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Hawaiian Holdings Reports 2019 Third Quarter Financial Results

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HONOLULU — Hawaiian Holdings, Inc. (NASDAQ: HA) (the “Company”), parent company of Hawaiian Airlines, Inc. (“Hawaiian”), today reported its financial results for the third quarter of 2019.

Third Quarter 2019 – Key Financial Metrics

 

 

GAAP

 

YoY Change

 

Adjusted

 

YoY Change

Net Income

 

$80.1M

 

($13.5M)

 

$81.5M

 

($15.2M)

Diluted EPS

 

$1.70

 

($0.14)

 

$1.72

 

($0.19)

Pre-tax Margin

 

14.4%

 

(1.0) pts.

 

14.6%

 

(1.3) pts.
 

“Our team did a fantastic job this quarter, demonstrating once again that Hawaiian Airlines is the carrier of choice for guests traveling to, from and within the Hawaiian Islands,” said Peter Ingram, Hawaiian Airlines president and CEO. “In the face of heightened competition, we delivered strong financial results and made significant progress towards accomplishing the strategic priorities that we established at the beginning of the year.  As we enter the home stretch of 2019, we look forward to continuing to execute our proven formula for generating value for our guests and our investors.  I extend my thanks, as always, to my 7,300 colleagues for their tireless efforts to deliver award-winning, authentic Hawaiian hospitality every day.”

Statistical information, as well as a reconciliation of the non-GAAP financial measures, can be found in the accompanying tables.

 

Shareholder Returns, Liquidity and Capital Resources

The Company returned $25.7 million to shareholders in the third quarter through share repurchases of $20.0 million and a dividend payment of $5.7 million.

On October 18, 2019, the Company's Board of Directors declared a quarterly cash dividend of 12 cents per share to be paid on November 29, 2019 to all shareholders of record as of November 15, 2019.

As of September 30, 2019, the Company had:

• Unrestricted cash, cash equivalents and short-term investments of $745 million

• Outstanding debt and finance lease obligations of $782 million

 

Third Quarter 2019 Highlights

Leadership and People

• Appointed Robin Kobayashi as interim Senior Vice President of Human Resources.

Operational

• Ranked #1 nationally for on-time performance year-to-date through August 2019, as reported in the U.S. Department of Transportation Air Travel Consumer Report, adding to its record of 15 consecutive years as the most punctual airline.

• Implemented Amadeus’ Departure Control Flight Management to optimize load planning and improve operational efficiency.

Products and Services

• In September and October, launched sales of Main Cabin Basic fares in all North American markets, enhancing Hawaiian's product portfolio with a fare option that appeals to the most price-conscious travelers.

Routes and Network

• Received final U.S. Department of Transportation approval to operate one additional daily nonstop flight between Tokyo Haneda Airport (HND) and Honolulu Daniel K. Inouye International Airport (HNL) starting in March of 2020.

• Announced service for three new routes with its A321neo fleet:

◦ Four-times-weekly service between Maui’s Kahului Airport (OGG) and Las Vegas’ McCarran International Airport (LAS) beginning December 15, 2019

◦ Thrice-weekly nonstop service between Honolulu (HNL) and Seattle-Tacoma International Airport (SEA) starting January 7, 2020, supplementing existing daily A330-200 service

◦ Seasonal winter service between Maui (OGG) and Los Angeles International Airport (LAX) from December 14, 2019 through January 5, 2020, supplementing existing daily A330-200 service

Fleet & Financing

•     Took delivery of two Airbus A321neo aircraft, increasing the size of its A321neo fleet to fifteen aircraft.

•     Entered into two Japanese Yen-denominated debt financings, collateralized by four Airbus A330 aircraft and two Airbus A321neo aircraft.

•     Extended the leases on three A330 aircraft, enabling cost savings while maintaining fleet flexibility for future growth.

Fourth Quarter and Full Year 2019 Outlook

The table below summarizes the Company’s expectations for the fourth quarter ending December 31, 2019, and the full year ending December 31, 2019, expressed as an expected percentage change compared to the results for the quarter and the full year ended December 31, 2018, as applicable.

 

 

Fourth Quarter

 

 

 

GAAP Fourth Quarter

Item

 

2019 Guidance

 

GAAP Equivalent

 

2019 Guidance

ASMs

 

Up 3.0 – 4.5%

 

 

 

 

Operating revenue per ASM

 

Down 0.5 – 3.5%

 

 

 

 

Cost per ASM excluding fuel and non-recurring items (a)

 

Up 0.5 – 3.5%

 

Cost per ASM (a)

 

Down 0.1 – 2.5%

Gallons of jet fuel consumed

 

Up 0.5 – 2.5%

 

 

 

 

Economic fuel cost per gallon (b)(c)

 

$2.02

 

Fuel cost per gallon (b)

 

$1.98

 

 

 

Full Year

 

 

 

GAAP Full Year

Item

 

2019 Guidance

 

GAAP Equivalent

 

2019 Guidance

ASMs

 

Up 1.9 – 2.4%

 

 

 

 

Cost per ASM excluding fuel and non-recurring items (a)

 

Up 1.8 – 2.6%

 

Cost per ASM (a)

 

Down 2.3 – 2.9%

Gallons of jet fuel consumed

 

Down 1.0 – 1.5%

 

 

 

 

Economic fuel cost per gallon (b)(c)

 

$2.05

 

Fuel cost per gallon (b)

 

$2.00
 

(a) See Table 4 for a reconciliation of GAAP operating expenses to operating expenses excluding aircraft fuel and non-recurring items.

(b) Fuel cost per gallon estimates are based on the October 10, 2019 fuel forward curve.

(c) See Table 3 for a reconciliation of GAAP fuel costs to economic fuel costs.

 

Investor Conference Call

Hawaiian Holdings’ quarterly earnings conference call is scheduled to begin today (October 22, 2019) at 4:30 p.m. Eastern Time (USA).  The conference call will be broadcast live over the Internet. Investors may access and listen to the live audio webcast on the investor relations section of the Company’s website at HawaiianAirlines.com. For those who are not available for the live webcast, a replay of the webcast will be archived for 90 days on the investor relations section of the Company's website.

 

About Hawaiian Airlines

Hawaiian® has led all U.S. carriers in on-time performance for each of the past 15 years (2004-2018) as reported by the U.S. Department of Transportation. Consumer surveys by Condé Nast Traveler, Travel + Leisure and TripAdvisor have placed Hawaiian among the top of all domestic airlines serving Hawai‘i.

Now in its 90th year of continuous service, Hawaiian is Hawai‘i’s biggest and longest-serving airline. Hawaiian offers non-stop service to Hawai‘i from more U.S. gateway cities (13) than any other airline, along with service from Japan, South Korea, Australia, New Zealand, American Samoa and Tahiti. Hawaiian also provides, on average, more than 170 jet flights daily between the Hawaiian Islands, with a total of more than 260 daily flights system-wide.

Hawaiian Airlines, Inc. is a subsidiary of Hawaiian Holdings, Inc. (NASDAQ: HA). Additional information is available at HawaiianAirlines.com. Follow Hawaiian's Twitter updates (@HawaiianAir), become a fan on Facebook (Hawaiian Airlines), and follow us on Instagram (hawaiianairlines). For career postings and updates, follow Hawaiian's LinkedIn page.

For media inquiries, please visit Hawaiian Airlines' online newsroom.

 

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect the Company’s current views with respect to certain current and future events and financial performance.  Such forward-looking statements include, without limitation, the Company’s expectations regarding available seat miles, cost per available seat mile, cost per available seat mile excluding fuel and non-recurring items, gallons of jet fuel consumed, fuel cost per gallon, and economic fuel cost per gallon for the quarter and full year ending December 31, 2019; the Company's expectations regarding operating revenue per available seat mile for the quarter ending December 31, 2019; and statements as to other matters that do not relate strictly to historical facts or statements of assumptions underlying any of the foregoing.  Words such as “expects,” “anticipates,” “projects,” “intends,” “plans,” “believes,” “estimates,” variations of such words, and similar expressions are also intended to identify such forward-looking statements.  These forward-looking statements are and will be subject to many risks, uncertainties and assumptions relating to the Company’s operations and business environment, all of which may cause the Company’s actual results to be materially different from any future results, expressed or implied, in these forward-looking statements.  These risks and uncertainties include, without limitation, the Company’s ability to accurately forecast quarterly and annual results; economic volatility; macroeconomic developments; political developments; the price and availability of aircraft fuel; fluctuations in demand for transportation in the markets in which the Company operates, including due to the occurrence of natural disasters such as hurricanes, earthquakes and tsunamis; the Company’s dependence on tourist travel; labor negotiations; regulatory determinations and related developments; competitive pressures, including the impact of rising industry capacity between North America and Hawai‘i and interisland; the Company's ability to continue to generate sufficient cash flow to support the payment of a quarterly dividend; changes in the Company's future capital needs; foreign currency exchange rate fluctuations; and the Company’s ability to implement its growth strategy.

The risks, uncertainties and assumptions referred to above that could cause the Company’s results to differ materially from the results expressed or implied by such forward-looking statements also include the risks, uncertainties and assumptions discussed from time to time in the Company’s other public filings and public announcements, including the Company’s Annual Report on Form 10-K and the Company’s Quarterly Reports on Form 10-Q, as well as other documents that may be filed by the Company from time to time with the Securities and Exchange Commission.  All forward-looking statements included in this document are based on information available to the Company on the date hereof.  The Company does not undertake to publicly update or revise any forward-looking statements to reflect events or circumstances that may arise after the date hereof even if experience or future changes make it clear that any projected results expressed or implied herein will not be realized.

 

Table 1.

Hawaiian Holdings, Inc.

Consolidated Statements of Operations (unaudited)

 

 

Three Months Ended September 30,

 

Nine Months Ended September 30,

 

 

2019

 

2018

 

% Change

 

2019

 

2018

 

% Change

 

 

(in thousands, except per share data)

Operating Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

Passenger

 

$

694,263

 

 

$

697,232

 

 

(0.4

)%

 

$

1,948,990

 

 

$

1,963,994

 

 

(0.8

)%

Other

 

60,888

 

 

61,855

 

 

(1.6

)%

 

175,101

 

 

175,952

 

 

(0.5

)%

Total

 

755,151

 

 

759,087

 

 

(0.5

)%

 

2,124,091

 

 

2,139,946

 

 

(0.7

)%

Operating Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Wages and benefits

 

182,862

 

 

176,642

 

 

3.5

%

 

537,997

 

 

516,906

 

 

4.1

%

Aircraft fuel, including taxes and delivery

 

138,586

 

 

162,932

 

 

(14.9

)%

 

405,290

 

 

449,404

 

 

(9.8

)%

Maintenance, materials and repairs

 

61,363

 

 

57,118

 

 

7.4

%

 

182,539

 

 

176,229

 

 

3.6

%

Aircraft and passenger servicing

 

41,762

 

 

42,063

 

 

(0.7

)%

 

120,303

 

 

117,207

 

 

2.6

%

Depreciation and amortization

 

41,596

 

 

36,373

 

 

14.4

%

 

119,274

 

 

101,537

 

 

17.5

%

Commissions and other selling

 

33,291

 

 

32,704

 

 

1.8

%

 

96,598

 

 

96,482

 

 

0.1

%

Aircraft rent

 

30,534

 

 

31,768

 

 

(3.9

)%

 

91,773

 

 

93,533

 

 

(1.9

)%

Other rentals and landing fees

 

33,345

 

 

33,227

 

 

0.4

%

 

95,777

 

 

95,226

 

 

0.6

%

Purchased services

 

33,120

 

 

32,509

 

 

1.9

%

 

98,306

 

 

95,104

 

 

3.4

%

Contract terminations expense

 

—

 

 

—

 

 

—

%

 

—

 

 

35,322

 

 

(100.0

)%

Other

 

42,056

 

 

37,925

 

 

10.9

%

 

118,041

 

 

117,977

 

 

0.1

%

Total

 

638,515

 

 

643,261

 

 

(0.7

)%

 

1,865,898

 

 

1,894,927

 

 

(1.5

)%

Operating Income

 

116,636

 

 

115,826

 

 

0.7

%

 

258,193

 

 

245,019

 

 

5.4

%

Nonoperating Income (Expense):

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense and amortization of debt discounts and issuance costs

 

(6,438

)

 

(8,446

)

 

 

 

(21,268

)

 

(24,628

)

 

 

Interest income

 

3,148

 

 

3,124

 

 

 

 

9,205

 

 

6,529

 

 

 

Capitalized interest

 

1,171

 

 

1,821

 

 

 

 

3,713

 

 

6,414

 

 

 

Gains (losses) on fuel derivatives

 

(4,553

)

 

3,495

 

 

 

 

(7,203

)

 

27,064

 

 

 

Other, net

 

(1,445

)

 

937

 

 

 

 

(5,553

)

 

(759

)

 

 

Total

 

(8,117

)

 

931

 

 

 

 

(21,106

)

 

14,620

 

 

 

Income Before Income Taxes

 

108,519

 

 

116,757

 

 

 

 

237,087

 

 

259,639

 

 

 

Income tax expense

 

28,443

 

 

23,215

 

 

 

 

62,820

 

 

58,075

 

 

 

Net Income

 

$

80,076

 

 

$

93,542

 

 

 

 

$

174,267

 

 

$

201,564

 

 

 

Net Income Per Common Stock Share:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

1.70

 

 

$

1.85

 

 

 

 

$

3.65

 

 

$

3.97

 

 

 

Diluted

 

$

1.70

 

 

$

1.84

 

 

 

 

$

3.64

 

 

$

3.96

 

 

 

Weighted Average Number of Common Stock Shares Outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

47,119

 

 

50,594

 

 

 

 

47,784

 

 

50,807

 

 

 

Diluted

 

47,236

 

 

50,731

 

 

 

 

47,847

 

 

50,935

 

 

 

 

Table 2.

Hawaiian Holdings, Inc.

Selected Statistical Data (unaudited)

 

 

 

Three months ended September 30,

 

Nine months ended September 30,

 

 

2019

 

2018

 

% Change

 

2019

 

2018

 

% Change

 

 

(in thousands, except as otherwise indicated)

Scheduled Operations (a) :

 

 

 

 

 

 

 

 

 

 

 

 

Revenue passengers flown

 

3,066

 

 

3,035

 

 

1.0

%

 

8,843

 

 

8,943

 

 

(1.1

)%

Revenue passenger miles (RPM)

 

4,673,734

 

 

4,554,393

 

 

2.6

%

 

13,288,823

 

 

12,918,174

 

 

2.9

%

Available seat miles (ASM)

 

5,321,812

 

 

5,347,156

 

 

(0.5

)%

 

15,325,559

 

 

15,098,431

 

 

1.5

%

Passenger revenue per RPM (Yield)

 

14.85

¢

 

15.31

¢

 

(3.0

)%

 

14.67

¢

 

15.20

¢

 

(3.5

)%

Passenger load factor (RPM/ASM)

 

87.8

%

 

85.2

%

 

2.6

pt.

 

86.7

%

 

85.6

%

 

1.1

pt.

Passenger revenue per ASM (PRASM)

 

13.05

¢

 

13.04

¢

 

0.1

%

 

12.72

¢

 

13.01

¢

 

(2.2

)%

Total Operations (a) :

 

 

 

 

 

 

 

 

 

 

 

 

Revenue passengers flown

 

3,072

 

 

3,039

 

 

1.1

%

 

8,853

 

 

8,949

 

 

(1.1

)%

Revenue passenger miles (RPM)

 

4,679,632

 

 

4,557,706

 

 

2.7

%

 

13,300,090

 

 

12,921,666

 

 

2.9

%

Available seat miles (ASM)

 

5,331,914

 

 

5,352,976

 

 

(0.4

)%

 

15,341,510

 

 

15,104,500

 

 

1.6

%

Operating revenue per ASM (RASM)

 

14.16

¢

 

14.18

¢

 

(0.1

)%

 

13.85

¢

 

14.17

¢

 

(2.3

)%

Operating cost per ASM (CASM)

 

11.98

¢

 

12.02

¢

 

(0.3

)%

 

12.16

¢

 

12.55

¢

 

(3.1

)%

CASM excluding aircraft fuel and non-recurring items (b)

 

9.38

¢

 

8.94

¢

 

4.9

%

 

9.53

¢

 

9.32

¢

 

2.3

%

Aircraft fuel expense per ASM (c)

 

2.60

¢

 

3.05

¢

 

(14.8

)%

 

2.64

¢

 

2.98

¢

 

(11.4

)%

Revenue block hours operated

 

56,088

 

 

55,147

 

 

1.7

%

 

162,556

 

 

155,369

 

 

4.6

%

Gallons of jet fuel consumed

 

69,749

 

 

72,133

 

 

(3.3

)%

 

201,547

 

 

206,032

 

 

(2.2

)%

Average cost per gallon of jet fuel (actual) (c)

 

$

1.99

 

 

$

2.26

 

 

(11.9

)%

 

$

2.01

 

 

$

2.18

 

 

(7.8

)%

Economic fuel cost per gallon (c)(d)

 

$

2.04

 

 

$

2.15

 

 

(5.1

)%

 

$

2.06

 

 

$

2.06

 

 

—

%

 

(a)     Includes the operations of the Company's contract carrier under a capacity purchase agreement.

