Allegiant Travel Co provides travel services in the United States. It sells air transportation on a stand-alone basis or bundled with air-related and third-party services and products. Customers may also purchase fixed-fee flying arrangements to receive charter service on a year-round and ad hoc basis. Additionally, customers may purchase hotel rooms, ground transportation, and other attractions (for example, entertainment show tickets) to accommodate a trip. The company's operating segment includes Airline, Sunseeker Resort, and other non-airlines. Customers purchase travel tickets at airport ticket counters, online, or through its telephone reservation center.
Performance Overview
Allegiant Travel Co (ALGT, Financial) reported a GAAP diluted earnings per share (EPS) of $0.75 for Q2 2024, surpassing the analyst estimate of $0.64. Excluding special charges, the diluted EPS was $1.77. The company also reported total operating revenue of $666.3 million, slightly above the estimated $658.05 million but reflecting a 2.6% decline year-over-year.
Key Financial Metrics
| Metric | Q2 2024 | Q2 2023 | YoY Change |
|---|---|---|---|
| Total Operating Revenue | $666.3M | $683.8M | -2.6% |
| Total Operating Expense | $631.4M | $550.4M | 14.7% |
| Operating Income | $34.9M | $133.4M | -73.8% |
| Net Income | $13.7M | $88.5M | -84.5% |
| Diluted EPS | $0.75 | $4.80 | -84.4% |
Challenges and Strategic Initiatives
Allegiant Travel Co (ALGT, Financial) faced several challenges, including increased operating expenses and special charges related to the Sunseeker Resort and airline operations. The company announced a strategic review of the Sunseeker Resort to realize its full potential value.
"We finished the quarter with diluted earnings per share, excluding special charges, of $1.77," stated Maurice J. Gallagher, Jr., chairman and CEO of Allegiant Travel Company. "Peak period demand trends across our airline business remained strong during the quarter and notably, ancillary outperformed."
Financial Achievements
Despite the challenges, Allegiant Travel Co (ALGT, Financial) achieved significant milestones:
- Total fixed fee contract revenue increased by 50.7% year-over-year to $17.7 million.
- Total average ancillary fare rose by 5.0% year-over-year to $75.34, driven by strength in seats, bags, and cobrand.
- Operating income, excluding specials, was $53.0 million, yielding an adjusted operating margin of 8.0%.
Balance Sheet and Liquidity
As of June 30, 2024, Allegiant Travel Co (ALGT, Financial) had total available liquidity of $1.1 billion, including $851.1 million in cash and investments. The company reported $68.9 million in cash from operations during the second quarter and total debt of $2.2 billion.
Outlook
Looking ahead, Allegiant Travel Co (ALGT, Financial) expects modest growth in the third quarter, with a year-over-year increase in system available seat miles (ASMs) of approximately 1.3%. The company also anticipates receiving its first Boeing aircraft in September, which is expected to enhance operational efficiency and revenue generation.
"We expect the total financial impact from the outage will be approximately $15 million," stated Gregory Anderson, president and incoming CEO of Allegiant Travel Company. "Looking forward to 2025, we are on track to both return to pre-pandemic utilization levels and reduce operating inefficiencies related to Boeing’s delivery delays."
For more detailed financial information, please refer to the full 8-K filing.
Explore the complete 8-K earnings release (here) from Allegiant Travel Co for further details.
