HONOLULU, July 28, 2020 /PRNewswire/ -- Hawaiian
Holdings, Inc. (NASDAQ: HA) ("we" or the "Company"), parent
company of Hawaiian Airlines, Inc. ("Hawaiian"), today
announced the addition of C. Jayne
Hrdlicka, former CEO of Australia-based Jetstar Group, and
Michael E. McNamara, Executive Vice
President and CIO of Target Corporation to its Board of
Directors.
Hrdlicka, who served as CEO of New
Zealand's a2 Milk Company after her time at Jetstar parent
Qantas Airways, has substantial experience in the airline and
retail sectors. McNamara joined Target in 2015 and in his
capacity as CIO has overseen the transformation of the retailer's
technology portfolio. Prior to joining Target, McNamara held
positions of increasing authority with TESCO, a publicly traded
international retailer headquartered in the UK.
"We welcome the additional experience and perspective both Jayne
and Mike will bring to our Board of Directors, particularly as we
emerge from the COVID-19 pandemic," said Larry Hershfield, Chairman of the Board of
Directors of Hawaiian Holdings, Inc. "Jayne brings
significant airline and international perspective to our company,
while Mike adds deep expertise in technology with consumer-focused
companies."
Also today, the Company reported its financial results for the
second quarter of 2020.
Second Quarter
2020 - Key Financial Metrics
|
|
|
GAAP
|
|
YoY
Change
|
|
Adjusted
|
|
YoY
Change
|
Net
Income
|
|
($106.9M)
|
|
($164.7M)
|
|
($174.7M)
|
|
($233.6M)
|
Diluted
EPS
|
|
($2.33)
|
|
($3.54)
|
|
($3.81)
|
|
($5.04)
|
Pre-tax
Margin
|
|
(254.2)%
|
|
(265.4)
pts.
|
|
(383.9)%
|
|
(395.3)
pts.
|
"Our second quarter results reflect the continued impact of
COVID-19 and State of Hawai'i quarantines on our business," said
Peter Ingram, Hawaiian Airlines
President and CEO. "In the face of these unprecedented
challenges, we have taken action to preserve and raise cash and are
crafting plans to position us for the future even as we address the
immediate adversity. With our leisure business model and
relentless focus on the needs of the Hawai'i traveler, we are
positioned to emerge from this crisis poised for success. I
am grateful, as always, for the efforts of my extraordinary
colleagues, as they take care of our guests and adapt to this
ever-changing environment with passion and dedication."
Liquidity and Capital Resources
As of June 30, 2020, the Company had:
- Unrestricted cash, cash equivalents and short-term investments
of $761 million
- Outstanding debt and finance lease obligations of $1,006 million
- Air traffic liability of $554
million
Second Quarter 2020
The State of Hawai'i was under the mandatory 14-day
self-quarantine for both neighbor island and all incoming travelers
for most of the second quarter of 2020, and as a consequence, the
Company operated an extremely limited schedule. The mandatory
14-day self-quarantine restriction was lifted on June 16, 2020 for neighbor island travel only.
Following this announcement, the Company increased neighbor island
flight activity, but continued with its reduced schedule for longer
haul flights.
In addition to service suspension and schedule reduction, the
Company has taken, and will continue to take, actions to minimize
cash outflow in an effort to mitigate the effects of reduced
demand, including, but not limited to:
- Suspended dividend payments on, and the repurchase of, its
common stock
- Instituted a hiring freeze across the Company, except for
operationally critical and essential positions
- Deferred non-critical capital expenditures
- Instituted voluntary unpaid leave programs and exploring
involuntary headcount reduction
- Reduced executive pay by 10% - 50%
- Reduced other discretionary spending, including contractor and
vendor spend
- Negotiated payment deferrals with key vendors
As of June 30, 2020, the Company
has received $214.2 million in grants
and $49.0 million in loans pursuant
to the Coronavirus Aid, Relief, and Economic Security Act (the
"CARES Act") Payroll Support Program ("PSP"). The Company expects
to receive an additional $29.2
million in July 2020.
