTHER INCOME (EXPENSE)
INTEREST EXPENSE (5,223) (4,690) (533) -11.4%
INTEREST INCOME 370 575 (205) -35.7%
OTHER, NET (4,452) (966) (3,486) -360.9%
TOTAL OTHER, NET (9,305) (5,081) (4,224) -83.1%
EARNINGS (LOSS) BEFORE INCOME TAX 19,123 2,041 17,082 836.9%
INCOME TAX 3,802 - (3,802) N.M.
NET EARNINGS (LOSS) $ 15,321 $ 2,041 $13,280 650.7%
BASIC EARNINGS (LOSS) PER SHARE:
NET EARNINGS (LOSS) $ 1.37 $ 0.18 $ 1.19 661.1%
WEIGHTED AVERAGE SHARES
OUTSTANDING 11,224 11,073 151 1.4%
DILUTED EARNINGS (LOSS) PER SHARE:
NET EARNINGS (LOSS) $ 0.98 $ 0.18 $ 0.80 444.4%
WEIGHTED AVERAGE SHARES
OUTSTANDING 17,783 11,073 6,710 60.6%
REVENUE BLOCK HOURS 44,074 38,049 6,025 15.8%
WORLD AIRWAYS, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS )
December 31, December 31,
2003 2002
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 30,535 $ 20,839
Restricted cash 23,290 665
Accounts receivable, net 31,446 28,391
Prepaid expenses and other
current assets 7,721 5,569
Total current assets 92,992 55,464
Fixed assets, net 38,964 41,856
Long-term operating deposits 17,664 18,513
Other assets and deferred charges, net 7,681 1,429
Total assets $ 157,301 $ 117,262
LIABILITIES AND STOCKHOLDERS'
DEFICIENCY
Current liabilities:
Notes payable $ - $ 17,096
Current maturities of
convertible debentures 18,000 -
Accounts payable 28,167 30,497
Accrued rent 9,881 17,993
Unearned revenue 3,546 976
Accrued maintenance 2,791 2,178
Accrued salaries and wages 16,957 10,000
Accrued taxes 2,581 2,663
Other accrued liabilities 2,506 2,820
Total current liabilities 84,429 84,223
Long-term obligations, net of current
maturities 57,177 40,545
Deferred gain from sale-leaseback
transactions, net 2,777 3,909
Accrued post-retirement benefits 3,583 3,235
Deferred rent 16,008 14,217
Total liabilities 163,974 146,129
Stockholders' deficiency:
Preferred stock - -
Common stock 13 12
Additional paid-in capital 31,233 24,361
Accumulated deficit (25,062) (40,383)
Treasury stock, at cost (12,857) (12,857)
Total stockholders'
deficiency (6,673) (28,867)
Total liabilities and
stockholders' deficiency $ 157,301 $ 117,262 |
