Tag Archives: Spirit Airlines

Spirit Airlines expands in Los Angeles, adds third destination in Mexico

Spirit Airlines has announced plans to expand internationally from Los Angeles International Airport (LAX) after two decades of providing high value and low fares domestically. The airline will offer daily flights between LAX and Los Cabos International Airport (SJD) starting May 5, and nonstop flights to Puerto Vallarta’s Licenciado Gustavo Diaz Ordaz International Airport (PVR), starting on July 1.

Spirit will also offer Guests the only nonstop flights from LAX to Columbus (CMH), Milwaukee (MKE), LaGuardia (LGA) and Louisville (SDF), as well as a new nonstop flight to St. Louis (STL), substantially expanding the airline’s flight offerings in Southern California.

New Spirit Airlines Service in Los Angeles

Destination:

Flights Available:

Start Date:

Los Cabos (SJD)

Daily

May 5

  Louisville (SDF)

Daily

  May 27

  St. Louis (STL)

Daily

  May 27

Columbus (CMH)

Daily

June 9

  LaGuardia (LGA)

Saturday Only

 June 12

Milwaukee (MKE)

Daily

June 24

  Puerto Vallarta (PVR)

Daily

  July 1

In 1999, Spirit launched its service in California with flights out of LAX, and later grew to serve Sacramento (SMF), Oakland (OAK) and San Diego (SAN) as well. Recently, Spirit stepped up investments in the LA Basin by adding service to Burbank (BUR) and Orange County (SNA).

In other news, Spirit is expanding on its international growth with new flights from Dallas-Fort Worth, Houston and Los Angeles to Puerto Vallarta.

The airline will offer daily flights between Puerto Vallarta and Los Angeles International Airport (LAX), along with service three times weekly from Houston’s George Bush Intercontinental Airport (IAH) and Dallas-Fort Worth International Airport (DFW) operating on Tuesdays, Thursdays and Sundays.

Spirit Airlines Service to Puerto Vallarta

Destination:

Flights Available:

Start Date:

Los Angeles (LAX)

Daily

July 1

  Dallas-Fort Worth (DFW)

3x Weekly

  July 1

  Houston (IAH)

3x Weekly

  July 1

Spirit will also add nonstop service between LAX and Los Cabos, Mexico (SJD) starting May 5. The route will be Spirit’s first international service from Los Angeles, which will be joined by Puerto Vallarta when it launches the following month.

 

Spirit Airlines adds St. Louis and Pensacola

Spirit Airlines announced plans to add St. Louis Lambert International Airport (STL) to its route map with nonstop daily service to five cities in the Spirit of Lindberg’s historic nonstop flight. The airline plans to start flying on Thursday, May 27, with flights to Fort Lauderdale (FLL), Orlando (MCO), Las Vegas (LAS), Los Angeles (LAX) and Pensacola (PNS).

Flights from St. Louis (STL)

Destination

Flights Available:

Launch Date:

Fort Lauderdale (FLL)

Daily

May 27, 2021

Las Vegas (LAS)

Daily

May 27, 2021

Los Angeles (LAX)

Daily

May 27, 2021

Orlando (MCO)

Daily

May 27, 2021

Pensacola (PNS)

Daily

June 10, 2021

St. Louis is the seventh new city added to Spirit’s network in the past year. The airline continues to seize growth opportunities as demand for air travel increases, having announced new service to Louisville, Milwaukee and Pensacola in the past two weeks.

In other news, the airline announced plans to fly to Pensacola International Airport (PNS) starting on June 10. Spirit will offer the only nonstop flights to Columbus (CMH), Indianapolis (IND) and Louisville (SDF), along with nonstop service Austin (AUS), Dallas-Fort Worth (DFW), Kansas City (MCI) and St. Louis (STL).

