SKYWEST INC Debt Disclosure
(3) Long-term Debt
Long-term debt consisted of the following as of December 31, 2024 and 2023 (in thousands):
| December 31, |
| December 31, |
| |||
2024 | 2023 |
| |||||
Notes payable to banks, due in quarterly installments, plus interest at 2.33% to 5.95% through 2036, secured by aircraft | $ | 2,055,330 | $ | 2,302,578 | |||
Notes payable to banks, due in monthly or semi-annual installments, plus interest at 2.90% to 5.94% through 2032, secured by aircraft and engines |
| 436,649 |
| 527,092 | |||
Notes payable to U.S. Government, interest due semi-annually at 1.00% through 2025 and based on SOFR plus 2.0% from 2025 through 2031, unsecured |
| 200,640 |
| 200,640 | |||
Long-term debt | 2,692,619 | 3,030,310 | |||||
Current portion of long-term debt |
| (539,061) |
| (447,534) | |||
Less long-term portion of unamortized debt issue cost, net | (16,772) | (20,593) | |||||
Long-term debt, net of current maturities and debt issue costs | $ | 2,136,786 | $ | 2,562,183 | |||
Current portion of long-term debt | $ | 539,061 | $ | 447,534 | |||
Less current portion of unamortized debt issue cost, net | (3,472) | (3,665) | |||||
Current portion of long-term debt, net of debt issue costs | $ | 535,589 | $ | 443,869 | |||
As of December 31, 2024 and 2023, the Company had $2.7 billion and $3.0 billion, respectively, of total long-term debt. The average effective interest rate on the Company’s debt was approximately 4.2% and 4.1% at December 31, 2024 and 2023, respectively.
During 2024, the Company took delivery of five new E175 aircraft that the Company financed through $116.2 million of long-term debt. The debt associated with the five E175 aircraft has terms, is due in quarterly installments, and is secured by the E175 aircraft.
The aggregate amounts of principal maturities of long-term debt as of December 31, 2024 were as follows (in thousands):
2025 |
| $ | 539,865 |
|
2026 |
| 517,924 | ||
2027 |
| 471,919 | ||
2028 |
| 300,945 | ||
2029 |
| 206,586 | ||
Thereafter |
| 655,380 | ||
$ | 2,692,619 |
As of December 31, 2024 and 2023, SkyWest Airlines had a $100.0 million line of credit. The line of credit includes minimum liquidity and profitability covenants and is secured by certain assets. As of December 31, 2024 and 2023, SkyWest Airlines had no amounts outstanding under the line of credit facility. However, at December 31, 2024 and 2023, the Company had $24.9 million and $29.2 million, respectively, in letters of credit issued under the facility which reduced the amount available under the facility to $75.1 million and $70.8 million, respectively. The line of credit expires March 25, 2028 and has a variable interest rate of 3.5% plus the one month SOFR rate.
As of December 31, 2024 and 2023, the Company had $47.1 million and $49.1 million, respectively, in letters of credit and surety bonds outstanding with various banks and surety institutions.
The Company’s debt agreements are not traded on an active market and are recorded at carrying value on the Company’s consolidated balance sheet. The fair value of the Company’s long-term debt is estimated based on current rates offered to the Company for similar debt. The fair value of debt is estimated using inputs classified as Level 2 within the fair value hierarchy. The carrying value and fair value of the Company’s long-term debt as of December 31, 2024 and 2023, were as follows (in thousands):
December 31, 2024 | December 31, 2023 | |||||
Carrying value | $ | 2,692,619 | $ | 3,030,310 | ||
Fair value | $ | 2,612,838 | $ | 2,918,012 | ||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2024 | Feb 13, 2025 | Showing above |
| 2023 | Feb 15, 2024 | |
| 2022 | Feb 16, 2023 | |
| 2021 | Feb 17, 2022 | |
| 2020 | Feb 22, 2021 | |
| 2019 | Feb 18, 2020 | |
| 2018 | Feb 21, 2019 | |
| 2017 | Feb 26, 2018 | |
| 2016 | Feb 27, 2017 | |
| 2015 | Feb 26, 2016 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.