HONOLULU, April 23,
2024 /PRNewswire/ -- Hawaiian Holdings, Inc.
(NASDAQ: HA) (the "Company"), parent company of Hawaiian
Airlines, Inc. ("Hawaiian"), today reported its financial
results for the first quarter of 2024.
"Mahalo to our team for remaining focused on delivering strong
operational performance and unparalleled guest experience," said
Hawaiian Airlines President and CEO Peter
Ingram. "2024 is off to a positive start as we work to start
realizing the return on significant investments we've made in our
business, including rolling out high-speed Starlink WIFI and taking
delivery of our first Boeing 787."
First
Quarter 2024- Key Financial Metrics and
Results
|
|
|
GAAP
|
|
YoY
Change
|
|
Adjusted
(a)
|
|
YoY
Change
|
Net
Loss
|
|
($137.6M)
|
|
($39.3M)
|
|
($143.5M)
|
|
($31.7M)
|
Diluted
EPS
|
|
($2.65)
|
|
($0.74)
|
|
($2.77)
|
|
($0.60)
|
Pre-tax
Margin
|
|
(23.7) %
|
|
(3.2) pts.
|
|
(24.8) %
|
|
(1.8) pts.
|
EBITDA
|
|
($109.0M)
|
|
($20.8M)
|
|
($116.0M)
|
|
($12.6M)
|
Operating Cost per
ASM
|
|
15.72¢
|
|
5.9 %
|
|
11.82¢
|
|
7.1 %
|
Operating Revenue
per ASM
|
|
12.78¢
|
|
2.6 %
|
|
N/A
|
|
N/A
|
|
(a) See Table 4 for a
reconciliation of adjusted net loss, adjusted diluted EPS, adjusted
pre-tax margin, adjusted EBITDA, and adjusted operating cost per
ASM (CASM excluding fuel and non-recurring items) to each of their
respective most directly comparable GAAP financial
measure.
|
The first quarter loss per share includes ($0.32) per share due to the reduction in the
Company's effective tax rate from 21% to 10%. As of 3/31/2024, the
Company has generated federal and state net operating losses (NOLs)
of approximately $451 million and
$969 million, respectively, which
will be used to reduce future cash tax obligations. Analysis under
GAAP required us to increase the valuation allowance related to the
NOLs which resulted in a lower effective tax rate for the period,
decreasing our GAAP tax benefit.
Statistical data, as well as a reconciliation of the reported
non-GAAP financial measures, can be found in the accompanying
tables.
First Quarter 2024 Highlights
Merger Update
- The Company's stockholders voted in favor of the merger with
Alaska Air Group, Inc. ("Alaska")
- The Company and Alaska entered
into a timing agreement with the Department of Justice ("DOJ") in
which they agreed not to consummate the merger before 90 days
following the date on which both parties have certified substantial
compliance with the DOJ's second request for additional
information
Liquidity and Capital Resources
As of March 31, 2024, the Company had:
- Unrestricted cash, cash equivalents and short-term investments
of $897 million
- Liquidity of $1.15 billion,
including an undrawn revolving credit facility of $235 million
- Outstanding debt and finance lease obligations of $1.75 billion
Routes and Network
- Began Boeing 787-9 Dreamliner revenue service on April 15, 2024
- Announced new flying from Salt Lake
City (SLC) to Honolulu
(HNL) and Sacramento (SMF) to
Lihu`e (LIH) and Kona (KOA)
- Announced increased summer flights between HNL and Austin (AUS), Boston (BOS), Las
Vegas (LAS) and Pago Pago
(PPG)
- Hawaiian will also add a fourth daily flight between HNL and
Los Angeles (LAX) from
May 24 through September 2
- Hawaiian received its second A330-300 freighter from Amazon
which will operate between New
York's JFK and San
Bernardino (SBD)
Guest Experience
- Starlink inflight connectivity is now available free of charge
on board all 18 A321neo aircraft
- Expanded Premium Airport Service product in its Honolulu hub, offering seamless
curb-to-aircraft experience with access to new airport private
suite, Apt. 1929
- Signed a multi-year distribution agreement with Sabre that will
provide Sabre-connected agencies with long-term access to the
carrier's HA Connect™ NDC and traditional EDIFACT content through
the Sabre travel marketplace.
Workforce Development
- Partnered with Universal Technical
Institute, the transportation, skilled trades and energy
education division of UTI, Inc. to expand career opportunities
for Universal Technical Institute
airframe and powerplant graduates who earn their FAA
certifications.
Second Quarter 2024 Outlook
The table below summarizes the Company's expectations for the
quarter ending June 30, 2024
expressed as an expected percentage change compared to the results
for the quarter ended June 30, 2023.
Figures include the expected impacts of the Company's freighter
operation, which are not yet expected to be material.
Item
|
|
GAAP Second Quarter
2024 Guidance
|
|
Non-GAAP
Equivalent
|
|
Non-GAAP Second
Quarter 2024 Guidance
|
Available Seat Miles
(ASMs)
|
|
Up 3.5% to up
6.5%
|
|
|
|
|
Operating Revenue
per ASM (RASM)
|
|
Down 1.5% to up
1.5%
|
|
|
|
|
Costs per ASM
(CASM)
|
|
Up 8.4% to up
10.7%
|
|
CASM excluding fuel and
non-recurring items (a)
|
|
Up 5.0% to up
8.0%
|
Gallons of Jet Fuel
Consumed (b)
|
|
Up 2.5% to up
5.5%
|
|
|
|
|
Average fuel price
per gallon, including taxes and delivery (c)
|
|
$2.83
|
|
Economic Fuel Price per
Gallon (a)(b)(c)
|
|
$2.85
|
Effective Tax
Rate
|
|
~10%
|
|
|
|
|
Full Year 2024 Outlook
The table below summarizes the Company's updated expectations
for the full year ending December 31,
2024 expressed as an expected percentage change compared to
the results for the year ended December 31,
2023. Figures include the expected impacts of the Company's
freighter operation as the Company establishes its freighter
operation.
Item
|
|
Prior GAAP Full Year
2024 Guidance
|
|
Updated GAAP Full
Year 2024 Guidance
|
|
Non-GAAP
Equivalent
|
|
Prior Non-GAAP Full
Year 2024 Guidance
|
|
Updated Non-GAAP
Full Year 2024 Guidance
|
Available Seat Miles
(ASMs)
|
|
Up 6.0% to up
9.0%
|
|
Up 4.5% to
7.5%
|
|
|
|
|
|
|
Costs per
ASM
|
|
Up 0.7% to up
3.0%
|
|
Up 4.1% to up
6.3%
|
|
CASM excluding fuel and
non-recurring items (a)
|
|
Flat to up
3.0%
|
|
Up 1.0% to up
4.0%
|
Gallons of Jet Fuel
Consumed (b)
|
|
Up 4.0% to up
7.0%
|
|
Up 3.0% to up
6.0%
|
|
|
|
|
|
|
Average fuel price
per gallon, including taxes and delivery (c)
|
|
$2.55
|
|
$2.80
|
|
Economic Fuel Price per
Gallon (a)(b)(c)
|
|
$2.59
|
|
$2.83
|
Capital
Expenditures
|
|
$500M to
$550M
|
|
No change
|
|
|
|
|
|
|
|
(a) See Table 3 and
Table 4 for a reconciliation of CASM excluding fuel and
non-recurring items and economic fuel price per gallon to each of
their respective most directly comparable GAAP financial
measures.
|
(b) Gallons of jet fuel
consumed do not include fuel used in the freighter operation, as
those expenses are pass-through expenses not born by the
Company.
|
(c) Average fuel price
per gallon and economic fuel price per gallon estimates are based
on the April 10, 2024 fuel forward curve.
|
Statistical information, as well as a reconciliation of certain
non-GAAP financial measures, can be found in the accompanying
tables.
Investor Conference Call
Hawaiian Holdings' quarterly results conference call is
scheduled to begin today, April 23, 2024, 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
Now in its 95th year of continuous service, Hawaiian is
Hawaiʻi's biggest and longest-serving airline. Hawaiian offers
approximately 150 daily flights within the Hawaiian Islands, and
nonstop flights between Hawaiʻi and 15 U.S. gateway cities – more
than any other airline – as well as service connecting Honolulu and American Samoa, Australia, Cook
Islands, Japan,
New Zealand, South Korea and Tahiti.
Consumer surveys by Condé Nast Traveler and TripAdvisor have
placed Hawaiian among the top of all domestic airlines serving
Hawaiʻi. The carrier was named Hawaiʻi's best employer by Forbes in
2022 and has topped Travel + Leisure's World's Best list as the No.
1 U.S. airline for the past two years. Hawaiian has also led all
U.S. carriers in on-time performance for 18 consecutive years
(2004-2021) as reported by the U.S. Department of
Transportation.
The airline is committed to connecting people with aloha by
offering complimentary meals for all guests on transpacific routes
and the convenience of no change fees on Main Cabin and Premium
Cabin seats. HawaiianMiles members also enjoy flexibility with
miles that never expire. As Hawai'i's hometown airline, Hawaiian
encourages guests to Travel Pono and experience the islands safely
and respectfully.
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 work to integrate and capture return on significant
investments; expectations for service between Salt Lake City and Honolulu, Sacramento and Lihu`e and Kona, Honolulu and Austin, Boston, Las
Vegas, Los Angeles and
Pago Pago, and freighter service
between New York's JFK and
San Bernardino; statements
regarding our multi-year distribution agreement with Sabre; the
Company's outlook for the quarter ending June 30, 2024 and twelve-months ending
December 31, 2024; statements
regarding the Company's future performance; 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.
The Company is subject to risks, uncertainties and assumptions
that could cause the Company's results to differ materially from
the results expressed or implied by such forward-looking
statements, including the risks, uncertainties and assumptions
discussed from time to time in the Company's 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
March 31,
|
|
|
2024
|
|
2023
|
|
%
Change
|
|
|
(in thousands,
except per share data)
|
Operating
Revenue:
|
|
|
|
|
|
|
Passenger
|
|
$
583,448
|
|
$
548,526
|
|
6.4 %
|
Other
|
|
62,119
|
|
64,077
|
|
(3.1) %
|
Total
|
|
645,567
|
|
612,603
|
|
5.4 %
|
Operating
Expenses:
|
|
|
|
|
|
|
Wages and
benefits
|
|
261,935
|
|
241,933
|
|
8.3 %
|
Aircraft fuel,
including taxes and delivery
|
|
188,778
|
|
197,625
|
|
(4.5) %
|
Maintenance, materials
and repairs
|
|
70,971
|
|
50,287
|
|
41.1 %
|
Aircraft and passenger
servicing
|
|
45,424
|
|
42,532
|
|
6.8 %
|
Depreciation and
amortization
|
|
32,967
|
|
32,667
|
|
0.9 %
|
Aircraft
rent
|
|
29,706
|
|
28,171
|
|
5.4 %
|
Commissions and other
selling
|
|
28,443
|
|
28,238
|
|
0.7 %
|
Other rentals and
landing fees
|
|
43,127
|
|
38,720
|
|
11.4 %
|
Purchased
services
|
|
38,475
|
|
35,072
|
|
9.7 %
|
Special
items
|
|
8,482
|
|
—
|
|
100.0 %
|
Other
|
|
45,905
|
|
34,785
|
|
32.0 %
|
Total
|
|
794,213
|
|
730,030
|
|
8.8 %
|
Operating
Loss
|
|
(148,646)
|
|
(117,427)
|
|
26.6 %
|
Nonoperating Income
(Expense):
|
|
|
|
|
|
|
Interest expense and
amortization of debt discounts and issuance costs
|
|
(24,069)
|
|
(22,880)
|
|
|
Interest
income
|
|
10,021
|
|
16,465
|
|
|
Capitalized
interest
|
|
3,134
|
|
1,458
|
|
|
Losses on fuel
derivatives
|
|
(582)
|
|
(5,065)
|
|
|
Other components of
net periodic benefit cost
|
|
(927)
|
|
(1,494)
|
|
|
Gains on investments,
net
|
|
470
|
|
697
|
|
|
Gains on foreign
debt
|
|
8,519
|
|
2,260
|
|
|
Other, net
|
|
(770)
|
|
155
|
|
|
Total
|
|
(4,204)
|
|
(8,404)
|
|
|
Loss Before Income
Taxes
|
|
(152,850)
|
|
(125,831)
|
|
|
Income tax
benefit
|
|
(15,285)
|
|
(27,574)
|
|
|
Net
Loss
|
|
$
(137,565)
|
|
$
(98,257)
|
|
|
Net Loss Per
Share
|
|
|
|
|
|
|
Basic
|
|
$
(2.65)
|
|
$
(1.91)
|
|
|
Diluted
|
|
$
(2.65)
|
|
$
(1.91)
|
|
|
Weighted Average
Number of Common Stock Shares Outstanding:
|
|
|
|
|
|
|
Basic
|
|
51,838
|
|
51,507
|
|
|
Diluted
|
|
51,838
|
|
51,507
|
|
|
Hawaiian
Holdings, Inc.
