SkyWest Inc. (NASDAQ:SKYW) Q1 2019 Earnings Conference Call - Final Transcript
Apr 26, 2018 • 04:30 pm ET
some of our legacy contracts and financing of aircraft, which Rob and Wade will provide more color on in just a minute. This is a critical part of our evolution as we focus on reducing terrorist going to improving economics. From a big picture perspective, both within our organization across the industry, we continue to see solid opportunity and demand.
As we've discussed previously 2018 is another busy year in our fleet transition that's just set us up well for a very strong 2019 and beyond. We're looking ahead to a busy summer and remain focused on our discipline execution of our strategic business objectives. Again I want to thank our 17,000 aviation professionals for their outstanding work during the quarter. Rob?
Today, we reported net income of $54 million or $1.03 per share for the first quarter of 2018, up from net income of $35 million or $0.65 earnings per share from the first quarter of 2017. Pretax income of $67 million during Q1 was up 28% from $52 million in Q1 2017. Revenue was $783 million in Q1 2018, up $36 million from Q1 2017. This increase in revenue included the net impact of adding 19 new E175 aircraft since Q1 2017, partially offset by the removal of 71 unprofitable or less-profitable aircraft over the same period, including 46 50-seat aircraft.
Our total fuel cost per gallon averaged $2.40 during the first quarter, up from $2.01 per gallon in Q1 2017. The line item in our P&L for aircraft fuel was $9 million higher pretax than a year ago, reflecting both the higher rate and higher volume under our prorate business model. Just a reminder that over 90% of our model is not subject to fuel risk. Similar to Q1 last year, where we had a tax provision about 4 points lower than the annual rate, because of new accounting rules around equity compensation this quarter is 19% effective tax rate was also several points lower than what we would expect for the rest of the year.
The lower provision in Q1 was primarily driven both last year and this year by the fact that we had certain equity grants invest during the first quarter. We would expect this pattern and trend to continue as our board typically only issues new grants once a year during the first quarter. The timing and amount of future related tax impact on our provision will vary based on restricted share vesting, stock price performance, stock option exercises and other factors. We continue to expect our tax rate to be approximately 25% for the remaining three quarters of the year. The full year should still be in the 24% to 25% neighborhood as we estimated last quarter. This quarter we recorded a net gain of $3 million in other income that was a mark-to-market gain on an investment net of other items.
Let me say a couple of things about our balance sheet, an important point of differentiation in our model. We