Analysis of Jet Blue Airline company's Balance sheet - Research Paper Example

Analysis of Jet Blue Airline Companys Balance Sheet This report analyses the balance sheet of the Jet Blue Airline for the year 2009, 2010 and 2011 and explores the reasons for the changes in the balance sheet figures.Considering the assets side of the balance sheet of the Jet Blue Airlines (See Appendix 1), the total assets of the company increased slightly in the year 2010 as compared to 2009, i.e. increased by $ 44 million. However, the total assets increased considerably in the year 2011 as compared to the figures in 2010, i.e. $ 6,593 million in 2010 to $ 7,071 million in the year 2011.

This significant increase took place due to significant increase in the current assets of the company, particularly in the cash reserves, receivables and short-term investment securities of the company. In 2010, this trend was converse to what can be seen in 2011; the company’s current assets declined significantly in 2010 ($ 1,360 million) as compared to the level in the year 2009 ($ 1,534 million). Considering this increase in the current assets of the company, it can be argued that the company is making efforts to bring the current assets level back to what has been maintained in the year 2009.

On the other hand, the property and equipment section of the total assets also signified a comparatively larger increase in the year 2011 as compared to the previous years, i.e. the property and equipment increased from $ 4,641 million in 2010 to $ 4,860 million in the year 2011. This increase is attributed to the purchase of new flight equipment by the Jet Blue Airline in 2011 and other equipment. This trend can be seen to be followed from the year 2010 in which the company also purchased the flight equipment, but the increase was not as significant as it has been in the year 2011 (Jet Blue Airline).

On the other hand, the equity side of the balance sheet for the three years under consideration shows fewer changes in the year 2010 as compared to the financial year 2009 but there is a significant increase in the total liabilities and equity of the company in the year 2011. The overall increase in the equity and liabilities section of the company is $ 44 million in 2010. The long term liabilities of the company declined from $ 2,920 million in 2009 to $ 2,850 million in 2010. On the other hand, almost every item in current liabilities section showed increase in 2010 apart from the current maturities section, which declined considerably, i.e. $ 384 million in 2009 to $ 183 million in 2010.

On the other side, the equity section of the balance sheet showed an increase primarily due to increase in the paid up capital in 2010. Keeping in view the liabilities and equity section of the balance sheet for the financial year 2011, the company showed an overall significant increase in both liabilities and equity. Particularly, the current liabilities of the company climbed up by a significant amount in the financial year 2011 due to rise in every item which comes under the current liabilities; moreover, the company also obtained short term borrowings in 2011.

In the long term liabilities section, the only significant fluctuation seen is the increase in the deferred tax amount, i.e. from $ 327 million in 2010 to $ 392 million in 2011. On the equity side, there is a significant rise in the retained earnings of the company in the year 2011, i.e. from $ 219 million in 2010 to $ 305 million in 2011 (Jet Blue Airline).From this analysis, it can be concluded that the overall balance sheet footing of the company remained stable from 2009 to 2010 but increased significantly in 2011.

Works CitedJet Blue Airline. "Annual Report Form 10 K." Financial Statements. 2011.—. "Annual Report Form 10 K." Financial Statements. 2010.Appendix – 0130-Dec-1130-Dec-1030-Dec-09AssetsCurrent Assets Cash And Cash Equivalents673,000  468,000  909,000   Short Term Investments553,000  495,000  240,000   Net Receivables200,000  173,000  155,000   Inventory50,000  49,000  40,000   Other Current Assets152,000  175,000  190,000   Total Current Assets1,628,000 1,360,000  1,534,000  Long Term Investments38,000  133,000  6,000  Property Plant and Equipment4,860,000  4,641,000  4,638,000  Goodwill-  -  -  Intangible Assets-  -  -  Accumulated Amortization-  -  -  Other Assets545,000  459,000  371,000  Deferred Long Term Asset Charges-  -  -   Total Assets7,071,000  6,593,000  6,549,000  LiabilitiesCurrent Liabilities Accounts Payable499,000  396,000  330,000   Short/Current Long Term Debt286,000  183,000  384,000   Other Current Liabilities627,000  514,000  443,000   Total Current Liabilities1,412,000  1,093,000  1,157,000  Long Term Debt2,850,000  2,850,000  2,920,000  Other Liabilities660,000  669,000  667,000  Deferred Long Term Liability Charges392,000  327,000  259,000  Minority Interest-  -  -  Negative Goodwill-  -  -   Total Liabilities5,314,000  4,939,000  5,003,000  Stockholders EquityMisc Stocks Options Warrants-  -  -  Redeemable Preferred Stock-  -  -  Preferred Stock-  -  -  Common Stock3,000  3,000  3,000  Retained Earnings305,000  219,000  122,000  Treasury Stock-8,000-4,000-2,000Capital Surplus1,472,000  1,446,000  1,422,000  Other Stockholder Equity-15,000-10,0001,000   Total Stockholder Equity1,757,000  1,654,000  1,546,000   Net Tangible Assets1,757,000  1,654,000  1,546,000