Spirit Airlines Service to/from PNS

Destination: 

Flights Available: 

Launch Date: 

Austin (AUS)

Tue/Thu/Sun

June 10, 2021

Columbus (CMH)

Mon/Wed/Fri/Sat

June 11, 2021

Dallas-Fort Worth (DFW)

Daily

June 10, 2021

Indianapolis (IND)

Mon/Wed/Fri/Sat

June 11, 2021

Kansas City (MCI)

Mon/Wed/Fri/Sat

June 11, 2021

Louisville (SDF)

Tue/Thu/Sun

June 10, 2021

St. Louis (STL)

Daily

June 10, 2021

Pensacola is the eighth new city added to Spirit’s network in the past year. The airline continues to seize growth opportunities as demand for air travel increases, having announced new service to Louisville, Milwaukee and St. Louis in the past two weeks. Last month, the carrier announced an accelerated delivery schedule for new Airbus aircraft joining Spirit’s Fit Fleet™, which is among the youngest in the industry.

Spirit Airlines aircraft photo gallery:

Spirit Airlines aircraft slide show:

Spirit Airlines adds three new routes from New York LaGuardia, will split operations

Spirit Airlines has announced flights to three new destinations from LaGuardia Airport (LGA) today. The airline will offer nonstop service to San Juan, Puerto Rico (SJU) starting in April, followed by new flights to Nashville (BNA) in May and Los Angeles (LAX) in June. Spirit is also offering more flexibility to Fort Lauderdale/Hollywood (FLL) with an increase to five flights each day.

Spirit will also begin operating flights out of a second terminal at LaGuardia. The carrier worked with the Port Authority of New York and New Jersey to secure additional space for growth in Terminal A (The Marine Air Terminal). Starting on April 28, 2021, Spirit Airlines departures from LGA will take place from the following terminals:

  • Terminal A: All flights to Fort Lauderdale (five flights each day)
  • Terminal C: Flights to all destinations other than Fort Lauderdale will depart from Terminal C

Spirit Airlines at LaGuardia Airport

Destinations:

Frequency:

Start Date:

San Juan, Puerto Rico (SJU)

Saturday-only

April 17, 2021

Nashville (BNA)

Daily

May 5, 2021

Los Angeles (LAX)

Saturday-only

June 12, 2021

Chicago (ORD)

Up to 2x Daily

Existing Service

Detroit (DTW)

2x Daily

Existing Service

Dallas-Fort Worth (DFW)

1x Daily

Existing Service

Fort Lauderdale (FLL)

5x Daily

Existing Service

Myrtle Beach (MYR)

2x Daily

Existing Service

Orlando (MCO)

Up to 2x Daily

Existing Service

Tampa (TPA)

Up to 1x Daily

Existing Service

 

Spirit is working closely with the Port Authority to add communications and signage to ensure Guests arrive at the appropriate terminal. The airline will temporarily offer a complimentary shuttle service between Terminal A and Terminal C, as well. The shuttle will operate every 15-20 minutes and will run between the hours of 4 a.m. and 7 p.m.

Spirit to start three new routes from Milwaukee

Spirit Airlines has announced that Milwaukee is getting More Go on June 24, when the airline’s yellow and black planes start taking off from Milwaukee Mitchell International Airport (MKE).

Spirit will start up daily nonstop flights to Orlando (MCO), Las Vegas (LAS) and MKE’s only nonstop flight to Los Angeles (LAX).

Spirit Airlines Service to/from MKE:

Destination: 

Flights Available: 

Launch Date: 

Las Vegas (LAS)

Daily

June 24, 2021

Los Angeles (LAX)

Daily

June 24, 2021

Orlando (MCO)

Daily

June 24, 2021

Spirit will be the only airline serving Los Angeles nonstop from Milwaukee, removing intermediate stops on the way and making quick trips between the two cities easier than ever.

Spirit Airlines aircraft photo gallery:

Spirit Airlines aircraft slide show:

Spirit Airlines reports 4Q and 2020 financial results

Spirit Airlines, Inc. reported fourth quarter and full year 2020 financial results.

