HONOLULU, April 26, 2022
/PRNewswire/ -- Hawaiian Holdings, Inc. (NASDAQ: HA) (the
"Company"), parent company of Hawaiian Airlines, Inc.
("Hawaiian"), today reported its financial results for the first
quarter of 2022.
"Strong demand for leisure travel to Hawai'i is poised to propel
our domestic revenue to record levels as the effects of the
pandemic are more muted now than at any point in the past two
years. Based on these trends, we anticipate a resurgence of
international demand as restrictive travel policies continue to
loosen" said Peter Ingram, Hawaiian
Airlines President and CEO. "I am extremely proud of our wonderful
team who are committed to connecting people with aloha."
Financial Results
First Quarter 2022
- The Company reported a GAAP net loss of $(122.8) million, and an adjusted net loss of
$(130.3) million.
- The Company reported a GAAP EPS of $(2.39), and an adjusted EPS of $(2.54).
- The Company reported EBITDA of $(96.0)
million, and adjusted EBITDA of $(105.5) million.
First Quarter 2022 Highlights
Revenue Environment
The Company experienced strengthening demand throughout its
domestic network as the impacts of Omicron eased through the
quarter and COVID-19 restrictions for travel to the State of
Hawai'i were lifted at the end of March. The Company's
domestic premium products performed exceptionally well during the
quarter, with both business/first class revenue and Extra Comfort
revenue exceeding 2019 levels. The Company's overall
operating revenue is down 27% from first quarter 2019 as its
international network is still rebuilding.
Other revenue was up 32% compared to the first quarter of 2019
driven by a record quarter of cargo revenue and the highest first
quarter revenue from HawaiianMiles sales.
Routes and Network
In March 2022, the Company
announced the return of daily nonstop service between Oakland, California and Kona, Hawai'i from
June 15, 2022 to September 6, 2022. The Company will also be
adding a second daily flight between San
Francisco, California and Honolulu, Hawai'i from May 15, 2022 to August
1, 2022.
In April 2022, the Company
announced the resumption of three-times-weekly nonstop service
between Auckland, New Zealand and
Honolulu, Hawai'i starting
July 2, 2022 and a seasonal increase
in frequency between Seoul, South
Korea and Honolulu for the
summer of 2022.
During the first quarter of 2022, the Company operated at 88% of
its 2019 first quarter system capacity, comprised of 118%, 75% and
25% capacity on its North America,
Neighbor Island and International routes, respectively.
The State of Hawai'i ended its Safe Travels Hawai'i restrictions
on March 25, 2022, removing the
requirement that domestic travelers complete a Safe Travels
application, which included providing either proof of COVID-19
vaccination or a pre-travel negative COVID-19 test result, in order
to avoid a required quarantine period upon entering Hawai'i.
Countries in the Company's international network made several
positive changes to their respective travel restrictions including
the following:
- Australia lifted its remaining
travel restrictions for visitors in February
2022 (restrictions were previously lifted for Australian
citizens in December 2021);
- South Korea lifted quarantine
restrictions with proof of vaccination, requiring only a negative
COVID-19 test within 48 hours of travel beginning April 1, 2022;
- Japan ceased government
required quarantine and increased allowable daily visitor arrivals
to 10,000 beginning April 10, 2022;
and
- Starting May 1, 2022,
New Zealand's borders will reopen
to vaccinated visitors from visa waiver countries, including
the United States.
Liquidity and Capital Resources
As of March 31, 2022, the Company had:
- Unrestricted cash, cash equivalents and short-term investments
of $1.6 billion
- $1.9 billion in liquidity,
including its undrawn $235 million
revolving credit facility
- Outstanding debt and finance lease obligations of $1.9 billion
- Air traffic liability of $761
million
Operational Excellence
The Company maintained its #1 national ranking for On-Time
Performance for the 18th consecutive year in 2021, as reported in
the U.S. Department of Transportation (DOT) Air Travel Consumer
Report.
In March 2022, the Company opened
a 3,000 square-foot line maintenance facility at Long Beach Airport
in California to expand space for
its aircraft mechanics to perform maintenance on its A321neo fleet
which will enable greater operational flexibility.
