Frontier Group Holdings, Inc., parent company of Frontier Airlines,
Inc. (NASDAQ: ULCC), today reported its financial results for the
second quarter of 2021.
Frontier experienced strengthening demand for leisure travel
during the second quarter, with capacity, as measured by ASMs,
exceeding the levels achieved in the comparable pre-COVID quarter
in 2019. The Company was profitable on a GAAP basis and ended the
quarter with $936 million of unrestricted cash and cash
equivalents, the highest cash balance in the Company’s history.
Frontier is focused on positioning the airline to be an industry
leader in the recovery from the COVID-19 pandemic, and during the
quarter returned all of its aircraft and employees into service
across all of its stations.
Frontier had 109 aircraft at the end of the quarter, 11 percent
higher than the corresponding prior year period. The airline is
expected to take delivery of five additional A320neo aircraft in
the third quarter of 2021 with no aircraft expected to be delivered
in the fourth quarter. Frontier opened 15 new stations during the
second quarter of 2021 and operated over 400 flights per day during
the quarter, which was 10 percent higher than the comparable
pre-COVID quarter in 2019. While restoring the operation to
pre-pandemic levels, Frontier remained financially disciplined,
with the business ending the quarter in a very strong liquidity
position.
"I am extremely proud of our Frontier team for all of their hard
work, dedication and professionalism with our customers through the
pandemic and their commitment to our mission of Low Fares Done
Right," said Barry Biffle, Frontier's president and CEO. “During
the quarter, as the recovery in leisure travel progressed, our
capacity exceeded the comparable pre-COVID quarter and we leveraged
our financial discipline and relative cost advantage to be
profitable on a GAAP basis. Our focus on leisure travel, along with
the strength and resilience of our business model and available
liquidity, positions us to continue to be an industry leader in the
recovery.”
The following is a summary of select financial results for the
second quarter of 2021, including both GAAP and adjusted (Non-GAAP)
metrics. Please see “Reconciliation of Non-GAAP Financial
Information” on page 9 below.
(unaudited, in
millions, except for percentage and per share amounts) |
|
|
|
|
|
|
Three Months Ended June 30, |
|
|
2021 |
|
|
2020 |
|
|
2019 |
|
|
|
As Reported (GAAP) |
|
Adjusted (Non-GAAP) |
|
As Reported (GAAP) |
|
Adjusted (Non-GAAP) |
|
As Reported (GAAP) |
|
Adjusted (Non-GAAP) |
Total operating revenues |
|
$ |
550 |
|
|
$ |
550 |
|
|
$ |
194 |
|
|
$ |
194 |
|
|
$ |
637 |
|
|
$ |
637 |
|
Total operating expenses |
|
$ |
532 |
|
|
$ |
613 |
|
|
$ |
188 |
|
|
$ |
284 |
|
|
$ |
536 |
|
|
$ |
538 |
|
Net income (loss) |
|
$ |
19 |
|
|
$ |
(50 |
) |
|
$ |
17 |
|
|
$ |
(37 |
) |
|
$ |
81 |
|
|
$ |
79 |
|
Net income (loss) margin |
|
3.5 |
% |
|
(9.1 |
)% |
|
8.8 |
% |
|
(19.1 |
)% |
|
12.7 |
% |
|
12.4 |
% |
Diluted earnings (loss) per
share2 |
|
$ |
0.08 |
|
|
$ |
(0.24 |
) |
|
$ |
0.08 |
|
|
$ |
(0.19 |
) |
|
$ |
0.37 |
|
|
$ |
0.40 |
|
Recent Company Highlights:
- Frontier completed the second quarter of 2021 with
$936 million of unrestricted cash and cash equivalents, the
highest cash balance in the Company’s history.
- The Company reported $19 million of net income on a GAAP basis
during the quarter as the recovery in demand for air travel across
the U.S. continued to strengthen.
- Frontier's capacity during the quarter, as measured by ASMs,
exceeded the levels achieved in the comparable pre-COVID quarter in
2019.
- Frontier took delivery of five A320neo aircraft during the
quarter. This brings the airline's total fleet count to 109
aircraft, which is 11 percent higher than the prior year. Frontier
expects to take delivery of an additional five A320neo aircraft
during the third quarter of 2021, with no deliveries expected in
the fourth quarter.
- Frontier’s fleet continues to be the most fuel-efficient of all
major U.S. carriers when measured by ASMs per fuel gallon consumed,
generating over 100 ASMs per gallon during the second quarter of
2021.
- Frontier signed a letter of intent with two of its leasing
partners to add ten additional A321 aircraft through direct leases,
with deliveries expected to begin in the second half of 2022 and
continuing into the first half of 2023. The additional A321
aircraft will enable the Company to boost its ASM growth rate as
the recovery from the COVID-19 pandemic continues.
- The Company generated approximately $60 of ancillary revenue
per passenger, which was 6.1 percent higher than the ancillary
revenue per passenger generated during the comparable pre-COVID
quarter in 2019.
- Frontier added more leisure
destinations for customers for the second half of 2021, including a
significant expansion in its schedule in Orlando, Las Vegas and
Atlanta, with over 160 destinations collectively from these cities,
and further international expansion, including Antigua, Aruba,
Belize, Costa Rica, St. Maarten, and Turks and Caicos.
Cash and Liquidity:
Frontier ended the second quarter of 2021 with $936 million
of unrestricted cash and cash equivalents, including
$266 million of net proceeds from its IPO and
$171 million of additional payroll support program funding
provided by the U.S. government (consisting of $21 million
from PSP2 and $150 million from PSP3). As a result of the
strength of the Company’s liquidity position and the recovery in
demand for air travel across the U.S., Frontier allowed the
Treasury Loan facility draw down date of May 28, 2021 to lapse. The
Company expects to receive its $161 million current income tax
receivable later this year. The Company is focused on repaying the
$150 million outstanding under the Treasury Loan, thereby
unencumbering the Company’s co-branded credit card program and
related brand assets that are currently collateralizing the
Treasury Loan.
