Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 12, 2020 | Jun. 28, 2019 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Transition Report | false | ||
Entity File Number | 0-14719 | ||
Entity Registrant Name | SKYWEST INC | ||
Entity Incorporation, State or Country Code | UT | ||
Entity Tax Identification Number | 87-0292166 | ||
Entity Address, Address Line One | 444 South River Road | ||
Entity Address, City or Town | St. George | ||
Entity Address, State or Province | UT | ||
Entity Address, Postal Zip Code | 84790 | ||
City Area Code | 435 | ||
Local Phone Number | 634-3000 | ||
Title of 12(b) Security | Common Stock, No Par Value | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 3,157,616,762 | ||
Trading Symbol | SKYW | ||
Entity Common Stock, Shares Outstanding | 50,474,289 | ||
Entity Central Index Key | 0000793733 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 87,206 | $ 328,384 |
Marketable securities | 432,966 | 360,945 |
Income tax receivable | 11,141 | 25,936 |
Receivables, net | 82,977 | 64,194 |
Inventories, net | 110,503 | 127,690 |
Prepaid aircraft rents | 87,031 | |
Other current assets | 35,553 | 26,614 |
Total current assets | 760,346 | 1,020,794 |
PROPERTY AND EQUIPMENT: | ||
Aircraft and rotable spares | 7,078,801 | 6,433,916 |
Deposits on aircraft | 48,858 | 42,012 |
Buildings and ground equipment | 265,398 | 291,544 |
Total property and equipment, gross | 7,393,057 | 6,767,472 |
Less-accumulated depreciation and amortization | (1,998,376) | (1,761,728) |
Total property and equipment, net | 5,394,681 | 5,005,744 |
OTHER ASSETS | ||
Operating lease right-of-use assets | 336,009 | |
Long-term prepaid assets | 181,830 | |
Other long-term assets | 166,093 | 104,844 |
Total other assets | 502,102 | 286,674 |
Total assets | 6,657,129 | 6,313,212 |
CURRENT LIABILITIES: | ||
Current maturities of long-term debt | 364,126 | 350,206 |
Accounts payable | 284,473 | 331,982 |
Accrued salaries, wages and benefits | 133,856 | 161,606 |
Current maturities of operating lease liabilities | 94,806 | |
Taxes other than income taxes | 15,004 | 16,024 |
Other current liabilities | 32,411 | 65,008 |
Total current liabilities | 924,676 | 924,826 |
LONG-TERM DEBT, net of current maturities | 2,628,989 | 2,809,768 |
DEFERRED INCOME TAXES PAYABLE | 623,580 | 518,159 |
DEFERRED AIRCRAFT CREDITS | 29,308 | |
NONCURRENT OPERATING LEASE LIABILITIES | 259,237 | |
OTHER LONG-TERM LIABILITIES | 45,633 | 66,870 |
COMMITMENTS AND CONTINGENCIES (Note 5) | ||
STOCKHOLDERS' EQUITY: | ||
Preferred stock, 5,000,000 shares authorized; none issued | ||
Common stock, no par value, 120,000,000 shares authorized; 81,742,937 and 81,239,289 shares issued, respectively | 686,806 | 690,910 |
Retained earnings | 2,079,179 | 1,776,585 |
Treasury stock, at cost, 31,420,179 and 29,850,999 shares, respectively | (590,971) | (503,182) |
Accumulated other comprehensive loss | (32) | |
Total stockholders' equity | 2,175,014 | 1,964,281 |
Total liabilities and stockholders' equity | $ 6,657,129 | $ 6,313,212 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
CONSOLIDATED BALANCE SHEETS | ||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized | 120,000,000 | 120,000,000 |
Common stock, shares issued | 81,742,937 | 81,239,289 |
Treasury stock, at cost, shares | 31,420,179 | 29,850,999 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
OPERATING REVENUES: | |||
Total operating revenues | $ 2,971,963 | $ 3,221,679 | $ 3,122,592 |
OPERATING EXPENSES: | |||
Salaries, wages and benefits | 1,001,746 | 1,201,518 | 1,192,067 |
Depreciation and amortization | 368,098 | 334,589 | 292,768 |
Special items | 21,869 | ||
Other operating expenses | 243,729 | 272,826 | 250,778 |
Total operating expenses | 2,459,705 | 2,747,399 | 2,734,393 |
OPERATING INCOME | 512,258 | 474,280 | 388,199 |
OTHER INCOME (EXPENSE): | |||
Interest income | 14,131 | 8,823 | 4,509 |
Interest expense | (127,755) | (120,409) | (104,925) |
Other, net | 47,671 | 3,620 | 400 |
Total other expense, net | (65,953) | (107,966) | (100,016) |
INCOME BEFORE INCOME TAXES | 446,305 | 366,314 | 288,183 |
PROVISION (BENEFIT) FOR INCOME TAXES | 106,206 | 85,942 | (140,724) |
NET INCOME | $ 340,099 | $ 280,372 | $ 428,907 |
BASIC EARNINGS PER SHARE (in dollars per share) | $ 6.68 | $ 5.40 | $ 8.28 |
DILUTED EARNINGS PER SHARE (in dollars per share) | $ 6.62 | $ 5.30 | $ 8.08 |
Weighted average common shares: | |||
Basic (in shares) | 50,932,000 | 51,914,000 | 51,804,000 |
Diluted (in shares) | 51,375,000 | 52,871,000 | 53,100,000 |
COMPREHENSIVE INCOME: | |||
Net income | $ 340,099 | $ 280,372 | $ 428,907 |
Net unrealized appreciation on marketable securities, net of taxes | 32 | 18 | 21 |
TOTAL COMPREHENSIVE INCOME | 340,131 | 280,390 | 428,928 |
Flying agreements | |||
OPERATING REVENUES: | |||
Total operating revenues | 2,889,265 | 3,169,520 | 3,078,297 |
Airport customer service and other | |||
OPERATING REVENUES: | |||
Total operating revenues | 82,698 | 52,159 | 44,295 |
Aircraft maintenance, materials and repairs | |||
OPERATING EXPENSES: | |||
Total operating expenses | 514,313 | 556,259 | 579,463 |
Aircraft fuel | |||
OPERATING EXPENSES: | |||
Total operating expenses | 119,115 | 117,657 | 85,136 |
Airport related expenses | |||
OPERATING EXPENSES: | |||
Total operating expenses | 118,837 | 109,605 | 118,374 |
Aircraft rentals | |||
OPERATING EXPENSES: | |||
Total operating expenses | $ 71,998 | $ 154,945 | $ 215,807 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Common Stock | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Income (Loss) | Total |
Balance at Dec. 31, 2016 | $ 657,353 | $ 1,103,751 | $ (410,090) | $ (71) | $ 1,350,943 |
Balance (in shares) at Dec. 31, 2016 | 79,781 | (28,015) | |||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 428,907 | 428,907 | |||
Net unrealized appreciation on marketable securities, net of taxes | 21 | 21 | |||
Exercise of common stock options and stock issued under equity award plan | $ 1,658 | 1,658 | |||
Exercise of common stock options and stock issued under equity award plan (in shares) | 529 | ||||
Treasury shares acquired from vested employee stock awards for income tax withholdings | $ (5,080) | (5,080) | |||
Treasury shares acquired from vested employee stock awards for income tax withholdings (in shares) | (145) | ||||
Sale of common stock under employee stock purchase plan | $ 3,002 | 3,002 | |||
Sale of common stock under employee stock purchase plan (in shares) | 88 | ||||
Stock based compensation expense related to the issuance of equity awards | $ 10,580 | 10,580 | |||
Impact of adoption of ASU 2016-09 (See Note 1) | Accounting Standards Update 2016-09 | 867 | 867 | |||
Treasury stock purchases | $ (20,008) | (20,008) | |||
Treasury stock purchases (in shares) | (484) | ||||
Cash dividends declared | (16,568) | (16,568) | |||
Balance at Dec. 31, 2017 | $ 672,593 | 1,516,957 | $ (435,178) | (50) | 1,754,322 |
Balance (in shares) at Dec. 31, 2017 | 80,398 | (28,644) | |||
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 280,372 | 280,372 | |||
Net unrealized appreciation on marketable securities, net of taxes | 18 | 18 | |||
Exercise of common stock options and stock issued under equity award plan | $ 2,174 | 2,174 | |||
Exercise of common stock options and stock issued under equity award plan (in shares) | 780 | ||||
Treasury shares acquired from vested employee stock awards for income tax withholdings | $ (13,556) | (13,556) | |||
Treasury shares acquired from vested employee stock awards for income tax withholdings (in shares) | (239) | ||||
Sale of common stock under employee stock purchase plan | $ 3,038 | 3,038 | |||
Sale of common stock under employee stock purchase plan (in shares) | 61 | ||||
Stock based compensation expense related to the issuance of equity awards | $ 13,105 | 13,105 | |||
Treasury stock purchases | $ (54,448) | (54,448) | |||
Treasury stock purchases (in shares) | (968) | ||||
Cash dividends declared | (20,744) | (20,744) | |||
Balance at Dec. 31, 2018 | $ 690,910 | 1,776,585 | $ (503,182) | (32) | 1,964,281 |
Balance (in shares) at Dec. 31, 2018 | 81,239 | (29,851) | |||
Increase (Decrease) in Stockholders' Equity | |||||
Change in accounting principle and other (see Note 6) | Accounting Standards Update 2016-02 | (13,141) | (13,141) | |||
Balance, as adjusted | 1,763,444 | 1,951,140 | |||
Net income | 340,099 | 340,099 | |||
Net unrealized appreciation on marketable securities, net of taxes | $ 32 | 32 | |||
Exercise of common stock options and stock issued under equity award plan | $ 3,106 | 3,106 | |||
Exercise of common stock options and stock issued under equity award plan (in shares) | 707 | ||||
Treasury shares acquired from vested employee stock awards for income tax withholdings | $ (9,313) | (9,313) | |||
Treasury shares acquired from vested employee stock awards for income tax withholdings (in shares) | (173) | ||||
Sale of common stock under employee stock purchase plan | $ 3,165 | 3,165 | |||
Sale of common stock under employee stock purchase plan (in shares) | 65 | ||||
Stock based compensation expense related to the issuance of equity awards | $ 5,770 | 5,770 | |||
Common stock purchased and cancelled | $ (16,145) | (16,145) | |||
Common stock purchased and cancelled (in shares) | (268) | ||||
Treasury stock purchases | $ (78,476) | (78,476) | |||
Treasury stock purchases (in shares) | (1,396) | ||||
Cash dividends declared | (24,364) | (24,364) | |||
Balance at Dec. 31, 2019 | $ 686,806 | $ 2,079,179 | $ (590,971) | $ 2,175,014 | |
Balance (in shares) at Dec. 31, 2019 | 81,743 | (31,420) |
CONSOLIDATED STATEMENTS OF ST_2
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY | |||
Net unrealized appreciation on marketable securities, tax | $ 10 | $ 6 | $ 7 |
Cash dividends declared (in dollars per share) | $ 0.48 | $ 0.40 | $ 0.32 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income | $ 340,099 | $ 280,372 | $ 428,907 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 368,098 | 334,589 | 292,768 |
Stock based compensation expense | 10,274 | 13,105 | 10,580 |
Gain on sale of subsidiary | (46,525) | ||
Special items | 21,869 | ||
Net increase (decrease) in deferred income taxes | 109,654 | 99,139 | (145,517) |
Changes in operating assets and liabilities: | |||
Decrease in restricted cash | 8,243 | ||
Decrease (increase) in receivables | (40,700) | (21,464) | 4,201 |
Decrease (increase) in income tax receivable | 14,795 | (20,620) | 1,673 |
Increase in inventories | (4,303) | (7,935) | (1,246) |
Decrease in other current assets | 2,707 | 77,484 | 26,017 |
Increase in operating lease right-of-use asset | (895) | ||
Decrease in deferred aircraft credits | (14,243) | (8,520) | |
Increase (decrease) in accounts payable and other current liabilities | (54,043) | 62,107 | 67,018 |
NET CASH PROVIDED BY OPERATING ACTIVITIES | 721,030 | 802,534 | 684,124 |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Purchases of marketable securities | (1,938,750) | (2,308,768) | (1,533,867) |
Sales of marketable securities | 1,866,761 | 2,451,344 | 1,440,283 |
Net cash received from sale of subsidiary | 53,200 | ||
Acquisition of property and equipment: | |||
Aircraft and rotable spare parts | (581,329) | (1,062,380) | (661,176) |
Buildings and ground equipment | (80,586) | (34,397) | (27,467) |
Proceeds from the sale of aircraft, property and equipment | 26,008 | 51,994 | |
Deposits on aircraft | (52,817) | (41,937) | (46,733) |
Return of deposits applied towards acquired aircraft | 46,346 | 49,550 | 36,533 |
Decrease (increase) in other assets | 4,133 | (36,816) | (10,904) |
NET CASH USED IN INVESTING ACTIVITIES | (657,034) | (983,404) | (751,337) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Proceeds from issuance of long-term debt | 200,040 | 784,665 | 471,677 |
Principal payments on long-term debt | (382,442) | (370,775) | (330,258) |
Proceeds from issuance of common stock | 6,271 | 5,212 | 4,660 |
Purchase of treasury stock | (78,476) | (54,448) | (20,008) |
Purchase of common stock | (16,145) | ||
Employee income tax paid on vested equity awards | (9,313) | (13,556) | (5,080) |
Increase in debt issuance cost | (1,642) | (3,892) | (3,737) |
Payment of cash dividends | (23,467) | (19,744) | (15,015) |
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | (305,174) | 327,462 | 102,239 |
Increase (decrease) in cash and cash equivalents | (241,178) | 146,592 | 35,026 |
Cash and cash equivalents at beginning of period | 328,384 | 181,792 | 146,766 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | 87,206 | 328,384 | 181,792 |
Non-cash investing activities: | |||
Acquisition of rotable spare parts | 16,514 | 367 | 755 |
Debt assumed on aircraft acquired under operating leases | 14,475 | 59,132 | |
Engines contributed to joint venture | 22,313 | ||
Non-cash assets used to acquire aircraft under operating leases | 153,566 | ||
Lease liability arising from the recognition of right-of-use asset | 456,472 | ||
Cash paid during the period for: | |||
Interest, net of capitalized amounts | 131,733 | 118,268 | 105,639 |
Income taxes | 2,490 | $ 2,661 | $ 5,010 |
SUPPLEMENTAL DISCLOSURE OF SALE OF SUBSIDIARY: | |||
Decrease in carrying amount of assets | (101,448) | ||
Decrease in carrying amount of liabilities | 68,341 | ||
Cash received from buyers | 79,632 | ||
Gain on sale of subsidiary | $ 46,525 |
Nature of Operations and Summar
Nature of Operations and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Nature of Operations and Summary of Significant Accounting Policies | |
Nature of Operations and Summary of Significant Accounting Policies | (1) Nature of Operations and Summary of Significant Accounting Policies SkyWest, Inc. (the “Company”), through its subsidiary, SkyWest Airlines, Inc. (“SkyWest Airlines”) operates the largest regional airline in the United States. On January 22, 2019, the Company completed the sale of its former wholly owned subsidiary, ExpressJet Airlines, Inc. (“ExpressJet”). As of December 31, 2019, SkyWest Airlines offered scheduled passenger service under code-share agreements with Delta, United, American and Alaska with approximately 2,300 total daily departures to destinations in the United States, Canada, Mexico and the Caribbean. Additionally, the Company provides airport customer service and ground handling services for other airlines throughout its system. As of December 31, 2019, the Company had 483 aircraft in scheduled service out of a combined fleet of 544 aircraft consisting of the following: CRJ200 CRJ700 CRJ900 E175 Total Delta 84 13 43 59 199 United 99 19 — 65 183 American 7 62 — — 69 Alaska — — — 32 32 Aircraft in scheduled service 190 94 43 156 483 Subleased to an un-affiliated entity 4 10 5 — 19 Other* 20 22 — — 42 Total Fleet 214 126 48 156 544 *As of December 31, 2019, these aircraft have been removed from service and are in the process of being placed under a leasing arrangement with a third party, are aircraft transitioning between code-share agreements with the Company’s major airline partners and being used as a supplemental spare aircraft, or are in the process of being parted out. SkyWest Airlines has been a code-share partner with Delta since 1987, United since 1997, Alaska since 2011 and American since 2012. As of December 31, 2019, SkyWest Airlines operated as a Delta Connection carrier primarily in Salt Lake City and Minneapolis, a United Express carrier primarily in Los Angeles, San Francisco, Denver, Houston, Chicago and the Pacific Northwest, an American carrier primarily in Chicago, Los Angeles and Phoenix and an Alaska carrier primarily in the Pacific Northwest. SkyWest Airlines operates the following aircraft manufactured by Bombardier Aerospace (“Bombardier”): CRJ200s, CRJ700s and CRJ900s, and E175s manufactured by Embraer S.A. (“Embraer”). The CRJ200 is a single-class 50-seat aircraft. The CRJ700, CRJ900 E175 have seat Basis of Presentation The Company’s consolidated financial statements include the accounts of the Company and the SkyWest Airlines, ExpressJet (for the periods owned by the Company) and SkyWest Leasing segments, with all inter-company transactions and balances having been eliminated. In preparing the accompanying consolidated financial statements, the Company has reviewed, as determined necessary by the Company’s management, events that have occurred after December 31, 2019, through the filing date of the Company’s annual report with the U.S. Securities and Exchange Commission. The Company reclassified certain prior period amounts to conform to the current period presentation (see Recent Accounting Pronouncements). Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. The Company had no restricted cash as of December 31, 2019 and 2018. Marketable Securities The Company’s investments in debt securities are classified as available-for-sale and are reported at fair market value with the net unrealized appreciation reported as a component of accumulated other comprehensive income (loss) in stockholders’ equity. At the time of sale, any realized appreciation or depreciation, calculated by the specific identification method, is recognized in other income and expense. At December 31, 2019, the fair market value of the available-for-sale securities was the amortized cost. The Company’s position in marketable securities as of December 31, 2019 and 2018 was as follows (in thousands): Gross unrealized Gross unrealized At December 31, 2019 Amortized Cost holding gains holding losses Fair market value Total cash and cash equivalents $ 87,206 $ — $ — $ 87,206 Marketable securities: Bond and bond funds $ 267,243 $ — $ — $ 267,243 Commercial Paper 165,723 — — 165,723 Total marketable securities $ 432,966 $ — $ — $ 432,966 Total assets measured at fair value $ 520,172 $ — $ — $ 520,172 Gross unrealized Gross unrealized At December 31, 2018 Amortized Cost holding gains holding losses Fair market value Total cash and cash equivalents $ 328,384 $ — $ — $ 328,384 Marketable securities: Bond and bond funds $ 229,825 $ — $ (42) $ 229,783 Commercial Paper 131,163 — (1) 131,162 Total marketable securities $ 360,988 $ — $ (43) $ 360,945 Total assets measured at fair value $ 689,372 $ — $ (43) $ 689,329 Inventories Inventories include expendable parts, fuel and supplies and are valued at cost (FIFO basis) less an allowance for obsolescence based on historical results, excess parts and management’s expectations of future operations. Expendable inventory parts are charged to expense as used. An obsolescence allowance for flight equipment expendable parts is accrued based on estimated lives of the corresponding fleet types and salvage values. The inventory allowance as of December 31, 2019 and 2018 was $15.9 million and $22.1 million, respectively. Property and Equipment Property and equipment are stated at cost and depreciated over their useful lives to their estimated residual values using the straight-line method as follows: Assets Depreciable Life Current Residual Value Aircraft, rotable spares, and spare engines up to 22 years up to 20 % Ground equipment up to 10 years 0 % Office equipment up to 7 years 0 % Leasehold improvements Shorter of 15 years or lease term 0 % Buildings 20 - 39.5 years 0 % Impairment of Long-Lived Assets As of December 31, 2019, the Company had approximately $5.4 billion of property and equipment and related assets. In accounting for these long-lived and intangible assets, the Company makes estimates about the expected useful lives of the assets, the expected residual values of certain of these assets, and the potential for impairment based on the fair value of the assets and the cash flows they generate. Factors indicating potential impairment include, but are not limited to, significant decreases in the market value of the long-lived assets, a significant change in the condition of the long-lived assets and operating cash flow losses associated with the use of the long-lived assets. On a periodic basis, the Company evaluates whether impairment indicators are present. When considering whether or not impairment of long- lived assets exists, the Company groups similar assets together at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities and compare the undiscounted cash flows for each asset group to the net carrying amount of the assets supporting the asset group. Asset groupings are done at the fleet or contract level. The Company did not recognize any impairment charges of long-lived assets during the years ended December 31, 2019, 2018 and 2017. Capitalized Interest Interest is capitalized on aircraft purchase deposits as a portion of the cost of the asset and is depreciated over the estimated useful life of the asset. During the years ended December 31, 2019, 2018 and 2017, the Company capitalized interest costs of approximately $1.6 million, $1.5 million, and $1.4 million, respectively. Maintenance The Company operates under a U.S. Federal Aviation Administration approved continuous inspection and maintenance program. The Company uses the direct expense method of accounting for its regional jet engine overhauls wherein the expense is recorded when the overhaul event occurs. The Company has engine services agreements with third-party vendors to provide long-term engine services covering the scheduled and unscheduled repairs for most of its aircraft. Under the terms of the agreements, the Company pays a fixed dollar amount per engine hour flown on a monthly basis and the third-party vendors will assume the responsibility to repair the engines at no additional cost to the Company, subject to certain specified exclusions. Maintenance costs under these contracts are recognized when the engine hour is flown pursuant to the terms of each contract. The costs of maintenance for airframe and avionics components, landing gear and other recurring maintenance are expensed as incurred. Flying Agreements and Airport Customer Service and Other Revenues The Company recognizes flying agreements revenue and airport customer service and other revenues when the service is provided under its code-share agreements. Under the Company’s fixed-fee arrangements (referred to as “fixed-fee arrangements,” “fixed-fee contracts” or “capacity purchase agreements”) with Delta Air Lines, Inc. (“Delta”), United Airlines, Inc. (“United”), American Airlines, Inc. (“American”) and Alaska Airlines, Inc. (“Alaska”) (each, a “major airline partner”), the major airline partner generally pays the Company a fixed-fee for each departure, flight hour (measured from takeoff to landing, excluding taxi time) or block hour (measured from takeoff to landing, including taxi time) incurred, and an amount per aircraft in service each month with additional incentives based on flight completion and on-time performance. The major airline partner also directly pays for or reimburses the Company for certain direct expenses incurred under the fixed-fee arrangement, such as fuel, airport landing fees and airport rents. Under the fixed-fee arrangements, the Company’s performance obligation is met and revenue is recognized when each flight is completed and is reflected in flying agreements revenue. The transaction price for the fixed-fee agreements is determined from the fixed-fee consideration, incentive consideration and directly reimbursed expenses earned as flights are completed over the agreement term. For the year ended December 31, 2019, fixed-fee arrangements represented approximately Under the Company’s revenue-sharing arrangements (referred to as a “revenue-sharing” or “prorate” arrangement), the major airline partner and the Company negotiate a passenger fare proration formula, pursuant to which the Company receives a percentage of the ticket revenues for those passengers traveling for one portion of their trip on a Company airline and the other portion of their trip on the major airline partner. Under the Company’s prorate flying agreements, the performance obligation is met and revenue is recognized when each flight is completed based upon the portion of the prorate passenger fare the Company anticipates that it will receive for each completed flight. The transaction price for the prorate agreements is determined from the proration formula derived from each passenger ticket amount on each completed flight over the agreement term. For the year ended December 31, 2019, prorate flying arrangements represented approximately Airport customer service and other revenues primarily consist of ground handling functions, such as gate and ramp agent services at applicable airports where the Company provides such services. The transaction price for airport customer service agreements is determined from an agreed-upon rate by location applied to the applicable number of flights handled by the Company over the agreement term. Additionally, airport customer service and other revenues includes revenue generated from aircraft and spare engines leased to third parties. Of the Company’s $5.4 billion of property and equipment, net as of December 31, 2019, $97.0 million of regional jet aircraft and spare engines was leased to third parties under operating leases. The Company mitigates the residual asset risks of these assets by leasing aircraft and engine types that can be operated by the Company in the event of a default. A portion of the Company’s leases to third parties contain variable payments from lessees based on departures where the Company pays for maintenance. Additionally, the operating leases typically have specified lease return condition requirements paid by the lessee to the Company and the Company typically maintains inspection rights under the leases. The following table represents the Company’s airport customer service and other revenue for the years ended December 31, 2019, 2018 and 2017 (in thousands): For the year ended December 31, 2019 2018 2017 Airport customer service revenue $ 45,538 $ 48,236 $ 41,002 Operating lease income relating to lease payments 27,552 3,923 3,293 Operating lease income relating to variable lease payments 9,608 — — Airport customer service and other $ 82,698 $ 52,159 $ 44,295 The following table summarizes future minimum rental income under operating leases primarily related to leased aircraft that had remaining non-cancelable lease terms as of December 31, 2019 (in thousands): 2020 $ 32,724 2021 31,344 2022 24,786 2023 18,530 2024 18,222 Thereafter 54,932 $ 180,538 Other ancillary revenues commonly associated with airlines, such as baggage fee revenue, ticket change fee revenue and the marketing component of the sale of mileage credits, are retained by the Company’s major airline partners on flights that the Company operates under its code-share agreements. The following table represents the Company’s flying agreements revenue by type for the years ended December 31, 2019, 2018 and 2017 (in thousands): For the year ended December 31, 2019 2018 2017 Capacity purchase agreements revenue: flight operations $ 1,538,062 $ 1,856,253 $ 1,805,510 Capacity purchase agreements revenue: aircraft lease 830,247 814,518 834,366 Prorate agreements revenue 520,956 498,749 438,421 Flying agreements revenue $ 2,889,265 $ 3,169,520 $ 3,078,297 A portion of the Company’s compensation under its fixed-fee agreements is designed to reimburse the Company for certain aircraft ownership costs. The consideration for aircraft ownership costs varies by agreement but is intended to cover either the Company’s aircraft principal and interest debt service costs, its aircraft depreciation and interest expense or its aircraft lease expense costs while the aircraft is under contract. The consideration received for the use of the aircraft under the Company’s fixed-fee agreements is reflected as lease revenue, inasmuch as the agreements identify the “right of use” of a specific type and number of aircraft over a stated period of time. The lease revenue associated with the Company’s fixed-fee agreements is accounted for as an operating lease and is reflected as flying agreements revenue on the Company’s consolidated statements of comprehensive income. The Company has not separately stated aircraft rental income and aircraft rental expense in the consolidated statement of comprehensive income since the use of the aircraft is not a separate activity of the total service provided. The Company’s fixed-fee and prorate agreements include weekly provisional cash payments from the respective major airline partner based on a projected level of flying each month. The Company and each major airline partner subsequently reconcile these payments to the actual completed flight activity on a monthly or quarterly basis. In the event a flying agreement includes a mid-term rate reset to adjust rates prospectively and the contractual rates under the Company’s flying agreements have not been finalized at quarterly or annual financial statement dates, the Company applies the variable constraint guidance under Topic 606, where the Company records revenue to the extent it believes that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. In several of the Company’s agreements, the Company is eligible to receive incentive compensation upon the achievement of certain performance criteria. The incentives are defined in the agreements and are measured and determined on a monthly, quarterly or semi-annual basis. At the end of each period during the term of an agreement, the Company calculates the incentives achieved during that period and recognizes revenue attributable to that agreement accordingly, subject to the variable constraint guidance under Topic 606. The following summarizes the significant provisions of each code-share agreement the Company has with each major airline partner through SkyWest Airlines: Delta Connection Agreements Agreement Aircraft type Number of Aircraft Term / Termination Dates Delta Connection Agreement (fixed-fee arrangement) ● CRJ 200 ● CRJ 700 ● CRJ 900 ● E175 55 13 43 59 ● Individual aircraft have scheduled removal dates from 2020 to 2029 ● Delta Connection Prorate Agreement (revenue-sharing arrangement) ● CRJ 200 29 ● Terminable with 30-day United Express Agreements Agreement Aircraft type Number of Aircraft Term / Termination Dates United Express Agreements (fixed-fee arrangement) ● CRJ 200 ● CRJ 700 ● E175 68 19 65 ● Individual aircraft have scheduled removal dates under the agreement between 2020 and 2029 ● United Express Prorate Agreement (revenue-sharing arrangement) ● CRJ 200 31 ● Terminable with 120-day American Agreements Agreement Aircraft type Number of Aircraft Term / Termination Dates American Agreement (fixed-fee arrangement) ● CRJ 700 62 ● ● American Prorate Agreement (revenue-sharing arrangement) ● 7 ● 120-day Alaska Capacity Purchase Agreement Agreement Aircraft type Number of Aircraft Term / Termination Dates Alaska Agreement (fixed-fee arrangement) ● E175 32 ● ● In addition to the contractual arrangements described above, SkyWest Airlines has entered into fixed-fee agreements with Delta and American to place additional E175 aircraft into service. As of December 31, 2019, the Company was scheduled to take delivery of new E175 aircraft in connection with its agreement with American. The delivery dates for the new E175 aircraft are currently scheduled to be completed by the end of 2021. Final delivery dates may be adjusted based on various factors. Additionally, the Company is scheduled to add an additional six used E175 aircraft under the Delta agreement during 2020. SkyWest Airlines also entered into an agreement with Delta to place one CRJ900 aircraft under a nine-year fixed-fee agreement in 2020. SkyWest Airlines also entered into an agreement with American to place ten used CRJ700s under a multi-year contract. As of December 31, 2019, SkyWest Airlines had placed two of these CRJ700 aircraft into service with American. When an aircraft is scheduled to be removed from a fixed-fee arrangement, the Company may, as practical under the circumstances, negotiate an extension with the respective major airline partner, negotiate the placement of the aircraft with another major airline partner, return the aircraft to the lessor if the aircraft is leased and the lease is expiring, place owned aircraft for sale, or pursue other uses for the aircraft. Other uses for the aircraft may include placing the aircraft in a prorate arrangement, leasing the aircraft to a third party or parting out the aircraft to use the engines and parts as spare inventory or to lease the engines to a third party. Airport customer service and other revenues primarily consist of ground handling functions, such as gate and ramp agent services at applicable airports where the Company provides such services. The transaction price for airport service agreements is determined from an agreed-upon rate by location applied to the applicable number of flights handled (measured by departures) by the Company over the agreement term. The Company’s operating revenues could be impacted by a number of factors, including changes to the Company’s code-share agreements with its major airline partners, changes in flight schedules, contract modifications resulting from contract renegotiations, the Company’s ability to earn incentive payments contemplated under the Company’s code-share agreements and settlement of reimbursement disputes with the Company’s major airline partners. As of December 31, 2019, the Company had $83.0 million in accounts receivable of which $58.8 million related to flying agreements. As of December 31, 2018, the Company had $64.2 million in accounts receivable of which $52.7 million related to flying agreements. Income Taxes The Company recognizes a net liability or asset for the deferred tax consequences of all temporary differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements that are expected to result in taxable or deductible amounts in future years when the reported amounts of the assets and liabilities are recovered or settled. Net Income Per Common Share Basic net income per common share (“Basic EPS”) excludes dilution and is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted net income per common share (“Diluted EPS”) reflects the potential dilution that could occur if stock options or other contracts to issue common stock were exercised or converted into common stock. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an anti-dilutive effect on net income (loss) per common share. During the year ended December 31, 2019, 150,000 performance share units (at target performance) were excluded in the computation of Diluted EPS since the Company had not achieved the minimum target thresholds as of December 31, 2019. During the year ended December 31, 2018, 207,000 performance share units (at target performance) were excluded in the computation of Diluted EPS since the Company had not achieved the minimum target thresholds as of December 31, 2018. During the year ended December 31, 2017, 284,000 performance share units (at target performance) were excluded in the computation of Diluted EPS since the Company had not achieved the minimum target thresholds as of December 31, 2017. The calculation of the weighted average number of common shares outstanding for Basic EPS and Diluted EPS are as follows for the years ended December 31, 2019, 2018 and 2017 (in thousands): Year Ended December 31, 2019 2018 2017 Numerator: Net Income $ 340,099 $ 280,372 $ 428,907 Denominator: Basic earnings per share weighted average shares 50,932 51,914 51,804 Dilution due to stock options and restricted stock units 443 957 1,296 Diluted earnings per share weighted average shares 51,375 52,871 53,100 Basic earnings per share $ 6.68 $ 5.40 $ 8.28 Diluted earnings per share $ 6.62 $ 5.30 $ 8.08 Comprehensive Income (Loss) Comprehensive income (loss) includes charges and credits to stockholders’ equity that are not the result of transactions with the Company’s shareholders, including changes in unrealized appreciation on marketable debt securities. Fair Value of Financial Instruments The carrying amounts reported in the consolidated balance sheets for receivables and accounts payable approximate fair values because of the immediate or short-term maturity of these financial instruments. Marketable securities are reported at fair value based on market quoted prices in the consolidated balance sheets. If quoted prices in active markets are no longer available, the Company has estimated the fair values of these securities utilizing a discounted cash flow analysis. These analyses consider, among other items, the collateralization underlying the security investments, the creditworthiness of the counterparty, the timing of expected future cash flows, and the expectation of the next time the security is expected to have a successful auction. The fair value of the Company’s long-term debt is estimated based on current rates offered to the Company for similar debt and was approximately $3,049.1 million as of December 31, 2019, as compared to the carrying amount of $3,017.5 million as of December 31, 2019. The Company’s fair value of long-term debt as of December 31, 2018 was $3,157.3 million as compared to the carrying amount of $3,185.4 million as of December 31, 2018. Segment Reporting Generally accepted accounting principles require disclosures related to components of a company for which separate financial information is available to, and regularly evaluated by, the Company’s chief operating decision maker when deciding how to allocate resources and in assessing performance. The Company’s three operating segments (prior to the sale of ExpressJet in January 2019) consist of the operations conducted by SkyWest Airlines, ExpressJet (for the periods owned by the Company) and SkyWest Leasing. Following the sale of ExpressJet, the Company has two reportable segments: SkyWest Airlines and SkyWest Leasing. Information pertaining to the Company’s reportable segments is presented in Note 2, Segment Reporting Recent Accounting Pronouncements Standards Effective in Future Years and Not Yet Adopted In June 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments” (“Topic 326”), which requires measurement and recognition of expected credit losses for financial assets held and requires enhanced disclosure regarding significant estimates and judgments used in estimating credit losses. Topic 326 is effective for the Company beginning January 1, 2020. The Company will adopt Topic 326, on January 1, 2020. The Company’s primary financial assets as of December 31, 2019, include trade receivables from its flying agreements, notes and other receivables from third parties. The Company estimates it will record a credit loss amount between Recently Adopted Standards In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)” (“Topic 842”). Topic 842 and subsequently issued amendments require certain leases with durations longer than 12 months to be recognized on the balance sheet. The Company adopted Topic 842 effective January 1, 2019 and elected the package of transition practical expedients for expired or existing contracts, which does not require reassessment of: (1) whether any of the Company’s contracts are or contain leases, (2) lease classification and (3) initial direct costs. In July 2018, the FASB issued ASU No. 2018-11, “Targeted Improvements - Leases (Topic 842).” This update provides an optional transition method that allows entities to elect to apply the standard using the modified retrospective approach at its effective date, versus recasting the prior years presented. If this adoption method is elected, an entity would recognize a cumulative-effect adjustment to the opening balance of retained earnings in the year of adoption. The Company elected this adoption method and recognized a cumulative-effect adjustment to the opening balance of retained earnings on January 1, 2019. Additionally, the Company’s adoption of Topic 842 did not have a significant impact on the recognition, measurement or presentation of lease revenue and lease expenses within the condensed consolidated statements of operations and comprehensive income or the condensed consolidated statements of cash flows. The Company’s adoption of Topic 842 did not have a material impact on the timing or amount of the Company’s lease revenue as a lessor. The Company’s prepaid aircraft rents, accrued aircraft rents and deferred rent credits that were separately stated in the Company’s December 31, 2018 balance sheet have been classified as a component of the Company’s right-of-use assets effective January 1, 2019. The consolidated financial statements for 2019 are presented under the new standard, while comparative years presented are not adjusted and continue to be reported in accordance with the Company’s historical accounting policy. See Note 6, " Leases |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting | |
Segment Reporting | (2) Segment Reporting Generally accepted accounting principles require disclosures related to components of a company for which separate financial information is available to, and regularly evaluated by, the Company’s chief operating decision maker when deciding how to allocate resources and in assessing performance. Prior to the Company’s sale of ExpressJet on January 22, 2019, the Company’s three reporting segments consisted of the operations of SkyWest Airlines, ExpressJet and SkyWest Leasing activities. The segment information presented for ExpressJet reflects the period of time prior to the sale, when ExpressJet was operating as a subsidiary of the Company. The Company’s chief operating decision maker analyzes the profitability of operating new aircraft financed through the issuance of debt, including the Company’s E175 fleet, separately from the profitability of the Company’s capital deployed for ownership and financing of such aircraft. The SkyWest Airlines segment includes revenue earned under the applicable fixed-fee contracts attributed to operating such aircraft and the respective operating costs. The SkyWest Leasing segment includes applicable revenue earned under the applicable fixed-fee contracts attributed to the ownership of new aircraft acquired through the issuance of debt and the respective depreciation and interest expense of such aircraft. The SkyWest Leasing segment also includes the activity of leasing regional jet aircraft and spare engines to third parties. The SkyWest Leasing segment’s total assets and capital expenditures include new aircraft acquired through the issuance of debt and assets leased to third parties. The following represents the Company’s segment data for the years ended December 31, 2019, 2018 and 2017 (in thousands). Year Ended December 31, 2019 SkyWest Airlines ExpressJet SkyWest Leasing Consolidated Operating revenues $ 2,478,681 $ 24,050 $ 469,232 $ 2,971,963 Operating expense 2,214,632 28,690 216,383 2,459,705 Depreciation and amortization expense 168,246 971 198,881 368,098 Special items 18,508 3,361 — 21,869 Interest expense 13,525 — 114,230 127,755 Segment profit (loss) (1) 250,524 (4,640) 138,619 384,503 Total assets 2,728,964 — 3,928,165 6,657,129 Capital expenditures (including non-cash) 270,191 — 576,279 846,470 Year Ended December 31, 2018 SkyWest Airlines ExpressJet SkyWest Leasing Consolidated Operating revenues $ 2,346,251 $ 564,202 $ 311,226 $ 3,221,679 Operating expense 2,022,560 577,608 147,231 2,747,399 Depreciation and amortization expense 155,511 37,290 141,788 334,589 Interest expense 17,021 2,340 101,048 120,409 Segment profit (loss) (1) 306,670 (15,746) 62,947 353,871 Total assets 2,531,707 279,303 3,502,202 6,313,212 Capital expenditures (including non-cash) 149,731 10,137 996,408 1,156,276 Year Ended December 31, 2017 SkyWest Airlines ExpressJet SkyWest Leasing Consolidated Operating revenues $ 2,092,368 $ 790,282 $ 239,942 $ 3,122,592 Operating expense 1,807,540 818,683 108,170 2,734,393 Depreciation and amortization expense 134,563 51,982 106,223 292,768 Interest expense 21,544 4,127 79,254 104,925 Segment profit (loss) (1) 263,284 (32,528) 52,518 283,274 Identifiable intangible assets, other than goodwill — 4,896 — 4,896 Total assets 2,245,051 599,122 2,630,227 5,474,400 Capital expenditures (including non-cash) 124,955 14,278 550,165 689,398 (1) Segment profit is operating income less interest expense |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2019 | |
