HONOLULU
(Logo: http://photos.prnewswire.com/prnh/20040827/LAF044LOGO)
Adjusted for economic fuel expense, the Company reported net income of
For the full year 2011, the Company reported consolidated net loss of
The hard work and dedication of all my colleagues gives us confidence in our plans for the year ahead. 2012 will be a year in which our long haul fleet transition to the Airbus A330 continues while we inaugurate new service to a number of new destinations at home and abroad."
Fourth Quarter Financial Results
The Company reported operating income of
Fourth quarter 2011 operating revenue was
Total operating expenses for the fourth quarter of 2011 increased 24.3% year-over-year to
Aircraft fuel costs in the fourth quarter increased 47.8% year-over-year to
The Company believes that economic fuel expense is the best 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 (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
Fourth quarter 2011 nonoperating expense totaled
2011 Full Year Financial Results
For the full year 2011, the Company reported operating income of
Full year 2011 operating revenue was
Total operating expenses for 2011 increased 33.8% year-over-year to
Aircraft fuel costs for 2011 increased 58.9% year-over-year to
For the full year 2011, economic fuel expense was
For the full year of 2011, nonoperating expense totaled
Liquidity, Capital Resources and Fuel Hedging
As of
- Unrestricted cash and cash equivalents of
$304.1 million and$30.9 million in restricted cash. - Available borrowing capacity of
$56.9 million under Hawaiian's Revolving Credit Facility. - Outstanding debt and capital lease obligations of
$462.0 million consisting of the following:$69.2 million outstanding under Convertible Senior Notes issued inMarch 2011 $77.3 million outstanding under floating rate notes issued in conjunction with the acquisition of threeBoeing 767-300 ER aircraft inDecember 2006 $185.7 million secured loan agreements for a portion of the purchase price for 15 previously leasedBoeing 717-200 aircraft inJune 2011 $62.3 million secured loan agreement for the portion of the purchase price of the Airbus A330-200 aircraft delivered inApril 2011 $67.0 million outstanding under secured loan agreement to finance a portion of the purchase price for the Airbus A330-200 aircraft delivered inOctober 2011 $0.5 million of non-aircraft related capital lease obligations
A summary of the Company's fuel derivatives contracts as of
Fourth Quarter Highlights
- Led the U.S. airline industry in October and
November 2011 (last reported month), ranking #1 nationally for on-time performance, as reported by theU.S. Department of Transportation Air Travel Consumer Report . - In October, announced a code-share agreement that allows
Virgin Australia to put its two-letter airline code on Hawaiian's flights betweenSydney andHonolulu in worldwide reservations systems. - In October, added a fifth Airbus A330-200 aircraft to the fleet.
- In November, announced new daily, nonstop flights between
Honolulu andNew York City 's John F. KennedyInternational Airport beginning inJune 2012 . This will be Hawaiian's first destination on theEast Coast . - In November, amended its agreement with
Airbus to purchase an additional five A330-200 aircraft for delivery between 2013 and 2015. Pursuant to this amendment, Hawaiian has firm aircraft orders withAirbus for sixteen A330-200 aircraft for delivery between 2012 and 2015 and six A350XWB-800 aircraft for delivery beginning in 2017. - In December, announced frequency increases providing three daily nonstop flights between
Honolulu andLos Angeles, California beginning inJune 2012 . Also, announced frequency increases providing daily nonstop flights betweenHonolulu andSeoul, South Korea inJuly 2012 . - In December, introduced a Neighbor Island Travel Plan to offer HawaiianMiles members a range of new pricing options.
