Segment Reporting

6 Months Ended

Jun. 30, 2017

Segment Reporting

Segment Reporting

Note 5 - Segment Reporting

The Company’s three reporting segments consist of the operations of SkyWest Airlines, ExpressJet and SkyWest Leasing activities. Corporate overhead expenses incurred by the Company are allocated to the operating expenses of SkyWest Airlines and ExpressJet.

The Company’s chief operating decision maker analyzes the profitability of operating the E175 aircraft (including operating costs and associated revenue) separately from the profitability of the Company’s ownership, financing costs and associated revenue of the Company’s E175 aircraft (including depreciation expense, interest expense and associated revenue). The SkyWest Leasing segment includes revenue attributed to the Company’s E175 aircraft ownership cost earned under the applicable fixed-fee contracts and the depreciation and interest expense of the Company’s E175 aircraft. The SkyWest Leasing segment’s total assets and capital expenditures include the acquired E175 aircraft. The SkyWest Leasing segment additionally includes the ownership and activity of four CRJ200 aircraft leased to a third party.

The following represents the Company’s segment data for the three-month periods ended June 30, 2017 and 2016 (in thousands):

	Three months ended  June 30, 2017
	SkyWest				SkyWest
	Airlines		ExpressJet		Leasing		Consolidated
Operating revenues	$	537,749	$	212,025	$	59,985	$	809,759
Operating expense		460,641		215,070		27,452		703,163
Depreciation and amortization expense		32,530		11,710		26,966		71,206
Interest expense		5,735		1,088		20,240		27,063
Segment profit (loss) (1)		71,373		(4,133)		12,293		79,533
Identifiable intangible assets, other than goodwill		—		7,124		—		7,124
Total assets (as of June 30, 2017)		2,251,331		529,175		2,580,107		5,360,613
Capital expenditures (including non-cash)		25,346		4,501		265,955		295,802

	Three months ended  June 30, 2016
	SkyWest				SkyWest
	Airlines		ExpressJet		Leasing		Consolidated
Operating revenues	$	504,107	$	266,241	$	30,990	$	801,338
Operating expense		428,142		274,856		14,203		717,201
Depreciation and amortization expense		34,585		21,460		13,842		69,887
Interest expense		6,754		1,617		9,916		18,287
Segment profit (loss) (1)		69,211		(10,232)		6,871		65,850
Identifiable intangible assets, other than goodwill		—		9,374		—		9,374
Total assets (as of June 30, 2016)		2,074,265		1,389,687		1,418,099		4,882,051
Capital expenditures (including non-cash)		7,927		2,002		212,745		222,674

(1) Segment profit (loss) is equal to operating income less interest expense

The following represents the Company’s segment data for the six-month periods ended June 30, 2017 and 2016 (in thousands):

	Six months ended June 30, 2017
	SkyWest				SkyWest
	Airlines		ExpressJet		Leasing		Consolidated
Operating revenues	$	1,020,703	$	440,683	$	113,788	$	1,575,174
Operating expense		896,010		444,563		51,711		1,392,284
Depreciation and amortization expense		64,347		26,235		50,738		141,320
Interest expense		11,535		2,202		37,875		51,612
Segment profit (loss) (1)		113,158		(6,082)		24,202		131,278
Identifiable intangible assets, other than goodwill		—		7,124		—		7,124
Total assets (as of June 30, 2017)		2,251,331		529,175		2,580,107		5,360,613
Capital expenditures (including non-cash)		58,777		10,155		449,969		518,901

	Six months ended June 30, 2016
	SkyWest				SkyWest
	Airlines		ExpressJet		Leasing		Consolidated
Operating revenues	$	970,403	$	534,048	$	58,963	$	1,563,414
Operating expense		842,226		548,475		26,767		1,417,468
Depreciation and amortization expense		68,916		42,727		26,045		137,688
Interest expense		13,413		3,740		18,859		36,012
Segment profit (loss) (1)		114,764		(18,167)		13,337		109,934
Identifiable intangible assets, other than goodwill		—		9,374		—		9,374
Total assets (as of June 30, 2016)		2,074,265		1,389,687		1,418,099		4,882,051
Capital expenditures (including non-cash)		21,885		7,050		293,025		321,960