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Hawaiian Holdings (HA) Posts Wider-Than-Expected Q1 Loss

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Hawaiian Holdings, Inc.’s HA first-quarter 2021 loss (excluding $2.62 from non-recurring items) of $3.85 per share was wider than the Zacks Consensus Estimate of a loss of $3.71. Notably, the company reported a loss of 74 cents in the year-ago quarter.

Moreover, quarterly revenues of $182.2 million declined 67.4% year over year and missed the Zacks Consensus Estimate of $185 million.

Hawaiian Holdings, Inc. Price, Consensus and EPS Surprise

Hawaiian Holdings, Inc. Price, Consensus and EPS Surprise
Hawaiian Holdings, Inc. Price, Consensus and EPS Surprise

Hawaiian Holdings, Inc. price-consensus-eps-surprise-chart | Hawaiian Holdings, Inc. Quote

Despite being on the path of recovery from the COVID-19 challenges, passenger revenues (contributing 75.5% to the top line) declined 72.7% year over year to $137.5 million. Airline traffic, measured in revenue passenger miles, fell 71.6% year over year to 1,054.1 million in the quarter under review. Capacity (measured in available seat miles) contracted 50.4% to 2,466 million. Load factor (percentage of seats filled by passengers) deteriorated 3190 basis points to 42.7% in the reported quarter as traffic plunge outweighed capacity contraction. Passenger revenue per ASM (PRASM) plunged 45% to 5.57 cents.

Operating revenue per available seat mile (RASM: a key measure of unit revenues) in the quarter plunged 34.6% year over year to 7.34 cents for total operations. Average fuel cost per gallon (economic) dropped 12.6% to $1.60 in the first quarter. With majority of the fleet grounded, gallons of jet fuel consumed declined 53.1% in the March-end quarter.

Liquidity

As of Mar 31, 2021, Hawaiian Holdings’ unrestricted cash, cash equivalents and short-term investments totaled $1.9 billion. Outstanding debt and finance lease obligations were $2.1 billion.

Q2 Outlook

Capacity (or ASMs) is anticipated to go down 30-33% from second-quarter 2019 levels.

Total revenue is anticipated to plunged 45-50% from second-quarter 2019 levels.

Operating expenses (excluding non-recurring items) is expected to decline 20-24% from second-quarter 2019 levels.

Interest expense is expected to be at $30 million in the June-end quarter.

Adjusted EBITDAR is expected to fall between $70 million to $20 million.

Effective tax rate is anticipated to be at 21% in the second quarter.

Fuel price per gallon is expected to be at $1.75 for the second quarter of 2021.

2021 Outlook

For the current year, the company expects its capital expenditures to be approximately $50-$60 million.

Zacks Rank

Hawaiian Holdings currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Sectorial Snapshot

Within the broader Transportation sector, Delta Air Lines DAL, J.B. Hunt Transport Services JBHT and Kansas City Southern KSU recently reported first-quarter 2021 results.

Delta, carrying a Zacks Rank #3, incurred a loss (excluding $1.70 from non-recurring items) of $3.55 per share. The figure was wider than the Zacks Consensus Estimate of a loss of $3.08. Total revenues of $4,150 million topped the Zacks Consensus Estimate of $3,821.3 million.

J.B. Hunt, a Zacks #3 ranked player, reported earnings of $1.37 per share. The figure beat the Zacks Consensus Estimate of $1.18. Total operating revenues of $2,618.1 million also surpassed the Zacks Consensus Estimate of $2,486.9 million.

Kansas City Southern, carrying a Zacks Rank of 3, reported earnings (excluding 23 cents from non-recurring items) of $1.91 per share. The figure missed the Zacks Consensus Estimate of $2. Quarterly revenues of $706 million lagged the Zacks Consensus Estimate of $714.3 million.

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