SEATTLE -- Alaska Air Group Inc.'s fourth-quarter net income dipped, to below analyst expectations, as fuel costs soared 31 percent.
The company, which operates Alaska Airlines and Horizon Air, paid $3.34 per gallon for fuel in the quarter, up from $2.56 a year earlier.
Alaska Air said Thursday that net income was $64 million, or $1.76 per share, down 1 percent from $64.8 million, or $1.75 per share, a year earlier.
Excluding gains from fuel-hedging contracts to offset rising fuel prices, the company said it would have earned $1.02 per share. Analysts, who usually exclude one-time items, expected $1.15 per share, according to FactSet.
Revenue rose 9 percent, to $1.04 billion, just below analysts' forecast of $1.05 billion.
Fuel costs rose even with hedging gains, to $285.6 million from $217.7 million.
The company reported a 6.1 percent increase in passenger traffic, measured in miles flown by paying customers. Passengers paid on average 3.3 percent more per mile, but that didn't cover the fuel increase.
Despite slightly higher ticket prices, planes were more full. Average occupancy was 84.7 percent, compared with 82.9 percent a year earlier.
For the full year, Alaska Air posted net income of $244.5 million, or $6.66 per share, compared with $251.1 million, or $6.83 per share, in 2010.
Shares fell $1.14, or 1.5 percent, to $74.30 in morning trading.