HONOLULU, Oct. 24,
2023 /PRNewswire/ -- Hawaiian Holdings, Inc. (NASDAQ:
HA) (the "Company"), parent company of Hawaiian Airlines, Inc.
("Hawaiian"), today reported its financial results for the third
quarter of 2023.
"I am immensely proud of our team's continued focus on moving
our company forward, particularly in a quarter affected by the
tragic wildfires in Maui," said
Hawaiian Airlines President and CEO Peter
Ingram. "Underlying demand remains resilient, our
brand and business model are core strengths and the major
investments we are making now will create substantial value in 2024
and beyond."
Third
Quarter 2023- Key Financial Metrics and
Results
|
|
|
GAAP
|
|
YoY
Change
|
|
Adjusted
(a)
|
|
YoY
Change
|
Net
Loss
|
|
($48.7M)
|
|
($39.5M)
|
|
($54.9M)
|
|
($47.2M)
|
Diluted
EPS
|
|
($0.94)
|
|
($0.76)
|
|
($1.06)
|
|
($0.91)
|
Pre-tax
Margin
|
|
(8.3) %
|
|
(6.8) pts.
|
|
(9.5) %
|
|
(8.2) pts.
|
EBITDA
|
|
($3.2M)
|
|
($49.9M)
|
|
($11.7M)
|
|
($59.6M)
|
Operating Cost per
ASM
(CASM)
|
|
15.14¢
|
|
0.9 %
|
|
11.27¢
|
|
9.2 %
|
Operating Revenue
per
ASM (RASM)
|
|
14.08¢
|
|
(5.7) %
|
|
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.
|
Statistical data, as well as a reconciliation of the reported
non-GAAP financial measures, can be found in the accompanying
tables.
Liquidity and Capital Resources
As of September 30, 2023, the Company had:
- Unrestricted cash, cash equivalents and short-term investments
of $1.13 billion
- $1.39 billion in liquidity,
including its undrawn $235 million
revolving credit facility
- Outstanding debt and finance lease obligations of $1.65 billion
Revenue Environment
The Company reported that third quarter revenue was trending
positively in July, but the devastating wildfires in Lahaina in West
Maui on August 8, 2023 caused
a sharp decrease in traffic to Maui. With most areas of the island unaffected
by the fires and portions of West
Maui reopening to tourism on October
8, 2023, demand for travel to Maui is recovering, but remains below
historical levels. Hawaiian's third quarter schedule was negatively
impacted by the July 25, 2023
announcement from RTX, parent company of Pratt & Whitney, of
anticipated accelerated removals and inspections of a significant
portion of the PW1100G-JM engine fleet, which powers Hawaiian's
A321neo aircraft. This unanticipated time out of service resulted
in, among other things, lower-than-expected capacity growth in the
quarter.
Operating revenue was down 1.8% from the third quarter of 2022
on 4.1% higher capacity across Hawaiian's network. Passenger
traffic remained strong on Hawaiian's Japan routes in the third quarter of 2023.
International revenue increased 90.9% from the third quarter of
2022 on a 43.6% increase in capacity.
Maui Wildfires Relief
In the immediate aftermath of the tragic wildfires that
devastated the town of Lahaina in
West Maui, Hawaiian increased its
schedule to evacuate more than 17,000 displaced visitors and
residents within the first 72 hours and to transport vital supplies
and first responders. Within the first week of the disaster,
Hawaiian carried 54,000 tons of emergency supplies. Hawaiian and
its HawaiianMiles members donated millions of miles to the American
Red Cross of Hawai'i, providing the nonprofit with the equivalent
of 18,000 free seats to carry volunteers and personnel to and from
Maui. Hawaiian also donated
$150,000 in cash to charities
including the Hawai'i Foodbank, the Maui Food Bank and the Hawaii
Community Foundation's Maui Strong Fund. And as travel to
Maui resumed, Hawaiian led the way
with Travel Pono Maui, a video series sharing with visitors what
they can expect traveling to Maui
now.
Today Hawaiian continues to support ongoing relief efforts
through its Malama Maui Desk, which was established to more
efficiently help people and organizations seeking flight, cargo or
other assistance in the aftermath of the wildfires. Hawaiian has
received over 200 individual requests from Hawai'i and across its
network to transport donated food and various goods to affected
residents as well as passengers providing West Maui support services.