Ended the year 2020 with $1.9 billion of unrestricted cash, cash equivalents

and short-term investment securities

Fourth Quarter 2020 Fourth Quarter 2019
As Reported Adjusted As Reported Adjusted
(GAAP) (non-GAAP) 1 (GAAP) (non-GAAP) 1
Total Operating Revenues $498.5 million $498.5 million $969.8 million $969.8 million
EBITDA $(87.8) million $(88.8) million $186.5 million $191.5 million
EBITDA Margin  (17.6)%  (17.8)%  19.2%  19.7%
Pre-tax Income (Loss) $(204.5) million $(205.5) million $106.8 million $111.7 million
Net Income (Loss) $(157.3) million $(157.7) million $81.2 million $85.0 million
Diluted Earnings (Loss) Per Share $(1.61) $(1.61) $1.18 $1.24

“Soft demand driven by pandemic-related concerns continues to have a significant impact on our operating results. However, our leading low-cost structure remains a key advantage and positions us well to compete in this environment and beyond. Our load factor and Adjusted EBITDA margin for the fourth quarter 2020 are among the best in the industry, illustrating the strength of our business model,” said Ted Christie, Spirit’s President and Chief Executive Officer. “While the road to recovery is anticipated to be choppy, we are confident we will be among the first U.S. carriers to return to profitability.”

Spirit continues to be recognized for a strong reputation within the airline industry and across all industries. The company’s latest accolade was being named to FORTUNE’s 2021 list of World’s Most Admired® Companies. Spirit is one of only three U.S. airlines included on the list, which surveyed top executives and directors from eligible companies, industry experts and financial analysts.

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 the COVID-19 on its financial position and operations. Please see the Company’s Annual report on Form 10-K for the period ending December 31, 2020 for additional disclosures regarding these measures.

Capacity and Operations
The Company continues to see a significant negative impact to demand for air travel due to the COVID-19 pandemic. Load factor for the fourth quarter 2020 was 71.5 percent on a year-over-year capacity decrease of 25.4 percent.

For the full year 2020, Spirit delivered an outstanding operational performance, with a Completion Factor2 of 97.9 percent and an on-time performance2 of 86.7 percent, as measured by the DOT. For the full year 2020, Spirit expects it will be ranked first in Completion Factor2 and third in on-time performance2 among reporting carriers.

Revenue Performance
Total operating revenues for the fourth quarter 2020 were $498.5 million, a decrease of 48.6 percent year over year as the COVID-19 pandemic continues to severely affect demand for air travel.

For the fourth quarter 2020, total revenue per passenger flight segment (“Segment”) decreased 14.5 percent year over year to $94.64. Fare revenue per Segment decreased 25.6 percent to $39.22 while non-ticket revenue per Segment only decreased 4.5 percent to $55.423.

Cost Performance
For the fourth quarter 2020, total GAAP operating expenses were $658.4 million, a decrease of 22.1 percent year over year. Adjusted operating expenses for the fourth quarter 2020 were $659.4 million4, a decrease of 21.5 percent year over year. These changes were primarily driven by a decrease in both fuel rate and volume compared to the fourth quarter last year. Despite the significant decrease in flight volume compared to the fourth quarter last year, some volume-related expenses increased year over year. For example, landing fees and other rents increased 6.8 percent year over year due to rate increases at various airports Spirit serves; and salaries, wages, and benefits (“SWB”) increased 3.1 percent due to an increase in crew members prior to the hiring freeze that followed the onset of COVID-19 pandemic. The SWB related to additional crew members was partially offset by Team Members who participated in voluntary leave programs.

Fleet
Spirit took delivery of two new A320neo aircraft during the fourth quarter 2020, one of which was debt financed and the other was financed through a sale/leaseback transaction. The Company ended the year with 157 aircraft in its fleet.

Liquidity and Capital Deployment
Spirit ended the year with unrestricted cash, cash equivalents, and short-term investment securities of $1.9 billion. Daily cash burn5 in the fourth quarter 2020 averaged $1.8 million.

Total capital expenditures for the full year 2020 were approximately $537 million (approximately $194 million net of financings).

