Saturday, 28 July 2018

Second-quarter results for Allegiant

Allegiant Travel Company has reported the following financial results for the second quarter 2018, as well as comparisons to the prior year:

"We are proud to announce our 62nd consecutive profitable quarter," stated Maurice J. Gallagher, Jr., chairman and CEO of Allegiant Travel Company. "This is the second consecutive quarter of EPS growth, despite seeing our fuel cost per gallon increase by over 39 percent in the second quarter. This is a wonderful testament to the hard work of our team members as we navigate another busy summer.

"We are continuing our transition to an all-Airbus fleet. We have done an excellent job year-to-date but this summer was the critical period in this transition, including the timely delivery and induction of fifteen Airbus aircraft, and retirement of six MD-80s.  Today we are on our schedule as planned, though some delayed deliveries in late May impacted our peak June period, in terms of top line and operations reliability.  Looking forward, we should complete our transition at the end of November as scheduled.

"Our CASM-ex fuel results came in nicely. Our improved operational results as well as efficiencies from the Airbus fleet are beginning to pay dividends, and we are pleased with where the cost trend line is headed. Additionally, fuel efficiency continues to improve with the transition, with 76 vs. 72 ASMs per gallon this year compared to the same period last year.

“The Sunseeker resort project continues to move ahead. We are closing in on a financing plan and hope to announce the specifics in the next 60 to 90 days. We continue to be impressed with the many synergies and business alignments between Sunseeker and our air service presence on the west coast of Florida. Our Punta Gorda destination - a 15 minute drive from our Sunseeker location, grew over 30 percent in capacity on a trailing twelve month basis. We are on a pace to carry over 1.5 million passengers in and out of Punta Gorda this year."

Shareholder returns

2018 shareholder returns - over $22 million in the first half of the year through dividends
Will pay dividends of $0.70 per share on August 31, 2018 to shareholders of record as of August 17, 2018
Current share repurchase authority of $100 million as of July 25, 2018
2018 outlook

Third quarter scheduled and system ASMs are expected to grow between thirteen and fifteen percent vs last year
2018 full year ASM growth is expected to be between nine and eleven percent due to slower than expected aircraft deliveries
2018 fuel cost is expected to be $2.35 per gallon using the forward curve as of July 24, 2018
2018 EPS is expected to be between $9 and $10 per share due to the expected higher fuel cost
Fuel expense is expected to increase approximately $35 million from when guided in November 2017