(b)     See Table 4 for a reconciliation of GAAP operating expenses to operating expenses excluding aircraft fuel and non-recurring items.

(c)     Includes applicable taxes and fees.

(d)     See Table 3 for a reconciliation of GAAP fuel costs to economic fuel costs.

 

Table 3.

Hawaiian Holdings, Inc.

Economic Fuel Expense (unaudited)

The Company believes that economic fuel expense is a good measure of the effect of fuel prices on its business as it most closely approximates the net cash outflow associated with the purchase of fuel for its operations in a period. The Company defines economic fuel expense as GAAP fuel expense plus losses/(gains) realized through actual cash (receipts)/payments received from or paid to hedge counterparties for fuel hedge derivative contracts settled during the period.

 

 

Three months ended September 30,

 

Nine months ended September 30,

 

 

2019

 

2018

 

% Change

 

2019

 

2018

 

% Change

 

 

(in thousands, except per-gallon amounts)

Aircraft fuel expense, including taxes and delivery

 

$

138,586

 

 

$

162,932

 

 

(14.9

)%

 

$

405,290

 

 

$

449,404

 

 

(9.8

)%

Realized losses (gains) on settlement of fuel derivative contracts

 

3,399

 

 

(8,085

)

 

NM

 

9,294

 

 

(24,572

)

 

NM

Economic fuel expense

 

$

141,985

 

 

$

154,847

 

 

(8.3

)%

 

$

414,584

 

 

$

424,832

 

 

(2.4

)%

Fuel gallons consumed

 

69,749

 

 

72,133

 

 

(3.3

)%

 

201,547

 

 

206,032

 

 

(2.2

)%

Economic fuel costs per gallon

 

$

2.04

 

 

$

2.15

 

 

(5.1

)%

 

$

2.06

 

 

$

2.06

 

 

—

%

 

 

 

Estimated three months ending

December 31, 2019

 

 Estimated full year ending

December 31, 2019

 

 

(in thousands, except per-gallon amounts)

Aircraft fuel expense, including taxes and delivery

 

$

134,541

 

to

$

137,278

 

 

$

539,836

 

to

$

542,642

 

Realized losses (gains) on settlement of fuel derivative contracts

 

3,000

 

to

3,000

 

 

13,000

 

to

13,000

 

Economic fuel expense

 

$

137,541

 

to

$

140,278

 

 

$

552,836

 

to

$

555,642

 

Fuel gallons consumed

 

68,089

 

to

69,444

 

 

269,676

 

to

271,045

 

Economic fuel costs per gallon

 

$

2.02

 

to

$

2.02

 

 

$

2.05

 

to

$

2.05

 
 

 

Table 4.

Hawaiian Holdings, Inc.

Non-GAAP Financial Reconciliation (unaudited)

The Company evaluates its financial performance utilizing various GAAP and non-GAAP financial measures, including net income, diluted net income per share, CASM, PRASM, RASM, Passenger Revenue per RPM and EBITDAR.  Pursuant to Regulation G, the Company has included the following reconciliation of reported non-GAAP financial measures to comparable financial measures reported on a GAAP basis.  The adjustments are described below:

• Changes in fair value of derivative contracts, net of tax, are based on market prices for open contracts as of the end of the reporting period.  This line item includes the unrealized amounts of fuel derivatives (not designated as hedges) that will settle in future periods and the reversal of prior period unrealized amounts.

• Unrealized loss (gain) on foreign debt is based on fluctuations in foreign exchange rates related to foreign-denominated debt agreements.

• During the nine months ended September 30, 2019, the Company recorded a gain on disposal of Boeing 767-300 aircraft equipment of $1.9 million in conjunction with the retirement of its Boeing 767-300 fleet. During the three and nine months ended September 30, 2018, we also recorded a loss on the sale of two Boeing 767-300 aircraft covered under a forward sale agreement of $1.8 million.

The Company believes that excluding the impact of these derivative adjustments, fluctuations in foreign exchange rates, and the sale of aircraft and aircraft equipment helps investors better analyze the Company's operational performance and compare its results to other airlines in the periods presented.

 

2018 contract terminations expense

• During the nine months ended September 30, 2018, the Company terminated two contracts which resulted in a $35.3 million contract terminations expense.  In February 2018, the Company exercised its right to terminate its purchase agreement with Airbus for six Airbus A330-800neo aircraft and the purchase rights for an additional six Airbus A330-800neo aircraft.  The Company recorded a contract terminations expense to reflect a portion of the termination penalty.  In January 2018, the Company entered into a transaction with its lessor to early terminate three Boeing 767-300 aircraft leases and concurrently entered into a forward sale agreement for the same three Boeing 767-300 aircraft, including two Pratt & Whitney 4060 engines for each aircraft.  These aircraft were previously accounted for as operating leases.  In order to exit the leases and purchase the aircraft, the Company agreed to pay a total of $67.1 million (net of all deposits) of which a portion, $35.3 million, was expensed immediately and recognized as a lease termination fee.  The expensed amount represents the total purchase price over fair value of the aircraft purchased as of the date of the transaction.

 

 

Three months ended September 30,

 

Nine months ended September 30,

 

 

2019

 

2018

 

2019

 

2018

 

 

Total

 

Diluted Per Share

 

Total

 

Diluted Per Share

 

Total

 

Diluted Per Share

 

Total

 

Diluted Per Share

 

 

(in thousands, except per share data)

GAAP Net Income, as reported

 

$

80,076

 

 

$

1.70

 

 

$

93,542

 

 

$

1.84

 

 

$

174,267

 

 

$

3.64

 

 

$

201,564

 

 

$

3.96

 

Add (deduct): changes in fair value of derivative contracts

 

1,154

 

 

0.02

 

 

4,590

 

 

0.09

 

 

(2,091

)

 

(0.04

)

 

(2,492

)

 

(0.05

)

Add: unrealized loss (gain) on foreign debt

 

717

 

 

0.01

 

 

(2,267

)

 

(0.04

)

 

2,254

 

 

0.05

 

 

(2,331

)

 

(0.05

)

Add: loss (gain) on sale of aircraft and equipment

 

—

 

 

—

 

 

1,844

 

 

0.04

 

 

(1,948

)

 

(0.04

)

 

1,844

 

 

0.04

 

Add: contract terminations expense

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

—

 

 

35,322

 

 

0.69

 

Deduct: tax effect of adjustments

 

(490

)

 

(0.01

)

 

(1,042

)

 

(0.02

)

 

473

 

 

0.01

 

 

(8,086

)

 

(0.16

)

Adjusted Net Income

 

$

81,457

 

 

$

1.72

 

 

$

96,667

 

 

$

1.91

 

 

$

172,955

 

 

$

3.62

 

 

$

225,821

 

 

$

4.43

 

 

 

 

 

 

 

 

Three months ended September 30,

 

Nine months ended September 30,

 

 

2019

 

2018

 

2019

 

2018

 

 

(in thousands)

Income Before Income Taxes, as reported

 

$

108,519

 

 

$

116,757

 

 

$

237,087

 

 

$

259,639

 

Add (deduct): changes in fair value of derivative contracts

 

1,154

 

 

4,590

 

 

(2,091

)

 

(2,492

)

Add: unrealized loss (gain) on foreign debt

 

717

 

 

(2,267

)

 

2,254

 

 

(2,331

)

Add: loss (gain) on sale of aircraft and equipment

 

—

 

 

1,844

 

 

(1,948

)

 

1,844

 

Add: contract terminations expense

 

—

 

 

—

 

 

—

 

 

35,322

 

Adjusted Income Before Income Taxes

 

$

110,390

 

 

$

120,924

 

 

$

235,302

 

 

$

291,982

 
                                                                                               

Operating Costs per Available Seat Mile (CASM)

The Company has separately listed in the table below its fuel costs per ASM and non-GAAP unit costs, excluding fuel and non-recurring items.  These amounts are included in CASM, but for internal purposes the Company consistently uses cost metrics that exclude fuel and non-recurring items (if applicable) to measure and monitor its costs.