Revenue Performance
Total operating revenues for the second quarter of 2021 totaled
$550 million, an increase of 184 percent compared to the second
quarter of 2020 as the recovery from the COVID-19 pandemic
strengthened for leisure travel. Frontier had 81 percent more
average aircraft in service during the second quarter of 2021 as
compared to the prior year, with average daily aircraft utilization
recovering to over 10 hours per day and the fleet operating at an
80 percent load factor. Further improvement is expected to the
utilization and load factor levels achieved in the comparable
pre-COVID period as the recovery from the COVID-19 pandemic
continues. Frontier’s capacity during the quarter totaled 6,934
million ASMs and exceeded the 6,877 million ASMs achieved in the
comparable pre-COVID quarter in 2019. Frontier’s total revenue per
passenger totaled $98.06 during the quarter, with ancillary revenue
per passenger of $59.99, which was 6.1 percent higher than the
$56.52 of ancillary revenue per passenger generated during the
comparable pre-COVID quarter in 2019.
Cost Performance
Total operating expenses for the second quarter of 2021 totaled
$532 million, including $87 million of CARES Act credits and $6
million of early lease termination costs. The Company’s adjusted
total operating expense totaled $613 million, including $139
million of fuel expenses at an average cost per gallon of $2.03.
Frontier’s adjusted total operating expenses, excluding fuel,
totaled $474 million with a resulting adjusted CASM (excluding
fuel) of 6.84 cents during the quarter compared to 5.47 cents in
the second quarter of 2019. The Company's Adjusted CASM (excluding
fuel) was significantly improved from the second quarter of 2020,
including the benefit from lease payment deferrals, substantially
all of which have been repaid at the end of the second quarter of
2021. The Company's capacity during the second quarter of 2021
recovered to exceed the capacity in the comparable pre-COVID
quarter in 2019. As the recovery from the pandemic continues to
unfold and utilization levels normalize, the resulting capacity
benefit on the Company's fleet, which had 26 percent more aircraft
in service in the second quarter of 2021 compared to 2019, is
expected to favorably impact the Company's Adjusted CASM (excluding
fuel).
Fleet:
As of June 30, 2021, Frontier had a fleet of 109 Airbus
single-aisle aircraft, consisting of 68 A320neos, 18 A320ceos, 21
A321ceos, and 2 A319ceos. All aircraft in the fleet are financed
with operating leases that expire between 2021 and 2033. Frontier’s
fleet is the most fuel-efficient of all major U.S. carriers when
measured by ASMs per fuel gallon consumed. This fuel efficiency
reflects Frontier’s operation of a large number of aircraft with
new generation, fuel-efficient engines, lightweight seats, and an
efficient seating layout.
Frontier took delivery of five A320neo aircraft during the
quarter and expects to take delivery of an additional five A320neo
aircraft during the third quarter of 2021, with no deliveries
expected in the fourth quarter.
During July 2021, the Company signed a letter of intent with two
of its leasing partners to add ten additional A321 aircraft through
direct leases, with deliveries beginning in the second half of 2022
and continuing into the first half of 2023. The additional A321
aircraft will enable the Company to boost its ASM growth rate as
recovery from the COVID-19 pandemic continues.
Forward Guidance:
The third quarter and full year 2021 guidance items provided
below are based on the Company's current estimates and are 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. Frontier undertakes no duty to update any
forward-looking statements or estimates.
Looking forward to the third quarter, we continue our focus on
getting the airline back to full utilization as we enter 2022 while
remaining flexible to address any impact from the Delta variant on
our bookings. Within the last week, we have noted
softening in the level of bookings over seasonal norms that we
believe is directly related to the increased COVID-19 case numbers
associated with the Delta variant. The impact of the Delta variant
on bookings, and the duration of that impact, are difficult to
predict. As a result, the top end of our guidance range for net
income is being adjusted to breakeven providing us with a third
quarter net income (loss) margin range of 0 percent to (5) percent.
We are confident that as cases decline we will see a positive
impact on forward bookings. Our current forward guidance estimate
summarized in the table below takes the recent softening in
bookings we are seeing today into consideration.
|
|
Third Quarter |
|
|
2021 |
Capacity (versus 3Q
2019)(a) |
|
2 to 4% |
Adjusted total operating
expenses (excluding fuel) ($ millions)(b) |
|
$515 - $525 |
Average fuel cost per
gallon(c) |
|
$2.15 |
Effective tax rate |
|
24% |
Adjusted net income (loss)
margin range |
|
0% to (5)% |
|
|
|
|
|
Full Year |
|
|
2021 |
Pre-delivery deposits, net of
refunds – year over year change ($ millions) |
|
$20 |
Other capital expenditures ($
millions)(d) |
|
$60 to $80 |
__________________(a) The Company expects that
demand will continue to gradually recover as 2021 progresses and
will monitor and adjust capacity levels as appropriate. Given the
dynamic nature of the current demand environment, including any
impact from the Delta variant, the actual capacity adjustments made
by the Company may be different than what is currently
expected.(b) Amount estimated excludes fuel
expense and special items, which may include loss on disposal of
assets, early lease termination costs, special charges and credits,
and other items which are not estimable at this
time.(c) Fuel cost per gallon is inclusive of
estimated fuel taxes and into-plane fuel
costs.(d) Other capital expenditures estimate
includes capitalized heavy maintenance.
Investor Conference CallFrontier’s quarterly
earnings conference call is scheduled to be held today
(August 4, 2021) at 4:30 p.m. Eastern Time (USA). The
conference call will be broadcast live over the Internet. Investors
may listen to the live audio webcast on the investor relations
section of the Company's website at https://ir.flyfrontier.com. For
those who are not available for the live webcast, the call will be
archived and available for at least 30 days on the investor
relations section of the Company's website.
About Frontier Airlines:
Frontier Airlines (NASDAQ: ULCC) is committed to “Low Fares Done
Right.” Headquartered in Denver, Colorado, the Company operates
more than 100 A320 family aircraft and has the largest A320neo
fleet in the U.S. The use of these aircraft, Frontier’s seating
configuration, weight-saving tactics and baggage process have all
contributed to the airline’s average of 43 percent fuel savings
compared to other U.S. airlines (fuel savings is based on Frontier
Airlines’ 2019 fuel consumption per seat-mile compared to the
weighted average of major U.S. airlines), which makes Frontier the
most fuel-efficient U.S. airline. With over 140 new Airbus planes
on order, Frontier will continue to grow to deliver on the mission
of providing affordable travel across America.