- In
January 2012 , implemented code-sharing and frequent flyer agreements between Hawaiian andAll Nippon Airways (ANA). - In
January 2012 , announced the introduction of aMaui hub offering improved connections betweenMaui andNeighbor Island destinations, as well as flights to and from theWest Coast . - In
January 2012 , announced a broad set of commercial agreements with jetBlue. The agreements provide for immediate interline connections between the carriers and in the near future encompass code-sharing and a reciprocal frequent flyer partnership. In addition, Hawaiian's new HNL – JFK service will operate from jetBlue's Terminal 5 inNew York beginning in June. - In October, announced the appointment of
Scott Topping as Executive Vice President and Chief Financial Officer of bothHawaiian Airlines andHawaiian Holdings effectiveNovember 1, 2011 . Topping succeedsPeter Ingram in these roles. Mr. Ingram concurrently moved to the newly created position of Executive Vice President and Chief Commercial Officer forHawaiian Airlines with responsibility for all of Hawaiian's revenue generating activities.
Third Quarter Highlights
- Led the U.S. airline industry in July, August and
September 2011 , ranking #1 nationally for on-time performance, as reported by theU.S. Department of Transportation Air Travel Consumer Report . - In July, increased capacity on Hawaiian's daily non-stop route to
Tokyo 'sHaneda Airport with the transition from its 264-seatBoeing 767-300 aircraft to the 294-seat Airbus A330-200 aircraft. Also, announced frequency increases to provide for daily nonstop flights betweenHonolulu andSydney, Australia , beginningDecember 2011 . - In July, launched daily nonstop service between
Honolulu andOsaka, Japan toKansai International Airport ; its third new route toAsia in eight months, underscoring the Company's optimism in the long term opportunities inJapan . - In August, entered into a multi-year sponsorship agreement providing naming rights for the Hawaiian Airlines Field at
Aloha Stadium . - In September, announced that for the 12th consecutive season, Hawaiian would provide chartered air transportation for the
Oakland Raiders , and for the second consecutive year and third of the past four years that Hawaiian would be theSeattle Seahawks ' official charter airline. - In September, announced new daily, nonstop flights between
Honolulu andFukuoka, Japan , beginning inApril 2012 . This will be the fourth new destination inAsia for the Company sinceNovember 2010 . - In September, Hawaiian announced the expansion of its Bay Area service with the introduction of nonstop flights between
Maui andSan Jose, California and the addition of year-round flights betweenMaui andOakland, California beginning inJanuary 2012 . - In August, appointed
Christian Forbes as Vice President of Financial Planning and Analysis and Ann Botticelli as Senior Vice President for Corporate Communications and Public Affairs. In September, appointedMonisa Cline as Vice President of Sales and Alliances.
Second Quarter Highlights
- Led the U.S. airline industry in April, May and
June 2011 , ranking #1 nationally for on-time performance and fewest cancellations, as reported by theU.S. Department of Transportation Air Travel Consumer Report . - In April, added a fourth Airbus A330-200 aircraft to the fleet. In June, purchased its existing fleet of 15
Boeing 717-200 aircraft through a refinancing transaction. - In June, announced expansion of Hawaiian's
Neighbor Island service betweenHonolulu andKahului ,Lihue ,Hilo and Kona during peak travel periods through the addition of threeBoeing 717-200 aircraft to the fleet in fourth quarter 2011 and first quarter 2012. In April, appointedAndrew Watterson as Vice President of Planning and Revenue Management. In May, appointedTom Wessner as Vice President of Strategic Procurement and promotedShannon Okinaka to Vice President – Controller.
First Quarter Highlights
- Led the U.S. airline industry in January, February and
March 2011 , ranking #1 nationally for on-time performance and fewest cancellations, as reported by theU.S. Department of Transportation Air Travel Consumer Report . - In January, launched nonstop service between
Honolulu andSeoul, South Korea four days weekly. - In February, announced new daily, nonstop flights between
Honolulu andOsaka, Japan inJuly 2011 , underscoring the Company's optimism in the long term opportunities inJapan . - In March, announced an expansion of the marketing partnership with
Korean Airlines with a new program that allows each carrier's frequent flyer members to earn and redeem mileage credits on either carrier. - In March, sold
$86.25 million (aggregate principal amount) of 5.00% Convertible Senior Notes due 2016. In connection with the offering of the notes, the Company entered into privately-negotiated convertible note hedge and warrant transactions.