Third Quarter 2020
Due to the uncertain timing of the relaxation of travel and
quarantine restrictions, the Company is unable to provide detailed
guidance related to capacity expectations for the quarter ending
September 30, 2020.
July 2020 capacity, in terms of
available seat miles (ASMs), is expected to be approximately 86%
below the capacity flown in July
2019, and the Company expects August
2020 capacity to decrease 85% compared to August 2019.
As a significant portion of the Company's costs are fixed,
operating expenses are not expected to decline in proportion to the
capacity decline.
To further increase liquidity, the Company has entered into
additional financing transactions in July
2020. This includes the following:
- Raised $114 million through the
sale and leaseback of two Airbus A321neo aircraft
- Signed a non-binding letter of intent with the U.S. Department
of Treasury pursuant to which the Company is eligible to receive up
to $364 million in Economic Relief
Program ("ERP") loans offered under the CARES Act; the Company has
until March 2021 to determine how
much of the available ERP funds to borrow.
COVID-19 Response - Guest Experience and Community
Relations
In response to the COVID-19 pandemic, the Company has enhanced
cleaning procedures and revised guest-facing procedures in an
effort to minimize the risk of transmission of COVID-19. These
procedures are in line with current recommendations from leading
public health authorities and include:
- Performing enhanced aircraft cleaning between flights and
overnight, including recurring electrostatic spraying of all
aircraft
- Frequent cleaning and disinfecting of counters and self-service
check-in kiosks in our airports
- Ensuring hand sanitizers are readily available for guests
statewide and at our mainland airports
- Requiring guests and guest-facing employees to wear face masks
or coverings, with guests required to keep them on from check-in to
deplaning
- Modifying boarding and deplaning processes and limiting the
capacity of available seats on all aircraft to no higher than 70%
to provide physical distancing
- Changing in-flight service to reduce close interactions between
crew members and guests
The Company, along with its employees, has also taken measures
to support the community through the COVID-19 pandemic, which
include:
- Donating Main Cabin and Business Class pillowcases, blankets,
mattress pads, amenity kits, and Business Class slippers to 12
local organizations serving the community during the pandemic
- Offering complimentary neighbor island transportation for
medical professionals in April and May
- Providing complimentary transportation of food and household
items from O'ahu to both Moloka'i and Lana'i in April and May
- Volunteering to support local non-profit organizations
addressing the COVID-19 pandemic, from company-wide efforts to
individual employee initiatives
Statistical information, as well as a reconciliation of the
non-GAAP financial measures, can be found in the accompanying
tables.
Investor Conference Call
Hawaiian Holdings' quarterly results conference call is
scheduled to begin today (July 28, 2020) at 4:30 p.m. Eastern Time (USA). The conference call will be
broadcast live over the Internet. Investors may access and listen
to the live audio webcast on the investor relations section of the
Company's website at HawaiianAirlines.com. For those who are
not available for the live webcast, a replay of the webcast will be
archived for 90 days on the investor relations section of the
Company's website.
About Hawaiian Airlines
Hawaiian Airlines, Inc. is a subsidiary of Hawaiian Holdings,
Inc. (NASDAQ: HA). Additional information is available at
HawaiianAirlines.com. Follow Hawaiian's Twitter updates
(@HawaiianAir), become a fan on Facebook (Hawaiian Airlines), and
follow us on Instagram (hawaiianairlines). For career postings and
updates, follow Hawaiian's LinkedIn page.
For media inquiries, please visit Hawaiian Airlines' online
newsroom.
Forward-Looking Statements
This press release contains "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, the
Company's business plans and ability to successfully emerge from
the COVID-19 pandemic; the Company's response to developments
related to the COVID-19 pandemic; the Company's efforts to minimize
cash outflow, mitigate the effects of declining demand and increase
liquidity; expectations regarding available seat miles for the
months of July and August 2020 and
the Company's operating expenses in the third quarter of 2020; and
statements as to other matters that do not relate strictly to
historical facts or 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 subject to many risks,
uncertainties and assumptions 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.
These risks and uncertainties include, without limitation, the
continuing and developing effects of the spread of COVID-19 on the
Company's business operations and financial condition; whether the
Company's cost-cutting plans related to the COVID-19 pandemic will
be effective or sufficient; the duration of government-mandated and
other restrictions on travel; the full effect that the quarantine,
restrictions on travel and other measures to limit the spread of
COVID-19 will have on demand for air travel in the markets in which
the Company operates; fluctuations and the extent of declining
demand for air transportation in the markets in which the Company
operates; the Company's dependence on the tourism industry; the
Company's ability to generate sufficient cash and manage its
available cash; the Company's ability to accurately forecast
economic volatility; macroeconomic developments; political
developments; the price and availability of aircraft fuel; labor
negotiations; regulatory determinations and related developments;
competitive pressures, including the impact of industry capacity
between North America and Hawai'i
and interisland; changes in the Company's future capital needs; and
foreign currency exchange rate fluctuations.
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
and the Company's Quarterly Reports on Form 10-Q, as well as other
documents that may be filed by the Company from time to time with
the Securities and Exchange Commission. All forward-looking
statements included in this document are based on information
available to the Company on the date hereof. The Company does
not undertake to publicly update or revise any forward-looking
statements to reflect events or circumstances that may arise after
the date hereof even if experience or future changes make it clear
that any projected results expressed or implied herein will not be
realized.
Table
1. Hawaiian Holdings, Inc. Consolidated
Statements of Operations (unaudited)
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
2020
|
|
2019
|
|
%
Change
|
|
2020
|
|
2019
|
|
%
Change
|
|
|
(in thousands,
except per share data)
|
Operating
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
Passenger
|
|
$
|
29,762
|
|
|
$
|
653,423
|
|
|
(95.4)
|
%
|
|
$
|
533,231
|
|
|
$
|
1,254,727
|
|
|
(57.5)
|
%
|
Other
|
|
30,242
|
|
|
58,766
|
|
|
(48.5)
|
%
|
|
85,917
|
|
|
114,213
|
|
|
(24.8)
|
%
|
Total
|
|
60,004
|
|
|
712,189
|
|
|
(91.6)
|
%
|
|
619,148
|
|
|
1,368,940
|
|
|
(54.8)
|
%
|
Operating
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Wages and
benefits
|
|
30,329
|
|
|
180,070
|
|
|
(83.2)
|
%
|
|
218,583
|
|
|
355,135
|
|
|
(38.5)
|
%
|
Aircraft fuel,
including taxes and delivery
|
|
7,003
|
|
|
140,600
|
|
|
(95.0)
|
%
|
|
120,481
|
|
|
266,704
|
|
|
(54.8)
|
%
|
Maintenance, materials
and repairs
|
|
13,994
|
|
|
58,131
|
|
|
(75.9)
|
%
|
|
74,403
|
|
|
121,176
|
|
|
(38.6)
|
%
|
Aircraft and passenger
servicing
|
|
3,036
|
|
|
39,641
|
|
|
(92.3)
|
%
|
|
41,319
|
|
|
78,541
|
|
|
(47.4)
|
%
|
Depreciation and
amortization
|
|
39,333
|
|
|
39,527
