Republic Airways expects better results at Frontier
* Second-quarter earnings 40 cents/share
* Shares up 5 pct
Aug 1 (Reuters) - Republic Airways Holdings said it expects the restructuring of its Frontier unit to pay off in improved results for the current third quarter, and its shares were up 5 percent in afternoon trading.
The company said during a conference call on Wednesday that it expected total revenue per available seat mile to rise about 5 to 7 percent at Frontier in the third quarter. Operating margin at Frontier should be 7 to 9 percent, compared with a flat margin in the year-earlier third period.
"We do have an optimistic view that we're going to see further gains achieved as of the continued network restructuring that's ongoing at Frontier," Republic Airways Chief Executive Bryan Bedford said. He said the company was also revamping its small regional jet operations.
Indiana-based Republic, which also owns regional carriers Chautauqua Airlines and Republic Airlines, said it expects consolidated earnings of 45 cents to 55 cents a share for the third quarter. Analysts currently expect profit of 46 cents a share, according to Thomson Reuters I/B/E/S.
Lower operating expenses and Frontier improvement helped produce higher-than-expected second quarter results, which Republic Airways announced after markets closed on Tuesday.
Net income for that period was $20 million, or 40 cents a diluted share, compared with a year-earlier loss of $14.9 million, or 31 cents a share. Analysts expected profit of 25 cents a share.
Revenue fell 1.6 percent to $728.1 million in the second quarter. Fuel expenses fell nearly 16 percent in the period.
Republic Airways shares were up 5.1 percent to $4.78 in afternoon trading.
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