Category Archives: Hawaiian Airlines

Hawaiian reports second quarter adjusted net income of $37.5 million

Hawaiian Holdings, Inc, (Hawaiian Airlines) (Honolulu) has reported the financial results of its second quarter:

GAAP net income of $48.8 million or $0.79 per diluted share.
Adjusted net income, reflecting economic fuel expense and excluding loss on extinguishment of debt, of $37.5 million or $0.61 per diluted share, an increase of $15.1 million or $0.26 cents per diluted share year-over-year.
Adjusted pre-tax margin of 10.7% compared to 6.4% in the prior year period.
Unrestricted cash, cash equivalents and short-term investments of $606 million.
Lowered leverage ratio to 3.4x.

“We are pleased with the results for the quarter,” said Mark Dunkerley, Hawaiian Airlines president and chief executive officer. “Strong demand across our network, coupled with low fuel prices, more than compensated for the adverse impacts of the strengthening US dollar, the significant reduction in most fuel surcharges and the high levels of industry capacity growth from North America. Our financial performance for the second half of the year seems set to be a continuation of what we’ve seen so far in 2015. In this environment, the company expects to generate free cash flow, strengthen its balance sheet and improve its profit margins. As ever, the whole team has done a great job of looking after our customers, enhancing our reputation, and burnishing our brand. They have my thanks.”

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

Liquidity and Capital Resources

As of June 30, 2015 the Company had:

Unrestricted cash, cash equivalents and short-term investments of $606 million.
Outstanding debt and capital lease obligations of approximately $947 million consisting of the following:

$689 million outstanding under secured loan agreements to finance a portion of the purchase price for 11 Airbus A330-200 aircraft.
$127 million outstanding under secured loan agreements to finance a portion of the purchase price for 15 Boeing 717-200 aircraft.
$100 million in capital lease obligations to finance the acquisition of an Airbus A330-200, two Boeing 717-200 aircraft and aircraft-related equipment.
$27 million outstanding under floating rate notes to finance the acquisition of two Boeing 767-300 ER aircraft.
$4 million of outstanding convertible senior notes.

In the second quarter, the Company repurchased $4 million (principal balance) of its convertible senior notes outstanding. Repurchases to date have totaled $82 million (principal balance) or 95%, of the originally issued principal amount, thereby eliminating the need for the Company to issue 10.4 million shares when the notes may have otherwise converted to common stock.

In addition, during the second quarter the Company repurchased 0.8 million shares of its common stock for approximately $18 million under its previously announced $100 million stock repurchase program.

Second Quarter 2015 Highlights

Operational

Ranked #1 nationally for on-time performance for the months of March, April and May 2015.
Ranked as one of the top domestic airlines by Travel + Leisure for 2015.

Product and loyalty

The comprehensive interior retrofit of the Company’s neighbor island fleet remains on schedule for completion in the fourth quarter of 2015 with 12 of 18 Boeing 717 aircraft completed to date.

Fleet and financing

Added an A330-200 aircraft under lease financing and retired a Boeing 767-300 at the end of its lease.
Updated the fleet plan and entered into a six-year lease agreement for one A330-200 with a delivery date of summer 2016 and accelerated the planned retirement date of certain of its Boeing 767-300 aircraft.
Announced the purchase of three ATR 72 turbo-prop aircraft in an all-cargo configuration for expansion of its cargo service.

Schedule

Los Angeles to Kona, three-times-weekly, and Los Angeles to Lihu’e, four-times-weekly, summer seasonal service reintroduced in May.
Oakland to Kona, three-times-weekly and Oakland to Lihu’e, four-times-weekly, summer seasonal service reintroduced in May.
Los Angeles to Maui second daily seasonal summer service reintroduced in May.
Announced year round service from Los Angeles to Lihu’e, three-times-weekly, beginning in January 2016.

Read the full report: CLICK HERE

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Airbus A330-243 N396HA (msn 1488) taxies to the runway at Seattle-Tacoma International Airport (SEA).

