Airtran — Investor Presentation (May 2010)
26 slides from Airtran's investor presentation, May 13, 2010
Slide 1: May 2010 Investor Update
May 2010 Investor Update May 2010 Investor Update
Slide 2: Safe Harbor
2 Safe Harbor Certain of the statements contained herein should be considered “forward-looking statements,” including within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by words such as “may”, “will”, “expect,” “intend,” “in
Slide 3: AirTran Investment Highlights
3 AirTran Investment Highlights n Industry leading low costs and high quality n Conservative fleet plan and disciplined growth n Strong ancillary revenues ― Less dependent on initial sale to passenger n Better diversified network ― More than 700 daily departures to over 70 destinations ― Fewer price
Slide 4: On Every AirTran Flight…
4 On Every AirTran Flight… n Youngest, all-Boeing fleet in North America n Business Class n Assigned seating n Wi-Fi n Over 100 channels of free XM Satellite Radio n Oversized luggage bins n Friendly Crew Members n Broad distribution network
Slide 5: AirTran's Cost Advantage Remains Strong
5 AirTran’s Cost Advantage Remains Strong (Cents) Note: Excludes fuel and special items Industry Cost Comparison Non-Fuel Unit Costs at 738 Miles for 2009 49% Higher 5% Higher
Slide 6: AirTran Has High Quality & Industry Leading Low Costs
AirTran AirTran AirTran AirTran 6 2008 2007 2006 2009 2010 AirTran AirTran Has High Quality & Industry Leading Low Costs JetBlue Independence Southwest United America West Northwest Continental Alaska American JetBlue Northwest Alaska Southwest Frontier Continental American US Airways United JetBlue
Slide 7: Current Fleet Plan Allows for Disciplined Growth
7 Current Fleet Plan Allows for Disciplined Growth 28% 24% 20% 5% (2)% 3-4% 3-4% 5-7% (Aircraft) n Currently 138 aircraft: 86 717s / 52 737-700s ASM Growth
Slide 8: AirTran Has Successfully Diversified Its Network
8 AirTran Has Successfully Diversified Its Network % ASMs 2000 2002 2004 2006 2008 2010E Atlanta 91% 76% 67% 64% 58% 47% Florida 29% 35% 34% 38% 45% 41% Baltimore 0% 13% 13% 9% 11% 13% Milwaukee 0% 3% 3% 2% 7% 13% Caribbean 0% 1% 1% 0% 3% 6% Daily Flights 278 362 492 650 713 713 Note: Totals >100% a
Slide 9: AirTran's 2010 Network Nationwide and Diversified
9 AirTran’s 2010 Network Nationwide and Diversified Portland Dallas/Ft. Worth Las Vegas Minneapolis San Antonio Flint San Juan Montego Bay Aruba Rochester San Diego Los Angeles Seattle San Francisco Wichita New Orleans Cancun Knoxville Lexington Buffalo Boston Allentown Akron/ Canton Jacksonville Or
Slide 10: AirTran's 2010 Atlanta Network
10 AirTran’s 2010 Atlanta Network Has Grown to 60 Cities Boston Dallas/Ft. Worth Las Vegas Denver Minneapolis San Antonio Houston San Juan Cancun Montego Bay Aruba Newport News Rochester Kansas City Columbus Akron/ Canton San Diego Los Angeles Phoenix Seattle San Francisco Milwaukee Moline Chicago G
Slide 11: AirTran Now Serves the Most Destinations from Orlando
11 AirTran Now Serves the Most Destinations from Orlando Portland Dallas/Ft. Worth Las Vegas Minneapolis San Antonio Houston San Juan Montego Bay Aruba Rochester San Diego Los Angeles Seattle San Francisco Wichita New Orleans Cancun White Plains New York (LGA) Philadelphia Atlantic City Washington,
Slide 12: AirTran Capitalized on Baltimore's Capacity Reductions
12 AirTran Capitalized on Baltimore’s Capacity Reductions Portland Dallas/Ft. Worth Las Vegas Minneapolis San Antonio San Juan Montego Bay Aruba Rochester San Diego Los Angeles Seattle San Francisco Branson Wichita New Orleans Cancun White Plains New York (LGA) Philadelphia Atlantic City Newport New
Slide 13: AirTran is Now Milwaukee's Largest Mainline Carrier
