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Spirit Airlines to start Latrobe-Las Vegas flights on April 16, 2015, issues its “State of Hate” report

Spirit Airlines (Fort Lauderdale/Hollywood) has announced new daily service from Arnold Palmer Regional Airport in Latrobe (near Pittsburgh), Pennsylvania to Las Vegas starting April 16, 2015.

Spirit currently offers year-round flights to Orlando and Fort Lauderdale/Hollywood, with seasonal service to Myrtle Beach, Fort Myers (starting December 18, 2014) and Tampa (starting December 19, 2014).

In other news, the airline that people love to hate, has issued its “State of Hate” report on what passengers do not like with airlines:

People hate air travel. When given the opportunity, consumers have very little trouble expressing their hate against airlines. In fact thousands of people unleashed their hate last summer when Spirit Airlines opened itself to feedback asking people why they hate to fly. The airline has now released the results of this feedback in their “State of Hate Report.”

Last July Spirit announced their “Hug The Haters” campaign along with the “Hate Thousand Miles Giveaway” where they encouraged consumers to share their frustrations with flying, and in return gave the “haters” 8,000 FREE SPIRIT® miles to use on future Spirit flights. The response was overwhelming. In just a few days, almost 30,000 people shared their hate.

The report made it clear air travel is a hassle and annoys people, no matter which airline you fly. Spirit assumed that since they asked for the candid feedback, most of the hate would be directed at them. To their surprise, 60 percent of the responses they received were frustrations with airlines other than Spirit.

“I think if any organization asks for feedback you would expect the vast majority of responses would be directed at the company that seeks it,” said Spirit’s President and CEO Ben Baldanza. “But in this case we were surprised that most consumers chose to share their frustrations about other airlines.”

Spirit has taken the feedback, compiled the data, and today released what they call “The State Of Hate” report which can be found at www.hatethousandmiles.com.

“Airlines mess up and air travelers get frustrated,” added Baldanza. “Spirit is listening and willing to be transparent enough to admit where we can do things better. The feedback we received makes it clear no airline is immune from upsetting their customers, and at Spirit we can do a better job of explaining how flying with us is different.”

Here are some of the results of the State of Hate Report:

20% of consumers who responded hate airline seats. They hate everything about them: size, shape, getting to them, leg room, and reclining.
16% shared their frustrations with lost bags and baggage policies.
15% complained about delays and airline customer service.
The report also lists the different types of complaints and which airlines have the highest percentage of complaints by category. Not surprisingly, Spirit led the pack in frustrations about its “fee” structure.

“We don’t look at them as fees, they are options that our customers can choose, or not depending on how much money they wish to save,” said Baldanza. “But this clearly shows we need to continue educating our customers about our business model. Our experience shows once customers understand how much money they save with our model, they like it a lot.”

As has come to be expected, Spirit took the feedback and had some fun with it. Another surprising aspect of the feedback was the level of vitriol and expletives used in many of the hate messages. Spirit created a “Vulgarity Index” showing the different curse words that are used to describe the respondents hate for air travel. The report also contains a fun and irreverent newscast presenting the results of the report with puppets as the news anchors.

“The bottom line is, airline travel is frustrating,” continued Baldanza. “So the least we can do is keep offering the lowest fares in the industry to help lessen some of the hate. This allows our customers to have more money to spend once they get to the place they want to be, instead of spending their entire travel budget on the cost of a plane ticket.”

Video: CNBC’s Jim Cramer interviews CEO Ben Baldanza about their financial performance:

Spirit Airlines:

CBS’ Sunday Morning interview with Spirit Airlines’ CEO Ben Baldanza

Preview: The no-frills carrier doesn’t rank high in customer satisfaction, but Spirit Airlines (Fort Lauderdale/Hollywood) has plenty of loyal customers buying up its super-cheap seats. CEO Ben Baldanza sat down with Richard Schlesinger of CBS News to explain why his planes fill up so much.

Video:

Read the article from Bloomberg Businessweek: CLICK HERE

Is this the future of domestic air travel; complain about an airline but continue to fill it up the planes with its attractive low fares and add-ons for everything?

Spirit Airlines:

Spirit Airlines reports 4th consecutive profitable year and record full-year 2012 net income

Spirit Airlines, Inc. (Fort Lauderdale/Hollywood) reported fourth quarter 2012 and full year 2012 financial results.