Investor Conference Call
About
Hawaiian has led all U.S. carriers in on-time performance for each of the past seven years (2004-2010) as reported by the
Now in its 83rd year of continuous service in
Forward-Looking Statements
Statements in this release contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect the Company's current views with respect to certain current and future events and financial performance. Such forward-looking statements include, without limitation, statements regarding: our plans for the year; our long haul fleet transition; inauguration of service to new destinations; and statements as to other matters that do not relate strictly to historical facts of statements of assumptions underlying any of the foregoing. Words such as "expects," "anticipates," "projects," "intends," "plans," "believes," "estimates," variations of such words, and similar expressions are also intended to identify such forward-looking statements. 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, all of which may cause the Company's actual results to be materially different from any future results, expressed or implied, in these forward-looking statements.
The risks, uncertainties and assumptions referred to above that could cause the Company's results to differ materially from the results expressed or implied by such forward-looking statements also include the risks, uncertainties and assumptions discussed from time to time in the Company's other public filings and public announcements, including the Company's Annual Report on Form 10-K for the year ended
Table 1. Hawaiian Holdings, Inc. Consolidated Statements of Operations (in thousands, except for per share data) |
||||||||
Three Months Ended |
Twelve Months Ended |
|||||||
December 31, |
December 31, |
|||||||
2011 |
2010 |
2011 |
2010 |
|||||
(unaudited) |
(unaudited) |
(audited) |
||||||
Operating Revenue: |
||||||||
Passenger |
$ 389,213 |
$ 303,825 |
$ 1,480,663 |
$ 1,154,972 |
||||
Other |
44,762 |
39,974 |
169,796 |
155,121 |
||||
Total |
433,975 |
343,799 |
1,650,459 |
1,310,093 |
||||
Operating Expenses: |
||||||||
Aircraft fuel, including taxes and oil |
132,494 |
89,673 |
513,284 |
322,999 |
||||
Wages and benefits |
81,539 |
77,740 |
321,241 |
297,567 |
||||
Aircraft rent |
22,337 |
31,655 |
112,883 |
112,721 |
||||
Maintenance materials and repairs |
47,440 |
28,405 |
169,851 |
123,975 |
||||
Aircraft and passenger servicing |
21,924 |
17,470 |
82,250 |
62,160 |
||||
Commissions and other selling |
23,380 |
18,267 |
96,264 |
78,197 |
||||
Depreciation and amortization |
18,459 |
14,876 |
66,262 |
57,712 |
||||
Other rentals and landing fees |
18,950 |
16,141 |
72,445 |
57,833 |
||||
Other |
32,990 |
27,148 |
125,682 |
105,651 |
||||
Lease termination charges |
- |
- |
70,014 |
- |
||||
Total |
399,513 |
321,375 |
1,630,176 |
1,218,815 |
||||
Operating Income |
34,462 |
22,424 |
20,283 |
91,278 |
||||
Nonoperating Income (Expense): |