End Notes:
1 “Cash burn” means change in cash and cash equivalents during
the period adjusted to exclude cash from CARES Act related debt,
payroll support program grant and employee retention credit
funding, net IPO proceeds and the cash impact of other special
items divided by the days in the period. The Company believes that
cash burn is a useful measure of liquidity consumed by its
business. Cash burn refers to periods where this amount is
negative; references to “cash positive” refers to the foregoing
definition when the foregoing calculation is positive. The
Company’s definition of “cash burn” and “cash positive” may not be
calculated in the same manner as similarly labeled statistics used
by other airlines for substantially the entire quarter.
2 As the Company’s initial public offering closed on April 6,
2021, share amounts included in the basic and diluted earnings
(loss) per share calculations for the second quarter of 2021 as
reflected in the Condensed Consolidated Statements of Operations
include the 15 million shares issued and sold by the Company as
part of its initial public offering for substantially the entire
quarter. The Company has 3.1 million warrants outstanding relating
to CARES Act funding that are not included in the diluted share
count in the current quarter as share settlement is anti-dilutive.
The warrants are expected to be part of the Company's diluted share
count under the treasury stock method in future quarters. In
addition, most of the Company's 9.2 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 are included as an adjustment to the
numerator of the Company's earnings per share calculation as they
participate in the Company's earnings.
Cautionary Statement Regarding Forward-Looking
Statements and Information:Certain statements in this
release, including statements regarding the Company’s outlook for
the third quarter 2021 and its earnings target range, should be
considered forward-looking statements within the meaning of the
Securities Act, the Exchange Act 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. Such forward-looking
statements are and will be subject to many risks and uncertainties
relating to the Company’s operations and business environment that
may cause actual results to differ materially from any future
results expressed or implied in such forward-looking statements.
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 us 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 factors including,
without limitation, the following: the adverse impacts of the
ongoing COVID-19 global 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; unfavorable economic and
political conditions in the states where we operate and globally;
the highly competitive nature of the global airline industry and
susceptibility of the industry to price discounting and changes in
capacity; high and/or volatile fuel prices or significant
disruptions in the supply of aircraft fuel; 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, harm to the
Company's brand; 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 single suppliers to
source a majority of its aircraft and certain parts, 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 we operate; 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 us to record impairments;
any damage to the Company's reputation or brand image; the
limitation of the Company's ability to use its net operating loss
carryforwards and certain other tax attributes to offset future
taxable income for U.S. federal income tax purposes; 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, 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 under "Risk
Factors" in the Company's reports and other documents filed with
the Securities and Exchange Commission (“SEC”), as well as other
risks and uncertainties set forth from time to time in the reports
we file with the SEC from time to time, including the Quarterly
Report on Form 10-Q being filed at or around the date hereof.
Frontier Group Holdings,
Inc.Condensed Consolidated Statements of
Operations(unaudited, in millions, except for per
share data)
|
|
Three Months Ended June 30, |
|
Percent Change |
|
Six Months Ended June 30, |
|
Percent Change |
|
|
2021 |
|
|
2020 |
|
|
2019 |
|
|
2021 vs. 2020 |
|
2021 vs. 2019 |
|
2021 |
|
|
2020 |
|
|
2019 |
|
|
2021 vs. 2020 |
|
2021 vs. 2019 |
