Frontier Group Holdings, Inc. (Nasdaq: ULCC), parent company of
Frontier Airlines, Inc., today reported financial results for the
second quarter of 2023 and issued guidance for the third quarter
and full year 2023.
Second Quarter 2023 Summary:
- Achieved total operating revenues of $967 million, six percent
higher than the 2022 quarter
- Cost per available seat mile ("CASM") improved 20 percent over
the 2022 quarter
- Adjusted CASM (excluding fuel), a non-GAAP measure, improved
five percent over the 2022 quarter
- Realized a pre-tax margin of 9.1 percent, a post-pandemic
record
- Generated ancillary revenue of $80 per passenger, $5 higher per
passenger than the 2022 quarter
- Utilization averaged 11.5 hours per day
- Ended the quarter with $780 million of unrestricted cash
and cash equivalents
- Took delivery of three A321neo aircraft during the second
quarter, increasing the proportion of the fleet comprised of the
more fuel-efficient A320neo family aircraft to 75 percent as of
June 30, 2023, the highest of all major U.S. carriers
- Generated 103 available seat miles (“ASM”) per gallon,
reaffirming Frontier's position as the most fuel-efficient of all
major U.S. carriers and its ongoing commitment to being “America's
Greenest Airline” as measured by ASMs per fuel gallon consumed
- Executed an agreement with CleanJoule to purchase up to 30
million gallons of sustainable aviation fuel, further demonstrating
the Company's commitment to reduce carbon emissions in air
transportation
- Launched 26 new routes during the quarter, including new routes
from Atlanta, Baltimore, Chicago Midway, Cleveland, Detroit,
Houston, Orlando, San Juan, St. Thomas and Tampa, giving customers
greater access to Frontier's Low Fares Done Right
“Results this quarter reflect strong execution by Team Frontier.
Our earnings before tax delivered our highest post-pandemic,
pre-tax margin on 36 percent capacity growth and 35 additional
aircraft compared to the 2019 quarter, and we delivered a five
percent improvement in non-fuel adjusted unit costs over the prior
year quarter," commented Barry Biffle, President and CEO. "I'm
proud of the strong work ethic of Team Frontier employees as we
managed through the challenging conditions presented by June
weather. We are focused on delivering Low Fares Done Right,
including sustaining our cost advantage over the industry as we
grow the airline.”
Second Quarter 2023 Select Financial
Highlights
The following is a summary of second quarter select financial
results, including both GAAP and adjusted (non-GAAP) metrics. Refer
to “Reconciliations of Non-GAAP Financial Information” in the
appendix of this release.
(unaudited, in
millions, except for percentages) |
|
|
Three Months Ended June 30, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
As Reported (GAAP) |
|
Adjusted(Non-GAAP) |
|
As Reported (GAAP) |
|
Adjusted(Non-GAAP) |
Total operating revenues |
|
$ |
967 |
|
|
$ |
967 |
|
|
$ |
909 |
|
|
$ |
909 |
|
Total operating expenses |
|
$ |
888 |
|
|
$ |
888 |
|
|
$ |
902 |
|
|
$ |
885 |
|
Pre-tax income |
|
$ |
88 |
|
|
$ |
88 |
|
|
$ |
8 |
|
|
$ |
25 |
|
Pre-tax income margin |
|
|
9.1 |
% |
|
|
9.1 |
% |
|
|
0.9 |
% |
|
|
2.8 |
% |
Net income |
|
$ |
71 |
|
|
$ |
71 |
|
|
$ |
13 |
|
|
$ |
20 |
|
Diluted earnings (loss) per
share |
|
$ |
0.31 |
|
|
$ |
0.31 |
|
|
$ |
0.06 |
|
|
$ |
0.09 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue Performance
Total operating revenue for the second quarter of 2023 was $967
million, reflecting a revenue per available seat mile (“RASM”) of
10.4 cents, on capacity growth of 23 percent as compared to the
2022 quarter. The RASM decrease from 12.0 cents in 2022 was driven
by a nine percent decrease in revenue per passenger to $127 and
stage length, which was eight percent higher, partially offset by a
one percentage-point increase in load factor to 85.3 percent, all
compared to the 2022 quarter.
Ancillary revenue per passenger for the second quarter was $80,
six percent higher than the 2022 quarter.
Cost Performance
Total operating expenses for the second quarter of 2023 were
$888 million, including $244 million of fuel expenses at an average
cost of $2.69 per gallon. Adjusted (non-GAAP) total operating
expenses (excluding fuel) were $644 million.
CASM was 9.51 cents in the second quarter of 2023, 20 percent
lower than the 2022 quarter. CASM (excluding fuel), a non-GAAP
measure, was 6.90 cents, eight percent lower than the 2022
quarter.
Earnings
Pre-tax income for the second quarter of 2023 was $88 million,
reflecting a margin of 9.1 percent.
Net income for the second quarter of 2023 was $71 million.
Cash and Liquidity
Unrestricted cash and cash equivalents as of June 30, 2023
was $780 million.
Fleet
As of June 30, 2023, Frontier had a fleet of 126 Airbus
single-aisle aircraft, as scheduled below, all financed through
operating leases that expire between 2023 and 2035.
Equipment |
Quantity |
Seats |
A320neo |
82 |
|
186 |
A320ceo |
10 |
|
180 - 186 |
A321ceo |
21 |
|
230 |
A321neo |
13 |
|
240 |
Total
fleet |
126 |
|
|
|
|
|
|
Frontier is “America's Greenest Airline” measured by ASMs per
fuel gallon consumed. During the second quarter of 2023, Frontier
generated 103 ASMs per gallon.
Frontier took delivery of three A321neo aircraft during the
second quarter of 2023, increasing the proportion of the fleet
comprised of the more fuel-efficient A320neo family aircraft to 75
percent as of June 30, 2023, the highest of all major U.S.
carriers. The A321neo is expected to unlock meaningful scale
efficiencies by way of fuel savings and higher average seats per
departure. As of June 30, 2023, approximately 70 percent of
future committed aircraft deliveries, including direct leases, are
for A321neo aircraft. As of June 30, 2023, the Company had
commitments for an additional 222 aircraft to be delivered through
2029, including purchase commitments for 67 A320neo aircraft and
150 A321neo aircraft as well as commitments for another 5 A321neo
aircraft through direct leases.
