Hawaiian Holdings, Inc. (NASDAQ: HA) ("we" or the "Company"), parent company of Hawaiian Airlines, Inc. ("Hawaiian"), today reported its financial results for the third quarter of 2020.

"The COVID-19 pandemic and State of Hawai'i quarantines continued to have a dramatic effect on our business in the third quarter," said Peter Ingram, Hawaiian Airlines President and CEO.  "Despite these monumental challenges, my colleagues throughout the business have done an incredible job adapting to the evolving environment.  We have taken action to reduce expenses, preserve cash, bolster our liquidity and care for our guests, positioning us to begin the recovery process in earnest with the introduction of the State of Hawai'i's pre-travel testing regime in the fourth quarter."

Liquidity and Capital Resources

As of September 30, 2020, the Company had:

• Unrestricted cash, cash equivalents and short-term investments of $979 million
• Outstanding debt and finance lease obligations of $1,299 million
• Air traffic liability of $515 million

Third Quarter 2020

The State of Hawai'i was under mandatory 14-day self-quarantine for all incoming travelers throughout the third quarter of 2020, and for neighbor island travel starting from August 11, 2020 and as a consequence, the Company operated an extremely limited schedule during the third quarter.

During the quarter, the Company implemented both permanent and extended voluntary leave programs with each of its workgroups, and prepared for involuntary reductions effective October 1, 2020.  In total, the Company reduced its workforce by approximately 2,400 employees, or more than 32 percent of all employees, of which almost 2,100 were through voluntary means.

To increase liquidity, the Company closed on approximately $421 million of new financing during the quarter, including:

• Raising approximately $114 million through the sale and leaseback of two Airbus A321neo aircraft
• Raising approximately $262 million through the issuance of Enhanced Equipment Trust Certificates backed by two Airbus A330 aircraft and six Airbus A321neo aircraft
• Drawing approximately $45 million of the $420 million available through the Economic Relief Program ("ERP") loans offered under the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act")

As of September 30, 2020, the Company has received $240.6 million in grants and $60.3 million in loans pursuant to the CARES Act Payroll Support Program ("PSP"), of which $38 million was received in the third quarter.

In October 2020, the Company executed an amendment with the U.S. Treasury increasing the total amount of the ERP loan from $420 million to $622 million, of which $577 million is undrawn; the Company has until March 2021 to determine how much of the remaining ERP funds to borrow.

Guest Experience

During the third quarter, the Company announced the following guest experience improvements:

• Eliminated change fees on all domestic and international flights in order to provide guests with travel flexibility across its network
• Launched a program to offer guests pre-travel COVID-19 testing through mail-in test kits and proprietary drive-through testing labs in select U.S. mainland gateways

In addition, the Company continued its enhanced cleaning procedures and revised guest-facing procedures as part of its health and safety program, which is aligned with current recommendations from leading public health authorities.

The Company currently has limited capacity to 70 percent on its flights through December 15, 2020.

Fourth Quarter 2020

The State of Hawai'i launched a pre-travel testing program for travelers entering the State on or after October 15, 2020.  Travelers who choose to participate in the program can bypass the State's mandatory 14-day quarantine with proof of a negative COVID-19 test from one of the State's approved testing partners.

The Company expects its fourth quarter 2020 capacity to be approximately 70 percent below the capacity flown during the same period last year.  As a significant portion of the Company's costs are fixed, operating expenses are not expected to decline in proportion to the capacity decline.

In October 2020, the Company reached an agreement with Boeing to push back the timing of 787-9 deliveries under its purchase agreement for 10 aircraft.  The Company now expects to take delivery of 787-9 aircraft from 2022 to 2026 with its first aircraft to be delivered in September 2022.

Statistical information, as well as a reconciliation of the non-GAAP financial measures, can be found in the accompanying tables.

Investor Conference Call

Hawaiian Holdings' quarterly results conference call is scheduled to begin today (October 27, 2020) at 4:30 p.m. Eastern Time (USA).  The conference call will be broadcast live over the Internet. Investors may access and listen to the live audio webcast on the investor relations section of the Company's website at HawaiianAirlines.com. For those who are not available for the live webcast, a replay of the webcast will be archived for 90 days on the investor relations section of the Company's website.