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Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
Unaudited | 2018 | 2017 | Change | 2018 | 2017 | Change | |||||||||||
Total operating revenue (millions) | $ | 393.1 | $ | 350.2 | 12.3 | % | $ | 1,255.3 | $ | 1,132.0 | 10.9 | % | |||||
Operating income (millions) | 26.2 | 44.3 | (41.0 | ) | 180.4 | 203.9 | (11.5 | ) | |||||||||
Net income (millions) | 15.1 | 23.4 | (35.2 | ) | 120.4 | 114.8 | 4.9 | ||||||||||
Diluted earnings per share | $ | 0.94 | $ | 1.45 | (35.2 | ) | $ | 7.45 | $ | 6.99 | 6.6 |
1. | We will have purchased and inducted 43 Airbus aircraft, while retiring 47 MDs. We will have trained more than 350 Airbus pilots and 300 maintenance technicians as well as our flight attendants, ground staff and other operations personnel by the time we fly the final MD-80 flight at the end of November. |
2. | We have grown the Company 20 percent in capacity (ASMs), adding 51 routes and carrying 13.6 million passengers during the last twelve months, an increase of 1.64 million passengers over 2016. |
3. | We have dramatically improved our operations. Since last October, we have led the industry in monthly completion factor six times and have been among the top three except for a few months. Our on-time performance is improving nicely as well; this September we were up ten percentage points in A14, from 72 percent to 82 percent. |
• | 2018 shareholder returns - over $33 million in the first three quarters of the year through dividends |
◦ | Will pay dividends of $0.70 per share on December 5, 2018 to shareholders of record as of November 23, 2018 |
• | Fourth quarter scheduled and system ASMs are expected to grow between four and six percent vs last year |
◦ | The remaining MD-80s will be retired immediately after the Thanksgiving travel period |
• | 2018 full year ASM growth is expected to be between 9.5 and 10.5 percent |
• | 2018 full year tax rate is expected to be between 18 and 19 percent |
• | 2018 full year average fuel cost is expected to be $2.38 per gallon using the forward curve as of October 23, 2018 |
• | Due to several one-time maintenance events, 2018 maintenance per aircraft per month is expected to be between $90 and $95 thousand |
• | 2018 EPS is expected to be between $9 and $10 per share even with the higher than expected fuel cost |
Guidance, subject to revision | |||
Full year 2018 guidance | Previous* | Current | |
Fuel cost per gallon | $2.35 | $2.38 | |
Available seat miles (ASMs) / gallon | 77.5 to 78.5 | 77.5 to 78.5 | |
Interest expense (millions) | $50 to $60 | $50 to $60 | |
Tax rate | 21 to 22% | 18 to 19% | |
Share count (millions) | 15.9 | 15.9 | |
Earnings per share | $9 to $10 | $9 to $10 | |
System ASMs - year over year change | 9 to 11% | 9.5 to 10.5% | |
Scheduled service ASMs - year over year change | 9 to 11% | 9.5 to 10.5% | |
Depreciation expense / aircraft / month (thousands) | $115 to $120 | $115 to $120 | |
Maintenance expense / aircraft / month (thousands) | $80 to $85 | $90 to $95 | |
Full year 2018 CAPEX guidance | |||
