Frontier Airlines today announced it has resumed codesharing with the Mexico City-based airline Volaris.
Frontier and Valaris are part of the Indigo Partners group.
Beginning today, Frontier customers will have the ability to book travel between the U.S. and Mexico through the codeshare for flights departing May 16, 2024, onward.
Photo: Volaris.
Volaris is the Mexican ultra low-cost airline that operates in Mexico, the United States, and Central and South America. Their flights in Mexico include popular destinations such as Mexico City, Cancún, Los Cabos, Puerto Vallarta, Huatulco, Acapulco, Guadalajara, Monterrey and Tijuana, among others.
Frontier Group Holdings, Inc., parent company of Frontier Airlines, Inc., today reported financial results for the first quarter of 2024 and issued guidance for the second quarter and full-year 2024.
First Quarter 2024 Summary:
Total operating revenues were $865 million, 2 percent higher than the comparable 2023 quarter, on capacity growth of 8 percent
Cost per available seat mile (“CASM”) was 9.49 cents, a reduction of 5 percent over the comparable 2023 quarter
Adjusted CASM (excluding fuel), a non-GAAP measure, was 6.71 cents, on a 9 percent shorter average stage length; adjusted CASM (excluding fuel) on a stage-adjusted basis to 1,000 miles, a non-GAAP measure, was 3 percent lower than the comparable 2023 quarter
Pre-tax loss and adjusted (non-GAAP) pre-tax loss were each $24 million; pre-tax margin and adjusted (non-GAAP) pre-tax margin were each (2.8) percent, reflecting better than expected cost and revenue performance
Took delivery of six A321neo aircraft during the first quarter, increasing the proportion of the fleet comprised of the more fuel-efficient A320neo family aircraft to 80 percent as of March 31, 2024, the highest of all major U.S. carriers
Generated 105 available seat miles (“ASM”) per gallon, a 2 percent improvement compared to the corresponding 2023 quarter, reaffirming Frontier’s position as “America’s Greenest Airline” as measured by fuel efficiency (ASMs per fuel gallon consumed during the first quarter; compared to all other major U.S. carriers)
As part of the strategy to diversify revenue and provide additional premium options, the Company launched BizFare, a new program designed to help companies save money on business travel and deliver a convenient, rewarding experience, and UpFront Plus, a new upgraded seating option with extra space and comfort in the first two rows of the aircraft
Opened a 10th crew base in Cleveland, announced Frontier’s largest network expansion focused on high-fare, underserved markets and continued to trend as planned toward targeted levels of scheduled out-and-back flying by peak summer 2024
Launched a reimagined Frontier Miles loyalty program which contributed to the Frontier Airlines World Mastercard being recognized by Money.com as the best airline credit card for budget travel, citing its high reward rate and the fact that every dollar spent counts toward elite status
“Rigorous cost and revenue management contributed to first quarter results which exceeded expectations,” commented Barry Biffle, Chief Executive Officer. “We expect results in the balance of the year to build on the revenue and network enhancements we’re implementing, most notably the transition to underserved, high-fare markets, revenue diversification and cost savings, including benefits related to network simplification. I’m proud of Team Frontier for their extraordinary contributions and for their ongoing commitment to deliver Low Fares Done Right every day.”
First Quarter 2024 Select Financial Highlights
The following is a summary of first quarter select financial results, including both GAAP and adjusted (non-GAAP) metrics. Refer to “Reconciliations of Non-GAAP Financial Information” in the appendix of this release.
