31 October, 2023

SkyWest orders 19 Embraer jets....

SkyWest orders 19 Embraer jets

Brazilian planemaker Embraer said last week its firm order backlog reached $17.8 billion at the end of the third quarter, including a newly announced order by SkyWest for 19 of its E175 jets.  Its backlog grew by $500 million from the previous quarter and Embraer delivered 43 aircraft in the third quarter, compared with 33 in the year-ago period, totalling 105 aircraft delivered year-to-date.

The planemaker confirmed that SkyWest had ordered 19 of its E175 jets for $1.1 billion, with deliveries expected to start in the final quarter of 2024. The new aircraft will be flown by United Airlines under a capacity purchase agreement, Embraer said.

In the third quarter of the year, SkyWest has reported a net income of $23 million, compared to net income of $48 million for the same period in 2022.  Revenue was $766 million in Q3 2023, down $23 million, or 3%, from $789 million in Q3 2022. 

SkyWest deferred recognizing $57 million of revenue during Q3 2023 compared to recognizing previously deferred revenue of $13 million during Q3 2022. The amount of revenue deferred during Q3 2023 was driven by modified terms relating to fixed monthly cash payments under SkyWest’s previously announced amended flying contracts.
Commenting on the results, Chip Childs, Chief Executive Officer of SkyWest, said, “Our teams continue to deliver an exceptional product and operating performance. We are pleased with the improving trajectory of our business, strong demand for our product, and steady progress toward stabilization of our pilot hiring and retention. I want to thank our amazing team for delivering outstanding operations in the third quarter.”

Operating expenses were $717 million in Q3 2023, up $3 million from $714 million in Q3 2022, driven by increases in employee compensation, including higher pilot pay scales. Higher labor 
costs were partially offset by lower aircraft rent expenses due to the early lease buyouts on 35 CRJ aircraft for the nine months ended September 30, 2023, and lower operating costs associated with a 10% reduction in Q3 2023 block hour production compared to Q3 2022. 

Extra reporting by Peter Frontini