This article from NYTimes.com has been sent to you by psa188@juno.com. ExpressJet Shares Plunge on Deferral February 13, 2003 By REUTERS Filed at 12:41 p.m. ET CHICAGO (Reuters) - Shares of regional air carrier ExpressJet Holdings Inc. (XJT.N) plummeted 26 percent on Thursday in their biggest one-day percentage loss ever after the airline said it would slow the delivery of 60 regional jets. The stock, the biggest percentage loser on the New York Stock Exchange on Thursday, plunged after the carrier said late Wednesday it was rescheduling the delivery of 60 of its 78 remaining firm orders from Brazil's Embraer (EMBR4.SA) (ERJ.N). Airlines have been postponing aircraft deliveries since the Sept. 11 attacks because there is not enough demand to fill planes. Houston-based ExpressJet, which went public last April, sells all of its capacity to Continental Airlines (CAL.N) and operates as Continental Express, which flies 196 regional jets. Jim Higgins, analyst at Credit Suisse First Boston, said the news was further evidence of the imbalance between the industry's supply and demand and was particularly worrisome because it involved small aircraft that were to be added at relatively low costs. ``We have long worried about the saturation in regional jet capacity past 2004 for a number of carriers,'' Higgins said in a research note. ``ExpressJet's slowing of deliveries, the reason for which appears to be a hard look at the economics of regional jets in a revenue environment that has probably changed forever, does nothing to diminish that concern.'' The regional carrier said the move would hurt its 2003 earnings per share by 2 cents to 4 cents. ExpressJet also said it now expects 2004 earnings per share to be off by 16 cents to 18 cents vs. estimates under its previous fleet plan. Another analyst said the stock decline was exacerbated by the negative tone permeating the industry. ``How many other airlines are even making any money in this environment?'' said Tony Cristello, analyst at BB&T Capital Markets. ``The company is still going to have some pretty good earnings growth. It also creates greater visibility because now we see deliveries into 2005 and 2006. So I don't necessarily think it's such a bad thing.'' Still, Cristello lowered his 2003 earnings estimate for ExpressJet to $1.48 per share from a previous forecast of $1.50. For 2004, Cristello revised his earnings forecast to $1.58 per share from a previous estimate of $1.74 a share. Analysts had expected ExpressJet to earn $1.51 a share for 2003 and $1.72 a share for 2004, according to Thomson First Call. Embraer will now deliver 36 of the ERJ-145XR 50-seat jets to ExpressJet instead of 48 in 2003, and will deliver 21 planes instead of 36 in 2004. In 2005, however, Embraer will deliver 21 jets instead of two and it will deliver another eight planes to ExpressJet in 2006. ExpressJet said Continental proposed changes as the airline struggles match capacity with demand. In exchange, Continental extended ExpressJet's guarantee as the exclusive provider of regional jet service in its hubs by one year, to Jan. 1, 2007. Embraer, the world's fourth-largest builder of commercial aircraft, trimmed its delivery goals as a result of the new agreement. Embraer shares fell 12 percent on the news. ExpressJet shares were down 26 percent or $2.99 at $8.53 on the New York Stock Exchange on Thursday afternoon. Continental shares were down 6.6 percent on the New York Stock Exchange. http://www.nytimes.com/reuters/business/business-airlines-expressjet.html?ex=1046162954&ei=1&en=adde56a12fa2ee8c HOW TO ADVERTISE --------------------------------- For information on advertising in e-mail newsletters or other creative advertising opportunities with The New York Times on the Web, please contact onlinesales@nytimes.com or visit our online media kit at http://www.nytimes.com/adinfo For general information about NYTimes.com, write to help@nytimes.com. Copyright 2002 The New York Times Company