On December 27, 2020, the Consolidated Appropriations Act, 2021 was signed into law. This new legislation extends the Payroll Support Program (“PSP2”) of the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) through March 31, 2021. In late December, the Company notified the U.S. Department of the Treasury (“Treasury”) of its intent to participate in the PSP2, and entered into an agreement with the Treasury in connection with this PSP2 funding on January 15, 2021. The Company expects to receive approximately $184.5 million pursuant to the PSP2. In January 2021, the Company received the first installment of $92.2 million in the form of a grant. Of the remaining amount, the Company expects that approximately $25 million will be in the form of a low-interest, 10-year loan. Also, in connection with its participation in PSP2, the Company is required to issue warrants to the Treasury to purchase up to 103,761 shares of the Company’s common stock at a strike price of $24.42 per share (the closing price of the shares of the Company’s common stock on December 24, 2020).

“Our fourth quarter Adjusted EBITDA margin of negative 17.81 percent was in line with our revised guidance, with revenue coming in as expected and non-fuel costs coming in slightly better. In the first quarter 2021, we are facing new travel restrictions and state quarantine requirements which have temporarily stalled the demand recovery. In addition, we are seeing a recent rise in fuel prices compared to the fourth quarter 2020. As such, we estimate our first quarter 2021 Adjusted EBITDA margin will be between negative 45 to negative 55 percent, assuming a fuel price per gallon of $1.75,” said Scott Haralson, Spirit’s Chief Financial Officer. “While these short-term developments are frustrating, sentiment is improving and we are well-positioned to succeed as demand recovers.”

Forward Looking Guidance

First Quarter 2021 (1)
Capacity – Available Seat Miles (ASMs) (% Change vs. 1Q19) (2) Down 17%
Adjusted Operating Expenses ($Millions) (3) $740 to $750
Adjusted EBITDA Margin (%) (3) (45)% to (55)%
Fuel Cost per Gallon ($) (4) $1.75
Effective Tax Rate (3)  21%
Full Year 2021 (1)
Total Capital Expenditures ($Millions) (5)
Pre-delivery deposits, net of refunds $105
Other capital expenditures $60 to $85
Estimated Diluted Share Count (1)
If the Company is in a net loss position, average weighted diluted shares is equal to average basic shares outstanding for the period. If the Company records a net profit, it currently uses the Treasury Stock Method to compute the impact from its convertible debt and warrants on the average weighted diluted share count for the period.
Beginning 1/1/22, if the Company records a net profit, per ASU 2020-06, the Company currently expects to use the “If-Converted Method” for its convertible debt. The dilutive impact from the convertible debt under the “If-Converted Method” based on the convertible debt outstanding as of 12/31/20 is 13.7 million shares. The Company anticipates it will continue to use the Treasury Stock Method for the dilutive impact related to outstanding warrants.
Fleet (1)
Expected aircraft deliveries in 2021 16
Expected aircraft deliveries in 2022 17
The Company’s current fleet plan is available at ir.spirit.com.

(1) The 2021 guidance provided in this document is based on the Company’s preliminary estimates of its first quarter and full year 2021 results, which are subject to change in connection with the completion of the Company’s final closing procedures, final adjustments and other developments that may arise in the course of the preparation or audit of its financial statements.
(2) The Company expects that air travel demand will continue to gradually recover in 2021 and continues to closely monitor demand and will make adjustments to the flight schedule as appropriate. However, the situation continues to be fluid and actual capacity adjustments may be different than what the Company currently expects.
(3) Excludes special items which may include loss on disposal of assets, special charges, and other items which are not estimable at this time.
(4) Includes fuel taxes and into-plane fuel cost.
(5) Total Capital Expenditures assumes all aircraft are either delivered under direct leases or financed through Sale/Leaseback transactions. Other capital expenditures are primarily related to aircraft parts, including one spare engine and other spare parts. During the fourth quarter 2020, the Company accelerated 6 aircraft deliveries into 2022 which increased expected net pre-delivery deposits to be paid in 2021 from $40 million to $105 million.

