Alaska Air analysis

Alaska Air analysis - Alaska Air Group is a holding...

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Alaska Air Group is a holding company. The company's two principal subsidiaries include: Alaska Airlines (Alaska) and Horizon Air Industries (Horizon). Both subsidiaries operate as airlines. The company primarily operates in the US, Canada and Mexico. It is headquartered in Seattle, Washington and employs about 12,000 people. Alaska Air Group has witnessed a strong consistent revenue growth for the last ten years. The company’s revenue grew at a growth rate of over 10% from $ 2,975 million in 2005 to $ 3832.3 million in 2010, reflecting consistent growth in passenger traffic. The company recorded revenues of $3,823 million during the fiscal year ended December 2010, an increase of 13% over 2009. The increase in revenues was mainly due to rise in fares and higher passenger traffic. The operating profit of the company was $492 million, while the net profit was $248 million in 2009. The company’s ROIC has been higher than the industry ROIC for the past three years and competitive advantages triggered the outcome. One of the competitive advantages of Alaska Air Group is its ability to add capacity at negligible marginal cost. During 2010, the increase in revenue was driven almost entirely by an increase in capacity and an increase in ticket yields. The increase in capacity was primarily the result of having a larger aircraft fleet. In 2005 Alaska Airlines
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Alaska Air analysis - Alaska Air Group is a holding...

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