Capital expenditures (millions) ** | $300 | $300 | |
Capitalized Airbus deferred heavy maintenance (millions) *** | $45 | $45 | |
Sunseeker CAPEX | |||
2018 year to date (millions) | $15 | ||
Project since inception (millions) | $46 |
Aircraft fleet plan by end of period | |||||||||
Aircraft - (seats per AC) | 1Q18 | 2Q18 | 3Q18 | YE18 | |||||
MD-80 (166 seats) | 32 | 27 | 19 | — | |||||
A319 (156 seats) | 26 | 31 | 31 | 32 | |||||
A320 (177/186 seats) | 30 | 35 | 43 | 44 | |||||
Total | 88 | 93 | 93 | 76 |
Adjusted CASM ex fuel | Three Months Ended September 30, | |||||||||
2018 | 2017 | Change | ||||||||
CASM (cents) | 10.07 | 9.50 | 6.0 | % | ||||||
Adjusted for: | ||||||||||
Aircraft fuel | 3.12 | 2.50 | 24.8 | |||||||
Non-airline | 0.16 | 0.08 | 100.0 | |||||||
Adjusted CASM ex | 6.79 | 6.92 | (1.9 | ) | ||||||
Non-airline revenue (millions) | $ | 2.7 | $ | 1.7 | 58.8 |
Adjusted CASM ex fuel | Nine Months Ended September 30, | |||||||||
2018 | 2017 | Change | ||||||||
CASM (cents) | 9.52 | 9.12 | 4.4 | % | ||||||
Adjusted for: | ||||||||||
Aircraft fuel | 3.03 | 2.46 | 23.2 | |||||||
Non-airline | 0.11 | 0.07 | 57.1 | |||||||
Adjusted CASM ex | 6.38 | 6.59 | (3.2 | ) | ||||||
Non-airline revenue (millions) | $ | 6.0 | $ | 3.4 | 76.5 |
Three Months Ended September 30, | Percent | |||||||||
2018 | 2017 | change | ||||||||
OPERATING REVENUE: | ||||||||||
Passenger revenue (1) | $ | 355,100 | $ | 315,308 | 12.6 | |||||
Third party products | 15,921 | 12,348 | 28.9 | |||||||
Fixed fee contract revenue | 14,791 | 11,831 | 25.0 | |||||||
Other revenue | 7,297 | 10,708 | (31.9 | ) | ||||||
Total operating revenue | 393,109 | 350,195 | 12.3 | |||||||
OPERATING EXPENSES: | ||||||||||
Aircraft fuel | 113,525 | 80,421 | 41.2 | |||||||
Salary and benefits | 97,706 | 88,788 | 10.0 | |||||||
Station operations | 43,128 | 37,148 | 16.1 | |||||||
Maintenance and repairs | 31,983 | 28,870 | 10.8 | |||||||
Depreciation and amortization | 34,658 | 31,894 | 8.7 | |||||||
Sales and marketing | 16,798 | 13,884 | 21.0 | |||||||
Aircraft lease rentals | 671 | 533 | 25.9 | |||||||
Other | 28,459 | 24,315 | 17.0 | |||||||
Total operating expense | 366,928 | 305,853 | 20.0 | |||||||
OPERATING INCOME | 26,181 | 44,342 | (41.0 | ) | ||||||
OTHER (INCOME) EXPENSE: | ||||||||||
Interest expense | 14,309 | 10,041 | 42.5 | |||||||
Interest income | (2,425 | ) | (1,454 | ) | 66.8 | |||||
Other, net | (118 | ) | (400 | ) | (70.5 | ) | ||||
Total other expense | 11,766 | 8,187 | 43.7 | |||||||
INCOME BEFORE INCOME TAXES | 14,415 | 36,155 | (60.1 | ) | ||||||
PROVISION FOR INCOME TAXES | (732 | ) | 12,771 | NM | ||||||
NET INCOME | $ | 15,147 | $ | 23,384 | (35.2 | ) | ||||
Earnings per share to common shareholders (2): | ||||||||||
Basic | $0.94 | $1.45 | (35.2 | ) | ||||||
Diluted | $0.94 | $1.45 | (35.2 | ) | ||||||
Weighted average shares outstanding used in computing earnings per share to common shareholders (2): | ||||||||||
Basic | 15,957 | 15,852 | 0.7 | |||||||
Diluted | 15,962 | 15,862 | 0.6 |