Full Year 2020 Highlights

Our People

  • Spirit avoided involuntary furloughs of its U.S. unionized and non-unionized employees by providing voluntary leave programs and other cost saving initiatives. Due to the high level of support and acceptance of the voluntary programs offered, no unionized employees were involuntarily furloughed and the total number of non-unionized Team Members involuntarily separated as of October 1, 2020 was reduced by more than 95%;
  • Implemented a Human Rights Policy seeking to build human rights awareness among our Team Members and our Guests; and
  • Furthered its commitment to diversity by developing a comprehensive Diversity, Inclusion, Equity and Belonging Initiative to launch in 2021, to drive meaningful change within the organization. This includes a new Supplier Diversity program around a network of minority-owned business partners and diverse suppliers, as part of our strategic sourcing and procurement process.

Recognitions and Accomplishments

  • Spirit was one of only three U.S. airlines listed on FORTUNE’s 2021 list of World’s Most Admired® Companies;
  • Moved up one spot to 4th place in the 2020 edition of the Middle Seat Scorecard, the Wall Street Journal’s annual ranking of U.S. airlines by operational performance; and
  • For the full year 2020, Spirit expects it will be ranked 1st in Completion Factor2 and 3rd in on-time performance2 among DOT reporting carriers.

Guest Experience and Loyalty

  • Spirit implemented efforts to meet or exceed guidelines and rules published by the Centers for Disease Control (“CDC”). Spirit requires all Guests to complete a Health Acknowledgement at check-in, requires Guests and Team Members to wear face coverings throughout their journey, has implemented enhanced cleaning protocols, has updated airport and inflight procedures, and more;
  • Leveraged its technology-driven solutions like automated self-bag tagging and self-bag drop, minimizing face-to-face interaction and enabling Guests to self-serve their check-in experience;
  • Launched the nation’s first check-in experience powered by biometric photo-matching, debuting new protocols developed for domestic air travel;
  • Deployed bag scanning technology to reduce mishandled baggage occurrences and improve accuracy across all airports; and
  • Unveiled a redesigned Free Spirit® Loyalty Program with extended points expiration, additional benefits based on status, and other changes that began January 21, 2021. In addition, the new Spirit Saver$ Club®, formerly known as the $9 Fare Club™, expanded on existing fare discounts by providing savings on seats, shortcut boarding and security, and other options designed to make it the best value in the sky.

Supporting our Communities

  • Spirit helped more than 30,000 Guests return home to their families and loved ones under times of uncertainty due to the pandemic. In partnership with government officials in the U.S., Latin America, and the Caribbean, we organized and operated flights between U.S. and Colombia, Honduras, Panama, Aruba, Haiti, Ecuador, Costa Rica, the Dominican Republic and St. Martin;
  • Pledged $250,000 worth of airline travel to nine organizations across the U.S., advocating for social justice and civil rights;
  • The Spirit Airlines Charitable Foundation (the “Foundation”) raised over $1,000,000 in its annual fund raising efforts helping to support initiatives that include Aviation and STEM education scholarships and other education, family and military service projects throughout the communities it serves; and,
  • In addition, through the Foundation, Spirit contributed to efforts to address other needs in its communities. As part of its focus on supporting families, the Foundation partnered with other non-profit organizations including the YMCA and Jack and Jill Children’s Center to provide food to Seniors and families in need. Additionally, Spirit supported the production of face coverings for first responders and healthcare workers throughout the pandemic. The Company also raised funds for the American Red Cross, by selling face coverings to Guests at the gates and onboard our aircraft. Among many other initiatives to benefit the communities it serves, Spirit also partnered with Susan G. Komen Organization by raising funds through the sale of branded Breast Cancer Awareness scarves and ties with all proceeds benefiting the charities supported through the Foundation.

