Yahoo Finance Hawaiian Holdings Inc (HA) (Q1 2024) Earnings Call Transcript Highlights: Navigating Through ...
Total Revenue: Increased by 5.4%.
Capacity: Grew by 2.7% compared to the same period in 2023.
Resin (Revenue per Available Seat Mile): Up 2.6% year-over-year.
Ancillary Revenue: From Extra Comfort and preferred seat products up 16% year-over-year.
Adjusted EBITDA: Loss of $116 million.
Adjusted Loss Per Share: $2.77, includes impact of $0.32 per share due to a change in effective tax rate.
Effective Tax Rate: Reduced from 21% to 10%.
Unit Costs Excluding Fuel and Special Items: Expected to be about 6.5% higher in Q2 2023 compared to the same period in 2023.
Full Year Capacity Forecast: ASMs expected to be up about 6%.
Release Date: April 23, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: Can you unpack the resin forecast a bit, especially regarding the competitive landscape in the inter-island market and off the West Coast, and the issues with Japan? A: Peter Ingram, President and CEO, explained that moving from Q1 to Q2, there's an increase in international capacity which challenges the environment, especially with Japan. However, the North American market maintains a similar trend rate adjusting for the Easter shift. The Neighbor Island segment shows improvement into Q2, potentially even better towards the end of the quarter.
Q: Regarding hiring, do you need to hire more to fill the capacity plan, or do you have enough staff for 2024? A: Brent Overbeek, EVP & Chief Revenue Officer, noted that hiring continues but at a slower pace than the past two years. The company is preparing for new aircraft deliveries and has done some hiring for this, but overall, the hiring environment is stabilizing.
Q: How are you handling the unit costs with the new freighter operations? A: Shannon Okinaka, CFO, mentioned that currently, all costs are integrated into CASM as the freighter operation is still relatively small. As it grows, they might provide more breakdown of the direct costs associated with this operation.
Q: Can you discuss the premium revenue potential of the 787 compared to the A330? A: Peter Ingram highlighted that the 787 features a superior business class product, which should significantly enhance premium revenue, especially as the fleet and its operations expand.
Q: What is the impact of the full A321 fleet returning to service, including engines from overhaul visits? A: Peter Ingram clarified that while the global shortage of engines persists, Hawaiian is in a relatively good position with several engines returning from overhaul. This situation should help stabilize operations and reduce costs associated with deploying larger aircraft on routes suited for A321s.
Q: How do you view the revenue environment and the path back to profitability given various market challenges? A: Peter Ingram expressed confidence in the strategic steps being taken, such as investments in new aircraft and initiatives like the freighter operation. He acknowledged the need for some environmental factors to improve, particularly in Japan, but overall, he is optimistic about the direction and the impact of recent investments.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
