-- Operating income totaled
-- Operating revenue increased 14.9% to
-- Unrestricted cash, cash equivalents and short-term investments of
"Our first quarter financial performance was good in absolute terms and notably better than that of most of our competitors," commented
"Looking ahead, short term bookings remain robust albeit at fares lower than last year and lower than in the first quarter. The trend towards bookings being made closer to the date of travel continues and coupled with significant uncertainty in the economic environment provides us a less clear view of the future than we are accustomed to. However, our strong first quarter results provide a good foundation upon which to build as we approach the summer travel season," concluded Mr. Dunkerley.
First Quarter Financial Results
The Company reported operating income of
Hawaiian's short haul interisland operations increased significantly year-over-year during the first quarter, while long haul capacity was relatively flat year-over-year. Since shorter haul operations tend to have both higher revenue and higher costs per seat mile, this shift in mix of flying toward a higher percentage of shorter segment interisland operations tends to inflate both revenue per available seat mile (RASM) and cost per available seat mile (CASM) relative to the prior year.
First quarter 2009 operating revenue was
Total operating expenses for the first quarter of 2009 decreased 7.5% year-over-year to
Aircraft fuel costs decreased 44.9% year-over-year in the first quarter to
We believe that economic fuel expense is the best measure of the effect of fuel prices on our business as it most closely approximates the net cash outflow associated with the purchase of fuel for our operations in a period. We define economic fuel expense as GAAP fuel expense plus (gains)/losses realized through actual cash (receipts)/payments received from or paid to hedge counterparties for fuel hedge derivative contracts settled during the period. For the three months ended
Wages and benefits expenses increased by
First quarter 2009 non-operating expenses totaled
Liquidity, Capital Resources and Fuel Hedging -- As ofInvestor Conference CallMarch 31, 2009 the Company had: -- Unrestricted cash and cash equivalents and short-term investments of$248.0 million , and$34.7 million in restricted cash. --$87.9 million outstanding under two term loan facilities,$106.7 million outstanding under floating rate notes issued in conjunction with the acquisition of threeBoeing 767-300 ER aircraft inDecember 2006 , and additional notes payable of$11.8 million . --$46.6 million of Capital Lease obligations primarily associated with four 717-200 aircraft. -- A summary of the Company's fuel derivatives contracts as ofApril 24, 2009 is included as Table 4. Company Highlights -- In April, Hawaiian earned the distinction of being the nation's top-ranked carrier for service quality and performance in 2008, as reported by the 19th annual Airline Quality Rating study. -- Hawaiian was ranked as the nation's #1 carrier for on-time performance and fewest flight cancellations as reported by theU.S. Department of Transportation's (DOT) Air Travel Consumer Report for the months of January and February. Hawaiian also ranked first and second nationally for fewest misplaced bags in January and February respectively. -- In late March,Hawaiian Airlines' flight attendants voted overwhelmingly to approve a new two-year contract agreed tentatively between the company and leaders of theAssociation of Flight Attendants-CWA (AFA-CWA) in February. The new contract increases compensation for Hawaiian's 1,031 flight attendants and provides for operational improvements that will increase efficiency for the company. -- In March, Hawaiian announced that its Board of Directors authorized a stock repurchase program under which the Company may purchase up to$7 million of its outstanding common stock. -- In April, Hawaiian announced the addition of a third weekly roundtrip flight for the summer betweenHonolulu and Pago Pago,American Samoa to address increased seasonal demand.
About
Hawaiian is the nation's highest-ranked carrier for service quality and performance in 2008 in the 19th annual Airline Quality Rating study. Hawaiian has also led all U.S. carriers in on-time performance for each of the past five years (2004-2008) and has been an industry leader in fewest misplaced bags during that same period (#1 from 2005-2007, #2 in 2008) as reported by the
Now in its 80th year of continuous service in
Forward Looking Statements
The foregoing information contains certain forward-looking statements that reflect the Company's current views with respect to certain current and future events and financial performance. These forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the Company's operations and business environment 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 price and availability of aviation fuel; a continued decline in the U.S. and global economies; our dependence on tourist travel; competition in the transpacific and interisland markets; the effects of seasonality and cyclicality; the concentration of our business in