 

 

Three months ended September 30,

 

Nine months ended September 30,

 

 

2019

 

2018

 

2019

 

2018

 

 

(in thousands, except CASM data)

GAAP Operating Expenses

 

$

638,515

 

 

$

643,261

 

 

$

1,865,898

 

 

$

1,894,927

 

Less: aircraft fuel, including taxes and delivery

 

(138,586

)

 

(162,932

)

 

(405,290

)

 

(449,404

)

Less: (loss) gain on sale of aircraft and equipment

 

—

 

 

(1,844

)

 

1,948

 

 

(1,844

)

Less: contract terminations expense

 

—

 

 

—

 

 

—

 

 

(35,322

)

Adjusted Operating Expenses

 

$

499,929

 

 

$

478,485

 

 

$

1,462,556

 

 

$

1,408,357

 

Available Seat Miles

 

5,331,914

 

 

5,352,976

 

 

15,341,510

 

 

15,104,500

 

CASM – GAAP

 

11.98

¢

 

12.02

¢

 

12.16

¢

 

12.55

¢

Less: aircraft fuel

 

(2.60

)

 

(3.05

)

 

(2.64

)

 

(2.98

)

Less: (loss) gain on sale of aircraft and equipment

 

—

 

 

(0.03

)

 

0.01

 

 

(0.01

)

Less: contract terminations expense

 

—

 

 

—

 

 

—

 

 

(0.24

)

Adjusted CASM

 

9.38

¢

 

8.94

¢

 

9.53

¢

 

9.32

¢

 

 

 

Estimated three months ending

December 31, 2019

 

Estimated full year ending

December 31, 2019

 

 

(in thousands, except CASM data)

GAAP Operating Expenses

 

$

630,768

 

to

$

655,760

 

 

$

2,495,146

 

to

$

2,523,013

 

Less: aircraft fuel, including taxes and delivery

 

(134,541

)

to

(137,278

)

 

(539,836

)

to

(542,642

)

Less: (loss) gain on sale of aircraft and equipment

 

—

 

to

—

 

 

1,948

 

to

1,948

 

Adjusted Operating Expenses

 

$

496,227

 

to

$

518,482

 

 

$

1,957,258

 

to

$

1,982,319

 

Available Seat Miles

 

5,219,434

 

to

5,295,446

 

 

20,541,144

 

to

20,641,934

 

CASM – GAAP

 

12.08

¢

to

12.38

¢

 

12.15

¢

to

12.22

¢

Less: aircraft fuel

 

(2.58

)

to

(2.59

)

 

(2.63

)

to

(2.63

)

Less: (loss) gain on sale of aircraft and equipment

 

—

 

to

—

 

 

0.01

 

to

0.01

 

Adjusted CASM

 

9.50

¢

to

9.79

¢

 

9.53

¢

to

9.60

¢
 

Pre-tax margin

The Company excludes unrealized gains from fuel derivative contracts, losses on extinguishment of debt, and non-recurring items from pre-tax margin for the same reasons as described above.

 

 

Three months ended September 30,

 

Nine months ended September 30,

 

 

2019

 

2018

 

2019

 

2018

Pre-Tax Margin, as reported

 

14.4

%

 

15.4

%

 

11.2

%

 

12.1

%

Add: changes in fair value of derivative contracts

 

0.2

 

 

0.6

 

 

(0.1

)

 

(0.1

)

Add: unrealized loss (gain) on foreign debt

 

0.1

 

 

(0.3

)

 

0.1

 

 

(0.1

)

Add: loss (gain) on sale of aircraft and equipment

 

—

 

 

0.2

 

 

(0.1

)

 

0.1

 

Add: contract terminations expense

 

—

 

 

—

 

 

—

 

 

1.7

 

Adjusted Pre-Tax Margin

 

14.6

%

 

15.9

%

 

11.1

%

 

13.6

%
 

Leverage ratio

The Company uses adjusted total debt, including aircraft rent, in addition to long-term adjusted debt and finance leases, to represent long-term financial obligations.  The Company excludes unrealized (gains) losses from fuel derivative contracts, losses on extinguishment of debt, and non-recurring items from earnings before interest, taxes, depreciation, amortization and rent (EBITDAR) for the reasons described above.  Management believes this metric is helpful to investors in assessing the Company’s overall debt.

 

 

 

Twelve months ended

 

 

September 30, 2019

 

 

(in thousands, except Leverage Ratio)

Debt and finance lease obligations

 

$

781,541

 

Plus: Aircraft leases capitalized at 7x last twelve months' aircraft rent

 

869,407

 

Adjusted debt and finance lease obligations

 

$

1,650,948

 

 

 

 

EBITDAR:

 

 

Income Before Income Taxes

 

$

278,606

 

Add back:

 

 

Interest and amortization of debt discounts and issuance costs

 

29,641

 

Depreciation and amortization

 

157,603

 

Aircraft rent

 

124,201

 

EBITDAR

 

$

590,051

 

 

 

 

Adjustments:

 

 

Add: changes in fair value of derivative contracts

 

$

20,373

 

Add: unrealized loss (gain) on foreign debt

 

4,965

 

Add: loss (gain) on sale of aircraft and equipment

 

(3,483

)

Adjusted EBITDAR

 

$

611,906

 

 

 

 

Leverage Ratio

 

2.7

x
 

Watch how Alaska employees surprised kids at Mary’s Place, part of our Week of LIFT

A roar of excitement filled the inside of Mary’s Place, a nonprofit in King County that provides safe, inclusive shelter services for women and families, on Friday afternoon while children and teens were surprised with a brand-new playroom and study space filled with games, bean bag chairs and a fresh coat of paint.

The event was part of Alaska Airlines’ initiative to make flying matter during our companywide week of giving back to the communities we serve, called the Week of LIFT. More than 700 Alaska employees volunteered at over 20 events in nine cities across the United States.

Francis Kelly with her 1-year-old son at Mary’s Place | Photo by Alan Alabastro

Some of the volunteer events included serving at local food banks, teaching classes and participating in outdoor cleanups through organizations like KUPU in Honolulu, New York Cares in New York City, Covenant House in Anchorage, Reading Partners in the Bay Area and Mary’s Place in Seattle.

“I’m shocked, I’m excited for my son and for all these little kids to have something to play with, this is a very big difference,” said Francis Kelly, a Mary’s Place guest. “We don’t know what it’s like to be home. So, for these kids to have a place to play is happiness for us.”

Linda Mitchell, the chief communications officer of the family shelter, said their mission is to have no child sleep outside — and give them the chance to play like a regular kid. For 20 years, Mitchell said all eight shelters located across the greater Seattle region have kept women, children and families together, inside and safe when they have no place else to go.

“We have truly cherished our relationship with our hometown airline over the years,” said Marty Hartman, executive director of Mary’s Place. “Funding, sponsorships, and volunteer projects like the ‘Week of LIFT’ are transformative for Mary’s Place, and our families.”

Watch the big reveal:

Video by Randy Eng

“We are so grateful to be included in this special week of giving and to the amazing volunteers who brightened our spaces, added toys and furniture for our Kids Club and Teen Rooms to remind families that they are not forgotten and our community cares about them,” said Hartman. “You all are bringing so much love and hope – what an incredible gift!”

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We know getting involved makes a difference.

Giving back is part of who we are. From the beginning, serving people and our communities has defined us. Driven by our incredible employees, Alaska and Horizon have a legacy of thinking long-term, taking care of each other, giving back to the communities we serve, and flying greener.

“It’s about people — the people who make up our workplaces and this place we call home.” -excerpt from Puget Sound Business Journal Opinion: Corporate responsibility isn’t all corporate — it’s about people and community by Diana Birkett Rakow, VP Alaska Airlines External Relations

Named after the core principle of motion, LIFT allows us to fly, taking people where they need to go. “Where someone needs to go” isn’t always a destination city–it could be a community center, a school or shelter–you name it. We’re always looking to new ways to inspire our guests and to help those around them.

Want to get involved?

Here are few ways you can join us in making an impact:

Learn more about Alaska Airlines’ LIFT program and read the 2018 Sustainability Report. Follow our efforts @AlaskaAir, tag us with the hashtag #makingflyingmatter or #iflyalaska.

Opinion: Corporate responsibility isn’t all corporate — it’s about people and community (Puget Sound Business Journal)

Adapted from a column originally published in the Puget Sound Business Journal on October 21, 2019.

By Diana Birkett Rakow, Alaska Airlines Vice President of External Relations

Open up the newspaper today, and you’ll find countless articles and opinion pieces on the role of a company – especially in times of growth. Is it jobs and innovation? Products that help people’s lives? Or is there a broader responsibility — to help solve challenging policy issues and enable the solutions? Or is the answer really “all of the above”?

The Business Roundtable waded into the conversation a couple of months ago, with a statement redefining the purpose of a corporation to promote “an economy that serves all.”

Media forums including the PSBJ’s Grow Seattle Conference have also been talking a lot about growth recently. There’s a lot of it here in the Seattle region, and some debate whether that’s a good thing. And while that growth creates some challenges, it also enables the resources to support and address them — Amazon providing a home for Mary’s Place families inside a new downtown building, Microsoft committing $500 million to affordable housing, Dick’s Burgers creating jobs and career pathways for local youth, REI advancing equity in the ability to get outdoors.

Many of us learned the concept of responsibility early, and for many it is a core value: responsibility to our families, loved ones, neighbors, colleagues, employer, and community. I’d argue it is and should be the same for companies — a core value, derived from the people who make us who we are. A way of life, not a program and not lived through a report.

Having worked in both public and private sectors, I appreciate the cultural traits that Alaska Airlines derived from its inception serving small communities across Alaska. It’s a sense that everything is connected and that we all are here to serve.

This week, hundreds of Alaska employees are out in the community, from New York to Seattle to Hawaii, to serve through our “Week of LIFT.” The program is named after the core principle of motion that allows us to fly, taking people where they need to go. And we know that “where someone needs to go” isn’t always a destination city. Sometimes it’s community, opportunity, or seeing a path to the future.

In Seattle, Alaska Airlines volunteers deep clean, organize, do yard work and prep meals for homeless families at Mary’s Place. They serve food at Farestart’s Guest Chef Night, pack food at Northwest Harvest, help keep Tacoma’s water clean on Orca Recovery Day, and create and organize LEGO League kits for FIRST Washington youth education programs.

[inset]

At the end of the day, “corporate responsibility” is not just “corporate.” It’s about people and our responsibility to each other, those inside our companies and those around us. We can and should use economic lift to improve lives, enable opportunity, and share the benefits.

Businesses’ ability to give back in these ways, though, is directly connected to economic growth when we think long term. This work benefits from an environment that enables a vibrant and diverse business community sustaining into the future, enabling growth that works for all.

As a region, it’s incumbent on us to find this balance. It’s not about an annual report, though those are worth a read. It’s about people — the people who make up our workplaces and this place we call home.

Meet Flight Attendant Marcie Peterson: “An oasis of calm” and Customer Service Legend

The burly 30-something guest seated at the back of the plane seemed to be trembling during aircraft boarding in Seattle. Flight attendant Marcie Peterson slid into the empty seat next to him and asked how he was doing. “I’m so afraid of flying,” said the guest, a server for a prominent Seattle restaurant. She reassured him and kept checking on him during the flight. As the grateful guest deplaned, he invited her to visit the restaurant “any time.”

Flight attendants are “an oasis of calm” for guests, says Peterson, who has been with Alaska Airlines for nearly 30 years. “They see you are calm, and they know you also have a family and kids, and you wouldn’t be here if you were concerned, and they realize it’s all right.”

She likes to converse and make a connection with everyone she can on each flight. “I value every guest, and I want to make the flight fun and positive and memorable,” she says. “We get each moment in life only once, and since we’re going to have this time on the plane together, why not make it happy and fun?”

She is also known for always smiling, a reputation she cherishes. “Six years ago, I was in a bicycle accident and felt I had lost my face from the nose down. They didn’t know if they’d be able to reconstruct everything. I’m so grateful I have a smile and that I’m able to share it with other people,” she says.

She also shares her compassion, such as regularly making sandwiches for the homeless, helping people recovering from addiction, and leaving snacks and pop in a cabinet outside her home for postal carriers and delivery people.

She had wanted to be a flight attendant since she was a young girl, she says, and as soon as she was eligible to apply, at age 21, she sent a handwritten application letter to Alaska, her hometown Seattle-based airline. “I’m still pinching myself that I get to do this. I wanted to work for the best airline. When you get to say you fly for Alaska Airlines, it feels good.” —M. Dill

Questions & answers

What do you like about your job? There is so much variety, and the people I work with are really good people—there’s camaraderie. I also have the opportunity to make a difference for guests every day. I’ve used our safety training to do CPR and bring someone back to life. That was an amazing and fulfilling moment.

What’s important to you in life? My husband and our two kids, and helping others. I love Martin Luther King Jr.’s quote, “Life’s most persistent and urgent question is, ‘What are you doing for others?’” For my 50th birthday, I invited people to do 50 easy acts of kindness, from a list of 80, over six months. I did them all first so I could provide photos and how-to.

What advice do you have for employees about how to succeed at Alaska Airlines? “Enjoy moments! Our industry gives us the unique opportunity to make daily heartfelt connections. Alaska Airlines encourages each of us to embrace the responsibility of providing positive memories to our customers and peers. Make your joy contagious and your efforts palpable. It is so satisfying to witness when happiness becomes infectious.”

What do you like to do for recreation? Long-distance backpacking. I’ve hiked in remote areas of India, and in Thailand and Laos, and the 165 miles of the Tahoe Rim Trail in the mountains around Lake Tahoe.

Kudos from Marcie’s co-workers

“Marcie Peterson is remarkable. She leaves a positive impression on everyone. She inspires and encourages others—guests and colleagues. Working with her and other dedicated flight attendants has been a highlight of my career. She shines inside and out, and is truly a legend.” —Tom R., Inflight Supervisor, Seattle

“Whenever I’ve flown with her over the past 29 years—and I can speak for many others who have flown with her—she’s always had a smile on her face, whether she was having a good day or a bad day. She smiles at guests; she smiles at co-workers, at pilots, at everyone. And she just makes the mood of the aircraft and the mood of the flight upbeat. She makes everyone feel at ease.” —Yasmin V., Flight Attendant, Seattle

“On each one of her flights, she makes every person feel special, from children to our top MVP Gold 75K guests. I’m so thankful I know her.” —Vicki L., Customer Service Agent (retired), Seattle

Alaska Airlines employees such as Marcie Peterson are the reason for our excellence. Join us in creating an airline people love. Visit careers.alaskaair.com.

How Alaska’s internships show students they can be whoever they want to be

During her junior year of high school, Kamia Bradley had the fleeting thought of becoming an airline pilot. She didn’t know where to start but thought it seemed like a cool job.

Growing up in Denver, sometimes with no heat or having to sleep on the floor, it was tough to see a better horizon. Until one day, through a leadership program at her high school, Bradley had her first flying experience in the seat of a helicopter. The pilot flew over her neighborhood, a place she describes as uninviting and neglected but something changed when she was up there.

“Seeing my home from above, and how it connected to the rest of the city and beautiful scenery, gave me a new perspective of the world,” Bradley said. “Being up there made me feel like I could do anything.”

Kamia Bradley with Alaska Airlines First Officer Kim Ford. (Photo courtesy of Kamia Bradley)

Bradley learned about a local flight program and the Amelia Earhart Foundation, which, with her hard work, helped her obtain her private pilot’s license. Bradley is now a senior at Embry-Riddle Aeronautical University in Prescott, Arizona, where she studies aeronautical science and recently spent her summer in Seattle as a flight operations intern at Alaska Airlines.

Before interning at Alaska, Bradley discovered Alaska’s pledge to increase our African American female pilots by 2025 and support the path to inspire more young women to become pilots.

Alaska Airlines Base Chief Pilot Ronald Limes and Flight Operations intern Kamia Bradley. (Photo courtesy of Kamia Bradley)

“I thought it was pretty awesome that a company was looking for people just like me,” Bradley said.

Interns at Alaska join teams throughout different departments such as Maintenance and Engineering, Marketing and so on. Interns work on visible projects that impact our guests and business. Beyond hands-on experience, interns also get the opportunity to network with employees and company leaders. Learn more about our internship opportunities. The application window for 2020 internships opens Friday, Oct. 11.

This summer, 34 college interns were hired at Alaska and Horizon Air to work in Portland and Seattle.

“We’re committed to developing future leaders in aviation and beyond. Our internship program is a great way we get to connect with young people from all backgrounds and look forward to offering them a firsthand experience in the aerospace world. We look forward to adding fresh thinking, big ideas and eagerness to learn to our Alaska family,” said Andy Schneider, Alaska Airlines senior vice president of people.

During Bradley’s internship, she spent time with Captain Tara Wright, who made history alongside three other female pilots who were part of Alaska’s first all-female, African American pilot crew.

Over the summer, Bradley flew on a flight piloted by Wright from Los Angeles to Seattle and met up afterward for dinner.

Alaska Flight Operations intern Kamia Bradley with her mentor, Captain Tara Wright, at Alaska Airlines. (Photo courtesy of Kamia Bradley)

“That was the first time seeing a black woman fly other than myself,” said Bradley. “It was one of the best experiences ever.”

In addition to creating meaningful connections this summer, Bradley visited 17 destinations where we fly, spanning from Bristol Bay, Alaska to Washington D.C.

Interns are able to fly unlimited using standby travel on Alaska Airlines during their internship. That means many weekends are filled with jet setting across the country.

Lauren Hardwood, an Alaska Airlines summer 2019 technology training intern and University of Washington student, says her favorite trip was traveling with her sister to San Francisco.

Lauren Hardwood, Alaska Airlines summer 2019 technology training intern at the end of her internship on presentation day with her mentor Quinton Rosencrans, loyalty analyst at Alaska Airlines. (Photo by Tina Hong-Sandmel)

“We just went for a day, and it was super fun just to fly in,” she said. “We walked around, and went to Pier 39, Fisherman’s Wharf, biked up to the Golden Gate Bridge, had a picnic at Painted Ladies and then took a flight home that night.”

While in her internship, Hardwood planned and coordinated technology classes and events like a Microsoft 365 training for all Alaska employees and a women in technology event.

Harwood says it was a great learning experience.

“There’s so much that goes into a flight from start to finish, and you don’t really realize that until you’re here,” she said. “Every day you learn something new.”

Apply for a summer 2020 internship:
  • Paid college internships are open to undergraduate students with an expected graduation date between December 2020 and June 2021
  • Internships are 12 weeks in Seattle or Portland, Oregon; interns work full time (40 hours/week) and start their internship between late May and mid-June
  • The application window for summer 2020 internships is open Oct. 11 through Oct. 21 at alaskaair.jobs
  • Check out alaskaair.jobs for current opportunities at Alaska Airlines and Horizon Air.

Pioneering Alaska flight crew to aspiring pilots: Let your passion soar

Excerpted from the September/October 2019 issue of Aloft, the magazine of The Museum of Flight. Do you know a middle school girl interested in exploring aviation and aerospace? Sign up for Amelia’s Aero Club at the Museum of Flight.

How do you become a pilot? The best way to find out is to ask one – or better yet, talk with two.

First Officer Mallory Cave and Captain Tara Wright are the first all-women, Black female crew working at Alaska Airlines. They recently took time to share their experiences, explaining that the path to becoming a pilot is not always linear, and the aviation industry still has work to do to reach gender and racial equity. Cave and Wright say pilots benefit from building a support network to lean on when things are difficult – relationships that can last a lifetime – and they see aviation as a rewarding career with exciting changes on the horizon.

Growing up, Cave knew she wanted a job that would be fun and different. “I did always dream of having a job that I enjoyed doing every single day,” she says. “I loved flying as a passenger and one day in high school I thought, ‘I wonder what it’s like up front, to actually fly the airplane?’ ”

But she found the process of becoming a pilot challenging at the outset. “One of the toughest times was initially, when I was going through pilot training,” Cave says. “The flight instructors weren’t enthused to fly any extra days with me, although they would fly extra days with the guys. I kept trying to get someone to fly [with me] so that I could get ahead. I got nowhere.” Cave became the first African American woman to earn a degree in aviation flight from Ohio University.

[inset]

As she entered the workforce, she continued to see similar inequalities. “In all of my pilot new hire classes, I was the only female as well as the only African American,” Cave says. “The guys in my class would all gather and study together. They would never extend the invitation to me, I had to invite myself to those study groups. I knew I couldn’t do it on my own, there was no time to be shy or reserved.”

Wright, who has been flying since 1993, considered many career possibilities before deciding to become a pilot. She remembers visiting the airport with her family: “My dad would ask me what kind of airplane it was, and we’d make up stories about where in the world it was headed,” Wright says. “The best part was getting to see the reunions people had with friends and loved ones.”

Wright acknowledges that being a part of the first all-female African American flight crew for Alaska is a big milestone, and it would have been impossible without role models and support. “We’ve achieved this only because of the women that have come before us: Bessie Coleman, Patrice Clark-Washington and other aviatrixes who have paved the way,” she says. “Our grandmothers and mothers instilled a sense of confidence that we can do whatever we want with our lives.”

Wright did not set out to become a pioneer, but became one nonetheless: “As one of only an estimated 150 African American female pilots in the United States, I have racked up a few firsts,” Wright says. “I view each one as a major accomplishment in a world where it often seems most everything has been done.”

And now, the need for pilots is greater than ever. A 2016 report from the Boeing Company predicts that 42 percent of the pilots flying with major airlines in the U.S. will retire in the next 10 years. The Museum of Flight wants to ensure that the talent pool for these and other aviation jobs is a diversified one. The nonprofit is on a mission to provide world-class STEM education to youth in our community. Using the lens of aviation and aerospace, the museum offers programs from pre-kindergarten through high school. These include Connections, a free youth educational membership for students ages 5 to 18; Amelia’s Aero Club, designed to inspire middle school girls in the exploration of STEA2M (Science, Technology, Engineering, Aviation, Art and Mathematics); and the Michael P. Anderson Program, designed to inspire middle school youth from throughout Washington state to participate in the museum’s education programs while being mentored by professionals of color in the aerospace and aviation industries. For all of its education programs, the museum places a special emphasis on recruiting those who are currently underrepresented in STEM fields: girls, students of color, and those from low-income and rural communities.

And thanks to companies like Alaska Airlines, which supports The Museum of Flight’s Aerospace Education Center, students of all ages can explore aerospace inventions, STEM activities and new technology. The future of aerospace is being written today, and The Museum of Flight offers the tools needed to succeed.

Other organizations offering resources to increase diversity in aviation include the Organization of Black Aerospace Professionals, Sisters of the Skies and Women in Aviation. This year Alaska signed a pledge with Sisters of the Skies to increase the number of female African American pilots by 2025.

So, what does it take to become a pilot? “Insert yourself! Donʼt try and do it all on your own. Surround yourself with people and mentors in the aviation industry you feel comfortable confiding in,” Cave says. “If you are passionate about aviation, that passion will drive you to become successful.”

With the high demand for pilots and aviation professionals in the coming years, it’s the perfect time to learn what it takes to earn your wings. “Today, kids excited about being airline pilots have the wind at their backs,” Wright says. “The worldwide market is expanding rapidly. What took me 30 years to accomplish, it might take someone just starting out just half the time.”

Hawaiian Holdings Announces 2019 Third Quarter Conference Call

HA High Res Logo_mid

HONOLULU, Oct. 8, 2019 /PRNewswire/ — Hawaiian Holdings, Inc. (NASDAQ: HA), parent company of Hawaiian Airlines, Inc. ("Hawaiian"), plans to report its third quarter 2019 financial results after the market closes on Tuesday, October 22, 2019. An investor conference call is scheduled for 4:30 p.m. Eastern Time.

(PRNewsfoto/Hawaiian Holdings, Inc.)

The call will be open to all interested investors through a live audio webcast accessible in the Investor Relations section of Hawaiian's website at HawaiianAirlines.com. For those who are not able to listen to the live webcast, the call will be archived for 90 days on Hawaiian's website.

About Hawaiian Airlines

Hawaiian® has led all U.S. carriers in on-time performance for each of the past 15 years (2004-2018) as reported by the U.S. Department of Transportation. Consumer surveys by Condé Nast Traveler, Travel + Leisure and TripAdvisor have placed Hawaiian among the top of all domestic airlines serving Hawai'i.

Now in its 90th year of continuous service, Hawaiian is Hawai'i's biggest and longest-serving airline. Hawaiian offers non-stop service to Hawai'i from more U.S. gateway cities (13) than any other airline, along with service from Japan, South Korea, Australia, New Zealand, American Samoa and Tahiti. Hawaiian also provides, on average, more than 170 jet flights daily between the Hawaiian Islands, with a total of more than 260 daily flights system-wide.

Hawaiian Airlines, Inc. is a subsidiary of Hawaiian Holdings, Inc. (NASDAQ: HA). Additional information is available at HawaiianAirlines.com. Follow Hawaiian's Twitter updates (@HawaiianAir), become a fan on Facebook (Hawaiian Airlines), and follow us on Instagram (hawaiianairlines). For career postings and updates, follow Hawaiian's LinkedIn page.

For media inquiries, please visit Hawaiian Airlines' online newsroom.

 

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/hawaiian-holdings-announces-2019-third-quarter-conference-call-300934260.html

SOURCE Hawaiian Holdings, Inc.

Spreading Awareness on Big Island’s Remote, Debris-Ridden Beaches

Our island home is known for its beautiful, picturesque coastlines. Many of our keiki (children) have grown up on these beaches, and our state relies on a healthy ocean for the wellbeing of its communities. However, Hawai‘i’s coastlines have become increasingly plagued with plastic and other marine debris—and nowhere in the state is this issue more visible than on the Big Island’s southeast shoreline.

The coast lining South Point is one of the island’s most remote areas. There, currents and trade winds often bring trash, plastics, commercial fishing equipment, and other debris to the shore, much of it coming from distant sources including the Great Pacific Garbage Patch. 

Hawaiian Airlines has been committed to supporting nonprofit organizations that protect the environment in Hawai’i and the markets we serve. Our latest collaboration took place this past September, when we furthered our partnership with New Zealand nonprofit Sea Cleaners to bring over a dozen inspiring high-school activists from New Zealand, Australia, Japan, and the Hawaiian Islands to mālama the Big Island. 