(unaudited, in millions, except for percentages and per share data)
Three Months Ended March 31,
2024
2023
As Reported (GAAP)
Adjusted (Non-GAAP)
As Reported (GAAP)
Adjusted (Non-GAAP)
Total operating revenues
$ 865
$ 865
$ 848
$ 848
Total operating expenses
$ 896
$ 896
$ 873
$ 872
Pre-tax income (loss)
$ (24)
$ (24)
$ (17)
$ (16)
Pre-tax margin
(2.8) %
(2.8) %
(2.0) %
(1.9) %
Net income (loss)
$ (26)
$ (21)
$ (13)
$ (12)
Diluted earnings (loss) per share
$ (0.12)
$ (0.09)
$ (0.06)
$ (0.06)
Revenue Performance
Total operating revenue for the first quarter of 2024 increased 2 percent to $865 million on capacity growth of 8 percent, both compared to the corresponding 2023 quarter, resulting in a revenue per available seat mile (“RASM”) of 9.16 cents, a reduction of 5 percent compared to the corresponding 2023 quarter. Departures increased 14 percent on a 9 percent shorter average stage length, and total revenue per passenger was $123.53, down 1 percent, all compared to the corresponding 2023 quarter. The decline in RASM from 9.67 cents in the 2023 quarter was driven by a decrease in flown load factor from 83 percent to 73 percent, associated with the Company’s focus on maximizing total revenue, with passenger mile yields in the first quarter of 2024 increasing to 12.6 cents compared to 11.7 cents in the corresponding 2023 quarter.
Cost Performance
Total operating expenses for the first quarter of 2024 were $896 million, including $263 million of fuel expenses at an average cost of $2.93 per gallon. Adjusted total operating expenses (excluding fuel), a non-GAAP measure, were $633 million, approximately 3 percent below the midpoint of guidance due primarily to better-than-expected cost performance across the organization.
CASM was 9.49 cents in the first quarter of 2024, 5 percent lower than the comparable 2023 quarter. CASM (excluding fuel), a non-GAAP measure, was 6.71 cents, 1 percent higher than the 2023 quarter. Adjusted CASM (excluding fuel) stage-length adjusted to 1,000 miles, a non-GAAP measure, was 3 percent lower than the comparable 2023 quarter due primarily to three additional sale-leaseback transactions in the quarter along with aggressive cost management across the organization that helped mitigate year over year inflationary impacts.
Earnings
Pre-tax loss for the first quarter of 2024 was $24 million, reflecting a pre-tax margin of (2.8) percent.
Net loss for the first quarter of 2024 was $26 million, inclusive of a $5 million non-cash valuation allowance against deferred tax assets largely related to the pre-tax losses generated during the quarter. This allowance is not expected to affect the Company’s ability to utilize cumulative net operating losses against future potential income tax liabilities. Excluding this item, adjusted (non-GAAP) net loss was $21 million.
Cash and Liquidity
Unrestricted cash and cash equivalents as of March 31, 2024 was $622 million, $13 million higher than year-end 2023.
Fleet
As of March 31, 2024, Frontier had a fleet of 142 Airbus single-aisle aircraft, as scheduled below, all financed through operating leases that expire between 2025 and 2036.
Equipment
Quantity
Seats
A320neo
82
186
A320ceo
8
180 – 186
A321ceo
21
230
A321neo
31
240
Total fleet
142
Frontier is “America’s Greenest Airline” as measured by fuel efficiency (ASMs per fuel gallon consumed during the first quarter; compared to all other major U.S. carriers). During the first quarter of 2024, Frontier generated 105 ASMs per gallon, a 2 percent improvement compared to the corresponding 2023 quarter.
Frontier took delivery of six A321neo aircraft during the first quarter of 2024, increasing the proportion of the fleet comprised of the more fuel-efficient A320neo family aircraft to 80 percent as of March 31, 2024, the highest of all major U.S. carriers. The A321neo is expected to unlock meaningful scale efficiencies by way of fuel savings and higher average seats per departure. As of March 31, 2024, the Company had commitments for an additional 204 aircraft to be delivered through 2029, including purchase commitments for 67 A320neo aircraft and 137 A321neo aircraft, the latter of which represents 67 percent of future committed deliveries.
New, Upgraded FRONTIER MILES℠ Frequent Flyer Program
In January 2024, the Company officially launched its reimagined FRONTIER Miles℠ loyalty program allowing consumers to “Get It All For Less.” The new program enables consumers to earn Travel Miles and Elite Status Points fast and get rewarded for each dollar spent with the Frontier Airlines World Mastercard with the highest earn rate on total eligible purchases in the industry, at up to 20 miles or points per dollar spent for completed flights.
Travel Miles and Elite Status Points now accrue based on dollars spent on Frontier eligible products, including flights, bags, seat assignments, and bundles, with a standard 10x multiplier such that $1 of spend earns 10 miles. Mileage multipliers increase at every status level up to 20x.
