Frontier Airlines Holdings, Inc. reported a consolidated net profit of $2.9 million in its Monthly Operating Report for November when it also reported an operating profit of $2.5 million for the month. Included in Frontier's operating profit were non-cash mark-to-market losses on fuel hedge contracts of $2.0 million.
The airline also announced it reached a tentative agreement with the Frontier Airline Pilots Association will go before union membership for a ratification vote. If the agreement is approved by membership, Frontier will have secured concessions from all of its represented employees - a critical milestone in the company's ongoing restructuring efforts, said the airline.
"We understand the challenges Frontier faces right now and our membership has worked to support Frontier through the entire process," said FAPA President John Stemmler. "This tentative agreement minimizes the damage to our contract, preserves our company's collaborative culture, and will give Frontier its best chance to survive in the near term and flourish in the long term."
The company’s financial results also included a loss of $2.4 million in cash settlements from fuel hedging contracts and a book gain of $4.0 million on the sale of two A319 aircraft sold in the month included in reorganizational items, offset by other reorganizational expenses of $1.2 million. Its cash position increased to $53.4 million for November 2008. The company realized net proceeds of $15.9 million from the sale of two aircraft which was offset by a $9.7 million net increase in holdbacks from the company's credit card processors and $1.8 million of additional net deposits in collateral posted to fuel hedge counterparties.
November's cash balance does not include the proceeds from two aircraft sales that Frontier completed in December 2008.
"We are now seeing the changes we have made in our company over the last year start to pay dividends," said Frontier President and CEO Sean Menke. "We are successfully controlling our costs, increasing revenue and managing our cash. We feel very comfortable with our restructuring efforts moving ahead and look forward to more positive results in the future."
Companies in Chapter 11 Bankruptcy protection are required to file monthly operating reports to the U.S. Trustee in addition to quarterly reports filed with the U.S. Securities and Exchange Commission.