Any forward-looking statements in this release are based upon information available to the Company on the date of this release. The Company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any statements expressed or implied therein will not be realized. Additional information on risk factors that could potentially affect the Company's financial results may be found in the Company's filings with the
Table 1.SOURCEHawaiian Holdings, Inc. Consolidated Statements of Operations (in thousands, except for per share data) (unaudited) Three Months Ended March 31, --------- 2009 2008 ---- ---- (unaudited) Operating Revenue: Passenger $254,141 $230,327 Cargo 14,909 7,762 Other 19,574 13,130 ------ ------ Total 288,624 251,219 ------- ------- Operating Expenses: Aircraft fuel, including taxes and oil 50,199 91,036 Wages and benefits 67,465 57,301 Aircraft rent 24,151 23,813 Maintenance materials and repairs 28,779 29,375 Aircraft and passenger servicing 14,620 13,672 Commissions and other selling 17,450 16,168 Depreciation and amortization 12,723 12,019 Other rentals and landing fees 12,494 8,169 Other 24,797 21,674 ------ ------ Total 252,678 273,227 ------- ------- Operating Income (Loss) 35,946 (22,008) ------ ------- Nonoperating Income (Expense): Interest and amortization of debt discounts and issuance costs (5,250) (5,633) Interest income 720 1,993 Fuel hedge gain (loss) (1,387) 5,575 Other, net (388) 158 ---- --- Total (6,305) 2,093 ------ ----- Income (Loss) Before Income Taxes 29,641 (19,915) Income tax expense 6,107 - ----- - Net Income (Loss) $23,534 $(19,915) ======= ======== Net Income (Loss) Per Common Stock Share: Basic $0.46 $(0.42) ===== ====== Diluted $0.46 $(0.42) ===== ====== Weighted Average Number of Common Stock Shares Outstanding: Basic 51,618 47,302 ====== ====== Diluted 51,671 47,302 ====== ====== Table 2.Hawaiian Holdings, Inc. Selected Statistical Data Three Months Ended March 31, ------------------------------- 2009 2008 Change ---- ---- ------ Scheduled Operations: Revenue passenger miles (RPM) (a) 1,959.6 1,930.1 1.5% Available seat miles (ASM) (a) 2,391.9 2,270.9 5.3% Passenger revenue per RPM 12.97 cents 11.93 cents 8.7% Passenger load factor (RPM/ASM) 81.9% 85.0% (3.10) pt. Passenger revenue per ASM (PRASM) 10.63 cents 10.14 cents 4.8% Total Operations: Revenue passenger miles (RPM) (a) 1,960.1 1,938.9 1.1% Available seat miles (ASM) (a) 2,392.6 2,281.4 4.9% Passenger load factor (RPM/ASM) 81.9% 85.0% (3.10) pt. Operating Revenue per ASM (RASM) 12.06 cents 11.01 cents 9.5% Operating Cost per ASM (CASM) 10.56 cents 11.98 cents (11.9%) CASM ex-fuel 8.46 cents 7.99 cents 5.9% (a) In millions. Table 3.Hawaiian Holdings, Inc. Economic Fuel Expense Three months ended March 31, (in millions except per gallon amounts) 2009 2008 Change ---- ---- ------ GAAP fuel expense, including taxes and delivery $50.2 $91.0 $(40.8) Settlement of fuel derivative contracts in the current period 10.9 (4.5) 15.4 ---- ---- ---- Economic fuel expense $61.2 $86.5 $(25.4) Fuel gallons consumed 33.8 31.9 1.9 ---- ---- --- Economic fuel cost per gallon $1.81 $2.71 $(0.90) ===== ===== ====== Table 4.Hawaiian Holdings, Inc. Fuel Derivative Contract Summary As ofApril 24, 2009 Weighted Average Percentage Ceiling of Price Gallons Quarter's (per Ceiling Hedged Consumption gallon) Price Range (Thousands) Hedged -------- ------------- ------------ ------------ Second Quarter 2009 -------------- Crude Oil $1.66 $1.00 - $2.66 17,136 54% Third Quarter 2009 ------------- Crude Oil $1.52 $1.10 - $2.39 12,726 40% Fourth Quarter 2009 -------------- Crude Oil $1.51 $1.20 - $1.86 7,812 25% First Quarter 2010 ------------- Crude Oil $1.76 $1.60 - $1.90 2,730 9% Percentage Weighted of Average Floor Price Gallons Quarter's Floor Range (Per Hedged Consumption Price Gallon) (Thousands) Hedged -------- ----------- ------------ ------------ Second Quarter 2009 -------------- Crude Oil $1.54 $0.98 - $2.04 7,560 24% Third Quarter 2009 ------------- Crude Oil $1.15 $0.88 - $1.90 7,770 25% Fourth Quarter 2009 -------------- Crude Oil $1.02 $0.92 - $1.21 6,636 21% First Quarter 2010 ------------- Crude Oil $1.11 $0.96 - $1.26 2,730 9% Table 5.Hawaiian Holdings, Inc. Reconciliation of Non-GAAP Financial Measures (in millions, except for CASM data) (unaudited) Three Months Ended March 31, 2009 2008 ---- ---- GAAP operating expenses $252.7 $273.2 Aircraft fuel, including taxes and oil 50.2 91.0 ---- ---- Adjusted operating expenses $202.5 $182.2 ====== ====== Available Seat Miles 2,392.6 2,281.4 CASM 10.56 cents 11.98 cents Less aircraft fuel 2.10 3.99 ---- ---- CASM - ex-fuel 8.46 cents 7.99 cents ==== ==== Notes: ------ ASM's represents total operations
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