Category Archives: Hawaiian Airlines

Hawaiian Holdings reports 2018 third quarter financial results, down to 5 767s

Hawaiian Airlines Boeing 767-3CB ER WL N588HA (msn 33466) LAX (Ron Monroe). Image: 944044.

Hawaiian Holdings, Inc., parent company of Hawaiian Airlines, Inc., today reported its financial results for the third quarter of 2018.

Third Quarter 2018 – Key Financial Metrics

GAAP

YoY Change

Adjusted

YoY Change

Net Income

$93.5M

+$21.9M

$96.7M

$(3.0)M

Diluted EPS

$1.84

+$0.50

$1.91

+$0.05

Pre-tax Margin

15.4%

(0.6) pts.

15.9%

(6.3) pts.

(PRNewsfoto/Hawaiian Holdings, Inc.)

“Through back-to-back hurricanes in Hawai’i and a typhoon in Japan, my colleagues minimized disruptions to operations, kept our guests safe, and supported community relief efforts all while delivering our authentic Hawaiian hospitality that is unmatched in the industry,” said Peter Ingram, Hawaiian Airlines president and CEO.  “Our healthy financial and operational performance in this eventful quarter once again demonstrated that the Hawaiian team is second to none.”

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

Shareholder Returns, Liquidity and Capital Resources

The Company returned $37.3 million to shareholders in the third quarter through $31.2 million in shares repurchased and $6.1 million in dividends paid.

On October 19, 2018 the Company’s Board of Directors declared a quarterly cash dividend of 12 cents per share to be paid on November 30, 2018 to all shareholders of record as of November 16, 2018.

As of September 30, 2018, the Company had:

  • Unrestricted cash, cash equivalents and short-term investments of $591 million
  • Outstanding debt and capital lease obligations of $718 million

Third Quarter 2018 Highlights

Commercial

  • Expanded its cargo services with the launch of its All-Cargo Neighbor Island service between Honolulu’s Daniel K. Inouye International Airport (HNL), Lihu’e Airport (LIH) and Hilo International Airport (ITO).  The All-Cargo service, which currently consists of two ATR-72 aircraft, is expected to expand in 2019 with the addition of flights between Honolulu (HNL) and Maui’s Kahului Airport (OGG) and Hawai’i Island’s Kona International Airport (KOA).

Operational

  • Carried more than 3 million guests across its network, a record for the third quarter.

Partnerships

  • Enhanced its comprehensive partnership with Japan Airlines with the implementation of reciprocal frequent flyer benefits for HawaiianMiles and JAL Mileage Bank members effective October 2018.  The enhanced program is the second phase of the comprehensive partnership launched in March 2018 with codeshare flights.

New Routes

  • Announced its second East Coast route with new five-times-a-week non-stop service between Boston’s Logan International Airport (BOS) and Honolulu (HNL) beginning April 2019.

Copyright Photo: Michael Carter.

Fleet and Financing

  • Took delivery of three Airbus A321neo aircraft between July and August, increasing the size of its A321neo fleet to nine aircraft.
  • Retired two of its Boeing 767 aircraft in the third quarter as part of the planned exit from its 767 fleet.  Retired an additional 767 aircraft subsequent to quarter end, decreasing the size of its 767 fleet to five aircraft.
  • Completed a sale-leaseback transaction for one of its Airbus A330-200 aircraft.
  • Subsequent to quarter end, signed a definitive agreement with General Electric for the acquisition of GEnx engines to power its Boeing 787-9 fleet to be delivered starting in 2021.

Fourth Quarter and Full Year 2018 Outlook

The table below summarizes the Company’s expectations for the fourth quarter and full year ending December 31, 2018 expressed as an expected percentage change compared to the recast results for the quarter and year ended December 31, 2017, as applicable.

As a result of discretionary contributions to defined benefit and other postretirement plans made by the Company in the third quarter, and the resulting impact of the Tax Cuts and Jobs Act, the Company expects its effective tax rate for the full year ending December 31, 2018 to be in the range of 21 percent to 23 percent.

Top Copyright Photo: Hawaiian moves one step closer to the retirement of the Boeing 767-300 fleet, now down to five aircraft. Hawaiian Airlines Boeing 767-3CB ER WL N588HA (msn 33466) LAX (Ron Monroe). Image: 944044.

