Pinnacle Posts $36 million Net Income Turnaround

Despite the fact that operating income was down from the year-ago period, Pinnacle Airlines managed a dramatic turnaround in net income to $15.8 million compared to a loss of $21.3 million in the third quarter of 2005. The airline slashed costs and improved operating margins to 10.6 percent, despite the six percent decline in revenues. The airline attributed the results to a significant decrease in operating expenses from 253 million in the 2005 quarter to $183 million during the 2006 quarter. The airline is currently in negotiations with its partner Northwest for a new Airline Services Agreement (ASA), but it said it expects the new ASA will significantly reduce revenues as well as certain expenses. Pinnacle, however, has to hammer out a labor contract with pilots if it is to continue as a Northwest Airlink.