Three Months Ended September 30, | Percent | |||||||||
2018 | 2017 | change (1) | ||||||||
OPERATING STATISTICS | ||||||||||
Total system statistics: | ||||||||||
Passengers | 3,503,849 | 3,045,642 | 15.0 | |||||||
Revenue passenger miles (RPMs) (thousands) | 3,037,540 | 2,672,963 | 13.6 | |||||||
Available seat miles (ASMs) (thousands) | 3,643,948 | 3,220,246 | 13.2 | |||||||
Load factor | 83.4 | % | 83.0 | % | 0.4 | |||||
Operating expense per ASM (CASM) (cents) | 10.07 | 9.50 | 6.0 | |||||||
Fuel expense per ASM (cents) | 3.12 | 2.50 | 24.8 | |||||||
Operating CASM, excluding fuel (cents) | 6.95 | 7.00 | (0.7 | ) | ||||||
ASMs per gallon of fuel | 77.5 | 72.6 | 6.7 | |||||||
Departures | 25,601 | 22,723 | 12.7 | |||||||
Block hours | 56,329 | 49,932 | 12.8 | |||||||
Average stage length (miles) | 838 | 842 | (0.5 | ) | ||||||
Average number of operating aircraft during period | 95.6 | 89.7 | 6.6 | |||||||
Average block hours per aircraft per day | 6.4 | 6.1 | 4.9 | |||||||
Full-time equivalent employees at end of period | 3,835 | 3,704 | 3.5 | |||||||
Fuel gallons consumed (thousands) | 47,016 | 44,346 | 6.0 | |||||||
Average fuel cost per gallon | $ | 2.41 | $ | 1.81 | 33.1 | |||||
Scheduled service statistics: | ||||||||||
Passengers | 3,461,267 | 2,998,476 | 15.4 | |||||||
Revenue passenger miles (RPMs) (thousands) | 2,988,962 | 2,618,446 | 14.2 | |||||||
Available seat miles (ASMs) (thousands) | 3,485,800 | 3,073,360 | 13.4 | |||||||
Load factor | 85.7 | % | 85.2 | % | 0.5 | |||||
Departures | 24,281 | 21,498 | 12.9 | |||||||
Block hours | 53,723 | 47,481 | 13.1 | |||||||
Total passenger revenue per ASM (TRASM) (cents) (2) | 10.64 | 10.66 | (0.2 | ) | ||||||
Average fare - scheduled service (3) | $ | 59.23 | $ | 61.34 | (3.4 | ) | ||||
Average fare - air-related charges (3) | $ | 43.36 | $ | 43.81 | (1.0 | ) | ||||
Average fare - third party products | $ | 4.60 | $ | 4.12 | 11.7 | |||||
Average fare - total | $ | 107.19 | $ | 109.27 | (1.9 | ) | ||||
Average stage length (miles) | 845 | 849 | (0.5 | ) | ||||||
Fuel gallons consumed (thousands) | 44,910 | 42,193 | 6.4 | |||||||
Average fuel cost per gallon | $ | 2.41 | $ | 1.80 | 33.9 | |||||
Percent of sales through website during period | 93.7 | % | 93.3 | % | 0.4 |
Nine Months Ended September 30, | Percent | |||||||||
2018 | 2017 | change | ||||||||
OPERATING REVENUE: | ||||||||||
Passenger Revenue (1) | $ | 1,157,443 | $ | 1,030,395 | 12.3 | |||||
Third party products | 44,045 | 39,394 | 11.8 | |||||||
Fixed fee contract revenue | 33,000 | 34,120 | (3.3 | ) | ||||||
Other revenue | 20,845 | 28,140 | (25.9 | ) | ||||||
Total operating revenue | 1,255,333 | 1,132,049 | 10.9 | |||||||
OPERATING EXPENSES: | ||||||||||
Aircraft fuel | 342,006 | 250,470 | 36.5 | |||||||
Salary and benefits | 312,314 | 277,307 | 12.6 | |||||||
Station operations | 122,265 | 107,979 | 13.2 | |||||||
Maintenance and repairs | 75,864 | 87,611 | (13.4 | ) | ||||||
Depreciation and amortization | 92,641 | 92,571 | 0.1 | |||||||
Sales and marketing | 54,224 | 40,707 | 33.2 | |||||||
Aircraft lease rentals | 767 | 3,098 | (75.2 | ) | ||||||
Other | 74,881 | 68,440 | 9.4 | |||||||
Total operating expense | 1,074,962 | 928,183 | 15.8 | |||||||
OPERATING INCOME | 180,371 | 203,866 | (11.5 | ) | ||||||
OTHER (INCOME) EXPENSE: | ||||||||||
Interest expense | 40,188 | 27,332 | 47.0 | |||||||
Interest income | (6,259 | ) | (4,193 | ) | 49.3 | |||||
Other, net | (408 | ) | (1,254 | ) | (67.5 | ) | ||||
Total other expense | 33,521 | 21,885 | 53.2 | |||||||
INCOME BEFORE INCOME TAXES | 146,850 | 181,981 | (19.3 | ) | ||||||
PROVISION FOR INCOME TAXES | 26,494 | 67,208 | (60.6 | ) | ||||||
NET INCOME | 120,356 | 114,773 | 4.9 | |||||||
Earnings per share to common shareholders (2): | ||||||||||
Basic | $7.46 | $7.00 | 6.6 | |||||||
Diluted | $7.45 | $6.99 | 6.6 | |||||||
Weighted average shares outstanding used in computing earnings per share to common shareholders (2): | ||||||||||
Basic | 15,929 | 16,142 | (1.3 | ) | ||||||
Diluted | 15,938 | 16,160 | (1.4 | ) |
Nine Months Ended September 30, | Percent | |||||||||
2018 | 2017 | change (1) | ||||||||
OPERATING STATISTICS | ||||||||||
Total system statistics: | ||||||||||
Passengers | 10,510,913 | 9,233,083 | 13.8 | |||||||
Revenue passenger miles (RPMs) (thousands) | 9,408,944 | 8,340,269 | 12.8 | |||||||
Available seat miles (ASMs) (thousands) | 11,294,805 | 10,181,292 | 10.9 | |||||||
Load factor | 83.3 | % | 81.9 | % | 1.4 | |||||
Operating expense per ASM (CASM) (cents) | 9.52 | 9.12 | 4.4 | |||||||
Fuel expense per ASM (cents) | 3.03 | 2.46 | 23.2 | |||||||
Operating CASM, excluding fuel (cents) | 6.49 | 6.66 | (2.6 | ) | ||||||
ASMs per gallon of fuel | 76.8 | 72.2 | 6.3 | |||||||
Departures | 76,912 | 69,739 | 10.3 | |||||||
Block hours | 174,838 | 159,181 | 9.8 | |||||||
Average stage length (miles) | 868 | 870 | (0.2 | ) | ||||||
Average number of operating aircraft during period | 92.4 | 86.6 | 6.7 | |||||||
Average block hours per aircraft per day | 6.9 | 6.7 | 3.0 | |||||||
Full-time equivalent employees at end of period | 3,835 | 3,704 | 3.5 | |||||||
Fuel gallons consumed (thousands) | 147,172 | 141,054 | 4.3 | |||||||
Average fuel cost per gallon | $ | 2.32 | $ | 1.78 | 30.3 | |||||
Scheduled service statistics: | ||||||||||
Passengers | 10,422,579 | 9,110,745 | 14.4 | |||||||
Revenue passenger miles (RPMs) (thousands) | 9,299,355 | 8,183,636 | 13.6 | |||||||
Available seat miles (ASMs) (thousands) | 10,883,630 | 9,747,395 | 11.7 | |||||||
Load factor | 85.4 | % | 84.0 | % | 1.4 | |||||
Departures | 73,537 | 66,355 | 10.8 | |||||||
Block hours | 167,947 | 151,988 | 10.5 | |||||||
Total passenger revenue per ASM (TRASM) (cents) (2) | 11.04 | 10.98 | 0.5 | |||||||
Average fare - scheduled service (3) | $ | 65.72 | $ | 68.04 | (3.4 | ) | ||||
Average fare - air-related charges (3) | $ | 45.33 | $ | 45.06 | 0.6 | |||||
Average fare - third party products | $ | 4.23 | $ | 4.32 | (2.1 | ) | ||||
Average fare - total | $ | 115.28 | $ | 117.42 | (1.8 | ) | ||||
Average stage length (miles) | 874 | 875 | (0.1 | ) | ||||||