Measures Taken to Preserve Cash and Enhance Liquidity

In response to the COVID-19 pandemic crisis that drastically affected the Company’s original 2020 plan, Spirit took several steps to preserve and enhance its liquidity and to protect the long-term sustainability of the Company, including but not limited to, the following:

  • Reduced planned discretionary non-aircraft capital spend in 2020 by more than $70 million;
  • Reduced 2020 planned non-fuel operating costs by approximately $30 million excluding savings related to reduced capacity;
  • Entered into a two-year senior secured revolving credit facility in March 2020 (the “2022 RCF”). As of December 31, 2020, the available amount under the 2022 RCF was $180 million, which was fully drawn;
  • Completed the public offering of $175.0 million aggregate principal amount ($168.3 million in proceeds, net of issuance costs) of 4.75% convertible senior notes due 2025;
  • Completed a primary public offering of 20,125,000 shares of its voting common stock. The Company received proceeds of $192.4 million, net of issuance costs, from this stock offering;
  • Completed a private offering of an aggregate of $850 million principal amount of 8.00% senior secured notes due 2025, guaranteed by Spirit’s loyalty program and brand intellectual property. The Company received proceeds of $823.9 million, net of issuance costs, related to this private offering;
  • 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; and
  • Received $344.4 million in PSP funds through the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”).

New Destinations

  • During 2020, Spirit launched new service to Barranquilla, Colombia; Bucaramanga, Colombia; Cap-Haitien, Haiti; and Orange County, California.

Spirit Airlines introduces a Brett Young Music logo jet on N932NK, will split its operations center

Spirit Airlines has introduced a new Brett Young Music logo jet (N932NK) to celebrate its new partnership with the artist and Mastercard.

The airline announced on social media:

We’re celebrating the new Free Spirit® with a free virtual concert in partnership with Mastercard at 8pm EST on February 4, 2021.

In other news, Spirit Airlines announced it will split its flight operations center at company headquarters in Miramar, moving 40 percent of its staff to a hurricane-hardened facility at Orlando International Airport according to the Orlando Sentinel.

Spirit Airlines brings back international service from Orlando with six routes launching in December

Spirit Airlines made this announcement:

Spirit Airlines will head back to Latin America from Orlando just in time for the holidays. The Florida-based carrier is re-launching six nonstop international routes.

Spirit plans to reintroduce Latin American destinations from Orlando International Airport (MCO) gradually throughout the month of December, beginning with service to Colombia and Honduras. Within weeks, the airline will add Mexico, Guatemala and El Salvador along with additional Colombian flights.

In the Caribbean, people travelling to Puerto Rico will have more options at the beginning of 2021. Spirit plans to reactivate its service to Aguadilla (BQN) once the airport re-opens in January. Daily flights to the island’s northwestern tip will complement Spirit’s existing service to San Juan (SJU), which runs up to five times each day.

Caribbean & Latin American Service at MCO
Destination Flights Available: Launch Date :
Bogota (BOG) 4x weekly Dec. 4, 2020
San Pedro Sula (SAP) 3x weekly Dec. 4, 2020*
Cartagena (CTG) 3x weekly Dec. 16, 2020
Cancun (CUN) 6x weekly Dec. 16, 2020
Guatemala City (GUA) 3x weekly Dec. 16, 2020
San Salvador (SAL) 2x weekly Dec. 19, 2020
Aguadilla (BQN) 1x daily Jan. 6, 2021
San Juan (SJU) Up to 5x per day Existing Service
St. Thomas (STT) 4x weekly Existing Service

* Pending re-opening of the airport following repairs due to damage from Hurricane Eta .

Spirit carried 2.6 million Guests at MCO in 2019. The airline reactivated most of its domestic network from the airport in July as the demand for air travel began to rebound. Resuming international service at MCO bumps up Spirit’s operation at the airport to 38 nonstop destinations throughout the United States, Latin America and the Caribbean. The airline will offer Guests an average of 53 flights each day during the December travel period. That’s a ten-fold increase compared to the five flights available each day when demand for air travel was at its lowest in 2020.

Spirit started serving MCO in 1993 and grew into one of Central Florida’s major job providers. The airline employs nearly 1,200 people in the Orlando area directly, and its operations support another 500 contractors in the region.