Third Quarter 2023 Highlights
Operations
- Commenced service of its A330-300F contract freighter business
on October 2, 2023
Routes and Network
- Announced the resumption of service between Tokyo Haneda
Airport, Japan and Kona, Hawai'i,
starting on October 29, 2023
- Began ticket sales on September 6,
2023 for flights on the Boeing 787-9 Dreamliner, which is
expected to enter service on select West Coast routes commencing on
April 15, 2024
Guest Experience
- Designed new in-flight amenity kits in partnership with
Noho Home, which are focused on
sustainability and rooted in aloha, available starting November 6, 2023
Environmental, Social and Corporate
Governance
- Endowed a scholarship for students studying Information
Technology at the University of Hawai'i
Fourth Quarter 2023 Outlook
The table below summarizes the Company's expectations for the
quarter ending December 31, 2023
expressed as an expected percentage change compared to the results
for the quarter ended December 31,
2022. Figures include the impacts of the Company's freighter
operation, which are not yet material.
Item
|
|
GAAP Fourth
Quarter
2023 Guidance
|
|
Non-GAAP
Equivalent
|
|
Non-GAAP Fourth
Quarter
2023 Guidance
|
Available Seat Miles
(ASMs)
|
|
Up 1.5% to up
4.5%
|
|
|
|
|
Operating Revenue
per ASM
(RASM)
|
|
Down 10.0% to down
13.0%
|
|
|
|
|
Costs per ASM
(CASM)
|
|
Up 2.0% to up
4.1%
|
|
CASM excluding fuel
and
non-recurring items (a)
|
|
Up 6.5% to up
9.5%
|
Gallons of Jet Fuel
Consumed
|
|
Up 5.0% to up
8.0%
|
|
|
|
|
Average fuel price
per gallon,
including taxes and delivery (b)
|
|
$3.09
|
|
Economic Fuel Price
per
Gallon (a)(b)
|
|
$3.12
|
Effective Tax
Rate
|
|
~21%
|
|
|
|
|
Full Year 2023 Outlook
The table below summarizes the Company's updated expectations
for the full year ending December 31,
2023 expressed as an expected percentage change compared to
the results for the year ended December 31,
2022. Figures include the impacts of the Company's freighter
operation, which are not yet material.
Item
|
|
Prior GAAP
Full Year 2023
Guidance
|
|
Updated GAAP
Full
Year 2023
Guidance
|
|
Non-GAAP
Equivalent
|
|
Prior Non-GAAP
Full Year 2023
Guidance
|
|
Updated Non-
GAAP Full Year
2023 Guidance
|
Available Seat
Miles (ASMs)
|
|
Up 8.0% to up
10.0%
|
|
Up 7.5% to
8.5%
|
|
|
|
|
|
|
Costs per
ASM
|
|
Down 2.1% to
down 3.5%
|
|
Down 0.8% to down
1.9%
|
|
CASM excluding
fuel and
non-recurring items (a)
|
|
Up 3.0% to up
5.0%
|
|
Up 4.0% to up
5.5%
|
Gallons of Jet
Fuel Consumed
|
|
Up 12.5% to up
14.5%
|
|
Up 11.5% to up
13.0%
|
|
|
|
|
|
|
Average fuel
price per gallon,
including taxes
and delivery (b)
|
|
$2.78
|
|
$2.89
|
|
Economic Fuel
Price per Gallon
(a)(b)
|
|
$2.81
|
|
$2.93
|
Capital
Expenditures
|
|
$265M to
$295M
|
|
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) Fuel Price per
Gallon estimates are based on the October 13, 2023 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, October 24,
2023, 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 94th 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 timing and expectations related to network and route
recovery; expectations for the resumption of service between
Tokyo, Japan and Kona, Hawai'i;
expectations for when customers will receive Noho Home in-flight amenity kits; expectations
relating to the timing of aircraft, such as the Boeing 787-9
Dreamliner, entry into service; future domestic and international
demand for air travel; the Company's outlook for the quarter ending