Consolidated Balance
Sheet
|
|
|
|
March 31,
2024
(unaudited)
|
|
December 31,
2023
|
|
|
(in thousands,
except shares)
|
ASSETS
|
|
|
|
|
Current
Assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
230,865
|
|
$
153,273
|
Restricted
cash
|
|
17,250
|
|
17,250
|
Short-term
investments
|
|
666,432
|
|
755,224
|
Accounts receivable,
net
|
|
99,117
|
|
105,858
|
Income taxes
receivable
|
|
642
|
|
669
|
Spare parts and
supplies, net
|
|
65,444
|
|
60,115
|
Prepaid expenses and
other
|
|
80,304
|
|
78,551
|
Total
|
|
1,160,054
|
|
1,170,940
|
Property and equipment,
less accumulated depreciation and amortization of $1,160,495 and
$1,150,529 as of March 31, 2024 and December 31, 2023,
respectively
|
|
2,104,442
|
|
2,013,616
|
Other
Assets:
|
|
|
|
|
Assets
held-for-sale
|
|
1,091
|
|
1,135
|
Operating lease
right-of-use assets
|
|
393,769
|
|
413,237
|
Long-term prepayments
and other
|
|
118,057
|
|
121,097
|
Intangible assets,
net
|
|
13,500
|
|
13,500
|
Total
Assets
|
|
$
3,790,913
|
|
$
3,733,525
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
Accounts
payable
|
|
$
214,848
|
|
$
199,223
|
Air traffic liability
and current frequent flyer deferred revenue
|
|
757,855
|
|
633,345
|
Other accrued
liabilities
|
|
165,430
|
|
175,591
|
Current maturities of
long-term debt, less discount
|
|
75,132
|
|
43,857
|
Current maturities of
finance lease obligations
|
|
8,791
|
|
10,053
|
Current maturities of
operating leases
|
|
79,281
|
|
83,332
|
Total
|
|
1,301,337
|
|
1,145,401
|
Long-Term
Debt
|
|
1,612,235
|
|
1,537,152
|
Other Liabilities
and Deferred Credits:
|
|
|
|
|
Noncurrent finance
lease obligations
|
|
56,269
|
|
60,116
|
Noncurrent operating
leases
|
|
283,836
|
|
303,119
|
Accumulated pension
and other post-retirement benefit obligations
|
|
142,367
|
|
140,742
|
Other liabilities and
deferred credits
|
|
78,499
|
|
77,154
|
Noncurrent frequent
flyer deferred revenue
|
|
304,099
|
|
308,502
|
Deferred tax
liability, net
|
|
52,492
|
|
65,914
|
Total
|
|
917,562
|
|
955,547
|
Commitments and
Contingencies
|
|
|
|
|
Shareholders'
Equity:
|
|
|
|
|
Special preferred
stock, $0.01 par value per share, three shares issued and
outstanding as of March 31, 2024 and December 31,
2023
|
|
—
|
|
—
|
Common stock, $0.01
par value per share, 51,848.616 and 51,824,362 shares outstanding
as of March 31, 2024 and December 31, 2023,
respectively
|
|
518
|
|
518
|
Capital in excess of
par value
|
|
294,599
|
|
293,797
|
Accumulated
loss
|
|
(257,303)
|
|
(119,738)
|
Accumulated other
comprehensive loss, net
|
|
(78,035)
|
|
(79,152)
|
Total
|
|
(40,221)
|
|
95,425
|
Total Liabilities
and Shareholders' Equity
|
|
$
3,790,913
|
|
$
3,733,525
|
Hawaiian
Holdings, Inc.