In other news, the airline is also adding two new cities officially joining its route map. The carrier’s signature yellow planes brought some extra sunshine when they launched service to Bucaramanga (BGA) on November 18 and Barranquilla (BAQ) on November 19. Both routes run nonstop from the Fort Lauderdale-Hollywood International Airport (FLL).

Spirit’s service to Bucaramanga is the only nonstop flight connecting Colombia’s Santander region with the United States. Adding Bucaramanga and Barranquilla to Spirit’s network means the airline serves more Colombian cities nonstop than any other U.S. carrier.

Routes & Frequencies 

Fort Lauderdale (FLL) to/from: 

Starts: 

Frequency: 

Bucaramanga (BGA) 

November 18, 2020 

3x Weekly

Barranquilla (BAQ)  

November 19, 2020 

3x Weekly

Armenia (AXM) 

Existing Service

3x Weekly

Cartagena (CTG) 

Existing Service

4x Weekly 

Bogota (BOG) 

  Existing Service

1x Daily 

Medellin (MDE) 

  Existing Service

1x Daily 

Cali (CLO) 

  Existing Service

1x Daily 

On Sept. 19, Spirit became the first international airline to return to Colombia when one of its planes landed in Cartagena after six months of border closures. The airline also led humanitarian efforts before the country re-opened by arranging more than 170 flights between Colombia and the U.S. and helping more than 30,000 people reunite with their families and loved ones.

More than 3.1 million Guests have chosen Spirit to travel between Colombia and the U.S. in the past 12 years. The airline started service to Colombia in May 2008 with flights between Fort Lauderdale and Cartagena (CTG). Spirit’s expansion continued over the next decade with flights to Bogota (BOG), Medellin (MDE), Armenia (AXM) and Cali (CLO). The airline also added nonstop service from Orlando (MCO) to Cartagena, Bogota and Medellin.

Route Map:

Spirit Airlines announces more flights at Orange County

Spirit Airlines made this announcement:

Spirit Airlines’ bright yellow planes are about to touch down at John Wayne Airport (SNA), and more flights are already on the way. The airline announced plans for more service to the airport in 2021 with a second daily flight to Las Vegas (LAS) and new nonstop service to Phoenix (PHX).

SNA will become the newest dot on Spirit’s route map on November 17, when the airline launches its previously announced daily flight to LAS and twice-daily service to Oakland (OAK). Orange County recently awarded Spirit additional takeoff and landing rights for 2021, which allowed for the expansion to PHX and additional flying to LAS.

Spirit Airlines at SNA

Destination Flights Available: Launch Date:
Oakland (OAK) 2x daily Nov. 17, 2020
Las Vegas (LAS) 2x daily Nov. 18, 2020*
Phoenix (PHX) 1x daily Jan. 6, 2021

*Second daily flight begins Jan. 6, 2021

Spirit touched down in California more than 20 years ago with its first flight to Los Angeles (LAX), launching two decades of growth across the Golden State. In the years that followed, the airline expanded its options for Guests in the L.A. basin with service to Burbank (BUR), and grew to serve Sacramento (SMF), Oakland (OAK) and San Diego (SAN) as well.

 

Guest Safety

Spirit’s commitment to Safe Travels includes a multi-layered safety approach that requires all Guests and Team Members to wear face coverings. Each passenger agrees to that policy as part of a health and safety acknowledgement prior to boarding the aircraft. Every plane in our Fit Fleet® uses state-of-the-art, high-efficiency particulate air (HEPA) filters that capture 99.97% of particles and filter the air for contaminants every 3 minutes.

Between each flight, enhanced cleaning procedures focus on high-touch areas such as tray tables and armrests using hospital-grade disinfectants. Spirit also uses two EPA-registered fogging treatments. The first applies a safe, high-grade disinfectant that’s effective against coronaviruses. The second uses an antimicrobial product that forms an invisible barrier on all surfaces that kills bacteria and viruses on contact for 30 days. Please visit Spirit’s COVID-19 Information Center for more information on safety enhancements.

Spirit Airlines 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 $401.9 million $992.0 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 $51.373.

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: