OPERATING SEGMENT INFORMATION

6 Months Ended

Jun. 30, 2011

OPERATING SEGMENT INFORMATION [Abstract]

Operating Segment Information

OPERATING SEGMENT INFORMATION

Effective January 1, 2011, Horizon's business model changed such that 100% of its capacity is sold to Alaska under a capacity purchase agreement (CPA). As is typical for similar arrangements, certain costs such as landing fees and aircraft rents, selling and distribution costs, and fuel costs directly related to regional flights operated by Horizon are now recorded by Alaska. Also, based on the terms of the new agreement, Horizon's revenues and Alaska's regional revenues have changed significantly on a year over year basis. All inter-company revenues and expenses are eliminated in consolidation, and these changes have no impact on the consolidated results.

Operating segment information for Alaska and Horizon for the three and six months ended June 30 were as follows (in millions):

	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
Operating revenues:
Alaska—mainline passenger(a)	$	819.9		$	702.3		$	1,522.3		$	1,289.3
Alaska—regional passenger(a)	194.3			82.6			370.8			158.7
Total Alaska passenger revenues	$	1,014.2		$	784.9		$	1,893.1		$	1,448.0
Alaska—other revenues	94.1			87.6			178.0			162.1
Total Alaska operating revenues	$	1,108.3		$	872.5		$	2,071.1		$	1,610.1
Horizon—brand flying(b)	—			100.9			—			190.2
Horizon—CPA	93.5			67.4			188.1			133.8
Horizon—other revenues	1.9			2.8			4.3			5.5
Total Horizon operating revenues	$	95.4		$	171.1		$	192.4		$	329.5
Elimination of inter-company revenues	(93.5		)	(67.4		)	(188.1		)	(133.8		)
Consolidated operating revenues	$	1,110.2		$	976.2		$	2,075.4		$	1,805.8
Operating expenses:
Alaska—mainline, excluding fuel	$	498.4		$	476.4		$	996.1		$	941.7
Alaska—mainline fuel	356.1			214.5			512.5			386.2
Alaska—regional	179.5			74.3			350.5			146.8
Total Alaska operating expenses	$	1,034.0		$	765.2		$	1,859.1		$	1,474.7
Horizon(c)	110.6			167.5			210.9			327.5
Other(d)	1.3			1.2			1.9			2.0
Elimination of inter-company expenses	(93.5		)	(67.4		)	(188.1		)	(133.8		)
Consolidated operating expenses	$	1,052.4		$	866.5		$	1,883.8		$	1,670.4
Nonoperating expenses:
Alaska	$	(6.9	)	$	(10.8	)	$	(15.8	)	$	(21.7	)
Horizon(c)	(4.2		)	(4.8		)	(8.1		)	(9.4		)
Other(d)	0.3			(0.1		)	—			(0.1		)
Consolidated nonoperating expenses	$	(10.8	)	$	(15.7	)	$	(23.9	)	$	(31.2	)
Income (loss) before income tax:
Alaska—mainline	$	51.8		$	87.6		$	173.9		$	100.9
Alaska—regional	15.6			8.9			22.3			12.8
Total Alaska	$	67.4		$	96.5		$	196.2		$	113.7
Horizon(c)	(19.4		)	(1.2		)	(26.6		)	(7.4		)
Other(d)	(1.0		)	(1.3		)	(1.9		)	(2.1		)
Consolidated income before income tax	$	47.0		$	94.0		$	167.7		$	104.2

	June 30, 2011			December 31, 2010
Total assets at end of period:
Alaska	$	4,888.3		$	4,610.2
Horizon	816.2			747.2
Other(d)	1,509.5			1,375.6
Elimination of inter-company accounts	(1,980.2		)	(1,716.4		)
Consolidated	$	5,233.8		$	5,016.6

^(a)    Alaska mainline passenger revenue represents revenue from passengers aboard Alaska jets. Alaska regional passenger revenue represents revenue earned by Alaska on capacity provided by Horizon, SkyWest Airlines and another small third-party carrier in the state of Alaska under capacity purchase arrangements.

^(b)    As 100% of Horizon's capacity is sold to Alaska under the CPA, Horizon no longer has brand flying revenue.

^(c)    Includes special charges of $26.8 million and $36.9 million for the three and six months ended June 30, 2011 related to fleet transition charges at Horizon.

^(d)    Includes parent company results and its investments in Alaska and Horizon, which are eliminated in consolidation.