(MENAFNEditorial) ST. GEORGE, Utah, Feb. 1, 2018 /PRNewswire/ -- SkyWest, Inc. (NASDAQ: ) ("SkyWest") today reported financial and operating results for Q4 2017, including net income of $290 million, or $5.46 per diluted share, compared to net loss of $270 million, or $5.22 loss per diluted share for Q4 2016. Excluding special items in both periods, adjusted net income was $43 million, or $0.81 per diluted share for Q4 2017, compared to adjusted net income of $29 million, or $0.54 per diluted share for Q4 2016.1 Q4 2017 adjusted earnings per diluted share of $0.81 did not include a $247 million after-tax benefit from the revaluation of our net deferred tax liability that was included in our GAAP results for the quarter.
SkyWest reported net income of $429 million, or $8.08 per diluted share for the 2017 year, compared to a net loss of $162 million, or $3.14 loss per diluted share for the 2016 year. Excluding special items in both periods, adjusted net income was $182 million, or $3.43 per diluted share for the 2017 year, compared to adjusted net income of $143 million, or $2.73 per diluted share for the 2016 year.2
The improvement in net income from Q4 2016 to Q4 2017, excluding special items, was primarily due to SkyWest's continued fleet transition over the last year, including the addition of 21 new E175 aircraft and the removal of aircraft operating under unprofitable or less profitable flying agreements, including 65 50-seat jet aircraft and 13 CRJ700/CRJ900 aircraft.
Commenting on the results, Chip Childs, Chief Executive Officer of SkyWest, said, "Our 2017 results reflect solid execution of our plan by our world-class professionals. Healthy year-over-year improvements came from disciplined investment, risk reduction and strong operating performance. Our execution of these clear objectives continues to drive results and positive momentum into 2018 and beyond."
Q4 2017 Financial Highlights
Revenue was $797 million in Q4 2017, up from $758 million in Q4 2016. The increase in revenue included the net impact of adding 21 new E175 aircraft since Q4 2016, partially offset by the removal of 78 unprofitable or less profitable aircraft over the same period. Additionally, SkyWest took delivery of 19 E175 aircraft throughout Q4 2016, which had only a partial quarter impact on 2016 revenue for comparability purposes to 2017.
Operating expenses were $704 million in Q4 2017, down from $1.16 billion in Q4 2016. The Q4 2016 operating expenses included $473 million in special charges related to our 50-seat fleet and early lease returns.3 Excluding the Q4 2016 special charges, the Q4 2017 operating expenses were up $14 million from Q4 2016 primarily due to higher fuel costs and an increase in engine maintenance costs as an increasing percentage of our fleet are under long term power-by-the-hour maintenance agreements.
The enactment of the TCJA resulted in $247 million income tax benefit from the revaluation of SkyWest's net deferred tax liabilities during Q4 2017. SkyWest anticipates an effective tax rate for 2018 to generally range between 24% and 25%, excluding the impact of any discrete tax items.
Q4 2017 Operational Update
SkyWest Airlines, Inc. ("SkyWest Airlines") took delivery of three new E175 aircraft during the quarter. The following summarizes the anticipated delivery dates for the remaining 12 E175 aircraft to be placed under contract with Alaska Airlines ("Alaska") and 30 E175 SC aircraft to be placed under contract with Delta Air Lines ("Delta"):
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