Team Kokua
Team Kōkua on South Point for the Sea Cleaners beach cleanup. Pictured L to R: Reid Shigeoka from KOA airport station, Debbie Nakanelua-Richards of community and cultural relations, Karen MacMillan of Australia sales and partnerships, Marissa Villegas of external communications, and ‘Iwalani Kaho‘ohanohano of internal communications.

 

In recognition of International Coastal Cleanup Day 2019, the group was given a weeklong itinerary focused on spreading awareness about the impacts plastics and “mindless” consumerism has on Hawai‘i. Our employee volunteer group Team Kōkua joined the Sea Cleaners youth, along with the Hawai‘i Wildlife Fund, Billabong Australia and Hawai‘i Tourism, to do an extensive daylong sweep at South Point.

Need help imaging just how dirty these beaches are? Take the quiz below to get a snapshot of the impact volunteers made in just one morning:

 

Hawaiian Airlines Reports September and Third Quarter 2019 Traffic Statistics and Updates Expected Third Quarter 2019 Metrics

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HONOLULU – Hawaiian Airlines, Inc., a subsidiary of Hawaiian Holdings, Inc. (NASDAQ: HA) (“Hawaiian” or the “Company”), today announced its system-wide traffic statistics for the month and quarter ended September 30, 2019.  The Company also updated its expectations for certain third quarter 2019 financial metrics.

Hawaiian welcomed more than 931,000 guests in September 2019. Total traffic (revenue passenger miles) increased 3.0 percent on an increase of 0.7 percent in capacity (available seat miles) compared to September 2018. Load factor increased 1.9 points to 85.5 percent.

For the third quarter ended September 30, 2019, Hawaiian welcomed more than 3 million guests. Total traffic increased 2.7 percent on a decrease of 0.4 percent in capacity. Load factor increased 2.7 points to 87.8 percent.

The table below summarizes September, third quarter, and year-to-date statistics compared to the respective prior-year periods.

SYSTEM-WIDE OPERATIONS1

SEPTEMBER

2019

2018

% CHANGE

PAX

931,280

918,715

1.4%

RPMs (000)

1,490,482

1,446,766

3.0%

ASMs (000)

1,742,249

1,729,723

0.7%

LF

85.5%

83.6%

1.9 pts

THIRD QUARTER

2019

2018

% CHANGE

PAX

3,071,854

3,039,107

1.1%

RPMS (000)

4,679,632

4,557,706

2.7%

ASMS (000)

5,331,914

5,352,976

(0.4)%

LF

87.8%

85.1%

2.7 pts
 

YEAR-TO-DATE

2019

2018

% CHANGE

PAX

8,853,052

8,948,975

(1.1)%

RPMS (000)

13,300,090

12,921,666

2.9%

ASMS (000)

15,341,510

15,104,500

1.6%

LF

86.7%

85.5%

1.2 pts
 

PAX

Passengers transported

RPM

Revenue Passenger Mile; one paying passenger transported one mile

ASM

Available Seat Mile; one seat transported one mile

LF

Load Factor; percentage of seating capacity filled

1Includes the operations of contract carriers under capacity purchase agreements.

Third Quarter 2019 Outlook

The Company has revised certain of its expectations for the quarter ended September 30, 2019 that were previously provided in its Second Quarter Earnings Release on July 30, 2019.

Specifically, the Company:

• raised its estimates for operating revenue per ASM due to better than expected yields in long-haul markets, particularly in its International entity;

• narrowed its estimates for operating cost per ASM excluding fuel and non-recurring items;

• narrowed its estimates for gallons of jet fuel consumed; and

• lowered its estimates for economic fuel cost per gallon.

The table below summarizes the Company’s revised expectations for the quarter ended September 30, 2019 expressed as an expected percentage change compared to the results for the quarter ended September 30, 2018.

Item

 

Prior Third Quarter 2019 Guidance

 

Revised Third Quarter 2019 Guidance

 

GAAP Equivalent

 

Prior GAAP Third Quarter 2019 Guidance

 

Revised GAAP Third Quarter 2019 Guidance

Operating revenue per available seat mile (ASM)

 

Down 1.5 – 4.5%

 

Down 0.5% – up 0.5%

 

 

 

 

 

 

Cost per ASM (CASM) excluding aircraft fuel and non-recurring items (a)

 

Up 3.5 – 6.5%

 

Up 4.5 – 5.5%

 

Cost per ASM (a)

 

Down 0.5% – Up 1.7%

 

Down 0.8% – Up 0.2%

Gallons of jet fuel consumed

 

Down 2.5 – 4.5%

 

Down 3.0 – 4.0%

 

 

 

 

 

 

 Economic fuel cost per gallon (b)

 

$2.11

 

$2.04

 

Fuel cost per gallon (b)

 

$2.07

 

$1.99

(a) See Table 1 for a reconciliation of GAAP operating expenses to operating expenses excluding aircraft fuel and non-recurring items.

(b) See Table 2 for a reconciliation of GAAP fuel costs to economic fuel costs.

Non-GAAP Financial Reconciliation

Table 1.

Operating Costs per Available Seat Mile (CASM)

(in thousands, except CASM data) (unaudited)

 

Estimated three months ended September 30, 2019

GAAP operating expenses

$

635,989

 

 

to

$

642,227

 

 

Less: aircraft fuel, including taxes and delivery

 

(137,865

)

 

to

 

(139,337

)

 

Adjusted operating expenses – excluding aircraft fuel

$

498,124

 

 

to

$

502,890

 

 

Available Seat Miles

 

5,331,914

 

 

to

 

5,331,914

 

 

CASM – GAAP

 

11.93

 

¢

to

 

12.04

 

¢

Less: aircraft fuel, including taxes and delivery

 

(2.59

)

 

to

 

(2.61

)

 

CASM – excluding aircraft fuel

 

9.34

 

¢

To

 

9.43

 

¢
 

Table 2.

Hawaiian Holdings, Inc.

Economic Fuel Expense (unaudited)

The Company believes that economic fuel expense is a good measure of the effect of fuel prices on its business as it most closely approximates the net cash outflow associated with the purchase of fuel for its operations in a period. The Company defines economic fuel expense as GAAP fuel expense plus losses/(gains) realized through actual cash (receipts)/payments received from or paid to hedge counterparties for fuel hedge derivative contracts settled during the period.

 

 

Estimated three months ending

September 30, 2019

 

 

(in thousands, except per-gallon amounts)

Aircraft fuel expense, including taxes and delivery

 

$

137,865

 

to

$

139,337

 

Realized losses (gains) on settlement of fuel derivative contracts

 

3,400

 

to

3,400

 

Economic fuel expense

 

$

141,265

 

to

$

142,737

 

Fuel gallons consumed

 

69,247

 

to

69,969

 

Economic fuel costs per gallon

 

$

2.04

 

to

$

2.04

 
 

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect the Company’s current views with respect to certain current and future events and financial performance. Such forward-looking statements include, without limitation, the Company’s expectations regarding operating revenue per available seat mile, cost per available seat mile, and cost per available seat mile excluding fuel for the quarter ended September 30, 2019; and statements as to other matters that do not relate strictly to historical facts or statements of assumptions underlying any of the foregoing.  Words such as “expects,” “anticipates,” “projects,” “intends,” “plans,” “believes,” “estimates,” variations of such words, and similar expressions are also intended to identify such forward-looking statements.  These forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and assumptions relating to the Company’s operations and business environment, all of which may cause the Company’s actual results to be materially different from any future results, expressed or implied, in these forward-looking statements.  These risks and uncertainties include, without limitation, the Company’s ability to accurately forecast quarterly results; economic volatility; macroeconomic developments; political developments; the price and availability of aircraft fuel; fluctuations in demand for transportation in the markets in which the Company operates, including due to the occurrence of natural disasters, such as hurricanes, earthquakes and tsunamis; the Company’s dependence on tourist travel; labor negotiations and related developments; competitive pressures, including the impact of rising industry capacity between North America and Hawai‘i; the Company's ability to continue to generate sufficient cash flow to support the payment of a quarterly dividend; changes in the Company's future capital needs; foreign currency exchange rate fluctuations; and the Company’s ability to implement its growth strategy.

The risks, uncertainties and assumptions referred to above that could cause the Company’s results to differ materially from the results expressed or implied by such forward-looking statements also include the risks, uncertainties and assumptions discussed from time to time in the Company’s other public filings and public announcements, including the Company’s Annual Report on Form 10-K and the Company’s Quarterly Reports on Form 10-Q, as well as other documents that may be filed by the Company from time to time with the Securities and Exchange Commission.  All forward-looking statements included in this document are based on information available to the Company on the date hereof.  The Company does not undertake to publicly update or revise any forward-looking statements to reflect events or circumstances that may arise after the date hereof even if experience or future changes make it clear that any projected results expressed or implied herein will not be realized.