Hawaiian Airlines aircraft slide show:

Hawaiian to acquire three ATR 72 freighters to operate under the ‘Ohana by Hawaiian brand

Hawaiian Holdings, Inc., parent of Hawaiian Airlines (Honolulu), today announced plans to acquire three ATR 72 turboprop aircraft in an all-cargo configuration to expand its interisland shipping services. The new operation will launch in the first half of 2016, starting with flights between Honolulu International Airport (HNL) and Kona International Airport (KOA), Kahului Airport (OGG), Līhuʻe Airport (LIH) and Hilo International Airport (ITO), with well-timed connections from Hawaiian Airlines’ mainland and international network.

The ATR 72 fleet can carry up to 18,000 pounds of cargo and will be able to handle five 88-by-108-feet aircraft pallets or up to seven LD3 containers, skidded cargo and oversized shipments. Express services for smaller shipments will also be available on its 160 daily B717 flights throughout the day.

The flights will be branded ‘Ohana by Hawaiian and operated by Empire Airlines, which also operates the 48-passenger ATR 42 turboprop service (above). The livery of the aircraft will feature the same kapa tail patterns created by Hilo-based artist Sig Zane and his son Kūha’o (below).

“Since launching the ‘Ohana by Hawaiian passenger operation in March 2014, we have established a track record of providing a reliable and efficient service for travel within the islands with an on-time arrival rate of 94 percent,” said Hadden Watt, managing director of ‘Ohana by Hawaiian. “We expect to deliver the same reliability and high-quality of service to our cargo customers for their interisland shipments.”

The new cargo operation will create more than 100 new Hawai’i-based jobs in various areas of air transportation including pilots, mechanics, ground handlers, sales, customer service and management positions.

Hawaiian Airlines was the first U.S. airline certified to ship cargo in 1942, and has provided high-quality overseas shipping and customer service to international customers, freight forwarders, carriers and many others in the industry for more than 70 years as the flagship carrier of the Pacific.

Top Copyright Photo: Ivan K. Nishimura/AirlinersGallery.com. Operated by Empire Airlines, ‘Ohana by Hawaiian-branded ATR 42-500 N804HC (msn 623) taxies at the Honolulu base.

Hawaiian aircraft slide show:

Videos:

Hawaiian Airlines is dropping service to Sendai, Japan

Hawaiian Airlines (Honolulu) on October 1 is dropping all service to Sendai, Japan. The airline is currently servicing the destination three days a week with Boeing 767-300 ERs per Airline Route.

Copyright Photo below: Brandon Farris/AirlinersGallery.com. Boeing 767-3CB ER N590HA (msn 33467) departs from Seattle-Tacoma International Airport (SEA).

Hawaiian Airlines aircraft slide show:

Hawaiian Airlines flight HA 24 returns to Maui with fumes in the cabin

Hawaiian Airlines (Honolulu) flight HA 24 departed Kahului on Maui at 11:18 a.m. yesterday (May 1) bound for Oakland. The flight crew declared an emergency and landed safely at Kahului Airport (OGG) at 11:50 a.m. after the smell of fumes was detected in the cabin according to MauiNow.com. The 224 passengers and 10 crew members safely evacuated the Boeing 767-300.

Hawaiian Airlines issued this short statement:

HA Flight 24 left Maui at 11:18 a.m. for Oakland, and returned to the Maui airport soon after departure due to an odor of fumes in the cabin. The flight crew declared an emergency and landed in OGG at 11:50 a.m. All customers were evacuated via emergency slides. There were 224 customers and 10 crew onboard. At this time there are no reports of serious injuries.

Read the full report: CLICK HERE

Hawaiian Airlines aircraft slide show:

Hawaiian Holdings produces record GAAP net income of $25.9 million for the first quarter

Hawaiian Holdings, Inc. (Honolulu), parent company of Hawaiian Airlines, Inc. (Honolulu), reported its financial results for the first quarter of 2015:

GAAP net income of $25.9 million or $0.40 per diluted share.