|
|
|
(0.5)
|
%
|
|
78,782
|
|
|
77,678
|
|
|
1.4
|
%
|
Commissions and other
selling
|
|
2,927
|
|
|
32,471
|
|
|
(91.0)
|
%
|
|
29,643
|
|
|
63,307
|
|
|
(53.2)
|
%
|
Aircraft
rent
|
|
23,886
|
|
|
30,843
|
|
|
(22.6)
|
%
|
|
50,890
|
|
|
61,239
|
|
|
(16.9)
|
%
|
Other rentals and
landing fees
|
|
13,677
|
|
|
31,386
|
|
|
(56.4)
|
%
|
|
43,443
|
|
|
62,432
|
|
|
(30.4)
|
%
|
Purchased
services
|
|
19,887
|
|
|
32,733
|
|
|
(39.2)
|
%
|
|
54,128
|
|
|
65,186
|
|
|
(17.0)
|
%
|
Special
items
|
|
34,014
|
|
|
—
|
|
|
100.0
|
%
|
|
160,918
|
|
|
—
|
|
|
100.0
|
%
|
Other
|
|
20,882
|
|
|
37,906
|
|
|
(44.9)
|
%
|
|
63,618
|
|
|
75,985
|
|
|
(16.3)
|
%
|
Total
|
|
208,968
|
|
|
623,308
|
|
|
(66.5)
|
%
|
|
936,208
|
|
|
1,227,383
|
|
|
(23.7)
|
%
|
Operating Income
(Loss)
|
|
(148,964)
|
|
|
88,881
|
|
|
(267.6)
|
%
|
|
(317,060)
|
|
|
141,557
|
|
|
(324.0)
|
%
|
Nonoperating
Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense and
amortization of debt discounts and issuance costs
|
|
(8,221)
|
|
|
(7,300)
|
|
|
|
|
(15,016)
|
|
|
(14,830)
|
|
|
|
Interest
income
|
|
2,766
|
|
|
3,074
|
|
|
|
|
5,786
|
|
|
6,057
|
|
|
|
Capitalized
interest
|
|
921
|
|
|
1,257
|
|
|
|
|
1,752
|
|
|
2,542
|
|
|
|
Gains (losses) on fuel
derivatives
|
|
(184)
|
|
|
(3,220)
|
|
|
|
|
(6,636)
|
|
|
(2,650)
|
|
|
|
Other, net
|
|
1,161
|
|
|
(3,083)
|
|
|
|
|
3,465
|
|
|
(4,108)
|
|
|
|
Total
|
|
(3,557)
|
|
|
(9,272)
|
|
|
|
|
(10,649)
|
|
|
(12,989)
|
|
|
|
Income (Loss)
Before Income Taxes
|
|
(152,521)
|
|
|
79,609
|
|
|
|
|
(327,709)
|
|
|
128,568
|
|
|
|
Income tax expense
(benefit)
|
|
(45,617)
|
|
|
21,776
|
|
|
|
|
(76,433)
|
|
|
34,377
|
|
|
|
Net Income
(Loss)
|
|
$
|
(106,904)
|
|
|
$
|
57,833
|
|
|
|
|
$
|
(251,276)
|
|
|
$
|
94,191
|
|
|
|
Net Income (Loss)
Per Share
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(2.33)
|
|
|
$
|
1.21
|
|
|
|
|
$
|
(5.47)
|
|
|
$
|
1.96
|
|
|
|
Diluted
|
|
$
|
(2.33)
|
|
|
$
|
1.21
|
|
|
|
|
$
|
(5.47)
|
|
|
$
|
1.96
|
|
|
|
Weighted Average
Number of Common Stock Shares Outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
45,971
|
|
|
47,854
|
|
|
|
|
45,969
|
|
|
48,122
|
|
|
|
Diluted
|
|
45,971
|
|
|
47,889
|
|
|
|
|
45,969
|
|
|
48,158
|
|
|
|
Table 2.
Hawaiian Holdings, Inc.
Selected Statistical Data (unaudited)
|
|
|
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
|
2020
|
|
2019
|
|
%
Change
|
|
2020
|
|
2019
|
|
%
Change
|
|
|
(in thousands, except as otherwise indicated)
|
Scheduled
Operations (a) :
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue passengers
flown
|
|
182
|
|
|
2,957
|
|
|
(93.8)
|
%
|
|
2,542
|
|
|
5,777
|
|
|
(56.0)
|
%
|
Revenue passenger
miles (RPM)
|
|
95,084
|
|
|
4,487,362
|
|
|
(97.9)
|
%
|
|
3,806,558
|
|
|
8,615,090
|
|
|
(55.8)
|
%
|
Available seat miles
(ASM)
|
|
409,490
|
|
|
5,153,025
|
|
|
(92.1)
|
%
|
|
5,384,460
|
|
|
10,003,748
|
|
|
(46.2)
|
%
|
Passenger revenue per
RPM (Yield)
|
|
31.30
|
¢
|
|
14.56
|
¢
|
|
115.0
|
%
|
|
14.01
|
¢
|
|
14.56
|
¢
|
|
(3.8)
|
%
|
Passenger load factor
(RPM/ASM)
|
|
23.2
|
%
|
|
87.1
|
%
|
|
(63.9)
|
pts.
