INDIANAPOLIS, Feb 16, 2006 (BUSINESS WIRE) -- Republic Airways Holdings Inc. (NASDAQ:RJET) today reported operating revenues of $251.8 million for the quarter ended December 31, 2005, a 33.6% increase, compared to $188.5 million for the same period last year. The Company also reported net income of $18.5 million or $0.43 per diluted share, for the quarter ended December 31, 2005.

These results include a one-time, non-cash item. During the quarter the Company reversed an accrual for estimated return charges on turboprop aircraft leases of $2.5 million, net of tax, or $0.06 per diluted share, due to a settlement that was reached with the lessors.

Net of this adjustment, net income was $15.9 million or $0.37 per diluted share compared to $14.8 million of net income or $0.56 per diluted share for the same period last year. Weighted average diluted common shares outstanding increased from 26.2 million to 42.9 million, or 64.0% as a result of the Company's follow on offerings of common stock in February and July 2005.

The primary items of significance affecting the fourth quarter of 2005 are outlined below:

Total operating revenues for the fourth quarter of 2005 increased primarily as a result of a 46.2% increase in available seat miles (ASMs) to 1.85 billion ASMs, up from 1.27 billion ASMs, and a 17.2% increase in block hours. These increases reflect the addition of thirty-six 70-seat regional jet aircraft that were placed into service throughout the year and the reduction of seven 50-seat regional jet aircraft that were removed from fixed-fee operations between September and November 2005. Five aircraft were removed from US Airways and two were removed from United. Of these seven aircraft, five have been subleased off-shore and two have been placed into our charter operations.

Total operating expenses for the fourth quarter of 2005, including interest expense but excluding fuel charges (which are reimbursable by the Company's major partners) and the one-time, non-cash item, of $147.9 million, increased approximately 34.7% from $109.8 million for the same quarter of 2004. Operating cost per ASM (CASM), including interest expense but excluding fuel and the one-time, non-cash item, decreased to 7.97 cents, a 7.9% decrease compared to the prior year's 8.65 cents.

The company increased its operating fleet of aircraft to 142 (48 Delta, 40 US Airways, 35 United, 15 American, and four Charter) as of December 31, 2005, from 111 regional jet aircraft as of December 31, 2004. During the quarter, the Company took delivery of twelve 70-seat regional jet aircraft (seven from US Airways, three for United and two for Delta) and removed four 50-seat regional jet aircraft (two from US Airways and two from United).

At December 31, 2005, the Company had $162.0 million in cash and marketable securities compared to $46.2 million as of December 31, 2004. The Company entered into debt financing arrangements for the five new aircraft delivered from the factory during the quarter. The Company's long-term debt increased to $1.41 billion as of December 31, 2005, compared to $0.85 billion at December 31, 2004. The Company has significant long-term lease obligations that are classified as operating leases and are not reflected as liabilities on the Company's consolidated balance sheets. At a 7.0% discount factor, the present value of these lease obligations was approximately $591.8 million as of December 31, 2005.

The Company's total Debt (including off-balance sheet leases) to Capital ratio decreased from 7.9 to 1 in 2004 to 4.7 to 1 in 2005, reflecting the Company's issuance of common stock in February and July 2005 of approximately $187 million.

For the full year ended December 31, 2005, operating revenues increased 40.0% to $905.0 million, compared to $646.3 million for the same period last year. The Company also reported net income of $60.7 million for 2005, or $1.66 per diluted share.

Net of the one-time, non-cash adjustment, net income improved 49.4% to $58.1 million, or $1.59 per diluted share compared to $38.9 million, or $1.62 per diluted share, in 2004. Weighted average diluted common shares outstanding increased from 23.9 million to 36.6 million, or 52.9% as a result of the Company's follow on offerings of common stock in February and July 2005.

Total ASMs for 2005 increased 42.1% from 2004 to 6.6 billion and block hours for 2005 increased 23.8% from 2004 to 464,000. During the year, the Company placed into service thirty-six 70-seat regional jet aircraft and removed seven 50-seat regional jets from fixed-fee service. The Company's average stage length increased 10.9% from 439 in 2004 to 487 in 2005, reflecting the longer flight segments being flown by the 70-seat aircraft.

Corporate Information

Republic Airways Holdings, based in Indianapolis, Indiana is an airline holding company that operates Chautauqua Airlines, Republic Airlines and Shuttle America. The company offers scheduled passenger service on approximately 800 flights daily to 78 cities in 33 states, Canada and the Bahamas through airline services agreements with four major U.S. airlines. All of its scheduled flights are operated under its major airline partner brand, such as AmericanConnection, Delta Connection, United Express and US Airways Express. The airline currently employs approximately 3,100 aviation professionals and operates 145 regional jet aircraft including 50 E170 aircraft.

The Company will conduct a telephone briefing to discuss its fourth quarter results today at 11:00 a.m. EDT. A live Webcast of this briefing will be available online at www.rjet.com - investor relations.

Additional Information

In addition to historical information, this release contains forward-looking statements. Republic Airways may, from time-to-time, make written or oral forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements encompass Republic Airways' beliefs, expectations, hopes or intentions regarding future events. Words such as "expects," "intends," "believes," "anticipates," "should," "likely" and similar expressions identify forward-looking statements. All forward-looking statements included in this release are made as of the date hereof and are based on information available to Republic Airways as of such date. Republic Airways assumes no obligation to update any forward-looking statement. Actual results may vary, and may vary materially, from those anticipated, estimated, projected or expected for a number of reasons, including, among others, the risk factors disclosed in the Company's most recent filing with the Securities and Exchange Commission.

REPUBLIC AIRWAYS HOLDINGS INC.
                  CONSOLIDATED STATEMENTS OF INCOME
     (Dollars and Shares in Thousands, Except per Share Amounts)
                             (Unaudited)

                                 Three Months Ended     Year Ended
                                     December 31       December 31
                                   2005     2004      2005     2004
OPERATING REVENUES
   Passenger                     $240,504 $186,037  $883,906 $636,389
   Other                           11,272    2,483    21,115    9,935
        Total operating revenues  251,776  188,520   905,021  646,324

OPERATING EXPENSES
   Wages and benefits              38,344   29,494   143,826  112,305
   Aircraft fuel (see note below)  79,383   56,981   278,923  174,208
   Landing fees                     7,415    6,613    30,376   24,201
   Aircraft and engine rent        20,217   20,413    77,725   74,514
   Maintenance and repair          19,901   17,188    76,481   70,290
   Insurance and taxes              3,638    3,116    16,117   13,186
   Depreciation and amortization   20,933   10,641    64,877   34,412
   Impairment loss and accrued
    aircraft return costs          (4,218)       0    (4,218)   1,441
   Other                           16,378   12,801    62,195   50,422
        Total operating expenses  201,991  157,247   746,302  554,979
OPERATING INCOME                   49,785   31,273   158,719   91,345

OTHER INCOME (EXPENSE)
   Interest expense               (21,037)  (9,489)  (63,546) (28,464)
   Other income                     1,818      227     5,002      518
        Total other income
         (expense)                (19,219)  (9,262)  (58,544) (27,946)

INCOME BEFORE INCOME TAXES         30,566   22,011   100,175   63,399

INCOME TAX EXPENSE                 12,103    7,245    39,521   24,547

NET INCOME                         18,463   14,766    60,654   38,852

PER SHARE, BASIC                    $0.44    $0.58     $1.69    $1.66
PER SHARE, DILUTED                  $0.43    $0.56     $1.66    $1.62
Weighted Average Common Shares
   Basic                           41,696   25,543    35,854   23,350
   Diluted                         42,916   26,165    36,548   23,907




                    Unaudited Operating Highlights

Operating         Three Months Ended               Year Ended
 Highlights           December 31                 December 31
                2005      2004    Change    2005      2004     Change
Passengers
 carried      2,368,044 1,970,902   20.2% 9,137,132 6,842,407    33.5%
Revenue
 passenger
 miles (000)  1,272,631   868,357   46.6% 4,516,518 3,062,940    47.5%
Available seat
 miles (000)  1,854,656 1,268,434   46.2% 6,559,966 4,618,043    42.1%
Passenger load
 factor            68.6%     68.5% 0.1 pts     68.8%     66.3% 2.5 pts
Cost per
 available
 seat mile,
 including
 interest
 expense
 (cents)          12.03     13.14  (8.4%)     12.35     12.63   (2.3%)
Fuel cost per
 available
 seat mile
 (cents) (see
 note below)       4.28      4.49  (4.7%)      4.25      3.77    12.7%
Impairment
 cost (credit)
 per available
 seat mile
 (cents)          (0.22)     0.00     NM      (0.06)     0.03 (300.0%)
Cost per
 available
 seat mile,
 excluding
 fuel expense
 and
 impairment
 costs (cents)     7.97      8.65  (7.9%)      8.16      8.83   (7.6%)
Block hours     118,980   101,533   17.2%   464,041   374,749    23.8%
Departures       67,371    63,428    6.2%   274,765   236,798    16.0%
Average daily
 utilization
 of each
 aircraft
 (hours)          10.28     10.35  (0.6%)     10.50     10.27     2.2%
Average
 aircraft
 stage length       533       435   22.5%       487       440    10.7%

Note: Beginning in May 2005, US Airways elected to provide fuel directly for all of the Company's US Airways Express aircraft operations. This change eliminates fuel expense and the related fuel reimbursement (previously recorded as revenue) for the US Airways operations. Operating profits are not affected by this change.

SOURCE: Republic Airways Holdings

Republic Airways Holdings
Warren R. Wilkinson, 317-484-6042