Adjusted net income, reflecting economic fuel expense and excluding loss on extinguishment of debt, of $24.7 million or $0.38 per diluted share, an increase of $25.6 million or $0.40 cents per diluted share year-over-year.

Adjusted pre-tax margin of 7.4% compared to (0.2)% in the prior year period.

Unrestricted cash, cash equivalents and short-term investments of $488 million.

Lowered leverage ratio to 3.6x.

The board of directors approved a share repurchase program authorizing the Company to buy back up to $100 million of its common stock.

“Producing these record results for the seasonally weak first quarter demonstrates the growing strength of our business,” said Mark Dunkerley, Hawaiian Airlines president and chief executive officer. “Low fuel prices and strong demand across our network combined to more than offset the impact of a strengthening U.S. dollar, declining fuel surcharges in some markets and an increase in industry capacity between North America and Hawai’i. Reflecting this performance we have announced a $100 million share repurchase program today. As always, our employees are at the forefront of our successes. Their performance makes our financial success possible and they have my undying thanks.”

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

Liquidity and Capital Resources

As of March 31, 2015 the Company had:

Unrestricted cash, cash equivalents and short-term investments of $488 million.

Outstanding debt and capital lease obligations of approximately $962 million consisting of the following:

$693 million outstanding under secured loan agreements to finance a portion of the purchase price for 11 Airbus A330-200 aircraft.

$132 million outstanding under secured loan agreements to finance a portion of the purchase price for 15 Boeing 717-200 aircraft.

$100 million in capital lease obligations to finance the acquisition of an Airbus A330-200, two Boeing 717-200 aircraft and aircraft-related equipment.

$29 million outstanding under floating rate notes to finance the acquisition of two Boeing 767-300 ER aircraft.

$8 million of outstanding Convertible Senior Notes.

In the first quarter, the Company repurchased $63 million (principal balance) of convertible notes outstanding. Repurchases to date have totaled $78 million (principal balance) or 91%, thereby eliminating the need to issue 10 million shares when the notes may have otherwise converted to common stock.

First Quarter 2015 Highlights:

Product and loyalty

Introduced the first of its 18 refurbished Boeing 717 aircraft with a comprehensive interior retrofit and a standard consistent layout of 128 seats in March 2015. The refurbishment will provide more seats for the peak demand period and eliminate operational complexity arising from different seat counts. To date, seven aircraft have completed the refurbishment program with all remaining Boeing 717 aircraft in the Company’s fleet expected to be retrofitted by the end of the year.

Fleet and financing

Added one new A330-200 aircraft under lease financing.

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Airbus A330-243 N391HA (msn 1309) taxies at Seattle-Tacoma International Airport.

Hawaiian Airlines aircraft slide show:

DOT announces a tentative decision to allow Delta Air Lines to keep the Seattle-Tokyo Haneda route (with stipulations), Hawaiian Airlines strongly reacts

The U.S. Department of Transportation (DOT) (Washington) has issued this tentative decision to allow Delta Air Lines (Atlanta) to retain the Seattle/Tacoma – Tokyo Haneda route provided the carrier operates daily, year-round service on the route. Here is the full statement:

The U.S. Department of Transportation (DOT) on March 27 proposed to permit Delta Air Lines to retain its authority to provide daily service between Seattle, Washington and Tokyo’s downtown Haneda Airport, but subject to additional conditions designed to ensure that Delta maintains a daily service in the Seattle market year-round.

DOT initiated this proceeding in late 2014 after it learned that Delta planned extensive winter season cutbacks for its Seattle-Haneda service. Instead of the daily service it had proposed in winning the route in a 2013 selection proceeding conducted by DOT, Delta would operate the service for approximately only one week every 90 days between October 2014 and late March 2015. American Airlines and Hawaiian Airlines, citing Delta’s failure to serve the route as it had proposed, each proposed to replace Delta and committed to operating daily flights from Tokyo’s Haneda Airport to Los Angeles and Kona, Hawaii, respectively.

