(RTTNews) - Alaska Air Group, Inc. (ALK: News ), on Thursday, posted a net profit for the third quarter, compared to a loss last year, helped by lower expenses mainly on lower fuel costs, as well as mark-to-market fuel hedge gains, nothwithstanding a drop in revenues. Earnings came in well ahead of Street estimates, while revenues fell short of expectations.

For the third quarter, the Seattle, Washington-based company posted net income of $87.6 million or $2.46 per share, compared to a net loss of $86.5 million or $2.40 per share in the prior-year quarter.

Results for the third quarter include mark-to-market fuel hedge gains of $4.6 million or $0.13 per share.

Excluding one-time items, net income for the quarter increased to $83.0 million or $2.33 per share from $39.9 million or $1.10 per share last year.

On average, nine analysts polled by Thomson Reuters expected the company to earn $2.26 per share for the quarter. Analysts' estimate typically excludes one-time charges and gains.

Quarterly revenues decreased to $967.4 million from $1.07 billion in the prior-year quarter. Analysts expected the company to report revenue of $971.52 million for the quarter.

Operating income for the quarter was $159.8 million, compared to operating loss of $120.0 million in the year-earlier period. Total operating expenses for the quarter decreased significantly to $807.6 million from $1.19 billion last year. Aircraft fuel, including hedging gains and losses for the quarter were $199.5 million, compared to $575 million in the year-ago quarter.
Alaska subsidiary Alaska Airlines' operating income for the third quarter was $136.7 million, compared to operating loss of $98.2 million in the year-ago period. Total operating revenues declined 8.8% to $858.8 million from $941.9 million in the same quarter last year.

Alaska Airlines' mainline passenger traffic for the third quarter edged up 0.2.%, while capacity declined 3.3%. Load factor increased 2.8 percentage points to 82.3%.

Horizon Air Industries Inc. operating income for the third quarter was $23.7 million, compared to operating loss of $21.6 million in the corresponding period last year. Quarterly operating revenues decreased 12.7% to $178.2 million from $204.1 million last year.

Horizon Air's passenger traffic for the quarter declined 7.6% on a 9.5% capacity decrease. Load factor increased by 1.6 percentage points to 77.9% from last year.

For the nine-month period, the company's net income was $97.5 million or $2.69 per share, compared to a net loss of $60.7 million or $1.67 per share last year. Excluding items, net income was $84.1 million or $2.32 per share, compared to a net loss of $12.0 million or $0.33 per share in the same period last year.

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