Frontier Airlines Reports Second Quarter 2024 Financial Results
Frontier Group Holdings (Nasdaq: ULCC), the parent company of Frontier Airlines, reported its Q2 2024 financial results. Total operating revenues reached $973 million, up 1% from Q2 2023.
The company achieved annual cost savings exceeding $100 million from a program initiated in Q3 2023. CASM dropped 6% to 8.98 cents, with adjusted CASM (excluding fuel) at 6.24 cents. Pre-tax income was $32 million, yielding a 3.3% pre-tax margin. Six A321neo aircraft were added, making 80% of the fleet fuel-efficient A320neo family aircraft. This helps maintain the title of "America's Greenest Airline."
In Q3, Frontier deferred 54 aircraft deliveries to 2029-2031, reducing near-term financial commitments. However, total operating expenses rose to $948 million, up from $888 million in Q2 2023. Net income decreased to $31 million from $71 million in Q2 2023.
Future guidance expects a positive RASM inflection by Q4 2024 into 2025.
Frontier Group Holdings (Nasdaq: ULCC), la società madre di Frontier Airlines, ha pubblicato i risultati finanziari per il secondo trimestre del 2024. I ricavi operativi totali hanno raggiunto 973 milioni di dollari, con un aumento dell'1% rispetto al secondo trimestre del 2023.
L'azienda ha realizzato risparmi sui costi annuali superiori a 100 milioni di dollari grazie a un programma avviato nel terzo trimestre del 2023. CASM è sceso del 6%, raggiungendo 8,98 centesimi, con un CASM rettificato (escludendo il carburante) di 6,24 centesimi. Il reddito ante imposte è stato di 32 milioni di dollari, con un margine ante imposte del 3,3%. Sono stati aggiunti sei aerei A321neo, portando l'80% della flotta a essere composti da aerei della famiglia A320neo a basso consumo di carburante. Questo contribuisce a mantenere il titolo di "La compagnia aerea più green d'America."
Nella terza trimestri, Frontier ha posticipato le consegne di 54 aerei al periodo 2029-2031, riducendo così gli impegni finanziari a breve termine. Tuttavia, le spese operative totali sono aumentate a 948 milioni di dollari, rispetto ai 888 milioni del secondo trimestre del 2023. Il reddito netto è diminuito a 31 milioni di dollari, rispetto ai 71 milioni del secondo trimestre del 2023.
Le previsioni future si aspetta un'inflessione positiva del RASM entro il quarto trimestre del 2024 in direzione del 2025.
Frontier Group Holdings (Nasdaq: ULCC), la empresa matriz de Frontier Airlines, informó sus resultados financieros del segundo trimestre de 2024. Los ingresos operativos totales alcanzaron 973 millones de dólares, un aumento del 1% en comparación con el segundo trimestre de 2023.
La compañía logró ahorros anuales en costos que superan los 100 millones de dólares gracias a un programa iniciado en el tercer trimestre de 2023. CASM bajó un 6% a 8.98 centavos, con un CASM ajustado (excluyendo combustible) de 6.24 centavos. Los ingresos antes de impuestos fueron de 32 millones de dólares, lo que da un margen antes de impuestos del 3.3%. Se añadieron seis aviones A321neo, lo que hace que el 80% de la flota sean aviones de la familia A320neo, altamente eficientes en combustible. Esto ayuda a mantener el título de "La aerolínea más ecológica de América."
En el tercer trimestre, Frontier pospuso 54 entregas de aviones para 2029-2031, reduciendo los compromisos financieros a corto plazo. Sin embargo, los gastos operativos totales aumentaron a 948 millones de dólares, frente a los 888 millones del segundo trimestre de 2023. El ingreso neto disminuyó a 31 millones de dólares desde los 71 millones del segundo trimestre de 2023.
Las proyecciones futuras esperan una inflexión positiva del RASM para el cuarto trimestre de 2024, hacia 2025.
프론티어 그룹 홀딩스(Nasdaq: ULCC), 프론티어 항공사 모회사,가 2024년 2분기 재무 결과를 발표했습니다. 총 운영 수익은 9억 7300만 달러에 달하며, 2023년 2분기 대비 1% 증가했습니다.