Long-Term Debt | |
Long-Term Debt | (3) Long-term Debt Long-term debt consisted of the following as of December 31, 2019 and 2018 (in thousands): December 31, December 31, 2019 2018 Notes payable to banks, due in semi-annual installments, variable interest based on LIBOR, or with an interest rate of 4.00% through 2019, secured by aircraft $ — $ 6,429 Notes payable to a financing company, due in semi-annual installments, with a fixed interest rate of 3.25% through 2021, secured by aircraft 18,412 36,324 Notes payable to banks, due in semi-annual installments plus interest at 6.10% to 6.51% through 2021, secured by aircraft 22,557 41,592 Notes payable to banks, due in monthly installments, plus interest at 1.95% to 6.86% through 2029, secured by aircraft 438,878 476,369 Notes payable to banks, due in quarterly installments, plus interest at 3.39% to 5.08% through 2031, secured by aircraft 2,537,676 2,621,416 Notes payable to banks due in monthly installments, interest at 3.30% through 2019, secured by spare engines — 3,308 Long-term debt $ 3,017,523 $ 3,185,438 Current portion of long-term debt (367,954) (354,072) Less long-term portion of unamortized debt issue cost, net (20,580) (21,598) Long-term debt, net of current maturities and debt issue costs $ 2,628,989 $ 2,809,768 Current portion of long-term debt 367,954 354,072 Less current portion of unamortized debt issue cost, net (3,828) (3,866) Current portion of long-term debt, net of debt issue costs $ 364,126 $ 350,206 During the year ended December 31, 2019, the Company took delivery of ten E175 aircraft that the Company financed through $200.0 million of long-term debt. The debt associated with the ten E175 aircraft has a 12-year As of December 31, 2019 and 2018, the Company had $3.0 billion and $3.2 billion, respectively, of long-term debt obligations primarily related to the acquisition of aircraft and certain spare engines. The average effective interest rate on the debt related to those long-term debt obligations at December 31, 2019 and 2018, was approximately 4.2%. During the year ended December 31, 2019, the Company used $30.1 million in cash to extinguish $30.1 million in debt early. During the year ended December 31, 2018, the Company used $43.5 million in cash to extinguish $43.5 million in debt early. These payments did not result in a pre-tax gain or loss in the consolidated statements of comprehensive income. The aggregate amounts of principal maturities of long-term debt as of December 31, 2019 were as follows (in thousands): 2020 $ 367,954 2021 352,005 2022 365,907 2023 374,906 2024 327,630 Thereafter 1,229,121 $ 3,017,523 As of December 31, 2019 and 2018, SkyWest Airlines had a $75 million line of credit. The line of credit includes minimum liquidity and profitability covenants and is secured by certain assets. As of December 31, 2019, the Company was in compliance with the line of credit covenants. As of December 31, 2019 and 2018, SkyWest Airlines had no amount outstanding under the facility. However, at December 31, 2019 and 2018 the Company had $8.8 million and $9.7 million, respectively, in letters of credit issued under the facility which reduced the amount available under the facility to $66.2 million and $65.3 million, respectively. The facility expires on September 1, 2021 and has a variable interest rate of LIBOR plus 2.5% at December 31, 2019. As of December 31, 2019 and 2018, the Company had $61.7 million and $78.7 million, respectively, in letters of credit and surety bonds outstanding with various banks and surety institutions in addition to the letters of credit outstanding under the line of credit. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes | |
Income Taxes | (4) Income Taxes The provision (benefit) for income taxes includes the following components (in thousands): Year ended December 31, 2019 2018 2017 Current tax provision (benefit): Federal $ (4,395) $ (21,598) $ 5,853 State 891 1,465 180 Foreign — 1,575 — (3,504) (18,558) 6,033 Deferred tax provision (benefit): Federal 95,655 92,250 (166,890) State 14,055 12,250 20,133 109,710 104,500 (146,757) Provision (benefit) for income taxes $ 106,206 $ 85,942 $ (140,724) The following is a reconciliation between a federal income tax rate of 21% in 2019 and 2018 and 35% for 2017 of income before income taxes and the effective tax rate which is derived by dividing the provision (benefit) for income taxes by the income before the provision for income taxes (in thousands): Year ended December 31, 2019 2018 2017 Computed provision for income taxes at the statutory rate $ 93,724 $ 76,926 $ 100,864 Increase (decrease) in income taxes resulting from: State income tax provision, net of federal income tax benefit 15,645 12,711 7,778 Non-deductible expenses 3,934 1,956 3,230 Valuation allowance changes affecting the provision for income taxes (517) (1,187) 505 Foreign income taxes, net of federal & state benefit — 1,192 — Excess tax benefits from share-based compensation (3,525) (4,548) (5,377) Revaluation of net deferred taxes for the Tax Cuts and Jobs Act of 2017 — — (246,845) Other, net (3,055) (1,108) (879) Provision (benefit) for income taxes $ 106,206 $ 85,942 $ (140,724) For the year ended December 31, 2019, the Company released $0.5 million of valuation allowance against certain deferred tax assets primarily associated with ExpressJet state net operating losses. For the year ended December 31, 2018, the Company released million valuation allowance, respectively against certain deferred tax assets primarily associated with ExpressJet state net operating losses with a limited carry forward period and Company capital losses with a limited carry forward period. For the year ended December 31, 2017, the Company recorded million of valuation allowance against certain deferred tax assets primarily associated with ExpressJet state net operating losses. The decrease in the valuation allowance for 2019 was primarily based on changes in the Company's income tax projections which reduced the amount of deferred tax assets that are anticipated to expire before the deferred tax assets may be utilized. The Company recorded a $3.5 million, $4.5 million and $5.4 million benefit from share-based compensation in 2019, 2018 and 2017, respectively, relating to ASU 2016-09 which, requires excess tax benefits and deficiencies to be recognized in the income tax provision during the period stock options are exercised and when stock awards vest. The significant components of the Company’s net deferred tax assets and liabilities as of December 31, 2019 and 2018 are as follows (in thousands): As of December 31, 2019 2018 Deferred tax assets: Accrued benefits $ 20,848 $ 32,462 Net operating loss carryforward 358,685 344,375 AMT credit carryforward 4,397 15,744 Aircraft credits 9,114 35,924 Accrued reserves and other 17,225 18,710 Total deferred tax assets 410,269 447,215 Valuation allowance (892) (9,455) Deferred tax liabilities: Accelerated depreciation (1,032,957) (955,919) Total deferred tax liabilities (1,032,957) (955,919) Net deferred tax liability $ (623,580) $ (518,159) The Company's valuation allowance is related to certain deferred tax assets with a limited carry forward period where the Company does not anticipate utilizing these deferred tax assets prior to the lapse of the carry forward period. The Company's AMT credit carryforward includes credits from prior acquisitions. At %, respectively. The Company anticipated that the federal and state net operating losses will start to expire in 2030 and 2020, respectively. The Company has recorded a valuation allowance for state net operating losses the Company anticipates will expire before the benefit will be realized due to the limited carry forward periods. As of December 31, 2019 and 2018, the Company also had an alternative minimum tax credit of approximately $4.4 million and $8.8 million, respectively, which does not expire. Under the Tax Cuts and Jobs Act of 2017, the Company will realize the alternative minimum tax credit either by offsetting regular tax due or as a refundable credit over the next two years . The Company has no ongoing federal or state examinations. Federal tax years 2016, 2017 and 2018 are open to examination. Under ASC Topic 740, the accounting guidance related to uncertainty in tax positions requires that the impact of a tax position be recognized in the financial statements if that position is more likely than not of being sustained on audit, based on the technical merits of the position. A reconciliation of the beginning and ending amount of unrecognized tax benefits for the year ended December 31, 2019 and 2018 is as follows (in thousands) : As of December 31, 2019 2018 Unrecognized tax benefits at the beginning of year $ 14,553 $ 2,223 Gross increases - current year tax positions — 13,899 Gross increases - prior year tax positions 67 — Gross decreases - prior year tax positions — (1,569) Unrecognized tax benefits at end of year $ 14,620 $ 14,553 Interest and penalties in year-end balance $ 67 $ — For the year ending December 31, 2019, the Company has recorded $67,000 of interest expense related to uncertain tax positions not offset by the Company's tax attributes. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies | |
Commitments and Contingencies | (5) Commitments and Contingencies Self-Insurance The Company self-insures a portion of its potential losses from claims related to workers’ compensation, environmental issues, property damage, medical insurance for employees and general liability. Losses are accrued based on an estimate of the ultimate aggregate liability for claims incurred, using standard industry practices and the Company’s actual experience. The Company uses judgment and estimates in determining the ultimate aggregate liabilities for claims incurred in its workers’ compensation liability. The Company also used significant assumptions in determining the workers compensation liability such as an estimation of loss payment and loss reporting development patterns. At December 31, 2019 and 2018, the Company’s accrued workers’ compensation liability totaled $23.9 million and $42.0 million, respectively. Actual results could differ from these estimates. Legal Matters The Company is subject to certain legal actions which it considers routine to its business activities. As of December 31, 2019, management believed, after consultation with legal counsel, that the ultimate outcome of such legal matters was not likely to have a material adverse effect on the Company’s financial position, liquidity or results of operations. Concentration Risk and Significant Customers The Company requires no collateral from its major airline partners or customers, but monitors the financial condition of its major airline partners. Under the majority of the Company’s code-share agreements, the Company receives weekly payments from its major code-share partners that approximate a significant percentage of the compensation earned for such period. Additionally, the Company provides certain customer service functions at multiple airports for various airlines and the Company maintains an allowance for doubtful accounts receivable based upon expected collectability of all accounts receivable. The Company’s allowance for doubtful accounts totaled $18,000 and $158,000 as of December 31, 2019 and 2018, respectively. For the years ended December 31, 2019, 2018 and 2017, the Company’s contractual relationships with Delta and United combined accounted for approximately 77.6%, 81.4% and 82.9%, respectively of the Company’s total revenues. Employees Under Collective Bargaining Agreements As of December 31, 2019, the Company had approximately 13,700 full- time equivalent employees. Although |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases | |
Leases | (6) Leases Effective January 1, 2019, the Company adopted Topic 842. The Company leases property and equipment under operating leases. For leases with durations longer than 12 months, the Company recorded the related operating lease right-of-use asset and operating lease liability at the present value of lease payments over the term. The Company used its incremental borrowing rate to discount the Aircraft During the first quarter of 2019, the Company acquired 52 CRJ aircraft under an early lease buyout arrangement with the lessor for $111.7 million. During the third quarter of 2019, the Company acquired four CRJ900 aircraft under an early lease buyout arrangement with the lessor for $30.0 million. With the adoption of Topic 842, the Company evaluated whether leased aircraft asset groups within the Company’s fleet were impaired. Under the transition guidance for Topic 842, a company is permitted to recognize a previously unrecognized impairment related to a right-of-use asset in the period prior to the adoption date of Topic 842 if the event giving rise to the impairment occurred before the adoption date. In 2016, the Company recorded an impairment on certain of its long-lived assets, which included the Company’s CRJ200 aircraft . In 2016, the market lease rate was less than the contractual lease rate on the Company’s CRJ200 leased aircraft. The Company recorded an impairment of Airport facilities The Company has operating leases for facility space including airport terminals, office space, cargo warehouses and maintenance facilities. The Company generally leases this space from government agencies that control the use of the airport. The remaining lease terms for facility space vary from one month to 37 years. The Company’s operating leases with lease rates that are variable based on airport operating costs, use of the facilities or other variable factors are excluded from the Company’s right-of-use assets and operating lease liabilities in accordance with accounting guidance. Leases As of December 31, 2019, the Company’s right-of-use assets were $336.0 million, the Company’s current maturities of operating lease liabilities were $94.8 million, and the Company’s noncurrent lease liabilities were $259.2 million. During 2019, the Company paid $75.4 million in operating leases reflected as a reduction from operating cash flows. The table below presents lease related terms and discount rates as of December 31, 2019. As of December 31, 2019 Weighted-average remaining lease term Operating leases 6.84 years Weighted-average discount rate Operating leases 6.4% The Company’s lease costs for 2019 and 2018 included the following components (in thousands): For the year ended December 31, 2019 2018 Operating lease cost $ 104,011 $ 185,337 Variable and short-term lease cost 5,232 5,143 Sublease income (1,436) — Total lease cost $ 107,807 $ 190,480 property and equipment under non-cancelable operating leases, which are generally on a long-term, triple-net lease basis pursuant to which the Company pays taxes, maintenance, insurance and certain other operating expenses applicable to the leased property. The Company expects that, in the normal course of business, such operating leases that expire will be renewed or replaced by other leases, or the property may be purchased rather than leased. The following table summarizes future minimum rental payments primarily related to leased aircraft required under operating leases that had initial or remaining non-cancelable lease terms as of December 31, 2019 (in thousands): 2020 $ 94,806 2021 84,285 2022 73,960 2023 68,581 2024 27,282 Thereafter 94,746 $ 443,660 The majority of the Company’s leased aircraft are owned and leased through trusts whose sole purpose is to purchase, finance and lease these aircraft to the Company (“Leveraged Lease Agreements”). The Company is not a beneficiary of such trusts and the Company does not have an ownership interest in such trusts. The Company’s leveraged leases do not require the Company to guarantee a portion of the residual values of the leased assets held by the trust and the Company’s leveraged lease agreements do not contain a fixed purchase option or have any other terms that represent variable interests in such trusts. As a result, the Company has not consolidated any of these trusts. Total rental expense for non-cancelable aircraft operating leases was approximately $72.0 million, $154.9 million and $215.8 million for the years ended December 31, 2019, 2018 and 2017, respectively. The minimum rental expense for airport station rents was approximately $23.1 million, $19.6 million and $30.3 million for the years ended December 31, 2019, 2018 and 2017, respectively. Disclosures related to periods prior to the adoption of the New Lease Standard 2019 $ 87,256 2020 101,741 2021 90,787 2022 72,593 2023 65,749 Thereafter 59,820 $ 477,946 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Measurements | |
Fair Value Measurements | (7) Fair Value Measurements The Company holds certain assets that are required to be measured at fair value in accordance with GAAP. The Company determined fair value of these assets based on the following three levels of inputs: Level 1 Level 2 Level 3 As of December 31, 2019, the Company held certain assets that are required to be measured at fair value on a recurring basis. Assets measured at fair value on a recurring basis are summarized below (in thousands): Fair Value Measurements as of December 31, 2019 Total Level 1 Level 2 Level 3 Marketable Securities Bonds and bond funds $ 267,243 $ — $ 267,243 $ — Commercial paper 165,723 — 165,723 — $ 432,966 $ — $ 432,966 $ — Cash, Cash Equivalents and Restricted Cash 87,206 87,206 — — Total Assets Measured at Fair Value $ 520,172 $ 87,206 $ 432,966 $ — Fair Value Measurements as of December 31, 2018 Total Level 1 Level 2 Level 3 Marketable Securities Bonds and bond funds $ 229,783 $ — $ 229,783 $ — Commercial paper 131,162 — 131,162 — $ 360,945 $ — $ 360,945 $ — Cash, Cash Equivalents and Restricted Cash 328,384 328,384 — — Total Assets Measured at Fair Value $ 689,329 $ 328,384 $ 360,945 $ — The Company’s “Marketable Securities” classified as Level 2 primarily utilize broker quotes in a non-active market for valuation of these securities. No significant transfers between Level 1, Level 2 and Level 3 occurred during the year ended December 31, 2019. The Company’s policy regarding the recording of transfers between levels is to record any such transfers at the end of the reporting period. |
Special Items
Special Items | 12 Months Ended |
Dec. 31, 2019 | |
Special Items | |
Special Items | (8) Special Items The following table summarizes the components of the Company's special items, for the year ended December 31, 2019, 2018 and 2017 (in thousands): Year ended December 31, 2019 2018 2017 Special items: Parts credit 1 $ 18,508 $ — $ — Employee severance 2 3,361 — — Total special items $ 21,869 $ — $ — (1) The Company terminated an agreement with an aircraft manufacturer that obligated the Company to future aircraft lease return conditions on aircraft the Company leased. In conjunction with the terminated agreement, the aircraft manufacturer released the Company from the future aircraft lease return obligations and the Company agreed to terminate aircraft part credits previously issued by the manufacturer to the Company. As a result of the terminated agreement, the Company recorded a non-cash expense of $18.5 million (pre-tax) during 2019 to write-off the terminated aircraft part credits, which was reflected as a special items operating expense in the consolidated statement of comprehensive income. These special items are reflected in the SkyWest Airlines operating expenses under Note 2 Segment Reporting . (2) During 2019, the Company incurred $3.4 million of employee severance related costs associated with the sale of ExpressJet that are also reflected in special items. These special items are reflected in the ExpressJet operating expenses under Note 2 Segment Reporting . |
Capital Transactions
Capital Transactions | 12 Months Ended |
Dec. 31, 2019 | |
Capital Transactions | |
Capital Transactions | (9) Capital Transactions Preferred Stock The Company is authorized to issue 5,000,000 shares of preferred stock in one or more series without shareholder approval. No shares of preferred stock are presently outstanding. The Company’s Board of Directors is authorized, without any further action by the shareholders of the Company, to (i) divide the preferred stock into series; (ii) designate each such series; (iii) fix and determine dividend rights; (iv) determine the price, terms and conditions on which shares of preferred stock may be redeemed; (v) determine the amount payable to holders of preferred stock in the event of voluntary or involuntary liquidation; (vi) determine any sinking fund provisions; and (vii) establish any conversion privileges. Stock Compensation On May 7, 2019, the Company’s shareholders approved the adoption of the SkyWest, Inc. 2019 Long-Term Incentive Plan, which provides for the issuance of up to 4,500,000 shares of common stock to the Company’s directors, employees, consultants and advisors (the “2019 Incentive Plan”). The 2019 Incentive Plan provides for awards in the form of options to acquire shares of common stock, stock appreciation rights, restricted stock grants, restricted stock units and performance awards. The 2019 Incentive Plan is administered by the Compensation Committee of the Company’s Board of Directors (the “Compensation Committee”). As of December 31, 2019, the 2019 Incentive Plan had 4.4 million shares remaining available for future issuance. Stock Options The fair value of stock options awarded under the Company’s stock option plans has been estimated as of the grant date using the Black-Scholes option pricing model. The Company uses historical data to estimate option exercises and employee termination in the option pricing model. The expected term of options granted is derived from the output of the option pricing model and represents the period of time that options granted are expected to be outstanding. The expected volatilities are based on the historical volatility of the Company’s traded stock and other factors. During the years ended December 31, 2019, 2018 and 2017, the Company did not grant any options to purchase shares of common stock. Options are exercisable for a period as defined by the Compensation Committee on the date granted; however, no stock option will be exercisable before six months have elapsed from the date of grant and no stock option shall be exercisable after seven years from the date of grant. The following table summarizes the stock option activity for all of the Company’s plans for the years ended December 31, 2019, 2018 and 2017. 2019 2018 2017 Weighted Weighted Average Aggregate Weighted Weighted Average Remaining Intrinsic Average Average Number of Exercise Contractual Value Number of Exercise Number of Exercise Options Price Term ($000) Options Price Options Price Outstanding at beginning of year 300,580 $ 13.70 3.0 years $ 9,249.4 458,103 $ 13.73 819,981 $ 13.58 Granted — — — — — — Exercised (232,514) 13.36 (157,523) 13.80 (356,209) 13.36 Cancelled (7,835) 15.86 — — (5,669) 14.33 Outstanding at end of year 60,231 14.74 3.1 years $ 3,005.1 300,580 13.70 458,103 13.73 Exercisable at December 31, 2019 60,231 14.74 3.1 years $ 3,005.1 Exercisable at December 31, 2018 235,672 13.36 2.7 years $ 7,330.7 The total intrinsic value of options to acquire shares of the Company’s common stock that were exercised during the years ended December 31, 2019, 2018 and 2017 was $10.5 million, $7.1 million and $9.94 million, respectively. The following table summarizes the status of the Company’s non-vested stock options as of December 31, 2019: Weighted-Average Number of Grant-Date Shares Fair Value Non-vested shares at beginning of year 64,908 $ 5.32 Granted — — Vested (57,073) 5.27 Cancelled (7,835) 5.66 Non-vested shares at end of year — $ — The following table summarizes information about the Company’s stock options outstanding at December 31, 2019: Options Outstanding Options Exercisable Weighted Average Number Remaining Weighted Average Number Weighted Average Range of Exercise Prices Outstanding Contractual Life Exercise Price Exercisable Exercise Price $13.00 to $13.99 2,034 2.1 years $ 13.51 2,034 $ 13.51 $14.00 to $15.00 58,197 3.1 years 14.78 58,197 14.78 $13.00 to $15.00 60,231 3.1 years $ 14.74 60,231 $ 14.74 Restricted Stock Units During the year ended December 31, 2019, the Company granted 104,120 The following table summarizes the activity of restricted stock units granted to certain Company employees for the years ended December 31, 2019, 2018 and 2017: Weighted-Average Grant-Date Fair Number of RSUs Value Non-vested RSUs outstanding at December 31, 2016 926,931 $ 13.65 Granted 160,137 35.81 Vested (230,903) 12.01 Cancelled (40,575) 15.78 Non-vested RSUs outstanding at December 31, 2017 815,590 $ 18.35 Granted 115,044 53.40 Vested (330,580) 13.57 Cancelled (24,273) 27.77 Non-vested RSUs outstanding at December 31, 2018 575,781 $ 27.71 Granted 104,120 48.65 Vested (251,853) 14.79 Cancelled (143,362) 30.85 Non-vested RSUs outstanding at December 31, 2019 284,686 $ 45.21 Performance Stock Units During the year ended December 31, 2019, the Compensation Committee granted performance share units, which are performance based restricted stock units, to certain Company employees with three-year performance-based financial metrics that the Company must meet before those awards may be earned and the performance period is measured for the three years ending December 31, 2021. The Company’s compensation expense for performance share units is based upon the projected number of performance share units estimated to be awarded at the conclusion of the performance period. During 2019, the Compensation Committee awarded 67,853 additional shares of stock related to the performance share grant in 2016 based on the Company’s performance for the three years ended December 31, 2018 measured against the pre-established targets for the same period. The Compensation Committee will determine the achievement of performance results and corresponding vesting of performance shares for each year’s grant in 2017, 2018 and 2019 following the conclusion of the respective performance period. At the end of each performance period, the number of shares awarded can range from 0% to 200% of the original granted amount for performance share units granted in 2019, 2018 and 2017. The following table summarizes the activity of performance share units granted at target as of December 31, 2019. Weighted-Average Grant-Date Number of PSUs Fair Value Non-vested PSUs outstanding at December 31, 2016 363,993 $ 14.23 Granted 119,315 35.81 Vested — — Cancelled (14,732) 15.00 Non-vested PSUs outstanding at December 31, 2017 468,576 $ 19.70 Granted 90,264 53.41 Additional PSUs awarded from the 2015 grant 92,335 13.62 Vested (277,029) 13.62 Cancelled (3,229) 30.09 Non-vested PSUs outstanding at December 31, 2018 370,917 $ 30.84 Granted 87,864 48.81 Additional PSUs awarded from the 2016 grant 67,853 14.80 Vested (203,582) 14.80 Cancelled (89,481) 34.70 Non-vested PSUs outstanding at December 31, 2019 233,571 $ 45.44 During the years ended December 31, 2019, 2018 and 2017 the Company granted fully-vested shares of common stock to the Company’s directors in the amounts of 18,576, 15,165 and 22,617 shares, respectively, with a weighted average grant-date fair value of $48.45, $53.40, and $35.81 respectively. During the year ended December 31, 2019, 2018 and 2017, the Company recorded equity-based compensation expense of $10.3 million, $13.1 million and $10.6 million, respectively. Additionally, the Company incurred $7.9 million of employee severance related costs associated with the sale of ExpressJet, partially offset by a forfeiture credit of $4.5 million, primarily resulting from stock-based compensation awards that terminated upon the sale of ExpressJet during 2019. As of December 31, 2019, the Company had $10.0 million of total unrecognized compensation cost related to non-vested restricted stock grants and non-vested performance stock units. Total unrecognized compensation cost will be adjusted for future changes in estimated forfeitures. The Company expects to recognize this cost over a weighted average period of 1.7 years. Taxes The Company’s treatment of stock option grants of non-qualified options, restricted stock units and performance shares results in the creation of a deferred tax asset, which is a temporary difference, until the time that the option is exercised or the restrictions lapse. |
Retirement Plans and Employee S
Retirement Plans and Employee Stock Purchase Plans | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Plans and Employee Stock Purchase Plans | |
Retirement Plans and Employee Stock Purchase Plans | (10) Retirement Plans and Employee Stock Purchase Plans SkyWest Retirement Plan The Company sponsors the SkyWest, Inc. Employees’ Retirement Plan (the “SkyWest Plan”). Employees who have completed 90 days of service and are at least 18 years of age are eligible for participation in the SkyWest Plan. Employees may elect to make contributions to the SkyWest Plan. Generally, the Company matches 100% of such contributions up to levels ranging from 2% to 12 % of compensation, based on position and years of service. Additionally, a discretionary contribution may be made by the Company. The Company’s combined contributions to the SkyWest Plan were $40.7 million, $35.6 million and $26.1 million for the years ended December 31, 2019, 2018 and 2017, respectively. Employee Stock Purchase Plans In May 2009, the Company’s Board of Directors approved the SkyWest, Inc. 2009 Employee Stock Purchase Plan (the “2009 Stock Purchase Plan”). All employees who have completed 90 days of employment with the Company or one of its subsidiaries are eligible to participate in the 2009 Stock Purchase Plan, except employees who own five percent or more of the Company’s common stock. The 2009 Stock Purchase Plan enables employees to purchase shares of the Company’s common stock at a five percent discount, through payroll deductions. Employees can contribute up to 15% of their base pay, not to exceed $25,000 each calendar year, for the purchase of shares. Shares are purchased semi-annually at a five percent discount based on the end of the period price. Employees can terminate their participation in the 2009 Stock Purchase Plan at any time upon written notice. The following table summarizes purchases made under the 2009 Employee Stock Purchase Plans during the years ended December 31, 2019, 2018 and 2017: Year ended December 31, 2019 2018 2017 Number of shares purchased 65,148 60,950 88,362 Average price of shares purchased $ 48.58 $ 49.85 $ 33.96 The 2009 Stock Purchase Plan is a non-compensatory plan under the accounting guidance. Therefore, no compensation expense was recorded for the years ended December 31, 2019, 2018 and 2017. |
Stock Repurchase
Stock Repurchase | 12 Months Ended |
Dec. 31, 2019 | |
Stock Repurchase | |
Stock Repurchase | (11) Stock Repurchase The Company’s Board of Directors has adopted a stock repurchase program which authorizes the Company to repurchase shares of the Company’s common stock in the public market or in private transactions, from time to time, at prevailing prices. The Company’s stock repurchase program authorizes the repurchase of up to $250.0 million of the Company’s common stock commencing on February 5, 2019, of which $159.6 million remained available at December 31, 2019. During the years ended December 31, 2019, 2018 and 2017, the Company repurchased 1.7 million, 1.0 million and 0.5 million shares of common stock (including shares purchased from the Company’s Chairman of the Board see Note 12 Related-Party Transactions for more details) for approximately $94.6 million, $54.4 million and $20.0 million, respectively at a weighted average price per share of $56.86, $56.25 and $41.36, respectively. Additionally, during the year ended December 31, 2019, 2018 and 2017, the Company paid |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions | |
Related Party Transactions | (12) Related-Party Transactions On June 13, 2019, the Company repurchased 268,025 shares of its common stock from Jerry Atkin, Chairman of the Board, at a price of $60.24 per share, representing the volume-weighted average price of the Company’s common stock over the five trading days immediately prior to such repurchase. The transaction was part of Mr. Atkin’s personal long-term strategy for asset diversification, tax and estate planning and to fund philanthropic and charitable efforts. The transaction was approved by the Company’s Audit Committee and was effected pursuant to the Company’s stock repurchase plan that commenced on February 5, 2019. During the year ended December 31, 2019, the Company purchased $93,540 of spare aircraft parts from an entity affiliated with a director of the Company. |
Gain on Sale of ExpressJet
Gain on Sale of ExpressJet | 12 Months Ended |
Dec. 31, 2019 | |
Gain on Sale of ExpressJet | |
Gain on Sale of ExpressJet | (13) Gain on Sale of ExpressJet On January 22, 2019, the Company completed the sale of its former wholly owned subsidiary ExpressJet. The Company recorded a gain of $46.5 million (pre-tax) from the sale of ExpressJet. The closing of the transaction was completed in two parts, through an asset sale and stock sale, as further described below. Asset Sale On January 11, 2019, pursuant to the terms and conditions of the Asset Purchase Agreement, dated as of December 17, 2018, by and among the Company, ExpressJet and United, United acquired certain specified assets and liabilities of ExpressJet, including, among other things, aircraft engines, auxiliary power units, rotable spare parts, ground support equipment and flight training equipment for $60.8 million in cash, subject to certain purchase price adjustments (the “Asset Sale”). Certain assets and liabilities of ExpressJet were expressly excluded from the Asset Sale. Stock Sale Additionally, on January 22, 2019, pursuant to the terms and conditions of the Stock Purchase Agreement, dated as of December 17, 2018, by and among the Company and ManaAir, LLC, a company in which United owns a minority interest (the “Buyer”), the Buyer acquired all of the outstanding shares of capital stock of ExpressJet from the Company for $18.8 million in cash, subject to certain purchase price adjustments (the “Stock Sale,”). To facilitate payment of the purchase price for the Stock Sale, at the closing of the Stock Sale, the Company loaned $26 million to Kair Enterprises, Inc. (the “Borrower”), the majority owner of the Buyer. Such loan accrues interest at the rate of 6.85% per annum, matures on the last business day of the last month immediately preceding the two-year anniversary of the closing of the Stock Sale and is secured by, among other things, the Borrower’s ownership interests in the Buyer. The Company also leased 16 CRJ200 aircraft to ExpressJet for a portion of the 2019 year. The lease of these 16 CRJ200 aircraft was terminated as of December 31, 2019. |
Investment in Other Companies
Investment in Other Companies | 12 Months Ended |
Dec. 31, 2019 | |
Investment in Other Companies | |
Investment in Other Companies | (14) Investment in Other Companies During 2019, the Company created a joint venture with Regional One, Inc. (“Regional One”) by investing $22.3 million for a 75% ownership interest in Aero Engines, LLC. (“Aero Engines”). The primary purpose of Aero Engines is to lease engines to third parties. Aero Engines requires unanimous approval from the Company and Regional One for its engine purchases, dispositions, lease agreements with third parties and all other material transactions. The Company determined Aero Engines is a variable interest entity as the Company has a 75% ownership interest in Aero Engines and all material decisions require unanimous approval from the Company and Regional One, resulting in disproportionate ownership rights relative to voting rights. As unanimous approval is required for all Aero Engines’ material activities. Aero Engines has no primary beneficiary. The Company accounts for its investment in Aero Engines under the equity method. The Company’s exposure in its investment in Aero Engines primarily consists of the Company’s portion of income or loss from Aero Engines’ engine lease agreements with third parties and the Company’s ownership percentage in Aero Engines’ engines book value. The Company purchased |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Data (Unaudited) | |
Quarterly Financial Data (Unaudited) | (15) Quarterly Financial Data (Unaudited) Unaudited summarized financial data by quarter for 2019 and 2018 is as follows (in thousands, except per share data): Year ended December 31, 2019 First Second Third Fourth Quarter Quarter Quarter Quarter Year Operating revenues $ 723,694 $ 744,383 $ 760,295 $ 743,591 $ 2,971,963 Operating income 96,419 144,093 146,441 125,305 512,258 Net income (1) 88,181 88,052 91,339 72,527 340,099 Net income per common share: Basic 1.71 1.72 1.80 1.44 6.68 Diluted 1.69 1.71 1.79 1.43 6.62 Weighted average common shares: Basic: 51,440 51,145 50,746 50,395 50,932 Diluted: 52,098 51,477 51,129 50,796 51,375 (1) Net income for the first quarter of 2019 included a $46.5 million gain related to the sale of ExpressJet (see Note 13 Gain on Sale of ExpressJet for more details) and a $21.9 million special charge (see Note 8 Special Items for more details). Year ended December 31, 2018 First Second Third Fourth Quarter Quarter Quarter Quarter Year Operating revenues $ 783,400 $ 805,515 $ 829,275 $ 803,489 $ 3,221,679 Operating income 88,175 126,678 137,925 121,502 474,280 Net income 54,362 75,859 83,046 67,105 280,372 Net income per common share: Basic 1.05 1.46 1.60 1.30 5.40 Diluted 1.03 1.43 1.57 1.28 5.30 Weighted average common shares: Basic: 51,921 52,046 52,039 51,650 51,914 Diluted: 53,033 52,913 52,981 52,556 52,871 |
SCHEDULE II-VALUATION AND QUALI
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2019 | |
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS | |
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS | SKYWEST, INC. AND SUBSIDIARIES SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS For the Years Ended December 31, 2019, 2018 and 2017 (Dollars in thousands) Additions Balance at Charged to Beginning Costs and Balance at Description of Year Expenses Deductions End of Year Year ended December 31, 2019: Allowance for inventory obsolescence $ 22,141 — (6,251) $ 15,890 Allowance for doubtful accounts receivable 158 — (140) 18 $ 22,299 — (6,391) $ 15,908 Year ended December 31, 2018: Allowance for inventory obsolescence $ 17,098 5,043 — $ 22,141 Allowance for doubtful accounts receivable 157 1 — 158 $ 17,255 5,044 — $ 22,299 Year ended December 31, 2017: Allowance for inventory obsolescence(1) $ 40,497 — (23,399) $ 17,098 Allowance for doubtful accounts receivable 173 — (16) 157 $ 40,670 — (23,415) $ 17,255 (1) The deductions in 2017 related to the disposal of excess and obsolete inventory in 2017. |
Nature of Operations and Summ_2
Nature of Operations and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Nature of Operations and Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The Company’s consolidated financial statements include the accounts of the Company and the SkyWest Airlines, ExpressJet (for the periods owned by the Company) and SkyWest Leasing segments, with all inter-company transactions and balances having been eliminated. In preparing the accompanying consolidated financial statements, the Company has reviewed, as determined necessary by the Company’s management, events that have occurred after December 31, 2019, through the filing date of the Company’s annual report with the U.S. Securities and Exchange Commission. The Company reclassified certain prior period amounts to conform to the current period presentation (see Recent Accounting Pronouncements). |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. The Company had no restricted cash as of December 31, 2019 and 2018. |
Marketable securities | Marketable Securities The Company’s investments in debt securities are classified as available-for-sale and are reported at fair market value with the net unrealized appreciation reported as a component of accumulated other comprehensive income (loss) in stockholders’ equity. At the time of sale, any realized appreciation or depreciation, calculated by the specific identification method, is recognized in other income and expense. At December 31, 2019, the fair market value of the available-for-sale securities was the amortized cost. The Company’s position in marketable securities as of December 31, 2019 and 2018 was as follows (in thousands): Gross unrealized Gross unrealized At December 31, 2019 Amortized Cost holding gains holding losses Fair market value Total cash and cash equivalents $ 87,206 $ — $ — $ 87,206 Marketable securities: Bond and bond funds $ 267,243 $ — $ — $ 267,243 Commercial Paper 165,723 — — 165,723 Total marketable securities $ 432,966 $ — $ — $ 432,966 Total assets measured at fair value $ 520,172 $ — $ — $ 520,172 Gross unrealized Gross unrealized At December 31, 2018 Amortized Cost holding gains holding losses Fair market value Total cash and cash equivalents $ 328,384 $ — $ — $ 328,384 Marketable securities: Bond and bond funds $ 229,825 $ — $ (42) $ 229,783 Commercial Paper 131,163 — (1) 131,162 Total marketable securities $ 360,988 $ — $ (43) $ 360,945 Total assets measured at fair value $ 689,372 $ — $ (43) $ 689,329 |
Inventories | Inventories Inventories include expendable parts, fuel and supplies and are valued at cost (FIFO basis) less an allowance for obsolescence based on historical results, excess parts and management’s expectations of future operations. Expendable inventory parts are charged to expense as used. An obsolescence allowance for flight equipment expendable parts is accrued based on estimated lives of the corresponding fleet types and salvage values. The inventory allowance as of December 31, 2019 and 2018 was $15.9 million and $22.1 million, respectively. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost and depreciated over their useful lives to their estimated residual values using the straight-line method as follows: Assets Depreciable Life Current Residual Value Aircraft, rotable spares, and spare engines up to 22 years up to 20 % Ground equipment up to 10 years 0 % Office equipment up to 7 years 0 % Leasehold improvements Shorter of 15 years or lease term 0 % Buildings 20 - 39.5 years 0 % |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets As of December 31, 2019, the Company had approximately $5.4 billion of property and equipment and related assets. In accounting for these long-lived and intangible assets, the Company makes estimates about the expected useful lives of the assets, the expected residual values of certain of these assets, and the potential for impairment based on the fair value of the assets and the cash flows they generate. Factors indicating potential impairment include, but are not limited to, significant decreases in the market value of the long-lived assets, a significant change in the condition of the long-lived assets and operating cash flow losses associated with the use of the long-lived assets. On a periodic basis, the Company evaluates whether impairment indicators are present. When considering whether or not impairment of long- lived assets exists, the Company groups similar assets together at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities and compare the undiscounted cash flows for each asset group to the net carrying amount of the assets supporting the asset group. Asset groupings are done at the fleet or contract level. The Company did not recognize any impairment charges of long-lived assets during the years ended December 31, 2019, 2018 and 2017. |
Capitalized Interest | Capitalized Interest Interest is capitalized on aircraft purchase deposits as a portion of the cost of the asset and is depreciated over the estimated useful life of the asset. During the years ended December 31, 2019, 2018 and 2017, the Company capitalized interest costs of approximately $1.6 million, $1.5 million, and $1.4 million, respectively. |
Maintenance | Maintenance The Company operates under a U.S. Federal Aviation Administration approved continuous inspection and maintenance program. The Company uses the direct expense method of accounting for its regional jet engine overhauls wherein the expense is recorded when the overhaul event occurs. The Company has engine services agreements with third-party vendors to provide long-term engine services covering the scheduled and unscheduled repairs for most of its aircraft. Under the terms of the agreements, the Company pays a fixed dollar amount per engine hour flown on a monthly basis and the third-party vendors will assume the responsibility to repair the engines at no additional cost to the Company, subject to certain specified exclusions. Maintenance costs under these contracts are recognized when the engine hour is flown pursuant to the terms of each contract. The costs of maintenance for airframe and avionics components, landing gear and other recurring maintenance are expensed as incurred. |
Flying Agreements and Airport Customer Service and Other Revenues | Flying Agreements and Airport Customer Service and Other Revenues The Company recognizes flying agreements revenue and airport customer service and other revenues when the service is provided under its code-share agreements. Under the Company’s fixed-fee arrangements (referred to as “fixed-fee arrangements,” “fixed-fee contracts” or “capacity purchase agreements”) with Delta Air Lines, Inc. (“Delta”), United Airlines, Inc. (“United”), American Airlines, Inc. (“American”) and Alaska Airlines, Inc. (“Alaska”) (each, a “major airline partner”), the major airline partner generally pays the Company a fixed-fee for each departure, flight hour (measured from takeoff to landing, excluding taxi time) or block hour (measured from takeoff to landing, including taxi time) incurred, and an amount per aircraft in service each month with additional incentives based on flight completion and on-time performance. The major airline partner also directly pays for or reimburses the Company for certain direct expenses incurred under the fixed-fee arrangement, such as fuel, airport landing fees and airport rents. Under the fixed-fee arrangements, the Company’s performance obligation is met and revenue is recognized when each flight is completed and is reflected in flying agreements revenue. The transaction price for the fixed-fee agreements is determined from the fixed-fee consideration, incentive consideration and directly reimbursed expenses earned as flights are completed over the agreement term. For the year ended December 31, 2019, fixed-fee arrangements represented approximately Under the Company’s revenue-sharing arrangements (referred to as a “revenue-sharing” or “prorate” arrangement), the major airline partner and the Company negotiate a passenger fare proration formula, pursuant to which the Company receives a percentage of the ticket revenues for those passengers traveling for one portion of their trip on a Company airline and the other portion of their trip on the major airline partner. Under the Company’s prorate flying agreements, the performance obligation is met and revenue is recognized when each flight is completed based upon the portion of the prorate passenger fare the Company anticipates that it will receive for each completed flight. The transaction price for the prorate agreements is determined from the proration formula derived from each passenger ticket amount on each completed flight over the agreement term. For the year ended December 31, 2019, prorate flying arrangements represented approximately Airport customer service and other revenues primarily consist of ground handling functions, such as gate and ramp agent services at applicable airports where the Company provides such services. The transaction price for airport customer service agreements is determined from an agreed-upon rate by location applied to the applicable number of flights handled by the Company over the agreement term. Additionally, airport customer service and other revenues includes revenue generated from aircraft and spare engines leased to third parties. Of the Company’s $5.4 billion of property and equipment, net as of December 31, 2019, $97.0 million of regional jet aircraft and spare engines was leased to third parties under operating leases. The Company mitigates the residual asset risks of these assets by leasing aircraft and engine types that can be operated by the Company in the event of a default. A portion of the Company’s leases to third parties contain variable payments from lessees based on departures where the Company pays for maintenance. Additionally, the operating leases typically have specified lease return condition requirements paid by the lessee to the Company and the Company typically maintains inspection rights under the leases. The following table represents the Company’s airport customer service and other revenue for the years ended December 31, 2019, 2018 and 2017 (in thousands): For the year ended December 31, 2019 2018 2017 Airport customer service revenue $ 45,538 $ 48,236 $ 41,002 Operating lease income relating to lease payments 27,552 3,923 3,293 Operating lease income relating to variable lease payments 9,608 — — Airport customer service and other $ 82,698 $ 52,159 $ 44,295 The following table summarizes future minimum rental income under operating leases primarily related to leased aircraft that had remaining non-cancelable lease terms as of December 31, 2019 (in thousands): 2020 $ 32,724 2021 31,344 2022 24,786 2023 18,530 2024 18,222 Thereafter 54,932 $ 180,538 Other ancillary revenues commonly associated with airlines, such as baggage fee revenue, ticket change fee revenue and the marketing component of the sale of mileage credits, are retained by the Company’s major airline partners on flights that the Company operates under its code-share agreements. The following table represents the Company’s flying agreements revenue by type for the years ended December 31, 2019, 2018 and 2017 (in thousands): For the year ended December 31, 2019 2018 2017 Capacity purchase agreements revenue: flight operations $ 1,538,062 $ 1,856,253 $ 1,805,510 Capacity purchase agreements revenue: aircraft lease 830,247 814,518 834,366 Prorate agreements revenue 520,956 498,749 438,421 Flying agreements revenue $ 2,889,265 $ 3,169,520 $ 3,078,297 A portion of the Company’s compensation under its fixed-fee agreements is designed to reimburse the Company for certain aircraft ownership costs. The consideration for aircraft ownership costs varies by agreement but is intended to cover either the Company’s aircraft principal and interest debt service costs, its aircraft depreciation and interest expense or its aircraft lease expense costs while the aircraft is under contract. The consideration received for the use of the aircraft under the Company’s fixed-fee agreements is reflected as lease revenue, inasmuch as the agreements identify the “right of use” of a specific type and number of aircraft over a stated period of time. The lease revenue associated with the Company’s fixed-fee agreements is accounted for as an operating lease and is reflected as flying agreements revenue on the Company’s consolidated statements of comprehensive income. The Company has not separately stated aircraft rental income and aircraft rental expense in the consolidated statement of comprehensive income since the use of the aircraft is not a separate activity of the total service provided. The Company’s fixed-fee and prorate agreements include weekly provisional cash payments from the respective major airline partner based on a projected level of flying each month. The Company and each major airline partner subsequently reconcile these payments to the actual completed flight activity on a monthly or quarterly basis. In the event a flying agreement includes a mid-term rate reset to adjust rates prospectively and the contractual rates under the Company’s flying agreements have not been finalized at quarterly or annual financial statement dates, the Company applies the variable constraint guidance under Topic 606, where the Company records revenue to the extent it believes that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. In several of the Company’s agreements, the Company is eligible to receive incentive compensation upon the achievement of certain performance criteria. The incentives are defined in the agreements and are measured and determined on a monthly, quarterly or semi-annual basis. At the end of each period during the term of an agreement, the Company calculates the incentives achieved during that period and recognizes revenue attributable to that agreement accordingly, subject to the variable constraint guidance under Topic 606. The following summarizes the significant provisions of each code-share agreement the Company has with each major airline partner through SkyWest Airlines: Delta Connection Agreements Agreement Aircraft type Number of Aircraft Term / Termination Dates Delta Connection Agreement (fixed-fee arrangement) ● CRJ 200 ● CRJ 700 ● CRJ 900 ● E175 55 13 43 59 ● Individual aircraft have scheduled removal dates from 2020 to 2029 ● Delta Connection Prorate Agreement (revenue-sharing arrangement) ● CRJ 200 29 ● Terminable with 30-day United Express Agreements Agreement Aircraft type Number of Aircraft Term / Termination Dates United Express Agreements (fixed-fee arrangement) ● CRJ 200 ● CRJ 700 ● E175 68 19 65 ● Individual aircraft have scheduled removal dates under the agreement between 2020 and 2029 ● United Express Prorate Agreement (revenue-sharing arrangement) ● CRJ 200 31 ● Terminable with 120-day American Agreements Agreement Aircraft type Number of Aircraft Term / Termination Dates American Agreement (fixed-fee arrangement) ● CRJ 700 62 ● ● American Prorate Agreement (revenue-sharing arrangement) ● 7 ● 120-day Alaska Capacity Purchase Agreement Agreement Aircraft type Number of Aircraft Term / Termination Dates Alaska Agreement (fixed-fee arrangement) ● E175 32 ● ● In addition to the contractual arrangements described above, SkyWest Airlines has entered into fixed-fee agreements with Delta and American to place additional E175 aircraft into service. As of December 31, 2019, the Company was scheduled to take delivery of new E175 aircraft in connection with its agreement with American. The delivery dates for the new E175 aircraft are currently scheduled to be completed by the end of 2021. Final delivery dates may be adjusted based on various factors. Additionally, the Company is scheduled to add an additional six used E175 aircraft under the Delta agreement during 2020. SkyWest Airlines also entered into an agreement with Delta to place one CRJ900 aircraft under a nine-year fixed-fee agreement in 2020. SkyWest Airlines also entered into an agreement with American to place ten used CRJ700s under a multi-year contract. As of December 31, 2019, SkyWest Airlines had placed two of these CRJ700 aircraft into service with American. When an aircraft is scheduled to be removed from a fixed-fee arrangement, the Company may, as practical under the circumstances, negotiate an extension with the respective major airline partner, negotiate the placement of the aircraft with another major airline partner, return the aircraft to the lessor if the aircraft is leased and the lease is expiring, place owned aircraft for sale, or pursue other uses for the aircraft. Other uses for the aircraft may include placing the aircraft in a prorate arrangement, leasing the aircraft to a third party or parting out the aircraft to use the engines and parts as spare inventory or to lease the engines to a third party. Airport customer service and other revenues primarily consist of ground handling functions, such as gate and ramp agent services at applicable airports where the Company provides such services. The transaction price for airport service agreements is determined from an agreed-upon rate by location applied to the applicable number of flights handled (measured by departures) by the Company over the agreement term. The Company’s operating revenues could be impacted by a number of factors, including changes to the Company’s code-share agreements with its major airline partners, changes in flight schedules, contract modifications resulting from contract renegotiations, the Company’s ability to earn incentive payments contemplated under the Company’s code-share agreements and settlement of reimbursement disputes with the Company’s major airline partners. As of December 31, 2019, the Company had $83.0 million in accounts receivable of which $58.8 million related to flying agreements. As of December 31, 2018, the Company had $64.2 million in accounts receivable of which $52.7 million related to flying agreements. |
Income Taxes | Income Taxes The Company recognizes a net liability or asset for the deferred tax consequences of all temporary differences between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements that are expected to result in taxable or deductible amounts in future years when the reported amounts of the assets and liabilities are recovered or settled. |
Net Income Per Common Share | Net Income Per Common Share Basic net income per common share (“Basic EPS”) excludes dilution and is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted net income per common share (“Diluted EPS”) reflects the potential dilution that could occur if stock options or other contracts to issue common stock were exercised or converted into common stock. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an anti-dilutive effect on net income (loss) per common share. During the year ended December 31, 2019, 150,000 performance share units (at target performance) were excluded in the computation of Diluted EPS since the Company had not achieved the minimum target thresholds as of December 31, 2019. During the year ended December 31, 2018, 207,000 performance share units (at target performance) were excluded in the computation of Diluted EPS since the Company had not achieved the minimum target thresholds as of December 31, 2018. During the year ended December 31, 2017, 284,000 performance share units (at target performance) were excluded in the computation of Diluted EPS since the Company had not achieved the minimum target thresholds as of December 31, 2017. The calculation of the weighted average number of common shares outstanding for Basic EPS and Diluted EPS are as follows for the years ended December 31, 2019, 2018 and 2017 (in thousands): Year Ended December 31, 2019 2018 2017 Numerator: Net Income $ 340,099 $ 280,372 $ 428,907 Denominator: Basic earnings per share weighted average shares 50,932 51,914 51,804 Dilution due to stock options and restricted stock units 443 957 1,296 Diluted earnings per share weighted average shares 51,375 52,871 53,100 Basic earnings per share $ 6.68 $ 5.40 $ 8.28 Diluted earnings per share $ 6.62 $ 5.30 $ 8.08 |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Comprehensive income (loss) includes charges and credits to stockholders’ equity that are not the result of transactions with the Company’s shareholders, including changes in unrealized appreciation on marketable debt securities. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts reported in the consolidated balance sheets for receivables and accounts payable approximate fair values because of the immediate or short-term maturity of these financial instruments. Marketable securities are reported at fair value based on market quoted prices in the consolidated balance sheets. If quoted prices in active markets are no longer available, the Company has estimated the fair values of these securities utilizing a discounted cash flow analysis. These analyses consider, among other items, the collateralization underlying the security investments, the creditworthiness of the counterparty, the timing of expected future cash flows, and the expectation of the next time the security is expected to have a successful auction. The fair value of the Company’s long-term debt is estimated based on current rates offered to the Company for similar debt and was approximately $3,049.1 million as of December 31, 2019, as compared to the carrying amount of $3,017.5 million as of December 31, 2019. The Company’s fair value of long-term debt as of December 31, 2018 was $3,157.3 million as compared to the carrying amount of $3,185.4 million as of December 31, 2018. |
Segment Reporting | Segment Reporting Generally accepted accounting principles require disclosures related to components of a company for which separate financial information is available to, and regularly evaluated by, the Company’s chief operating decision maker when deciding how to allocate resources and in assessing performance. The Company’s three operating segments (prior to the sale of ExpressJet in January 2019) consist of the operations conducted by SkyWest Airlines, ExpressJet (for the periods owned by the Company) and SkyWest Leasing. Following the sale of ExpressJet, the Company has two reportable segments: SkyWest Airlines and SkyWest Leasing. Information pertaining to the Company’s reportable segments is presented in Note 2, Segment Reporting |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Standards Effective in Future Years and Not Yet Adopted In June 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments” (“Topic 326”), which requires measurement and recognition of expected credit losses for financial assets held and requires enhanced disclosure regarding significant estimates and judgments used in estimating credit losses. Topic 326 is effective for the Company beginning January 1, 2020. The Company will adopt Topic 326, on January 1, 2020. The Company’s primary financial assets as of December 31, 2019, include trade receivables from its flying agreements, notes and other receivables from third parties. The Company estimates it will record a credit loss amount between Recently Adopted Standards In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842)” (“Topic 842”). Topic 842 and subsequently issued amendments require certain leases with durations longer than 12 months to be recognized on the balance sheet. The Company adopted Topic 842 effective January 1, 2019 and elected the package of transition practical expedients for expired or existing contracts, which does not require reassessment of: (1) whether any of the Company’s contracts are or contain leases, (2) lease classification and (3) initial direct costs. In July 2018, the FASB issued ASU No. 2018-11, “Targeted Improvements - Leases (Topic 842).” This update provides an optional transition method that allows entities to elect to apply the standard using the modified retrospective approach at its effective date, versus recasting the prior years presented. If this adoption method is elected, an entity would recognize a cumulative-effect adjustment to the opening balance of retained earnings in the year of adoption. The Company elected this adoption method and recognized a cumulative-effect adjustment to the opening balance of retained earnings on January 1, 2019. Additionally, the Company’s adoption of Topic 842 did not have a significant impact on the recognition, measurement or presentation of lease revenue and lease expenses within the condensed consolidated statements of operations and comprehensive income or the condensed consolidated statements of cash flows. The Company’s adoption of Topic 842 did not have a material impact on the timing or amount of the Company’s lease revenue as a lessor. The Company’s prepaid aircraft rents, accrued aircraft rents and deferred rent credits that were separately stated in the Company’s December 31, 2018 balance sheet have been classified as a component of the Company’s right-of-use assets effective January 1, 2019. The consolidated financial statements for 2019 are presented under the new standard, while comparative years presented are not adjusted and continue to be reported in accordance with the Company’s historical accounting policy. See Note 6, " Leases |
Nature of Operations and Summ_3
Nature of Operations and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Schedule of number of aircraft held by entity | CRJ200 CRJ700 CRJ900 E175 Total Delta 84 13 43 59 199 United 99 19 — 65 183 American 7 62 — — 69 Alaska — — — 32 32 Aircraft in scheduled service 190 94 43 156 483 Subleased to an un-affiliated entity 4 10 5 — 19 Other* 20 22 — — 42 Total Fleet 214 126 48 156 544 *As of December 31, 2019, these aircraft have been removed from service and are in the process of being placed under a leasing arrangement with a third party, are aircraft transitioning between code-share agreements with the Company’s major airline partners and being used as a supplemental spare aircraft, or are in the process of being parted out. |
Schedule of marketable securities | At December 31, 2019, the fair market value of the available-for-sale securities was the amortized cost. The Company’s position in marketable securities as of December 31, 2019 and 2018 was as follows (in thousands): Gross unrealized Gross unrealized At December 31, 2019 Amortized Cost holding gains holding losses Fair market value Total cash and cash equivalents $ 87,206 $ — $ — $ 87,206 Marketable securities: Bond and bond funds $ 267,243 $ — $ — $ 267,243 Commercial Paper 165,723 — — 165,723 Total marketable securities $ 432,966 $ — $ — $ 432,966 Total assets measured at fair value $ 520,172 $ — $ — $ 520,172 Gross unrealized Gross unrealized At December 31, 2018 Amortized Cost holding gains holding losses Fair market value Total cash and cash equivalents $ 328,384 $ — $ — $ 328,384 Marketable securities: Bond and bond funds $ 229,825 $ — $ (42) $ 229,783 Commercial Paper 131,163 — (1) 131,162 Total marketable securities $ 360,988 $ — $ (43) $ 360,945 Total assets measured at fair value $ 689,372 $ — $ (43) $ 689,329 |