In April 2022, the Company
announced an agreement with SpaceX to deploy its Starlink satellite
internet service on its long haul aircraft. The Company expects to
launch complimentary inflight connectivity in 2023.
People
In February 2022, the Company's
employees represented by the International Association of
Machinists and Aerospace Workers ratified five-year contracts that
provide for wage increases and important work rule changes for
nearly 2,500 employees.
In April 2022, the Company's
employees represented by the Transport Workers Union of America
ratified a five-year contract that provides wage increases and
important work rule changes for 55 employees.
In March 2022, the Company
launched a statewide hiring campaign to recruit for hundreds of
airport and operational positions, as well as administrative roles,
to support the Company as it rebuilds its network back to 2019
levels.
Environmental, Social and Corporate Governance
The Company continues to focus on creating long-term value and
positively impacting the people, the environment and the
communities it serves. The Company will publish its third annual
Corporate Kuleana report in May 2022,
highlighting its Environmental, Social, and Governance
commitments.
In April 2022, the Company
announced a new a partnership with Conservation International,
which provides guests with the opportunity to purchase certified
carbon offsets to offset their Hawaiian Airlines flight's carbon
emissions. The Company has also committed to offsetting all future
business travel by its employees on Hawaiian's
flights.
Second Quarter 2022 Outlook
The Company expects its capacity for the quarter ending
June 30, 2022 to be down
approximately 11.5% to 14.5% compared to the second quarter of
2019, mostly driven by the delay of the full restoration of its
Japan network.
The Company expects its total revenue for the quarter ending
June 30, 2022 to sequentially improve
from the first quarter and be down approximately 8% to 12% compared
to the second quarter of 2019 due to strong demand throughout its
network.
The Company expects its CASM excluding fuel and non-recurring
items for the quarter ending June 30,
2022 to be consistent with the first quarter at up
approximately 16.5% to 19.5% compared to the second quarter of
2019.
The Company's outlook of adjusted EBITDA for the quarter ending
June 30, 2022 is $(50) million to $10
million, which reflects the resilient demand for Hawai'i
travel as the Company continues to rebuild its network.
The table below summarizes the Company's expectations for the
quarter ending June 30, 2022
expressed as an expected percentage change compared to the results
for the quarter ended June 30,
2019.
Item
|
|
Second Quarter
2022 Guidance
|
|
GAAP
Equivalent
|
|
GAAP Second
Quarter 2022
Guidance
|
ASMs
|
|
Down 11.5% to
14.5%
|
|
|
|
|
Total
Revenue
|
|
Down 8% to
12%
|
|
|
|
|
Costs per ASM
excluding fuel and
non-recurring items (a)
|
|
Up 16.5% to
19.5%
|
|
Costs per ASM
(a)
|
|
Up 27.8% to
30.2%
|
Gallons of Jet
Fuel Consumed
|
|
Down 14.5% to
17.5%
|
|
|
|
|
Fuel Price per
Gallon (b)
|
|
$3.59
|
|
|
|
|
Adjusted EBITDA
(c)
|
|
$(50) million to $10
million
|
|
Net Income
(c)
|
|
|
Effective Tax
Rate
|
|
~21%
|
|
|
|
|
(a)
|
See Table 3 for a
reconciliation of GAAP operating expenses to operating expenses
excluding fuel and non-recurring items.
|
(b)
|
Fuel Price per Gallon
estimates are based on the April 21, 2022 fuel forward
curve.
|
(c)
|
The Company is not
providing a reconciliation of adjusted EBITDA to GAAP net income,
the most directly comparable GAAP measure, as it is unable, without
unreasonable efforts, to calculate certain special and
non-recurring charges, which could have a significant impact on the
GAAP measure.
|
Statistical information, as well as a reconciliation of certain
non-GAAP financial measures, can be found in the accompanying
tables.
Full Year 2022 Outlook
The Company is suspending guidance for the year ending
December 31, 2022 due to the
continuing uncertainty surrounding the timing of the full
resumption of its international network due to foreign government
travel restrictions. The Company intends to resume providing full
year guidance when there is greater clarity related to its
international markets.
