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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Allegiant Travel Company | NASDAQ:ALGT | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
-1.03 | -1.88% | 53.535 | 53.48 | 53.58 | 55.01 | 53.42 | 55.01 | 37,234 | 15:19:03 |
LAS VEGAS, July 29, 2020 /PRNewswire/ -- Allegiant Travel Company (NASDAQ: ALGT) today reported the following financial results for the second quarter 2020, as well as comparisons to the prior year:
Consolidated | Three Months Ended June 30, | Percent | Six Months Ended June 30, | Percent | |||||||||||||||
(unaudited) (in millions, except per share amounts) | 2020 | 2019 | 2020 | 2019 | |||||||||||||||
Total operating revenue | $ | 133.3 | $ | 491.8 | (72.9) | % | $ | 542.5 | $ | 943.4 | (42.5) | % | |||||||
Operating income (loss) | (113.3) | 108.1 | (204.8) | (224.3) | 199.2 | (212.6) | |||||||||||||
Income (loss) before income taxes | (146.4) | 91.8 | (259.5) | (277.1) | 165.7 | (267.2) | |||||||||||||
Net income (loss) | (93.1) | 70.5 | (232.0) | (126.1) | 127.7 | (198.8) | |||||||||||||
Diluted earnings (loss) per share | $ | (5.85) | $ | 4.33 | (235.1) | $ | (7.93) | $ | 7.84 | (201.1) | |||||||||
Consolidated - adjusted | Three Months Ended June 30, | Percent | Six Months Ended June 30, | Percent | |||||||||||||||
(unaudited) (in millions, except per share amounts) | 2020 | 2019 | 2020 | 2019 | |||||||||||||||
Adjusted operating income (loss) (1) (2) | $ | (106.6) | $ | 108.1 | (198.6) | $ | (51.5) | $ | 199.2 | (125.9) | |||||||||
Adjusted income (loss) before income taxes(1) (2) | (119.9) | 91.8 | (230.6) | (77.7) | 165.7 | (146.9) | |||||||||||||
Adjusted net income (loss)(1) (2) | (94.7) | 70.5 | (234.3) | (61.4) | 127.7 | (148.1) | |||||||||||||
Adjusted diluted earnings (loss) per share (1) (2) | $ | (5.96) | $ | 4.33 | (237.6) | $ | (3.87) | $ | 7.84 | (149.4) | |||||||||
Airline only | Three Months Ended June 30, | Percent | Six Months Ended June 30, | Percent | |||||||||||||||
(unaudited) | 2020 | 2019 | 2020 | 2019 | |||||||||||||||
Airline operating revenue (millions)(2) | $ | 129.0 | $ | 486.8 | (73.5) | % | $ | 533.7 | $ | 935.1 | (42.9) | % | |||||||
Airline operating income (loss) (millions)(2) | (105.4) | 115.5 | (191.3) | (54.3) | 214.0 | (125.4) | |||||||||||||
Airline operating margin | (81.7) | % | 23.7 | % | (444.7) | (10.2) | % | 22.9 | % | (144.5) | |||||||||
Airline CASM ex fuel (cents)(2) | 9.32 | 5.65 | 65.0 | 7.50 | 6.00 | 25.0 |
(1) Adjusted to exclude COVID related special charges, the benefit from the CARES Act payroll support program, and a portion of the tax benefit attributable to the CARES Act. |
(2) Denotes a non-GAAP financial measure. Refer to the Non-GAAP Presentation section within this document for further information. |
"The second quarter proved to be the most turbulent quarter in the history of the industry," stated Maurice J. Gallagher, Jr., chairman and CEO of Allegiant Travel Company. "As the virus spread throughout the country in March and April, the industry saw an unprecedented plummet in demand, followed by significant capacity cuts, upwards of 80 to 90 percent. As cases subsided, demand began trickling back in, only to begin recessing again with the uptick in cases beginning late June. It appears demand will continue to ebb and flow along with fluctuations in reported cases for the foreseeable future. We have built a unique way to operate our company as compared to the rest of the industry, which will continue to sustain us throughout the duration of these uncertain times.
"We are experts when it comes to managing capacity to meet demand. Our model was built around flexing capacity up and down to meet differing seasonal demand levels. This quarter proved to be the ultimate test of the model, and I believe our second quarter results highlight its inherent strength. Throughout the quarter, we maintained a very broad network and selling presence, cutting capacity when it made sense, but also capturing demand when it returned. We completed the quarter with roughly 50 percent reductions in capacity, maintaining the broadest schedule of any domestic carrier. Load factors were just over 50 percent, a significant step in the right direction from April lows. During the second quarter, Allegiant passengers accounted for more than five percent of all TSA screenings conducted. That is astonishing given our market share. These results are a testament to our ability to not only manage capacity, but also our ability to manage cost, further highlighting we are best equipped to react to these fluctuations in market conditions.