The enhancements to the credit card earned a distinction from a leading personal finance publication. In March 2024, Money.com recognized the Frontier Airlines World Mastercard as being the best airline credit card for budget travel, citing its high reward rate and the fact that every dollar spent counts toward elite status.
Frontier Airlines will launch nonstop service from various airports across the U.S. in June and July of 2024, to destinations spanning the East Coast to West Coast and Pacific Northwest to the Southeast.
New service from Buffalo Niagara International Airport (BUF):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
FARE:
Philadelphia (PHL)
June 6, 2024
3x/week
$19*
New service from Denver International Airport (DEN):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
FARE:
Savannah (SAV)
June 13, 2024
3x/week
$49*
New service from Dallas Fort Worth International Airport (DFW):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
FARE:
Sacramento (SMF)
June 13, 2024
4x/week
$59*
St. Louis (STL)
June 14, 2024
3x/week
$19*
Seattle (SEA)
June 14, 2024
4x/week
$49*
New service from Ontario International Airport (ONT):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
FARE:
Sacramento (SMF)
July 11, 2024
Daily
$19*
New service from Chicago O’Hare International Airport (ORD):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
FARE:
Salt Lake City (SLC)
June 14, 2024
3x/week
$59*
New service from Norfolk International Airport (ORF):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
INTRO FARE:
Philadelphia (PHL)
June 5, 2024
3x/week
$19*
New service from Philadelphia International Airport (PHL):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
INTRO FARE:
Buffalo (BUF)
June 6, 2024
3x/week
$19*
Norfolk (ORF)
June 5, 2024
3x/week
$19*
Service from Savannah/Hilton Head International Airport (SAV):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
INTRO FARE:
Denver (DEN)
June 13, 2024
3x/week
$49*
Service from Seattle-Tacoma International Airport (SEA):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
INTRO FARE:
Dallas (DFW)
June 14, 2024
4x/week
$49*
Service from Salt Lake City International Airport (SLC):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
INTRO FARE:
Chicago O’Hare (ORD)
June 14, 2024
3x/week
$59*
New service from Sacramento International Airport (SMF):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
INTRO FARE:
Dallas (DFW)
June 13, 2024
4x/week
$59*
Ontario (ONT)
July 11, 2024
Daily
$19*
Service from St. Louis Lambert International Airport (STL):
Indigo Partners LLC has advised Frontier Group Holdings, Inc., parent company of Frontier Airlines, Inc., that it will distribute the shares of Frontier common stock owned by an affiliated investment fund to its members, including William A. Franke, Chair of the Frontier Board of Directors, and Indigo Partners investors, including George Roberts and an investment fund advised by Wildcat Capital Management, an investment advisor to a number of clients, including David Bonderman. The pro-rata, in-kind distribution is pursuant to the dissolution of the investment fund managed by Indigo established to acquire the Company in late 2013, which had a term of 10 years.
Indigo currently holds 178,834,034 shares of common stock of Frontier, representing approximately 80% of the shares outstanding1. As part of the distribution, approximately 99.4 million shares, representing approximately 44% of shares outstanding, will be distributed to Mr. Franke, or entities directly or indirectly controlled by him. Indigo intends to distribute the shares pro-rata to its investors unaffiliated with Mr. Franke on or around April 1, 2024.
Upon the effectiveness of the share distribution, the Company will no longer be a “controlled company” under the applicable rules of the Nasdaq Stock Market, LLC.
Accordingly, the Company will make certain corporate governance changes following permitted phase-in periods. Among other things, the Company will be required to have a compensation committee consisting solely of independent directors, and a director nominations process whereby directors are selected by a nominations committee consisting solely of independent directors or by a vote of the Board of Directors in which only independent directors participate.
As a result, William A. Franke has resigned from the Company’s Nominating and Corporate Governance Committee. Mr. Franke will remain a director and the Chair of the Board.
