Delta to operate the last Boeing 777 revenue flight on October 31

Delta Air Lines on Friday, October 30, 2020 will operate its last international Boeing 777 revenue flight from Tokyo (Haneda) to Los Angeles as cargo flight DL 3456.

Top Copyright Photo: Delta Air Lines Boeing 777-232 ER N865DA (msn 29737) CDG (Christian Volpati). Image: 912042.

Above Copyright Photo: Delta Air Lines Boeing 777-232 ER N862DA (msn 29734) JFK (Fred Freketic). Image: 949819.

The carrier is also closing out the Boeing 777 chapter with two domestic flights to Los Angeles:

October 30, 2020: DL 8787 Atlanta – Los Angeles 1500 (3 pm) – 1630 (4:30 pm) with N703DN

October 31, 2020: DL 8777 New York (JFK) – Los Angeles 1300 (1 pm) – 1600 (4 pm) with N701DN

Delta added the Boeing 777-200 ER type in March 1999.

Above Copyright Photo: Delta Air Lines Boeing 777-232 LR N706DN (msn 30440) LAX (Michael B. Ing). Image: 907044.

Above Copyright Photo: Delta Air Lines Boeing 777-232 ER N864DA (msn 29736) (Soaring Spirit – Salt Lake City 2002) CDG (Christian Volpati). Image: 912048.

British Airways announces its November schedule

Colony Hotel in Miami’s Art Deco District

British Airways will operate 52 long haul routes alongside its short haul network this November as the airline continues to adapt to changing restrictions around the globe as a result of the COVID-19 pandemic.

Services will continue to operate to US gateways including New York JFK, Boston, Los Angeles, Miami and San Francisco, with Newark added to the schedule in late November. Flights to the Caribbean continue to destinations including Barbados, Antigua and St Lucia, and flights will operate to destinations across Africa, the Middle East and Asia such as Dubai, Mumbai, Hong Kong and Singapore. Flights to Santiago, and Riyadh in Saudi Arabia, are also set to return.

British Airways will also continue to serve domestic destinations including Manchester, Glasgow, Aberdeen and Newquay. In continental Europe, cities like Paris, Munich, Geneva and Amsterdam, among others, will be connected to Heathrow by frequent, direct flights. There are also regular flights to beach destinations such as Lanzarote, Tenerife and Gran Canaria.

As always, the operation of any flight is subject to changes, international restrictions and government approval.

United Airlines launches world’s first free transatlantic COVID-19 testing pilot

United Airlines today announced the world’s first free transatlantic COVID-19 testing pilot program for customers. From November 16 through December 11, the airline will offer rapid tests to every passenger over 2 years old and crew members on board select flights from Newark Liberty International Airport (EWR) to London Heathrow (LHR), free of charge. Anyone who does not wish to be tested will be placed on another flight, guaranteeing everyone on board other than children under two will have tested negative before departure.

United will share customer feedback of this pilot with governments on both sides of the Atlantic to further demonstrate the effectiveness of these programs as an alternative to mandatory quarantines or duplicative travel restrictions. United has seen a positive impact on travel demand and significant increases in customer load factors and revenue when testing options are available.

United will collaborate with Premise Health, who will administer the rapid testing pilot program for the EWR-LHR flight. The test will be given to passengers traveling on United Flight 14, departing at 7:15 p.m., Mondays, Wednesdays and Fridays. Appointments for the test are required, and customers are advised to schedule their tests at least three hours before their flight. An on-site testing facility will be located at the Newark United Club near Gate C93.

Before the pandemic, United operated six daily flights between New York/Newark and London on a 767-300ER (76L), offering not only the most frequency among U.S. carriers but also the most business class and Premium Economy seats.

United was the first airline to announce optional pre-flight COVID-19 testing for customers. Earlier this month, the airline started offering customers traveling from San Francisco International Airport to Hawaii the option to take a same-day, pre-flight rapid test at the airport or a conveniently located drive-through test, for a fee. The program allows customers with a negative result to bypass Hawaii’s mandatory quarantine requirements and enjoy their time on the islands sooner. In the first 10 days, October 15 – 25, the San Francisco to Hawaii flights have seen a nearly 95% increase in passengers compared to the prior two-week period. United believes these positive trends illustrate a strong and pent-up demand for travel, customers’ willingness to use pre-flight COVID-19 testing and the importance of these programs as a means of opening borders.