Investor Conference Call
Hawaiian Holdings' quarterly results conference call is
scheduled to begin today, April 26, 2022, at 4:30 p.m. Eastern Time (USA). The conference call will be
broadcast live over the Internet. Investors may access and listen
to the live audio webcast on the investor relations section of the
Company's website at HawaiianAirlines.com. For those who are
not available for the live webcast, a replay of the webcast will be
archived for 90 days on the investor relations section of the
Company's website.
About Hawaiian Airlines
Hawaiian® has led all U.S. carriers in on-time performance for
each of the past 18 years (2004-2021) reported by the U.S.
Department of Transportation and was named the #1 U.S. airline by
Condé Nast Traveler's 2021 Readers Choice Awards. Consumer surveys
by Travel + Leisure and TripAdvisor have placed Hawaiian among the
top of all domestic airlines serving Hawai'i.
Now in its 93rd year of continuous service, Hawaiian is
Hawaiʻi's biggest and longest-serving airline. Hawaiian offers
approximately 130 daily flights within the Hawaiian Islands, daily
nonstop flights between Hawaiʻi and 16 U.S. gateway cities – more
than any other airline – as well as service connecting Honolulu and American Samoa, Australia, Japan, New
Zealand, South Korea and
Tahiti.
The airline is committed to connecting people with aloha by
offering complimentary meals for all guests on transpacific routes
and the convenience of no change fees on Main Cabin and Premium
Cabin seats. HawaiianMiles members also enjoy flexibility with
miles that never expire. As Hawai'i's hometown airline, Hawaiian
encourages guests to Travel Pono and experience the islands safely
and respectfully.
Hawaiian Airlines, Inc. is a subsidiary of Hawaiian Holdings,
Inc. (NASDAQ: HA). Additional information is available at
HawaiianAirlines.com. Follow Hawaiian's Twitter updates
(@HawaiianAir), become a fan on Facebook (Hawaiian Airlines), and
follow us on Instagram (hawaiianairlines). For career postings and
updates, follow Hawaiian's LinkedIn page.
For media inquiries, please visit Hawaiian Airlines' online
newsroom.
Forward-Looking Statements
This press release contains "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995
that reflect the Company's current views with respect to certain
current and future events and financial performance. Such
forward-looking statements include, without limitation, the
Company's ability, timing and progress in recovering from the
impacts of COVID-19 pandemic; future domestic and international
demand for air travel; the Company's future routes and network
changes; changes to COVID-19 related travel restrictions in various
jurisdictions; operational flexibility generated from the Company's
line maintenance base in Long Beach Station; the Company's
in-flight connectivity partnership with SpaceX; the Company's
statewide hiring campaign; the Company's environmental commitments,
including related to emissions and offsets; the Company's timing
for publishing its Kuleana report; the Company's outlook for the
first fiscal quarter and resumption of the Company's fiscal year
2022; and statements as to other matters that do not relate
strictly to historical facts or statements of assumptions
underlying any of the foregoing. Words such as "expects,"
"anticipates," "projects," "intends," "plans," "believes,"
"estimates," variations of such words, and similar expressions are
also intended to identify such forward-looking statements.
These forward-looking statements are and will be subject to many
risks, uncertainties and assumptions relating to the Company's
operations and business environment, all of which may cause the
Company's actual results to be materially different from any future
results, expressed or implied, in these forward-looking
statements. These risks and uncertainties include, without
limitation, the continuing and developing effects of the spread of
COVID-19 on the Company's business operations and financial
condition; whether the Company's cost-cutting plans related to the
COVID-19 pandemic will be effective or sufficient; the duration of
government-mandated and other restrictions on travel; the full
effect that the quarantine, restrictions on travel and other
measures to limit the spread of COVID-19 will have on demand for
air travel in the markets in which the Company operates;
fluctuations and the extent of declining demand for air
transportation in the markets in which the Company operates; the
Company's dependence on the tourism industry; the Company's ability
to generate sufficient cash and manage its available cash; the
Company's ability to accurately forecast economic volatility;
macroeconomic developments; political developments; geopolitical
conflict; the price and availability of aircraft fuel; labor
negotiations; supply chain constraints; regulatory determinations
and related developments; competitive pressures, including the
impact of industry capacity between North
America and Hawai'i and interisland; changes in the
Company's future capital needs; and foreign currency exchange rate
fluctuations.
