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| Photo Alaska Air |
The Alaska Air Group has this week released its first-quarter 2021results, slowing a GAAP net loss of $131 million, compared to a net loss of $232 million, in the first quarter of 2020. Excluding the impact of payroll support program wage offsets, special items and mark-to-market fuel hedge adjustments, the company reported an adjusted net loss of $436 million, compared to an adjusted net loss of $102 million in 2020.
"This has been a long road, and I want to thank the employees at Alaska and Horizon for providing great guest service and everything they've done to get through the last challenging year and help us achieve positive cash flow in March," said CEO Ben Minicucci. "We're a big company, but still small enough that each person's work makes a difference. We're now laser focused on a return to profitability and growth, with aggressive cost control, optimal productivity across all our work groups, and the operational and financial discipline that Alaska is known for."
Financial Results:
Reported a net loss for the first quarter of 2021 under Generally Accepted Accounting Principles (GAAP) of $131 million, or $1.05 per share, compared to a net loss of $232 million, or $1.89 per share in the first quarter of 2020.Reported a net loss for the first quarter of 2021, excluding CARES Act Payroll Support Program (PSP) wage offsets, special items and mark-to-market fuel hedge accounting adjustments, of $436 million, or $3.51 per share, compared to an adjusted net loss of $102 million or $0.83 per share, in the first quarter of 2020.Decreased adjusted net debt to $1.6 billion at March 31, 2021 from $1.7 billion at December 31, 2020.Reported a debt-to-capitalization ratio, including short-term borrowings related to COVID-19, of 62%.Held $3.5 billion in unrestricted cash and marketable securities as of March 31, 2021, and available total liquidity of $5.3 billion.Generated $167 million in operating cash flow in the first quarter, inclusive of PSP funding, bolstered by improved advance bookings for increased demand for air travel.
Operational Updates:
Welcomed Ben Minicucci as Air Group CEO and Constance von Muehlen as Alaska COO.
Formally joined the oneworld alliance on March 31 as the 14th member airline. Entry into the alliance transforms Alaska into a global airline, provides guests a seamless travel experience and increases the value of our loyalty and corporate travel offerings.
Finalized a previously announced amendment to the existing aircraft purchase agreement with Boeing to expand our total 737-9 MAX firm deliveries to 68 between 2021 and 2024, inclusive of 13 leased aircraft.
Took delivery of four 737-9 MAX aircraft during the first quarter.
Announced 12 new routes during the first quarter, aimed at offering our guests greater connectivity to and from West Coast destinations.
Announced plans to open a new Alaska Lounge in Terminal 2 of San Francisco International Airport.
Issued early recall notices to nearly 350 Alaska pilots on extended leaves to prepare for capacity growth.
Liquidity Updates:
Received $546 million through a combination of grants and loans from the U.S. Treasury under an extension of the PSP, and anticipate a supplemental payment of $80 million in late April.Received notification from the U.S. Treasury that Alaska, Horizon and McGee are eligible to obtain an additional $584 million in incremental payroll support funding under a third round of the PSP.Extended maturity of the 364-day Senior Secured Term Loan previously due to expire in March 2021 to March 2022, and in conjunction funded an incremental $54 million.Sustainability Updates:Published 2020 LIFT Sustainability Report including final data on our 2020 sustainability goals and Sustainable Accounting Standards Board disclosure, and shared new 2025 goals related to Environmental Social Governance.Announced specific commitments for diversity, equity, and inclusion to increase diverse leadership representation, cultivate an inclusive culture, and to continue supporting education.Set a course for net-zero carbon emissions by 2040, with 2025 milestone goals to be the most fuel-efficient U.S. airline, maintain carbon neutral growth, and cut ground service equipment climate emissions by 50%. As part of the net-zero commitment, joined The Climate Pledge alongside Amazon and other major businesses.Announced a memorandum of understanding with SkyNRG focused on increasing the supply and production of sustainable aviation fuel from municipal solid waste and other waste streams, especially in the western United States.
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