SKYWEST,INC. (NASDAQ:SKYW) Files An 8-K Material Impairments
Item 2.06 Material Impairments.

On December 13, 2016, SkyWest, Inc. (“SkyWest”) announced additional fleet transitions and contract updates designed to reduce SkyWest’s long-term fleet risk and enhance its ability to respond to changing partner needs. Specifically, SkyWest’s ExpressJet operation expects to transition to flying primarily dual-class aircraft in its CRJ operation by removing its CRJ200 aircraft from service over the next year.

The removal of the CRJ200 aircraft reduces ExpressJet’s future required investment in its 50-seat fleet and is expected to improve the airline’s operating efficiency by eliminating an aircraft type from its platform. SkyWest also announced that ExpressJet and American Airlines have agreed to place 12 dual-class CRJ700s into service under a multi-year term. These CRJ700s had been scheduled to be removed from service under a previously-disclosed early lease return arrangement.

Additionally, SkyWest and Bombardier entered into a termination agreement covering Bombardier’s residual value guarantee (“RVG”) agreements on 76 CRJ200 aircraft owned by SkyWest Airlines and ExpressJet. Bombardier agreed to pay SkyWest $90 million by January 2017 along with certain other consideration in exchange for the release. Both the required sale of each aircraft and the cost to SkyWest of returning the aircraft to mid-time condition were points of risk and uncertainty for SkyWest that this termination agreement eliminates.

As a result of the expectation to remove ExpressJet CRJ200s from service and the Bombardier RVG termination agreement, SkyWest is evaluating its total 50-seat CRJ200 fleet and related long-lived assets for impairment in Q4 2016. SkyWest currently anticipates it will record a non-cash impairment charge in Q4 2016 estimated to be in the range of $440 million to $490 million (pre-tax) on its CRJ200 aircraft and other 50-seat aircraft assets, net of the $90 million in cash proceeds from the Bombardier termination agreement.

Item 7.01 Regulation FD Disclosure.

On December 13, 2016, SkyWest issued a press release announcing the additional fleet transitions, Bombardier agreement and anticipated 50-seat aircraft non-cash impairment charge.  The full text of SkyWest’s press release is furnished herewith as Exhibit 99.1.

The information in this Item 7.01 (including the exhibit) is furnished to General Instruction B.2. of Form 8-K and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing made by SkyWest under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

The following is furnished as an exhibit to this report:

Exhibit 99.1 Press release dated December 13, 2016.

About SKYWEST, INC. (NASDAQ:SKYW)

Skywest, Inc. is a holding company for approximately two scheduled passenger airline operations and an aircraft leasing company. The Company operates through two segments: SkyWest Airlines and ExpressJet. SkyWest Airlines provides regional jet and turboprop service to airports located in the Midwestern and Western United States. ExpressJet provides regional jet service in the Eastern United States, from airports located in Atlanta, Cleveland, Chicago (O’Hare), Houston, Detroit, Memphis, Newark and Minneapolis, as well as Mexico and Canada. The Company, through its subsidiaries, SkyWest Airlines, Inc. (SkyWest Airlines) and ExpressJet Airlines, Inc. (ExpressJet), offers scheduled passenger service with approximately 3,400 daily departures to destinations in the United States, Canada, Mexico and the Caribbean. Its consolidated fleet consists of a total of approximately 700 aircrafts, including over 360 United fleet, over 230 Delta fleet, over 50 American fleet and over 10 Alaska fleet.

SKYWEST, INC. (NASDAQ:SKYW) Recent Trading Information

SKYWEST, INC. (NASDAQ:SKYW) closed its last trading session up +0.25 at 36.55 with 353,034 shares trading hands.