In consideration of Delta’s recommitment to year-round daily service, DOT tentatively determined that it was in the public interest to permit Delta to retain the Seattle-Haneda route. However, any failure by Delta (absent DOT authorization) to operate any Seattle-Haneda flight, year-round, in either direction, would constitute a violation of its authority. Additionally, any failure by Delta (absent DOT authorization) to perform Seattle-Haneda service on two days of any seven-day period would mean the immediate loss of Delta’s authority.

DOT selected American Airlines’ proposal to provide Los Angeles-Haneda service as a backup should Delta fail to meet its requirements in serving the Seattle market.

Objections to the tentative decision are due by April 6, 2015. If objections are filed, answers to objections will be due April 13, 2015.

Delta issued this statement:

“Delta thanks the U.S. Department of Transportation for its tentative decision to allow the airline to continue its service between Seattle and Haneda Airport in Tokyo. After an extensive review, the DOT concluded that Delta’s Seattle-Haneda service provides the best public use of the available slot pair between the U.S. and Haneda Airport. Earlier this month, Delta resumed its nonstop service between Seattle and Haneda after a temporary seasonal suspension. Delta will operate year-round, nonstop flights between Seattle and Haneda as we continue to grow Delta’s international gateway at Seattle-Tacoma International Airport.”

Meanwhile Mark Dunkerley, President and CEO of Hawaiian Airlines (Honolulu), issued this strong response to the tentative DOT decision for Delta to keep the Tokyo Haneda slots:

The tentative decision issued by the U.S. Department of Transportation on March 27 to allow Delta Air Lines to retain the valuable right to fly from Tokyo’s Haneda International Airport for largely unused service to Seattle is tremendously disappointing. We are further disappointed that the U.S. DOT has determined that should Delta’s planned service continue to fail, the Haneda slots will be assigned to American Airlines.

Hawaiian is the only airline to have operated Haneda service continuously and successfully since the slot rights were granted. Our proposal provided more seats and would have resulted in more travelers flying between Japan and the United States than either Delta’s or American’s proposal. Kona is the largest unserved market in this proceeding, and Hawaiian’s proposed route would have generated more economic benefit than that offered by either Delta or American. None of these facts are in dispute by the DOT.

Sadly, by dismissing Hawaiian’s proposed Kona route as just simply being additive to the routes already serving Hawaii, the DOT has once more failed to appreciate the geography of the 50th state. Kona and Honolulu are separate markets, separate communities and indeed are located on separate islands. The tentative ruling also reveals a long-held institutional bias among decision makers favoring the interests of U.S. business travelers over those of U.S. travel-related businesses and travelers in general.

Hawaiian will be considering its next steps in this proceeding in the coming days.

Copyright Photo: TMK Photography/AirlinersGallery.com. Delta’s Airbus A330-223 N860NW (msn 778) is pictured in action at Seattle-Tacoma International Airport (SEA).

Delta Air Lines aircraft slide show:

Hawaiian Airlines retrofits the cabin of its first Boeing 717

Hawaiian Airlines (Honolulu) has announced the completion of a comprehensive retrofit on the first of its 18 Boeing 717 aircraft, featuring an island-inspired interior cabin redesign and new lightweight Main Cabin seating from Acro Aircraft Seating Limited (below).

Above Photo: Hawaiian Airlines.

Previously, five different cabin configurations were operating among Hawaiian’s neighbor island fleet. When all reconfigurations are complete later this year, the identical galley, lavatory, and 128-seat configuration onboard each aircraft will provide a consistent onboard experience for travelers while decreasing the airline’s operational complexity.

Intended to evoke high-performance automotive design, the new Main Cabin seats complement the fast and reliable service of Hawaiian’s 20 to 60 minute flights. The seatbacks offer a ‘tablet table’ machined from solid aluminum, sized and designed for complimentary beverage service and the use of a tablet device.

The refreshed interior color palette connects travelers with the elements of the islands through earth tones, a deep aqua seat, and accents of fuchsia and sky blue. Contrast stitching in the upholstery brings out natural forms of the islands. Other design elements include new seat covers and leather arm caps in First Class; new carpeting, galley flooring and curtains; and new forward windows on certain aircraft.

The airline’s entire narrow-body fleet, which operates more than 160 short haul flights daily between the islands of the state, will be retrofitted to feature these new cabin enhancements by the end of 2015.

Top Copyright Photo: Ivan K. Nishimura/AirlinersGallery.com. Boeing 717-22A N475HA (msn 55121) taxies at the Honolulu hub.

Hawaiian Airlines aircraft slide show:

Hawaiian Airlines again is the best on-time U.S. airline for 2014, Envoy Air is the worst

Hawaiian Airlines (Honolulu), helped by short flights in a good weather state, continues to record the best on-time performance for U.S. Airlines, as reported by the U.S. Department of Transportation. Hawaiian led the list for the 11th year in a row. Here is the full list:

Hawaiian issued this statement:

Continuing a remarkable streak of on-time consistency that began in 2004, Hawaiian Airlines led the nation’s carriers in punctuality for the 11th year in a row, as reported by the U.S. Department of Transportation (DOT).

Hawai’i’s largest and longest-serving airline averaged a 91.9 percent on-time performance rating for the full year 2014, earning the top ranking in 11 of the 12 months and exceeding the industry average for the year by 15.7 percentage points. For the month of December, Hawaiian Airlines ranked second, recording an 87.9 percent on-time performance rating.

Hawaiian Airlines also ranked second in fewest flights cancelled among all carriers for the month of December with 0.3 percent, representing 21 cancellations out of 6,426 flights.

During the fourth quarter of 2014, Hawaiian Airlines also ranked first nationally for having had the least number of passengers denied boarding, (also known as ‘being bumped’). During this period, not one of the airline’s almost 2.5 million passengers was involuntarily denied boarding.

Hawaiian Airlines provides daily nonstop service to Hawai’i from 11 gateway cities in North America – more cities than any other carrier – using Airbus A330-200 and Boeing 767-300 aircraft, making it the only carrier to offer wide-body, twin-aisle aircraft for all transpacific flights. Hawaiian Airlines also operates approximately 160 daily flights between the Hawaiian Islands using Boeing 717-200 aircraft.

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Airbus A330-243 N370HA (msn 1511) departs from Los Angeles International Airport bound for Honolulu.

Hawaiian Airlines aircraft slide show:

Hawaiian reports GAAP 4Q net income of $11.1 million and $68.9 million net profit for 2014

Hawaiian Holdings, Inc. (Honolulu), parent company of Hawaiian Airlines, Inc. (Honolulu), today reported its financial results for the fourth quarter and full year 2014.

GAAP net income in the fourth quarter of $11.1 million or $0.17 per diluted share. For the full year, GAAP net income of $68.9 million or $1.10 per diluted share.

Adjusted net income in the fourth quarter of $26.1 million or $0.40 per diluted share, an increase of $14.1 million or $0.18 cents per diluted share year-over-year. For the full year, adjusted net income grew to $97.1 million or $1.55 per diluted share compared to $46.6 million or $0.88 per diluted share in the prior year.

Operating revenue increased to $575 million for the fourth quarter and $2.3 billion for the full year. This resulted in an operating revenue per available seat mile (RASM) increase of 6.1%, year-over-year for the fourth quarter, and for the full year an increase of 5.6% year-over-year.

“2014 finished on a high note with the company posting much better results than a year ago,” said Mark Dunkerley, Hawaiian Airlines president and chief executive officer. “We served more customers than ever before, grew revenues, improved profitability and strengthened our balance sheet. I have our employees to thank for Hawaiian’s performance on the ground, in the air and in our financial statements. Their hard work helps overcome the advantage that our competitors generate through their massive size alone. 2015 will be another year of improvement as long as demand, fuel and industry capacity in our marketplaces remain as forecast.”

Liquidity and Capital Resources

As of December 31, 2014 the Company had:

Unrestricted cash, cash equivalents and short-term investments of $524 million.

Outstanding debt and capital lease obligations of approximately $1,050 million consisting of the following:
$714 million outstanding under secured loan agreements to finance a portion of the purchase price for 11 Airbus A330-200 aircraft.

$137 million outstanding under secured loan agreements to finance a portion of the purchase price for 15 Boeing 717-200 aircraft.

$102 million in capital lease obligations to finance the acquisition of an Airbus A330-200, two Boeing 717-200 aircraft and aircraft-related equipment.

$30 million outstanding under floating rate notes to finance the acquisition of two Boeing 767-300 ER aircraft.

$67 million of outstanding Convertible Senior Notes.

Fleet and financing

Retired $54 million of A330 bank debt.

Repurchased $15 million (principal amount) or 18% of convertible notes outstanding.

Executed a purchase agreement with Airbus for six A330-800neo aircraft with deliveries starting in 2019, replacing the previous order for six A350XWB-800 aircraft.

Entered into a new revolving credit facility that has availability of up to $175 million.

Added five new A330-200 aircraft and returned or retired two Boeing 767-300 aircraft.

Copyright Photo: Fred Freketic/AirlinersGallery.com. Airbus A330-243 N382HA (msn 1171) prepare to depart from New York (JFK).

Hawaiian Airlines aircraft slide show:

http://airlinersgallery.smugmug.com/Airlines-UnitedStates-2/Airlines-UnitedStates-2/Hawaiian-Airlines

Hawaiian files to serve the Kona – Tokyo Haneda market

Hawaiian Airlines (Honolulu) has filed an application with the U.S. Department of Transportation (DOT) to begin daily, nonstop service this summer between Tokyo International Airport at Haneda (HND) and Kona International Airport (KOA) on Hawai’i Island. The airline’s action was prompted by the U.S. DOT’s decision last month to review the public interest served by Delta Air Lines’ Seattle/Tacoma-Tokyo route after Delta reduced its frequency from daily to seasonal.

In its application, Hawai’i’s flagship carrier urged the U.S. DOT to reallocate Delta’s Haneda frequency based on market data, noting that Hawaiian Airlines’ Honolulu-Tokyo service has been “by far the most, if not only, successful route” of the four Haneda slot pairs granted to U.S. carriers in 2010.

The Hawai’i Tourism Authority (HTA) estimates that the proposed daily service will generate 531,721 visitor days and $146 million in visitor expenditures. Hawaiian Airlines’ application calculates that service directly to Kona will attract 39,000 additional visitors and result in 1,151 new jobs and $65 million in new direct spending.
The application has the full support of Governor David Ige and Hawai’i Island Mayor Billy Kenoi.

If approved, this would be Hawaiian Airlines’ fifth Japan route and third daily nonstop flight between Japan and Hawai’i, joining daily service to Honolulu from Tokyo and Osaka and thrice-weekly service between Honolulu, Sendai and Sapporo. Hawaiian Airlines anticipates it will begin service on or about June 1, 2015, utilizing its fleet of 20 294-seat Airbus A330-200 aircraft. The departure and arrival times will vary depending on time of year.

In other news, Hawaiian Airlines announced its system-wide traffic statistics for the full year, fourth quarter and the month of December 2014. The airline set a new annual record in its 85-year history with 10,195,145 passengers transported in 2014, 2.6 percent higher than the previous year.

Copyright Photo: Bruce Drum/AirlinersGallery.com. Airbus A330-243 N381HA (msn 1114) approaches the runway at Las Vegas McCarran International Airport.

Hawaiian Airlines aircraft slide show:

http://airlinersgallery.smugmug.com/Airlines-UnitedStates-2/Airlines-UnitedStates-2/Hawaiian-Airlines