Fuel gallons consumed (thousands) | 141,452 | 134,906 | 4.9 | |||||||
Average fuel cost per gallon | $ | 2.31 | $ | 1.76 | 31.3 | |||||
Percent of sales through website during period | 93.8 | % | 94.1 | % | (0.3 | ) |
(millions) | 9/30/2018 | 12/31/2017 | Change | |||||||
(unaudited) | ||||||||||
Unrestricted cash | ||||||||||
Cash and cash equivalents | $ | 140.8 | $ | 59.4 | 137.0 | % | ||||
Short-term investments | 284.6 | 352.7 | (19.3 | ) | ||||||
Long-term investments | 53.4 | 78.6 | (32.1 | ) | ||||||
Total unrestricted cash and investments | 478.8 | 490.7 | (2.4 | ) | ||||||
Debt | ||||||||||
Current maturities of long-term debt and capital lease obligations, net of related costs | 654.7 | 214.8 | 204.8 | |||||||
Long-term debt and capital lease obligations, net of current maturities and related costs | 658.4 | 950.1 | (30.7 | ) | ||||||
Total debt | 1,313.1 | 1,164.9 | 12.7 | |||||||
Total Allegiant Travel Company shareholders’ equity | $ | 653.0 | $ | 553.3 | 18.0 | % |
Nine Months Ended September 30, | ||||||||||
Unaudited (millions) | 2018 | 2017 | Change | |||||||
Cash provided by operating activities | $ | 290.1 | $ | 302.1 | (4.0 | )% | ||||
Purchase of property and equipment, including capitalized interest | 274.0 | 333.7 | (17.9 | ) | ||||||
Repurchase of common stock | 3.6 | 90.4 | (96.0 | ) | ||||||
Cash dividends paid to shareholders | 33.9 | 34.5 | (1.7 | ) | ||||||
Proceeds from the issuance of long-term debt | 191.7 | 292.5 | (34.5 | ) | ||||||
Principal payments on long-term debt & capital lease obligations | $ | 171.4 | $ | 88.0 | 94.8 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Basic: | |||||||||||||||
Net income | $ | 15,147 | $ | 23,384 | $ | 120,356 | $ | 114,773 | |||||||
Less net income allocated to participating securities | (194 | ) | (331 | ) | (1,602 | ) | (1,784 | ) | |||||||
Net income attributable to common stock | $ | 14,953 | $ | 23,053 | $ | 118,754 | $ | 112,989 | |||||||
Earnings per share, basic | $ | 0.94 | $ | 1.45 | $ | 7.46 | $ | 7.00 | |||||||
Weighted-average shares outstanding | 15,957 | 15,852 | 15,929 | 16,142 | |||||||||||
Diluted: | |||||||||||||||
Net income | $ | 15,147 | $ | 23,384 | $ | 120,356 | $ | 114,773 | |||||||
Less net income allocated to participating securities | (194 | ) | (330 | ) | (1,601 | ) | (1,782 | ) | |||||||
Net income attributable to common stock | $ | 14,953 | $ | 23,054 | $ | 118,755 | $ | 112,991 | |||||||
Earnings per share, diluted | $ | 0.94 | $ | 1.45 | $ | 7.45 | $ | 6.99 | |||||||
Weighted-average shares outstanding | 15,957 | 15,852 | 15,929 | 16,142 | |||||||||||
Dilutive effect of stock options and restricted stock | 35 | 18 | 42 | 60 | |||||||||||
Adjusted weighted-average shares outstanding under treasury stock method | 15,992 | 15,870 | 15,971 | 16,202 | |||||||||||
Participating securities excluded under two-class method | (30 | ) | (8 | ) | (33 | ) | (42 | ) | |||||||
Adjusted weighted-average shares outstanding under two-class method | 15,962 | 15,862 | 15,938 | 16,160 |
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