회사는 2023년 3분기부터 시작된 프로그램을 통해 연간 1억 달러 이상의 비용 절감을 달성했습니다. CASM은 6% 감소하여 8.98센트가 되었으며, 연료를 제외한 조정 CASM은 6.24센트입니다. 세전 수익은 3200만 달러로, 세전 마진은 3.3%입니다. A321neo 항공기 6대가 추가되어, 전체 항공기 중 80%가 연료 효율성이 높은 A320neo 계열입니다. 이는 "미국에서 가장 친환경적인 항공사"라는 타이틀을 유지하는 데 도움이 됩니다.
3분기 동안 프론티어는 54대의 항공기 인도 일정을 2029-2031년으로 연기하여 단기 재정 약속을 줄였습니다. 그러나 총 운영 비용은 9억 4800만 달러로 증가했으며, 2023년 2분기에는 8억 8800만 달러였습니다. 순이익은 3100만 달러로 하락했으며, 2023년 2분기에는 7100만 달러였습니다.
미래 전망은 2024년 4분기부터 2025년까지 긍정적인 RASM 전환이 있을 것으로 예상하고 있습니다.
Frontier Group Holdings (Nasdaq: ULCC), la société mère de Frontier Airlines, a publié ses résultats financiers pour le deuxième trimestre 2024. Les revenus d'exploitation totaux ont atteint 973 millions de dollars, en hausse de 1 % par rapport au deuxième trimestre 2023.
La société a réalisé des économies annuelles de coûts dépassant 100 millions de dollars grâce à un programme mis en place au troisième trimestre 2023. CASM a diminué de 6 % pour atteindre 8,98 cents, avec un CASM ajusté (hors carburant) de 6,24 cents. Le revenu avant impôt était de 32 millions de dollars, ce qui donne une marge avant impôt de 3,3 %. Six avions A321neo ont été ajoutés, ce qui fait en sorte que 80 % de la flotte sont des avions de la famille A320neo, efficaces en termes de consommation de carburant. Cela contribue à maintenir le titre de "La compagnie aérienne la plus verte d'Amérique."
Au troisième trimestre, Frontier a reporté 54 livraisons d'avions à 2029-2031, réduisant ainsi les engagements financiers à court terme. Cependant, les dépenses d'exploitation totales ont augmenté à 948 millions de dollars, contre 888 millions de dollars au deuxième trimestre 2023. Le revenu net a diminué à 31 millions de dollars contre 71 millions de dollars au deuxième trimestre 2023.
Les prévisions futures s'attendent à une inflexion positive du RASM d'ici le quatrième trimestre 2024 vers 2025.
Die Frontier Group Holdings (Nasdaq: ULCC), die Muttergesellschaft von Frontier Airlines, hat die finanziellen Ergebnisse für das zweite Quartal 2024 veröffentlicht. Die Gesamterlöse beliefen sich auf 973 Millionen Dollar, was einem Anstieg von 1 % gegenüber dem zweiten Quartal 2023 entspricht.
Das Unternehmen erzielte jährliche Kosteneinsparungen von über 100 Millionen Dollar durch ein im dritten Quartal 2023 initiiertes Programm. CASM sank um 6 % auf 8,98 Cent, wobei der angepasste CASM (ohne Treibstoff) bei 6,24 Cent lag. Der Gewinn vor Steuern betrug 32 Millionen Dollar, was einer Vorsteuer-Marge von 3,3 % entspricht. Sechs A321neo-Flugzeuge wurden hinzugefügt, so dass 80 % der Flotte aus treibstoffeffizienten A320neo-Familienflugzeugen bestehen. Dies hilft, den Titel "Amerikas grünste Fluggesellschaft" zu bewahren.
Im dritten Quartal verschob Frontier die Lieferung von 54 Flugzeugen auf 2029-2031, wodurch die kurzfristigen finanziellen Verpflichtungen verringert wurden. Die Gesamtkosten stiegen jedoch auf 948 Millionen Dollar, gegenüber 888 Millionen Dollar im zweiten Quartal 2023. Der Nettogewinn fiel auf 31 Millionen Dollar, von 71 Millionen Dollar im zweiten Quartal 2023.
Die zukünftige Orientierung erwartet eine positive RASM-Wendung bis zum vierten Quartal 2024 in Richtung 2025.
