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Chief Executive Officer's Comments
Frontier President and CEO Jeff Potter said, "In a quarter that has seen very few airlines report profitable results, we are very pleased to report our third consecutive profitable quarter. While the industry revenue and fare environment continues to be challenging, we were able to produce an industry leading year-over-year total revenue per available seat mile (RASM) improvement of 14.2 percent. This tremendous achievement was accomplished primarily through the increased customer acceptance of our product, leading to a 13 point year-over-year load factor improvement for the quarter to 72.5 percent despite adding significant year-over-year capacity to our system. The culmination of these achievements not only allowed us to report a profit for the quarter, but also led us to achieve one of the industry's highest operating margins for the quarter at 7.7 percent. As they always have, our employees met the challenges of record system-wide load factors during the peak holiday seasons, with the continued friendly and professional approach that our company has become known for.

"During the quarter, we also achieved several significant milestones that will become the foundation for our future growth. Specifically, we reached a long-awaited agreement with the City and County of Denver and Denver International Airport for the gate space we need to accommodate our hub expansion plans and we also announced our first focus city with point-to-point flights from Los Angeles International Airport to three destinations."

Operating Highlights
Total revenues for Frontier's fiscal third quarter of 2004 increased 36 percent to $163.6 million from $120.3 million in the fiscal third quarter of 2003, while operating expenses during the quarter increased 19.5 percent to $151.0 million from $126.4 million for the same quarter last year.

Passenger revenue increased as revenue passenger miles (RPMs) grew at a rate of 45.3 percent during the fiscal third quarter, far out-pacing capacity growth as measured by available seat miles (ASMs), which increased 19.1 percent from the same time last year. As a result, the airline's load factor was 72.5 percent for its fiscal third quarter of 2004, 13 load factor points greater than the airline's load factor of 59.5 percent during the same quarter last year. The airline's breakeven load factor for the fiscal third quarter 2004 increased 4.1 load factor points from 64.4 percent to 68.5 percent, which excludes the effect of one special item. This item accounted for .5 load factor points of the breakeven load factor increase.

During fiscal third quarter 2004, the airline's RASM increased 1.02 cents or 13.3 percent to 8.71 cents from 7.69 cents for the same quarter last year. The increase in RASM was due to the significant increase in load factor, which more than offset a decrease in revenue per passenger mile (yield) of 7.1 percent to 12.01 cents from 12.93 cents for the same period last year.

The year-over-year increase in total revenues includes contributions from other revenue sources associated with Frontier's U.S. mail contracts, LiveTV revenues and the positive contribution from Frontier's JetExpress service.

The airline's cost per available seat mile (CASM) for the fiscal third quarter increased slightly to 8.31 cents from 8.29 cents for the same quarter last year. Fuel cost per gallon during the quarter, including taxes and delivery charges, increased 7.3 percent to $1.03, compared to .96 cents for the same period last year. CASM excluding fuel decreased 0.9 percent to 6.80 cents from the same period last year, when CASM excluding fuel was 6.86 cents.

Senior Vice President and Chief Financial Officer Paul Tate discussed the airline's year-over-year unit cost comparatives stating, "While our CASM excluding fuel was slightly lower during the quarter on a year-over-year basis, our unit cost results were adversely affected primarily by an increase in passenger related expenses caused by a disproportionate increase in the number of passengers carried compared to the year-over-year quarterly ASM growth. In addition, our CASM increased year-over-year from the effects of the profit sharing accrual associated with our return to profitability and an increase in health insurance costs. We also incurred approximately $2 million of costs associated with the return of five Boeing aircraft to their lessors and accelerated Airbus pilot transitional training costs."

Tate also described the airline's current cash and working capital position stating, "As of December 31, 2003, and on a year-over-year basis, our cash position has increased from $31.5 million to $186.3 million. In the same period, our working capital has increased from $.2 million to $103.9 million. Our cash position remains near its all-time high despite prepaying the remaining $11.6 million of the government-guaranteed loan in December 2003."

The airline's fleet in service on December 31, 2003 consisted of 13 owned Airbus A319 and A318 aircraft, 14 leased Airbus A319 aircraft and 12 leased Boeing 737 aircraft.

Business developments during the quarter included:

• Resolved gate expansion concerns with the City and County of Denver and DIA, securing two to six mainline gates and four to five regional gates, pending final approval of the expansion plan.
• Announced plans for a new "focus" city in Los Angeles, with Frontier's first non-stop, point-to-point flights outside of the Denver hub. Service will include two daily non-stops from Los Angeles to Minneapolis/St. Paul, St. Louis, and Kansas City and will begin April 11, 2004.
• Announced plans to expand Denver service to include non-stop flights to Dulles International Airport in Washington, D.C. on April 11, 2004 and Anchorage International Airport in Anchorage, Alaska on May 9, 2004.
• Received permission to begin a third daily flight to slot-controlled La Guardia Airport (LGA).
• Filed for permission to add up to two more daily flights into slot and perimeter controlled Reagan National Airport (DCA).
• Became the first, and currently only airline to pay back the government guaranteed ATSB loan.
• Launched a new Frontier JetExpress regional jet relationship with Horizon Air on Jan. 1, 2004, replacing Mesa Air Group.
• Initiated service to Puerto Vallarta and Cabo San Lucas, Frontier's third and fourth Mexican destinations.
• Began service to Lambert-St. Louis International Airport.
• Signed sponsorship agreements with Kroenke Sports for the Colorado Avalanche, Denver Nuggets, and the Pepsi Center, as well as with all of the major universities in Colorado including Colorado State University, University of Colorado, University of Northern Colorado, University of Denver, and Air Force Academy.
• Became the first airline to implement the use of pediatric pads with the Automated External Defibrillator (AED).
• Earned Flag Carrier status, an FAA designation that allows Frontier to fly between two international destinations, as well as to Alaska and Hawaii, and beyond its previous limit of two hours from the U.S. border.
• Launched the successful "Quick Ascent" program, which allows elite members in other airlines' frequent flyer programs to join Frontier's EarlyReturns program as an elite member without the standard 15,000-mile requirement. To date, over 4,000 participants have become EarlyReturns members as a result of this program.
• Joined Operation Hero Miles, the innovative program that helps troops on emergency leave or Rest and Relaxation (R & R) from Iraq and Afghanistan, to fly home for free through the generous donations of miles from members of airlines' frequent flyer programs. Frontier Airlines donated 1.5 million miles to kick off its participation in the program.

Cash Comparisons
Cash, cash equivalents and short-term investments available for operations and investing activities on December 31, 2003 were $186.3 million compared to $31.5 million available on December 31, 2002. The increase in the Company's cash position is largely attributable to its net income for the period and was substantially aided by our secondary offering of 5.05 million shares of common stock in September 2003. A portion of the proceeds from the secondary offering were used to pre-pay $48.6 million of our government guaranteed loan. The increase in our cash position also enabled us to subsequently pay-off the remaining balance of $11.6 million in December 2003 The airline reported working capital of $103.9 million as of December 31, 2003, a substantial increase over the airline's working capital on December 31, 2002, when the airline reported working capital of $.2 million.

Potter concluded, "The third quarter was a challenging one for the airline industry as a whole, as many were looking to this quarter as evidence that air travel had either returned, or that summer loads were merely a result of seasonal travel. Given our traditional seasonality pattern, the December quarter was a very strong quarter with several days of record loads and great strides made with our operating margin.. For Frontier, this quarter we demonstrated that we have become a true carrier of choice, and that consumers are responding to the product that we are offering. In upcoming quarters, we'll focus on continuing to enhance our product, delivering on our promise to be "a whole different animal" and expanding our footprint with new and differentiated service, including our new Los Angeles point-to-point flights, and additional frequencies to our most popular destinations."

Senior leadership will host a conference call to discuss Frontier's quarterly earnings on January 30, 2004 at 9:00 a.m. Mountain Standard Time. The call is available via the World Wide Web on the airline's Web site at www.frontierairlines.com or using the following URL: http://www.vcall.com/CEPage.asp?ID=85575.

Currently in its tenth year of operations, Denver-based Frontier Airlines is the second largest jet service carrier at Denver International Airport with a fleet of 39 aircraft and employing approximately 3,900 aviation professionals. Frontier, in conjunction with Frontier JetExpress operated by Horizon Air, operates routes linking our Denver hub to 37 cities in 22 states spanning the nation from coast-to-coast and to four cities in Mexico. Frontier's maintenance and engineering department has received the Federal Aviation Administration's highest award, the Diamond Certificate of Excellence, in recognition of 100 percent of its maintenance and engineering employees completing advanced aircraft maintenance training programs, for four consecutive years. In August 2003, Frontier ranked as one of the "Top 10 Domestic Airlines" as determined by readers of Travel + Leisure magazine. Frontier provides capacity information and other operating statistics on its Web site, which may be viewed at www.frontierairlines.com.

Legal Notice Regarding Forward-Looking Statements
Statements contained in this press release that are not historical facts may be considered forward-looking statements as that item is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Some of the factors that could significantly impact the forward-looking statements in this press release include, but are not limited to: further downward pressure on airfares due to competition, demand or other factors; unanticipated decreases in the volume of passenger traffic due to terrorist acts or additional incidents that could cause the public to question the safety and/or efficiency of air travel; negative public perceptions associated with increased security wait times at various domestic airports; the inability to secure adequate gate facilities at Denver International Airport and at other airports where Frontier operates; weather, maintenance or other operational disruptions; air traffic control-related difficulties; the impact of labor issues; actions of the federal and local governments; changes in the government's policy regarding relief to the airline industry especially as it relates to war status risk insurance; and the stability of the U.S. economy and the economic environment of the airline industry. The Company undertakes no obligation to publicly update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this press release. Additional information regarding these and other factors may be contained in the Company's SEC filings, including without limitation, the Company's Form 10-K for its fiscal year ended March 31, 2003, the Company's Form 10-Q for the quarter ended June 30, 2003 and the Company's form 8-K filed September 19, 2003.

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