Forward Guidance
The guidance provided below is based on the Company's current
estimates and is not a guarantee of future performance. This
guidance is subject to significant risks and uncertainties that
could cause actual results to differ materially, including the risk
factors discussed in the Company's reports on file with the
Securities and Exchange Commission (the "SEC"). Frontier undertakes
no duty to update any forward-looking statements or estimates,
except as required by applicable law. Further, this guidance
excludes special items and the reconciliation of non-GAAP measures
to the comparable GAAP measures because such amounts cannot be
determined at this time.
Looking forward, the Company expects third-quarter capacity to
grow by 21 to 23 percent over the comparable 2022 quarter and
full-year capacity to grow 19 to 21 percent over the prior year.
Third quarter adjusted (non-GAAP) pre-tax margin (excluding special
items) is expected to be 4 to 7 percent, and the full year 2023
adjusted (non-GAAP) pre-tax margin (excluding special items) is
expected to be 4 to 6 percent. These ranges reflect the impact of
weather-related cancellations in the third quarter, slightly higher
fuel cost per gallon than previous guidance, and a moderation in
average fares caused primarily by a shift in demand to competing
long-haul international destinations.
The current forward guidance estimates for the third quarter
2023 and full-year 2023 are presented in the following table:
|
Third Quarter |
|
2023(a) |
Capacity growth (versus 3Q
2022)(b) |
21% to 23% |
Adjusted (non-GAAP) total
operating expenses (excluding fuel) ($ millions)(c) |
$650 to $665 |
Average fuel cost per
gallon(d) |
$2.80 to $2.90 |
Effective tax rate |
22% |
Adjusted (non-GAAP) pre-tax
margin |
4% to 7% |
|
Full Year |
|
2023(a) |
Capacity growth (versus
2022)(b) |
19% to 21% |
Adjusted (non-GAAP) total
operating expenses (excluding fuel) ($ millions)(c) |
$2,535 to $2,585 |
Average fuel cost per
gallon(d) |
$2.90 to $3.00 |
Effective tax rate |
22% |
Adjusted (non-GAAP) pre-tax
margin |
4% to 6% |
Pre-delivery deposits, net of
refunds ($ millions) |
$100 to $160 |
Other capital expenditures ($
millions)(e) |
$135 to $155 |
_________________(a) Includes guidance on certain non-GAAP
measures, including adjusted total operating expenses (excluding
fuel) and adjusted pre-tax margin, and which excludes, among other
things, special items. The Company is unable to reconcile these
forward-looking projections to GAAP as the nature or amount of such
special items cannot be determined at this time.(b) Given the
dynamic nature of the current demand environment, actual capacity
adjustments made by the Company may be materially different than
what is currently expected.(c) Amount estimated excludes fuel
expense and special items, the latter of which are not estimable at
this time. The amount takes into consideration the additional
expected capacity and the Company's continued investment in the
post-pandemic recovery.(d) Estimated fuel cost per gallon is based
upon the blended jet fuel curve on July 24, 2023 and is inclusive
of estimated fuel taxes and into-plane fuel costs.(e) Other capital
expenditures estimate includes capitalized heavy maintenance. |
|
Conference Call
The Company will host a conference call to discuss second
quarter 2023 results today, August 1, 2023, at 4:30 p.m.
Eastern Time (USA). Investors may listen to a live, listen-only
webcast available on the investor relations section of the
Company's website at
https://ir.flyfrontier.com/news-and-events/events. The call will
also be archived and available for 90 days on the investor
relations section of the Company's website.
About Frontier Airlines
Frontier Airlines, Inc., a subsidiary of Frontier Group
Holdings, Inc. (Nasdaq: ULCC), is committed to “Low Fares Done
Right.” Headquartered in Denver, Colorado, the Company operates 126
A320 family aircraft and has the largest A320neo family fleet in
the U.S. The use of these aircraft, along with Frontier’s
high-density seating configuration and weight-saving initiatives,
have contributed to Frontier’s continued ability to be the most
fuel-efficient of all major U.S. carriers when measured by ASMs per
fuel gallon consumed. With more than 220 new Airbus planes on
order, including direct leases, Frontier will continue to grow to
deliver on the mission of providing affordable travel across
America.
Cautionary Statement Regarding Forward-Looking
Statements and Information
Certain statements in this release should be considered
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, Section 21E of the Securities
Exchange Act of 1934, as amended, and the Private Securities
Litigation Reform Act of 1995. These forward-looking statements are
based on the Company’s current expectations and beliefs with
respect to certain current and future events and anticipated
financial and operating performance. Words such as “expects,”
“will,” “plans,” “intends,” “anticipates,” “indicates,” “remains,”
“believes,” “estimates,” “forecast,” “guidance,” “outlook,”
“goals,” “targets” and similar expressions are intended to identify
forward-looking statements. Additionally, forward-looking
statements include statements that do not relate solely to
historical facts, such as statements which identify uncertainties
or trends, discuss the possible future effects of current known
trends or uncertainties, or which indicate that the future effects
of known trends or uncertainties cannot be predicted, guaranteed or
assured. All forward-looking statements in this release are based
upon information available to the Company on the date of this
release. The Company undertakes no obligation to publicly update or
revise any forward-looking statement, whether as a result of new
information, future events, changed circumstances or otherwise,
except as required by applicable law.