"Although we were able to manage through the chaos of the quarter, arguably better than most, this environment is unsustainable long-term. It continues to be of utmost importance to strengthen liquidity positions. We completed the quarter with an average daily cash burn of $900 thousand, a 57 percent reduction from our initial forecasts. June bookings were a significant contributor to this reduction, with several days in June exceeding prior year booking levels. In fact, June bookings resulted in cash breakeven for the month of June. We continued to remain disciplined in regard to cost savings and successfully cut more than 38 percent of operating expenses from the quarter. These efforts coupled with funds received related to the CARES Act as well as executed financing arrangements enabled us to grow our liquidity position by nearly $200 million to end the quarter with total liquidity of $663.1 million. Unfortunately, the strength seen in June has since weakened as case numbers have risen. I am comfortable the strides made in building liquidity throughout the quarter will act as a safety net as we continue to manage the ever-changing demand environment.
"In conclusion, I would like to thank our 4,000 team members for their continued hard work. These are difficult times, yet our employees continue to go the extra mile to prioritize the health and safety of our passengers by performing additional cleaning procedures on board our aircraft, encouraging social distancing practices, and exemplifying the principles of our Going the Distance for Health and Safety program. Although I believe the effects of this pandemic will linger well into 2021 and possibly beyond, I firmly believe Allegiant's flexible model and financial strength will not only sustain us during these uncertain times, but will ultimately uniquely position us to recover quickly upon a normalized return of demand."
Covid-19 Responses - Update
Second Quarter 2020 Results
Network
COVID-19 Related Special Charges
CARES Act
Balance Sheet, Cash and Liquidity
(1) Daily cash burn defined as cash from operations less debt and rent payments and capital expenditure outflows excluding aircraft and engine acquisitions as they are expected to be financed. Excludes impact of CARES Act Payroll Support Program funding.
Capital Expenditures
Allegiant Travel Company will host a conference call with analysts at 4:30 p.m. ET Wednesday, July 29 to discuss its second quarter 2020 financial results. A live broadcast of the conference call will be available via the Company's Investor Relations website homepage at http://ir.allegiantair.com. The webcast will also be archived in the "Events & Presentations" section of the website.
As a result of the COVID-19 pandemic, we will hold this year's annual stockholders meeting on Tuesday, August 4, 2020.
Allegiant Travel Company
Las Vegas-based Allegiant (NASDAQ: ALGT) is an integrated travel company with an airline at its heart, focused on connecting customers with premier leisure experiences - from vacations to hometown family entertainment. Since 1999, Allegiant Air has linked travelers in small-to-medium cities to world-class vacation destinations with all-nonstop flights and industry-low average fares. Today, Allegiant's all-Airbus fleet serves communities across the nation, with base airfares less than half the cost of the average domestic roundtrip ticket. For more information, visit us at Allegiant.com. Media information, including photos, is available at http://gofly.us/iiFa303wrtF
Media Inquiries: mediarelations@allegiantair.com
Investor Inquiries: ir@allegiantair.com
Under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, statements in this press release that are not historical facts are forward-looking statements. These forward-looking statements are only estimates or predictions based on our management's beliefs and assumptions and on information currently available to our management. Forward-looking statements include our statements regarding future airline operations and capacity, the efficacy of cost saving measures, future expenditures, our ability to access additional funds from the Treasury, cash burn, the timing of aircraft acquisitions and retirements, aircraft financings, expected capital expenditures, as well as other information concerning future results of operations, business strategies, financing plans, industry environment and potential growth opportunities. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words "believe," "expect," "guidance," "anticipate," "intend," "plan," "estimate", "project", "hope" or similar expressions.
Forward-looking statements involve risks, uncertainties and assumptions. Actual results may differ materially from those expressed in the forward-looking statements. Important risk factors that could cause our results to differ materially from those expressed in the forward-looking statements generally may be found in our periodic reports filed with the Securities and Exchange Commission at www.sec.gov. These risk factors include, without limitation, the impact and duration of the COVID-19 pandemic on airline travel and the economy, an accident involving, or problems with, our aircraft, public perception of our safety, our reliance on our automated systems, our reliance on third parties to deliver aircraft under contract to us on a timely basis, risk of breach of security of personal data, volatility of fuel costs, labor issues and costs, the ability to obtain regulatory approvals as needed , the effect of economic conditions on leisure travel, debt covenants and balances, the ability to finance aircraft under contract, terrorist attacks, risks inherent to airlines, our competitive environment, our reliance on third parties who provide facilities or services to us, the possible loss of key personnel, economic and other conditions in markets in which we operate, the ability to successfully develop and finance a resort in Southwest Florida, governmental regulation, increases in maintenance costs and cyclical and seasonal fluctuations in our operating results.
Any forward-looking statements are based on information available to us today and we undertake no obligation to update publicly any forward-looking statements, whether as a result of future events, new information or otherwise.
Detailed financial information follows:
Allegiant Travel Company | ||||||||||
Consolidated Statements of Income | ||||||||||
(in thousands, except per share amounts) | ||||||||||
(Unaudited) | ||||||||||
Three Months Ended June 30, | Percent | |||||||||
2020 | 2019 | change | ||||||||
OPERATING REVENUE: | ||||||||||
Passenger revenue | $ | 116,520 | $ | 454,779 | (74.4) | |||||
Third party products | 8,443 | 18,208 | (53.6) | |||||||
Fixed fee contract revenue | 3,237 | 12,487 | (74.1) | |||||||
Other revenue | 5,147 | 6,285 | (18.1) | |||||||
Total operating revenue | 133,347 | 491,759 | (72.9) | |||||||
OPERATING EXPENSES: | ||||||||||
Salary and benefits | 94,790 | 113,592 | (16.6) | |||||||
Depreciation and amortization | 43,296 | 38,494 | 12.5 | |||||||
Aircraft fuel | 27,358 | 119,987 | (77.2) | |||||||
Station operations | 27,405 | 45,870 | (40.3) | |||||||
Maintenance and repairs | 13,032 | 20,877 | (37.6) | |||||||
Sales and marketing | 8,909 | 20,540 | (56.6) | |||||||
Aircraft lease rental | 1,427 | — | NM | |||||||
Other | 23,752 | 24,294 | (2.2) | |||||||
CARES Act grant recognition | (74,539) | — | NM | |||||||
Special charges | 81,169 | — | NM | |||||||
Total operating expense | 246,599 | 383,654 | (35.7) | |||||||
OPERATING INCOME (LOSS) | (113,252) | 108,105 | (204.8) | |||||||
OTHER (INCOME) EXPENSE: | ||||||||||
Interest expense | 14,053 | 20,942 | (32.9) | |||||||
Capitalized interest | — | (1,038) | NM | |||||||
Interest income | (1,417) | (3,502) | (59.5) | |||||||
Special charges | 19,830 | — | NM | |||||||
Other, net | 698 | (86) | (911.6) | |||||||
Total other expense | 33,164 | 16,316 | 103.3 | |||||||
INCOME (LOSS) BEFORE INCOME TAXES | (146,416) | 91,789 | (259.5) | |||||||
INCOME TAX PROVISION (BENEFIT) | (53,313) | 21,246 | (350.9) | |||||||
NET INCOME (LOSS) | $ | (93,103) | $ | 70,543 | (232.0) | |||||
Earnings (loss) per share attributable to common shareholders(1): | ||||||||||
Basic | ($5.85) | $4.33 | (235.1) | |||||||
Diluted | ($5.85) | $4.33 | (235.1) | |||||||
Weighted average shares outstanding used in computing earnings per | ||||||||||
Basic | 15,902 | 16,063 | (1.0) | |||||||
Diluted | 15,902 | 16,069 | (1.0) |
NM - Not meaningful |
(1) The Company's unvested restricted stock awards are considered participating securities as they receive non-forfeitable rights to cash dividends at the same rate as common stock. The Basic and Diluted earnings per share calculations for the periods presented reflect the two-class method mandated by ASC Topic 260, "Earnings Per Share." The two-class method adjusts both the net income and the shares used in the calculation. Application of the two-class method did not have a significant impact on the Basic and Diluted earnings per share for the periods presented. |
Allegiant Travel Company | ||||||||||
Operating Statistics | ||||||||||
(Unaudited) | ||||||||||
Three Months Ended June 30, | Percent | |||||||||
2020 | 2019 | change (1) | ||||||||
OPERATING STATISTICS | ||||||||||
Total system statistics: | ||||||||||
Passengers | 1,273,258 | 4,169,536 | (69.5) | |||||||
Available seat miles (ASMs) (thousands) | 2,220,755 | 4,447,066 | (50.1) | |||||||
Airline operating expense per ASM (CASM) (cents) | 10.55 | 8.35 | 26.3 | |||||||
Adjusted airline operating expense per ASM (CASM) (cents) | 10.49 | 8.35 | 25.6 | |||||||
Fuel expense per ASM (cents) | 1.23 | 2.70 | (54.4) | |||||||
Airline operating CASM, excluding fuel (cents) | 9.32 | 5.65 | 65.0 | |||||||
Adjusted airline operating CASM, excluding fuel (cents) | 9.26 | 5.65 | 63.9 | |||||||
ASMs per gallon of fuel | 90.0 | 82.3 | 9.4 | |||||||
Departures | 15,089 | 30,547 | (50.6) | |||||||
Block hours | 32,989 | 68,332 | (51.7) | |||||||
Average stage length (miles) | 850 | 853 | (0.4) | |||||||
Average number of operating aircraft during period | 90.7 | 85.0 | 6.7 | |||||||
Average block hours per aircraft per day | 3.8 | 8.8 | (56.8) | |||||||
Full-time equivalent employees at end of period | 4,349 | 4,179 | 4.1 | |||||||
Fuel gallons consumed (thousands) | 24,664 | 54,064 | (54.4) | |||||||
Average fuel cost per gallon | $ | 1.11 | $ | 2.22 | (50.0) | |||||
Scheduled service statistics: | ||||||||||
Passengers | 1,266,077 | 4,131,855 | (69.4) | |||||||
Revenue passenger miles (RPMs) (thousands) | 1,107,534 | 3,603,076 | (69.3) | |||||||
Available seat miles (ASMs) (thousands) | 2,174,683 | 4,311,182 | (49.6) | |||||||
Load factor | 50.9 | % | 83.6 | % | (32.7) | |||||
Departures | 14,683 | 29,567 | (50.3) | |||||||
Block hours | 32,248 | 66,135 | (51.2) | |||||||
Total passenger revenue per ASM (TRASM) (cents)(2) | 5.75 | 10.97 | (47.6) | |||||||
Average fare - total scheduled service(3) | $ | 40.46 | $ | 58.39 | (30.7) | |||||
Average fare - air-related charges(3) | $ | 51.57 | $ | 51.68 | (0.2) | |||||
Average fare - third party products | $ | 6.67 | $ | 4.40 | 51.6 | |||||
Average fare - total | $ | 98.70 | $ | 114.47 | (13.8) | |||||
Average stage length (miles) | 855 | 853 | 0.2 | |||||||
Fuel gallons consumed (thousands) | 24,124 | 52,327 | (53.9) | |||||||
Average fuel cost per gallon | $ | 1.08 | $ | 2.22 | (51.4) | |||||
Percent of sales through website during period | 93.8 | % | 93.5 | % | 0.3 | |||||
Other data: | ||||||||||
Rental car days sold | 135,536 | 540,960 | (74.9) | |||||||
Hotel room nights sold | 12,772 | 114,191 | (88.8) |
(1) Except load factor and percent of sales through website, which is percentage point change. |
(2) Various components of this measurement do not have a direct correlation to ASMs. These figures are provided on a per ASM |
(3) Reflects division of passenger revenue between scheduled service and air-related charges in Company's booking path. |
Allegiant Travel Company | ||||||||||
Consolidated Statements of Income | ||||||||||
(in thousands, except per share amounts) | ||||||||||
(Unaudited) | ||||||||||
Six Months Ended June 30, | Percent | |||||||||
2020 | 2019 | change | ||||||||
OPERATING REVENUE: | ||||||||||
Passenger revenue | $ | 495,431 | $ | 874,755 | (43.4) | |||||
Third party products | 24,419 | 35,350 | (30.9) | |||||||
Fixed fee contract revenue | 12,156 | 23,061 | (47.3) | |||||||
Other revenue | 10,522 | 10,215 | 3.0 | |||||||
Total operating revenue | 542,528 | 943,381 | (42.5) | |||||||
OPERATING EXPENSES: | ||||||||||
Salary and benefits | 207,436 | 233,003 | (11.0) | |||||||
Aircraft fuel | 116,171 | 219,670 | (47.1) | |||||||
Depreciation and amortization | 86,995 | 74,676 | 16.5 | |||||||
Station operations | 68,405 | 84,835 | (19.4) | |||||||
Maintenance and repairs | 34,827 | 43,701 | (20.3) | |||||||
Sales and marketing | 27,364 | 41,466 | (34.0) | |||||||
Aircraft lease rentals | 2,389 | — | NM | |||||||
Other | 50,468 | 46,849 | 7.7 | |||||||
CARES Act grant recognition | (74,539) | — | NM | |||||||
Special charges | 247,267 | — | NM | |||||||
Total operating expense | 766,783 | 744,200 | 3.0 | |||||||
OPERATING INCOME (LOSS) | (224,255) | 199,181 | (212.6) | |||||||
OTHER (INCOME) EXPENSE: | ||||||||||
Interest expense | 32,206 | 39,025 | (17.5) | |||||||
Capitalized interest | (4,067) | (2,541) | 60.1 | |||||||
Interest income | (3,728) | (6,703) | (44.4) | |||||||
Loss on extinguishment of debt | 1,222 | 3,677 | (66.8) | |||||||
Special charges | 26,632 | — | NM | |||||||
Other, net | 623 | 15 | 4,053.3 | |||||||
Total other expense | 52,888 | 33,473 | 58.0 | |||||||
INCOME (LOSS) BEFORE INCOME TAXES | (277,143) | 165,708 | (267.2) | |||||||
INCOME TAX PROVISION (BENEFIT) | (151,030) | 38,041 | (497.0) | |||||||
NET INCOME (LOSS) | $ | (126,113) | $ | 127,667 | (198.8) | |||||
Earnings (loss) per share attributable to common shareholders(1): | ||||||||||
Basic | ($7.93) | $7.85 | (201.0) | |||||||
Diluted | ($7.93) | $7.84 | (201.1) | |||||||
Weighted average shares outstanding used in computing earnings per | ||||||||||
