Hawaiian Holdings reports its 2021 fourth quarter and full-year financial results

Hawaiian Airlines Airbus A321-271N WL N213HA (msn 8237) LAS (Keith Sommer). Image: 956582.

Hawaiian Holdings, Inc., parent company of Hawaiian Airlines, Inc. reported its financial results for the fourth quarter and full year 2021.

Fourth Quarter 2021 – Key Financial Metrics
    GAAP   YoY Change   Adjusted   YoY Change
Net Income (Loss)   ($92.6M)   +$70.0M   ($70.3M)   +$102.5M
Diluted EPS   ($1.81)   +$1.69   ($1.37)   +$2.34
Pre-tax Margin   (24.1)%   +128.7 pts.   (18.4)%   +126.8 pts.

 

Full Year 2021 – Key Financial Metrics
    GAAP   YoY Change   Adjusted   YoY Change
Net Income (Loss)   ($144.8M)   +$366.2M   ($383.4M)   +$167.5M
Diluted EPS   ($2.85)   +$8.23   ($7.55)   +$4.41
Pre-tax Margin   (11.6)%   +71.3 pts.   (30.5)%   +56.7 pts.

“Throughout 2021 the Hawaiian Airlines team has executed a remarkable recovery from the depths of the pandemic.  Demand for leisure travel remains resilient as evidenced by strong domestic travel volumes to Hawaiʻi, and the building blocks continue to fall into place for a recovery of international demand in 2022,” said Peter Ingram, Hawaiian Airlines president and CEO. “I am energized every day by the outstanding contributions of my colleagues throughout Hawaiian who have positioned us for a bright future.”

Statistical data, as well as a reconciliation of the reported non-GAAP financial measures, can be found in the accompanying tables.

Financial Results

Fourth Quarter 2021

The Company reported total revenue of $494.7 million, down 30% compared to the fourth quarter of 2019, on 19% lower capacity.

The Company reported total operating expenses of $566.1 million, and adjusted operating expenses of $443.4 million.

The Company reported EBITDA of ($58.9) million and adjusted EBITDA of ($30.7) million.

 

Full Year 2021

For the full year of 2021, the Company reported total revenue of $1.6 billion, down 44% compared to the full year of 2019, on 29% lower capacity.

The Company reported total operating expenses of $1.7 billion, and adjusted operating expenses of $1.6 billion.

The Company reported EBITDA of $63.4 million and adjusted EBITDA of ($238.7) million.

 

Liquidity and Capital Resources

As of December 31, 2021 the Company had:

  • Unrestricted cash, cash equivalents and short-term investments of $1.7 billion
  • Outstanding debt and finance lease obligations of $1.9 billion
  • Air traffic liability of $631.2 million

As of December 31, 2021, the Company had $2.0 billion in liquidity, including its undrawn $235 million revolving credit facility.

2021 Highlights

Routes and scheduled services

  • Launched four new routes with nonstop flights from Honolulu to Austin, Orlando, and Ontario and from Maui to Long Beach
  • Resumed certain international flights, between Hawaiʻi and French Polynesia, American Samoa, and Sydney, Australia
  • Participated in the Civil Reserve Air Fleet and deployed two wide-body aircraft to transport over 3,000 Afghan refugees between U.S. military bases

 

Guest experience

  • Eliminated change fees and announced no expiration of HawaiianMiles rewards
  • Opened new airside concourse in Honolulu (HNL) and moved to a new terminal in Los Angeles (LAX) offering improved experiences for our guests and employees
  • Announced intent to implement the Amadeus Altea software suite
  • Participated in the State of Hawaiʻi’s preclearance program to expedite guests through the State’s COVID-19 arrival protocols

Fleet and financing

  • Extended leases for two A330-200 aircraft and amended leases for two other A330-200 aircraft, reducing monthly rent payments
  • Raised a total of $1.6 billion in capital through a loyalty program financing, an at-the-market equity offering of common stock and participation in federal Payroll Support Programs
  • Repaid approximately $440.9 million in future debt obligations

 

Environmental, Social and Corporate Governance

  • Participated in the International Air Transport Association Annual General Meeting, and furthered the Company’s commitment to achieve net-zero carbon emissions by 2050
  • Published second annual Corporate Kuleana Report outlining progress in advancing various environmental, social and governance (ESG) initiatives
  • Pledged to offset emissions from international flights above 2019 levels in accordance with the International Civil Aviation Organization’s Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA)

 

First Quarter 2022 Outlook

The table below summarizes the Company’s expectations for the quarter ending March 31, 2022 expressed as an expected percentage change compared to the results for the quarter ended March 31, 2019.

 

Item   First Quarter 2022 Guidance   GAAP Equivalent   GAAP First Quarter 2022 Guidance
ASMs   Down 10% to 13%        
Total Revenue   Down 31% to 35%        
Costs per ASM, excluding fuel and non-recurring items (a)   Up 10% to 13%   Costs per ASM (a)   Up 11.7% to 14.2%
Gallons of Jet Fuel Consumed   Down 18% to 21%        
Fuel Price per Gallon (b)   $2.53        
Adjusted EBITDA (c)   $(150) million to $(90) million   Net Income (c)    
Effective Tax Rate   ~21%        

 

Full Year 2022 Outlook

The Company is providing an update to its outlook for the full year 2022 based on changes since its prior outlook filed on Form 8-K with the Securities and Exchange Commission on December 13, 2021. The table below summarizes the Company’s expectations for the full year ending December 31, 2022 expressed as an expected percentage change compared to the results for the year ended December 31, 2019. Costs per ASM excludes any adjustments for labor agreements that are currently amendable or become amendable in 2022.

 

Item   Updated Guidance   Prior Guidance   GAAP Equivalent, Updated Guidance   GAAP Equivalent, Prior Guidance
ASMs   Down 3% to up 1%   Flat to up 4%        
Costs per ASM excluding fuel and non-recurring items (a)   Up 3.5% to 7.5%   Up 2% to 6%   Cost per ASM (a) Up 5.8% to 9.0%   Cost per ASM (a) Up 1.5% to 5.5%
Gallons of Jet Fuel Consumed   Down 4.5% to 8.5%   Up 0.5% to down 3.5%        
Fuel Price per Gallon (b)   $2.42   $2.09        
Capital Expenditures   $105M To $125M   $365M to $385M        

 

The Company’s estimates for its costs per ASM excluding fuel and non-recurring items for the quarter ending March 31, 2022 and full year ending December 31, 2022, exclude any cost assumptions for the tentative agreements reached with the International Association of Machinists and Aerospace Workers (IAM).  When the agreement with the IAM is ratified, the Company expects a 1 to 1.5 point increase in its costs per ASM excluding fuel and non-recurring for the full year ending December 31, 2022 as compared to the year ended December 31, 2019.

 

(a) See Table under “Non-GAAP Reconciliation” for a reconciliation of GAAP costs per ASM to costs per ASM excluding fuel and non-recurring items.

(b) Fuel Price per Gallon estimates are based on the January 20, 2022 fuel forward curve.

(c) The Company is not providing a reconciliation of adjusted EBITDA to GAAP net income, the most directly comparable GAAP measure, as it is unable, without unreasonable efforts, to calculate certain special and non-recurring charges, which could have a significant impact on the GAAP measure.

Statistical information, as well as a reconciliation of certain non-GAAP financial measures, can be found in the accompanying tables.

Top Copyright Photo: Hawaiian Airlines Airbus A321-271N WL N213HA (msn 8237) LAS (Keith Sommer). Image: 956582.

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