Schedule of property and equipment | Assets Depreciable Life Current Residual Value Aircraft, rotable spares, and spare engines up to 22 years up to 20 % Ground equipment up to 10 years 0 % Office equipment up to 7 years 0 % Leasehold improvements Shorter of 15 years or lease term 0 % Buildings 20 - 39.5 years 0 % |
Schedule of future minimum rental payments for operating leases | 2020 $ 94,806 2021 84,285 2022 73,960 2023 68,581 2024 27,282 Thereafter 94,746 $ 443,660 |
Schedule of net income (loss) per common share | Year Ended December 31, 2019 2018 2017 Numerator: Net Income $ 340,099 $ 280,372 $ 428,907 Denominator: Basic earnings per share weighted average shares 50,932 51,914 51,804 Dilution due to stock options and restricted stock units 443 957 1,296 Diluted earnings per share weighted average shares 51,375 52,871 53,100 Basic earnings per share $ 6.68 $ 5.40 $ 8.28 Diluted earnings per share $ 6.62 $ 5.30 $ 8.08 |
Flying agreements | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Schedule of revenue | The following table represents the Company’s flying agreements revenue by type for the years ended December 31, 2019, 2018 and 2017 (in thousands): For the year ended December 31, 2019 2018 2017 Capacity purchase agreements revenue: flight operations $ 1,538,062 $ 1,856,253 $ 1,805,510 Capacity purchase agreements revenue: aircraft lease 830,247 814,518 834,366 Prorate agreements revenue 520,956 498,749 438,421 Flying agreements revenue $ 2,889,265 $ 3,169,520 $ 3,078,297 |
Airport customer service and other | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Schedule of revenue | The following table represents the Company’s airport customer service and other revenue for the years ended December 31, 2019, 2018 and 2017 (in thousands): For the year ended December 31, 2019 2018 2017 Airport customer service revenue $ 45,538 $ 48,236 $ 41,002 Operating lease income relating to lease payments 27,552 3,923 3,293 Operating lease income relating to variable lease payments 9,608 — — Airport customer service and other $ 82,698 $ 52,159 $ 44,295 |
Delta Connection Agreement | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Schedule of details of aircraft and agreements with other airlines | Delta Connection Agreements Agreement Aircraft type Number of Aircraft Term / Termination Dates Delta Connection Agreement (fixed-fee arrangement) ● CRJ 200 ● CRJ 700 ● CRJ 900 ● E175 55 13 43 59 ● Individual aircraft have scheduled removal dates from 2020 to 2029 ● Delta Connection Prorate Agreement (revenue-sharing arrangement) ● CRJ 200 29 ● Terminable with 30-day |
United Express Agreements | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Schedule of details of aircraft and agreements with other airlines | United Express Agreements Agreement Aircraft type Number of Aircraft Term / Termination Dates United Express Agreements (fixed-fee arrangement) ● CRJ 200 ● CRJ 700 ● E175 68 19 65 ● Individual aircraft have scheduled removal dates under the agreement between 2020 and 2029 ● United Express Prorate Agreement (revenue-sharing arrangement) ● CRJ 200 31 ● Terminable with 120-day |
American Agreements | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Schedule of details of aircraft and agreements with other airlines | American Agreements Agreement Aircraft type Number of Aircraft Term / Termination Dates American Agreement (fixed-fee arrangement) ● CRJ 700 62 ● ● American Prorate Agreement (revenue-sharing arrangement) ● 7 ● 120-day |
Alaska Capacity Purchase Agreement | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Schedule of details of aircraft and agreements with other airlines | Alaska Capacity Purchase Agreement Agreement Aircraft type Number of Aircraft Term / Termination Dates Alaska Agreement (fixed-fee arrangement) ● E175 32 ● ● |
Aircraft | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Schedule of future minimum rental payments for operating leases | The following table summarizes future minimum rental income under operating leases primarily related to leased aircraft that had remaining non-cancelable lease terms as of December 31, 2019 (in thousands): 2020 $ 32,724 2021 31,344 2022 24,786 2023 18,530 2024 18,222 Thereafter 54,932 $ 180,538 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting | |
Schedule of Company's segment data | The following represents the Company’s segment data for the years ended December 31, 2019, 2018 and 2017 (in thousands). Year Ended December 31, 2019 SkyWest Airlines ExpressJet SkyWest Leasing Consolidated Operating revenues $ 2,478,681 $ 24,050 $ 469,232 $ 2,971,963 Operating expense 2,214,632 28,690 216,383 2,459,705 Depreciation and amortization expense 168,246 971 198,881 368,098 Special items 18,508 3,361 — 21,869 Interest expense 13,525 — 114,230 127,755 Segment profit (loss) (1) 250,524 (4,640) 138,619 384,503 Total assets 2,728,964 — 3,928,165 6,657,129 Capital expenditures (including non-cash) 270,191 — 576,279 846,470 Year Ended December 31, 2018 SkyWest Airlines ExpressJet SkyWest Leasing Consolidated Operating revenues $ 2,346,251 $ 564,202 $ 311,226 $ 3,221,679 Operating expense 2,022,560 577,608 147,231 2,747,399 Depreciation and amortization expense 155,511 37,290 141,788 334,589 Interest expense 17,021 2,340 101,048 120,409 Segment profit (loss) (1) 306,670 (15,746) 62,947 353,871 Total assets 2,531,707 279,303 3,502,202 6,313,212 Capital expenditures (including non-cash) 149,731 10,137 996,408 1,156,276 Year Ended December 31, 2017 SkyWest Airlines ExpressJet SkyWest Leasing Consolidated Operating revenues $ 2,092,368 $ 790,282 $ 239,942 $ 3,122,592 Operating expense 1,807,540 818,683 108,170 2,734,393 Depreciation and amortization expense 134,563 51,982 106,223 292,768 Interest expense 21,544 4,127 79,254 104,925 Segment profit (loss) (1) 263,284 (32,528) 52,518 283,274 Identifiable intangible assets, other than goodwill — 4,896 — 4,896 Total assets 2,245,051 599,122 2,630,227 5,474,400 Capital expenditures (including non-cash) 124,955 14,278 550,165 689,398 (1) Segment profit is operating income less interest expense |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Long-Term Debt | |
Schedule of long-term debt | Long-term debt consisted of the following as of December 31, 2019 and 2018 (in thousands): December 31, December 31, 2019 2018 Notes payable to banks, due in semi-annual installments, variable interest based on LIBOR, or with an interest rate of 4.00% through 2019, secured by aircraft $ — $ 6,429 Notes payable to a financing company, due in semi-annual installments, with a fixed interest rate of 3.25% through 2021, secured by aircraft 18,412 36,324 Notes payable to banks, due in semi-annual installments plus interest at 6.10% to 6.51% through 2021, secured by aircraft 22,557 41,592 Notes payable to banks, due in monthly installments, plus interest at 1.95% to 6.86% through 2029, secured by aircraft 438,878 476,369 Notes payable to banks, due in quarterly installments, plus interest at 3.39% to 5.08% through 2031, secured by aircraft 2,537,676 2,621,416 Notes payable to banks due in monthly installments, interest at 3.30% through 2019, secured by spare engines — 3,308 Long-term debt $ 3,017,523 $ 3,185,438 Current portion of long-term debt (367,954) (354,072) Less long-term portion of unamortized debt issue cost, net (20,580) (21,598) Long-term debt, net of current maturities and debt issue costs $ 2,628,989 $ 2,809,768 Current portion of long-term debt 367,954 354,072 Less current portion of unamortized debt issue cost, net (3,828) (3,866) Current portion of long-term debt, net of debt issue costs $ 364,126 $ 350,206 |
Schedule of maturities of long-term debt | The aggregate amounts of principal maturities of long-term debt as of December 31, 2019 were as follows (in thousands): 2020 $ 367,954 2021 352,005 2022 365,907 2023 374,906 2024 327,630 Thereafter 1,229,121 $ 3,017,523 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes | |
Schedule of components of provision (benefit) for income taxes | The provision (benefit) for income taxes includes the following components (in thousands): Year ended December 31, 2019 2018 2017 Current tax provision (benefit): Federal $ (4,395) $ (21,598) $ 5,853 State 891 1,465 180 Foreign — 1,575 — (3,504) (18,558) 6,033 Deferred tax provision (benefit): Federal 95,655 92,250 (166,890) State 14,055 12,250 20,133 109,710 104,500 (146,757) Provision (benefit) for income taxes $ 106,206 $ 85,942 $ (140,724) |
Schedule of income tax rate reconciliation | The following is a reconciliation between a federal income tax rate of 21% in 2019 and 2018 and 35% for 2017 of income before income taxes and the effective tax rate which is derived by dividing the provision (benefit) for income taxes by the income before the provision for income taxes (in thousands): Year ended December 31, 2019 2018 2017 Computed provision for income taxes at the statutory rate $ 93,724 $ 76,926 $ 100,864 Increase (decrease) in income taxes resulting from: State income tax provision, net of federal income tax benefit 15,645 12,711 7,778 Non-deductible expenses 3,934 1,956 3,230 Valuation allowance changes affecting the provision for income taxes (517) (1,187) 505 Foreign income taxes, net of federal & state benefit — 1,192 — Excess tax benefits from share-based compensation (3,525) (4,548) (5,377) Revaluation of net deferred taxes for the Tax Cuts and Jobs Act of 2017 — — (246,845) Other, net (3,055) (1,108) (879) Provision (benefit) for income taxes $ 106,206 $ 85,942 $ (140,724) |
Schedule of components of the net deferred tax assets and liabilities | The significant components of the Company’s net deferred tax assets and liabilities as of December 31, 2019 and 2018 are as follows (in thousands): As of December 31, 2019 2018 Deferred tax assets: Accrued benefits $ 20,848 $ 32,462 Net operating loss carryforward 358,685 344,375 AMT credit carryforward 4,397 15,744 Aircraft credits 9,114 35,924 Accrued reserves and other 17,225 18,710 Total deferred tax assets 410,269 447,215 Valuation allowance (892) (9,455) Deferred tax liabilities: Accelerated depreciation (1,032,957) (955,919) Total deferred tax liabilities (1,032,957) (955,919) Net deferred tax liability $ (623,580) $ (518,159) |
Schedule of unrecognized tax benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits for the year ended December 31, 2019 and 2018 is as follows (in thousands) : As of December 31, 2019 2018 Unrecognized tax benefits at the beginning of year $ 14,553 $ 2,223 Gross increases - current year tax positions — 13,899 Gross increases - prior year tax positions 67 — Gross decreases - prior year tax positions — (1,569) Unrecognized tax benefits at end of year $ 14,620 $ 14,553 Interest and penalties in year-end balance $ 67 $ — |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases | |
Summary of related terms and discount rates | As of December 31, 2019 Weighted-average remaining lease term Operating leases 6.84 years Weighted-average discount rate Operating leases 6.4% |
Summary of lease costs | The Company’s lease costs for 2019 and 2018 included the following components (in thousands): For the year ended December 31, 2019 2018 Operating lease cost $ 104,011 $ 185,337 Variable and short-term lease cost 5,232 5,143 Sublease income (1,436) — Total lease cost $ 107,807 $ 190,480 |
Schedule of future minimum rental payments for operating leases | 2020 $ 94,806 2021 84,285 2022 73,960 2023 68,581 2024 27,282 Thereafter 94,746 $ 443,660 |
Schedule of Future Minimum Rental Payments for Operating Leases | 2019 $ 87,256 2020 101,741 2021 90,787 2022 72,593 2023 65,749 Thereafter 59,820 $ 477,946 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Measurements | |
Schedule of assets measured at fair value on a recurring basis | As of December 31, 2019, the Company held certain assets that are required to be measured at fair value on a recurring basis. Assets measured at fair value on a recurring basis are summarized below (in thousands): Fair Value Measurements as of December 31, 2019 Total Level 1 Level 2 Level 3 Marketable Securities Bonds and bond funds $ 267,243 $ — $ 267,243 $ — Commercial paper 165,723 — 165,723 — $ 432,966 $ — $ 432,966 $ — Cash, Cash Equivalents and Restricted Cash 87,206 87,206 — — Total Assets Measured at Fair Value $ 520,172 $ 87,206 $ 432,966 $ — Fair Value Measurements as of December 31, 2018 Total Level 1 Level 2 Level 3 Marketable Securities Bonds and bond funds $ 229,783 $ — $ 229,783 $ — Commercial paper 131,162 — 131,162 — $ 360,945 $ — $ 360,945 $ — Cash, Cash Equivalents and Restricted Cash 328,384 328,384 — — Total Assets Measured at Fair Value $ 689,329 $ 328,384 $ 360,945 $ — |
Special Items (Tables)
Special Items (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Special Items | |
Summary of the components of special items | The following table summarizes the components of the Company's special items, for the year ended December 31, 2019, 2018 and 2017 (in thousands): Year ended December 31, 2019 2018 2017 Special items: Parts credit 1 $ 18,508 $ — $ — Employee severance 2 3,361 — — Total special items $ 21,869 $ — $ — (1) The Company terminated an agreement with an aircraft manufacturer that obligated the Company to future aircraft lease return conditions on aircraft the Company leased. In conjunction with the terminated agreement, the aircraft manufacturer released the Company from the future aircraft lease return obligations and the Company agreed to terminate aircraft part credits previously issued by the manufacturer to the Company. As a result of the terminated agreement, the Company recorded a non-cash expense of $18.5 million (pre-tax) during 2019 to write-off the terminated aircraft part credits, which was reflected as a special items operating expense in the consolidated statement of comprehensive income. These special items are reflected in the SkyWest Airlines operating expenses under Note 2 Segment Reporting . (2) During 2019, the Company incurred $3.4 million of employee severance related costs associated with the sale of ExpressJet that are also reflected in special items. These special items are reflected in the ExpressJet operating expenses under Note 2 Segment Reporting . |
Capital Transactions (Tables)
Capital Transactions (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Schedule of stock option activity | 2019 2018 2017 Weighted Weighted Average Aggregate Weighted Weighted Average Remaining Intrinsic Average Average Number of Exercise Contractual Value Number of Exercise Number of Exercise Options Price Term ($000) Options Price Options Price Outstanding at beginning of year 300,580 $ 13.70 3.0 years $ 9,249.4 458,103 $ 13.73 819,981 $ 13.58 Granted — — — — — — Exercised (232,514) 13.36 (157,523) 13.80 (356,209) 13.36 Cancelled (7,835) 15.86 — — (5,669) 14.33 Outstanding at end of year 60,231 14.74 3.1 years $ 3,005.1 300,580 13.70 458,103 13.73 Exercisable at December 31, 2019 60,231 14.74 3.1 years $ 3,005.1 Exercisable at December 31, 2018 235,672 13.36 2.7 years $ 7,330.7 |
Schedule of non-vested stock options | The following table summarizes the status of the Company’s non-vested stock options as of December 31, 2019: Weighted-Average Number of Grant-Date Shares Fair Value Non-vested shares at beginning of year 64,908 $ 5.32 Granted — — Vested (57,073) 5.27 Cancelled (7,835) 5.66 Non-vested shares at end of year — $ — |
Schedule of stock options outstanding | The following table summarizes information about the Company’s stock options outstanding at December 31, 2019: Options Outstanding Options Exercisable Weighted Average Number Remaining Weighted Average Number Weighted Average Range of Exercise Prices Outstanding Contractual Life Exercise Price Exercisable Exercise Price $13.00 to $13.99 2,034 2.1 years $ 13.51 2,034 $ 13.51 $14.00 to $15.00 58,197 3.1 years 14.78 58,197 14.78 $13.00 to $15.00 60,231 3.1 years $ 14.74 60,231 $ 14.74 |
Schedule of restricted stock activity | Weighted-Average Grant-Date Fair Number of RSUs Value Non-vested RSUs outstanding at December 31, 2016 926,931 $ 13.65 Granted 160,137 35.81 Vested (230,903) 12.01 Cancelled (40,575) 15.78 Non-vested RSUs outstanding at December 31, 2017 815,590 $ 18.35 Granted 115,044 53.40 Vested (330,580) 13.57 Cancelled (24,273) 27.77 Non-vested RSUs outstanding at December 31, 2018 575,781 $ 27.71 Granted 104,120 48.65 Vested (251,853) 14.79 Cancelled (143,362) 30.85 Non-vested RSUs outstanding at December 31, 2019 284,686 $ 45.21 |
Performance stock units | |
Schedule of non-vested stock options | Weighted-Average Grant-Date Number of PSUs Fair Value Non-vested PSUs outstanding at December 31, 2016 363,993 $ 14.23 Granted 119,315 35.81 Vested — — Cancelled (14,732) 15.00 Non-vested PSUs outstanding at December 31, 2017 468,576 $ 19.70 Granted 90,264 53.41 Additional PSUs awarded from the 2015 grant 92,335 13.62 Vested (277,029) 13.62 Cancelled (3,229) 30.09 Non-vested PSUs outstanding at December 31, 2018 370,917 $ 30.84 Granted 87,864 48.81 Additional PSUs awarded from the 2016 grant 67,853 14.80 Vested (203,582) 14.80 Cancelled (89,481) 34.70 Non-vested PSUs outstanding at December 31, 2019 233,571 $ 45.44 |
Retirement Plans and Employee_2
Retirement Plans and Employee Stock Purchase Plans (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Retirement Plans and Employee Stock Purchase Plans | |
Schedule of purchases made under the 2009 Employee Stock Purchase Plans | Year ended December 31, 2019 2018 2017 Number of shares purchased 65,148 60,950 88,362 Average price of shares purchased $ 48.58 $ 49.85 $ 33.96 |
Quarterly Financial Data (Una_2
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Data (Unaudited) | |
Schedule of Quarterly Financial Data (Unaudited) | Unaudited summarized financial data by quarter for 2019 and 2018 is as follows (in thousands, except per share data): Year ended December 31, 2019 First Second Third Fourth Quarter Quarter Quarter Quarter Year Operating revenues $ 723,694 $ 744,383 $ 760,295 $ 743,591 $ 2,971,963 Operating income 96,419 144,093 146,441 125,305 512,258 Net income (1) 88,181 88,052 91,339 72,527 340,099 Net income per common share: Basic 1.71 1.72 1.80 1.44 6.68 Diluted 1.69 1.71 1.79 1.43 6.62 Weighted average common shares: Basic: 51,440 51,145 50,746 50,395 50,932 Diluted: 52,098 51,477 51,129 50,796 51,375 (1) Net income for the first quarter of 2019 included a $46.5 million gain related to the sale of ExpressJet (see Note 13 Gain on Sale of ExpressJet for more details) and a $21.9 million special charge (see Note 8 Special Items for more details). Year ended December 31, 2018 First Second Third Fourth Quarter Quarter Quarter Quarter Year Operating revenues $ 783,400 $ 805,515 $ 829,275 $ 803,489 $ 3,221,679 Operating income 88,175 126,678 137,925 121,502 474,280 Net income 54,362 75,859 83,046 67,105 280,372 Net income per common share: Basic 1.05 1.46 1.60 1.30 5.40 Diluted 1.03 1.43 1.57 1.28 5.30 Weighted average common shares: Basic: 51,921 52,046 52,039 51,650 51,914 Diluted: 53,033 52,913 52,981 52,556 52,871 |
Nature of Operations and Summ_4
Nature of Operations and Summary of Significant Accounting Policies - Aircraft Fleet (Details) | 12 Months Ended |
Dec. 31, 2019aircraft | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of daily departures | 2,300 |
Number of aircraft held by entity | 544 |
CRJ 200 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 214 |
Number of seats on aircraft | 50 |
CRJ 700 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 126 |
CRJ 700 | Minimum | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of seats on aircraft | 65 |
CRJ 700 | Maximum | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of seats on aircraft | 76 |
CRJ 900 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 48 |
CRJ 900 | Minimum | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of seats on aircraft | 65 |
CRJ 900 | Maximum | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of seats on aircraft | 76 |
E175 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 156 |
E175 | Minimum | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of seats on aircraft | 65 |
E175 | Maximum | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of seats on aircraft | 76 |
Delta | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 199 |
Percentage of aggregate capacity operated | 41.20% |
Delta | CRJ 200 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 84 |
Delta | CRJ 700 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 13 |
Delta | CRJ 900 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 43 |
Delta | E175 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 59 |
United | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 183 |
Percentage of aggregate capacity operated | 37.90% |
United | CRJ 200 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 99 |
United | CRJ 700 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 19 |
United | E175 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 65 |
American | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 69 |
Percentage of aggregate capacity operated | 14.30% |
American | CRJ 200 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 7 |
American | CRJ 700 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 62 |
Alaska | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 32 |
Percentage of aggregate capacity operated | 6.60% |
Alaska | E175 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 32 |
Aircraft in scheduled service | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 483 |
Aircraft in scheduled service | CRJ 200 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 190 |
Aircraft in scheduled service | CRJ 700 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 94 |
Aircraft in scheduled service | CRJ 900 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 43 |
Aircraft in scheduled service | E175 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 156 |
Subleased to an un-affiliated entity | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 19 |
Subleased to an un-affiliated entity | CRJ 200 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 4 |