About Hawaiian Airlines       

Hawaiian® has led all U.S. carriers in on-time performance for each of the past 15 years (2004-2018) as reported by the U.S. Department of Transportation. Consumer surveys by Condé Nast Traveler, Travel + Leisure and TripAdvisor have placed Hawaiian among the top of all domestic airlines serving Hawai‘i.

Now in its 90th year of continuous service, Hawaiian is Hawaii’s biggest and longest-serving airline. Hawaiian offers non-stop service to Hawai‘i from more U.S. gateway cities (13) than any other airline, along with service from Japan, South Korea, Australia, New Zealand, American Samoa and Tahiti. Hawaiian also provides, on average, more than 170 jet flights daily between the Hawaiian Islands, and over 260 daily flights system-wide.

Hawaiian Airlines, Inc. is a subsidiary of Hawaiian Holdings, Inc. (NASDAQ: HA). Additional information is available at Hawaiian Airlines.com. Follow Hawaiian's Twitter updates (@HawaiianAir), become a fan on Facebook (Hawaiian Airlines), and follow us on Instagram (hawaiianairlines). For career postings and updates, follow Hawaiian's LinkedIn page.

For media inquiries, please visit Hawaiian Airlines' online newsroom.

How many characters can you spot on our newest Pixar-themed plane?

Our latest special paint scheme is Pixar-perfect.

Starting today, guests will start enjoying flights on our Pixar-themed Boeing 737-800 aircraft. Its playful design includes some familiar faces and magical places from the Toy Story animated film series spanning both sides of the plane.

They’re all heading to Pixar Pier, a reimagined land at Disney California Adventure Park at the Disneyland Resort.

Can you spot the pieces of Pixar?

Sheriff Woody: Andy’s favorite pull string cowboy toy is certainly reaching for the sky on our plane – let’s hope his hat doesn’t fly off.

Buzz Lightyear: The evil Emperor Zurg is no match for this Space Ranger of Star Command who’s in between the tail and his friends. To infinity and beyond!

Jessie: The yodeling cowgirl can be spotted wrangling in her pals at the tip of the tail.

Rex: Look closely! You’ll spy the green head of Tyrannosaurus Rex peeking in the window near our plane’s front door. He’s there to say hell-roar to our guests!

Aliens: It’s a bird, it’s a claw … no, it’s an alien strapped to a rocket on our winglet! These identical toys, prizes from an arcade game at the fictional Pizza Planet restaurant, are painted on both winglets.

Luxo ball: It’s the ball that has enjoyed a roll in a number of Pixar movies, most notably ‘Toy Story,’ and the ‘Luxo, Jr.’ short. It sits at the tip of our plane’s nose.

Pixar Pier: It’s a sign. Pixar Pier is the latest reimagined land to explore at Disney California Adventure Park. There you’ll see beloved Pixar characters come to life from the Incredibles Park, Inside Out Headquarters to the Pixar Promenade and Toy Story Boardwalk.

Itinerary must-dos:

  • Looking for your own Bullseye? Don’t miss out on attractions such as the Incredicoaster, Jessie’s Critter Carousel and Inside Out Emotional Whirlwind.
  • Stomach starting to sound like Rex? Grab a bite to eat at Lamplight Lounge and Adorable Snowman Frosted Treats.
  • Want to wrangle goodies like Bo Peep and her sheep? Check out Bing Bong’s Sweet Stuff and Knick’s Knacks.

A terrific friendship

This is our sixth paint scheme celebrating Disneyland Resorts. It’s called “Friendship and Beyond at Disneyland Resort.” The inaugural flight flew from Seattle, with a stop in San Francisco for a gate ceremony and then onto its final destination in Orange County (my guess, next stop: Pixar Pier).

“There’s nothing better than landing happy on the way to The Happiest Place on Earth,” said Natalie Bowman, Alaska Airlines’ managing director of brand marketing and advertising. “The Disneyland Resort is one of our signature West Coast friendships, and we love that we can celebrate Pixar Pier by taking these iconic characters on a brand-new adventure.”

The magic behind the paint:

The exterior of the plane required more than 2,800 work hours over 24 days using more than 50 gallons of paint — in 44 primary colors and custom shades — to completely repaint the aircraft with the vibrant new livery.

Watch the Pixar Pier-themed plane come to life:

You can always book a trip to Southern California to visit Disneyland Resort (or hundreds of other destinations) at alaskaair.com.

Reach for the sky!

Condé Nast Traveler names Alaska “Best U.S. Airline”

It’s a huge honor to be recognized as “Best U.S. Airline” at any time––but two years in a row? We’re thankful to flyers for choosing Alaska, over and over again.  

Today, Condé Nast Traveler named us “Best U.S. Airline” in their 2019 Readers’ Choice Awards. The award is especially significant because it’s based on the ratings of more than 600,000 readers who shared feedback about their recent travel experiences.  

We’re constantly pushing ourselves to be better. Remaining at the top means staying focused on giving you what you want. We work hard to provide you with a remarkable onboard experience from bigger overhead bins and assigned seating to free texting and movies, seatback power and a fresh West Coast-inspired menu. Aircraft makeovers are underway to appeal to modern travelers and we’re in the process of launching high-speed satellite internet to our mainline fleet.  

With our award-winning loyalty program, you earn a mile for every mile you fly, meaning you get free flights faster and more complimentary upgrades for our most frequent flyers.  

What really differentiates us is the care we provide our guests. We have a passion for delivering remarkable service and going the extra mile, time and time again. Our people take great care of you at every moment of your journey, from booking your travel to arriving at your destination.  

“I’m unbelievably proud of our remarkable people. This award is a direct reflection of our values and the tremendous care our employees put into serving you every day,” said Ben Minicucci, Alaska’s president and chief operating officer. “From all of us at Alaska, thank you for flying with us and for sharing what you love about travel.”  

As our guests, you’re the heart of our business, and we’re always striving to give you the best possible experience. Thanks for flying Alaska!  

Want to share in the #BestAirline2019 celebration with us? Follow and retweet @AlaskaAir. 

Book your entire trip using Alaska miles

Today’s frequent-flyer programs don’t stop paying out rewards after you’ve landed. In fact, you can keep earning miles on the go with Alaska Airlines Mileage Plan™. The airline has partners who will help you with great deals on hotels, car rentals and even pet care, making Alaska your one-stop shop for booking travel.

Hotels

Every passenger needs a place to stay after arrival. That’s why Alaska has partnered with Rocketmiles to create the airline’s own hotel booking portal. Earn between 500 and 10,000 miles per night when you book through Alaska Airlines Hotels. That’s right: over ten thousand miles. You can earn thousands of miles at more than 400,000 properties around the world. You may even earn more miles than you redeemed for the award flight that took you there.

And if your account balance is already looking healthy, you can choose to redeem miles for a free or discounted hotel stay. Alaska Airlines Visa Signature® cardholders get a preferred rate so they can save by redeeming fewer miles.

 

Rental Cars

Next, check out Alaska Airlines Cars. This service, powered by CarTrawler, will search through every major brand to find the best price on rentals. When booking through select Mileage Plan partner suppliers, you can earn miles to boost your Mileage Plan account. You can even filter the results to find hybrid vehicles. Depending on the supplier, you might pay in advance or at the counter when you pick up your car, but most suppliers offer free cancellation up to 24 hours in advance, just in case things change.

 

Pet-care

Finally, you need a plan to make sure your pets are well taken care of while you’re away. Rover provides several pet-care solutions, whether you’re at work or on the road. Services include walks, day care, overnight care and more. As an Alaska Mileage Plan member, you earn 3 miles per dollar plus a $30 credit when you complete your first booking, and then 1 mile per dollar after that.

If you want to take your pets with you, Rover can help there, too. Get information on local pet sitters around the country so you can enjoy a night out while leaving your pet in safe hands. Just remember to visit alaskaair.com to get information on Alaska’s pet-travel policies.

Fly Smart, Land Happy

With hotel, car rental and pet care solutions, in addition to great inflight service, Alaska Airlines is committed to helping you enjoy your trip, wherever you’re heading. Explore all of the Mileage Plan partners online so you can continue earning and redeeming miles for bigger rewards.

The Alaska Airlines credit card is issued and administered by Bank of America, N.A. Visa and Visa Signature are registered trademarks of Visa International Service Association and are used by the issuer pursuant to license from Visa U.S.A. Inc.

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