- Total operating revenues increased by 1% YoY to $973 million.
- Achieved annual cost savings of over $100 million.
- CASM reduced by 6% to 8.98 cents.
- Pre-tax income of $32 million, with a 3.3% pre-tax margin.
- Fleet upgrade with six new A321neo aircraft, boosting fuel efficiency.
- Total operating expenses increased to $948 million from $888 million.
- Net income decreased to $31 million from $71 million YoY.
- RASM fell by 11% due to domestic seat growth outpacing demand.
Insights
Frontier Airlines' Q2 2024 results present a mixed picture. While total operating revenues increased by
The company's cost-cutting efforts are showing results, with CASM decreasing by
Frontier's fleet modernization continues, with
Frontier's strategy of focusing on peak day flying and network diversification is a smart response to post-pandemic travel patterns. The introduction of 'The New Frontier' initiative, eliminating change fees and expanding customer benefits, aligns with industry trends towards more flexible travel options.
The deferral of 54 aircraft deliveries to 2029-2031 is a prudent move given current market conditions. It reduces near-term capital expenditures and allows for more gradual capacity growth, which could help improve yield management.
Frontier's position as 'America's Greenest Airline' with 104 ASMs per gallon is a strong marketing point and could become increasingly important as environmental concerns grow. However, the company needs to balance this with improving its financial performance to attract investors.
Frontier's Q2 results reflect broader industry trends of robust travel demand on peak days but softer demand on off-peak days. The
The company's expectation of positive year-over-year RASM in Q4 2024 and into 2025 is encouraging, but investors should watch for execution on this forecast. The maturation of new revenue initiatives and network enhancements will be important for achieving this goal.
Frontier's cost advantage and young fleet position it well for the long term, but the near-term focus should be on improving yield management and accelerating the benefits from 'The New Frontier' initiative to drive margin improvement.
Highlights:
- Total operating revenues were
$973 million - Achieved annual run rate cost savings of more than
$100 million - Cost per available seat mile ("CASM") was
8.98 cents , a reduction of 6 percent over the comparable 2023 quarter - Adjusted CASM (excluding fuel), a non-GAAP measure, was
6.24 cents , on a 13 percent shorter average stage length; adjusted CASM (excluding fuel) on a stage-length adjusted basis to 1,000 miles, a non-GAAP measure, was 16 percent lower than the comparable 2023 quarter - Pre-tax income and adjusted (non-GAAP) pre-tax income were each
$32 million - Took delivery of six A321neo aircraft during the second quarter, increasing the proportion of the fleet comprised of the more fuel-efficient A320neo family aircraft to 80 percent as of June 30, 2024, the highest of all major
U.S. carriers - The Company's aircraft delivery schedule with Airbus was updated to defer 54 aircraft deliveries, with original delivery dates in 2025-2028 (based on the March 31, 2024 delivery schedule), out to 2029-2031 (refer to "Fleet" section for more detail)
- Frontier's fleet age is, on average, approximately 4 years, making it the youngest among all
U.S. -based carriers - Generated 104 available seat miles ("ASMs") per gallon, reaffirming Frontier's position as "America's Greenest Airline" as measured by fuel efficiency (ASMs per fuel gallon consumed during the second quarter; compared to all other major
U.S. carriers) - Opened bases in
Cincinnati ,Chicago andSan Juan , bringing the total to 13, and reached targeted levels of scheduled out-and-back flying in June 2024, driving an improvement to on-time performance versus prior year - Introduced 'The New Frontier,' a significant transformation in the Company's product and customer service offerings reflecting a commitment to deliver an exceptional value and superior travel experience to customers
"Despite industry oversupply across
Second Quarter 2024 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 and per share data) | |||||||
Three Months Ended June 30, | |||||||
2024 | 2023 | ||||||
As Reported | Adjusted (Non-GAAP) | As Reported | Adjusted (Non-GAAP) | ||||
Total operating revenues | $ 973 | $ 973 | $ 967 | $ 967 | |||
Total operating expenses | $ 948 | $ 948 | $ 888 | $ 888 | |||
Pre-tax income | $ 32 | $ 32 | $ 88 | $ 88 | |||
Pre-tax margin | 3.3 % | 3.3 % | 9.1 % | 9.1 % | |||
Net income | $ 31 | $ 31 | $ 71 | $ 71 | |||
Earnings per share, diluted | $ 0.14 | $ 0.14 | $ 0.31 | $ 0.31 | |||
Revenue Performance
Total operating revenue for the second quarter of 2024 increased 1 percent to
Revenue per available seat mile ("RASM") was
With scheduled seat growth for both the industry and Frontier expected to decelerate beginning in the third quarter, coupled with the expected progression in the maturity of Frontier's network enhancements and new product and distribution offerings, including the 'The New Frontier,' year-over-year RASM is expected to inflect positive in the fourth quarter of 2024 and into 2025.
Cost Performance
Frontier's sustainable cost advantage delivered total operating expenses of
CASM was
Earnings
Pre-tax income and adjusted (non-GAAP) pre-tax income for the second quarter of 2024 were both
Net income and adjusted (non-GAAP) net income for the second quarter of 2024 were both
Cash and Liquidity
Unrestricted cash and cash equivalents as of June 30, 2024 was
Fleet
As of June 30, 2024, Frontier had a fleet of 148 Airbus single-aisle aircraft, as scheduled below, all financed through operating leases that expire between 2025 and 2036.
Equipment | Quantity | Seats |
A320neo | 82 | 186 |
A320ceo | 8 | 180 - 186 |
A321ceo | 21 | 230 |
A321neo | 37 | 240 |
Total fleet | 148 |
Frontier is "America's Greenest Airline" as measured by fuel efficiency (ASMs per fuel gallon consumed during the second quarter; compared to all other major
Frontier took delivery of six A321neo aircraft during the second quarter of 2024, all financed with sale-leaseback transactions, increasing the proportion of the fleet comprised of the more fuel-efficient A320neo family aircraft to 80 percent as of June 30, 2024, the highest of all major
In August 2024, the Company executed a binding term sheet with Airbus which defers aircraft deliveries with original delivery dates in 2025-2028, out to 2029-2031, lowering fleet inductions in each of the next four years, thereby reducing the Company's financing needs and PDP commitments in the coming years. The expected remaining orderbook of 187 aircraft as of January 1, 2025 are now expected to be delivered as summarized in the following table:
Year | Revised Delivery Schedule (a) | Prior Delivery Schedule | Change |
2025 | 21 | 42 | (21) |
2026 | 22 | 41 | (19) |
2027 | 34 | 42 | (8) |
2028 | 34 | 40 | (6) |
2029 | 36 | 22 | 14 |
2030 and thereafter | 40 | - | 40 |
_________________ | |
(a) | Also includes the impact from the Company's declination of the June 2024 A321XLR conversion option |
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.
The Company reached targeted levels of out-and-back flying in June 2024 and continues to make significant progress in allocating capacity growth to high-fare and underserved "VFR" (Visiting Friends and Relatives) markets. While these network enhancements, along with new product and distribution offerings, including 'The New Frontier,' are expected to be key contributors to Frontier's success, the Company, along with other domestic carriers, is currently experiencing fare pressure caused by excess domestic capacity growth which is expected to begin to decelerate in the second half of 2024 and into early 2025.
The Company determined in June that off-peak demand was underperforming expectations, which led to an adjustment to scheduled capacity for late-August 2024 and beyond. Since this change, average selling fares for September 2024 have inflected positively compared to the prior year.
Third Quarter 2024
Capacity is expected to grow by 4 to 6 percent over the comparable 2023 quarter. Pursuant to the shift to high-fare, underserved markets, a significant portion of scheduled capacity in the third quarter of 2024 is allocated to new markets which the Company believes will drive higher RASM as they mature and industry capacity better aligns with demand. Fuel costs are expected to be
Full Year 2024
Capacity is expected to increase 5 to 7 percent compared to 2023 and adjusted (non-GAAP) pre-tax margin is expected to be (1.5) to 1.5 percent (excluding special items). Fuel costs are now expected to be
The current forward guidance estimates are presented in the following tables:
Third Quarter | |
2024(a) | |
Capacity growth (versus 3Q 2023)(b) | 4 to 6 percent |
Adjusted (non-GAAP) total operating expenses (excluding fuel) ($ millions)(c) | |
Average fuel cost per gallon(d) | |
Effective tax rate(e) | 23 percent |
Adjusted (non-GAAP) pre-tax margin | (3) to (6) percent |
Full Year | |
2024(a) | |
Capacity growth (versus 2023)(b) | 5 to 7 percent |
Average fuel cost per gallon(d) | |
Adjusted (non-GAAP) CASM (excluding fuel), stage-length adjusted to 1,000 miles (versus 2023)(c) | (1) to (2) percent |
Adjusted (non-GAAP) pre-tax margin | (1.5) to 1.5 percent |
Pre-delivery deposits, net of refunds ($ millions) | |
Other capital expenditures ($ millions)(f) |
_________________ | |
(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. Stage-length adjusted to 1,000 miles: Adjusted CASM (excluding fuel) * Square root (stage length / 1,000). |
(d) | Estimated fuel cost per gallon is based upon the blended jet fuel curve on August 5, 2024 and is inclusive of estimated fuel taxes and into-plane fuel costs. |
(e) | The Company's third quarter actual tax rate may differ from the forecasted rate due to varying factors which may include, but are not limited to, the composition of items of income and expense recognized, including the amount of non-deductible or other similar items including but not limited to a valuation allowance. |
(f) | Other capital expenditures estimate includes capitalized heavy maintenance. |
Conference Call
The Company will host a conference call to discuss second quarter 2024 results today, August 8, 2024, at 12:00 p.m. Eastern Time (
About Frontier Airlines
Frontier Airlines, Inc., a subsidiary of Frontier Group Holdings, Inc. (Nasdaq: ULCC), is committed to "Low Fares Done Right." Headquartered in
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; disruptions to the Company's flight operations, including due to factors beyond the Company's control, such as adverse weather events or air traffic controller staffing shortages; the Company's ability to attract and retain qualified personnel at reasonable costs; high and/or volatile fuel prices or significant disruptions in the supply of aircraft fuel, including as a result of the war between
Frontier Group Holdings, Inc. | |||||||||||
Condensed Consolidated Statements of Operations | |||||||||||
(unaudited, in millions, except share and per share data) | |||||||||||
Three Months Ended June 30, | Percent | Six Months Ended June 30, | Percent | ||||||||
2024 | 2023 | 2024 | 2023 | ||||||||
Operating revenues: | |||||||||||
Passenger | $ 950 | $ 945 | 1 % | $ 1,795 | $ 1,775 | 1 % | |||||
Other | 23 | 22 | 5 % | 43 | 40 | 8 % | |||||
Total operating revenues | 973 | 967 | 1 % | 1,838 | 1,815 | 1 % | |||||
Operating expenses: | |||||||||||
Aircraft fuel | 288 | 244 | 18 % | 551 | 536 | 3 % | |||||
Salaries, wages and benefits | 244 | 211 | 16 % | 477 | 414 | 15 % | |||||
Aircraft rent | 147 | 148 | (1) % | 306 | 279 | 10 % | |||||
Station operations | 163 | 124 | 31 % | 300 | 248 | 21 % | |||||
Maintenance, materials and repairs | 42 | 52 | (19) % | 91 | 97 | (6) % | |||||
Sales and marketing | 47 | 44 | 7 % | 87 | 84 | 4 % | |||||
Depreciation and amortization | 18 | 12 | 50 % | 34 | 23 | 48 % | |||||
Other operating | (1) | 53 | N/M | (2) | 80 | N/M | |||||
Total operating expenses | 948 | 888 | 7 % | 1,844 | 1,761 | 5 % | |||||
Operating income (loss) | 25 | 79 | (68) % | (6) | 54 | N/M | |||||
Other income (expense): | |||||||||||
Interest expense | (8) | (7) | 14 % | (17) | (13) | 31 % | |||||
Capitalized interest | 7 | 6 | 17 % | 16 | 12 | 33 % | |||||
Interest income and other | 8 | 10 | (20) % | 15 | 18 | (17) % | |||||
Total other income (expense) | 7 | 9 | (22) % | 14 | 17 | (18) % | |||||
Income (loss) before income taxes | 32 | 88 | (64) % | 8 | 71 | (89) % | |||||
Income tax expense (benefit) | 1 | 17 | (94) % | 3 | 13 | (77) % | |||||
Net income (loss) | $ 31 | $ 71 | (56) % | $ 5 | $ 58 | (91) % | |||||
Earnings (loss) per share: | |||||||||||
Basic (a) | $ 0.14 | $ 0.32 | (56) % | $ 0.02 | $ 0.26 | (92) % | |||||
Diluted (a) | $ 0.14 | $ 0.31 | (55) % | $ 0.02 | $ 0.26 | (92) % | |||||
Weighted-average common shares | |||||||||||
Basic (a) | 224,214,030 | 219,402,647 | 2 % | 223,822,565 | 218,792,850 | 2 % | |||||
Diluted (a) | 226,603,798 | 220,425,659 | 3 % | 226,203,376 | 220,223,273 | 3 % | |||||
__________________ | |
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 2.2 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 | Six Months Ended June 30, | Percent | ||||||||
2024 | 2023 | 2024 | 2023 | ||||||||
Operating statistics (a) | |||||||||||
Available seat miles ("ASMs") (millions) | 10,552 | 9,337 | 13 % | 19,998 | 18,112 | 10 % | |||||
Departures | 57,176 | 45,408 | 26 % | 105,842 | 88,120 | 20 % | |||||
Average stage length (miles) | 899 | 1,038 | (13) % | 925 | 1,045 | (11) % | |||||
Block hours | 147,506 | 128,854 | 14 % | 279,563 | 251,824 | 11 % | |||||
Average aircraft in service | 145 | 123 | 18 % | 141 | 122 | 16 % | |||||
Aircraft – end of period | 148 | 126 | 17 % | 148 | 126 | 17 % | |||||
Average daily aircraft utilization (hours) | 11.2 | 11.5 | (3) % | 10.9 | 11.4 | (4) % | |||||
Passengers (thousands) | 8,899 | 7,596 | 17 % | 15,904 | 14,422 | 10 % | |||||
Average seats per departure | 204 | 198 | 3 % | 203 | 197 | 3 % | |||||
Revenue passenger miles ("RPMs") (millions) | 8,238 | 7,964 | 3 % | 15,107 | 15,226 | (1) % | |||||
Load Factor | 78.1 % | 85.3 % | (7.2) pts | 75.5 % | 84.1 % | (8.6) pts | |||||
Fare revenue per passenger ($) | 39.91 | 47.59 | (16) % | 42.68 | 46.05 | (7) % | |||||
Non-fare passenger revenue per passenger ($) | 66.80 | 76.89 | (13) % | 70.15 | 77.06 | (9) % | |||||
Other revenue per passenger ($) | 2.54 | 2.75 | (8) % | 2.71 | 2.72 | — % | |||||
Total ancillary revenue per passenger ($) | 69.34 | 79.64 | (13) % | 72.86 | 79.78 | (9) % | |||||
Total revenue per passenger ($) | 109.25 | 127.23 | (14) % | 115.54 | 125.83 | (8) % | |||||
Total revenue per available seat mile ("RASM") (¢) | 9.21 | 10.35 | (11) % | 9.19 | 10.02 | (8) % | |||||
Cost per available seat mile ("CASM") (¢) | 8.98 | 9.51 | (6) % | 9.22 | 9.72 | (5) % | |||||
CASM (excluding fuel) (¢) (b) | 6.24 | 6.90 | (10) % | 6.46 | 6.77 | (5) % | |||||
CASM + net interest (¢) (b) | 8.90 | 9.41 | (5) % | 9.15 | 9.63 | (5) % | |||||
Adjusted CASM (¢) (b) | 8.98 | 9.51 | (6) % | 9.22 | 9.71 | (5) % | |||||
Adjusted CASM (excluding fuel) (¢) (b) | 6.24 | 6.90 | (10) % | 6.46 | 6.76 | (4) % | |||||
Adjusted CASM (excluding fuel), stage-length | 5.92 | 7.03 | (16) % | 6.21 | 6.91 | (10) % | |||||
Adjusted CASM + net interest (¢) (b) | 8.90 | 9.41 | (5) % | 9.15 | 9.62 | (5) % | |||||
Fuel cost per gallon ($) | 2.84 | 2.69 | 6 % | 2.88 | 3.06 | (6) % | |||||
Fuel gallons consumed (thousands) | 101,690 | 90,379 | 13 % | 191,347 | 174,966 | 9 % | |||||
Full-time equivalent employees | 8,100 | 6,692 | 21 % | 8,100 | 6,692 | 21 % | |||||
____________________ | |
(a) | Figures may not recalculate due to rounding. |
(b) | These metrics are not calculated in accordance with GAAP. For the reconciliation to corresponding GAAP measures, see "Reconciliation of CASM to CASM (excluding fuel), Adjusted CASM (excluding fuel), Adjusted CASM, Adjusted CASM including net interest and CASM including net interest." |
(c) | Stage-length adjusted to 1,000 miles: Adjusted CASM (excluding fuel) * Square root (stage length / 1,000). |
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 Pre-Tax Income (Loss) to Adjusted Pre-Tax Income (Loss) | |||||||
($ in millions) (unaudited) | |||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Net income (loss), as reported | $ 31 | $ 71 | $ 5 | $ 58 | |||
Non-GAAP Adjustments: | |||||||
Transaction and merger-related costs(a) | — | — | — | 1 | |||
Pre-tax impact | — | — | — | 1 | |||
Tax benefit (expense), related to non-GAAP adjustments | — | — | — | — | |||
Valuation allowance(b) | — | — | 5 | — | |||
Net income (loss) impact | $ — | $ — | 5 | 1 | |||
Adjusted net income (loss)(c) | $ 31 | $ 71 | $ 10 | $ 59 | |||
Income (loss) before income taxes, as reported | $ 32 | $ 88 | $ 8 | $ 71 | |||
Pre-tax impact | — | — | — | 1 | |||
Adjusted pre-tax income (loss)(c) | $ 32 | $ 88 | $ 8 | $ 72 | |||
____________________ | |
(a) | Represents |
(b) | During the six months ended June 30, 2024, a |
(c) | 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 (loss) and pre-tax income (loss) 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, | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Total operating expenses, as reported(a) | $ 948 | $ 888 | $ 1,844 | $ 1,761 | |||
Transaction and merger-related costs | — | — | — | (1) | |||
Adjusted total operating expenses(b) | 948 | 888 | 1,844 | 1,760 | |||
Aircraft fuel | (288) | (244) | (551) | (536) | |||
Adjusted total operating expenses (excluding fuel)(b) | $ 660 | $ 644 | $ 1,293 | $ 1,224 | |||
Total operating expenses, as reported | $ 948 | $ 888 | $ 1,844 | $ 1,761 | |||
Aircraft fuel | (288) | (244) | (551) | (536) | |||
Total operating expenses (excluding fuel)(b) | $ 660 | $ 644 | $ 1,293 | $ 1,225 | |||
__________________ | |
(a) | See "Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss) and Pre-Tax Income (Loss) to 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, | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Net income (loss) | $ 31 | $ 71 | $ 5 | $ 58 | |||
Plus (minus): | |||||||
Interest expense | 8 | 7 | 17 | 13 | |||
Capitalized interest | (7) | (6) | (16) | (12) | |||
Interest income and other | (8) | (10) | (15) | (18) | |||
Income tax expense (benefit) | 1 | 17 | 3 | 13 | |||
Depreciation and amortization | 18 | 12 | 34 | 23 | |||
EBITDA(a) | 43 | 91 | 28 | 77 | |||
Plus: Aircraft rent | 147 | 148 | 306 | 279 | |||
EBITDAR(b) | $ 190 | $ 239 | $ 334 | $ 356 | |||
EBITDA(a) | $ 43 | $ 91 | $ 28 | $ 77 | |||
Plus (minus)(c): | |||||||
Transaction and merger-related costs | — | — | — | 1 | |||
Adjusted EBITDA(a) | 43 | 91 | 28 | 78 | |||
Plus: Aircraft rent | 147 | 148 | 306 | 279 | |||
Adjusted EBITDAR(b) | $ 190 | $ 239 | $ 334 | $ 357 | |||
__________________ | |
(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 Pre-Tax Income (Loss) to 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, | |||||||
2024 | 2023 | ||||||
($ in millions) | Per ASM (¢) | ($ in millions) | Per ASM (¢) | ||||
CASM(a) | 8.98 | 9.51 | |||||
Aircraft fuel | (288) | (2.74) | (244) | (2.61) | |||
CASM (excluding fuel)(b) | 6.24 | 6.90 | |||||
Adjusted CASM (excluding fuel)(b) | 6.24 | 6.90 | |||||
Aircraft fuel | 288 | 2.74 | 244 | 2.61 | |||
Adjusted CASM(c) | 8.98 | 9.51 | |||||
Net interest expense (income) | (7) | (0.08) | (9) | (0.10) | |||
Adjusted CASM + net interest(d) | 8.90 | 9.41 | |||||
CASM | 8.98 | 9.51 | |||||
Net interest expense (income) | (7) | (0.08) | (9) | (0.10) | |||
CASM + net interest(d) | 8.90 | 9.41 | |||||
_______________________ | |
(a) | Cost per ASM figures may not recalculate due to rounding. During the three months ended June 30, 2024 and 2023, there were no non-GAAP adjustments. |
(b) | 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. |
(c) | 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. |
(d) | 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, | |||||||
2024 | 2023 | ||||||
($ in millions) | Per ASM (¢) | ($ in millions) | Per ASM (¢) | ||||
CASM(a)(b) | 9.22 | 9.72 | |||||
Aircraft fuel | (551) | (2.76) | (536) | (2.95) | |||
CASM (excluding fuel)(c) | 6.46 | 6.77 | |||||
Transaction and merger-related costs | — | — | (1) | (0.01) | |||
Adjusted CASM (excluding fuel)(c) | 6.46 | 6.76 | |||||
Aircraft fuel | 551 | 2.76 | 536 | 2.95 | |||
Adjusted CASM(d) | 9.22 | 9.71 | |||||
Net interest expense (income) | (14) | (0.07) | (17) | (0.09) | |||
Adjusted CASM + net interest(e) | 9.15 | 9.62 | |||||
CASM | 9.22 | 9.72 | |||||
Net interest expense (income) | (14) | (0.07) | (17) | (0.09) | |||
CASM + net interest(e) | 9.15 | 9.63 | |||||
_______________________ | |
(a) | Cost per ASM figures may not recalculate due to rounding. |
(b) | See "Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss) and Pre-Tax Income (Loss) to 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 Earnings (Loss) per Share, Diluted to Adjusted Earnings (Loss) per Share, Diluted | |||||||
(unaudited) | |||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||
2024 | 2023 | 2024 | 2023 | ||||
Earnings (loss) per share, diluted, as reported(a)(b) | $ 0.14 | $ 0.31 | $ 0.02 | $ 0.26 | |||
Tax benefit (expense), related to non-GAAP adjustments | — | — | — | — | |||
Valuation allowance | — | — | 0.03 | — | |||
Adjusted earnings (loss) per share, diluted(c) | $ 0.14 | $ 0.31 | $ 0.05 | $ 0.26 | |||
______________________ | |
(a) | See "Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss) and Pre-Tax Income (Loss) to Adjusted Pre-tax Income (Loss)" above for discussion on adjusting items. |
(b) | Cost per share figures may not recalculate due to rounding. |
(c) | Adjusted earnings (loss) per share is included a2s a supplemental disclosure because the Company believes it is a useful indicator of operating performance. Derivations of net income are well-recognized performance measurements in the airline industry that are frequently used by management, as well as by investors, securities analysts and other interested parties in comparing the operating performance of companies in the industry. |
Adjusted earnings (loss) per share has limitations as an analytical tool. Adjusted earnings (loss) per share does not reflect the impact of certain cash charges resulting from matters the Company considers not to be indicative of ongoing operations and does not reflect the cash expenditures, or future requirements, for capital expenditures or contractual commitments, and other companies in the industry may calculate Adjusted earnings (loss) per share differently than the Company does, limiting its usefulness as a comparative measure. Because of these limitations, Adjusted earnings (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 earnings (loss) per share, as presented may not be directly comparable to similarly titled measures presented by other companies. For the foregoing reasons, Adjusted earnings (loss) per share has significant limitations which affect its use as an indicator of profitability. Accordingly, you are cautioned not to place undue reliance on this information. | |
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SOURCE Frontier Group Holdings, Inc.
FAQ
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