||||||||
Interest expense and amortization of debt discounts and issuance costs |
(8,701) |
(4,926) |
(24,521) |
(16,835) |
||||
Interest income |
181 |
497 |
1,514 |
3,634 |
||||
Capitalized interest |
1,964 |
1,357 |
7,771 |
2,665 |
||||
Gains (losses) on fuel derivatives |
4,919 |
4,002 |
(6,862) |
641 |
||||
Gains on investments |
- |
- |
- |
1,168 |
||||
Other, net |
(146) |
195 |
733 |
(562) |
||||
Total |
(1,783) |
1,125 |
(21,365) |
(9,289) |
||||
Income (Loss) Before Income Taxes |
32,679 |
23,549 |
(1,082) |
81,989 |
||||
Income tax (benefit) expense |
11,758 |
(47,030) |
1,567 |
(28,266) |
||||
Net Income (Loss) |
$ 20,921 |
$ 70,579 |
$ (2,649) |
$ 110,255 |
||||
Net Income (Loss) Per Common Stock Share: |
||||||||
Basic |
$ 0.41 |
$ 1.41 |
$ (0.05) |
$ 2.15 |
||||
Diluted |
$ 0.40 |
$ 1.36 |
$ (0.05) |
$ 2.10 |
||||
Weighted Average Number of |
||||||||
Common Stock Shares Outstanding: |
||||||||
Basic |
50,864 |
50,220 |
50,733 |
51,232 |
||||
Diluted |
52,087 |
51,940 |
50,733 |
52,482 |
||||
Table 2. Hawaiian Holdings, Inc. Selected Statistical Data |
|||||||||||||
Three Months Ended |
Twelve Months Ended |
||||||||||||
December 31, |
December 31, |
||||||||||||
2011 |
2010 |
Change |
2011 |
2010 |
Change |
||||||||
Scheduled Operations: |
|||||||||||||
Revenue passenger miles (RPM) (a) |
2,601.5 |
2,271.7 |
14.5% |
10,139.9 |
8,665.9 |
17.0% |
|||||||
Available seat miles (ASM) (a) |
3,094.7 |
2,651.3 |
16.7% |
12,022.2 |
10,134.6 |
18.6% |
|||||||
Passenger revenue per RPM (Yield) |
14.96 |
cents |
13.37 |
cents |
11.9% |
14.60 |
cents |
13.33 |
cents |
9.5% |
|||
Passenger load factor (RPM/ASM) |
84.1% |
85.7% |
(1.6) |
pt. |
84.3% |
85.5% |
(1.2) |
pt. |
|||||
Passenger revenue per ASM (PRASM) |
12.58 |
cents |
11.46 |
cents |
9.8% |
12.32 |
cents |
11.40 |
cents |
8.1% |
|||
Total Operations: |
|||||||||||||
Revenue passenger miles (RPM) (a) |
2,607.5 |
2,276.8 |
14.5% |
10,151.2 |
8,675.4 |
17.0% |
|||||||
Available seat miles (ASM) (a) |
3,104.8 |
2,660.4 |
16.7% |
12,039.9 |
10,150.7 |
18.6% |
|||||||
Passenger load factor (RPM/ASM) |
84.0% |
85.6% |
(1.6) |
pt. |
84.3% |
85.5% |
(1.2) |
pt. |
|||||
Operating Revenue per ASM (RASM) |
13.98 |
cents |
12.92 |
cents |
8.2% |
13.71 |
cents |
12.91 |
cents |
6.2% |
|||
Operating Cost per ASM (CASM) |
12.87 |
cents |
12.08 |
cents |
6.5% |
13.54 |
cents |
12.01 |
cents |
12.7% |
|||
CASM excluding aircraft fuel |
8.60 |
cents |
8.71 |
cents |
(1.3%) |
9.28 |
cents |
8.83 |
cents |
5.1% |
|||
CASM excluding lease termination costs and aircraft fuel |
8.60 |
cents |
8.71 |
cents |
(1.3%) |
8.70 |
cents |
8.83 |
cents |
(1.5%) |
|||
Gallons of jet fuel consumed (a) |
42.3 |
36.7 |
15.3% |
164.0 |
141.0 |
16.3% |
|||||||
Average cost per gallon of jet fuel (actual) (b) |
$ 3.13 |
$ 2.44 |
28.3% |
$ 3.13 |
$ 2.29 |
36.7% |
|||||||
(a) In millions. |
|||||||||||||
(b) Includes applicable taxes and fees. |
|||||||||||||
