Hawaiian Airlines Reports September and Third Quarter 2019 Traffic Statistics

Hawaiian Airlines, Inc., a subsidiary of Hawaiian Holdings, Inc. (NASDAQ: HA), yesterday announced its system-wide traffic statistics for the month and quarter ended September 30, 2019. The Company also updated its expectations for certain third quarter 2019 financial metrics.

Hawaiian welcomed more than 931,000 guests in September 2019. Total traffic (revenue passenger miles) increased 3.0 percent on an increase of 0.7 percent in capacity (available seat miles) compared to September 2018. Load factor increased 1.9 points to 85.5 percent.

For the third quarter ended September 30, 2019, Hawaiian welcomed more than 3 million guests. Total traffic increased 2.7 percent on a decrease of 0.4 percent in capacity. Load factor increased 2.7 points to 87.8 percent.

The table below summarizes September, third quarter, and year-to-date statistics compared to the respective prior-year periods.

SYSTEM-WIDE OPERATIONS1

SEPTEMBER

2019

2018

% CHANGE

PAX

931,280

918,715

1.4%

RPMs (000)

1,490,482

1,446,766

3.0%

ASMs (000)

1,742,249

1,729,723

0.7%

LF

85.5%

83.6%

1.9 pts

THIRD QUARTER

2019

2018

% CHANGE

PAX

3,071,854

3,039,107

1.1%

RPMs (000)

4,679,632

4,557,706

2.7%

ASMs (000)

5,331,914

5,352,976

(0.4)%

LF

87.8%

85.1%

2.7 pts

YEAR-TO-DATE

2019

2018

% CHANGE

PAX

8,853,052

8,948,975

(1.1)%

RPMs (000)

13,300,090

12,921,666

2.9%

ASMs (000)

15,341,510

15,104,500

1.6%

LF

86.7%

85.5%

1.2 pts

PAX

Passengers transported

RPM

Revenue Passenger Mile; one paying passenger transported one mile

ASM

Available Seat Mile; one seat transported one mile

LF

Load Factor; percentage of seating capacity filled

1Includes the operations of contract carriers under capacity purchase agreements.

Third Quarter 2019 Outlook

The Company has revised certain of its expectations for the quarter ended September 30, 2019 that were previously provided in its Second Quarter Earnings Release on July 30, 2019.

Specifically, the Company:

  • raised its estimates for operating revenue per ASM due to better than expected yields in long-haul markets, particularly in its International entity;
  • narrowed its estimates for operating cost per ASM excluding fuel and non-recurring items;
  • narrowed its estimates for gallons of jet fuel consumed; and
  • lowered its estimates for economic fuel cost per gallon.

The table below summarizes the Company’s revised expectations for the quarter ended September 30, 2019 expressed as an expected percentage change compared to the results for the quarter ended September 30, 2018.

Item

Prior Third Quarter 2019 Guidance

Revised Third Quarter 2019 Guidance

GAAP Equivalent

Prior GAAP Third Quarter 2019 Guidance

Revised GAAP Third Quarter 2019 Guidance

Operating revenue per available seat mile (ASM)

Down 1.5 – 4.5%

Down 0.5% – up 0.5%

Cost per ASM (CASM) excluding aircraft fuel and non-recurring items (a)

Up 3.5 – 6.5%

Up 4.5 – 5.5%

Cost per ASM (a)

Down 0.5% – Up 1.7%

Down 0.8% – Up 0.2%

Gallons of jet fuel consumed

Down 2.5 – 4.5%

Down 3.0 – 4.0%

Economic fuel cost per gallon (b)

$2.11

$2.04

Fuel cost per gallon (b)

$2.07

$1.99

(a)

See Table 1 for a reconciliation of GAAP operating expenses to operating expenses excluding aircraft fuel and non-recurring items.

(b)

See Table 2 for a reconciliation of GAAP fuel costs to economic fuel costs.

Non-GAAP Financial Reconciliation

Table 1.

Operating Costs per Available Seat Mile (CASM)

(in thousands, except CASM data) (unaudited)

Estimated three months ended September 30, 2019

GAAP operating expenses

$

635,989

to

$

642,227

Less: aircraft fuel, including taxes and delivery

(137,865)

to

(139,337)

Adjusted operating expenses – excluding aircraft fuel

$

498,124

to

$

502,890

Available Seat Miles

5,331,914

to

5,331,914

CASM – GAAP

11.93

¢

to

12.04

¢

Less: aircraft fuel, including taxes and delivery

(2.59)

to

(2.61)

CASM – excluding aircraft fuel

9.34

¢

to

9.43

¢

Table 2.

Hawaiian Holdings, Inc.

Economic Fuel Expense (unaudited)

The Company believes that economic fuel expense is a good measure of the effect of fuel prices on its business as it most closely approximates the net cash outflow associated with the purchase of fuel for its operations in a period. The Company defines economic fuel expense as GAAP fuel expense plus losses/(gains) realized through actual cash (receipts)/payments received from or paid to hedge counterparties for fuel hedge derivative contracts settled during the period.

Estimated three months ending

September 30, 2019

(in thousands, except per-gallon amounts)

Aircraft fuel expense, including taxes and delivery

$

137,865

to

$

139,337

Realized losses (gains) on settlement of fuel derivative contracts

3,400

to

3,400

Economic fuel expense

$

141,265

to

$

142,737

Fuel gallons consumed

69,247

to

69,969

Economic fuel costs per gallon

$

2.04

to

$

2.04