Indigo Partners LLC is a private equity firm established by W. A. Franke in 2003 to pursue acquisitions and strategic investments in the air transportation and related industries. The firm was a lead investor in Tiger Airways based in Singapore and Spirit Airlines based in Ft. Lauderdale, Florida, and maintains lead investments in Wizz Air Holdings, Plc, a ULCC with multiple bases in Central and Eastern Europe; Frontier Airlines, a ULCC based in Denver; Volaris Airlines, a ULCC based in Mexico City; Cebu Pacific, a ULCC based in the Philippines; and JetSMART, a ULCC based in Chile. Indigo is headquartered in Phoenix, Arizona.
Frontier Airlines will launch nonstop service on several new routes in May and June.
One to two times daily service from Newark to San Juan will mark the airline’s return to Newark after two years, and twice daily service from New York-JFK airport to San Juan will launch Frontier’s first operation from JFK.
New service from Phoenix to Los Cabos will be the first international route the airline has operated from Phoenix. This latest group of route announcements also includes service between John Wayne Airport in Orange County, Calif., and San Francisco.
New Service from Newark Liberty International Airport (EWR):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
INTRO FARE:
San Juan (SJU)
June 27, 2024
11x/week
$59*
New Service from John F. Kennedy International Airport (JFK):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
INTRO FARE:
San Juan (SJU)
June 6, 2024
2x/daily
$59*
New Service from San Juan (SJU):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
INTRO FARE:
New York (JFK)
June 6, 2024
2x/daily
$59*
Newark (EWR)
June 27, 2024
11x/week
$59*
New Service from Phoenix Sky Harbor International Airport (PHX):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
INTRO FARE:
Los Cabos (SJD)***
May 16, 2024
2x/week
$89**
New Service from John Wayne Airport (SNA):
SERVICE TO:
SERVICE START:
SERVICE FREQUENCY:
INTRO FARE:
San Francisco
July 11, 2024
4x/week
$19**
New service from San Francisco International Airport:
Frontier Airlines is celebrating the opening of a new crew base at Cleveland Hopkins International Airport.
Frontier Airlines representatives, along with Cleveland Director of Port Control Bryant L. Francis, C.M., and Bonnie Teeuwen, Chief Operating Officer, City of Cleveland, participated in a ribbon-cutting ceremony to mark the occasion.
The base is expected to employ up to 110 pilots, 250 flight attendants and 50 aircraft maintenance personnel within its first year of operation. Combined with airport positions, the airline is expected to generate nearly $80 million annually in local wages with further growth anticipated in the coming years.
With service on 10 additional routes announced last month, the airline will serve 30 destinations in total from Cleveland by summer, increasing Frontier’s average peak summer daily departures by 38 percent versus a year ago.
Frontier Airlines today announced the introduction of UpFront Plus, a new upgraded seating option with extra space and comfort in the first two rows of the aircraft. Customers in UpFront Plus will enjoy a window or aisle seat with extra legroom and a guaranteed empty middle seat, providing additional personal space and comfort at an exceptional value.
Starting today, customers can upgrade to UpFront Plus seating for flights departing on or after April 10, 2024, by reserving seats on the Frontier mobile app or at FlyFrontier.com. As a special introductory offer, UpFront Plus seating upgrades will be available starting at only $49 per passenger, per flight segment for travel between April 10 and April 30, 2024, when purchased by March 20, 2024*. Seats are limited and restrictions apply.
UpFront Plus will be one of four seat options available on Frontier flights:
· UpFront Plus
o Blocked middle seat: more elbow room
o Extra legroom & comfort
o Quick exit, with seats located in the first two rows of the aircraft
o First to get inflight service
· Premium
o Extra legroom and comfort
· Preferred
o Quick exit, with seats located towards the front of the aircraft
· Standard
*About the Introductory Offer
Subject to availability at FlyFrontier.com and through the Frontier mobile app. Price available through 11:59 p.m. Eastern Time on March 20, 2024, for travel dates from April 10, 2024, through April 30, 2024. Prices shown are per person, per flight segment. Seats are limited. Restrictions apply.
Frontier Airlines will begin nonstop service from Cleveland Hopkins International Airport (CLE) to 10 additional destinations in May of 2024. These routes are in addition to service announced last month from CLE to Minneapolis-Saint Paul and New York LaGuardia. With the new routes, Frontier will serve a total of 30 destinations from CLE, increasing average peak summer daily departures by 38 percent versus a year ago.
Service from Cleveland Hopkins International Airport (CLE):
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