Actual results could differ materially from these
forward-looking statements due to numerous risks and uncertainties
relating to the Company's operations and business environment
including, without limitation, the following: unfavorable economic
and political conditions in the states where the Company operates
and globally, including an inflationary environment and potential
recession, and the resulting impact on cost inputs and/or consumer
demand for air travel; the highly competitive nature of the global
airline industry and susceptibility of the industry to price
discounting and changes in capacity; the Company's ability to
attract and retain qualified personnel at reasonable costs; the
potential future impacts of the COVID-19 pandemic, and possible
outbreaks of another disease or similar public health threat in the
future, on the Company’s business, operating results, financial
condition, liquidity and near-term and long-term strategic
operating plan, including possible additional adverse impacts
resulting from the duration and spread of the pandemic; high and/or
volatile fuel prices or significant disruptions in the supply of
aircraft fuel, including as a result of the war between Russia and
Ukraine; the Company's reliance on technology and automated systems
to operate its business and the impact of any significant failure
or disruption of, or failure to effectively integrate and
implement, the technology or systems; the Company’s reliance on
third-party service providers and the impact of any failure of
these parties to perform as expected, or interruptions in the
Company's relationships with these providers or their provision of
services; adverse publicity and/or harm to the Company's brand or
reputation; reduced travel demand and potential tort liability as a
result of an accident, catastrophe or incident involving the
Company, its codeshare partners or another airline; terrorist
attacks, international hostilities or other security events, or the
fear of terrorist attacks or hostilities, even if not made directly
on the airline industry; increasing privacy and data security
obligations or a significant data breach; further changes to the
airline industry with respect to alliances and joint business
arrangements or due to consolidations; changes in the Company's
network strategy or other factors outside its control resulting in
less economic aircraft orders, costs related to modification or
termination of aircraft orders or entry into less favorable
aircraft orders; the Company's reliance on a single supplier for
its aircraft and two suppliers for its engines, and the impact of
any failure to obtain timely deliveries, additional equipment or
support from any of these suppliers; the impacts of union disputes,
employee strikes or slowdowns, and other labor-related disruptions
on the Company's operations; extended interruptions or disruptions
in service at major airports where the Company operates; the
impacts of seasonality and other factors associated with the
airline industry; the Company's failure to realize the full value
of its intangible assets or its long-lived assets, causing the
Company to record impairments; the costs of compliance with
extensive government regulation of the airline industry; costs,
liabilities and risks associated with environmental regulation and
climate change; the Company's inability to accept or integrate new
aircraft into the Company's fleet as planned; the impacts of the
Company's significant amount of financial leverage from fixed
obligations, the possibility the Company may seek material amounts
of additional financial liquidity in the short-term and the impacts
of insufficient liquidity on the Company's financial condition and
business; failure to comply with the covenants in the Company's
financing agreements or failure to comply with financial and other
covenants governing the Company's other debt; changes in, or
failure to retain, the Company's senior management team or other
key employees; current or future litigation and regulatory actions,
or failure to comply with the terms of any settlement, order or
arrangement relating to these actions; increases in insurance costs
or inadequate insurance coverage; and other risks and uncertainties
set forth from time to time under sections captioned “Risk Factors”
in the Company's reports and other documents filed with the SEC,
including the Company’s Annual Report on Form 10-K for the fiscal
year ended December 31, 2022, which was filed with the SEC on
February 22, 2023.
Frontier Group Holdings, Inc.Condensed
Consolidated Statements of Operations(unaudited, in
millions, except share and per share amounts) |
|
|
Three Months Ended June 30, |
|
Percent Change |
|
Six Months Ended June 30, 2023 |
|
Percent Change |
|
|
2023 |
|
2022 |
|
2023 vs. 2022 |
|
2023 |
|
2022 |
|
2023 vs. 2022 |
Operating revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Passenger |
|
$ |
945 |
|
$ |
890 |
|
6% |
|
$ |
1,775 |
|
$ |
1,478 |
|
20% |
Other |
|
|
22 |
|
|
19 |
|
16% |
|
|
40 |
|
|
36 |
|
11% |
Total operating
revenues |
|
|
967 |
|
|
909 |
|
6% |
|
|
1,815 |
|
|
1,514 |
|
20% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Aircraft fuel |
|
|
244 |
|
|
335 |
|
(27)% |
|
|
536 |
|
|
550 |
|
(3)% |
Salaries, wages and
benefits |
|
|
211 |
|
|
174 |
|
21% |
|
|
414 |
|
|
346 |
|
20% |
Aircraft rent |
|
|
148 |
|
|
133 |
|
11% |
|
|
279 |
|
|
261 |
|
7% |
Station operations |
|
|
124 |
|
|
120 |
|
3% |
|
|
248 |
|
|
225 |
|
10% |
Sales and marketing |
|
|
44 |
|
|
46 |
|
(4)% |
|
|
84 |
|
|
78 |
|
8% |
Maintenance, materials and
repairs |
|
|
52 |
|
|
31 |
|
68% |
|
|
97 |
|
|
65 |
|
49% |
Depreciation and
amortization |
|
|
12 |
|
|
15 |
|
(20)% |
|
|
23 |
|
|
28 |
|
(18)% |
Transaction and merger-related
costs |
|
|
— |
|
|
9 |
|
N/M |
|
|
1 |
|
|
20 |
|
(95)% |
Other operating |
|
|
53 |
|
|
39 |
|
36% |
|
|
79 |
|
|
87 |
|
(9)% |
Total operating
expenses |
|
|
888 |
|
|
902 |
|
(2)% |
|
|
1,761 |
|
|
1,660 |
|
6% |
Operating income
(loss) |
|
|
79 |
|
|
7 |
|
1029% |
|
|
54 |
|
|
(146) |
|
N/M |
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
(7) |
|
|
(3) |
|
133% |
|
|
(13) |
|
|
(12) |
|
8% |
Capitalized interest |
|
|
6 |
|
|
2 |
|
200% |
|
|
12 |
|
|
3 |
|
300% |
Interest income and other |
|
|
10 |
|
|
2 |
|
400% |
|
|
18 |
|
|
2 |
|
800% |
Total other income
(expense) |
|
|
9 |
|
|
1 |
|
800% |
|
|
17 |
|
|
(7) |
|
N/M |
Income (loss) before income
taxes |
|
|
88 |
|
|
8 |
|
1000% |
|
|
71 |
|
|
(153) |
|
N/M |
Income tax expense
(benefit) |
|
|
17 |
|
|
(5) |
|
N/M |
|
|
13 |
|
|
(45) |
|
N/M |
Net income
(loss) |
|
$ |
71 |
|
$ |
13 |
|
446% |
|
$ |
58 |
|
$ |
(108) |
|
N/M |
Earnings (loss) per
share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic(a) |
|
$ |
0.32 |
|
$ |
0.06 |
|
433% |
|
$ |
0.26 |
|
$ |
(0.49) |
|
N/M |
Diluted(a) |
|
$ |
0.31 |
|
$ |
0.06 |
|
417% |
|
$ |
0.26 |
|
$ |
(0.49) |
|
N/M |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average
common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic(a) |
|
|
219,402,647 |
|
|
217,602,480 |
|
1% |
|
|
218,792,850 |
|
|
217,438,904 |
|
1% |
Diluted(a) |
|
|
220,425,659 |
|
|
218,936,545 |
|
1% |
|
|
220,223,273 |
|
|
217,438,904 |
|
1% |
__________________N/M = Not meaningful(a) In periods of net income,
the dilutive impact of the 3.1 million warrants outstanding
relating to funding provided pursuant to the CARES Act and related
legislation, any non-participating options and unvested restricted
stock units are included in the diluted earnings per share
calculations. In addition, most of the Company's 5.3 million
outstanding options are participating securities and are therefore
not expected to be part of the Company's diluted share count under
the two-class method until they are exercised, but, in periods of
net income, are included as an adjustment to the numerator of the
Company's earnings per share calculation as they are eligible to
participate in the Company's earnings. The participating securities
impact has been subtracted from periods presented with positive net
income in the computation of basic and diluted earnings per
share. |
Frontier Group Holdings, Inc.Selected
Operating Statistics(unaudited) |
|
|
Three Months Ended June 30, |
|
Percent Change |
|
Six Months Ended June 30, |
|
Percent Change |
|
|
2023 |
|
2022 |
|
2023 vs. 2022 |
|
2023 |
|
2022 |
|
2023 vs. 2022 |
Available seat miles (ASMs)
(millions) |
|
9,337 |
|
7,594 |
|
23% |
|
18,112 |
|
15,036 |
|
20% |
Departures |
|
45,408 |
|
40,829 |
|
11% |
|
88,120 |
|
79,413 |
|
11% |
Average stage length
(miles) |
|
1,038 |
|
960 |
|
8% |
|
1,045 |
|
977 |
|
7% |
Block hours |
|
128,854 |
|
109,074 |
|
18% |
|
251,824 |
|
215,611 |
|
17% |
Average aircraft in
service |
|
123 |
|
110 |
|
12% |
|
122 |
|
110 |
|
11% |
Aircraft – end of period |
|
126 |
|
114 |
|
11% |
|
126 |
|
114 |
|
11% |
Average daily aircraft
utilization (hours) |
|
11.5 |
|
10.9 |
|
6% |
|
11.4 |
|
10.8 |
|
6% |
Passengers (thousands) |
|
7,596 |
|
6,518 |
|
17% |
|
14,422 |
|
11,946 |
|
21% |
Average seats per
departure |
|
198 |
|
193 |
|
3% |
|
197 |
|
193 |
|
2% |
Revenue passenger miles (RPMs)
(millions) |
|
7,964 |
|
6,388 |
|
25% |
|
15,226 |
|
11,912 |
|
28% |
Load Factor |
|
85.3% |
|
84.1% |
|
1.2pts |
|
84.1% |
|
79.2% |
|
4.9pts |
Fare revenue per
passenger ($) |
|
47.59 |
|
64.44 |
|
(26)% |
|
46.05 |
|
54.33 |
|
(15)% |
Non-fare passenger revenue per
passenger ($) |
|
76.89 |
|
72.01 |
|
7% |
|
77.06 |
|
69.36 |
|
11% |
Other revenue per
passenger ($) |
|
2.75 |
|
2.95 |
|
(7)% |
|
2.72 |
|
3.02 |
|
(10)% |
Total ancillary revenue per
passenger ($) |
|
79.64 |
|
74.96 |
|
6% |
|
79.78 |
|
72.38 |
|
10% |
Total revenue per
passenger ($) |
|
127.23 |
|
139.40 |
|
(9)% |
|
125.83 |
|
126.71 |
|
(1)% |
Total revenue per available
seat mile (RASM) (¢) |
|
10.35 |
|
11.97 |
|
(14)% |
|
10.02 |
|
10.07 |
|
—% |
Cost per available seat mile
(CASM) (¢) |
|
9.51 |
|
11.87 |
|
(20)% |
|
9.72 |
|
11.04 |
|
(12)% |
CASM (excluding fuel) (¢) |
|
6.90 |
|
7.46 |
|
(8)% |
|
6.77 |
|
7.38 |
|
(8)% |
CASM + net interest (¢) |
|
9.41 |
|
11.87 |
|
(21)% |
|
9.63 |
|
11.09 |
|
(13)% |
Adjusted CASM (¢) |
|
9.51 |
|
11.65 |
|
(18)% |
|
9.71 |
|
10.85 |
|
(11)% |
Adjusted CASM (excluding fuel)
(¢) |
|
6.90 |
|
7.24 |
|
(5)% |
|
6.76 |
|
7.19 |
|
(6)% |
Adjusted CASM + net interest
(¢) |
|
9.41 |
|
11.64 |
|
(19)% |
|
9.62 |
|
10.85 |
|
(11)% |
Fuel cost per gallon ($) |
|
2.69 |
|
4.41 |
|
(39)% |
|
3.06 |
|
3.72 |
|
(18)% |
Fuel gallons consumed
(thousands) |
|
90,379 |
|
76,000 |
|
19% |
|
174,966 |
|
147,993 |
|
18% |
Full-time equivalent employees
(FTEs) |
|
6,692 |
|
5,712 |
|
17% |
|
6,692 |
|
5,712 |
|
17% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliations of Non-GAAP Financial
Information
The Company is providing below a reconciliation of GAAP
financial information to the non-GAAP financial information
provided. The non-GAAP financial information is included to provide
supplemental disclosures because the Company believes they are
useful additional indicators of, among other things, its operating
and cost performance. These non-GAAP financial measures have
limitations as analytical tools. Because of these limitations,
determinations of the Company’s operating performance or CASM
excluding unrealized gains and losses, special items or other items
should not be considered in isolation or as a substitute for
performance measures calculated in accordance with GAAP. These
non-GAAP financial measures may be presented on a different basis
than other companies using similarly titled non-GAAP financial
measures.
Reconciliation of Net Income (Loss) to Adjusted Net
Income (Loss) and Adjusted Pre-tax Income (Loss)($
in millions) (unaudited)
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Net income (loss), as reported |
|
$ |
71 |
|
|
$ |
13 |
|
|
$ |
58 |
|
|
$ |
(108 |
) |
|
|
|
|
|
|
|
|
|
Non-GAAP Adjustments: |
|
|
|
|
|
|
|
|
Salaries, wages and benefits |
|
|
|
|
|
|
|
|
Collective bargaining contract ratification(a) |
|
|
— |
|
|
|
1 |
|
|
|
— |
|
|
|
1 |
|
Depreciation and amortization |
|
|
|
|
|
|
|
|
Asset impairment(b) |
|
|
— |
|
|
|
7 |
|
|
|
— |
|
|
|
7 |
|
Other operating expenses |
|
|
|
|
|
|
|
|
Transaction and merger-related costs(c) |
|
|
— |
|
|
|
9 |
|
|
|
1 |
|
|
|
20 |
|
Interest expense |
|
|
|
|
|
|
|
|
CARES Act – write-off of deferred financing costs due to paydown of
loan(d) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
7 |
|
Pre-tax impact |
|
|
— |
|
|
|
17 |
|
|
|
1 |
|
|
|
35 |
|
Tax benefit (expense), non-GAAP |
|
|
— |
|
|
|
(10 |
) |
|
|
— |
|
|
|
(16 |
) |
Net
income (loss) impact |
|
|
— |
|
|
|
7 |
|
|
|
1 |
|
|
|
19 |
|
|
|
|
|
|
|
|
|
|
Adjusted net income (loss), non-GAAP(e) |
|
$ |
71 |
|
|
$ |
20 |
|
|
$ |
59 |
|
|
$ |
(89 |
) |
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes, as reported |
|
$ |
88 |
|
|
$ |
8 |
|
|
$ |
71 |
|
|
$ |
(153 |
) |
Pre-tax impact |
|
|
— |
|
|
|
17 |
|
|
|
1 |
|
|
|
35 |
|
Adjusted pre-tax
income (loss), non-GAAP(e) |
|
$ |
88 |
|
|
$ |
25 |
|
|
$ |
72 |
|
|
$ |
(118 |
) |
__________________(a) Represents $1 million of costs related
to the collective bargaining contract ratification costs earned
through May 2023 and committed to by us as part of an agreement
with the union representing our aircraft technicians that was
ratified and became effective in May 2022.(b) Represents a
write-off of capitalized software development costs as a result of
a termination of a vendor arrangement.(c) For the six months ended
June 30, 2023, adjustments primarily represent $1 million
in employee retention costs incurred in connection with the
terminated merger with Spirit Airlines, Inc. For the three months
ended June 30, 2022, adjustments represent $5 million in
employee retention costs and $4 million in transaction costs,
including banking, legal and accounting fees, incurred in
connection with the terminated merger with Spirit. For the six
months ended June 30, 2022, adjustments represent $12 million
in transaction costs, including banking, legal and accounting fees,
and $8 million in employee retention costs incurred in
connection with the terminated merger with Spirit(d) On February 2,
2022, the Company repaid the loan under its facility with the U.S.
Department of the Treasury, which resulted in a one-time write-off
of the remaining $7 million in unamortized deferred financing
costs. This amount is a component of interest expense.(e) Adjusted
net income (loss) and adjusted pre-tax income (loss) are included
as a supplemental disclosure because the Company believes they are
useful indicators of its operating performance. Derivations of net
income and pre-tax income are well-recognized performance
measurements in the airline industry that are frequently used by
the Company's management, as well as by investors, securities
analysts and other interested parties, in comparing the operating
performance of companies in the airline industry. |
|
Adjusted net income (loss) and adjusted pre-tax income (loss)
have limitations as analytical tools. Adjusted net income (loss)
and adjusted pre-tax income (loss) do not reflect the impact of
certain cash charges resulting from matters the Company considers
not to be indicative of the Company's ongoing operations and do not
reflect the Company's cash expenditures, or future requirements,
for capital expenditures or contractual commitments, and other
companies in the industry may calculate adjusted net income (loss)
and adjusted pre-tax income (loss) differently than the Company
does, limiting their usefulness as comparative measures. Because of
these limitations, adjusted net income (loss) and adjusted pre-tax
income (loss) should not be considered in isolation from or as a
substitute for performance measures calculated in accordance with
GAAP. In addition, because derivations of adjusted net income
(loss) and adjusted pre-tax income (loss), including adjusted
pre-tax margin, are not determined in accordance with GAAP, such
measures are susceptible to varying calculations and not all
companies calculate the measures in the same manner. As a result,
derivations of net income, including adjusted net income (loss) and
adjusted pre-tax income (loss), as presented may not be directly
comparable to similarly titled measures presented by other
companies. For the foregoing reasons, adjusted net income (loss)
and adjusted pre-tax income (loss) have significant limitations
which affect their use as indicators of the Company's
profitability. Accordingly, you are cautioned not to place undue
reliance on this information.
Reconciliation of Total Operating Expenses to Total
Operating Expenses (excluding fuel), Adjusted Total Operating
Expenses and Adjusted Total Operating Expenses (excluding
fuel)($ in millions) (unaudited)
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Total operating
expenses, as reported(a) |
|
$ |
888 |
|
|
$ |
902 |
|
|
$ |
1,761 |
|
|
$ |
1,660 |
|
Transaction and merger-related
costs |
|
|
— |
|
|
|
(9 |
) |
|
|
(1 |
) |
|
|
(20 |
) |
Asset impairment |
|
|
— |
|
|
|
(7 |
) |
|
|
— |
|
|
|
(7 |
) |
Collective bargaining contract
ratification |
|
|
— |
|
|
|
(1 |
) |
|
|
— |
|
|
|
(1 |
) |
Adjusted total
operating expenses, non-GAAP(b) |
|
|
888 |
|
|
|
885 |
|
|
|
1,760 |
|
|
|
1,632 |
|
Aircraft fuel |
|
|
(244 |
) |
|
|
(335 |
) |
|
|
(536 |
) |
|
|
(550 |
) |
Adjusted total
operating expenses (excluding fuel),
non-GAAP(b) |
|
$ |
644 |
|
|
$ |
550 |
|
|
$ |
1,224 |
|
|
$ |
1,082 |
|
|
|
|
|
|
|
|
|
|
Total operating
expenses, as reported |
|
$ |
888 |
|
|
$ |
902 |
|
|
$ |
1,761 |
|
|
$ |
1,660 |
|
Aircraft fuel |
|
|
(244 |
) |
|
|
(335 |
) |
|
|
(536 |
) |
|
|
(550 |
) |
Total operating
expenses (excluding fuel)(b) |
|
$ |
644 |
|
|
$ |
567 |
|
|
$ |
1,225 |
|
|
$ |
1,110 |
|
__________________(a) See “Reconciliation of Net Income (Loss) to
Adjusted Net Income (Loss) and Adjusted Pre-tax Income (Loss)”
above for discussion on adjusting items.(b) Total operating
expenses (excluding fuel), adjusted total operating expenses and
adjusted total operating expenses (excluding fuel) are included as
supplemental disclosures because the Company believes they are
useful indicators of its operating performance. Derivations of
total operating expenses are well-recognized performance
measurements in the airline industry that are frequently used by
the Company's management, as well as by investors, securities
analysts and other interested parties, in comparing the operating
performance of companies in the airline industry. |
|
Total operating expenses (excluding fuel), adjusted total
operating expenses and adjusted total operating expenses (excluding
fuel) have limitations as analytical tools and other companies in
the industry may calculate total operating expenses (excluding
fuel), adjusted total operating expenses and adjusted total
operating expenses (excluding fuel) differently than the Company
does, limiting their usefulness as comparative measures. Because of
these limitations, total operating expenses (excluding fuel),
adjusted total operating expenses and adjusted total operating
expenses (excluding fuel) should not be considered in isolation
from or as a substitute for performance measures calculated in
accordance with GAAP. In addition, because derivations of total
operating expenses (excluding fuel), adjusted total operating
expenses and adjusted total operating expenses (excluding fuel) are
not determined in accordance with GAAP, such measures are
susceptible to varying calculations and not all companies calculate
the measures in the same manner. As a result, derivations of total
operating expenses, including total operating expenses (excluding
fuel), adjusted total operating expenses and adjusted total
operating expenses (excluding fuel) as presented may not be
directly comparable to similarly titled measures presented by other
companies. For the foregoing reasons, total operating expenses
(excluding fuel), adjusted total operating expenses and adjusted
total operating expenses (excluding fuel) have significant
limitations which affect their use as an indicator of the Company's
profitability. Accordingly, you are cautioned not to place undue
reliance on this information.
Reconciliation of Net Income (Loss) to EBITDA and
EBITDAR and to Adjusted EBITDA and Adjusted
EBITDAR($ in millions) (unaudited)
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Net income
(loss) |
|
$ |
71 |
|
|
$ |
13 |
|
|
$ |
58 |
|
|
$ |
(108 |
) |
Plus (minus): |
|
|
|
|
|
|
|
|
Interest expense |
|
|
7 |
|
|
|
3 |
|
|
|
13 |
|
|
|
12 |
|
Capitalized interest |
|
|
(6 |
) |
|
|
(2 |
) |
|
|
(12 |
) |
|
|
(3 |
) |
Interest income and other |
|
|
(10 |
) |
|
|
(2 |
) |
|
|
(18 |
) |
|
|
(2 |
) |
Income tax expense (benefit) |
|
|
17 |
|
|
|
(5 |
) |
|
|
13 |
|
|
|
(45 |
) |
Depreciation and amortization |
|
|
12 |
|
|
|
15 |
|
|
|
23 |
|
|
|
28 |
|
EBITDA(a) |
|
|
91 |
|
|
|
22 |
|
|
|
77 |
|
|
|
(118 |
) |
Plus: Aircraft rent |
|
|
148 |
|
|
|
133 |
|
|
|
279 |
|
|
|
261 |
|
EBITDAR(b) |
|
$ |
239 |
|
|
$ |
155 |
|
|
$ |
356 |
|
|
$ |
143 |
|
|
|
|
|
|
|
|
|
|
EBITDA |
|
$ |
91 |
|
|
$ |
22 |
|
|
$ |
77 |
|
|
$ |
(118 |
) |
Plus (minus)(c): |
|
|
|
|
|
|
|
|
Transaction and merger-related costs |
|
|
— |
|
|
|
9 |
|
|
|
1 |
|
|
|
20 |
|
Collective bargaining contract ratification |
|
|
— |
|
|
|
1 |
|
|
|
— |
|
|
|
1 |
|
Adjusted
EBITDA(a) |
|
|
91 |
|
|
|
32 |
|
|
|
78 |
|
|
|
(97 |
) |
Plus: Aircraft rent |
|
|
148 |
|
|
|
133 |
|
|
|
279 |
|
|
|
261 |
|
Adjusted
EBITDAR(b) |
|
$ |
239 |
|
|
$ |
165 |
|
|
$ |
357 |
|
|
$ |
164 |
|
__________________(a) EBITDA and adjusted EBITDA are included as
supplemental disclosures because the Company believes they are
useful indicators of its operating performance. Derivations of
EBITDA are well-recognized performance measurements in the airline
industry that are frequently used by the Company's management, as
well as by investors, securities analysts and other interested
parties, in comparing the operating performance of companies in the
industry.EBITDA and adjusted EBITDA do not reflect the impact of
certain cash charges resulting from matters the Company considers
not to be indicative of its ongoing operations; the Company's cash
expenditures, or future requirements, for capital expenditures or
contractual commitments; changes in, or cash requirements for, the
Company's working capital needs; or the interest expense, or the
cash requirements necessary to service interest or principal
payments, on the Company's indebtedness or possible cash
requirements related to its warrants. Further, although
depreciation and amortization are non-cash charges, the assets
being depreciated and amortized will often have to be replaced in
the future, and EBITDA and adjusted EBITDA do not reflect any cash
requirements for such replacements. Other companies in the airline
industry may calculate EBITDA and adjusted EBITDA differently than
the Company does, limiting their usefulness as comparative
measures. Because of these limitations, EBITDA and adjusted EBITDA
should not be considered in isolation from or as a substitute for
performance measures calculated in accordance with GAAP. In
addition, because derivations of EBITDA and adjusted EBITDA are not
determined in accordance with GAAP, such measures are susceptible
to varying calculations and not all companies calculate the
measures in the same manner. As a result, derivations of EBITDA,
including adjusted EBITDA, as presented may not be directly
comparable to similarly titled measures presented by other
companies.For the foregoing reasons, each of EBITDA and adjusted
EBITDA have significant limitations which affect its use as an
indicator of the Company's profitability. Accordingly, you are
cautioned not to place undue reliance on this information.(b)
EBITDAR and adjusted EBITDAR are included as supplemental
disclosures because the Company believes they are useful solely as
valuation metrics for airlines as their calculations isolate the
effects of financing in general, the accounting effects of capital
spending and acquisitions (primarily aircraft, which may be
acquired directly, directly subject to acquisition debt, by capital
lease or by operating lease, each of which is presented differently
for accounting purposes), and income taxes, which may vary
significantly between periods and for different airlines for
reasons unrelated to the underlying value of a particular airline.
However, EBITDAR and adjusted EBITDAR are not determined in
accordance with GAAP, are susceptible to varying calculations and
not all companies calculate the measures in the same manner. As a
result, EBITDAR and adjusted EBITDAR, as presented, may not be
directly comparable to similarly titled measures presented by other
companies. In addition, EBITDAR and adjusted EBITDAR should not be
viewed as a measure of overall performance since they exclude
aircraft rent, which is a normal, recurring cash operating expense
that is necessary to operate the business. Accordingly, you are
cautioned not to place undue reliance on this information.(c) See
“Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss)
and Adjusted Pre-tax Income (Loss)” above for discussion on
adjusting items. |
|
Reconciliation of CASM to CASM (excluding fuel),
Adjusted CASM (excluding fuel), Adjusted CASM, Adjusted CASM
including net interest and CASM including net interest
(unaudited)
|
|
Three Months Ended June 30, |
|
|
2023 |
|
2022 |
|
|
($ in millions) |
|
Per ASM (¢) |
|
($ in millions) |
|
Per ASM (¢) |
CASM(a)(b) |
|
|
|
9.51 |
|
|
|
|
11.87 |
|
Aircraft fuel |
|
(244 |
) |
|
(2.61 |
) |
|
(335 |
) |
|
(4.41 |
) |
CASM (excluding
fuel)(c) |
|
|
|
6.90 |
|
|
|
|
7.46 |
|
Transaction and merger-related
costs |
|
— |
|
|
— |
|
|
(9 |
) |
|
(0.12 |
) |
Asset impairment |
|
— |
|
|
— |
|
|
(7 |
) |
|
(0.09 |
) |
Collective bargaining contract
ratification |
|
— |
|
|
— |
|
|
(1 |
) |
|
(0.01 |
) |
Adjusted CASM
(excluding fuel)(c) |
|
|
|
6.90 |
|
|
|
|
7.24 |
|
Aircraft fuel |
|
244 |
|
|
2.61 |
|
|
335 |
|
|
4.41 |
|
Adjusted
CASM(d) |
|
|
|
9.51 |
|
|
|
|
11.65 |
|
Net interest expense
(income) |
|
(9 |
) |
|
(0.10 |
) |
|
(1 |
) |
|
(0.01 |
) |
Adjusted CASM + net
interest(e) |
|
|
|
9.41 |
|
|
|
|
11.64 |
|
|
|
|
|
|
|
|
|
|
CASM |
|
|
|
9.51 |
|
|
|
|
11.87 |
|
Net interest expense
(income) |
|
(9 |
) |
|
(0.10 |
) |
|
(1 |
) |
|
— |
|
CASM + net
interest(e) |
|
|
|
9.41 |
|
|
|
|
11.87 |
|
_______________________(a) Cost per ASM figures may not recalculate
due to rounding.(b) See “Reconciliation of Net Income (Loss) to
Adjusted Net Income (Loss) and Adjusted Pre-tax Income (Loss)”
above for discussion on adjusting items.(c) CASM (excluding fuel)
and adjusted CASM (excluding fuel) are included as supplemental
disclosures because the Company believes that excluding aircraft
fuel is useful to investors as it provides an additional measure of
management’s performance excluding the effects of a significant
cost item over which management has limited influence. The price of
fuel, over which the Company has limited control, impacts the
comparability of period-to-period financial performance, and
excluding allows management an additional tool to understand and
analyze the Company's non-fuel costs and core operating
performance, and increases comparability with other airlines that
also provide a similar metric. CASM (excluding fuel) and adjusted
CASM (excluding fuel) are not determined in accordance with GAAP
and should not be considered in isolation or as a substitute for
performance measures calculated in accordance with GAAP.(d)
Adjusted CASM is included as supplemental disclosure because the
Company believes it is a useful metric to properly compare the
Company’s cost management and performance to other peers, as
derivations of adjusted CASM are well-recognized performance
measurements in the airline industry that are frequently used by
the Company's management, as well as by investors, securities
analysts and other interested parties in comparing the operating
performance of companies in the airline industry. Additionally, the
Company believes this metric is useful because it removes certain
items that may not be indicative of base operating performance or
future results. Adjusted CASM is not determined in accordance with
GAAP, may not be comparable across all carriers and should not be
considered in isolation or as a substitute for performance measures
calculated in accordance with GAAP.(e) Adjusted CASM including net
interest and CASM including net interest are included as
supplemental disclosures because the Company believes they are
useful metrics to properly compare its cost management and
performance to other peers that may have different capital
structures and financing strategies, particularly as it relates to
financing primary operating assets such as aircraft and engines.
Additionally, the Company believes these metrics are useful because
they remove certain items that may not be indicative of base
operating performance or future results. Adjusted CASM including
net interest and CASM including net interest are not determined in
accordance with GAAP, may not be comparable across all carriers and
should not be considered in isolation or as a substitute for
performance measures calculated in accordance with GAAP. |
|
Reconciliation of CASM to CASM (excluding fuel),
Adjusted CASM (excluding fuel), Adjusted CASM, Adjusted CASM
including net interest and CASM including net interest
(unaudited)
|
|
Six Months Ended June 30, |
|
|
2023 |
|
2022 |
|
|
($ in millions) |
|
Per ASM (¢) |
|
($ in millions) |
|
Per ASM (¢) |
CASM(a)(b) |
|
|
|
9.72 |
|
|
|
|
11.04 |
|
Aircraft fuel |
|
(536 |
) |
|
(2.95 |
) |
|
(550 |
) |
|
(3.66 |
) |
CASM (excluding
fuel)(c) |
|
|
|
6.77 |
|
|
|
|
7.38 |
|
Transaction and merger-related
costs |
|
(1 |
) |
|
(0.01 |
) |
|
(20 |
) |
|
(0.13 |
) |
Asset impairment |
|
— |
|
|
— |
|
|
(7 |
) |
|
(0.05 |
) |
Collective bargaining contract
ratification |
|
— |
|
|
— |
|
|
(1 |
) |
|
(0.01 |
) |
Adjusted CASM
(excluding fuel)(c) |
|
|
|
6.76 |
|
|
|
|
7.19 |
|
Aircraft fuel |
|
536 |
|
|
2.95 |
|
|
550 |
|
|
3.66 |
|
Adjusted
CASM(d) |
|
|
|
9.71 |
|
|
|
|
10.85 |
|
Net interest expense
(income) |
|
(17 |
) |
|
(0.09 |
) |
|
7 |
|
|
0.05 |
|
CARES Act – write-off of
deferred financing costs due to paydown of loan |
|
— |
|
|
— |
|
|
(7 |
) |
|
(0.05 |
) |
Adjusted CASM + net
interest(e) |
|
|
|
9.62 |
|
|
|
|
10.85 |
|
|
|
|
|
|
|
|
|
|
CASM |
|
|
|
9.72 |
|
|
|
|
11.04 |
|
Net interest expense
(income) |
|
(17 |
) |
|
(0.09 |
) |
|
7 |
|
|
0.05 |
|
CASM + net
interest(e) |
|
|
|
9.63 |
|
|
|
|
11.09 |
|
_______________________(a) Cost per ASM figures may not recalculate
due to rounding.(b) See “Reconciliation of Net Income (Loss) to
Adjusted Net Income (Loss) and Adjusted Pre-tax Income (Loss)”
above for discussion on adjusting items.(c) CASM (excluding fuel)
and adjusted CASM (excluding fuel) are included as supplemental
disclosures because the Company believes that excluding aircraft
fuel is useful to investors as it provides an additional measure of
management’s performance excluding the effects of a significant
cost item over which management has limited influence. The price of
fuel, over which the Company has limited control, impacts the
comparability of period-to-period financial performance, and
excluding allows management an additional tool to understand and
analyze the Company's non-fuel costs and core operating
performance, and increases comparability with other airlines that
also provide a similar metric. CASM (excluding fuel) and adjusted
CASM (excluding fuel) are not determined in accordance with GAAP
and should not be considered in isolation or as a substitute for
performance measures calculated in accordance with GAAP.(d)
Adjusted CASM is included as supplemental disclosure because the
Company believes it is a useful metric to properly compare the
Company’s cost management and performance to other peers, as
derivations of adjusted CASM are well-recognized performance
measurements in the airline industry that are frequently used by
the Company's management, as well as by investors, securities
analysts and other interested parties in comparing the operating
performance of companies in the airline industry. Additionally, the
Company believes this metric is useful because it removes certain
items that may not be indicative of base operating performance or
future results. Adjusted CASM is not determined in accordance with
GAAP, may not be comparable across all carriers and should not be
considered in isolation or as a substitute for performance measures
calculated in accordance with GAAP.(e) Adjusted CASM including net
interest and CASM including net interest are included as
supplemental disclosures because the Company believes they are
useful metrics to properly compare its cost management and
performance to other peers that may have different capital
structures and financing strategies, particularly as it relates to
financing primary operating assets such as aircraft and engines.
Additionally, the Company believes these metrics are useful because
they remove certain items that may not be indicative of base
operating performance or future results. Adjusted CASM including
net interest and CASM including net interest are not determined in
accordance with GAAP, may not be comparable across all carriers and
should not be considered in isolation or as a substitute for
performance measures calculated in accordance with GAAP. |
|
Reconciliation of Net Income (Loss) per Share to
Adjusted Net Income (Loss) per
Share(unaudited)
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Net income (loss) per
share, diluted, as reported(a)(b) |
|
$ |
0.31 |
|
|
$ |
0.06 |
|
|
$ |
0.26 |
|
|
$ |
(0.49 |
) |
Transaction and merger-related costs |
|
|
— |
|
|
|
0.04 |
|
|
|
— |
|
|
|
0.09 |
|
Asset Impairment |
|
|
— |
|
|
|
0.03 |
|
|
|
— |
|
|
|
0.03 |
|
CARES Act — write-off of deferred financing costs due to paydown of
loan |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.03 |
|
Tax benefit (expense) related to non-GAAP adjustments |
|
|
— |
|
|
|
(0.04 |
) |
|
|
— |
|
|
|
(0.07 |
) |
Adjusted net income
(loss) per share, diluted,
non-GAAP(c) |
|
$ |
0.31 |
|
|
$ |
0.09 |
|
|
$ |
0.26 |
|
|
$ |
(0.41 |
) |
______________________(a) See “Reconciliation of Net Income (Loss)
to Adjusted Net Income (Loss) and Adjusted Pre-tax Income (Loss)”
above for discussion on adjusting items.(b) Cost per share figures
may not recalculate due to rounding.(c) Adjusted net income (loss)
per share is included as a supplemental disclosure because we
believe it is a useful indicator of our operating performance.
Derivations of net income are well-recognized performance
measurements in the airline industry that are frequently used by
our management, as well as by investors, securities analysts and
other interested parties in comparing the operating performance of
companies in our industry. |
|
Adjusted net income (loss) per share has limitations as an
analytical tool. Adjusted net income (loss) per share does not
reflect the impact of certain cash charges resulting from matters
we consider not to be indicative of our ongoing operations and does
not reflect our cash expenditures, or future requirements, for
capital expenditures or contractual commitments, and other
companies in our industry may calculate Adjusted net income (loss)
per share differently than we do, limiting its usefulness as a
comparative measure. Because of these limitations, Adjusted net
income (loss) per share should not be considered in isolation from
or as a substitute for performance measures calculated in
accordance with GAAP. In addition, because derivations of adjusted
net income are not determined in accordance with GAAP, such
measures are susceptible to varying calculations and not all
companies calculate the measures in the same manner. As a result,
derivations of net income, including Adjusted net income (loss) per
share, as presented may not be directly comparable to similarly
titled measures presented by other companies. For the foregoing
reasons, Adjusted net income (loss) per share has significant
limitations which affect its use as an indicator of our
profitability. Accordingly, you are cautioned not to place undue
reliance on this information.
Contacts:
Jennifer F. de la Cruz
Corporate Communications
Email: JenniferF.DeLaCruz@flyfrontier.com
Phone: 720.374.4207
David Erdman
Investor Relations
Email: David.Erdman@flyfrontier.com
Phone: 720.798.5886
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