The company reported a net profit of $24.1 million, or 67 cents a share, in the fourth quarter of 2009. This contrasts favorably with the company's fourth-quarter 2008 numbers, when it suffered a loss of $75.2 million, or $2.08 a share.

"We're making strides despite weak demand and volatile oil prices," Bill Ayer, Alaska Air Group's chairman and chief executive officer, said in a telephone press conference.

The company's total net income for 2009 skyrocketed to $126 million, or $3.36 per share last year. Its net income for 2008 was a loss of $135.9 million, or $3.74 a share.

"Our traffic and unit revenue performance, driven by positive network changes, outpaced the industry throughout the year. This performance, combined with lower fuel costs, placed Alaska Air Group's profitability among the best in the industry for 2009," Ayer said in a media release. "This marks our sixth consecutive year of profits on an adjusted basis."

Falling demand required a reduction and redeployment of resources last year, and as the company scaled back its expenditures, it was able to conform to demand and increase profits, Ayer said.

"Conservative financial management has served us well," Ayer said.

Of all the actions taken by the airline to reduce expenditures and increase profit, employee furloughs were the toughest, especially in the current economic times, Ayer said.

The airline's small size served to strengthen the company, Ayer said, as it enabled the company to move quickly, work more closely with customers and inspire a greater sense of personal accountability among employees.

Ayer said the company would keep a closer eye on merchandizing fares in the coming year, and would look to broaden employee involvement in marketing.

The company plans to donate $76 million from its pay-for-performance incentive plans based on its 2009 profit and operational performance. Since employee performance has a strong impact on the success of the company, and more money can be donated to employees' pension plans when the company is more profitable, employees have a greater incentive to perform well in their tasks, Ayer said.

Following the announcement of the donation to employees' pension plans, the Air Line Pilots Association, which represents nearly 52,350 pilots at 37 airlines in the U.S. and Canada, issued a press release thanking the company for its contribution.

"We recognize Alaska Airlines for demonstrating their commitment to responsibly funding our pension plan and continuing to live up to the promise they have made to this pilot group with respect to our retirement benefits," Sid Graham, chairman of the Retirement and Insurance Committee for the Alaska Airlines Master Executive Council of the Association, said in the media release.

Alaska Air Group's two subsidiaries, Alaska Airlines and Horizon Air, serve more than 90 cities through a network in Alaska, the Lower 48, Hawaii, Canada and Mexico.

Sean Manget can be reached at

sean.manget@alaskajournal.com.