The US budget carrier Allegiant reported preliminary passenger traffic results for September 2020 this week, as well as third-quarter 2020.
"Average daily cash burn came in at roughly $1.3 million for the third quarter," stated Gregory Anderson, executive vice president and chief financial officer, Allegiant Travel Company. "Gross bookings for the quarter averaged more than $2.0 million per day, which is better than our previous booking levels of less than $2 million per day, due primarily to steady improvements in bookings throughout the month of September. During the third quarter, we paid approximately $15 million to Sixth Street Partners in conjunction with the termination of the Sunseeker loan agreement, which drove cash burn up slightly. As previously stated, our cash burn figure includes debt payments. We continue to expect fourth quarter daily cash burn to be well below $1 million based on the assumption of average daily gross bookings of more than $2.0 million, which is inclusive of the remaining $5 million payment to Sixth Street Partners.
"As we enter the final quarter of the year, we meaningfully increased our liquidity position to over $850 million, primarily driven by the $84 million in senior secured debt backed by two A320 aircraft and eight CFM engines along with the sale of $150 million of senior secured notes, which is backed by collateral pledged to our existing Term Loan. We believe this improved liquidity coupled with our industry-best cash burn rate not only bolsters liquidity further, but provides enhanced flexibility to best respond to the fluid environment."
"We will continue to approach the fourth quarter by maintaining a wide selling footprint," stated Drew Wells, vice president of revenue. "This approach has been effective at capturing demand as it returns. We completed the quarter with capacity down 6.5 percent year over year and a load factor of just below 50 percent. We saw some strength towards the back half of the quarter, as evidenced by September's load factor of 57.4 percent. We continue to monitor bookings and will make any necessary cuts to the schedule as dictated by demand trends."
Scheduled Service |
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| September 2020 | September 2019 | Change |
Passengers | 475,814 | 770,768 | (38.3%) |
Revenue passenger miles (000) | 405,590 | 639,534 | (36.6%) |
Available seat miles (000) | 706,148 | 775,906 | (9.0%) |
Load factor | 57.4% | 82.4% | (25.0 pts) |
Departures | 4,885 | 5,638 | (13.4%) |
Average stage length (miles) | 839 | 808 | 3.8% |
| 3rd Quarter 2020 | 3rd Quarter 2019 | Change |
Passengers | 2,003,648 | 3,753,611 | (46,6%) |
Revenue passenger miles (000) | 1,714,622 | 3,170,826 | (45.9%) |
Available seat miles (000) | 3,449,339 | 3,687,473 | (6.5%) |
Load factor | 49.7% | 86.0% | (36.3 pts) |
Departures | 23,710 | 26,238 | (9.6%) |
Average stage length (miles) | 839 | 824 | 1.8% |
Total System* |
|
| September 2020 | September 2019 | Change |
Passengers | 483,278 | 799,592 | (39.6%) |
Available seat miles (000) | 734,898 | 855,962 | (14.1%) |
Departures | 5,137 | 6,248 | (17.8%) |
Average stage length (miles) | 830 | 802 | 3.5% |
|
| 3rd Quarter 2020 | 3rd Quarter 2019 | Change |
Passengers | 2,016,241 | 3,806,369 | (47.0%) |
Available seat miles (000) | 3,521,508 | 3,888,400 | (9.4%) |
Departures | 24,365 | 27,707 | (12.1%) |
Average stage length (miles) | 834 | 823 | 1.3% |
*Total system includes scheduled service and fixed fee contract. System revenue passenger miles and system load factor are not useful statistics as system available seat miles include both ASMs flown by fixed fee flying as well as non-revenue producing repositioning flights used for operational needs. Fixed fee flying is better measured through dollar contribution versus operational statistics.
Preliminary Financial Results |
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| $ per gallon |
September 2020 estimated average fuel cost per gallon – system | $1.28 |
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| $ per gallon |
3rd quarter 2020 estimated average fuel cost per gallon – system | $1.32 |
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