Category Archives: Hawaiian Airlines

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

Hawaiian Airlines updates expected third quarter and full year 2018 metrics

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%

Hawaiian aircraft slide show:

Hawaiian Airlines to end service to Beijing

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.

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:

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Hawaiian Holdings reports 2018 second quarter financial results

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.

Hawaiian Airlines to add daily Sacramento-Maui service

Hawaiian Airlines today announced it will begin daily nonstop flights between Sacramento (SMF) and Kahului, Maui (OGG) next year, offering convenient, direct access to the Valley Isle on the airline’s new Airbus A321neo from California’s capital city.

Sacramento-Maui schedule:

FLIGHT	ROUTE	DEPARTS	ARRIVES	START DATE
HA59	SMF-OGG	8:30 a.m.	11:15 a.m.	April 2, 2019
HA60	OGG-SMF	12:45 p.m.	8:55 p.m.	April 1, 2019

Hawaiian, Hawai’i’s largest and longest-serving carrier, launched its Sacramento–Honolulu service in June 2002. The carrier currently operates four Airbus A321neos on the following routes: Portland and Honolulu and Kahului, Maui; San Diego and Kahului, Maui; and Long Beach and Honolulu.

The highly efficient, mid-range A321neo aircraft complement Hawaiian’s fleet of wide-body aircraft currently used for service between Hawai’i and 12 U.S. gateway cities, along with 10 international destinations. Hawaiian’s 189-passenger A321neo includes 16 luxurious leather recliners in First Class, 44 Extra Comfort premium economy seats, and 129 Economy seats. In addition to Hawaiian’s warm hospitality, including complimentary meals, guests will enjoy wireless streaming in-flight entertainment, access to USB outlets, and additional overhead stowage space.