The risks, uncertainties and assumptions referred to above that
could cause the Company's results to differ materially from the
results expressed or implied by such forward-looking statements
also include the risks, uncertainties and assumptions discussed
from time to time in the Company's other public filings and public
announcements, including the Company's Annual Report on Form 10-K
and the Company's Quarterly Reports on Form 10-Q, as well as other
documents that may be filed by the Company from time to time with
the Securities and Exchange Commission. All forward-looking
statements included in this document are based on information
available to the Company on the date hereof. The Company does
not undertake to publicly update or revise any forward-looking
statements to reflect events or circumstances that may arise after
the date hereof even if experience or future changes make it clear
that any projected results expressed or implied herein will not be
realized.
Table
1.
Hawaiian
Holdings, Inc.
Consolidated
Statements of Operations (unaudited)
|
|
|
|
Three Months Ended
March 31,
|
|
|
2022
|
|
2021
|
|
%
Change
|
|
|
(in thousands,
except per share data)
|
Operating
Revenue:
|
|
|
|
|
|
|
Passenger
|
|
$
404,029
|
|
$
137,469
|
|
193.9%
|
Other
|
|
73,185
|
|
44,748
|
|
63.5%
|
Total
|
|
477,214
|
|
182,217
|
|
161.9%
|
Operating
Expenses:
|
|
|
|
|
|
|
Wages and
benefits
|
|
203,099
|
|
160,079
|
|
26.9%
|
Aircraft fuel,
including taxes and delivery
|
|
150,982
|
|
47,736
|
|
216.3%
|
Maintenance, materials
and repairs
|
|
55,650
|
|
34,252
|
|
62.5%
|
Aircraft and passenger
servicing
|
|
33,815
|
|
17,251
|
|
96.0%
|
Depreciation and
amortization
|
|
33,755
|
|
35,356
|
|
(4.5)%
|
Commissions and other
selling
|
|
20,647
|
|
11,409
|
|
81.0%
|
Aircraft
rent
|
|
26,276
|
|
29,841
|
|
(11.9)%
|
Other rentals and
landing fees
|
|
34,611
|
|
19,668
|
|
76.0%
|
Purchased
services
|
|
30,687
|
|
24,097
|
|
27.3%
|
Government grant
recognition
|
|
—
|
|
(147,270)
|
|
(100.0)%
|
Other
|
|
35,497
|
|
22,962
|
|
54.6%
|
Total
|
|
625,019
|
|
255,381
|
|
144.7%
|
Operating
Loss
|
|
(147,805)
|
|
(73,164)
|
|
102.0%
|
Nonoperating
Income (Expense):
|
|
|
|
|
|
|
Interest expense and
amortization of debt discounts and issuance costs
|
|
(25,037)
|
|
(23,693)
|
|
|
Interest
income
|
|
4,434
|
|
1,249
|
|
|
Capitalized
interest
|
|
1,052
|
|
684
|
|
|
Gains on fuel
derivatives
|
|
—
|
|
217
|
|
|
Loss on extinguishment
of debt
|
|
—
|
|
(3,994)
|
|
|
Other components of
net periodic benefit cost
|
|
1,286
|
|
981
|
|
|
Other, net
|
|
11,246
|
|
20,896
|
|
|
Total
|
|
(7,019)
|
|
(3,660)
|
|
|
Loss Before Income
Taxes
|
|
(154,824)
|
|
(76,824)
|
|
|
Income tax
benefit
|
|
(32,015)
|
|
(16,133)
|
|
|
Net
Loss
|
|
$
(122,809)
|
|
$
(60,691)
|
|
|
Net Loss Per
Share
|
|
|
|
|
|
|
Basic
|
|
$
(2.39)
|
|
$
(1.23)
|
|
|
Diluted
|
|
$
(2.39)
|
|
$
(1.23)
|
|
|
Weighted Average
Number of Common Stock Shares Outstanding:
|
|
|
|
|
|
|
Basic
|
|
51,288
|
|
49,472
|
|
|
Diluted
|
|
51,288
|
|
49,472
|
|
|
Hawaiian
Holdings, Inc.
Consolidated
Balance Sheet (unaudited)
|
|
|
|
March 31,
2022
(unaudited)
|
|
December 31,
2021
|
|
|
(in thousands,
except shares)
|
ASSETS
|
|
|
|
|
Current
Assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
481,212
|
|
$
490,561
|
Restricted
cash
|
|
17,253
|
|
17,267
|
Short-term
investments
|
|
1,162,895
|
|
1,241,752
|
Accounts receivable,
net
|
|
91,135
|
|
92,888
|
Income taxes
receivable
|
|
72,792
|
|
71,201
|
Spare parts and
supplies, net
|
|
35,923
|
|
34,109
|
Prepaid expenses and
other
|
|
60,305
|
|
66,127
|
Total
|
|
1,921,515
|
|
2,013,905
|
Property and
equipment, less accumulated depreciation and amortization of
$1,033,614 and $999,966 as of March 31, 2022 and
December 31, 2021, respectively
|
|
1,931,596
|
|
1,957,623
|
Other
Assets:
|
|
|
|
|
Assets held for
sale
|
|
28,443
|
|
29,449
|
Operating lease
right-of-use assets
|
|
516,355
|
|
536,154
|
Long-term prepayments
and other
|
|
76,753
|
|
80,489
|
Intangible assets,
net
|
|
13,500
|
|
13,500
|
Total
Assets
|
|
$
4,488,162
|
|
$
4,631,120
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
Accounts
payable
|
|
$
129,832
|
|
$
114,400
|
Air traffic liability
and current frequent flyer deferred revenue
|
|
760,783
|
|
631,157
|
Other accrued
liabilities
|
|
157,687
|
|
165,050
|
Current maturities of
long-term debt, less discount
|
|
60,431
|
|
97,096
|
Current maturities of
finance lease obligations
|
|
23,607
|
|
24,149
|
Current maturities of
operating leases
|
|
77,200
|
|
79,158
|
Total
|
|
1,209,540
|
|
1,111,010
|
Long-Term
Debt
|
|
1,671,092
|
|
1,704,298
|
Other Liabilities
and Deferred Credits:
|
|
|
|
|
Noncurrent finance
lease obligations
|
|
95,173
|
|
100,995
|
Noncurrent operating
leases
|
|
404,378
|
|
423,293
|
Accumulated pension
and other post-retirement benefit obligations
|
|
155,457
|
|
160,817
|
Other liabilities and
deferred credits
|
|
77,450
|
|
78,340
|
Noncurrent frequent
flyer deferred revenue
|
|
305,575
|
|
296,484
|
Deferred tax
liability, net
|
|
147,404
|
|
186,797
|
Total
|
|
1,185,437
|
|
1,246,726
|
Commitments and
Contingencies
|
|
|
|
|
Shareholders'
Equity:
|
|
|
|
|
Special preferred
stock, $0.01 par value per share, three shares issued and
outstanding as of March 31, 2022 and December 31,
2021
|
|
—
|
|
—
|
Common stock, $0.01
par value per share, 51,327,070 and 51,233,369 shares
outstanding as of March 31, 2022 and December 31, 2021,
respectively
|
|
513
|
|
512
|
Capital in excess of
par value
|
|
270,028
|
|
269,575
|
Accumulated
income
|
|
258,028
|
|
380,837
|
Accumulated other
comprehensive loss, net
|
|
(106,476)
|
|
(81,838)
|
Total
|
|
422,093
|
|
569,086
|
Total Liabilities
and Shareholders' Equity
|
|
$
4,488,162
|
|
$
4,631,120
|
Hawaiian
Holdings, Inc.
Condensed
Consolidated Statements of Cash Flows (unaudited)
|
|
|
|
Three months ended
March 31,
|
|
|
2022
|
|
2021
|
|
|
(in
thousands)
|
Net cash provided
by Operating Activities
|
|
$
22,154
|
|
$
122,009
|
Cash flows from
Investing Activities:
|
|
|
|
|
Additions to property
and equipment, including pre-delivery payments
|
|
(9,066)
|
|
(10,417)
|
Proceeds from the
disposition of aircraft related equipment
|
|
1,124
|
|
117
|
Purchases of
investments
|
|
(263,161)
|
|
(655,266)
|
Sales of
investments
|
|
307,780
|
|
117,857
|
Net cash provided by
(used in) investing activities
|
|
36,677
|
|
(547,709)
|
Cash flows from
Financing Activities:
|
|
|
|
|
Proceeds from the
issuance of common stock
|
|
—
|
|
68,132
|
Long-term
borrowings
|
|
—
|
|
1,220,259
|
Repayments of
long-term debt and finance lease obligations
|
|
(66,704)
|
|
(328,256)
|
Debt issuance costs
and discounts
|
|
—
|
|
(24,664)
|
Payment for taxes
withheld for stock compensation
|
|
(1,490)
|
|
(1,565)
|
Other
|
|
—
|
|
1,837
|
Net cash provided by
(used in) financing activities
|
|
(68,194)
|
|
935,743
|
Net increase
(decrease) in cash and cash equivalents
|
|
(9,363)
|
|
510,043
|
Cash, cash
equivalents, and restricted cash - Beginning of
Period
|
|
507,828
|
|
509,639
|
Cash, cash
equivalents, and restricted cash - End of Period
|
|
$
498,465
|
|
$
1,019,682
|
|
Table
2.
Hawaiian
Holdings, Inc.
Selected
Statistical Data (unaudited)
|
|
|
Three months ended
March 31,
|
|
|
2022
|
|
2021
|
|
%
Change
|
|
|
(in thousands, except as otherwise indicated)
|
Scheduled
Operations (a) :
|
|
|
|
|
|
|
Revenue passengers
flown
|
|
2,030
|
|
733
|
|
176.9%
|
Revenue passenger
miles (RPM)
|
|
2,974,352
|
|
1,054,128
|
|
182.2%
|
Available seat miles
(ASM)
|
|
4,242,483
|
|
2,466,043
|
|
72.0%
|
Passenger revenue per
RPM (Yield)
|
|
13.58 ¢
|
|
13.04 ¢
|
|
4.1%
|
Passenger load factor
(RPM/ASM)
|
|
70.1%
|
|
42.7%
|
|
27.4 pts.
|
Passenger revenue per
ASM (PRASM)
|
|
9.52 ¢
|
|
5.57 ¢
|
|
70.9%
|
Total Operations
(a) :
|
|
|
|
|
|
|
Revenue passengers
flown
|
|
2,036
|
|
737
|
|
176.3%
|
Revenue passenger
miles (RPM)
|
|
2,987,565
|
|
1,062,317
|
|
181.2%
|
Available seat miles
(ASM)
|
|
4,263,048
|
|
2,481,647
|
|
71.8%
|
Operating revenue per
ASM (RASM)
|
|
11.19 ¢
|
|
7.34 ¢
|
|
52.5%
|
Operating cost per ASM
(CASM)
|
|
14.66 ¢
|
|
10.29 ¢
|
|
42.5%
|
CASM excluding
aircraft fuel and non-recurring items (b)
|
|
11.07 ¢
|
|
14.30 ¢
|
|
(22.6)%
|
Aircraft fuel expense
per ASM (c)
|
|
3.54 ¢
|
|
1.92 ¢
|
|
84.4%
|
Revenue block hours
operated
|
|
44,883
|
|
26,995
|
|
66.3%
|
Gallons of jet fuel
consumed
|
|
53,417
|
|
29,945
|
|
78.4%
|
Average cost per
gallon of jet fuel (actual) (c)
|
|
$
2.83
|
|
$
1.59
|
|
78.0%
|
(a)
|
Includes the
operations of the Company's contract carrier under a capacity
purchase agreement, which was indefinitely suspended in the first
quarter of 2021 and terminated in the second quarter of
2021.
|
(b)
|
See Table 3 for a
reconciliation of GAAP operating expenses to operating expenses
excluding aircraft fuel and non-recurring items.
|
(c)
|
Includes applicable
taxes and fees.
|
Table 3.
Hawaiian
Holdings, Inc.
Non-GAAP Financial Reconciliation
(unaudited)
The Company evaluates its financial performance utilizing
various GAAP and non-GAAP financial measures, including adjusted
net income (loss), adjusted operating expenses, adjusted diluted
net income (loss) per share (EPS), CASM, PRASM, RASM, Passenger
Revenue per RPM, and Adjusted EBITDA. Pursuant to Regulation
G, the Company has included the following reconciliation of
reported non-GAAP financial measures to comparable financial
measures reported on a GAAP basis. The adjustments are
described below:
- During the three months ended March 31,
2021 the Company recognized $147.3
million in contra-expense related to grant proceeds under
the federal Payroll Support Programs (Government grant
recognition). The grant proceeds were recognized in proportion to
estimated wages and benefits expense over the period to which the
Payroll Support Programs relate.
- Loss on extinguishment of debt is excluded to allow investors
to better analyze the Company's core operational performance and
more readily compare its results to other airlines in the periods
presented below.
- Changes in fair value of fuel derivative contracts, net of tax,
are based on market prices for open contracts as of the end of the
reporting period, and include the unrealized amounts of fuel
derivatives (not designated as hedges) that will settle in future
periods and the reversal of prior period unrealized amounts.
- During the three months ended March 31,
2022, the Company reached a tentative agreement with the
representatives of its International Association of Machinists and
Aerospace Workers (IAM-M) and International Association of
Machinists and Aerospace Workers - Clerical Division (IAM-C)
employees. In February 2022, the
Company received notice from IAM that the agreement was ratified by
its members. The new CBA included a signing bonus of $2.1 million, which was recorded in wages and
benefits.
- Unrealized loss (gain) on foreign debt is based on fluctuation
in exchange rates and the measurement of foreign-denominated debt
to the Company's functional currency.
- Changes in fair value of foreign currency derivative contracts,
net of tax, are based on market prices for open contracts as of the
end of the reporting period, including the unrealized amounts of
foreign currency derivatives (not designated as hedges) that will
settle in future periods and the reversal of prior period
unrealized amounts.
The Company believes that adjusting for the impact of the
recognition of grant proceeds, changes in fair value of fuel and
foreign currency derivative contracts, fluctuations in exchange
rates on debt instruments denominated in foreign currency, CBA
ratification bonus, and the loss recognized on the extinguishment
of debt helps investors better analyze the Company's operational
performance and compare its results to other airlines in the
periods presented.
|
|
Three months ended
March 31,
|
|
|
2022
|
|
2021
|
|
|
Total
|
|
Diluted Net
Loss Per
Share
|
|
Total
|
|
Diluted Net
Loss Per
Share
|
|
|
(in thousands,
except per share data)
|
Net Loss, as
reported
|
|
$
(122,809)
|
|
$
(2.39)
|
|
$
(60,691)
|
|
$
(1.23)
|
Adjusted
for:
|
|
|
|
|
|
|
|
|
Government grant
recognition
|
|
—
|
|
—
|
|
(147,270)
|
|
(2.98)
|
Loss on debt
extinguishment
|
|
—
|
|
—
|
|
3,994
|
|
0.08
|
Changes in fair value
of fuel derivative contracts
|
|
—
|
|
—
|
|
(382)
|
|
(0.01)
|
CBA ratification
bonus
|
|
2,104
|
|
0.04
|
|
—
|
|
—
|
Unrealized gains on
foreign debt
|
|
(11,582)
|
|
(0.23)
|
|
(19,043)
|
|
(0.38)
|
Unrealized gains on
non-designated foreign exchange positions
|
|
—
|
|
—
|
|
(1,749)
|
|
(0.03)
|
Tax effect of
adjustments
|
|
1,990
|
|
0.04
|
|
34,534
|
|
0.70
|
Adjusted net
loss
|
|
$
(130,297)
|
|
$
(2.54)
|
|
$
(190,607)
|
|
$
(3.85)
|
Adjusted EBITDA
The Company believes that adjusting earnings for interest,
taxes, depreciation and amortization, non-recurring operating
expenses (such as changes in unrealized gains and losses on
financial instruments) and one-time charges helps investors better
analyze the Company's financial performance by allowing for
company-to-company and period-over-period comparisons that are
unaffected by company-specific or one-time occurrences.
|
|
Three months ended
March 31,
|
|
|
2022
|
|
2021
|
|
|
(in
thousands)
|
Net Loss
|
|
$
(122,809)
|
|
(60,691)
|
Income tax
benefit
|
|
(32,015)
|
|
(16,133)
|
Depreciation and
amortization
|
|
33,755
|
|
35,356
|
Interest expense and
amortization of debt discounts and issuance costs
|
|
25,037
|
|
23,693
|
EBITDA, as
reported
|
|
(96,032)
|
|
(17,775)
|
Adjusted
for:
|
|
|
|
|
Government grant
recognition
|
|
—
|
|
(147,270)
|
Loss on extinguishment
of debt
|
|
—
|
|
3,994
|
Changes in fair value
of fuel derivative instruments
|
|
—
|
|
(382)
|
CBA ratification
bonus
|
|
2,104
|
|
—
|
Unrealized gain on
non-designated foreign exchange positions
|
|
—
|
|
(1,749)
|
Unrealized gains on
foreign debt
|
|
(11,582)
|
|
(19,043)
|
Adjusted
EBITDA
|
|
$
(105,510)
|
|
$
(182,225)
|
Operating Costs per Available Seat Mile (CASM)
The
Company has separately listed in the table below its fuel costs per
ASM and non-GAAP unit costs, excluding fuel and non-recurring
items. These amounts are included in CASM, but for internal
purposes the Company consistently uses cost metrics that exclude
fuel and non-recurring items (if applicable) to measure and monitor
its costs.
|
|
Three months ended
March 31,
|
|
|
2022
|
|
2021
|
|
|
(in thousands,
except CASM data)
|
GAAP Operating
Expenses
|
|
$
625,019
|
|
$
255,381
|
Adjusted
for:
|
|
|
|
|
Government grant
recognition
|
|
—
|
|
147,270
|
CBA ratification
bonus
|
|
(2,104)
|
|
—
|
Operating Expenses
excluding non-recurring items
|
|
$
622,915
|
|
$
402,651
|
Aircraft fuel,
including taxes and delivery
|
|
(150,982)
|
|
(47,736)
|
Operating Expenses
excluding fuel and non-recurring items
|
|
$
471,933
|
|
$
354,915
|
Available Seat
Miles
|
|
4,263,048
|
|
2,481,647
|
CASM -
GAAP
|
|
14.66 ¢
|
|
10.29 ¢
|
Aircraft fuel,
including taxes and delivery
|
|
(3.54)
|
|
(1.92)
|
Government grant
recognition
|
|
—
|
|
5.93
|
CBA ratification
bonus
|
|
(0.05)
|
|
—
|
CASM excluding fuel
and non-recurring items
|
|
11.07 ¢
|
|
14.30 ¢
|
|
|
Estimated three
months ending June 30,
2022
|
|
|
(in thousands,
except CASM data)
|
GAAP operating
expenses
|
|
$
680,920
|
-
|
$
717,905
|
Aircraft fuel,
including taxes and delivery
|
|
(199,259)
|
-
|
(206,504)
|
Adjusted operating
expenses
|
|
$
481,661
|
-
|
$
511,400
|
Available seat
miles
|
|
4,409,814
|
-
|
4,564,544
|
CASM - GAAP
|
|
15.45 ¢
|
-
|
15.74 ¢
|
Aircraft fuel,
including taxes and delivery
|
|
(4.52)
|
-
|
(4.53)
|
Adjusted
CASM
|
|
10.93 ¢
|
-
|
11.21 ¢
|
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SOURCE Hawaiian Holdings, Inc.