Operating revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Passenger |
|
$ |
536 |
|
|
$ |
185 |
|
|
$ |
622 |
|
|
190 |
% |
|
(14 |
)% |
|
$ |
798 |
|
|
$ |
713 |
|
|
$ |
1,155 |
|
|
12 |
% |
|
(31 |
)% |
Other |
|
14 |
|
|
9 |
|
|
15 |
|
|
56 |
% |
|
(7 |
)% |
|
23 |
|
|
25 |
|
|
29 |
|
|
(8 |
)% |
|
(21 |
)% |
Total operating
revenues |
|
550 |
|
|
194 |
|
|
637 |
|
|
184 |
% |
|
(14 |
)% |
|
821 |
|
|
738 |
|
|
1,184 |
|
|
11 |
% |
|
(31 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aircraft fuel |
|
139 |
|
|
15 |
|
|
163 |
|
|
827 |
% |
|
(15 |
)% |
|
223 |
|
|
219 |
|
|
304 |
|
|
2 |
% |
|
(27 |
)% |
Salaries, wages and
benefits |
|
154 |
|
|
130 |
|
|
121 |
|
|
18 |
% |
|
27 |
% |
|
293 |
|
|
278 |
|
|
265 |
|
|
5 |
% |
|
11 |
% |
Aircraft rent |
|
133 |
|
|
48 |
|
|
92 |
|
|
177 |
% |
|
45 |
% |
|
271 |
|
|
151 |
|
|
174 |
|
|
79 |
% |
|
56 |
% |
Station operations |
|
107 |
|
|
23 |
|
|
86 |
|
|
365 |
% |
|
24 |
% |
|
177 |
|
|
119 |
|
|
161 |
|
|
49 |
% |
|
10 |
% |
Sales and marketing |
|
30 |
|
|
15 |
|
|
33 |
|
|
100 |
% |
|
(9 |
)% |
|
47 |
|
|
45 |
|
|
60 |
|
|
4 |
% |
|
(22 |
)% |
Maintenance materials and
repairs |
|
27 |
|
|
16 |
|
|
20 |
|
|
69 |
% |
|
35 |
% |
|
53 |
|
|
42 |
|
|
36 |
|
|
26 |
% |
|
47 |
% |
Depreciation and
amortization |
|
10 |
|
|
7 |
|
|
12 |
|
|
43 |
% |
|
(17 |
)% |
|
18 |
|
|
15 |
|
|
25 |
|
|
20 |
% |
|
(28 |
)% |
CARES Act credits |
|
(87 |
) |
|
(91 |
) |
|
— |
|
|
(4 |
)% |
|
NM |
|
(223 |
) |
|
(91 |
) |
|
— |
|
|
(145 |
)% |
|
NM |
Other operating |
|
19 |
|
|
25 |
|
|
9 |
|
|
(24 |
)% |
|
111 |
% |
|
36 |
|
|
60 |
|
|
27 |
|
|
(40 |
)% |
|
33 |
% |
Total operating
expenses |
|
532 |
|
|
188 |
|
|
536 |
|
|
183 |
% |
|
(1 |
)% |
|
895 |
|
|
838 |
|
|
1,052 |
|
|
7 |
% |
|
(15 |
)% |
Operating income
(loss) |
|
18 |
|
|
6 |
|
|
101 |
|
|
200 |
% |
|
(82 |
)% |
|
(74 |
) |
|
(100 |
) |
|
132 |
|
|
(26 |
)% |
|
NM |
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
(5 |
) |
|
(3 |
) |
|
(3 |
) |
|
67 |
% |
|
67 |
% |
|
(27 |
) |
|
(5 |
) |
|
(6 |
) |
|
440 |
% |
|
350 |
% |
Capitalized interest |
|
1 |
|
|
2 |
|
|
3 |
|
|
(50 |
)% |
|
(67 |
)% |
|
2 |
|
|
4 |
|
|
6 |
|
|
(50 |
)% |
|
(67 |
)% |
Interest income and other |
|
— |
|
|
1 |
|
|
4 |
|
|
(100 |
)% |
|
(100 |
)% |
|
— |
|
|
4 |
|
|
8 |
|
|
(100 |
)% |
|
(100 |
)% |
Total other income
(expense) |
|
(4 |
) |
|
— |
|
|
4 |
|
|
— |
% |
|
NM |
|
(25 |
) |
|
3 |
|
|
8 |
|
|
NM |
|
NM |
Income (loss) before income
taxes |
|
14 |
|
|
6 |
|
|
105 |
|
|
133 |
% |
|
(87 |
)% |
|
(99 |
) |
|
(97 |
) |
|
140 |
|
|
2 |
% |
|
NM |
Income tax expense
(benefit) |
|
(5 |
) |
|
(11 |
) |
|
24 |
|
|
(55 |
)% |
|
NM |
|
(27 |
) |
|
(50 |
) |
|
32 |
|
|
(46 |
)% |
|
NM |
Net income
(loss) |
|
$ |
19 |
|
|
$ |
17 |
|
|
$ |
81 |
|
|
12 |
% |
|
(77 |
)% |
|
$ |
(72 |
) |
|
$ |
(47 |
) |
|
$ |
108 |
|
|
53 |
% |
|
NM |
Earnings (loss) per
share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic (a) |
|
$ |
0.08 |
|
|
$ |
0.08 |
|
|
$ |
0.37 |
|
|
5 |
% |
|
(77 |
)% |
|
$ |
(0.35 |
) |
|
$ |
(0.23 |
) |
|
$ |
0.51 |
|
|
54 |
% |
|
NM |
Diluted (a) |
|
$ |
0.08 |
|
|
$ |
0.08 |
|
|
$ |
0.37 |
|
|
4 |
% |
|
(77 |
)% |
|
$ |
(0.35 |
) |
|
$ |
(0.23 |
) |
|
$ |
0.51 |
|
|
54 |
% |
|
NM |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic (a) |
|
214 |
|
|
199 |
|
|
199 |
|
|
8 |
% |
|
8 |
% |
|
207 |
|
|
199 |
|
|
199 |
|
|
4 |
% |
|
4 |
% |
Diluted (a) |
|
216 |
|
|
199 |
|
|
200 |
|
|
8 |
% |
|
8 |
% |
|
207 |
|
|
199 |
|
|
200 |
|
|
4 |
% |
|
4 |
% |
__________________(a) Reference End Note 2
within the previous section for discussion on basic and diluted
shares.
Frontier Group Holdings, Inc.Selected
Operating Statistics(unaudited) |
|
Three Months Ended June 30, |
|
Percent Change |
|
Six Months Ended June 30, |
|
Percent Change |
|
2021 |
|
|
2020 |
|
|
2019 |
|
|
2021 vs. 2020 |
|
2021 vs. 2019 |
|
2021 |
|
|
2020 |
|
|
2019 |
|
|
2021 vs. 2020 |
|
2021 vs. 2019 |
Available seat miles (ASMs)
(millions) |
6,934 |
|
|
1,549 |
|
|
6,877 |
|
|
348 |
% |
|
1 |
% |
|
11,526 |
|
|
8,689 |
|
|
13,097 |
|
|
33 |
% |
|
(12 |
)% |
Departures |
37,126 |
|
|
9,038 |
|
|
33,799 |
|
|
311 |
% |
|
10 |
% |
|
61,535 |
|
|
44,285 |
|
|
63,370 |
|
|
39 |
% |
|
(3 |
)% |
Average stage length (statute
miles) |
966 |
|
|
922 |
|
|
1,050 |
|
|
5 |
% |
|
(8 |
)% |
|
969 |
|
|
1,022 |
|
|
1,069 |
|
|
(5 |
)% |
|
(9 |
)% |
Block hours |
98,150 |
|
|
22,084 |
|
|
95,191 |
|
|
344 |
% |
|
3 |
% |
|
162,617 |
|
|
121,629 |
|
|
180,964 |
|
|
34 |
% |
|
(10 |
)% |
Average aircraft in
service |
107 |
|
|
59 |
|
|
85 |
|
|
81 |
% |
|
26 |
% |
|
102 |
|
|
78 |
|
|
84 |
|
|
31 |
% |
|
21 |
% |
Aircraft – end of period |
109 |
|
|
98 |
|
|
91 |
|
|
11 |
% |
|
20 |
% |
|
109 |
|
|
98 |
|
|
91 |
|
|
11 |
% |
|
20 |
% |
Average daily aircraft
utilization (hours) |
10.1 |
|
|
4.1 |
|
|
12.3 |
|
|
146 |
% |
|
(18 |
)% |
|
8.8 |
|
|
8.6 |
|
|
12.0 |
|
|
2 |
% |
|
(27 |
)% |
Passengers (thousands) |
5,602 |
|
|
868 |
|
|
5,692 |
|
|
545 |
% |
|
(2 |
)% |
|
8,855 |
|
|
5,850 |
|
|
10,576 |
|
|
51 |
% |
|
(16 |
)% |
Average seats per
departure |
193 |
|
|
186 |
|
|
192 |
|
|
4 |
% |
|
1 |
% |
|
193 |
|
|
191 |
|
|
192 |
|
|
1 |
% |
|
1 |
% |
Revenue passenger miles (RPMs)
(millions) |
5,544 |
|
|
841 |
|
|
6,048 |
|
|
559 |
% |
|
(8 |
)% |
|
8,755 |
|
|
6,156 |
|
|
11,392 |
|
|
42 |
% |
|
(23 |
)% |
Load Factor (%) |
80.0 |
% |
|
54.3 |
% |
|
87.9 |
% |
|
25.7 pts |
|
(7.9) pts |
|
76.0 |
% |
|
70.9 |
% |
|
87.0 |
% |
|
5.1 pts |
|
(11.0) pts |
Fare revenue per
passenger ($) |
38.07 |
|
|
143.20 |
|
|
55.52 |
|
|
(73 |
)% |
|
(31 |
)% |
|
35.41 |
|
|
58.70 |
|
|
55.05 |
|
|
(40 |
)% |
|
(36 |
)% |
Non-fare passenger revenue per
passenger ($) |
57.52 |
|
|
69.96 |
|
|
53.76 |
|
|
(18 |
)% |
|
7 |
% |
|
54.67 |
|
|
63.25 |
|
|
54.17 |
|
|
(14 |
)% |
|
1 |
% |
Other revenue per
passenger ($) |
2.47 |
|
|
10.47 |
|
|
2.76 |
|
|
(76 |
)% |
|
(11 |
)% |
|
2.59 |
|
|
4.23 |
|
|
2.76 |
|
|
(39 |
)% |
|
(6 |
)% |
Total revenue per
passenger ($) |
98.06 |
|
|
223.63 |
|
|
112.04 |
|
|
(56 |
)% |
|
(12 |
)% |
|
92.67 |
|
|
126.18 |
|
|
111.98 |
|
|
(27 |
)% |
|
(17 |
)% |
Total revenue per available
seat mile (RASM) (¢) |
7.92 |
|
|
12.55 |
|
|
9.27 |
|
|
(37 |
)% |
|
(15 |
)% |
|
7.12 |
|
|
8.50 |
|
|
9.04 |
|
|
(16 |
)% |
|
(21 |
)% |
Cost per available seat mile
(CASM) (¢) |
7.68 |
|
|
12.17 |
|
|
7.80 |
|
|
(37 |
)% |
|
(2 |
)% |
|
7.76 |
|
|
9.65 |
|
|
8.04 |
|
|
(20 |
)% |
|
(3 |
)% |
CASM (excluding fuel) (¢) |
5.67 |
|
|
11.22 |
|
|
5.44 |
|
|
(49 |
)% |
|
4 |
% |
|
5.83 |
|
|
7.13 |
|
|
5.72 |
|
|
(18 |
)% |
|
2 |
% |
CASM + net interest (¢) |
7.73 |
|
|
12.18 |
|
|
7.75 |
|
|
(37 |
)% |
|
— |
% |
|
7.98 |
|
|
9.61 |
|
|
7.98 |
|
|
(17 |
)% |
|
— |
% |
Adjusted CASM (¢) |
8.85 |
|
|
18.36 |
|
|
7.83 |
|
|
(52 |
)% |
|
13 |
% |
|
9.62 |
|
|
10.03 |
|
|
7.80 |
|
|
(4 |
)% |
|
23 |
% |
Adjusted CASM (excluding fuel)
(¢) |
6.84 |
|
|
17.11 |
|
|
5.47 |
|
|
(60 |
)% |
|
25 |
% |
|
7.68 |
|
|
8.10 |
|
|
5.49 |
|
|
(5 |
)% |
|
40 |
% |
Adjusted CASM + net interest
(¢) |
8.87 |
|
|
18.37 |
|
|
7.78 |
|
|
(52 |
)% |
|
14 |
% |
|
9.64 |
|
|
9.99 |
|
|
7.74 |
|
|
(4 |
)% |
|
25 |
% |
Fuel cost per gallon ($) |
2.03 |
|
|
1.06 |
|
|
2.29 |
|
|
92 |
% |
|
(11 |
)% |
|
1.97 |
|
|
2.58 |
|
|
2.25 |
|
|
(24 |
)% |
|
(12 |
)% |
Fuel gallons consumed
(thousands) |
68,564 |
|
|
13,970 |
|
|
70,811 |
|
|
391 |
% |
|
(3 |
)% |
|
113,065 |
|
|
84,933 |
|
|
134,876 |
|
|
33 |
% |
|
(16 |
)% |
Employees (FTE) |
5,154 |
|
|
5,071 |
|
|
4,582 |
|
|
2 |
% |
|
12 |
% |
|
5,154 |
|
|
5,071 |
|
|
4,582 |
|
|
2 |
% |
|
12 |
% |
Reconciliation of Non-GAAP Financial
Information
The Company is providing below a reconciliation of GAAP
financial information to the non-GAAP financial information
provided. The non-GAAP financial information is included to provide
supplemental disclosures because the Company believes they are
useful additional indicators of, among other things, its operating
and cost performance. Derivations of net income and CASM are
well-recognized performance measurements in the airline industry
that are frequently used by the Company’s management, as well as by
investors, securities analysts and other interested parties in
comparing the operating performance of companies in the airline
industry. These non-GAAP financial measures have limitations as
analytical tools. Because of these limitations, determinations of
the Company’s operating performance or CASM excluding unrealized
gains and losses, special items or other items should not be
considered in isolation or as a substitute for performance measures
calculated in accordance with GAAP. These non-GAAP financial
measures may be presented on a different basis than other companies
using similarly titled non-GAAP financial measures.
Reconciliation of Net Income (Loss) to Adjusted Net
Income (Loss)($ in millions)
(unaudited)
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2021 |
|
2020 |
|
2019 |
|
2021 |
|
2020 |
|
2019 |
Net income (loss), as
reported |
|
$ |
19 |
|
|
|
$ |
17 |
|
|
|
$ |
81 |
|
|
|
$ |
(72 |
) |
|
|
$ |
(47 |
) |
|
|
$ |
108 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
Fuel
expense |
|
|
|
|
|
|
|
|
|
|
|
|
Derivative de-designation and mark-to-market adjustment (a) |
|
— |
|
|
|
(5 |
) |
|
|
— |
|
|
|
— |
|
|
|
51 |
|
|
|
— |
|
|
Aircraft
Rent |
|
|
|
|
|
|
|
|
|
|
|
|
Early lease termination costs(b) |
|
5 |
|
|
|
— |
|
|
|
— |
|
|
|
9 |
|
|
|
— |
|
|
|
— |
|
|
Salaries, wages and
benefits |
|
|
|
|
|
|
|
|
|
|
|
|
Pilot phantom equity(c) |
|
— |
|
|
|
— |
|
|
|
(7 |
) |
|
|
— |
|
|
|
— |
|
|
|
8 |
|
|
Collective bargaining contract ratification(d) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
18 |
|
|
Flight attendant early out program(e) |
|
— |
|
|
|
— |
|
|
|
5 |
|
|
|
— |
|
|
|
— |
|
|
|
5 |
|
|
Depreciation and
amortization |
|
|
|
|
|
|
|
|
|
|
|
|
Early lease termination costs(b) |
|
1 |
|
|
|
— |
|
|
|
— |
|
|
|
1 |
|
|
|
— |
|
|
|
— |
|
|
Other operating
expenses |
|
|
|
|
|
|
|
|
|
|
|
|
Cares Act – grant amortization and employee retention
credits(f) |
|
(87 |
) |
|
|
(91 |
) |
|
|
— |
|
|
|
(223 |
) |
|
|
(91 |
) |
|
|
— |
|
|
Write-off of deferred registration statement costs due to
significant market uncertainty(g) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
7 |
|
|
|
— |
|
|
Interest
expense |
|
|
|
|
|
|
|
|
|
|
|
|
CARES Act – mark-to-market impact for warrants(h) |
|
2 |
|
|
|
— |
|
|
|
— |
|
|
|
22 |
|
|
|
— |
|
|
|
— |
|
|
Pre-tax impact |
|
(79 |
) |
|
|
(96 |
) |
|
|
(2 |
) |
|
|
(191 |
) |
|
|
(33 |
) |
|
|
31 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax benefit (expense) related
to non-GAAP adjustments(i) |
|
10 |
|
|
|
42 |
|
|
|
— |
|
|
|
40 |
|
|
|
18 |
|
|
|
(8 |
) |
|
Net income (loss) impact |
|
(69 |
) |
|
|
(54 |
) |
|
|
(2 |
) |
|
|
(151 |
) |
|
|
(15 |
) |
|
|
23 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income
(loss), non-GAAP |
|
$ |
(50 |
) |
|
|
$ |
(37 |
) |
|
|
$ |
79 |
|
|
|
$ |
(223 |
) |
|
|
$ |
(62 |
) |
|
|
$ |
131 |
|
|
__________________
(a) Due to the significant reduction in demand
resulting from the COVID-19 pandemic, future anticipated
consumption of fuel dropped significantly and the Company therefore
de-designated hedge accounting in March 2020 on the derivative
positions where the future consumption was not deemed probable,
which primarily related to the written put options on costless
collars. The amounts represent the charge from de-designation and
resulting mark to market impact on the quantities where consumption
was not deemed probable.(b) As a result of an
early termination and buyout agreement executed in May 2021 with
one of the Company’s lessors, Frontier was able to accelerate the
removal of the remaining four A319 aircraft from its
fleet. These aircraft were originally scheduled to return in
December 2021 and were instead returned or are scheduled to return
during the second and third quarters of 2021. The Company
incurred $6 million and $10 million in aircraft rent and
depreciation costs during the three and six months ended
June 30, 2021, respectively, relating to the acceleration and
resulting changes to its lease return
obligations.(c) Represents the impact of the
change in value and vesting of phantom equity units pursuant to the
Pilot Phantom Equity Plan. In accordance with the amended and
restated phantom equity agreement, the remaining phantom equity
obligation became fixed as of December 31, 2019 and is no longer
subject to valuation adjustments.(d) Represents
$15 million of costs related to a one-time contract ratification
incentive, plus $3 million in payroll-related taxes and certain
other compensation and benefits-related accruals earned through
March 31, 2019 and committed to by us as part of a tentative
agreement with the union representing our flight attendants that
was reached in March 2019 for a contract that was ratified and
became effective in May 2019, in addition to $4 million in pilot
vacation accrual adjustments during the fourth quarter of 2019 as a
result of the ratified agreement with the union representing our
pilots specifically tied to the implementation of a preferred
bidding system.(e) Represents expenses associated
with an early out program agreed to in 2019 with our flight
attendants, payable throughout 2019, 2020 and
2021.(f) Represents the recognition of
$81 million and $206 million of grant funding received
from the U.S. government for payroll support for the three and six
months ended June 30, 2021, respectively, pursuant to PSP2 and
PSP3, along with $6 million and $17 million, respectively of
employee retention credits the Company qualified for under the
CARES Act. The grant funding recognized from the U.S. government
for payroll support and employee retention credits were $86 million
and $5 million, respectively, for the three and six months
ended June 30, 2020.(g) Represents the
write-off of deferred initial public offering preparation costs
during the first quarter 2020 due to the impact of the COVID-19
pandemic and the resulting uncertainty on the Company’s ability to
access the capital markets. (h) Represents the
mark to market adjustment to the value of the warrants issued as
part of the funding provided under the CARES Act. This amount is a
component of interest expense. As a result of the IPO and the
resulting reclassification of warrants from liability based awards
to equity based awards, as of April 6, 2021, we no longer mark to
market the warrants.(i) Represents the tax impact
of the non-GAAP adjustments, taking into consideration the
non-deductibility of the warrant mark to market adjustments for tax
purposes.
Reconciliation of Total Operating Expenses to Adjusted
Total Operating Expenses($ in millions)
(unaudited)
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2021 |
|
|
2020 |
|
2019 |
|
|
2021 |
|
|
2020 |
|
|
2019 |
|
Total operating
expenses, as reported(a) |
|
$ |
532 |
|
|
$ |
188 |
|
$ |
536 |
|
|
$ |
895 |
|
|
$ |
838 |
|
|
$ |
1,052 |
|
Early lease termination
costs |
|
(6 |
) |
|
— |
|
|
|
(10 |
) |
|
— |
|
|
|
Cares Act – grant amortization
and employee retention credits |
|
87 |
|
|
91 |
|
|
|
223 |
|
|
91 |
|
|
|
Write-off of deferred
registration statement costs due to significant market
uncertainty |
|
— |
|
|
— |
|
|
|
— |
|
|
(7 |
) |
|
|
Derivative de-designation and
mark to market adjustment |
|
— |
|
|
5 |
|
|
|
— |
|
|
(51 |
) |
|
|
Pilot phantom equity |
|
|
|
|
|
7 |
|
|
|
|
|
|
(8 |
) |
Collective bargaining contract
ratification |
|
|
|
|
|
|
|
|
|
|
|
(18 |
) |
Flight attendant early out
program |
|
|
|
|
|
(5 |
) |
|
|
|
|
|
(5 |
) |
Adjusted total
operating expenses, non-GAAP |
|
$ |
613 |
|
|
$ |
284 |
|
$ |
538 |
|
|
$ |
1,108 |
|
|
$ |
871 |
|
|
$ |
1,021 |
|
__________________(a) See “Reconciliation of
Net Income (Loss) to Adjusted Net Income (Loss)” above for
discussion on adjusting items.
Reconciliation of EBITDA to EBITDAR and EBITDA to
Adjusted EBITDAR($ in millions)
(unaudited)
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2021 |
|
2020 |
|
2019 |
|
2021 |
|
2020 |
|
2019 |
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA, EBITDAR, Adjusted EBITDA and Adjusted EBITDAR
reconciliation (unaudited): |
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
$ |
19 |
|
|
|
$ |
17 |
|
|
|
$ |
81 |
|
|
|
$ |
(72 |
) |
|
|
$ |
(47 |
) |
|
|
$ |
108 |
|
|
Plus (minus): |
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
5 |
|
|
|
3 |
|
|
|
3 |
|
|
|
27 |
|
|
|
5 |
|
|
|
6 |
|
|
Capitalized interest |
(1 |
) |
|
|
(2 |
) |
|
|
(3 |
) |
|
|
(2 |
) |
|
|
(4 |
) |
|
|
(6 |
) |
|
Interest income and other |
— |
|
|
|
(1 |
) |
|
|
(4 |
) |
|
|
— |
|
|
|
(4 |
) |
|
|
(8 |
) |
|
Income tax expense (benefit) |
(5 |
) |
|
|
(11 |
) |
|
|
24 |
|
|
|
(27 |
) |
|
|
(50 |
) |
|
|
32 |
|
|
Depreciation and amortization |
10 |
|
|
|
7 |
|
|
|
12 |
|
|
|
18 |
|
|
|
15 |
|
|
|
25 |
|
|
EBITDA |
28 |
|
|
|
13 |
|
|
|
113 |
|
|
|
(56 |
) |
|
|
(85 |
) |
|
|
157 |
|
|
Plus: Aircraft rent |
133 |
|
|
|
48 |
|
|
|
92 |
|
|
|
271 |
|
|
|
151 |
|
|
|
174 |
|
|
EBITDAR |
$ |
161 |
|
|
|
$ |
61 |
|
|
|
$ |
205 |
|
|
|
$ |
215 |
|
|
|
$ |
66 |
|
|
|
$ |
331 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA |
$ |
28 |
|
|
|
$ |
13 |
|
|
|
$ |
113 |
|
|
|
$ |
(56 |
) |
|
|
$ |
(85 |
) |
|
|
$ |
157 |
|
|
Plus (minus)(a): |
|
|
|
|
|
|
|
|
|
|
|
Early lease termination costs |
5 |
|
|
|
— |
|
|
|
— |
|
|
|
9 |
|
|
|
— |
|
|
|
— |
|
|
Cares Act – grant amortization and employee retention credits |
(87 |
) |
|
|
(91 |
) |
|
|
— |
|
|
|
(223 |
) |
|
|
(91 |
) |
|
|
— |
|
|
Write-off of deferred registration statement costs due to
significant market uncertainty |
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
7 |
|
|
|
— |
|
|
Derivative de-designation and mark to market adjustment |
— |
|
|
|
(5 |
) |
|
|
— |
|
|
|
— |
|
|
|
51 |
|
|
|
— |
|
|
Pilot phantom equity |
— |
|
|
|
— |
|
|
|
(7 |
) |
|
|
— |
|
|
|
— |
|
|
|
8 |
|
|
Collective bargaining contract ratification |
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
18 |
|
|
Flight attendant early out program |
— |
|
|
|
— |
|
|
|
5 |
|
|
|
— |
|
|
|
— |
|
|
|
5 |
|
|
Adjusted
EBITDA |
(54 |
) |
|
|
(83 |
) |
|
|
111 |
|
|
|
(270 |
) |
|
|
(118 |
) |
|
|
188 |
|
|
Plus: Aircraft rent(b) |
128 |
|
|
|
48 |
|
|
|
92 |
|
|
|
262 |
|
|
|
151 |
|
|
|
174 |
|
|
Adjusted
EBITDAR |
$ |
74 |
|
|
|
$ |
(35 |
) |
|
|
$ |
203 |
|
|
|
$ |
(8 |
) |
|
|
$ |
33 |
|
|
|
$ |
362 |
|
|
__________________(a) See “Reconciliation of
Net Income (Loss) to Adjusted Net Income (Loss)” above for
discussion on adjusting items.(b) Represents
aircraft rent expense included in Adjusted EBITDA. Excludes
aircraft rent expense of $5 million and $9 million for the three
and six months ended June 30, 2021, respectively, for costs
incurred due to the early termination of our A319 leased aircraft.
See footnote (b) under the caption “Reconciliation of Net Income
(Loss) to Adjusted Net Income (Loss)”.