Hawaiian aircraft slide show:

x

Advertisements

Hawaiian Airlines to fly nonstop to Boston starting in April, becomes the longest domestic route

The first Airbus A330 in the new 2017 livery

Hawaiian Airlines will begin its five-day-a-week service on April 4, 2019 to Boston – more than a week before Patriots’ Day on April 15, 2019.

Boston is the largest U.S. market without nonstop service to Hawai’i with nearly 500 people flying between eastern New England and the islands on any given day. This new route adds to Hawaiian Airlines’ global network. The market between Boston Logan International (BOS) and Honolulu’s Daniel K. Inouye International (HNL) airports last year generated about $76 million in ticket sales.

In commemoration of the city of Boston’s deep history and Hawaiian Airlines’ 90th year of operation starting on November 11, the flight to Boston will be numbered Flight HA90. Starting with the inaugural flight on April 4, 2019 HA90 will depart HNL every day but Tuesday and Wednesday at 1:45 p.m. and arrive at BOS the following morning at 6 a.m. Flight HA91 will depart BOS every day but Wednesday and Thursday at 8:55 a.m., except for Friday flights, which will depart at 8 a.m. The flights will arrive in Hawai’i the same day at 2:35 p.m. and the Friday flight will arrive at 1:40 p.m. Both HNL arrival times offer guests ample time to settle into their accommodations and unwind with a Hawaiian sunset, or connect to Kaua’i, Maui or the Island of Hawai’i via the airline’s convenient schedule of some 170 daily interisland jet flights.

At 5,095 miles, Hawaiian’s BOS-HNL route becomes the longest regularly scheduled domestic route in U.S. history.

New Englanders traveling from the East Coast to Hawai’i’s shores will enjoy the roominess and superior comfort of Hawaiian’s Airbus A330 widebody aircraft.

Incorporating flowing curves evocative of the winds and the ocean, Hawaiian’s spacious first class cabin features 18 lie-flat leather seats that transform into 180-degree beds at a roomy 20.5 inches wide and 76 inches long. Aligned in a 2-2-2 configuration, the seats are ideally tailored to leisure guests such as couples, families and honeymooners, while offering functionality to the business traveler.

Hawaiian also recently expanded to 68 from 40 the number of Extra Comfort main cabin seats, which offer a generous 36-inch pitch for extra leg room, and priority boarding. Guests can upgrade to Extra Comfort seats for $145 each way.

Top Copyright Photo (all others by Hawaiian): Hawaiian Airlines Airbus A330-243 F-WWCH (N361HA) (msn 1823) TLS (Eurospot). Image: 939213.

Hawaiian aircraft slide show:

x

Hawaiian Airlines updates expected third quarter and full year 2018 metrics

Delivered on June 15, 2018

Hawaiian Airlines, Inc., a subsidiary of Hawaiian Holdings, Inc., has updated its expectations for certain third quarter and full year 2018 financial metrics.

Third Quarter 2018 Outlook

The Company has revised certain of its expectations for the third quarter ending September 30, 2018that were previously provided on July 24, 2018.

Specifically, the Company lowered its expectations for third quarter operating revenue per available seat mile (RASM) as a result of service disruptions, passenger cancellations and booking interruptions stemming from Hurricane Lane that affected the Hawaiian island chain in late August 2018.

The table below summarizes the Company’s revised expectations, expressed as an expected percentage change compared to the results for the third quarter ended September 30, 2017.

Prior Third Quarter

2018 Guidance

Revised Third Quarter
2018 Guidance

Operating revenue per ASM (RASM)

Down 1.5% – Up 1.5%

Flat – Down 2.0%

Full Year 2018 Outlook

The Company has also revised certain of its expectations for the full year ending December 31, 2018that were previously provided on July 24, 2018.

Specifically, the Company lowered its expectations for full year ASMs and gallons of jet fuel consumed following the planned suspension of its thrice-weekly nonstop service between Honolulu’s Daniel K. Inouye International Airport (HNL) and Beijing Capital International Airport (PEK) effective mid-October 2018.

The Company’s expectations for full year operating costs per ASM (CASM) excluding aircraft fuel and special items remain unchanged.

The table below summarizes the Company’s revised expectations, expressed as an expected percentage change compared to the results for the year ended December 31, 2017.

Prior Full Year 2018
Guidance

Revised Full Year 2018
Guidance

Available seat miles (ASMs)

Up 5.5 – 7.5%

Up 5.0 – 7.0%

Gallons of jet fuel consumed (000s)

Up 4.0 – 6.0%

Up 3.5 – 5.5%

Copyright Photo: Hawaiian Airlines Airbus A321-271N WL N212HA (msn 8129) LGB (Michael B. Ing). Image: 943083.

Hawaiian aircraft slide show:

x

Hawaiian Airlines to end service to Beijing

"Keoe", now with Raiders logo for 2018 NFL season (official airline)

Hawaiian Airlines will drop the Honolulu – Beijing route on October 12, 2018.

The route is currently operated three days a week with Airbus A330-200s according to Airline Route.

Top Copyright Photo: Hawaiian Airlines Airbus A330-243 N396HA (msn 1488) (Raiders) SEA (Bruce Drum). Image: 104738.

Hawaiian Airlines aircraft slide show:

Route Map (Western Pacific):

Hawaiian Airlines launches all-cargo island service

Hawaiian Airlines on August 13, 2018 celebrated the launch of all-cargo service between Honolulu’s Daniel K. Inouye International Airport (HNL), Līhu‘e Airport (LIH) and Hilo International Airport (ITO) by transporting construction and household supplies to support disaster relief projects in Hanalei on Kaua‘i and Puna on the Island of Hawai‘i.

Hawaiian’s new ATR 72 aircraft was loaded with 1,020 pounds of construction tools bound for Līhu‘e to be used by Kaua‘i Habitat for Humanity in repairing homes for low-income residents affected by last April’s devastating storms. A second flight to Hilo carried 1,815 pounds of furniture for 20 micro-houses built by HOPE Services Hawai‘i to shelter families affected by the ongoing Kīlauea volcano lava flow. The items were packed by employees at City Mill, which augmented Hawaiian’s list with its own donations. Also aboard the flight from Honolulu to Hilo were 23 boxes of school supplies collected by Hawaiian employees and being delivered to Pāhoa Elementary.

The pictured N810HC below made the first revenue flight.

Cargo operations launched on August 13, 2018 with N810HC

Above Copyright Photo (all others by Hawaiian): Ohana by Hawaiian-Empire Airlines ATR 72-212 (F) N810HC (msn 423) HNL (Ivan K. Nishimura). Image: 943082.

The Līhu‘e shipment expands Hawaiian’s partnership with Kaua‘i Habitat for Humanity, established with an initial $25,000 cash donation after torrential storms displaced residents on Kaua‘i earlier this spring. The new partnership with HOPE Services Hawai‘i builds on Hawaiian’s earlier contribution of $50,000 to support the Salvation Army’s emergency shelters set up in Puna in the wake of Kīlauea’s recent eruption.

New Cargo Operation

Hawaiian’s new cargo fleet, consisting of two ATR 72 aircraft (N810HC and N811HC) in an all-cargo configuration, offers customers efficient shipment of goods throughout the state with well-timed connections from the airline’s mainland and international networks. The ‘Ohana by Hawaiian freighter operation will also include flights between HNL and Kahului Airport (OGG) and Kona International Airport (KOA) with the arrival of two more aircraft expected to be in service next year.

Hawaiian’s ATR 72s can also accommodate up to seven LD-3 containers, the same type carried by aircraft flying Hawaiian’s transpacific routes, allowing the airline to transfer cargo more seamlessly between the islands and destinations in Asia, the South Pacific and the U.S. mainland.

The cargo fleet is operated by Empire Airlines, which also operates ‘Ohana by Hawaiian’s four 48-passenger ATR 42 fleet serving the communities of Kapalua (Maui), Moloka‘i and Lāna‘i. 

The new ATR 72 service complements bulk freight and containerized shipping Hawaiian provides on over 70 scheduled transpacific daily flights with Airbus A330 and A321neo, and Boeing 767 aircraft. The airline’s Boeing 717 fleet, which flies approximately 170 daily flights between the Neighbor Islands, will continue to provide express shipments throughout the state.