13 AirTran is Now Milwaukee’s Largest Mainline Carrier Portland Dallas/Ft. Worth Las Vegas Minneapolis San Antonio Houston San Juan Montego Bay Aruba Rochester San Diego Los Angeles Seattle San Francisco Branson Wichita New Orleans Cancun White Plains New York (LGA) Philadelphia Atlantic City Washin
Slide 14: Future Growth Opportunities
14 Future Growth Opportunities n Milwaukee / Upper Midwest n Florida n Latin America n Baltimore n Atlanta
Slide 15: AirTran Yr/Yr Growth is Diversified Beyond Milwaukee
15 AirTran Yr/Yr Growth is Diversified Beyond Milwaukee (ASM Growth) AirTran 2010 Available Seat Mile Growth 3 - 4% ~1.0 % ~1.5% ~1.25% ~0.75% ~0.5% (~1.5%)
Slide 16: AirTran's Milwaukee Network Has Matured
16 AirTran’s Milwaukee Network Has Matured (ASMs in Millions) AirTran Milwaukee Daily ASMs (Passenger Market Share Shown Above) n AirTran now serves 18 of the top 20 markets 8% 9% 12% 16% 16% 19% 21% 26% 26% 30% 30% 30% 30% Source: www.apgdat.com Note: Estimated passenger market share for Q210 - Q41
Slide 17: Milwaukee is Larger than Most Mid-Sized Hub Cities
17 Milwaukee is Larger than Most Mid-Sized Hub Cities Mid-Sized Hub Cities Population within 60 Miles (Millions) Fortune 500 Companies Headquarters Detroit 6.4 18 Atlanta 4.6 10 Cleveland 3.9 11 Pittsburgh 3.7 7 Seattle 3.6 8 Milwaukee 3.4 7 Minneapolis 3.3 18 Phoenix 3.2 5 Cincinnati 3.1 8 Denver 2
Slide 18: Milwaukee Plays Big Role in Downsized Chicago Region
18 Milwaukee Plays Big Role in Downsized Chicago Region (Daily Seats 000s) Chicago / Milwaukee Region Capacity Milwaukee population: 3.4 million
Slide 19: Legacy Airline's Domestic Networks Remain Unprofitable
19 Legacy Airline’s Domestic Networks Remain Unprofitable (Billions) (Billions) Legacy Airline Domestic Net Income Source: DOT Form 41 Filings and company reported financials Annual Cumulative
Slide 20: Domestic Capacity at Lowest Level in Over a Decade
20 20 82% 79% 76% 72% 69% 64% 61% 59% 57% 56% 55% 6% 7% 8% 10% 12% 14% 14% 14% 14% 15% 16% 12% 14% 16% 18% 19% 22% 25% 27% 29% 29% 29% Domestic Capacity at Lowest Level in Over a Decade Source: www.apgdat.com (Billions) Continental U.S. Available Seat Miles Legacy Regional LCC (2%)
Slide 21: Industry Losses Result in Disciplined Domestic Capacity
21 Industry Losses Result in Disciplined Domestic Capacity AirTran Southwest Delta +5% +1% -13% Domestic Capacity 2010 vs. 2007 Northeast -9% Midwest -13% Southwest -9% Mountain -11% West -11% South -10% Domestic Capacity Change 2010 vs. 2007 Source: www.apgdat.com
Slide 22: Revenue Trends are Accelerating
22 Revenue Trends are Accelerating AirTran and ATA Industry Unit Revenue (Cents) (Cents) Q1 AirTran (PRASM/TRASM) ATA (PRASM) Q2 Note: Unit revenue adjusted to Q1 2010 passenger length of haul for both AirTran and ATA 1% ~8% AirTran (PRASM/TRASM) ATA (PRASM)
Slide 23: AirTran is Committed to Reducing Fuel Cost Volatility
23 23 Crude Price Period Hedge % $50 $70 $90 Q210 51% $67 $77 $84 Q310 70% $72 $78 $89 Q410 57% $65 $76 $88 2010 56% $72 $78 $84 2011 29% $68 $72 $90 AirTran is Committed to Reducing Fuel Cost Volatility n One of few airlines to actively hedge for 2010 n Comprised of calls and wide collars n Portfol
Slide 24: Q2 2010 Outlook is Positive
24 Q2 2010 Outlook is Positive n Capacity up approximately 4% n Estimated total unit revenue (TRASM) to be up 13% to 14% ― Revenue trends continue to accelerate in Q2 n Average economic cost per gallon of fuel all-in is $2.37 to $2.42 ― Approximately 60% hedged for second half 2010 n Non-fuel unit c
Slide 25: AirTran Investment Summary
25 AirTran Investment Summary n Track record of profitability was restored in 2009 ― Industry leading low costs and a high quality product drove record profitability across multiple market segments n Company has been successfully repositioned ― Disciplined fleet plan with multiple growth opportuniti
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