Reconciliation of CASM to Adjusted CASM (excluding fuel)
and Adjusted CASM including net interest
(unaudited)
|
Three Months Ended June 30, |
|
2021 |
|
|
2020 |
|
|
2019 |
|
|
($ in millions) |
|
Per ASM (¢) |
|
($ in millions) |
|
Per ASM (¢) |
|
($ in millions) |
|
Per ASM (¢) |
CASM(a)(b) |
|
|
7.68 |
|
|
|
|
12.17 |
|
|
|
|
7.80 |
|
Aircraft fuel |
(139 |
) |
|
(2.01 |
) |
|
(15 |
) |
|
(0.95 |
) |
|
(163 |
) |
|
(2.36 |
) |
CASM (excluding
fuel) |
|
|
5.67 |
|
|
|
|
11.22 |
|
|
|
|
5.44 |
|
Early lease termination
costs |
(6 |
) |
|
(0.08 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Cares Act - grant amortization
and employee credits |
87 |
|
|
1.25 |
|
|
91 |
|
|
5.89 |
|
|
— |
|
|
— |
|
Pilot phantom equity |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
7 |
|
|
0.10 |
|
Flight attendant early out
program |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(5 |
) |
|
(0.07) |
|
Adjusted CASM
(excluding fuel) |
|
|
6.84 |
|
|
|
|
17.11 |
|
|
|
|
5.47 |
|
Aircraft fuel |
139 |
|
|
2.01 |
|
|
15 |
|
|
0.95 |
|
|
163 |
|
|
2.36 |
|
Derivative de-designation and
mark to market adjustment |
— |
|
|
— |
|
|
5 |
|
|
0.30 |
|
|
— |
|
|
— |
|
Adjusted
CASM |
|
|
8.85 |
|
|
|
|
18.36 |
|
|
|
|
7.83 |
|
Net interest expense
(income) |
4 |
|
|
0.05 |
|
|
— |
|
|
0.01 |
|
|
(4 |
) |
|
(0.05 |
) |
CARES Act – mark to market
impact for warrants |
(2 |
) |
|
(0.03) |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Adjusted CASM + net
interest |
|
|
8.87 |
|
|
|
|
18.37 |
|
|
|
|
7.78 |
|
|
|
|
|
|
|
|
|
|
|
|
|
CASM |
|
|
7.68 |
|
|
|
|
12.17 |
|
|
|
|
7.80 |
|
Net interest expense
(income) |
4 |
|
|
0.05 |
|
|
— |
|
|
0.01 |
|
|
(4 |
) |
|
(0.05 |
) |
CASM + net
interest |
|
|
7.73 |
|
|
|
|
12.18 |
|
|
|
|
7.75 |
|
__________________
(a) Cost per ASM figures may not recalculate
due to rounding(b) See “Reconciliation of Net
Income (Loss) to Adjusted Net Income (Loss)” above for discussion
on adjusting items.
|
Six Months Ended June 30, |
|
2021 |
|
|
2020 |
|
|
2019 |
|
|
($ in millions) |
|
Per ASM (¢) |
|
($ in millions) |
|
Per ASM (¢) |
|
($ in millions) |
|
Per ASM (¢) |
CASM(a)(b) |
|
|
7.76 |
|
|
|
|
9.65 |
|
|
|
|
8.04 |
|
Aircraft fuel |
(223 |
) |
|
(1.93 |
) |
|
(219 |
) |
|
(2.52 |
) |
|
(304 |
) |
|
(2.32 |
) |
CASM (excluding
fuel) |
|
|
5.83 |
|
|
|
|
7.13 |
|
|
|
|
5.72 |
|
Early lease termination
costs |
(10 |
) |
|
(0.08 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Cares Act - grant amortization
and employee credits |
223 |
|
|
1.93 |
|
|
|
91 |
|
|
1.05 |
|
|
|
— |
|
|
— |
|
|
Write-off of deferred
registration statement costs due to significant market
uncertainty |
— |
|
|
— |
|
|
|
(7 |
) |
|
|
(0.08 |
) |
|
|
— |
|
|
— |
|
|
Pilot phantom equity |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(8 |
) |
|
(0.06 |
) |
Collective bargaining contract
ratification |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(18 |
) |
|
(0.14 |
) |
Flight attendant early out
program |
— |
|
|
— |
|
|
|
— |
|
|
— |
|
|
|
(5 |
) |
|
(0.03 |
) |
|
Adjusted CASM
(excluding fuel) |
|
|
7.68 |
|
|
|
|
8.10 |
|
|
|
|
5.49 |
|
Aircraft fuel |
223 |
|
|
1.94 |
|
|
219 |
|
|
2.52 |
|
|
304 |
|
|
2.31 |
|
Derivative de-designation and
mark to market adjustment |
— |
|
|
— |
|
|
|
(51 |
) |
|
(0.59 |
) |
|
|
— |
|
|
— |
|
|
Adjusted
CASM |
|
|
9.62 |
|
|
|
|
10.03 |
|
|
|
|
7.80 |
|
Net interest expense
(income) |
25 |
|
|
0.22 |
|
|
(3 |
) |
|
(0.04 |
) |
|
(8 |
) |
|
(0.06 |
) |
CARES Act – mark to market
impact for warrants |
(22 |
) |
|
(0.20 |
) |
|
|
— |
|
|
— |
|
|
|
— |
|
|
— |
|
|
Adjusted CASM + net
interest |
|
|
9.64 |
|
|
|
|
9.99 |
|
|
|
|
7.74 |
|
|
|
|
|
|
|
|
|
|
|
|
|
CASM |
|
|
7.76 |
|
|
|
|
9.65 |
|
|
|
|
8.04 |
|
Net interest expense
(income) |
25 |
|
|
0.22 |
|
|
(3 |
) |
|
(0.04 |
) |
|
(8 |
) |
|
(0.06 |
) |
CASM + net
interest |
|
|
7.98 |
|
|
|
|
9.61 |
|
|
|
|
7.98 |
|
__________________(a) Cost per ASM figures may
not recalculate due to rounding(b) See
“Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss)”
above for discussion on adjusting items.
The calculation of Adjusted CASM including net interest provided
in the tables above reflects the sum of Adjusted CASM and net
interest expense (income) excluding special items per ASM. Adjusted
CASM including net interest is included as a supplemental
disclosure because the Company believes it is a useful metric 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
this metric is a useful comparator because it removes certain items
that may not be indicative of base operating performance or future
results. Adjusted CASM including net interest 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.
Contacts:
Jennifer F. de la Cruz
Corporate Communications
Email: JenniferF.Delacruz@flyfrontier.com
Phone: 720.374.4207
Susan M. Donofrio
Investor Relations
Email: investorrelations@flyfrontier.com
Phone: 917.518.1378
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