And just last week, United participated in a successful test program between Newark and London of CommonPass, a digital health pass, aimed at enabling safer travel and the reopening of international borders. Customers who chose to participate in the program were able to seamlessly provide their COVID-19 test results to relevant governments.

Since the start of the pandemic, United has been a leader among U.S. airlines in enacting new policies and innovations designed to keep employees and passengers safer when traveling. It was the first U.S. airline to mandate masks for flight attendants, quickly following with all customers and employees. United was also among the first U.S. carriers to announce it would not permit customers who refused to comply with the airline’s mandatory mask policy to fly with them while the face mask policy is in place. United was also the first U.S. airline to roll out touchless check-in for customers with bags and the first to require passengers to take an online health assessment before traveling. And last month, the airline announced it will apply Zoono Microbe Shield, an EPA registered antimicrobial coating that forms a long-lasting bond with surfaces and inhibits the growth of microbes, to its entire mainline and express fleet before the end of the year.

Images: United Airlines.

Alrosa Avia operates the last Tu-154 passenger flight in Russia

Alrosa Avia operated the last Tupolev Tu-154 civil revenue flight on October 28, 2020 with 140 passengers between Mirny and Novosibirsk in Siberia with RA-85757.

Alrosa is a Russian airline that operates regional flights in Yakutia, regular and charter flights in Russia, international Charter flights to CIS countries, Asia and Europe, cargo transportation and special aviation operations. It is based at Mirny and Moscow-Domodedovo airports.

In addition to regular and charter flights, the company also provides ground handling at such airports as Mirny, Polyarny, Aikhal, and Lensk. The airline was formed on the basis of the Mirninsky air enterprise (map), which was a structural division of Alrosa since January 1, 2013, it has been operating as an independent legal entity.

Today, the airline’s regular flight geography covers more than 30 cities across Russia, including Moscow, Krasnoyarsk, Saint Petersburg, Krasnodar, Sochi, Anapa, Novosibirsk, Yekaterinburg, Tomsk, Hainan and other cities.

The company’s fleet consists of medium-haul Boeing 737-800 and Boeing 737-700 aircraft, modern regional an-38-100 aircraft specially equipped for operation in Siberia and the Far North, as well as an-24, An-26-100, Tu-134B, Tu-154M.

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Video of the last departure:

Last flight (in Russian):

Air Serbia recommencing Moscow flights

Air Serbia has made this announcement:

The JU 0652 Belgrade-Moscow flight on November 9, 2020. will mark Air Serbia’s re-establishment of the air connection with Russian Federation. The national airline plans to operate flights from Belgrade to the capital of Russia twice a week, on Mondays at 13:50 and Fridays at 7:30.

The last flight between the Serbian and Russian capitals, prior to the temporary suspension of air traffic due to the coronavirus pandemic, was carried out on March 18, 2020.

Air Serbia aircraft photo gallery:

KLM Cityhopper introduces Virtual Reality training for pilots

Starting on November 5, 2020, KLM Cityhopper will be introducing Virtual Reality (VR) training for pilots flying Embraer 175 and 190 aircraft. Developed in-house, the VR training courses will allow pilots to make more effective use of their training time and will also yield cost savings. KLM Cityhopper is the first airline to integrate VR into its pilot training for Embraer aircraft.

KLM subsidiary KLM Cityhopper has a fleet of Embraers serving European destinations. It decided to investigate the capabilities of VR in an effort to respond more flexibly to pilots’ differing training needs.

“Virtual Reality (VR) makes training more accessible. It is on-demand and site-independent – pilots don’t have to be in a classroom or a simulator at a certain time. What’s more, it invites them to explore, something they can do safely in a virtual environment,” says Sebastian Gerkens, Senior Instructor Embraer at KLM Cityhopper. “VR allows pilots to familiarise themselves with the cockpit in advance, so that they make more effective use of their simulator time.”

The new training approach will also generate cost savings, among other things because it cuts down on the number of external suppliers and makes pilot scheduling more flexible.

Three applications

The VR training courses for the Embraer 175 and 190 were developed by KLM’s own VR experts in cooperation with KLM Cityhopper. Training consists of three applications, all part of the Type Rating Course in which pilots learn the specific characteristics of the aircraft type they are going to fly.