Table 3. Hawaiian Holdings, Inc. Economic Fuel Expense (in thousands, except per-gallon amounts) |
||||||||||||
Three Months Ended December 31, |
Twelve Months Ended December 31, |
|||||||||||
2011 |
2010 |
Change |
2011 |
2010 |
Change |
|||||||
Aircraft fuel expense, including taxes and oil |
$ 132,494 |
$ 89,673 |
47.8% |
$ 513,284 |
# |
$ 322,999 |
58.9% |
|||||
Realized losses on settlement of fuel derivative contracts |
2,722 |
48 |
5570.8% |
430 |
3,199 |
(86.6%) |
||||||
Economic fuel expense |
$ 135,216 |
$ 89,721 |
50.7% |
$ 513,714 |
$ 326,198 |
57.5% |
||||||
Fuel gallons consumed |
42,285 |
36,673 |
15.3% |
164,002 |
140,995 |
16.3% |
||||||
Economic fuel cost per gallon |
$ 3.20 |
$ 2.45 |
30.6% |
$ 3.13 |
$ 2.31 |
35.5% |
||||||
Table 4. Hawaiian Holdings, Inc. Pro-forma Net Income and Diluted Earnings Per Share Reflecting Economic Fuel Expense and Excluding Non-Recurring Tax Benefits and Lease Termination Charges (in thousands, except for per share data) |
||||||||||||||||
Three months ended December 31, |
Twelve months ended December 31, |
|||||||||||||||
2011 |
2010 |
2011 |
2010 |
|||||||||||||
Net income |
Diluted |
Net income |
Diluted |
Net income |
Diluted |
Net income |
Diluted |
|||||||||
(in thousands, except for per share data) |
||||||||||||||||
As reported - GAAP |
$ 20,921 |
$ 0.40 |
$ 70,579 |
$ 1.36 |
$ (2,649) |
$ (0.05) |
$ 110,255 |
$ 2.10 |
||||||||
Add: lease termination expenses related to Boeing |
||||||||||||||||
717-200 aircraft purchase, net of tax |
- |
- |
- |
- |
42,008 |
0.83 |
- |
- |
||||||||
Reflecting lease termination costs adjustment |
$ 20,921 |
$ 0.40 |
$ 70,579 |
$ 1.36 |
$ 39,359 |
$ 0.78 |
$ 110,255 |
$ 2.10 |
||||||||
Less: unrealized (losses) gains on fuel derivative |
||||||||||||||||
contracts, net of tax |
4,584 |
0.09 |
2,430 |
0.05 |
(3,859) |
(0.07) |
2,304 |
0.04 |
||||||||
Less: Non-recurring tax benefits |
- |
- |
56,881 |
1.10 |
- |
- |
62,546 |
1.19 |
||||||||
Reflecting economic fuel expense and excluding non-recurring |
||||||||||||||||
tax benefits and lease termination charges |
$ 16,337 |
$ 0.31 |
$ 11,268 |
$ 0.21 |
$ 43,218 |
$ 0.85 |
$ 45,405 |
$ 0.87 |
||||||||
Table 5. Hawaiian Holdings, Inc. Fuel Derivative Contract Summary As of January 26, 2012 |
|||||||
Weighted Average Contract |
Percentage of Projected |
Fuel Barrels Hedged |
|||||
First Quarter 2012 |
|||||||
Heating Oil |
(per gallon) |
||||||
Call Options |
$3.06 |
15% |
101,000 |
||||
Collars |
Cap |
Floor |
|||||
$3.09 |
$2.72 |
17% |
175,000 |
||||
Crude Oil |
(per barrel) |
||||||
Brent Options |
$113.38 |
1% |
30,000 |
||||
Call Options |
$113.53 |
23% |
236,000 |
||||
Brent Collars |
Cap |
Floor |
|||||
$109.19 |
$96.98 |
1% |
9,000 |
||||
Collars |
Cap |
Floor |
|||||
$103.93 |
$89.88 |
5% |
48,000 |
||||
Total |
62% |
599,000 |
|||||
Second Quarter 2012 |
|||||||
Heating Oil |
(per gallon) |
||||||
Call Options |
$3.31 |
2% |
15,000 |
||||
Collars |
Cap |
Floor |
|||||