Basic | 15,927 | 16,037 | (0.7) | |||||||
Diluted | 15,927 | 16,050 | (0.8) |
NM - Not meaningful |
(1) The Company's unvested restricted stock awards are considered participating securities as they receive non-forfeitable rights to cash dividends at the same rate as common stock. The Basic and Diluted earnings per share calculations for the periods presented reflect the two-class method mandated by ASC Topic 260, "Earnings Per Share." The two-class method adjusts both the net income and the shares used in the calculation. Application of the two-class method did not have a significant impact on the Basic and Diluted earnings per share for the periods presented. |
Allegiant Travel Company | ||||||||||
Operating Statistics | ||||||||||
(Unaudited) | ||||||||||
Six Months Ended June 30, | Percent | |||||||||
2020 | 2019 | change(1) | ||||||||
OPERATING STATISTICS | ||||||||||
Total system statistics: | ||||||||||
Passengers | 4,448,708 | 7,619,814 | (41.6) | |||||||
Available seat miles (ASMs) (thousands) | 6,288,427 | 8,357,304 | (24.8) | |||||||
Airline operating expense per ASM (CASM) (cents) | 9.35 | 8.63 | 8.3 | |||||||
Adjusted airline operating expense per ASM (CASM) (cents) | 9.18 | 8.63 | 6.4 | |||||||
Fuel expense per ASM (cents) | 1.85 | 2.63 | (29.7) | |||||||
Airline operating CASM, excluding fuel (cents) | 7.50 | 6.00 | 25.0 | |||||||
Adjusted airline operating CASM, excluding fuel (cents) | 7.33 | 6.00 | 22.2 | |||||||
ASMs per gallon of fuel | 87.2 | 83.1 | 4.9 | |||||||
Departures | 41,401 | 55,747 | (25.7) | |||||||
Block hours | 95,112 | 128,151 | (25.8) | |||||||
Average stage length (miles) | 879 | 876 | 0.3 | |||||||
Average number of operating aircraft during period | 92.1 | 82.3 | 11.9 | |||||||
Average block hours per aircraft per day | 5.5 | 8.6 | (36.0) | |||||||
Full-time equivalent employees at end of period | 4,349 | 4,179 | 4.1 | |||||||
Fuel gallons consumed (thousands) | 72,143 | 100,537 | (28.2) | |||||||
Average fuel cost per gallon | $ | 1.61 | $ | 2.18 | (26.1) | |||||
Scheduled service statistics: | ||||||||||
Passengers | 4,420,683 | 7,553,393 | (41.5) | |||||||
Revenue passenger miles (RPMs) (thousands) | 4,033,017 | 6,794,122 | (40.6) | |||||||
Available seat miles (ASMs) (thousands) | 6,138,692 | 8,113,315 | (24.3) | |||||||
Load factor | 65.7 | % | 83.7 | % | (18.0) | |||||
Departures | 40,167 | 53,911 | (25.5) | |||||||
Block hours | 92,594 | 124,098 | (25.4) | |||||||
Total passenger revenue per ASM (TRASM) (cents)(2) | 8.47 | 11.22 | (24.5) | |||||||
Average fare - scheduled service(3) | $ | 57.27 | $ | 63.49 | (9.8) | |||||
Average fare - air-related charges(3) | $ | 54.80 | $ | 52.32 | 4.7 | |||||
Average fare - third party products | $ | 5.52 | $ | 4.68 | 17.9 | |||||
Average fare - total | $ | 117.59 | $ | 120.49 | (2.4) | |||||
Average stage length (miles) | 883 | 878 | 0.6 | |||||||
Fuel gallons consumed (thousands) | 70,229 | 97,395 | (27.9) | |||||||
Average fuel cost per gallon | $ | 1.60 | $ | 2.18 | (26.6) | |||||
Percent of sales through website during period | 93.7 | % | 93.5 | % | 0.2 | |||||
Other data: | ||||||||||
Rental car days sold | 616,582 | 1,012,558 | (39.1) | |||||||
Hotel room nights sold | 104,776 | 219,206 | (52.2) |
(1) Except load factor and percent of sales through website, which is percentage point change. |
(2) Various components of this measurement do not have a direct correlation to ASMs. These figures are provided on a per ASM |
(3) Reflects division of passenger revenue between scheduled service and air-related charges in Company's booking path. |
Summary Balance Sheet | ||||||||||
Unaudited (millions) | June 30, 2020 | December 31, | Percent | |||||||
Unrestricted cash and investments | ||||||||||
Cash and cash equivalents | $ | 272.2 | $ | 121.9 | 123.3 | % | ||||
Short-term investments | 390.9 | 335.9 | 16.4 | |||||||
Long-term investments | — | 15.5 | (100.0) | |||||||
Total unrestricted cash and investments | 663.1 | 473.3 | 40.1 | |||||||
Debt | ||||||||||
Current maturities of long-term debt and finance lease obligations, net of | 227.7 | 173.3 | 31.4 | |||||||
Long-term debt and finance lease obligations, net of current maturities and related costs | 1,273.4 | 1,248.6 | 2.0 | |||||||
Total debt | 1,501.1 | 1,421.9 | 5.6 | |||||||
Total Allegiant Travel Company shareholders' equity | 736.6 | 883.6 | (16.6) |
Summary Cash Flow | ||||||||||
Six Months Ended June 30, | Percent | |||||||||
Unaudited (millions) | 2020 | 2019 | Change | |||||||
Cash provided by operating activities | $ | 276.7 | $ | 277.5 | (0.3) | % | ||||
Changes in air traffic liability | 104.8 | 54.8 | 91.2 | |||||||
Changes in working capital, ex air traffic liability | (134.1) | (21.3) | 529.6 | |||||||
Purchase of property and equipment, including capitalized interest | 170.7 | 234.5 | (27.2) | |||||||
Cash dividends paid to shareholders | 11.4 | 22.8 | (50.0) | |||||||
Proceeds from the issuance of long-term debt | 175.7 | 770.4 | (77.2) | |||||||
Principal payments on long-term debt & finance lease obligations | 98.2 | 522.6 | (81.2) |
Daily Cash Burn Reconciliation | |||
Daily cash burn defined as cash from operations less debt and rent payments and capital expenditure outflows, excluding | |||
Unaudited (millions) | Three Months Ended | ||
Cash from operations | 170 | ||
Adjustments: | |||
Debt and rent payments | 35 | ||
CARES Act payroll support | 137 | ||
Federal tax refund received for net operating losses | 45 | ||
Rate differential of net operating loss included in net loss | 18 | ||
Capital expenditures, excluding airframes and engines | 17 | ||
Total adjustments | 252 | ||
Adjusted cash burn | (82) | ||
Days in period | 91 | ||
Average daily cash burn | 0.9 |
EPS Calculation | |||||||||||||||
The following table sets forth the computation of net income (loss) per share, on a basic and diluted basis, for the periods | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||
Basic: | |||||||||||||||
Net income (loss) | $ | (93,103) | $ | 70,543 | $ | (126,113) | $ | 127,667 | |||||||
Less income allocated to participating securities | — | (997) | (236) | (1,791) | |||||||||||
Net income (loss) attributable to common stock | $ | (93,103) | $ | 69,546 | $ | (126,349) | $ | 125,876 | |||||||
Earnings (loss) per share, basic | $ | (5.85) | $ | 4.33 | $ | (7.93) | $ | 7.85 | |||||||
Weighted-average shares outstanding | 15,902 | 16,063 | 15,927 | 16,037 | |||||||||||
Diluted: | |||||||||||||||
Net income (loss) | $ | (93,103) | $ | 70,543 | $ | (126,113) | $ | 127,667 | |||||||
Less income allocated to participating securities | — | (996) | (236) | (1,790) | |||||||||||
Net income (loss) attributable to common stock | $ | (93,103) | $ | 69,547 | $ | (126,349) | $ | 125,877 | |||||||
Earnings (loss) per share, diluted | $ | (5.85) | $ | 4.33 | $ | (7.93) | $ | 7.84 | |||||||
Weighted-average shares outstanding | 15,902 | 16,063 | 15,927 | 16,037 | |||||||||||
Dilutive effect of stock options and restricted stock | 26 | 39 | 56 | 39 | |||||||||||
Adjusted weighted-average shares outstanding under treasury stock method | 15,928 | 16,102 | 15,983 | 16,076 | |||||||||||
Participating securities excluded under two-class method | (26) | (33) | (56) | (26) | |||||||||||
Adjusted weighted-average shares outstanding under two-class method | 15,902 | 16,069 | 15,927 | 16,050 |
Appendix A
Non-GAAP Presentation
Three and Six Months Ended June 30, 2020 and 2019
(Unaudited)
Adjusted operating income, adjusted income before income taxes, adjusted net income and adjusted diluted earnings per share (also referred to as consolidated fully diluted loss per share, excluding COVID related special charges and benefit from the CARES Act), all eliminate the effect of special expenses, related directly to COVID 19, as well as the benefit related to the payroll support grant as provided under the CARES Act, which is not reflective of our ongoing operating performance. The adjusted diluted earnings per share also ignores a one-time tax benefit allowed under the CARES Act. As such, all of these are non-GAAP financial measures.
In addition, airline operating revenue, airline operating income, airline income before income taxes, airline net income and airline operating expense all eliminate the effects of non-airline operating activity, which is not reflective of the airline operating performance. Airline earnings before interest, taxes, depreciation and amortization ("Airline EBITDA") eliminates the effects of non-airline operating activity and other items. As such, all of these are non-GAAP financial measures.
EBITDA, as presented in this press release, and the various adjusted and airline only metrics disclosed, are supplemental measures of our performance that are not required by, or presented in accordance with, accounting principles generally accepted in the United States ("GAAP"). They are not measurements of our financial performance under GAAP and should not be considered in isolation or as an alternative to net income or any other performance measures derived in accordance with GAAP or as an alternative to cash flows from operating activities as a measure of our liquidity.
We define "EBITDA" as earnings before interest, taxes, depreciation and amortization. We caution investors that amounts presented in accordance with this definition may not be comparable to similar measures disclosed by other issuers, because not all issuers and analysts calculate EBITDA in the same manner.
We use EBITDA to evaluate our operating performance and liquidity and it is among the primary measures used by management for planning and forecasting of future periods. We believe the presentation of this measure is relevant and useful for investors because it allows investors to view results in a manner similar to the method used by management and makes it easier to compare our results with other companies that have different financing and capital structures. EBITDA has important limitations as an analytical tool. These limitations include the following:
Presented below is a quantitative reconciliation of EBITDA to the most directly comparable GAAP financial performance measure, which we believe is net income. We believe the presentation of EBITDA and the various adjusted and airline only measures are relevant and useful for investors because they allow them to better gauge the performance of the airline and to compare our results to other airlines.
In addition to EBITDA as defined above, we have included a separate EBITDA as defined by certain credit agreements. This measurement of EBITDA adjusts for losses on impairment, Sunseeker calculation of net income/(loss), stock compensation expense, amortization of debt issuance costs, (gain)/loss on disposal of assets, tax provision - in excess of cash paid, and special non-recurring items.
The SEC has adopted rules (Regulation G) regulating the use of non-GAAP financial measures. Because of our use of non-GAAP financial measures in this press release to supplement our consolidated financial statements presented on a GAAP basis, Regulation G requires us to include in this press release a presentation of the most directly comparable GAAP measure, which is operating revenue, operating income, net income, operating expenses, and diluted earnings per share and a reconciliation of the non-GAAP measures to the most comparable GAAP measure. Our utilization of non-GAAP measurements is not meant to be considered in isolation or as a substitute for operating income, net income or other measures of financial performance prepared in accordance with GAAP. Our use of these non-GAAP measures may not be comparable to similarly titled measures employed by other companies in the airline and travel industry. The reconciliation of each of these measures to the most comparable GAAP measure for the periods is indicated below.
Reconciliation of Non-GAAP Financial Measures | |||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||
Reconciliation of adjusted operating income (loss) | |||||||||||||||
Operating income (loss) as reported (GAAP) | $ | (113.3) | $ | 108.1 | $ | (224.3) | $ | 199.2 | |||||||
CARES Act grant recognition | (74.5) | — | (74.5) | — | |||||||||||
Special charges (operating): | |||||||||||||||
COVID-19 related expenses | 76.2 | — | 85.7 | — | |||||||||||
Impairment of assets (non-cash) | 5.0 | — | 161.6 | — | |||||||||||
Adjusted operating income (loss) (1) | (106.6) | 108.1 | (51.5) | 199.2 | |||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||
Reconciliation of adjusted income (loss) before | |||||||||||||||
Income (loss) before income taxes as reported (GAAP) | $ | (146.4) | $ | 91.8 | $ | (277.1) | $ | 165.7 | |||||||
CARES Act grant recognition | (74.5) | — | (74.5) | — | |||||||||||
Special charges: | |||||||||||||||
COVID-19 related expenses | 96.0 | — | 105.5 | — | |||||||||||
Impairment of assets (non-cash) | 5.0 | — | 168.4 | — | |||||||||||
Adjusted income (loss) before income taxes (1)
| (119.9) | 91.8 | (77.7) | 165.7 | |||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||
Reconciliation of adjusted net income (loss) (millions) | |||||||||||||||
Adjusted income (loss) before income taxes (per calculation in previous table) (1) | $ | (119.9) | $ | 91.8 | $ | (77.7) | $ | 165.7 | |||||||
Provision (benefit) for income taxes as reported (GAAP) | (53.3) | 21.3 | (151.0) | 38.0 | |||||||||||
Adjusted provision (benefit) for income taxes (1) (2) | (25.2) | 21.3 | (16.3) | 38.0 | |||||||||||
Net income (loss) adjusted for special items, CARES Act grant, and for tax (1) | (94.7) | 70.5 | (61.4) | 127.7 | |||||||||||
Diluted shares as reported (GAAP) | 15,902 | 16,069 | 15,927 | 16,050 | |||||||||||
Diluted earnings (loss) per share as reported (GAAP) | (5.85) | 4.33 | (7.93) | 7.84 | |||||||||||
Adjusted fully diluted earnings (loss) per share(1) | (5.96) | 4.33 | (3.87) | 7.84 | |||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||
Reconciliation of airline-only operating revenue, | |||||||||||||||
Operating revenue as reported (GAAP) | $ | 133.3 | $ | 491.8 | $ | 542.5 | $ | 943.4 | |||||||
Non-airline operating revenue (1) | 4.3 | 5.0 | 8.8 | 8.3 | |||||||||||
Airline operating revenue (1) | 129.0 | 486.8 | 533.7 | 935.1 | |||||||||||
Operating income (loss) as reported (GAAP) | (113.3) | 108.1 | (224.3) | 199.2 | |||||||||||
Non-airline operating loss (1) | (7.9) | (7.4) | (170.0) | (14.8) | |||||||||||
Airline operating income (loss) (1) | (105.4) | 115.5 | (54.3) | 214.0 | |||||||||||
Airline operating margin | (81.7) | % | 23.7 | % | (10.2) | % | 22.9 | % | |||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||
Reconciliation of adjusted airline CASM and CASM | |||||||||||||||
Airline operating revenue | $ | 129.0 | $ | 486.8 | $ | 533.7 | $ | 935.1 | |||||||
Airline operating income (loss) | (105.4) | 115.5 | (54.3) | 214.0 | |||||||||||
Airline operating expense | 234.4 | 371.3 | 588.0 | 721.1 | |||||||||||
CARES Act grant recognition | (74.5) | — | (74.5) | — | |||||||||||
Airline operating special charges | 75.9 | — | 85.4 | — | |||||||||||
Adjusted airline operating expense | 233.0 | 371.3 | 577.1 | 721.1 | |||||||||||
Fuel expense as reported | 27.4 | 120.0 | 116.2 | 219.7 | |||||||||||
Adjusted airline operating expense excluding fuel | 205.6 | 251.3 | 460.9 | 501.4 | |||||||||||
Available seat miles (ASMs) (thousands) | 2,220,755 | 4,447,066 | 6,288,427 | 8,357,304 | |||||||||||
Airline operating expense per ASM as reported (CASM) | 10.55 | 8.35 | 9.35 | 8.63 | |||||||||||
Adjusted airline operating expense per ASM (CASM) (cents) | 10.49 | 8.35 | 9.18 | 8.63 | |||||||||||
Airline operating CASM, excluding fuel as reported (cents) | 9.32 | 5.65 | 7.50 | 6.00 | |||||||||||
Adjusted airline operating CASM, excluding fuel (cents) | 9.26 | 5.65 | 7.33 | 6.00 | |||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||
Reconciliation of consolidated EBITDA to EBITDA as | |||||||||||||||
Net income (loss) | $ | (93.1) | $ | 70.5 | $ | (126.1) | $ | 127.7 | |||||||
Interest expense, net | 12.6 | 16.4 | 24.4 | 29.8 | |||||||||||
Income tax provision (benefit) | (53.3) | 21.2 | (151.0) | 38.0 | |||||||||||
Depreciation and amortization | 43.3 | 38.5 | 87.0 | 74.7 | |||||||||||
Loss on debt extinguishment | — | — | 1.2 | 3.7 | |||||||||||
Consolidated EBITDA (1) | (90.5) | 146.6 | (164.5) | 273.9 | |||||||||||
Average number of aircraft in service (#) | 90.7 | 85.0 | 92.1 | 82.3 | |||||||||||
EBITDA per aircraft | (1.0) | 1.7 | (1.8) | 3.3 | |||||||||||
Consolidated EBITDA (1) | (90.5) | 146.6 | (164.5) | 273.9 | |||||||||||
Adjusting items (3) | 223.6 | 3.9 | 528.0 | 4.5 | |||||||||||
EBITDA as defined by certain credit agreements (1) | 133.1 | 150.5 | 363.5 | 278.4 |
(1) Denotes non-GAAP figure. |
(2) Adjusted income tax for 2020 utilizes a 21.0% effective rate |
(3) Adjusting items includes the following: loss on impairment, Sunseeker net income/(loss), stock compensation expense, amortization of debt issuance costs, (gain)/loss on disposal of assets, tax provision - in excess of cash paid, cash refunds to customers, and other special non-recurring items. |
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SOURCE Allegiant Travel Company
Copyright 2020 PR Newswire
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