Condensed
Consolidated Statements of Cash Flows (unaudited)
|
|
|
|
Three months ended
March 31,
|
|
|
2024
|
|
2023
|
|
|
(in
thousands)
|
Net cash provided by
Operating Activities
|
|
$
254
|
|
$
118,291
|
Cash flows from
Investing Activities:
|
|
|
|
|
Additions to property
and equipment, including pre-delivery payments
|
|
(127,018)
|
|
(106,215)
|
Proceeds from the
disposition of aircraft and aircraft related equipment
|
|
105
|
|
9,563
|
Purchases of
investments
|
|
(15,824)
|
|
(96,806)
|
Proceeds from sales
and maturities of investments
|
|
109,485
|
|
144,069
|
Net cash used in
investing activities
|
|
(33,252)
|
|
(49,389)
|
Cash flows from
Financing Activities:
|
|
|
|
|
Long-term
borrowings
|
|
131,400
|
|
—
|
Repayments of
long-term debt and finance lease obligations
|
|
(18,760)
|
|
(24,953)
|
Debt issuance costs
and discounts
|
|
(1,849)
|
|
—
|
Payment for taxes
withheld for stock compensation
|
|
(201)
|
|
(1,066)
|
Net cash provided by
(used in) financing activities
|
|
110,590
|
|
(26,019)
|
Net increase in cash
and cash equivalents
|
|
77,592
|
|
42,883
|
Cash, cash
equivalents, and restricted cash - Beginning of
Period
|
|
170,523
|
|
246,620
|
Cash, cash
equivalents, and restricted cash - End of Period
|
|
$
248,115
|
|
$
289,503
|
Table
2.
Hawaiian
Holdings, Inc.
Selected
Consolidated Statistical Data (unaudited)
|
|
|
|
|
|
Three months ended
March 31,
|
|
|
2024
|
|
2023
|
|
%
Change
|
|
|
(in thousands, except as otherwise indicated)
|
Scheduled
Operations:
|
|
|
|
|
|
|
Revenue passengers
flown
|
|
2,620
|
|
2,592
|
|
1.1 %
|
Revenue passenger
miles (RPM)
|
|
4,072,473
|
|
3,844,061
|
|
5.9 %
|
Available seat miles
(ASM)
|
|
5,049,598
|
|
4,914,619
|
|
2.7 %
|
Passenger revenue per
RPM (Yield)
|
|
14.33 ¢
|
|
14.27 ¢
|
|
0.4 %
|
Passenger load factor
(RPM/ASM)
|
|
80.6 %
|
|
78.2 %
|
|
2.4
pts.
|
Passenger revenue per
ASM (PRASM)
|
|
11.55 ¢
|
|
11.16 ¢
|
|
3.5 %
|
Total
Operations:
|
|
|
|
|
|
|
Revenue passengers
flown
|
|
2,621
|
|
2,593
|
|
1.1 %
|
Revenue passenger
miles (RPM)
|
|
4,073,159
|
|
3,845,978
|
|
5.9 %
|
Available seat miles
(ASM)
|
|
5,050,841
|
|
4,917,517
|
|
2.7 %
|
Operating revenue per
ASM (RASM)
|
|
12.78 ¢
|
|
12.46 ¢
|
|
2.6 %
|
Operating cost per ASM
(CASM)
|
|
15.72 ¢
|
|
14.85 ¢
|
|
5.9 %
|
CASM excluding
aircraft fuel and non-recurring items (a)
|
|
11.82 ¢
|
|
11.04 ¢
|
|
7.1 %
|
Aircraft fuel expense
per ASM (b)
|
|
3.74 ¢
|
|
4.02 ¢
|
|
(7.0) %
|
Revenue block hours
operated
|
|
52,141
|
|
52,228
|
|
(0.2) %
|
Gallons of jet fuel
consumed (c)
|
|
67,651
|
|
64,853
|
|
4.3 %
|
Average cost per
gallon of jet fuel (actual) (b)
|
|
$2.79
|
|
$3.05
|
|
(8.5) %
|
|
|
(a)
|
See Table 4 for a
reconciliation of CASM excluding aircraft fuel and non-recurring
items to its most directly comparable GAAP financial
measure..