$3.03 |
$2.65 |
17% |
194,000 |
||||
Crude Oil |
(per barrel) |
||||||
Brent Options |
$115.36 |
3% |
93,000 |
||||
Call Options |
$114.93 |
9% |
103,000 |
||||
Brent Collars |
Cap |
Floor |
|||||
$111.93 |
$97.05 |
11% |
42,000 |
||||
Collars |
Cap |
Floor |
|||||
$106.58 |
$89.88 |
4% |
48,000 |
||||
Total |
46% |
495,000 |
|||||
Third Quarter 2012 |
|||||||
Heating Oil |
(per gallon) |
||||||
Call Options |
|||||||
Collars |
Cap |
Floor |
|||||
$3.05 |
$2.66 |
13% |
168,000 |
||||
Crude Oil |
(per barrel) |
||||||
Brent Options |
$120.91 |
8% |
108,000 |
||||
Call Options |
$112.56 |
1% |
7,000 |
||||
Brent Collars |
Cap |
Floor |
|||||
$111.48 |
$96.56 |
3% |
42,000 |
||||
Collars |
Cap |
Floor |
|||||
$107.30 |
$90.30 |
2% |
28,000 |
||||
Total |
27% |
353,000 |
|||||
Fourth Quarter 2012 |
|||||||
Heating Oil |
(per gallon) |
||||||
Call Options |
|||||||
Collars |
Cap |
Floor |
|||||
$3.07 |
$2.65 |
6% |
71,000 |
||||
Crude Oil |
(per barrel) |
||||||
Brent Options |
$122.20 |
9% |
108,000 |
||||
Call Options |
|||||||
Brent Collars |
Cap |
Floor |
|||||
$111.00 |
$95.01 |
3% |
42,000 |
||||
Collars |
Cap |
Floor |
|||||
Total |
18% |
221,000 |
|||||
First Quarter 2013 |
|||||||
Crude Oil |
(per barrel) |
||||||
Brent Options |
$123.35 |
1% |
16,000 |
||||
Table 6. Hawaiian Holdings, Inc. Reconciliation of Non-GAAP Financial Measures (in millions, except for CASM data) (unaudited) |
|||||||||
Three Months Ended |
Twelve Months Ended |
||||||||
December 31, |
December 31, |
||||||||
2011 |
2010 |
2011 |
2010 |
||||||
GAAP operating income |
$ 34.5 |
$ 22.4 |
$ 20.3 |
$ 91.3 |
|||||
Add: lease termination costs related to Boeing 717 aircraft purchase |
- |
- |
70.0 |
- |
|||||
Adjusted operating income - excluding lease termination costs related to |
|||||||||
Boeing 717 aircraft purchase |
$ 34.5 |
$ 22.4 |
$ 90.3 |
$ 91.3 |
|||||
GAAP operating expenses |
$ 399.5 |
$ 321.4 |
$ 1,630.2 |
$ 1,218.8 |
|||||
Less: lease termination costs related to Boeing 717 aircraft purchase |
- |
- |
70.0 |
- |
|||||
Adjusted operating expenses - excluding lease termination costs related to |
|||||||||
Boeing 717 aircraft purchase |
399.5 |
321.4 |
1,560.2 |
1,218.8 |
|||||
Less: aircraft fuel, including taxes and oil |
132.5 |
89.7 |
513.3 |
323.0 |
|||||
Adjusted operating expenses - excluding lease termination costs related to |
|||||||||
Boeing 717 aircraft purchase and aircraft fuel |
$ 267.0 |
$ 231.7 |
$ 1,046.9 |
$ 895.8 |
|||||
Available Seat Miles |
3,104.8 |
2,660.4 |
12,039.9 |
10,150.7 |
|||||
CASM - GAAP |
12.87 |
cents |
12.08 |
cents |
13.54 |
cents |
12.01 |
cents |
|
Less: lease termination costs related to Boeing 717 aircraft purchase |
- |
- |
0.58 |
- |
|||||
Less: aircraft fuel |
4.27 |
3.37 |
4.26 |
3.18 |
|||||
CASM - excluding aircraft fuel and lease termination costs related to Boeing 717 |
|||||||||
aircraft purchase |
8.60 |
cents |
8.71 |
cents |
8.70 |
cents |
8.83 |
cents |
|
SOURCE