|
|
70.7
|
%
|
|
86.1
|
%
|
|
(15.4)
|
pts.
|
Passenger revenue per
ASM (PRASM)
|
|
7.27
|
¢
|
|
12.68
|
¢
|
|
(42.7)
|
%
|
|
9.90
|
¢
|
|
12.54
|
¢
|
|
(21.1)
|
%
|
Total Operations
(a) :
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue passengers
flown
|
|
182
|
|
|
2,959
|
|
|
(93.8)
|
%
|
|
2,544
|
|
|
5,781
|
|
|
(56.0)
|
%
|
Revenue passenger
miles (RPM)
|
|
95,084
|
|
|
4,491,974
|
|
|
(97.9)
|
%
|
|
3,809,858
|
|
|
8,620,459
|
|
|
(55.8)
|
%
|
Available seat miles
(ASM)
|
|
409,490
|
|
|
5,157,677
|
|
|
(92.1)
|
%
|
|
5,389,019
|
|
|
10,009,598
|
|
|
(46.2)
|
%
|
Operating revenue per
ASM (RASM)
|
|
14.65
|
¢
|
|
13.81
|
¢
|
|
6.1
|
%
|
|
11.49
|
¢
|
|
13.68
|
¢
|
|
(16.0)
|
%
|
Operating cost per ASM
(CASM)
|
|
51.03
|
¢
|
|
12.09
|
¢
|
|
322.1
|
%
|
|
17.37
|
¢
|
|
12.26
|
¢
|
|
41.7
|
%
|
CASM excluding
aircraft fuel and non-recurring items (b)
|
|
68.26
|
¢
|
|
9.38
|
¢
|
|
627.7
|
%
|
|
14.22
|
¢
|
|
9.62
|
¢
|
|
47.8
|
%
|
Aircraft fuel expense
per ASM (c)
|
|
1.70
|
¢
|
|
2.73
|
¢
|
|
(37.7)
|
%
|
|
2.23
|
¢
|
|
2.66
|
¢
|
|
(16.2)
|
%
|
Revenue block hours
operated
|
|
6,496
|
|
|
54,840
|
|
|
(88.2)
|
%
|
|
59,355
|
|
|
106,466
|
|
|
(44.2)
|
%
|
Gallons of jet fuel
consumed
|
|
7,759
|
|
|
67,277
|
|
|
(88.5)
|
%
|
|
71,580
|
|
|
131,798
|
|
|
(45.7)
|
%
|
Average cost per
gallon of jet fuel (actual) (c)
|
|
$
|
0.90
|
|
|
$
|
2.09
|
|
|
(56.9)
|
%
|
|
$
|
1.68
|
|
|
$
|
2.02
|
|
|
(16.8)
|
%
|
Economic fuel cost per
gallon (c)(d)
|
|
$
|
1.26
|
|
|
$
|
2.14
|
|
|
(41.1)
|
%
|
|
$
|
1.76
|
|
|
$
|
2.07
|
|
|
(15.0)
|
%
|
(a)
|
Includes the
operations of the Company's contract carrier under a capacity
purchase agreement.
|
(b)
|
See Table 4 for a
reconciliation of GAAP operating expenses to operating expenses
excluding aircraft fuel and non-recurring items.
|
(c)
|
Includes applicable
taxes and fees.
|
(d)
|
See Table 3 for a
reconciliation of GAAP fuel costs to economic fuel
costs.
|
Table
3.
|
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.
|
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
|
2020
|
|
2019
|
|
%
Change
|
|
2020
|
|
2019
|
|
%
Change
|
|
|
(in thousands,
except per-gallon amounts)
|
Aircraft fuel
expense, including taxes and delivery
|
|
$
|
7,003
|
|
|
$
|
140,600
|
|
|
(95.0)
|
%
|
|
$
|
120,481
|
|
|
$
|
266,704
|
|
|
(54.8)
|
%
|
Realized losses on
settlement of fuel derivative contracts
|
|
2,751
|
|
|
3,051
|
|
|
(9.8)
|
%
|
|
5,837
|
|
|
5,895
|
|
|
(1.0)
|
%
|
Economic fuel
expense
|
|
$
|
9,754
|
|
|
$
|
143,651
|
|
|
(93.2)
|
%
|
|
$
|
126,318
|
|
|
$
|
272,599
|
|
|
(53.7)
|
%
|
Fuel gallons
consumed
|
|
7,759
|
|
|
67,277
|
|
|
(88.5)
|
%
|
|
71,580
|
|
|
131,798
|
|
|
(45.7)
|
%
|
Economic fuel costs
per gallon
|
|
$
|
1.26
|
|
|
$
|
2.14
|
|
|
(41.1)
|
%
|
|
$
|
1.76
|
|
|
$
|
2.07
|
|
|
(15.0)
|
%
|
Table
4.
|
Hawaiian
Holdings, Inc.
|
Non-GAAP Financial
Reconciliation (unaudited)
|
The Company evaluates its financial performance utilizing
various GAAP and non-GAAP financial measures, including net income,
diluted net income per share, CASM, PRASM, RASM, Passenger Revenue
per RPM, EBITDAR, and pre-tax margin. Pursuant to Regulation
G, the Company has included the following reconciliation of
reported non-GAAP financial measures to comparable financial
measures reported on a GAAP basis. The adjustments are
described below:
- During the three and six months ended June 30, 2020, the effective tax rate included a
tax benefit of $9.2 million and
$23.4 million, respectively,
resulting from the rate differential between the prevailing tax
rate of 21% during the years that generated net operating losses
and the previous tax rate of 35% that was in effect during the
years to which net operating losses were carried back as a result
of the enactment of the CARES Act.
- During the three and six months ended June 30, 2020, the Company recognized
$111.6 million in contra-expense
related to grant proceeds from the PSP. The grant proceeds are
recognized in proportion to estimated wages and benefits expense
over the 6-month period the PSP covers. The Company expects to use
all proceeds from the PSP by the end of 2020.
- Changes in fair value of fuel derivative contracts, net of tax,
are based on market prices for open contracts as of the end of the
reporting period, and include the unrealized amounts of fuel
derivatives (not designated as hedges) that will settle in future
periods and the reversal of prior period unrealized amounts.
- Changes in fair value of foreign currency derivative contracts,
net of tax, are based on market prices for open contracts as of the
end of the reporting period, including the unrealized amounts of
foreign currency derivatives (not designated as hedges) that will
settle in future periods and the reversal of prior period
unrealized amounts.
- Unrealized loss (gain) on foreign debt is based on fluctuation
in exchange rates and the measurement of foreign-denominated debt
to our functional currency.
- The Company recorded the following as special items:
-
- During the three months ended June 30,
2020, an impairment charge of $27.5
million was recorded related to the Company's ATR-42 and
ATR-72 fleets. An additional impairment charge of $3.4 million was recorded related to the
Company's commercial real estate subsidiary.
- During the three months ended June 30,
2020, the Company recorded $3.1
million of charges related to write-downs of projects
permanently suspended as a result of the COVID-19 pandemic.
- During the three months ended March 31,
2020, a charge of $20.2
million was recorded for the ratification of a collective
bargaining agreement with the Association of Flight Attendants in
April 2020 (related to service prior
to January 1, 2020).
- During the three months ended March 31,
2020, a special charge of $106.7
million was recorded for goodwill impairment resulting from
the decline in the market value of the Company's equity (i.e.,
share price), and the Company's inability to support the carrying
value of goodwill on its financial statements.
- During the three and six months ended June 30, 2019, the Company recorded a gain on
disposal of Boeing 767-300 aircraft equipment of $0.9 million and $1.9
million, respectively, in conjunction with the retirement of
its B767 fleet.
The Company believes that adjusting for the impact of an
effective tax rate differential, changes in fair value of fuel
derivative contracts and foreign currency derivative contracts,
fluctuations in foreign exchange rates, special items, and the sale
of aircraft and aircraft equipment helps investors better analyze
the Company's operational performance and compare its results to
other airlines in the periods presented.
|
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
Total
|
|
Diluted
Net Loss
Per Share
|
|
Total
|
|
Diluted
Net Income
Per Share
|
|
Total
|
|
Diluted
Net Loss
Per Share
|
|
Total
|
|
Diluted
Net Income
Per Share
|
|
|
(in thousands,
except per share data)
|
GAAP Net Income
(Loss), as reported
|
|
$
|
(106,904)
|
|
|
$
|
(2.33)
|
|
|
$
|
57,833
|
|
|
$
|
1.21
|
|
|
$
|
(251,276)
|
|
|
$
|
(5.47)
|
|
|
$
|
94,191
|
|
|
$
|
1.96
|
|
Add: CARES Act
carryback of additional NOLs
|
|
(9,238)
|
|
|
(0.20)
|
|
|
—
|
|
|
—
|
|
|
(23,394)
|
|
|
(0.51)
|
|
|
—
|
|
|
—
|
|
Add: CARES Act grant
recognition
|
|
(111,560)
|
|
|
(2.43)
|
|
|
—
|
|
|
—
|
|
|
(111,560)
|
|
|
(2.43)
|
|
|
—
|
|
|
—
|
|
Add (deduct): changes
in fair value of fuel derivative contracts
|
|
(2,567)
|
|
|
(0.06)
|
|
|
169
|
|
|
—
|
|
|
799
|
|
|
0.02
|
|
|
(3,245)
|
|
|
(0.07)
|
|
Add: unrealized loss
on foreign debt
|
|
1,679
|
|
|
0.04
|
|
|
2,167
|
|
|
0.05
|
|
|
2,422
|
|
|
0.05
|
|
|
1,537
|
|
|
0.03
|
|
Add: gain on sale of
aircraft equipment
|
|
—
|
|
|
—
|
|
|
(851)
|
|
|
(0.02)
|
|
|
—
|
|
|
—
|
|
|
(1,948)
|
|
|
(0.04)
|
|
Add: unrealized loss
(gain) on non-designated fx positions
|
|
612
|
|
|
0.01
|
|
|
—
|
|
|
—
|
|
|
(200)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Add: special
items
|
|
34,014
|
|
|
0.74
|
|
|
—
|
|
|
—
|
|
|
160,918
|
|
|
3.50
|
|
|
—
|
|
|
—
|
|
Deduct: tax effect of
adjustments
|
|
19,253
|
|
|
0.42
|
|
|
(386)
|
|
|
(0.01)
|
|
|
13,430
|
|
|
0.29
|
|
|
951
|
|
|
0.02
|
|
Adjusted Net Income
(Loss)
|
|
$
|
(174,711)
|
|
|
$
|
(3.81)
|
|
|
$
|
58,932
|
|
|
$
|
1.23
|
|
|
$
|
(208,861)
|
|
|
$
|
(4.55)
|
|
|
$
|
91,486
|
|
|
$
|
1.90
|
|
|
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
(in
thousands)
|
Income Before Income
Taxes, as reported
|
|
$
|
(152,521)
|
|
|
$
|
79,609
|
|
|
$
|
(327,709)
|
|
|
$
|
128,568
|
|
Add: CARES Act grant
recognition
|
|
(111,560)
|
|
|
—
|
|
|
(111,560)
|
|
|
—
|
|
Add (deduct): changes
in fair value of fuel derivative contracts
|
|
(2,567)
|
|
|
169
|
|
|
799
|
|
|
(3,245)
|
|
Add: unrealized loss
on foreign debt
|
|
1,679
|
|
|
2,167
|
|
|
2,422
|
|
|
1,537
|
|
Add: gain on sale of
aircraft and equipment
|
|
—
|
|
|
(851)
|
|
|
|
|
(1,948)
|
|
Add: unrealized
loss (gain) on non-designated fx positions
|
|
612
|
|
|
—
|
|
|
(200)
|
|
|
—
|
|
Add: special
items
|
|
34,014
|
|
|
—
|
|
|
160,918
|
|
|
—
|
|
Adjusted Income
Before Income Taxes
|
|
$
|
(230,343)
|
|
|
$
|
81,094
|
|
|
$
|
(275,330)
|
|
|
$
|
124,912
|
|
Operating Costs per Available Seat Mile (CASM)
The Company has separately listed in the table below its fuel
costs per ASM and non-GAAP unit costs, excluding fuel and
non-recurring items. These amounts are included in CASM, but
for internal purposes the Company consistently uses cost metrics
that exclude fuel and non-recurring items (if applicable) to
measure and monitor its costs.
|
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
(in thousands,
except CASM data)
|
GAAP Operating
Expenses
|
|
$
|
208,968
|
|
|
$
|
623,308
|
|
|
$
|
936,208
|
|
|
$
|
1,227,383
|
|
Less: aircraft fuel,
including taxes and delivery
|
|
(7,003)
|
|
|
(140,600)
|
|
|
(120,481)
|
|
|
(266,704)
|
|
Less: CARES Act grant
recognition
|
|
111,560
|
|
|
—
|
|
|
111,560
|
|
|
—
|
|
Less: gain on sale of
aircraft and equipment
|
|
—
|
|
|
851
|
|
|
—
|
|
|
1,948
|
|
Less: special
items
|
|
(34,014)
|
|
|
—
|
|
|
$
|
(160,918)
|
|
|
—
|
|
Adjusted Operating
Expenses
|
|
$
|
279,511
|
|
|
$
|
483,559
|
|
|
$
|
766,369
|
|
|
$
|
962,627
|
|
Available Seat
Miles
|
|
409,490
|
|
|
5,157,677
|
|
|
5,389,019
|
|
|
10,009,598
|
|
CASM -
GAAP
|
|
51.03
|
¢
|
|
12.09
|
¢
|
|
17.37
|
¢
|
|
12.26
|
¢
|
Less: aircraft fuel,
including taxes and delivery
|
|
(1.70)
|
|
|
(2.73)
|
|
|
(2.23)
|
|
|
(2.66)
|
|
Less: CARES Act grant
recognition
|
|
27.24
|
|
|
—
|
|
|
2.07
|
|
|
—
|
|
Less: gain on sale of
aircraft and equipment
|
|
—
|
|
|
0.02
|
|
|
—
|
|
|
0.02
|
|
Less: special
items
|
|
(8.31)
|
|
|
—
|
|
|
(2.99)
|
|
|
—
|
|
Adjusted
CASM
|
|
68.26
|
¢
|
|
9.38
|
¢
|
|
14.22
|
¢
|
|
9.62
|
¢
|
Pre-tax margin
The Company excludes unrealized losses (gains) from fuel
derivative contracts and foreign currency derivative contracts, and
non-recurring items from pre-tax margin for the same reasons as
described above.
|
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Pre-Tax Margin, as
reported
|
|
(254.2)
|
%
|
|
11.2
|
%
|
|
(52.9)
|
%
|
|
9.4
|
%
|
Add: CARES Act grant
recognition
|
|
(185.9)
|
|
|
—
|
|
|
(18.0)
|
|
|
—
|
|
Add: changes in fair
value of fuel derivative contracts
|
|
(4.3)
|
|
|
—
|
|
|
0.1
|
|
|
(0.2)
|
|
Add: unrealized loss
on foreign debt
|
|
2.8
|
|
|
0.3
|
|
|
0.3
|
|
|
0.1
|
|
Add: gain on sale of
aircraft and equipment
|
|
—
|
|
|
(0.1)
|
|
|
—
|
|
|
(0.1)
|
|
Add: unrealized loss
(gain) on non-designated fx positions
|
|
1.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Add: special
items
|
|
56.7
|
|
|
—
|
|
|
26.0
|
|
|
—
|
|
Adjusted Pre-Tax
Margin
|
|
(383.9)
|
%
|
|
11.4
|
%
|
|
(44.5)
|
%
|
|
9.2
|
%
|
View original content to download
multimedia:http://www.prnewswire.com/news-releases/hawaiian-holdings-adds-two-board-members-reports-2020-second-quarter-financial-results-301101549.html
SOURCE Hawaiian Holdings, Inc.