December 31, 2023 and twelve-months
ending December 31, 2023; 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
September 30,
|
|
Nine months ended
September 30,
|
|
|
2023
|
|
2022
|
|
%
Change
|
|
2023
|
|
2022
|
|
%
Change
|
|
|
(in thousands,
except per share data)
|
Operating
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
Passenger
|
|
$
664,866
|
|
$
663,107
|
|
0.3 %
|
|
$
1,858,384
|
|
$
1,684,599
|
|
10.3 %
|
Other
|
|
62,813
|
|
78,047
|
|
(19.5) %
|
|
188,826
|
|
225,634
|
|
(16.3) %
|
Total
|
|
727,679
|
|
741,154
|
|
(1.8) %
|
|
2,047,210
|
|
1,910,233
|
|
7.2 %
|
Operating
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Wages and
benefits
|
|
248,899
|
|
206,306
|
|
20.6 %
|
|
728,512
|
|
615,091
|
|
18.4 %
|
Aircraft fuel,
including taxes and delivery
|
|
200,069
|
|
225,999
|
|
(11.5) %
|
|
564,075
|
|
603,873
|
|
(6.6) %
|
Maintenance, materials
and repairs
|
|
65,057
|
|
59,317
|
|
9.7 %
|
|
169,000
|
|
170,934
|
|
(1.1) %
|
Aircraft and passenger
servicing
|
|
46,225
|
|
41,044
|
|
12.6 %
|
|
131,883
|
|
110,490
|
|
19.4 %
|
Depreciation and
amortization
|
|
34,760
|
|
34,347
|
|
1.2 %
|
|
100,775
|
|
102,435
|
|
(1.6) %
|
Commissions and other
selling
|
|
29,695
|
|
32,505
|
|
(8.6) %
|
|
86,324
|
|
81,767
|
|
5.6 %
|
Aircraft
rent
|
|
26,497
|
|
25,921
|
|
2.2 %
|
|
80,827
|
|
77,987
|
|
3.6 %
|
Other rentals and
landing fees
|
|
46,366
|
|
38,370
|
|
20.8 %
|
|
126,574
|
|
110,022
|
|
15.0 %
|
Purchased
services
|
|
36,568
|
|
31,269
|
|
16.9 %
|
|
108,821
|
|
95,713
|
|
13.7 %
|
Special
items
|
|
—
|
|
6,303
|
|
(100.0) %
|
|
—
|
|
6,303
|
|
(100.0) %
|
Other
|
|
48,460
|
|
43,145
|
|
12.3 %
|
|
132,344
|
|
112,884
|
|
17.2 %
|
Total
|
|
782,596
|
|
744,526
|
|
5.1 %
|
|
2,229,135
|
|
2,087,499
|
|
6.8 %
|
Operating
Loss
|
|
(54,917)
|
|
(3,372)
|
|
1,528.6 %
|
|
(181,925)
|
|
(177,266)
|
|
2.6 %
|
Nonoperating Income
(Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense and
amortization of debt
discounts and issuance costs
|
|
(22,597)
|
|
(23,206)
|
|
|
|
(68,182)
|
|
(72,760)
|
|
|
Interest
income
|
|
13,685
|
|
9,287
|
|
|
|
43,689
|
|
20,283
|
|
|
Capitalized
interest
|
|
2,306
|
|
1,061
|
|
|
|
5,709
|
|
3,173
|
|
|
Gains (losses) on fuel
derivatives
|
|
3,097
|
|
(1,063)
|
|
|
|
(5,627)
|
|
(1,063)
|
|
|
Loss on extinguishment
of debt
|
|
—
|
|
—
|
|
|
|
—
|
|
(8,568)
|
|
|
Other components of
net periodic benefit
cost
|
|
(1,707)
|
|
1,252
|
|
|
|
(4,907)
|
|
3,812
|
|
|
Losses on investments,
net
|
|
(4,054)
|
|
(4,028)
|
|
|
|
(6,906)
|
|
(38,519)
|
|
|
Gains on foreign
debt
|
|
4,311
|
|
9,978
|
|
|
|
18,745
|
|
42,295
|
|
|
Other, net
|
|
(644)
|
|
(688)
|
|
|
|
(1,408)
|
|
(2,318)
|
|
|
Total
|
|
(5,603)
|
|
(7,407)
|
|
|
|
(18,887)
|
|
(53,665)
|
|
|
Loss Before Income
Taxes
|
|
(60,520)
|
|
(10,779)
|
|
|
|
(200,812)
|
|
(230,931)
|
|
|
Income tax
benefit
|
|
(11,800)
|
|
(1,510)
|
|
|
|
(41,500)
|
|
(41,010)
|
|
|
Net
Loss
|
|
$
(48,720)
|
|
$ (9,269)
|
|
|
|
$
(159,312)
|
|
$
(189,921)
|
|
|
Net Loss Per
Share
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
(0.94)
|
|
$
(0.18)
|
|
|
|
$
(3.09)
|
|
$
(3.70)
|
|
|
Diluted
|
|
$
(0.94)
|
|
$
(0.18)
|
|
|
|
$
(3.09)
|
|
$
(3.70)
|
|
|
Weighted Average
Number of Common
Stock Shares Outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
51,632
|
|
51,388
|
|
|
|
51,576
|
|
51,344
|
|
|
Diluted
|
|
51,632
|
|
51,388
|
|
|
|
51,576
|
|
51,344
|
|
|
Hawaiian
Holdings, Inc.