Subleased to an un-affiliated entity | CRJ 700 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 10 |
Subleased to an un-affiliated entity | CRJ 900 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 5 |
Other | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 42 |
Other | CRJ 200 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 20 |
Other | CRJ 700 | |
Nature of Operations and Summary of Significant Accounting Policies [Line Items] | |
Number of aircraft held by entity | 22 |
Nature of Operations and Summ_5
Nature of Operations and Summary of Significant Accounting Policies - Cash and Cash Equivalents (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Nature of Operations and Summary of Significant Accounting Policies | ||
Restricted cash | $ 0 | $ 0 |
Nature of Operations and Summ_6
Nature of Operations and Summary of Significant Accounting Policies - Marketable Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Schedule of Available-for-sale Securities [Line Items] | ||||
Total cash and cash equivalents | $ 87,206 | $ 328,384 | $ 181,792 | $ 146,766 |
Amortized Cost | 432,966 | 360,988 | ||
Gross unrealized holding losses | (43) | |||
Fair market value | 432,966 | 360,945 | ||
Total Assets Measured at Fair Value - Amortized cost | 520,172 | 689,372 | ||
Total cash and cash equivalents and available for sale securities, fair market value | $ 520,172 | 689,329 | ||
Marketable Securities | ||||
Maximum period for redemption | 1 year | |||
Bonds and bond funds | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | $ 267,243 | 229,825 | ||
Gross unrealized holding losses | (42) | |||
Fair market value | 267,243 | 229,783 | ||
Commercial paper | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||
Amortized Cost | 165,723 | 131,163 | ||
Gross unrealized holding losses | (1) | |||
Fair market value | $ 165,723 | $ 131,162 |
Nature of Operations and Summ_7
Nature of Operations and Summary of Significant Accounting Policies - Inventories (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Inventories | ||
Inventory allowance | $ 15.9 | $ 22.1 |
Nature of Operations and Summ_8
Nature of Operations and Summary of Significant Accounting Policies - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Aircraft, rotable spares, and spare engines | Maximum | |
Property and Equipment | |
Depreciable Life | 22 years |
Residual Value (as a percent) | 20.00% |
Ground equipment | |
Property and Equipment | |
Residual Value (as a percent) | 0.00% |
Ground equipment | Maximum | |
Property and Equipment | |
Depreciable Life | 10 years |
Office equipment | |
Property and Equipment | |
Residual Value (as a percent) | 0.00% |
Office equipment | Maximum | |
Property and Equipment | |
Depreciable Life | 7 years |
Leasehold improvements | |
Property and Equipment | |
Residual Value (as a percent) | 0.00% |
Leasehold improvements | Maximum | |
Property and Equipment | |
Depreciable Life | 15 years |
Buildings | |
Property and Equipment | |
Residual Value (as a percent) | 0.00% |
Buildings | Minimum | |
Property and Equipment | |
Depreciable Life | 20 years |
Buildings | Maximum | |
Property and Equipment | |
Depreciable Life | 39 years 6 months |
Nature of Operations and Summ_9
Nature of Operations and Summary of Significant Accounting Policies - Long-Lived Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Impairment of Long Lived and Intangible Assets | |||
Property and equipment and related assets | $ 5,394,681 | $ 5,005,744 | |
Impairment of long-lived assets | $ 0 | $ 0 | $ 0 |
Nature of Operations and Sum_10
Nature of Operations and Summary of Significant Accounting Policies - Capitalized Interest (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Capitalized Interest | |||
Capitalized interest costs | $ 1.6 | $ 1.5 | $ 1.4 |
Nature of Operations and Sum_11
Nature of Operations and Summary of Significant Accounting Policies - Flying Agreements (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019USD ($)aircraft | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2019USD ($)aircraft | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Agreements with other airlines | |||||||||||
Percentage of ASMs flown under fixed-fee arrangements | 82.00% | ||||||||||
Percentage of ASMs flown under pro-rate arrangements | 18.00% | ||||||||||
Revenues [Abstract] | |||||||||||
Operating revenues | $ | $ 743,591 | $ 760,295 | $ 744,383 | $ 723,694 | $ 783,400 | $ 805,515 | $ 829,275 | $ 803,489 | $ 2,971,963 | $ 3,221,679 | $ 3,122,592 |
Rental income under operating leases | |||||||||||
Operating lease income relating to lease payments | $ | 27,552 | ||||||||||
Operating lease income relating to lease payments | $ | 3,923 | 3,293 | |||||||||
Operating lease income relating to variable lease payments | $ | 9,608 | ||||||||||
Total operating revenues | $ | 2,971,963 | 3,221,679 | 3,122,592 | ||||||||
future minimum rental income | |||||||||||
2020 | $ | 32,724 | 32,724 | |||||||||
2021 | $ | 31,344 | 31,344 | |||||||||
2022 | $ | 24,786 | 24,786 | |||||||||
2023 | $ | 18,530 | 18,530 | |||||||||
2024 | $ | 18,222 | 18,222 | |||||||||
Thereafter | $ | 54,932 | 54,932 | |||||||||
Total | $ | 180,538 | 180,538 | |||||||||
Property and equipment and related assets | $ | 5,394,681 | 5,005,744 | 5,394,681 | 5,005,744 | |||||||
Accounts receivable | $ | 83,000 | 64,200 | $ 83,000 | 64,200 | |||||||
Alaska Capacity Purchase Agreement | |||||||||||
future minimum rental income | |||||||||||
Number of aircraft | 32 | ||||||||||
Sky West Airlines Inc | Delta Connection Agreement | |||||||||||
future minimum rental income | |||||||||||
Agreement term | 4 years 1 month 6 days | ||||||||||
Sky West Airlines Inc | Delta Connection Prorate Agreement | |||||||||||
future minimum rental income | |||||||||||
Notice period for termination of agreement | 30 days | ||||||||||
Sky West Airlines Inc | United Express Agreements | |||||||||||
future minimum rental income | |||||||||||
Agreement term | 4 years 3 months 18 days | ||||||||||
Sky West Airlines Inc | United Express Prorate Agreement | |||||||||||
future minimum rental income | |||||||||||
Notice period for termination of agreement | 120 days | ||||||||||
Sky West Airlines Inc | American Prorate Agreement | |||||||||||
future minimum rental income | |||||||||||
Notice period for termination of agreement | 120 days | ||||||||||
Third Party Lease | |||||||||||
future minimum rental income | |||||||||||
Property and equipment and related assets | $ | $ 97,000 | $ 97,000 | |||||||||
CRJ 200 | |||||||||||
future minimum rental income | |||||||||||
Number of seats on aircraft | 50 | ||||||||||
CRJ 200 | American Prorate Agreement | |||||||||||
future minimum rental income | |||||||||||
Number of aircraft | 7 | ||||||||||
CRJ 200 | Sky West Airlines Inc | Delta Connection Agreement | |||||||||||
future minimum rental income | |||||||||||
Number of aircraft | 55 | ||||||||||
CRJ 200 | Sky West Airlines Inc | Delta Connection Prorate Agreement | |||||||||||
future minimum rental income | |||||||||||
Number of aircraft | 29 | ||||||||||
CRJ 200 | Sky West Airlines Inc | United Express Agreements | |||||||||||
future minimum rental income | |||||||||||
Number of aircraft | 68 | ||||||||||
CRJ 200 | Sky West Airlines Inc | United Express Prorate Agreement | |||||||||||
future minimum rental income | |||||||||||
Number of aircraft | 31 | ||||||||||
CRJ 700 | Minimum | |||||||||||
future minimum rental income | |||||||||||
Number of seats on aircraft | 65 | ||||||||||
CRJ 700 | Maximum | |||||||||||
future minimum rental income | |||||||||||
Number of seats on aircraft | 76 | ||||||||||
CRJ 700 | American Capacity Purchase Agreement | |||||||||||
future minimum rental income | |||||||||||
Number of aircraft | 62 | ||||||||||
Agreement term | 4 years 1 month 6 days | ||||||||||
CRJ 700 | Sky West Airlines Inc | Delta Connection Agreement | |||||||||||
future minimum rental income | |||||||||||
Number of aircraft | 13 | ||||||||||
CRJ 700 | Sky West Airlines Inc | United Express Agreements | |||||||||||
future minimum rental income | |||||||||||
Number of aircraft | 19 | ||||||||||
CRJ 700 | American | |||||||||||
future minimum rental income | |||||||||||
Number of aircraft | 10 | ||||||||||
Number of aircrafts to be placed in service | 2 | 2 | |||||||||
CRJ 900 | Minimum | |||||||||||
future minimum rental income | |||||||||||
Number of seats on aircraft | 65 | ||||||||||
CRJ 900 | Maximum | |||||||||||
future minimum rental income | |||||||||||
Number of seats on aircraft | 76 | ||||||||||
CRJ 900 | Sky West Airlines Inc | Delta Connection Agreement | |||||||||||
future minimum rental income | |||||||||||
Number of aircraft | 43 | ||||||||||
CRJ 900 | Delta | |||||||||||
future minimum rental income | |||||||||||
Number of aircraft | 1 | ||||||||||
Agreement term | 9 years | ||||||||||
E175 | Minimum | |||||||||||
future minimum rental income | |||||||||||
Number of seats on aircraft | 65 | ||||||||||
E175 | Maximum | |||||||||||
future minimum rental income | |||||||||||
Number of seats on aircraft | 76 | ||||||||||
E175 | Alaska Capacity Purchase Agreement | |||||||||||
future minimum rental income | |||||||||||
Agreement term | 9 years 2 months 12 days | ||||||||||
E175 | Sky West Airlines Inc | Delta Connection Agreement | |||||||||||
future minimum rental income | |||||||||||
Number of aircraft | 59 | ||||||||||
Number of additional aircraft placed into service | 6 | ||||||||||
E175 | Sky West Airlines Inc | United Express Agreements | |||||||||||
future minimum rental income | |||||||||||
Number of aircraft | 65 | ||||||||||
E175 | Sky West Airlines Inc | American Capacity Purchase Agreement | |||||||||||
future minimum rental income | |||||||||||
Number of additional aircraft placed into service | 20 | ||||||||||
Flying agreements | |||||||||||
Revenues [Abstract] | |||||||||||
Operating revenues | $ | $ 2,889,265 | 3,169,520 | 3,078,297 | ||||||||
Rental income under operating leases | |||||||||||
Total operating revenues | $ | 2,889,265 | 3,169,520 | 3,078,297 | ||||||||
future minimum rental income | |||||||||||
Accounts receivable | $ | $ 58,800 | $ 52,700 | 58,800 | 52,700 | |||||||
Flight operations | |||||||||||
Revenues [Abstract] | |||||||||||
Operating revenues | $ | 1,538,062 | 1,856,253 | 1,805,510 | ||||||||
Aircraft lease | |||||||||||
Revenues [Abstract] | |||||||||||
Operating revenues | $ | 830,247 | 814,518 | 834,366 | ||||||||
Prorate agreements | |||||||||||
Revenues [Abstract] | |||||||||||
Operating revenues | $ | 520,956 | 498,749 | 438,421 | ||||||||
Airport customer service revenue | |||||||||||
Revenues [Abstract] | |||||||||||
Operating revenues | $ | 45,538 | 48,236 | 41,002 | ||||||||
Airport customer service and other | |||||||||||
Rental income under operating leases | |||||||||||
Total operating revenues | $ | $ 82,698 | $ 52,159 | $ 44,295 |
Nature of Operations and Sum_12
Nature of Operations and Summary of Significant Accounting Policies - Net Income Per Common Share and Fair Value (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019USD ($)$ / sharesshares | Sep. 30, 2019USD ($)$ / sharesshares | Jun. 30, 2019USD ($)$ / sharesshares | Mar. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Sep. 30, 2018USD ($)$ / sharesshares | Jun. 30, 2018USD ($)$ / sharesshares | Mar. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2019USD ($)segment$ / sharesshares | Dec. 31, 2018USD ($)segment$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | |
Net Income Per Common Share | |||||||||||
Number of outstanding units not included in computation of Diluted EPS (in shares) | 150,000 | 207,000 | 284,000 | ||||||||
Numerator: | |||||||||||
Net income | $ | $ 72,527 | $ 91,339 | $ 88,052 | $ 88,181 | $ 54,362 | $ 75,859 | $ 83,046 | $ 67,105 | $ 340,099 | $ 280,372 | $ 428,907 |
Denominator: | |||||||||||
Basic earnings per share weighted average shares (in shares) | 50,395,000 | 50,746,000 | 51,145,000 | 51,440,000 | 51,921,000 | 52,046,000 | 52,039,000 | 51,650,000 | 50,932,000 | 51,914,000 | 51,804,000 |
Dilution due to stock options and restricted stock units (in shares) | 443,000 | 957,000 | 1,296,000 | ||||||||
Diluted earnings per share weighted average shares | 50,796,000 | 51,129,000 | 51,477,000 | 52,098,000 | 53,033,000 | 52,913,000 | 52,981,000 | 52,556,000 | 51,375,000 | 52,871,000 | 53,100,000 |
Basic earnings per share (in dollars per share) | $ / shares | $ 1.44 | $ 1.80 | $ 1.72 | $ 1.71 | $ 1.05 | $ 1.46 | $ 1.60 | $ 1.30 | $ 6.68 | $ 5.40 | $ 8.28 |
Diluted earnings per share (in dollars per share) | $ / shares | $ 1.43 | $ 1.79 | $ 1.71 | $ 1.69 | $ 1.03 | $ 1.43 | $ 1.57 | $ 1.28 | $ 6.62 | $ 5.30 | $ 8.08 |
Fair Value of Financial Instruments | |||||||||||
Fair value of long-term debt | $ | $ 3,049,100 | $ 3,157,300 | $ 3,049,100 | $ 3,157,300 | |||||||
Total long-term debt | $ | $ 3,017,523 | $ 3,185,438 | $ 3,017,523 | $ 3,185,438 | |||||||
Segment Reporting | |||||||||||
Number of operating segments | segment | 3 | ||||||||||
Number of reporting segments | segment | 2 |
Nature of Operations and Sum_13
Nature of Operations and Summary of Significant Accounting Policies - Recent Accounting Pronouncements (Details) - Adjustment - Topic 326 $ in Millions | Jan. 01, 2020USD ($) |
Minimum | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Credit loss | $ 7 |
Maximum | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Credit loss | $ 12 |
Segment Reporting (Details)
Segment Reporting (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2018USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2019USD ($)segment | Dec. 31, 2018USD ($)segment | Dec. 31, 2017USD ($) | |
Segment Reporting | |||||||||||
Number of operating segments | segment | 3 | ||||||||||
Number of reporting segments | segment | 2 | ||||||||||
Operating revenues | $ 743,591 | $ 760,295 | $ 744,383 | $ 723,694 | $ 783,400 | $ 805,515 | $ 829,275 | $ 803,489 | $ 2,971,963 | $ 3,221,679 | $ 3,122,592 |
Operating expense | 2,459,705 | 2,747,399 | 2,734,393 | ||||||||
Depreciation and amortization expense | 368,098 | 334,589 | 292,768 | ||||||||
Special items | $ 21,900 | 21,869 | |||||||||
Interest expense | 127,755 | 120,409 | 104,925 | ||||||||
Segment profit (loss) | 384,503 | 353,871 | 283,274 | ||||||||
Identifiable intangible assets, other than goodwill | 4,896 | ||||||||||
Total assets | 6,657,129 | 6,313,212 | 6,657,129 | 6,313,212 | 5,474,400 | ||||||
Capital expenditures (including non-cash) | 846,470 | 1,156,276 | 689,398 | ||||||||
SkyWest Airlines | |||||||||||
Segment Reporting | |||||||||||
Operating revenues | 2,478,681 | 2,346,251 | 2,092,368 | ||||||||
Operating expense | 2,214,632 | 2,022,560 | 1,807,540 | ||||||||
Depreciation and amortization expense | 168,246 | 155,511 | 134,563 | ||||||||
Special items | 18,508 | ||||||||||
Interest expense | 13,525 | 17,021 | 21,544 | ||||||||
Segment profit (loss) | 250,524 | 306,670 | 263,284 | ||||||||
Total assets | 2,728,964 | 2,531,707 | 2,728,964 | 2,531,707 | 2,245,051 | ||||||
Capital expenditures (including non-cash) | 270,191 | 149,731 | 124,955 | ||||||||
ExpressJet Airlines Inc | |||||||||||
Segment Reporting | |||||||||||
Operating revenues | 24,050 | 564,202 | 790,282 | ||||||||
Operating expense | 28,690 | 577,608 | 818,683 | ||||||||
Depreciation and amortization expense | 971 | 37,290 | 51,982 | ||||||||
Special items | 3,361 | ||||||||||
Interest expense | 2,340 | 4,127 | |||||||||
Segment profit (loss) | (4,640) | (15,746) | (32,528) | ||||||||
Identifiable intangible assets, other than goodwill | 4,896 | ||||||||||
Total assets | 279,303 | 279,303 | 599,122 | ||||||||
Capital expenditures (including non-cash) | 10,137 | 14,278 | |||||||||
SkyWest Leasing | |||||||||||
Segment Reporting | |||||||||||
Operating revenues | 469,232 | 311,226 | 239,942 | ||||||||
Operating expense | 216,383 | 147,231 | 108,170 | ||||||||
Depreciation and amortization expense | 198,881 | 141,788 | 106,223 | ||||||||
Interest expense | 114,230 | 101,048 | 79,254 | ||||||||
Segment profit (loss) | 138,619 | 62,947 | 52,518 | ||||||||
Total assets | $ 3,928,165 | $ 3,502,202 | 3,928,165 | 3,502,202 | 2,630,227 | ||||||
Capital expenditures (including non-cash) | $ 576,279 | $ 996,408 | $ 550,165 |
Long-term Debt (Details)
Long-term Debt (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019USD ($)aircraft | Dec. 31, 2018USD ($) | |
Debt Instrument [Line Items] | ||
Total long-term debt | $ 3,017,523 | $ 3,185,438 |
Current portion of long-term debt | (367,954) | (354,072) |
Less long-term portion of unamortized debt issue cost, net | (20,580) | (21,598) |
Long-term debt, net of current maturities and debt issue costs | 2,628,989 | 2,809,768 |
Current portion of long-term debt | 367,954 | 354,072 |
Less current portion of unamortized debt issue cost, net | (3,828) | (3,866) |
Current portion of long-term debt, net of debt issue costs | 364,126 | 350,206 |
Debt issued to purchase of aircraft | $ 14,500 | |
Effective interest rate (as a percent) | 4.20% | |
Aggregate amounts of principal maturities of long-term debt | ||
2020 | $ 367,954 | |
2021 | 352,005 | |
2022 | 365,907 | |
2023 | 374,906 | |
2024 | 327,630 | |
Thereafter | 1,229,121 | |
Repayment of debt in cash | 30,100 | 43,500 |
Total repayment of debt | 30,100 | 43,500 |
Letters of credit | 8,800 | 9,700 |
Current borrowing capacity | 66,200 | 65,300 |
Letters of credit and surety bonds outstanding with various banks and surety institutions | $ 61,700 | 78,700 |
E175 | ||
Debt Instrument [Line Items] | ||
Number of aircraft delivered | aircraft | 10 | |
Purchase of aircraft financed through long-term debt | $ 200,000 | |
Debt instrument, term | 12 years | |
Purchased, previously-leased aircraft | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 2.00% | |
Debt instrument, term | 18 months | |
Number of aircraft purchased | aircraft | 2 | |
Minimum | E175 | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 3.40% | |
Maximum | E175 | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 4.10% | |
Notes payable to banks, due in semi-annual installments, variable interest based on LIBOR, or with an interest rate of 4.00% through 2019, secured by aircraft | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 4.00% | |
Total long-term debt | 6,429 | |
Notes payable to a financing company, due in semi-annual installments, with a fixed interest rate of 3.25% through 2021, secured by aircraft | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 3.25% | |
Total long-term debt | $ 18,412 | 36,324 |
Notes payable to banks, due in semi-annual installments plus interest at 6.10% to 6.51% through 2021, secured by aircraft | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 22,557 | 41,592 |
Notes payable to banks, due in semi-annual installments plus interest at 6.10% to 6.51% through 2021, secured by aircraft | Minimum | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 6.10% | |
Notes payable to banks, due in semi-annual installments plus interest at 6.10% to 6.51% through 2021, secured by aircraft | Maximum | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 6.51% | |
Notes payable to banks, due in monthly installments, plus interest at 1.95% to 6.86% through 2029, secured by aircraft | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 438,878 | 476,369 |
Notes payable to banks, due in monthly installments, plus interest at 1.95% to 6.86% through 2029, secured by aircraft | Minimum | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 1.95% | |
Notes payable to banks, due in monthly installments, plus interest at 1.95% to 6.86% through 2029, secured by aircraft | Maximum | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 6.86% | |
Notes payable to banks, due in quarterly installments, plus interest at 3.39% to 5.08% through 2031, secured by aircraft | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 2,537,676 | 2,621,416 |
Notes payable to banks, due in quarterly installments, plus interest at 3.39% to 5.08% through 2031, secured by aircraft | Minimum | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 3.39% | |
Notes payable to banks, due in quarterly installments, plus interest at 3.39% to 5.08% through 2031, secured by aircraft | Maximum | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 5.08% | |
Notes payable to banks due in monthly installments, interest based on LIBOR interest at 3.30% through 2019, secured by spare engines | ||
Debt Instrument [Line Items] | ||
Interest rate (as a percent) | 3.30% | |
Total long-term debt | 3,308 | |
Line of credit | ||
Aggregate amounts of principal maturities of long-term debt | ||
Maximum borrowing capacity | $ 75,000 | 75,000 |
Amount outstanding | $ 0 | $ 0 |
LIBOR | Line of credit | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 2.50% |
Income Taxes - Provision (Detai
Income Taxes - Provision (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current tax provision (benefit): | |||
Federal | $ (4,395) | $ (21,598) | $ 5,853 |
State | 891 | 1,465 | 180 |
Foreign | 1,575 | ||
Total current tax provision (benefit) | (3,504) | (18,558) | 6,033 |
Deferred tax provision (benefit): | |||
Federal | 95,655 | 92,250 | (166,890) |
State | 14,055 | 12,250 | 20,133 |
Total deferred tax provision (benefit) | 109,710 | 104,500 | (146,757) |
Provision (benefit) for income taxes | $ 106,206 | $ 85,942 | $ (140,724) |
Income Taxes - Reconciliation (
Income Taxes - Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statutory Federal income tax rate (as a percent) | 21.00% | 21.00% | 35.00% |
Reconciliation | |||
Computed provision for income taxes at the statutory rate | $ 93,724 | $ 76,926 | $ 100,864 |
State income tax provision, net of federal income tax benefit | 15,645 | 12,711 | 7,778 |
Non-deductible expenses | 3,934 | 1,956 | 3,230 |
Valuation allowance changes affecting the provision for income taxes | (517) | (1,187) | 505 |
Foreign income taxes, net of federal & state benefit | 1,192 | ||
Excess tax benefits from share based compensation | (3,525) | (4,548) | (5,377) |
Revaluation of net deferred taxes for the Tax Cuts and Jobs Act of 2017 | (246,845) | ||
Other, net | (3,055) | (1,108) | (879) |
Provision (benefit) for income taxes | 106,206 | 85,942 | (140,724) |
Deferred tax assets: | |||
Accrued benefits | 20,848 | 32,462 | |
Net operating loss carryforward | 358,685 | 344,375 | |
AMT credit carryforward | 4,397 | 15,744 | |
Aircraft credits | 9,114 | 35,924 | |
Accrued reserves and other | 17,225 | 18,710 | |
Total deferred tax assets | 410,269 | 447,215 | |
Valuation allowance | (892) | (9,455) | |
Deferred tax liabilities: | |||
Accelerated depreciation | (1,032,957) | (955,919) | |
Total deferred tax liabilities | (1,032,957) | (955,919) | |
Net deferred tax liability | (623,580) | (518,159) | |
Accounting Standards Update 2016-09 | |||
Reconciliation | |||
Benefit from share-based compensation | 3,500 | 4,500 | 5,400 |
ExpressJet | State | |||
Reconciliation | |||
Valuation allowance | $ 500 | $ 1,200 | $ 500 |
Income Taxes - Net Operating Lo
Income Taxes - Net Operating Losses and Tax Rates (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Net operating losses | |||
Statutory Federal income tax rate (as a percent) | 21.00% | 21.00% | 35.00% |
Alternative minimum tax credit which does not expire | $ 4.4 | $ 8.8 | |
Tax credit recovery period | 2 years | ||
Federal | |||
Net operating losses | |||
Operating loss carryforward | $ 1,581.1 | 1,504.9 | |
Estimated effective tax rate on net operating losses | 21.00% | ||
State | |||
Net operating losses | |||
Operating loss carryforward | $ 766.4 | $ 562 | |
Estimated effective tax rate on net operating losses | 3.36% |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Income Taxes | |
Unrecognized tax benefits at the beginning of year | $ 14,553,000 |
Gross increases - prior year tax positions | 67,000 |
Unrecognized tax benefits at end of year | 14,620,000 |
Interest and penalties in year-end balance | 67,000 |
Interest expense related to uncertain tax positions | $ 67,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | 12 Months Ended | ||
Dec. 31, 2019USD ($)employee | Dec. 31, 2018USD ($) | Dec. 31, 2017 | |
Concentration Risk and Significant Customers | |||
Accrued workers' compensation liability | $ | $ 23,900,000 | $ 42,000,000 | |
Allowance for doubtful accounts | $ | $ 18,000 | $ 158,000 | |
Revenue from rights, concentration risk | Customer concentration risk | Delta, United, and Continental Combined | |||
Concentration Risk and Significant Customers | |||
Concentration risk (as a percent) | 77.60% | 81.40% | 82.90% |
Full-time equivalent number of employees | Labor force concentration risk | |||
Concentration Risk and Significant Customers | |||
Number of employees | employee | 13,700 | ||
SkyWest Airlines | Full-time equivalent number of employees | Unionized employees | |||
Concentration Risk and Significant Customers | |||
Approximate number of active employees | employee | 0 |
Leases - Leases (Details)
Leases - Leases (Details) $ in Thousands | Jan. 01, 2019USD ($) | Sep. 30, 2019USD ($)aircraft | Mar. 31, 2019USD ($)aircraft | Dec. 31, 2019USD ($)item | Dec. 31, 2018USD ($) |
Lessee, Lease, Description [Line Items] | |||||
Number of aircraft leased | item | 94 | ||||
Operating lease right-of-use assets | $ 336,009 | ||||
Current maturities of lease liabilities | 94,806 | ||||
Noncurrent operating leases | 259,237 | ||||
Operating leases | $ 75,400 | ||||
Weighted-average remaining lease term: Operating leases | 6 years 10 months 2 days | ||||
Weighted-average discount rate: Operating leases | 6.40% | ||||
Lease costs | |||||
Operating lease cost | $ 104,011 | $ 185,337 | |||
Variable and short-term lease cost | 5,232 | 5,143 | |||
Sublease income | (1,436) | ||||
Total lease cost | $ 107,807 | $ 190,480 | |||
Aircraft | |||||
Lessee, Lease, Description [Line Items] | |||||
Number of aircraft acquired | aircraft | 4 | 52 | |||
Payments for acquired aircraft | $ 30,000 | $ 111,700 | |||
Impairment adjustment on retained earnings | $ 13,100 | ||||
Aircraft | Minimum | |||||
Lessee, Lease, Description [Line Items] | |||||
Remaining lease term | 1 year | ||||
Aircraft | Maximum | |||||
Lessee, Lease, Description [Line Items] | |||||
Remaining lease term | 10 years | ||||
Airport Facilities | Minimum | |||||
Lessee, Lease, Description [Line Items] | |||||
Remaining lease term | 1 month | ||||
Airport Facilities | Maximum | |||||
Lessee, Lease, Description [Line Items] | |||||
Remaining lease term | 37 years |
Leases - Future Minimum Rental
Leases - Future Minimum Rental Payment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Future minimum rental payments required under operating leases | |||
2020 | $ 94,806 | ||
2021 | 84,285 | ||
2022 | 73,960 | ||
2023 | 68,581 | ||
2024 | 27,282 | ||
Thereafter | 94,746 | ||
Total | 443,660 | ||
Total rental expense for non-cancelable aircraft operating leases | $ 154,900 | $ 215,800 | |
Total rental expense for non-cancelable aircraft operating leases | 72,000 | ||
Minimum rental expense for airport station rents | 19,600 | $ 30,300 | |
Minimum rental expense for airport station rents | $ 23,100 | ||
Future minimum rental payments required under operating leases | |||
2019 | 87,256 | ||
2020 | 101,741 | ||
2021 | 90,787 | ||
2022 | 72,593 | ||
2023 | 65,749 | ||
Thereafter | 59,820 | ||
Total future lease obligations | $ 477,946 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value Measurements | ||
Marketable securities | $ 432,966 | $ 360,945 |
Total assets measured at fair value | 520,172 | 689,372 |
Fair Value of Financial Instruments | ||
Fair value of long-term debt | 3,049,100 | 3,157,300 |
Recurring | Fair value | ||
Fair Value Measurements | ||
Marketable securities | 432,966 | 360,945 |
Cash, Cash Equivalents and Restricted Cash | 87,206 | 328,384 |
Total assets measured at fair value | 520,172 | 689,329 |
Recurring | Fair value | Bonds and bond funds | ||
Fair Value Measurements | ||
Marketable securities | 267,243 | 229,783 |
Recurring | Fair value | Commercial paper | ||
Fair Value Measurements | ||
Marketable securities | 165,723 | 131,162 |
Recurring | Level 1 | ||
Fair Value Measurements | ||
Cash, Cash Equivalents and Restricted Cash | 87,206 | 328,384 |
Total assets measured at fair value | 87,206 | 328,384 |
Recurring | Level 2 | ||
Fair Value Measurements | ||
Marketable securities | 432,966 | 360,945 |
Total assets measured at fair value | 432,966 | 360,945 |
Recurring | Level 2 | Bonds and bond funds | ||
Fair Value Measurements | ||
Marketable securities | 267,243 | 229,783 |
Recurring | Level 2 | Commercial paper | ||
Fair Value Measurements | ||
Marketable securities | $ 165,723 | $ 131,162 |
Special Items (Details)
Special Items (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2019 | |
Special Items | ||
Parts credit | $ 18,508 | |
Employee severance | 3,361 | |
Total Special items | $ 21,900 | $ 21,869 |
Capital Transactions - Preferre
Capital Transactions - Preferred Stock (Details) - shares | Dec. 31, 2019 | Dec. 31, 2018 |
Preferred Stock | ||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock outstanding (in shares) | 0 |
Capital Transactions - Stock Co
Capital Transactions - Stock Compensation (Details) - USD ($) | 12 Months Ended | |||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | May 04, 2010 | |
Share-Based Compensation | ||||||
Performance period | 90 days | |||||
Compensation expenses | ||||||
Stock based compensation expense | $ 10,274,000 | $ 13,105,000 | $ 10,580,000 | |||
Employee severance related costs | 7,900,000 | |||||
Forfeiture credit partially offset | $ 4,500,000 | |||||
Director | ||||||
Share-Based Compensation | ||||||
Granted (in shares) | 18,576 | 15,165 | ||||
Granted (in dollars per share) | $ 48.45 | $ 53.40 | $ 35.81 | |||
Number of shares | ||||||
Granted (in shares) | 18,576 | 15,165 | ||||
Weighted Average Grant-Date Fair Value | ||||||
Granted (in dollars per share) | $ 48.45 | $ 53.40 | $ 35.81 | |||
Number of Options | ||||||
Granted (in shares) | 22,617 | |||||
Non-vested stock options | ||||||
Granted (in shares) | 22,617 | |||||
Restricted stock grants and performance stock units | ||||||
Compensation expenses | ||||||
Total unrecognized compensation cost | $ 10,000,000 | |||||
Unrecognized compensation cost recognized over a weighted average period (in years) | 1 month 21 days | |||||
Employee stock options | ||||||
Share-Based Compensation | ||||||
Options outstanding (in shares) | 300,580 | 458,103 | 458,103 | 60,231 | 300,580 | |
Compensation expenses | ||||||
Period from grant date after which stock options become exercisable, minimum (in months) | 6 months | |||||
Period from grant date within which incentive stock options are exercisable, maximum (in years) | 7 years | |||||
Number of Options | ||||||
Outstanding at the beginning of the period (in shares) | 300,580 | 458,103 | 819,981 | |||
Exercised (in shares) | (232,514) | (157,523) | (356,209) | |||
Cancelled (in shares) | (7,835) | (5,669) | ||||
Outstanding at the end of the period (in shares) | 60,231 | 300,580 | 458,103 | |||
Exercisable (in shares) | 60,231 | 235,672 | ||||
Weighted Average Exercise Price | ||||||
Outstanding at the beginning of the period (in dollars per share) | $ 13.70 | $ 13.73 | $ 13.58 | |||
Exercised (in dollars per share) | 13.36 | 13.80 | 13.36 | |||
Cancelled (in dollars per share) | 15.86 | 14.33 | ||||
Outstanding at the end of the period (in dollars per share) | $ 14.74 | $ 13.70 | $ 13.73 | |||
Exercisable (in dollars per share) | $ 14.74 | $ 13.36 | ||||
Weighted Average Remaining Contractual Term | ||||||
Outstanding, Weighted Average Remaining Contractual Term (in years) | 3 years 1 month 6 days | 3 years | ||||
Exercisable, Weighted Average Remaining Contractual Term (in years) | 3 years 1 month 6 days | 2 years 8 months 12 days | ||||
Aggregate Intrinsic Value | ||||||
Average intrinsic value of shares outstanding | $ 3,005,100 | $ 9,249,400 | ||||
Average intrinsic value of shares exercisable | $ 3,005,100 | $ 7,330,700 | ||||
Total intrinsic value of options exercised | $ 10,500,000 | $ 7,100,000 | $ 9,940,000 | |||
Non-vested stock options | ||||||
Non-vested shares at beginning of year (in shares) | 64,908 | |||||
Vested (in shares) | (57,073) | |||||
Cancelled (in shares) | (7,835) | |||||
Non-vested shares at end of year (in shares) | 64,908 | |||||
Weighted Average Grant-Date Fair Value | ||||||
Non-vested shares at beginning of year (in dollars per share) | $ 5.32 | |||||
Vested (in dollars per share) | 5.27 | |||||
Cancelled (in dollars per share) | $ 5.66 | |||||
Non-vested shares at end of year (in dollars per share) | $ 5.32 | |||||
Performance stock units | ||||||
Share-Based Compensation | ||||||
Granted (in shares) | 87,864 | 90,264 | 119,315 | |||
Granted (in dollars per share) | $ 48.81 | $ 53.41 | $ 35.81 | |||
Performance period | 3 years | |||||
Number of shares | ||||||
Nonvested sharess at the beginning of the period (in shares) | 370,917 | 468,576 | 363,993 | |||
Granted (in shares) | 87,864 | 90,264 | 119,315 | |||
Additional shares awarded from the 2015 grant | 67,853 | 92,335 | ||||
Vested (in shares) | (203,582) | (277,029) | ||||
Cancelled (in shares) | (89,481) | (3,229) | (14,732) | |||
Nonvested shares at the end of the period (in shares) | 233,571 | 370,917 | 468,576 | |||
Weighted Average Grant-Date Fair Value | ||||||
Nonvested shares at the beginning of the period (in dollars per share) | $ 30.84 | $ 19.70 | $ 14.23 | |||
Granted (in dollars per share) | 48.81 | 53.41 | 35.81 | |||
Additional shares awarded from the 2015 grant (in dollars per share) | 14.80 | 13.62 | ||||
Vested (in dollars per share) | 14.80 | 13.62 | ||||
Cancelled (in dollars per share) | 34.70 | 30.09 | 15 | |||
Nonvested shares at the end of the period (in dollars per share) | $ 45.44 | $ 30.84 | $ 19.70 | |||
Performance stock units | Maximum | ||||||
Share-Based Compensation | ||||||
Award percentage | 200.00% | 200.00% | 200.00% | |||
Performance stock units | Minimum | ||||||
Share-Based Compensation | ||||||
Award percentage | 0.00% | 0.00% | 0.00% | |||
Restricted stock units | ||||||
Share-Based Compensation | ||||||
Granted (in shares) | 104,120 | 115,044 | 160,137 | |||
Granted (in dollars per share) | $ 48.65 | $ 53.40 | $ 35.81 | |||
Number of shares | ||||||
Nonvested sharess at the beginning of the period (in shares) | 575,781 | 815,590 | 926,931 | |||
Granted (in shares) | 104,120 | 115,044 | 160,137 | |||
Vested (in shares) | (251,853) | (330,580) | (230,903) | |||
Cancelled (in shares) | (143,362) | (24,273) | (40,575) | |||
Nonvested shares at the end of the period (in shares) | 284,686 | 575,781 | 815,590 | |||
Weighted Average Grant-Date Fair Value | ||||||
Nonvested shares at the beginning of the period (in dollars per share) | $ 27.71 | $ 18.35 | $ 13.65 | |||
Granted (in dollars per share) | 48.65 | 53.40 | 35.81 | |||
Vested (in dollars per share) | 14.79 | 13.57 | 12.01 | |||
Cancelled (in dollars per share) | 30.85 | 27.77 | 15.78 | |||
Nonvested shares at the end of the period (in dollars per share) | $ 45.21 | $ 27.71 | $ 18.35 | |||
Long Term Incentive Plan 2010 | ||||||
Share-Based Compensation | ||||||
Number of shares authorized | 4,500,000 | |||||
Shares remaining available for future issuance | 4,400,000 | |||||
Long Term Incentive Plan 2010 | Restricted stock units | ||||||
Share-Based Compensation | ||||||
Vesting period | 3 years | |||||
Granted (in dollars per share) | $ 48.65 | |||||
Weighted Average Grant-Date Fair Value | ||||||
Granted (in dollars per share) | $ 48.65 | |||||
Long Term Incentive Plan 2010 | Restricted stock units | Director | ||||||
Share-Based Compensation | ||||||
Granted (in shares) | 104,120 | |||||
Number of shares | ||||||
Granted (in shares) | 104,120 |
Capital Transactions - Informat
Capital Transactions - Information About Stock Options Outstanding (Details) - Employee stock options | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
$13.00 to $13.99 | |
Stock options, exercise price | |
Exercise price range, low end of range (in dollars per share) | $ 13 |
Exercise price range, high end of range (in dollars per share) | $ 13.99 |
Options Outstanding | |
Number of options outstanding (in shares) | shares | 2,034 |
Options outstanding, Weighted Average Remaining Contractual Life | 2 years 1 month 6 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 13.51 |
Options Exercisable | |
Number of options Exercisable (in shares) | shares | 2,034 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 13.51 |
$14.00 to $15.00 | |
Stock options, exercise price | |
Exercise price range, low end of range (in dollars per share) | 14 |
Exercise price range, high end of range (in dollars per share) | $ 15 |
Options Outstanding | |
Number of options outstanding (in shares) | shares | 58,197 |
Options outstanding, Weighted Average Remaining Contractual Life | 3 years 1 month 6 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 14.78 |
Options Exercisable | |
Number of options Exercisable (in shares) | shares | 58,197 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 14.78 |
$13.00 to $15.00 | |
Stock options, exercise price | |
Exercise price range, low end of range (in dollars per share) | 13 |
Exercise price range, high end of range (in dollars per share) | $ 15 |
Options Outstanding | |
Number of options outstanding (in shares) | shares | 60,231 |
Options outstanding, Weighted Average Remaining Contractual Life | 3 years 1 month 6 days |
Options Outstanding, Weighted Average Exercise Price (in dollars per share) | $ 14.74 |
Options Exercisable | |
Number of options Exercisable (in shares) | shares | 60,231 |
Options Exercisable, Weighted Average Exercise Price (in dollars per share) | $ 14.74 |
Retirement Plans and Employee_3
Retirement Plans and Employee Stock Purchase Plans - Retirement Plans (Details) - SkyWest Plan - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Retirement Plans | |||
Service period required to be completed to be eligible to participate in plan | 90 days | ||
Required age for an employee to be eligible to participate in plan | 18 years | ||
Percentage of employer matching contribution based on length of service | 100.00% | ||
Minimum benefit plan percentage of participants compensation eligible for employer matching contribution based on position and years of service | 2.00% | ||
Maximum benefit plan percentage of participants compensation eligible for employer matching contribution based on position and years of service | 12.00% | ||
Company's combined contributions | $ 40.7 | $ 35.6 | $ 26.1 |
Retirement Plans and Employee_4
Retirement Plans and Employee Stock Purchase Plans - Employee Stock Purchase Plans (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Employee Stock Purchase Plans | |||
Service period required to be completed for an employee to be eligible to participate in plan, minimum | 90 days | ||
Ownership interest in Company common stock to disqualify employee from participation in plan, maximum (as a percent) | 5.00% | ||
Maximum percentage of base salary which can be contributed by the employees | 15.00% | ||
Maximum amount of base salary which can be contributed annually by the employees | $ 25,000 | ||
Discount rate at which common stock can be purchased by the plan participant (as a percent) | 5.00% | ||
Summary of purchases made under the 2010 and 1995 Employee Stock Purchase Plans | |||
Number of shares purchased | 65,148 | 60,950 | 88,362 |
Average price of shares purchased (in dollars per share) | $ 48.58 | $ 49.85 | $ 33.96 |
2009 Stock Purchase Plan | |||
Summary of purchases made under the 2010 and 1995 Employee Stock Purchase Plans | |||
Stock based compensation expense | $ 0 | $ 0 | $ 0 |
Stock Repurchase (Details)
Stock Repurchase (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Stock Repurchase | |||
Common stock authorized for repurchase, maximum (in shares) | 250 | ||
Common stock remaining number of shares authorized to repurchase | 159.6 | ||
Common stock repurchased (in shares) | 1.7 | 1 | 0.5 |
Common stock repurchased, value | $ 94.6 | $ 54.4 | $ 20 |
Weighted average price per share of common stock (in dollars per share) | $ 56.86 | $ 56.25 | $ 41.36 |
Payment of income tax obligation on employee equity awards | $ 9.3 | $ 13.6 | $ 5.1 |
Related-Party Transactions (Det
Related-Party Transactions (Details) - USD ($) | Jun. 13, 2019 | Dec. 31, 2019 |
Related Party Transactions | ||
Common stock purchased and cancelled (in shares) | 268,025 | |
Share price (in dollars per share) | $ 60.24 | |
Period of Trading Days Prior to Repurchase to Calculate Volume Weighted Average Closing Price | 5 days | |
Affiliated entity | ||
Related Party Transactions | ||
Purchase from related party | $ 93,540 |
Gain on Sale of ExpressJet (Det
Gain on Sale of ExpressJet (Details) $ in Thousands | Jan. 22, 2019USD ($)aircraft | Jan. 11, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2019USD ($) |
Gain on sale | $ 46,500 | $ 46,500 | $ 46,525 | |
Interest rate (as a percent) | 6.85% | |||
Asset Purchase Agreement | ExpressJet | ||||
Proceeds from sale of equipment | $ 60,800 | |||
Stock Purchase Agreement | ExpressJet | ||||
Cash received from stock sale | $ 18,800 | |||
Amount loaned to Kair Enterprises, Inc | $ 26,000 | |||
Number of aircraft in early lease buyout | aircraft | 16 |
Investment in Other Companies (
Investment in Other Companies (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($)engine | |
Number of spare engines sold to Aero Engines | engine | 14 |
Aero Engines, LLC. | |
Payments to acquire interest in joint venture | $ 22,300 |
Investment ownership (as a percent) | 75.00% |
Number of spare engines purchased | engine | 14 |
Long-term debt | $ 0 |
Investment balance in Aero Engines | 23,900 |
Additional interest in Joint venture | 1,000 |
Company's portion of income generated by Aero Engines | $ 600 |
Quarterly Financial Data (Una_3
Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | Jan. 22, 2019 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Quarterly Financial Data (Unaudited) | ||||||||||||
Operating revenues | $ 743,591 | $ 760,295 | $ 744,383 | $ 723,694 | $ 783,400 | $ 805,515 | $ 829,275 | $ 803,489 | $ 2,971,963 | $ 3,221,679 | $ 3,122,592 | |
Operating income | 125,305 | 146,441 | 144,093 | 96,419 | 88,175 | 126,678 | 137,925 | 121,502 | 512,258 | 474,280 | 388,199 | |
Net income | $ 72,527 | $ 91,339 | $ 88,052 | $ 88,181 | $ 54,362 | $ 75,859 | $ 83,046 | $ 67,105 | $ 340,099 | $ 280,372 | $ 428,907 | |
Net income per common share: | ||||||||||||
Basic (in dollars per share) | $ 1.44 | $ 1.80 | $ 1.72 | $ 1.71 | $ 1.05 | $ 1.46 | $ 1.60 | $ 1.30 | $ 6.68 | $ 5.40 | $ 8.28 | |
Diluted (in dollars per share) | $ 1.43 | $ 1.79 | $ 1.71 | $ 1.69 | $ 1.03 | $ 1.43 | $ 1.57 | $ 1.28 | $ 6.62 | $ 5.30 | $ 8.08 | |
Weighted average common shares: | ||||||||||||
Basic (in shares) | 50,395,000 | 50,746,000 | 51,145,000 | 51,440,000 | 51,921,000 | 52,046,000 | 52,039,000 | 51,650,000 | 50,932,000 | 51,914,000 | 51,804,000 | |
Diluted (in shares) | 50,796,000 | 51,129,000 | 51,477,000 | 52,098,000 | 53,033,000 | 52,913,000 | 52,981,000 | 52,556,000 | 51,375,000 | 52,871,000 | 53,100,000 | |
Gain on sale of subsidiary | $ 46,500 | $ 46,500 | $ 46,525 | |||||||||
Special items | $ 21,900 | $ 21,869 |
SCHEDULE II -VALUATION AND QUAL
SCHEDULE II -VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
VALUATION AND QUALIFYING ACCOUNTS | |||
Balance at Beginning of Year | $ 22,299 | $ 17,255 | $ 40,670 |
Additions Charged to Costs and Expenses | 5,044 | ||
Deductions | (6,391) | (23,415) | |
Balance at End of Year | 15,908 | 22,299 | 17,255 |
Allowance for inventory obsolescence | |||
VALUATION AND QUALIFYING ACCOUNTS | |||
Balance at Beginning of Year | 22,141 | 17,098 | 40,497 |
Additions Charged to Costs and Expenses | 5,043 | ||
Deductions | (6,251) | (23,399) | |
Balance at End of Year | 15,890 | 22,141 | 17,098 |
Allowance for doubtful accounts receivable | |||
VALUATION AND QUALIFYING ACCOUNTS | |||
Balance at Beginning of Year | 158 | 157 | 173 |
Additions Charged to Costs and Expenses | 1 | ||
Deductions | (140) | (16) | |
Balance at End of Year | $ 18 | $ 158 | $ 157 |