Hawaiian Airlines became the first U.S. carrier to obtain a cargo certificate on March 20, 1942, when it converted amphibious Sikorsky S-38s into cargo aircraft to transport beef from Moloka‘i to Honolulu, while using S-43s as freighters servicing other islands. Hawaiian has provided transpacific shipping for over 75 years.

Photos: Hawaiian Airlines.

Ohana aircraft slide show:

https://airlinersgallery.smugmug.com/frame/slideshow?key=sLD3rQ&autoStart=1&captions=1&navigation=1&playButton=1&randomize=1&speed=3&transition=fade&transitionSpeed=2

https://airlinersgallery.smugmug.com/frame/slideshow?key=sLD3rQ&autoStart=1&captions=1&navigation=1&playButton=1&randomize=1&speed=3&transition=fade&transitionSpeed=2“>

Hawaiian Holdings reports 2018 second quarter financial results

Delivered on June 30, 2018

Hawaiian Holdings, Inc., parent company of Hawaiian Airlines, Inc., today reported its financial results for the second quarter of 2018.

Second Quarter 2018 – Key Financial Metrics

GAAP

YoY Change

Adjusted

YoY Change

Net Income

$79.5M

+$2.6M

$73.3M

$(8.4)M

Diluted EPS

$1.56

+$0.13

$1.44

$(0.08)

Pre-tax Margin

14.8%

(3.7) pts.

13.7%

(5.9) pts.

“Our second quarter performance reflects our continued position as the carrier of choice for Hawai’i,” said Peter Ingram, Hawaiian Airlines president and CEO.  “The Hawaiian team showed their mettle yet again, producing solid financial and operational results in a quarter marked by rising fuel prices, elevated industry capacity, and headline-grabbing volcanic activity on the Big Island of Hawai’i.  We generated more revenue and carried more guests than in any second quarter in our history by executing our plan and running a safe and reliable airline.  I couldn’t be more proud of my colleagues.”

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

Shareholder Returns, Liquidity and Capital Resources

As of June 30, 2018, the Company had:

  • Unrestricted cash, cash equivalents and short-term investments of $593 million
  • Outstanding debt and capital lease obligations of $692 million

The Company returned $8.6 million to shareholders in the second quarter through $6.1 million in dividends and $2.5 million in share repurchases.

On July 20, 2018, the Company’s Board of Directors declared a quarterly cash dividend of 12 cents per share to be paid on August 31, 2018, to all shareholders of record as of August 17, 2018.

Second Quarter 2018 Highlights

Operational

  • Carried more than 3 million guests across its network, a record for the second quarter.

Partnerships

  • Together with Japan Airlines, filed an application with the U.S. Department of Transportation (DOT) and Japan’s Ministry of Land, Infrastructure, Transport and Tourism (MLIT) seeking antitrust immunity to create a joint venture that promises significant consumer benefits and the opportunity for service expansion.  The antitrust immunized joint venture will build upon the broad codeshare partnership the two carriers initiated in March 2018.

New Routes and increased frequencies

  • Expanded its routes to Southern California with the launch of new daily non-stop service between Long Beach Airport (LGB) and Honolulu’s Daniel K. Inouye International Airport (HNL).
  • Announced expanded seasonal winter service to International destinations, including:
    • increasing non-stop service between Seoul’s Incheon International Airport (ICN) and Honolulu (HNL) to daily flights between mid-January and early-February 2019; and
    • increasing non-stop service between Sapporo’s New Chitose Airport (CTS) and Honolulu (HNL) with up to five weekly flights during the first half of February 2019.
  • Announced expanded service to Northern California with new daily non-stop flights between Sacramento International Airport (SMF) and Maui’s Kahului Airport (OGG) beginning April 2019.

Product and Loyalty

  • Completed remodeling its Airbus A330 fleet with lie-flat premium seats and increased Extra Comfort capacity.
  • Together with Barclays, Mastercard, and Bank of Hawai’i, launched an enhanced Hawaiian Airlines World Elite Mastercard and Hawaiian Airlines Business Mastercard that allow cardmembers to earn more miles faster and embark on their next vacation sooner through a refreshed rewards structure.

Fleet and Financing

  • Subsequent to quarter end, secured its next long-haul aircraft with the signing of a definitive purchase agreement with Boeing for the purchase of 10 Boeing 787-9 aircraft (below), including purchase rights for an additional 10 aircraft.
  • Took delivery of four Airbus A321neo aircraft between May and June (top), increasing the size of its Airbus A321neo fleet to six aircraft.
  • Took delivery of one ATR 42 turboprop aircraft in June, increasing the size of its passenger turboprop fleet to four aircraft.
  • Entered into two Japanese Yen-denominated debt financings, each collateralized by an Airbus A321neo aircraft.

Third Quarter and Full Year 2018 Outlook

The table below summarizes the Company’s expectations for the third quarter ending September 30, 2018, and the full year ending December 31, 2018, expressed as an expected percentage change compared to the recast results for the quarter ended September 30, 2017, or the full year ended December 31, 2017, as applicable.

For the full year ending December 31, 2018, the Company expects its effective tax rate to be in the range of 24% to 26%.

Third Quarter

GAAP Third Quarter

Item

2018 Guidance

GAAP Equivalent

2018 Guidance

ASMs

Up 7.5 – 9.5%

Operating revenue per ASM

Down 1.5% – Up 1.5%

Cost per ASM excluding fuel and special items (a)

Up 0.5 – 3.5%

Cost per ASM (a)

Up 6.8 – 10.3%

Gallons of jet fuel consumed

Up 5.0 – 7.0%

Economic fuel cost per gallon (b)(c)

$2.10 – $2.20

Fuel cost per gallon (b)

$2.21 – $2.31

Full Year

GAAP Full Year

Item

2018 Guidance

GAAP Equivalent

2018 Guidance

ASMs

Up 5.5 – 7.5%

Cost per ASM excluding fuel and special items (a)

Up 1.0 – 3.0%

Cost per ASM (a)

Up 6.3 – 9.0%

Gallons of jet fuel consumed

Up 4.0 – 6.0%

Economic fuel cost per gallon (b)(c)

$2.05 – $2.15

Fuel cost per gallon (b)

$2.15 – $2.25

(a)

See Table 4 for a reconciliation of GAAP operating expenses to operating expenses excluding aircraft fuel and special items.

(b)

Fuel cost per gallon estimates are based on the July 12, 2018, fuel forward curve.

(c)

See Table 3 for a reconciliation of GAAP fuel costs to economic fuel costs.

New Revenue Recognition Accounting Standard

As of January 1, 2018, the Company adopted Accounting Standards Codification (ASC) 606, Revenue from Contracts with Customers, which affects the Company’s accounting for frequent flyer mileage sales, passenger revenue, other operating revenue, and selling costs.  The prior periods presented have been recast to reflect adoption of these new standards.

For additional details on the impact of the adoption of the new standards, see the Company’s Annual Report on Form 10-K for the year ended December 31, 2017, and the Company’s subsequent periodic filings beginning with its Quarterly Report on Form 10-Q for the quarter ended March 31, 2018.

Top Copyright Photo (all others by Hawaiian): Hawaiian Airlines Airbus A321-271N WL N209HA (msn 8186) LGB (Michael B. Ing). Image: 942911.

Hawaiian Airlines aircraft slide show:

Boeing, Hawaiian Airlines finalize order for up to 20 787 Dreamliners

Boeing and Hawaiian Airlines announced the companies finalized an order yesterday for 10 787-9 Dreamliners, valued at $2.82 billion at list prices. The deal also includes purchase rights for 10 additional 787s.

Hawaiian announced in March that it had selected the 787-9 Dreamliner to serve medium to long-haul routes, signing a letter of intent for the aircraft.

The 787-9 is the longest-range Dreamliner with the ability to fly up to 7,635 nautical miles (14,140 kilometers) with 290 passengers in a standard two-class configuration, while using 20 percent less fuel than older generation aircraft.

Boeing Global Services will provide Hawaiian Airlines with new aircraft transition support services – such as Training and Initial Provisioning – to ensure a smooth changeover from previous widebody aircraft.

This order extends the sale success of the 787, which is the fastest selling twin-aisle airplane in history with nearly 1,400 sold and more than 700 delivered.

Since entering service in 2011, the 787 family has flown more 255 million passengers while saving an estimated 25 billion pounds of fuel. The 787’s superior range and efficiency have enabled airlines to launch more than 180 new nonstop routes around the world.

Image: Boeing.