|
(b)
|
Includes applicable
taxes and fees.
|
(c)
|
Excludes operations
under the ATSA with Amazon.
|
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
March 31,
|
|
|
2024
|
|
2023
|
|
%
Change
|
|
|
(in thousands,
except per-gallon amounts)
|
Aircraft fuel expense,
including taxes and delivery
|
|
$
188,778
|
|
$
197,625
|
|
(4.5) %
|
Realized losses on
settlement of fuel derivative contracts
|
|
2,398
|
|
1,513
|
|
58.5 %
|
Economic fuel
expense
|
|
$
191,176
|
|
$
199,138
|
|
(4.0) %
|
Fuel gallons
consumed
|
|
67,651
|
|
64,853
|
|
4.3 %
|
Economic fuel price per
gallon
|
|
$
2.83
|
|
$
3.07
|
|
(7.8) %
|
|
|
|
Estimated three
months ending June 30, 2024
|
|
Estimated full year
ending December 31, 2024
|
|
|
(in thousands,
except per-gallon amounts)
|
Aircraft fuel expense,
including taxes and delivery
|
|
$
192,675
|
-
|
$
198,314
|
|
$
772,335
|
-
|
$
794,830
|
Realized losses on
settlement of fuel derivative contracts
|
|
1,456
|
-
|
1,456
|
|
6,431
|
-
|
6,431
|
Economic fuel
expense
|
|
$
194,131
|
-
|
$
199,770
|
|
$
778,766
|
-
|
$
801,261
|
Fuel gallons
consumed
|
|
68,032
|
-
|
70,024
|
|
275,377
|
|
283,398
|
Economic fuel price per
gallon
|
|
$
2.85
|
-
|
$
2.85
|
|
$
2.83
|
-
|
$
2.83
|
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 adjusted
net loss, adjusted diluted EPS, adjusted pre-tax margin, adjusted
EBITDA, and adjusted operating cost per ASM (CASM excluding fuel
and non-recurring items). 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:
- CBA related expense. In February
2023, pilots represented by the Air Line Pilots Association
(ALPA) ratified a new four-year CBA, which included, amongst other
things, a signing bonus, pay scale increases across all fleet
types, improved health benefits and cost sharing, and enhancements
to the Company's postretirement and disability plans. In connection
with the ratification, the Company recorded a signing bonus and
vacation liability true-up of $17.7
million which were recorded in wages and benefits during the
quarter ended March 31, 2023.
- Contract termination amortization. In
December 2022, the Company entered
into a Memorandum of Understanding (MOU) with one of its
third-party service providers to early terminate its Amended and
Restated Complete Fleet Services Agreement (Amended CFS) covering
A330-200 aircraft. The Amended CFS was originally scheduled to run
through December 2027, but was
terminated in April 2023. During the
three months ended March 31, 2023,
the Company recognized approximately $18.1
million in amortization within Maintenance, materials and
repairs in the Consolidated Statements of Operations.
- Special items. During the three months ended
March 31, 2024, the Company recorded
$8.5 million in Special items as a
result of expenses related to its merger with Alaska, primarily consisting of legal,
advisory, and other fees.
- Gain on sale of commercial real estate. In
February 2023, the Company entered
into an agreement for the sale of its commercial real estate and
recognized a gain on sale of $10.2
million, which was recorded in Other operating expense in
the Consolidated Statements of Operations.
- Interest income on federal tax refund. In March 2023, the Company received $4.7 million in interest income in connection
with a $66.8 million federal tax
refund received related to fiscal year 2018. The interest income
received was recorded in Interest income in the Consolidated
Statements of Operations.
- Changes in fair value of fuel derivative contracts.
Changes in fair value of fuel derivative contracts, net of tax, are
based on market prices for open contracts as of the end of the
reporting period and include 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 gain on foreign debt. Unrealized gain
on foreign debt is based on fluctuation in exchange rates and the
measurement of foreign-denominated debt to the Company's functional
currency.
- Unrealized gain on equity securities. Unrealized gain on
equity securities is driven by changes in market prices and
currency fluctuations, which is recorded in Other nonoperating
expense in the Consolidated Statements of Operations.
The Company believes that adjusting for the impact of the
changes in fair value of equity securities and fuel derivative
contracts, fluctuations in exchange rates on debt instruments
denominated in foreign currency, and non-recurring expenses and
income/gains (including CBA-related, contract termination
amortization, special items, interest income on federal tax refund,
gain or loss on sale of aircraft, and gain on sale of commercial
real estate), helps investors better analyze the Company's
operational performance and compare its results to other airlines
in the periods presented.
|
|
Three months ended
March 31,
|
|
|
2024
|
|
2023
|
|
|
Total
|
|
Diluted Net Loss Per
Share
|
|
Total
|
|
Diluted Net Loss Per
Share
|
|
|
(in thousands,
except per share data)
|
Net Loss, as
reported
|
|
$
(137,565)
|
|
$
(2.65)
|
|
$
(98,257)
|
|
$
(1.91)
|
Adjusted
for:
|
|
|
|
|
|
|
|
|
CBA related
expense
|
|
—
|
|
—
|
|
17,727
|
|
0.35
|
Contract termination
amortization
|
|
—
|
|
—
|
|
(18,114)
|
|
(0.35)
|
Special
items
|
|
8,482
|
|
0.16
|
|
—
|
|
—
|
Gain on sale of
commercial real estate
|
|
—
|
|
—
|
|
(10,179)
|
|
(0.20)
|
Interest income on
federal tax refund
|
|
—
|
|
—
|
|
(4,672)
|
|
(0.09)
|
Changes in fair value
of fuel derivative contracts
|
|
(1,816)
|
|
(0.04)
|
|
3,552
|
|
0.07
|
Unrealized gain on
foreign debt
|
|
(8,555)
|
|
(0.17)
|
|
(2,488)
|
|
(0.05)
|
Unrealized gain on
equity securities
|
|
(5,115)
|
|
(0.10)
|
|
(944)
|
|
(0.02)
|
Tax effect of
adjustments
|
|
1,037
|
|
0.03
|
|
1,568
|
|
0.03
|
Adjusted net
loss
|
|
$
(143,532)
|
|
$
(2.77)
|
|
$
(111,807)
|
|
$
(2.17)
|
Adjusted EBITDA
The Company believes that adjusting earnings for interest,
taxes, depreciation and amortization, non-recurring operating
expenses (such as changes in unrealized gains and losses on
financial instruments) and one-time charges helps investors better
analyze the Company's financial performance by allowing for
company-to-company and period-over-period comparisons that are
unaffected by company-specific or one-time occurrences.
The Company reclassified prior period EBITDA and Adjusted EBITDA
to conform to the current period presentation.
|
|
Three months ended
March 31,
|
|
|
2024
|
|
2023
|
|
|
(in
thousands)
|
Net Loss
|
|
$
(137,565)
|
|
$
(98,257)
|
Income tax
benefit
|
|
(15,285)
|
|
(27,574)
|
Depreciation and
amortization
|
|
32,967
|
|
32,667
|
Interest expense and
amortization of debt discounts and issuance costs
|
|
24,069
|
|
22,880
|
Interest
income
|
|
(10,021)
|
|
(16,465)
|
Capitalized
interest
|
|
(3,134)
|
|
(1,458)
|
EBITDA, as
reported
|
|
(108,969)
|
|
(88,207)
|
Adjusted
for:
|
|
|
|
|
CBA related
expense
|
|
—
|
|
17,727
|
Contract termination
amortization
|
|
—
|
|
(18,114)
|
Special
items
|
|
8,482
|
|
—
|
Gain on sale of
commercial real estate
|
|
—
|
|
(10,179)
|
Interest income on tax
refund
|
|
—
|
|
(4,672)
|
Changes in fair value
of fuel derivative instruments
|
|
(1,816)
|
|
3,552
|
Unrealized gain on
foreign debt
|
|
(8,555)
|
|
(2,488)
|
Unrealized gain on
equity securities
|
|
(5,115)
|
|
(944)
|
Adjusted
EBITDA
|
|
$
(115,973)
|
|
$
(103,325)
|
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
March 31,
|
|
|
2024
|
|
2023
|
|
|
(in thousands,
except CASM data)
|
GAAP Operating
Expenses
|
|
$
794,213
|
|
$
730,030
|
Adjusted
for:
|
|
|
|
|
CBA related
expense
|
|
—
|
|
(17,727)
|
Contract termination
amortization
|
|
—
|
|
18,114
|
Special
items
|
|
(8,482)
|
|
—
|
Gain on sale of
commercial real estate
|
|
—
|
|
10,179
|
Operating Expenses
excluding non-recurring items
|
|
$
785,731
|
|
$
740,596
|
Aircraft fuel,
including taxes and delivery
|
|
(188,778)
|
|
(197,625)
|
Operating Expenses
excluding fuel and non-recurring items
|
|
$
596,953
|
|
$
542,971
|
Available Seat
Miles
|
|
5,050,841
|
|
4,917,517
|
CASM - GAAP
|
|
15.72 ¢
|
|
14.85 ¢
|
Aircraft fuel,
including taxes and delivery
|
|
(3.74)
|
|
(4.02)
|
CBA related
expense
|
|
—
|
|
(0.36)
|
Contract termination
amortization
|
|
—
|
|
0.37
|
Special
items
|
|
(0.16)
|
|
—
|
Gain on sale of
commercial real estate
|
|
—
|
|
0.20
|
CASM excluding fuel and
non-recurring items
|
|
11.82 ¢
|
|
11.04 ¢
|
|
|
Estimated three
months ending June 30, 2024
|
|
Estimated year
ending December 31, 2024
|
|
|
(in thousands,
except CASM data)
|
GAAP operating
expenses
|
|
$
803,834
|
-
|
$
844,733
|
|
$
3,273,023
|
-
|
$
3,438,253
|
Aircraft fuel,
including taxes and delivery
|
|
(192,675)
|
-
|
(198,314)
|
|
(772,335)
|
-
|
(794,830)
|
Less: non recurring
items
|
|
(7,245)
|
-
|
(7,245)
|
|
(92,229)
|
-
|
(92,229)
|
Adjusted operating
expenses
|
|
$
603,914
|
-
|
$
639,174
|
|
$
2,408,459
|
-
|
$
2,551,194
|
Available seat
miles
|
|
5,189,938
|
-
|
5,340,371
|
|
21,113,699
|
-
|
21,719,834
|
CASM - GAAP
|
|
15.49 ¢
|
-
|
15.82 ¢
|
|
15.50 ¢
|
-
|
15.83 ¢
|
Aircraft fuel,
including taxes and delivery
|
|
(3.71)
|
-
|
(3.71)
|
|
(3.66)
|
-
|
(3.66)
|
Non-recurring
items
|
|
(0.14)
|
-
|
(0.14)
|
|
(0.44)
|
-
|
(0.42)
|
CASM excluding fuel and
non-recurring items
|
|
11.64 ¢
|
-
|
11.97 ¢
|
|
11.40 ¢
|
-
|
11.75 ¢
|
Pre-tax margin
The Company excludes changes in fair value of equity securities
and fuel derivative contracts, fluctuations and exchange rates on
debt instruments denominated in foreign currency, and non-recurring
items from pre-tax margin for the same reasons as described
above.
|
|
Three months ended
March 31,
|
|
|
2024
|
|
2023
|
Pre-Tax Margin, as
reported
|
|
(23.7) %
|
|
(20.5) %
|
CBA ratification
bonus
|
|
—
|
|
2.9
|
Contract termination
amortization
|
|
—
|
|
(3.0)
|
Special
items
|
|
1.3
|
|
—
|
Gain on sale of
commercial real estate
|
|
—
|
|
(1.7)
|
Interest income on
federal tax refund
|
|
—
|
|
(0.8)
|
Changes in fair value
of fuel derivative contracts
|
|
(0.3)
|
|
0.6
|
Unrealized gain on
foreign debt
|
|
(1.3)
|
|
(0.4)
|
Unrealized (gain) loss
on equity securities
|
|
(0.8)
|
|
(0.1)
|
Adjusted Pre-Tax
Margin
|
|
(24.8) %
|
|
(23.0) %
|
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SOURCE Hawaiian Holdings, Inc.