|
Consolidated Balance
Sheet (unaudited)
|
|
|
|
September 30,
2023 (unaudited)
|
|
December 31,
2022
|
|
|
(in thousands,
except shares)
|
ASSETS
|
|
|
|
|
Current
Assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
110,671
|
|
$
229,122
|
Restricted
cash
|
|
17,250
|
|
17,498
|
Short-term
investments
|
|
1,023,534
|
|
1,147,193
|
Accounts receivable,
net
|
|
97,283
|
|
113,862
|
Income taxes
receivable
|
|
1,660
|
|
70,204
|
Spare parts and
supplies, net
|
|
53,817
|
|
36,875
|
Prepaid expenses and
other
|
|
91,754
|
|
63,553
|
Total
|
|
1,395,969
|
|
1,678,307
|
Property and equipment,
less accumulated depreciation and amortization of
$1,143,934 and $1,135,262 as of September 30, 2023 and
December 31, 2022,
respectively
|
|
1,969,556
|
|
1,874,352
|
Other
Assets:
|
|
|
|
|
Assets
held-for-sale
|
|
2,813
|
|
14,019
|
Operating lease
right-of-use assets
|
|
423,706
|
|
459,128
|
Long-term prepayments
and other
|
|
117,716
|
|
100,317
|
Intangible assets,
net
|
|
13,500
|
|
13,500
|
Total
Assets
|
|
$
3,923,260
|
|
$
4,139,623
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
Accounts
payable
|
|
$
198,007
|
|
$
196,009
|
Air traffic liability
and current frequent flyer deferred revenue
|
|
699,085
|
|
590,796
|
Other accrued
liabilities
|
|
175,992
|
|
182,036
|
Current maturities of
long-term debt, less discount
|
|
42,364
|
|
47,836
|
Current maturities of
finance lease obligations
|
|
9,998
|
|
25,789
|
Current maturities of
operating leases
|
|
85,214
|
|
77,858
|
Total
|
|
1,210,660
|
|
1,120,324
|
Long-Term
Debt
|
|
1,534,877
|
|
1,583,889
|
Other Liabilities
and Deferred Credits:
|
|
|
|
|
Noncurrent finance
lease obligations
|
|
62,768
|
|
75,221
|
Noncurrent operating
leases
|
|
311,647
|
|
347,726
|
Accumulated pension
and other post-retirement benefit obligations
|
|
143,058
|
|
135,775
|
Other liabilities and
deferred credits
|
|
71,967
|
|
94,654
|
Noncurrent frequent
flyer deferred revenue
|
|
320,657
|
|
318,369
|
Deferred tax
liability, net
|
|
88,868
|
|
130,400
|
Total
|
|
998,965
|
|
1,102,145
|
Commitments and
Contingencies
|
|
|
|
|
Shareholders'
Equity:
|
|
|
|
|
Special preferred
stock, $0.01 par value per share, three shares issued and
outstanding as of September 30, 2023 and December 31,
2022
|
|
—
|
|
—
|
Common stock, $0.01
par value per share, 51,633,094 and 51,450,904 shares
outstanding as of September 30, 2023 and December 31, 2022,
respectively
|
|
516
|
|
514
|
Capital in excess of
par value
|
|
292,335
|
|
287,161
|
Accumulated income
(loss)
|
|
(18,556)
|
|
140,756
|
Accumulated other
comprehensive loss, net
|
|
(95,537)
|
|
(95,166)
|
Total
|
|
178,758
|
|
333,265
|
Total Liabilities
and Shareholders' Equity
|
|
$
3,923,260
|
|
$
4,139,623
|
Hawaiian
Holdings, Inc.
|
Condensed
Consolidated Statements of Cash Flows (unaudited)
|
|
|
|
Nine months ended
September 30,
|
|
|
2023
|
|
2022
|
|
|
(in
thousands)
|
Net cash provided by
(used in) Operating Activities
|
|
$
2,072
|
|
$
(24,050)
|
Cash flows from
Investing Activities:
|
|
|
|
|
Additions to property
and equipment, including pre-delivery payments
|
|
(213,152)
|
|
(29,717)
|
Proceeds from the
disposition of aircraft and aircraft related equipment
|
|
19,911
|
|
10,743
|
Purchases of
investments
|
|
(320,628)
|
|
(751,509)
|
Proceeds from sales
and maturities of investments
|
|
452,913
|
|
756,561
|
Net cash used in
investing activities
|
|
(60,956)
|
|
(13,922)
|
Cash flows from
Financing Activities:
|
|
|
|
|
Repayments of
long-term debt and finance lease obligations
|
|
(58,681)
|
|
(173,298)
|
Debt issuance costs
and discounts
|
|
—
|
|
(2,236)
|
Payment for taxes
withheld for stock compensation
|
|
(1,134)
|
|
(1,842)
|
Net cash used in
financing activities
|
|
(59,815)
|
|
(177,376)
|
Net decrease in cash
and cash equivalents
|
|
(118,699)
|
|
(215,348)
|
Cash, cash
equivalents, and restricted cash - Beginning of
Period
|
|
246,620
|
|
507,828
|
Cash, cash
equivalents, and restricted cash - End of Period
|
|
$
127,921
|
|
$
292,480
|
Table
2.
|
Hawaiian
Holdings, Inc.
|
Selected
Consolidated Statistical Data (unaudited)
|
|
|
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
|
|
2023
|
|
2022
|
|
%
Change
|
|
2023
|
|
2022
|
|
%
Change
|
|
|
(in thousands, except as otherwise indicated)
|
Scheduled
Operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue passengers
flown
|
|
2,828
|
|
2,738
|
|
3.3 %
|
|
8,221
|
|
7,345
|
|
11.9 %
|
Revenue passenger
miles (RPM)
|
|
4,450,305
|
|
4,113,172
|
|
8.2 %
|
|
12,641,181
|
|
10,950,031
|
|
15.4 %
|
Available seat miles
(ASM)
|
|
5,166,464
|
|
4,957,011
|
|
4.2 %
|
|
15,095,334
|
|
13,704,779
|
|
10.1 %
|
Passenger revenue per
RPM (Yield)
|
|
14.94
¢
|
|
16.12
¢
|
|
(7.3) %
|
|
14.70
¢
|
|
15.38
¢
|
|
(4.4) %
|
Passenger load factor
(RPM/ASM)
|
|
86.1 %
|
|
83.0 %
|
|
3.1
pts.
|
|
83.7 %
|
|
79.9 %
|
|
3.8
pts.
|
Passenger revenue per
ASM (PRASM)
|
|
12.87
¢
|
|
13.38
¢
|
|
(3.8) %
|
|
12.31
¢
|
|
12.29
¢
|
|
0.2 %
|
Total
Operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue passengers
flown
|
|
2,828
|
|
2,741
|
|
3.2 %
|
|
8,223
|
|
7,361
|
|
11.7 %
|
Revenue passenger
miles (RPM)
|
|
4,451,484
|
|
4,117,551
|
|
8.1 %
|
|
12,644,415
|
|
10,975,703
|
|
15.2 %
|
Available seat miles
(ASM)
|
|
5,168,883
|
|
4,964,785
|
|
4.1 %
|
|
15,100,831
|
|
13,744,129
|
|
9.9 %
|
Operating revenue per
ASM (RASM)
|
|
14.08
¢
|
|
14.93
¢
|
|
(5.7) %
|
|
13.56
¢
|
|
13.90
¢
|
|
(2.4) %
|
Operating cost per ASM
(CASM)
|
|
15.14
¢
|
|
15.00
¢
|
|
0.9 %
|
|
14.76
¢
|
|
15.19
¢
|
|
(2.8) %
|
CASM excluding
aircraft fuel and non-
recurring items (a)
|
|
11.27 ¢
|
|
10.32
¢
|
|
9.2 %
|
|
11.13 ¢
|
|
10.73
¢
|
|
3.7 %
|
Aircraft fuel expense
per ASM (b)
|
|
3.87 ¢
|
|
4.55 ¢
|
|
(14.9) %
|
|
3.74 ¢
|
|
4.40 ¢
|
|
(15.0) %
|
Revenue block hours
operated
|
|
53,183
|
|
51,284
|
|
3.7 %
|
|
158,058
|
|
143,646
|
|
10.0 %
|
Gallons of jet fuel
consumed
|
|
68,521
|
|
63,834
|
|
7.3 %
|
|
199,735
|
|
174,744
|
|
14.3 %
|
Average cost per
gallon of jet fuel (actual) (b)
|
|
$2.92
|
|
$3.54
|
|
(17.5) %
|
|
$2.82
|
|
$3.46
|
|
(18.5) %
|
|
|
(a)
|
See Table 4 for a
reconciliation of GAAP operating expenses to operating expenses
excluding aircraft fuel and non-recurring items.
|
(b)
|
Includes applicable
taxes and fees.
|
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,
|
|
|
2023
|
|
2022
|
|
% Change
|
|
2023
|
|
2022
|
|
% Change
|
|
|
(in thousands, except per-gallon
amounts)
|
Aircraft fuel expense,
including taxes and
delivery
|
|
$
200,069
|
|
$
225,999
|
|
(11.5) %
|
|
$
564,075
|
|
$
603,873
|
|
(6.6) %
|
Realized losses on
settlement of fuel
derivative contracts
|
|
3,867
|
|
—
|
|
100.0 %
|
|
8,175
|
|
—
|
|
100.0 %
|
Economic fuel
expense
|
|
$
203,936
|
|
$
225,999
|
|
(9.8) %
|
|
$
572,250
|
|
$
603,873
|
|
(5.2) %
|
Fuel gallons
consumed
|
|
68,521
|
|
63,834
|
|
7.3 %
|
|
199,735
|
|
174,744
|
|
14.3 %
|
Economic fuel price per
gallon
|
|
$
2.98
|
|
$
3.54
|
|
(15.8) %
|
|
$
2.87
|
|
$
3.46
|
|
(17.1) %
|
|
|
Estimated three months ending
December 31, 2023
|
|
Estimated full year ending
December 31, 2023
|
|
|
(in thousands, except per-gallon
amounts)
|
Aircraft fuel expense,
including taxes and
delivery
|
|
$
209,236
|
-
|
$
215,215
|
|
$
771,452
|
-
|
$
781,830
|
Realized losses on
settlement of fuel
derivative contracts
|
|
1,977
|
-
|
1,977
|
|
10,151
|
-
|
10,151
|
Economic fuel
expense
|
|
$
211,213
|
-
|
$
217,192
|
|
$
781,603
|
-
|
$
791,981
|
Fuel gallons
consumed
|
|
67,710
|
-
|
69,644
|
|
266,742
|
-
|
270,331
|
Economic fuel price per
gallon
|
|
$
3.12
|
-
|
$
3.12
|
|
$
2.93
|
-
|
$
2.93
|
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.
- In February 2022, the Company
received notice from International Association of Machinists and
Aerospace Workers (IAM) that the agreement was ratified by its
members. The new CBA included a signing bonus of $2.1 million, which was recorded in wages and
benefits. During the second quarter of 2022, the Company and the
IAM also completed a separation program under the CBA and
recognized an additional $2.6 million
one-time expense, which was recorded in wages and benefits.
- 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, and will now
terminate in April 2023. Upon
execution of the MOU, the Company recognized in fiscal year 2022
$12.5 million in termination fees. As
of December 31, 2022, the Company had
approximately $24.1 million in
deferred liabilities to be recognized into earnings over the
remaining contract term as contra-maintenance materials and repairs
expense. During the three and nine months ended September 30, 2023, the Company recognized
approximately $0.0 million and
$24.1 million, respectively, in
amortization within Maintenance, materials and repairs in the
Consolidated Statements of Operations.
- Special items. During the third quarter of 2022,
we estimated the fair value of our remaining ATR-42 and ATR-72
aircraft, which resulted in the recognition of a $6.3 million impairment charge recorded as a
Special item in the consolidated statements of operations.
- Loss (gain) on sale of aircraft. During the
second quarter of 2023, the Company completed the sale of one
ATR-42 aircraft and recognized a loss of approximately $0.4 million on such sale. During the three
months ended June 30, 2022, the
Company sold three ATR-72 aircraft and recorded a $2.6 million gain on sale of aircraft, which was
recorded in other operating expense.
- 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 related to a
refund received on the Company's income tax return. 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.
- Loss on extinguishment of debt. During the three
and six months ended June 30, 2022,
the Company recognized a $8.6 million
loss on the extinguishment of its remaining outstanding Series
2020-1A and Series 2020-1B Equipment
Notes. Loss on extinguishment of debt is excluded to allow
investors to better analyze the Company's core operational
performance and more readily compare its results to other airlines
in the periods presented below.
- 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 loss on equity securities. Unrealized loss 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, interest income on tax refund, gain or loss on sale
of aircraft, gain on sale of commercial real estate, and loss on
extinguishment of debt), helps investors better analyze the
Company's operational performance and compare its results to other
airlines in the periods presented.
|
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
Total
|
|
Diluted
Net Loss
Per Share
|
|
Total
|
|
Diluted
Net Loss
Per Share
|
|
Total
|
|
Diluted
Net Loss
Per Share
|
|
Total
|
|
Diluted
Net Loss
Per Share
|
|
|
(in thousands,
except per share data)
|
Net Loss, as
reported
|
|
$
(48,720)
|
|
$ (0.94)
|
|
$
(9,269)
|
|
$ (0.18)
|
|
$
(159,312)
|
|
$ (3.09)
|
|
$
(189,921)
|
|
$ (3.70)
|
Adjusted
for:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CBA related
expense
|
|
—
|
|
—
|
|
—
|
|
—
|
|
17,727
|
|
0.34
|
|
4,678
|
|
0.09
|
Contract
termination
amortization
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(24,085)
|
|
(0.47)
|
|
—
|
|
—
|
Special
items
|
|
—
|
|
—
|
|
6,303
|
|
0.12
|
|
—
|
|
—
|
|
6,303
|
|
0.12
|
Loss (gain) on sale
of
aircraft
|
|
—
|
|
—
|
|
—
|
|
—
|
|
392
|
|
0.01
|
|
(2,578)
|
|
(0.05)
|
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
|
|
(6,964)
|
|
(0.13)
|
|
1,063
|
|
0.02
|
|
(2,548)
|
|
(0.05)
|
|
1,063
|
|
0.02
|
Loss on
extinguishment
of debt
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
8,568
|
|
0.17
|
Unrealized gain on
foreign debt
|
|
(4,196)
|
|
(0.08)
|
|
(9,734)
|
|
(0.19)
|
|
(18,791)
|
|
(0.36)
|
|
(41,697)
|
|
(0.81)
|
Unrealized loss on
equity securities
|
|
2,607
|
|
0.05
|
|
3,445
|
|
0.07
|
|
3,149
|
|
0.06
|
|
22,839
|
|
0.44
|
Tax effect of
adjustments
|
|
2,344
|
|
0.04
|
|
497
|
|
0.01
|
|
7,445
|
|
0.15
|
|
4,969
|
|
0.10
|
Adjusted net
loss
|
|
$
(54,929)
|
|
$ (1.06)
|
|
$
(7,695)
|
|
$ (0.15)
|
|
$
(190,874)
|
|
$ (3.70)
|
|
$
(185,776)
|
|
$ (3.62)
|
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.
|
|
Three months ended
September 30,
|
|
Nine months ended
September 30,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
(in
thousands)
|
Net Loss
|
|
$
(48,720)
|
|
$
(9,269)
|
|
$
(159,312)
|
|
(189,921)
|
Income tax
benefit
|
|
(11,800)
|
|
(1,510)
|
|
(41,500)
|
|
(41,010)
|
Depreciation and
amortization
|
|
34,760
|
|
34,347
|
|
100,775
|
|
102,435
|
Interest expense and
amortization of debt discounts
and issuance costs
|
|
22,597
|
|
23,206
|
|
68,182
|
|
72,760
|
EBITDA, as
reported
|
|
(3,163)
|
|
46,774
|
|
(31,855)
|
|
(55,736)
|
Adjusted
for:
|
|
|
|
|
|
|
|
|
CBA related
expense
|
|
—
|
|
—
|
|
17,727
|
|
4,678
|
Contract termination
amortization
|
|
—
|
|
—
|
|
(24,085)
|
|
—
|
Special
items
|
|
—
|
|
6,303
|
|
—
|
|
6,303
|
Gain on sale of
commercial real estate
|
|
—
|
|
—
|
|
(10,179)
|
|
—
|
Interest income on tax
refund
|
|
—
|
|
—
|
|
(4,672)
|
|
—
|
Loss on extinguishment
of debt
|
|
—
|
|
—
|
|
—
|
|
8,568
|
Changes in fair value
of fuel derivative instruments
|
|
(6,964)
|
|
1,063
|
|
(2,548)
|
|
1,063
|
Unrealized gain on
foreign debt
|
|
(4,196)
|
|
(9,734)
|
|
(18,791)
|
|
(41,697)
|
Loss (gain) on sale of
aircraft
|
|
—
|
|
—
|
|
392
|
|
(2,578)
|
Unrealized loss on
equity securities
|
|
2,607
|
|
3,445
|
|
3,149
|
|
22,839
|
Adjusted
EBITDA
|
|
$
(11,716)
|
|
$
47,851
|
|
$
(70,862)
|
|
$
(56,560)
|
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,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
(in thousands,
except CASM data)
|
GAAP Operating
Expenses
|
|
$
782,596
|
|
$
744,526
|
|
$ 2,229,135
|
|
$ 2,087,499
|
Adjusted
for:
|
|
|
|
|
|
|
|
|
CBA related
expense
|
|
—
|
|
—
|
|
(17,727)
|
|
(4,678)
|
Contract termination
amortization
|
|
—
|
|
—
|
|
24,085
|
|
—
|
Special
items
|
|
—
|
|
(6,303)
|
|
—
|
|
(6,303)
|
Gain (loss) on sale of
aircraft
|
|
—
|
|
—
|
|
(392)
|
|
2,578
|
Gain on sale of
commercial real estate
|
|
—
|
|
—
|
|
10,179
|
|
—
|
Operating Expenses
excluding non-recurring items
|
|
$
782,596
|
|
$
738,223
|
|
$ 2,245,280
|
|
$ 2,079,096
|
Aircraft fuel,
including taxes and delivery
|
|
(200,069)
|
|
(225,999)
|
|
(564,075)
|
|
(603,873)
|
Operating Expenses
excluding fuel and non-recurring
items
|
|
$
582,527
|
|
$
512,224
|
|
$ 1,681,205
|
|
$ 1,475,223
|
Available Seat
Miles
|
|
5,168,883
|
|
4,964,785
|
|
15,100,831
|
|
13,744,129
|
CASM - GAAP
|
|
15.14 ¢
|
|
15.00 ¢
|
|
14.76 ¢
|
|
15.19 ¢
|
Aircraft fuel,
including taxes and delivery
|
|
(3.87)
|
|
(4.55)
|
|
(3.74)
|
|
(4.40)
|
CBA related
expense
|
|
—
|
|
—
|
|
(0.12)
|
|
(0.03)
|
Contract termination
amortization
|
|
—
|
|
—
|
|
0.16
|
|
—
|
Special
items
|
|
—
|
|
(0.13)
|
|
—
|
|
(0.05)
|
Gain (loss) on sale of
aircraft
|
|
—
|
|
—
|
|
—
|
|
0.02
|
Gain on sale of
commercial real estate
|
|
—
|
|
—
|
|
0.07
|
|
—
|
CASM excluding fuel and
non-recurring items
|
|
11.27 ¢
|
|
10.32 ¢
|
|
11.13 ¢
|
|
10.73 ¢
|
|
|
Estimated three
months ending December 31, 2023
|
|
Estimated year
ending December 31, 2023
|
|
|
(in thousands,
except CASM data)
|
|
(in thousands,
except CASM data)
|
GAAP operating
expenses
|
|
$
792,946
|
-
|
$
833,045
|
|
$
3,016,324
|
-
|
$
3,080,544
|
Aircraft fuel,
including taxes and
delivery
|
|
(209,236)
|
-
|
(215,215)
|
|
(771,452)
|
-
|
(781,830)
|
Less: non recurring
items
|
|
—
|
-
|
—
|
|
16,145
|
-
|
16,145
|
Adjusted operating
expenses
|
|
$
583,710
|
-
|
$
617,830
|
|
$
2,261,017
|
-
|
$
2,314,859
|
Available seat
miles
|
|
5,014,621
|
-
|
5,162,837
|
|
20,085,990
|
-
|
20,272,836
|
CASM - GAAP
|
|
15.81 ¢
|
-
|
16.14 ¢
|
|
15.02 ¢
|
-
|
15.20 ¢
|
Aircraft fuel,
including taxes and
delivery
|
|
(4.17)
|
-
|
(4.17)
|
|
(3.84)
|
-
|
(3.86)
|
Less: non recurring
items
|
|
—
|
-
|
—
|
|
0.08
|
-
|
0.08
|
CASM excluding fuel and
non-recurring
items
|
|
11.64 ¢
|
-
|
11.97 ¢
|
|
11.26 ¢
|
-
|
11.42 ¢
|
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
September 30,
|
|
Nine months ended
September 30,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Pre-Tax Margin, as
reported
|
|
(8.3) %
|
|
(1.5) %
|
|
(9.8) %
|
|
(12.1) %
|
CBA ratification
bonus
|
|
—
|
|
—
|
|
0.9
|
|
0.2
|
Contract termination
amortization
|
|
—
|
|
—
|
|
(1.2)
|
|
—
|
Special
items
|
|
—
|
|
0.9
|
|
—
|
|
0.3
|
Loss (gain) on sale of
aircraft
|
|
—
|
|
—
|
|
—
|
|
(0.1)
|
Gain on sale of
commercial real estate
|
|
—
|
|
—
|
|
(0.5)
|
|
—
|
Interest income on
federal tax refund
|
|
—
|
|
—
|
|
(0.2)
|
|
—
|
Changes in fair value
of fuel derivative contracts
|
|
(1.0)
|
|
0.1
|
|
(0.1)
|
|
0.1
|
Loss on extinguishment
of debt
|
|
—
|
|
—
|
|
—
|
|
0.5
|
Unrealized gain on
foreign debt
|
|
(0.6)
|
|
(1.3)
|
|
(0.9)
|
|
(2.2)
|
Unrealized loss on
equity securities
|
|
0.4
|
|
0.5
|
|
0.1
|
|
1.2
|
Adjusted Pre-Tax
Margin
|
|
(9.5) %
|
|
(1.3) %
|
|
(11.7) %
|
|
(12.1) %
|
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SOURCE Hawaiian Holdings, Inc.