Virtual cockpit – the pilot is inside the cockpit, i.e. an interactive, computer-generated image of the control panels.
Instruction video – the pilot watches a 360-degree POV video of a flight from the cockpit jump seat.
Virtual walkaround – the pilot walks through and around the aircraft, composed of 360-degree static photographs.

“These are also the three different ways to capture content used to create VR applications,” explains Werner Soeteman, manager of the VR Centre Of Excellence at KLM IT. “The interactive virtual cockpit was created on computers entirely by our team of VR developers and 3D designers. To produce the 360-degree video and photographs, one of our VR engineers sat in the cockpit operating an advanced 360-degree camera during a flight, in close cooperation with the KLM Cityhopper pilots. Our developers haven’t the faintest idea how an Embraer works, although they’ve certainly learned a lot.”

EASA certification

KLM has been long been interested in using VR in staff training. For example, it already has VR training courses for maintenance engineers and KLM Cityhopper cabin crew. Now the Embraer 175 and 190 pilots are joining this select company.

The VR courses complement KLM’s existing training programme. KLM Cityhopper is exploring whether it can obtain EASA certification for these courses, which would then eventually replace some of the standard training components, such as classroom instruction, the cockpit poster and textbooks. The safety and quality of training is and naturally always will be top priority.

KLM Cityhopper aircraft photo gallery:

Spirit Airlines loses $99.1 million in the third quarter

Spirit Airlines, Inc. today reported third quarter 2020 financial results.

Ended the third quarter 2020 with $2.1 billion of unrestricted cash, cash equivalents
and short-term investment securities

Third Quarter 2020

Third Quarter 2019

As Reported

Adjusted

As Reported

Adjusted

(GAAP)

(non-GAAP)¹

(GAAP)

(non-GAAP)¹

Total Operating Revenues

$401.9 million

$992.0 million

Pre-tax Income (Loss)

$(128.5) million

$(276.8) million

$109.0 million

$118.1 million

Pre-tax Margin

(32.0)%

(68.9)%

11.0%

11.9%

Net Income (Loss)

$(99.1) million

$(215.4) million

$83.5 million

$90.5 million

Diluted Earnings (Loss) Per Share

$(1.07)

$(2.32)

$1.22

$1.32

“Our future is very bright. While the pandemic continues to affect demand for air travel, we do not believe it changes our competitive position. Our excellent operational performance, strong Guest satisfaction metrics, and industry-leading cost structure, position us well to be among the first to reach sustained profitability,” said Ted Christie, Spirit’s President and Chief Executive Officer. “I thank the entire Spirit team for how well they have navigated the challenges in this incredibly dynamic time, shoring up our resources, and putting us in a position of strength to fully participate when demand recovers.”

COVID-19
As the COVID-19 pandemic continues to evolve, the Company’s financial and operational outlook remains subject to change. The Company continues to monitor the impacts of the pandemic on its operations and financial condition, and to implement mitigation strategies while working to preserve cash and protect the long-term sustainability of the Company. Spirit has implemented measures for the safety of its Guests and Team Members as well as to mitigate the impact of COVID-19 on its financial position and operations. Please see the Company’s Quarterly Report on Form 10-Q for the period ending September 30, 2020 for additional disclosures regarding these measures.

Capacity and Operations
The Company continues to experience a significant decline in demand due to COVID-19. Load factor for the third quarter 2020 was 68.1 percent on a year-over-year capacity decrease of 33 percent.

For the fourth quarter 2020, Spirit estimates its capacity will be down approximately 25 percent year over year. On a monthly basis, Spirit estimates its capacity for October will be down approximately 36 percent and that November and December will both be down about 20 percent compared to the same periods last year. The situation remains fluid and actual capacity adjustments may be different than what the Company currently expects.

As measured by the DOT, for the third quarter 2020, Spirit’s Completion Factor² was 99.8 percent, which earned Spirit a first-place ranking among reporting carriers. Spirit achieved on-time performance² of 90 percent or better for each of the three months during the third quarter 2020. Year-to-date ended September 30, 2020, Spirit’s Completion Factor² was 97.3 percent, second among reporting carriers, and its on-time performance² was 86.2 percent, third among reporting carriers.

Revenue Performance
Total operating revenue for the third quarter 2020 was $401.9 million, a decrease of 59.5 percent year over year as demand for air travel remains depressed due to the COVID-19 pandemic.

Based on current demand and level of operation assumptions, Spirit estimates its fourth quarter total operating revenue will be down approximately 43 to 45 percent year over year.

For the third quarter 2020, total revenue per passenger flight segment (“Segment”) decreased 21.1 percent year over year to $86.94. While both average fare and non-ticket spend per passenger declined year over year, as expected, non-ticket revenue per Segment declined much less than fare revenue per Segment. Fare revenue per Segment decreased 35.1 percent to $35.57 while non-ticket revenue per Segment only decreased 7.2 percent to $51.37^3.

Cost Performance
For the third quarter 2020, total GAAP operating expenses, including $148.3 million of special items, were $501.4 million, a decrease of 42.2 percent, year over year. Adjusted operating expenses for the third quarter 2020 were $649.7 million⁴, a decrease of 24.3 percent year over year. These changes were primarily driven by a 62.9 percent decrease in aircraft fuel expense due to decreases in both fuel rate and volume. In addition, other expenses, such as distribution, ground handling, and crew accommodation expenses were lower year over year due to a 37.4 percent decrease in flight volume. Better operational performance also drove a significant decrease in passenger re-accommodation expense compared to the same period last year. Despite a significant decrease in flight volume compared to the third quarter last year, other rents and landing fees increased year over year due to airport signatory adjustments and rate increases at various airports Spirit serves.

In late August 2020, the Company and its unions and work group representatives worked to find a solution to mitigate planned furloughs that were set to take effect on October 1, 2020. Various voluntary time-off programs in place through May 2021 will enable the Company to capture savings similar to what would have been achieved with the planned furloughs while preserving jobs, and maintaining options, should demand trends worsen or recover faster than expected.

For the fourth quarter 2020, Spirit estimates its total operating expenses, excluding special items will range between $675 to $685 million. This is similar to its third quarter 2020 adjusted operating expenses on an estimated approximately 10 percent more capacity in the fourth quarter 2020 than third quarter 2020.

Fleet
Spirit took delivery of one new A320neo aircraft during the third quarter 2020, which was debt financed. Spirit ended the quarter with 155 aircraft in its fleet. Earlier in October 2020, Spirit took delivery of its two remaining 2020 deliveries, one of which was debt financed and the other was secured under a sale/leaseback transaction.

Liquidity and Capital Deployment
Spirit ended the third quarter 2020 with unrestricted cash, cash equivalents, and short-term investment securities of $2.1 billion.

“Our team continues to adapt to the fluid environment caused by the challenges of COVID-19. In addition to flexing our network as we see shifts in demand, we are taking proactive measures to manage costs, conserve cash, and enhance our liquidity profile. Our average daily cash burn⁵ for the third quarter 2020 was $2.3 million, better than our most recent guidance of approximately $3 million per day, primarily due to better top-line sales and timing of payments. We estimate our average daily cash burn⁵ for the fourth quarter 2020 will average about $2 million per day, slightly better than what we experienced for the third quarter 2020. Given that we have fortified our liquidity position making cash burn as a metric less relevant, we now intend to migrate our guidance towards more traditional metrics such as EBITDA and EBITDA margin that better reflect a company’s cash generation capabilities. For the fourth quarter 2020, we estimate our EBITDA margin will range between negative 9 percent to negative 14 percent,” said Scott Haralson, Spirit’s Chief Financial Officer. “We have a solid foundation and, as we move towards recovery, I am confident that the strength of our business model will be a key differentiator of our success.”

Since the onset of the pandemic, Spirit has been focused on reducing costs and preserving and enhancing its liquidity position. During the third quarter 2020, the Company:

Completed a private offering of an aggregate of $850 million principal amount of 8.00% senior secured notes due 2025. The Notes are guaranteed by Spirit and certain subsidiaries of Spirit. The Notes are secured by, among other things, a first priority lien on the core assets of Spirit’s loyalty programs (comprised of cash proceeds from its Free Spirit co-branded credit card programs, its $9 Fare Club program membership fees, and certain intellectual property required or necessary to operate the loyalty programs) as well as Spirit’s brand intellectual property. Upon successful completion of this offering, the Company announced that it had elected not to participate in the U.S. Department of the Treasury (“Treasury”) loan program under the CARES Act;
Completed the sale of 9,000,000 shares of its common stock pursuant to the at-the-market offering program entered into on July 22, 2020. The Company received proceeds of $156.7 million, net of issuance costs, from this program.

In April 2020, Spirit entered into a Payroll Support Program (“PSP”) agreement with the Treasury pursuant to the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), for an initial amount of $334.7 million, of which the Company received $301.3 million in the second quarter 2020 and the remaining $33.4 million in the third quarter 2020. Of the $334.7 million, $70.4 million was in the form of a low-interest, 10-year loan. In late September 2020, the Company was notified by the Treasury that Spirit would receive $9.7 million of additional PSP funds. Of the additional $9.7 million, $2.9 million is in the form of a low-interest, 10-year loan. Also, in connection with its participation in the PSP, the Company has issued warrants to the Treasury to purchase up to 520,797 shares of the Company’s common stock at a strike price of $14.08 per share with a fair value of $3.9 million, net of issuance costs. The remaining amount of $266.8 million, net of issuance costs, is in the form of a grant and was recognized in special credits in the Company’s condensed consolidated statements of operations during the second and third quarters 2020. The Company booked the additional $9.7 million as a receivable in the third quarter 2020 and received the funds in early October 2020.

Total capital expenditures for 2020 are estimated to be approximately $545 million (approximately $200 million net of financings), of which approximately $45 million (approximately $5 million net of financings) is expected to be incurred in the fourth quarter of 2020.
Spirit expects to take delivery of 16 aircraft in 2021. Of the 2021 aircraft deliveries, ten are secured under direct lease arrangements and six are not yet secured under financing agreements. The Company anticipates that it will use sale/leaseback transactions to finance these six aircraft. Based on this assumption, the Company estimates total capital expenditures in 2021 will consist of approximately $40 million of pre-delivery deposits, net of refunds, and another $60 to $85 million of other capital expenditures primarily related to aircraft, including one spare engine and other spare parts.

Tax Rate
The Company recorded a $1.2 million discrete tax benefit in the third quarter 2020 related to the finalization of the Net Operating Loss carryback to tax year 2013. On a GAAP basis, the Company’s tax rate for third quarter 2020 was 22.9 percent. Excluding this discrete tax benefit and special items, the Company’s effective tax rate for the third quarter 2020 was 22.2 percent.

Spirit Airlines aircraft photo gallery:

Allegiant loses $29.1 million in the third quarter

Allegiant Travel Company today reported the following financial results for the third quarter 2020, as well as comparisons to the prior year:

Consolidated	Three Months Ended September 30,				Percent Change		Nine Months Ended September 30,				Percent Change
(unaudited) (in millions, except per share amounts)	2020		2019				2020		2019
Total operating revenue	$	201.0	$	436.5	(54.0)	%	$	743.5	$	1,379.9	(46.1)	%
Operating income (loss)	(33.1)		72.1		(145.9)		(257.3)		271.3		(194.9)
Income (loss) before income taxes	(44.7)		56.9		(178.6)		(321.9)		222.6		(244.6)
Net income (loss)	(29.1)		43.9		(166.3)		(155.3)		171.6		(190.5)
Diluted earnings (loss) per share	$	(1.82)	$	2.70	(167.4)		$	(9.75)	$	10.54	(192.5)



Consolidated – adjusted	Three Months Ended September 30,				Percent Change		Nine Months Ended September 30,				Percent Change
(unaudited) (in millions, except per share amounts)	2020		2019				2020		2019
Adjusted operating income (loss) ^{(1) (2)}	$	(77.4)	$	72.1	(207.4)	%	$	(128.8)	$	271.3	(147.5)	%
Adjusted income (loss) before income taxes^{(1) (2)}	(89.0)		56.9		(256.4)		(166.8)		222.6		(174.9)
Adjusted net income (loss)^{(1) (2)}	(68.5)		43.9		(256.0)		(128.4)		171.6		(174.8)
Adjusted diluted earnings (loss) per share ^{(1) (2)}	$	(4.28)	$	2.70	(258.5)		$	(8.07)	$	10.54	(176.6)

(1) Adjusted to exclude COVID related special charges, the benefit from the CARES Act payroll support program, and the portion of the tax benefit (as applicable) attributable to the CARES Act.
(2) Denotes a non-GAAP financial measure. Refer to the Non-GAAP Presentation section within this document for further information.

“As we continue to navigate through the pandemic we have been encouraged by the modest, yet consistent improvements during the third quarter and into the fourth,” stated Maurice J. Gallagher, Jr., chairman and CEO of Allegiant Travel Company. “Consumer confidence towards air travel is improving as seen in our quarterly performance. We completed the quarter beating consensus with a loss per share of $4.28, excluding one-time, special items, and the benefit from the CARES Act. Our scheduled capacity year-over-year was down less than seven percent, perhaps the best showing in the industry. Revenue is also trending in the right direction with September totals down 43 percent versus prior year. Although we still have a long road ahead of us, the progress we’ve seen is a direct reflection of the quality of our people and the nimbleness of the model.

“As we move into the fourth quarter, we remain focused on cash management. Our cash preservation strategy continues to center around maintaining a broad selling presence as well as stripping costs from the business. Our revenue and planning teams have done an exceptional job optimizing our schedule available for sale. We’ve seen average daily gross bookings increase from just over $2 million per day during the third quarter to over $3 million per day thus far in the fourth quarter. On the cost front, we successfully reduced variable operating expenses by nearly 30 percent, excluding the CARES Act payroll support benefit and one-time special items, which outpaces our reduction in capacity more than threefold. These savings are important in paving the way to cash break-even. Our cash preservation strategies coupled with strategic capital raises over the last several weeks have contributed to our pro forma cash balance of $850 million.

“Even though we’re pleased with recent progress, we remain cautious. We have had to make tough decisions the past few months, including a reduction in our workforce. Although difficult, these steps were necessary to right size our organization to better align with demand. This environment has been difficult for our team members, and I cannot thank them enough for their continued hard work and dedication during this trying time. Their efforts to prioritize health and safety for our passengers, and our leadership efforts to bolster the financial health of the company have laid a solid foundation for our recovery. This has been and will continue to be a slow climb out of this abyss known as COVID. At this point, I believe we are leading the way out towards light ahead in the coming months and year.”

Covid-19 Responses – Update

Ranked by Safe Travel Barometer as #1 airline among North American carriers and among the top five worldwide for best COVID-19 Traveler Safety Measures, with results based on an independent audit of more than 150 airlines
Prioritizing the health and safety of our passengers and crew members by upholding the principles of our Going the Distance for Health and Safety program, which include enhanced cleaning protocols, air purity guidelines, and new service practices and boarding procedures designed to provide additional distancing between customers whenever possible
Accommodating travel flexibility by waiving change and cancellation fees for all customers with future travel through the end of 2020, extending the expiry on credit vouchers to two years, and offering an opt-in option within the booking path to alert customers if their flight has reached 65 percent capacity allowing the option to re-book or receive a refund
Reduced management and support teams by roughly 300 positions, which includes voluntary leaves
- 25 percent reduction in these work groups
- Includes 220 positions previously disclosed
- Anticipated annual savings of roughly $20 million
Furloughed roughly 130 pilots, a 13 percent reduction
- 100 furloughed as of October 1, with an additional 30 expected November 1

Third Quarter 2020 Results

Recorded positive cash inflows for the month of September, excluding a $5 million payment in connection with terminating the loan agreement intended to finance the development of Sunseeker Resorts Charlotte Harbor
Reduced scheduled third quarter capacity by 6.5 percent
- Completed the quarter with load factor in the month of September of 57.4 percent, the highest month since the onset of the pandemic in March
Recognized total special charges related to COVID-19 of $33.6 million during the third quarter
Anticipate fourth quarter capacity to be reduced by 15 percent from prior year but will continue to adjust based on demand trends
Minimal close-in cancellations during the third quarter and anticipate the fourth quarter will be similar
Total revenue for the quarter was $201.0 million, down 54.0 percent year over year
- September total revenue down 42.8 percent, the lowest monthly reduction since the onset of the pandemic
- Average total ancillary revenue per passenger (includes air-related charges and third party products) remains strong, despite current yield pressure, at $55.70 per passenger, up 1.5 percent year-over-year
Operating expense was $234.1 million, down 35.8 percent year-over-year on reduced system-wide capacity of 9.4 percent
- Variable operating expense, defined as total operating expense excluding the benefit of the CARES Act, one-time special items, aircraft leases, and depreciation and amortization, down 29.2 percent versus prior year
Advertising spend down 75 percent year-over-year, yet website visitors derived by either directly typing www.allegiant.com or by clicking on a marketing email promotional link are up 17 percent versus prior year
- Customer conversion rate is up 36 percent from pre-pandemic levels
Named #1 airline co-branded credit card two years in a row by USA Today

Balance Sheet, Cash and Liquidity

Total cash and investments at September 30^th was $709.8 million
Total sources of liquidity received during the third quarter around $184.9 million
- Obtained $84 million in financings secured by A320 aircraft and CFM engines
- Entered into a sale leaseback transaction, which included the sale of four A320-series aircraft, three of which closed in the third quarter generating $30 million
  - Fourth sale closed in October, generating $10 million
- Federal income tax refund of $48.7 million related to tax net operating losses from 2018
  - Expect a federal income tax refund in excess of $125 million related to 2020 net operating losses to be received during the first half of 2021
- Additional payroll support related to the CARES Act of $22.2 million
In early October, issued $150 million of senior secured notes backed by collateral pledged to existing Term Loan
- Cash balance pro forma for this financing in excess of $850 million
Debt, net of liquidity, as of September 30^th was $840 million, down roughly $100 million from December 31, 2019
Third quarter interest expense down 38.8 percent versus prior year
3Q20 daily cash burn averaged $1.3 million ⁽¹⁾
- Gross bookings averaged just above $2.0 million per day during the quarter
- Includes $15 million of payments to Sixth Street Partners (formerly TSSP) to terminate loan agreement intended to finance the development of Sunseeker Resorts Charlotte Harbor
As of September 30^th, have 22 unencumbered aircraft and 4 unencumbered spare engines
Air traffic liability at September 30^th was $334 million
- Balance related to future scheduled flights is $116 million
- Balance related to travel vouchers issued for future use is $218 million

(1) Daily cash burn defined as cash from operations less scheduled debt and rent payments and capital expenditure outflows excluding aircraft and engine acquisitions as they are expected to be financed. Excludes benefits received from CARES Act such as Payroll Support Program funding and tax refunds from net operating loss carry-backs.

Capital Expenditures

Remaining 2020 spend related to capital expenditures is roughly $130 million
- Includes five previously executed purchase commitments for aircraft
- Roughly $10 million of deferred heavy maintenance
Full year 2021 capital expenditures, including deferred heavy maintenance, expected to be roughly $125 million
- Includes two previously executed purchase commitments for aircraft
Expect to have 93 operating aircraft at year end 2020
- Does not include owned aircraft currently in storage programs

Southwest Airlines announces initial schedules for Chicago O’Hare and Colorado Springs

Southwest Airlines today published its initial flight schedules for both Chicago O’Hare International and Colorado Springs Municipal airports.

Chicago (O’Hare) service begins February 14, 2021
More than 35 years after landing at Chicago Midway International Airport, Southwest will expand its footprint in the Chicagoland area, adding complementing service from Chicago O’Hare International Airport starting Feb. 14, 2021. The carrier’s initial service will offer 20 departures daily from O’Hare:

$39 one-way nonstop between Chicago (O’Hare) and Nashville (four times daily);
$79 one-way nonstop between Chicago (O’Hare) and Baltimore/Washington (four times daily);
$89 one-way nonstop between Chicago (O’Hare) and Denver (six times daily);
$99 one-way nonstop between Chicago (O’Hare) and Dallas (Love Field) (four times daily); and
$109 one-way nonstop between Chicago (O’Hare) and Phoenix (twice daily).

The number of seats, days of week, and markets for these fares are limited.

During its more than three-decades of service to Chicago, Southwest has grown to become Chicago Midway’s largest airline while also employing more than 4,800 People in the city.

Colorado Springs service begins March 11, 2021
Southwest will also launch service from its fourth destination in Colorado when it takes off from Colorado Springs Municipal Airport on March 11, 2021. The new service links the Pikes Peak region nonstop with up to 13 flights a day to destinations across Southwest’s growing network.

$29 one-way nonstop between Colorado Springs and Denver (four times daily);
$59 one-way nonstop between Colorado Springs and Las Vegas (twice daily);
$59 one-way nonstop between Colorado Springs and Phoenix (twice daily);
$69 one-way nonstop between Colorado Springs and Dallas (Love Field) (three times daily); and
$89 one-way nonstop between Colorado Springs and Chicago (Midway) (twice daily).

Silver Airways to launch service From Jacksonville to Tampa and Fort Lauderdale/Hollywood

Silver Airways has announced new safe, reliable and customer-focused service with nonstop twice-weekly flights from Jacksonville, Florida to each of Tampa and Fort Lauderdale/Hollywood.