Hawaiian Holdings, Inc. (NASDAQ: HA) (the “Company”), parent company of Hawaiian Airlines, Inc. (“Hawaiian”), today reported its financial results for the second quarter of 2019.
“We’re encouraged by another quarter of strong performance,” said Peter Ingram, Hawaiian Airlines president and CEO. “For the last year and a half, we’ve delivered consistently solid operational and financial results while facing heightened competitive pressures head on. I want to thank the entire Hawaiian ‘ohana for demonstrating day in and day out that no other airline is better suited to serve the needs of guests traveling to, from, and within the Hawaiian Islands than Hawaiian Airlines.”
Statistical information, as well as a reconciliation of the non-GAAP financial measures, can be found in the accompanying tables.
Shareholder Returns, Liquidity and Capital Resources
The Company returned $25.3 million to shareholders in the second quarter through share repurchases of $19.6 million and a dividend payment of $5.7 million.
On July 19, 2019, the Company's Board of Directors declared a quarterly cash dividend of 12 cents per share to be paid on August 30, 2019 to all shareholders of record as of August 16, 2019.
As of June 30, 2019, the Company had:
• Unrestricted cash, cash equivalents and short-term investments of $539 million
• Outstanding debt and finance lease obligations of $565 million
Second Quarter 2019 Highlights
Leadership and People
• Welcomed Justin Doane as Vice President of Labor Relations and David LeNoir Jr. as Vice President of Financial Planning and Analysis.
Operational
• Ranked #1 nationally for on-time performance year-to-date through May 2019 as reported in the U.S. Department of Transportation Air Travel Consumer Report, adding to its record of 15 consecutive years as the most punctual U.S. airline.
• Became the first U.S. airline to adopt the Pacelab Flight Profile Optimizer, a cutting-edge application by software provider PACE that enhances real-time aircraft and weather data to help determine the safest, most comfortable, and efficient flight routes while lowering annual fuel consumption and carbon emissions.
• Announced the expansion of its in-house pilot training capabilities with its planned purchase of a Boeing 787-9 flight simulator to prepare for the arrival of its new Dreamliner fleet beginning early 2021.
Customer Experience
• Debuted a newly designed lobby at Maui’s Kahului Airport (OGG), Hawai‘i’s second busiest airport, as part of its ongoing plans to improve the day-of travel experience for its guests. Similar lobby renovations are expected in 2019 at Kona International Airport (KOA), Hilo International Airport (ITO), and Lihue Airport (LIH).
Routes and Network
• Received a preliminary decision from the U.S. Department of Transportation for additional service from Tokyo Haneda Airport (HND) to Honolulu’s Daniel K. Inouye International Airport (HNL). The additional service, expected to begin in early 2020, will expand Hawaiian’s existing service between Tokyo and Hawai'i that consists of flights between Haneda (HND) and Honolulu (HNL) and Kona (KOA), and Tokyo Narita International Airport (NRT) and Honolulu (HNL).
• Continued its international expansion with the announcement of non-stop service between Fukuoka Airport (FUK) and Honolulu (HNL) beginning November 2019.
• Continued its domestic expansion with the launch of non-stop service between Sacramento International Airport (SMF) and Maui (OGG), and non-stop service between Boston's Logan International Airport (BOS) and Honolulu (HNL).
Fleet & Financing
• Took delivery of one Airbus A321neo aircraft in May, increasing the size of its A321neo fleet to thirteen aircraft.
• Retired its Boeing 717-200 Aircraft Facility with scheduled payments of approximately $45 million, increasing its unencumbered fleet to 37 aircraft.
• On July 1, 2019, Fitch Ratings affirmed Hawaiian’s and the Company’s corporate rating of BB- with Stable outlook.
Third Quarter and Full Year 2019 Outlook
The table below summarizes the Company’s expectations for the third quarter ending September 30, 2019, and the full year ending December 31, 2019, expressed as an expected percentage change compared to the results for the quarter ended September 30, 2018, and the full year ended December 31, 2018, as applicable.
For the full year ending December 31, 2019, the Company expects its effective tax rate to be in the range of 26% to 28%.