Net income for the fourth quarter 2012 was $19.5 million, or $0.27 per diluted share. Results for the fourth quarter and full year 2012 include an estimated $25 million negative revenue impact ($24 million pre-tax income, $15 million after tax) from Hurricane Sandy.
Adjusted CASM ex-fuel for the fourth quarter 2012 decreased 2.5 percent year-over-year. See “Reconciliation of Adjusted CASM ex-fuel to CASM” table below for more details.
Net income, excluding special items, for the full year 2012 was a record $103.8 million, or $1.43 per diluted share¹. GAAP net income for the full year 2012 was a record $108.5 million, or $1.49 per diluted share.
For the fourth quarter 2012, Spirit achieved an operating margin, excluding special items, of 9.7 percent (15.8 percent adjusted for Hurricane Sandy)¹. For the full year 2012, Spirit’s operating margin, excluding special items, was 12.6 percent (14.2 percent adjusted for Hurricane Sandy). Operating margin on a GAAP basis was 9.7 percent and 13.2 percent for the fourth quarter and full year 2012, respectively.
Spirit ended 2012 with $416.8 million in unrestricted cash.
Spirit’s return on invested capital (before taxes and excluding special items) was 26.5 percent (28.8 percent adjusted for Hurricane Sandy) for the year ended December 31, 2012. See “Calculation for Return on Invested Capital” table below for more details.

“2012 was a very exciting year for Spirit. We successfully grew our business, delivered strong financial results and remained committed to our low-cost, low-fare strategy. This low-cost, low-fare strategy helped us to achieve among the highest margins in the industry,” said Ben Baldanza, Spirit’s President and Chief Executive Officer. “I want to thank and congratulate our team members that contributed to our success.”

Revenue Performance

For the fourth quarter 2012, Spirit’s total operating revenue was $328.3 million, an increase of 19.8 percent, compared to fourth quarter 2011.

Total revenue per available seat mile (“RASM”) for the fourth quarter 2012 was 11.10 cents, a decrease of 6.6 percent compared to the fourth quarter 2011 due to the negative revenue impact from Hurricane Sandy and a 5.3 percent increase in average stage length.

Passenger flight segment (“PFS”) volume grew 22.0 percent year-over-year in the fourth quarter 2012 with average non-ticket revenue per PFS for the fourth quarter 2012 increasing 9.4 percent year-over-year to $52.73 and average ticket revenue per PFS for the quarter decreasing 8.6 percent year-over-year to $71.30. The growth in non-ticket revenue per PFS was primarily driven by a passenger usage fee increase implemented late in the fourth quarter of 2011.

For the full year 2012, total operating revenue increased 23.1 percent to $1.3 billion compared to the same period last year on a 21.3 percent increase in available seat miles.

Cost Performance

Total operating expenses in the fourth quarter 2012 were $296.3 million, an increase of 25.6 percent compared to the same period in 2011. The increase in operating expenses was primarily driven by fuel and other expenses associated with additional available seat miles (“capacity”) which grew by 28.3 percent year-over-year.

Cost per available seat mile excluding special items and fuel (“Adjusted CASM ex-fuel”) for the fourth quarter 2012 decreased 2.5 percent year-over-year to 5.93 cents. Primary drivers of the decrease included lower labor expense per ASM year-over-year due to lower unit overhead costs, lower distribution expense per ASM as a result of a decrease in credit card fees, and an increase in average stage length. These benefits were partially offset by start-up costs related to Spirit’s seat maintenance program of $1.4 million during the fourth quarter 2012, bringing the total start-up costs related to this program to $6.8 million, and higher depreciation and amortization expense related to amortization of heavy maintenance events.

Total operating expense for the full year 2012 was $1.1 billion, up 23.5 percent as compared to the full year 2011, largely driven by fuel and other expenses associated with capacity increasing by 21.3 percent year-over-year.

Selected Balance Sheet and Cash Flow Items

As of December 31, 2012, Spirit had $416.8 million in unrestricted cash and cash equivalents, no restricted cash, no debt on its balance sheet, and total shareholders’ equity of $582.5 million.

During the fourth quarter 2012, Spirit incurred capital expenditures of $2.1 million, paid $5.8 million in pre-delivery deposits (“PDPs”) for future deliveries of aircraft, net of reimbursements, and paid $2.1 million in maintenance reserves, net of reimbursements.

Fleet

Spirit ended 2012 with 45 aircraft in its fleet. The Company has nine aircraft scheduled for delivery in 2013, including seven new Airbus A320 aircraft and two used A319s.

Copyright Photo: Bruce Drum. Spirit Airlines is expected to retire its last two Airbus A321s (N587NK and N588NK) in 2017. Both are not expected to be repainted in the new colors. A321-231 N587NK (msn 2476) climbs away from the Fort Lauderdale/Hollywood hub.

Spirit Airlines: