ALLEGIANT TRAVEL COMPANY FIRST QUARTER 2023 FINANCIAL RESULTS

First quarter 2023 GAAP diluted earnings per share of $3.09

First quarter 2023 diluted earnings per share, excluding Sunseeker special charges of $3.04⁽¹⁾⁽⁴⁾

First quarter 2023 airline only diluted earnings per share of $3.30⁽¹⁾

LAS VEGAS, May 3, 2023 /PRNewswire/ — Allegiant Travel Company (NASDAQ: ALGT) today reported the following financial results for the first quarter 2023, as well as comparisons to the prior year:

“I am happy to report we delivered strong financial results during the first quarter with diluted earnings per share of $3.09,” stated John Redmond, CEO of Allegiant Travel Company. “The team worked tirelessly to ensure operational integrity, and our controllable completion of 99.9 percent for the quarter is a testament to their efforts. Running a safe, reliable operation is a critical component to our success, and I could not be prouder of the team’s performance.

“Demand remained strong throughout the quarter resulting in total operating revenue of $650 million, a 30 percent increase year-over-year. Notably, we see continued momentum in total ancillary per passenger, finishing the quarter at $75.19 per passenger, the highest quarterly result in our history. The Allways rewards credit card helped elevate this number with record new cardholder acquisitions and increased cardholder spend during the quarter. Enhanced technology, an expanded roll-out of Allegiant Extra in the fleet, and the opening of Sunseeker Resort later this year should act as tailwinds for this number in the coming years.

“Turning to our 2023 outlook, we have updated guidance and estimate a full-year, airline-only earnings per share of roughly $11. The increase is driven by a reduction in our estimated fuel cost per gallon offset slightly by a two-and-a-half point reduction in full-year capacity. The industry continues to experience challenges from supply chain delays to ATC constraints that present the most stress during peak, high demand periods. We are positioning our forward plan to achieve a full-year, controllable completion of at least 99.5 percent. And we will continue to monitor and respond as we see appropriate to achieve our goal. Despite the tweaks to capacity, booking data continues to reflect a strong demand environment, particularly during peak summer travel periods. We are closely monitoring macro-economic trends, but we have not observed a change in booking behavior or peak leisure demand.

“Finally, we remain on track to open Sunseeker Resort in mid-October. Although we are still working through insurance claims related to Hurricane Ian, we have better line of sight regarding completion and final budget. Given inflationary pressures and supply chain issues, we expect the final capital expenditure budget to be $695 million, which is inclusive of Aileron Golf Club. In early April, we unveiled the 20 original, world-class food and beverage offerings, which will be available on site. The team continues to attract high-quality group business with over $12 million in contracted future bookings. As we enter the final stages of construction, we could not be happier with how the property is progressing.”                     

First Quarter 2023 Results

• Income before income tax of $74.4 million, yielding a pre-tax margin of 11.5 percent
• Airline-only income before income tax⁽¹⁾ of $78.9 million, yielding a pre-tax margin of 12.1 percent
• Operating income of $94.8 million, yielding an operating margin of 14.6 percent
• Airline-only operating income⁽¹⁾ of $97.6 million, yielding an airline-only operating margin of 15.0 percent
• Consolidated EBITDA⁽¹⁾ of $149.5 million, yielding an EBITDA margin of 23.0 percent
• Airline-only EBITDA⁽¹⁾ of $152.2 million, a 23.4 percent margin
• Total operating revenue was $649.7 million, up 29.9 percent over prior year
• Total fixed fee contracts revenue of $14.1 million, the highest first-quarter total in company history
• TRASM of 13.89 cents, up 28.8 percent year-over-year
• Load factor of 85.8 percent, a 6.9 point improvement year-over-year, among the highest in the industry
• Total average fare of $154.12, up 17.5 percent year-over-year, the highest quarterly average fare in company history
• Total average ancillary fare of $75.19, up 10.7 percent as compared to 2022 driven by overall strength in core products and promising early results related to the Allegiant Extra rollout
• Acquired over 46 thousand new Allways rewards credit card holders during the quarter, the highest quarterly acquisition in program history
• Received $28 million in remuneration during the quarter
• Airline-only Operating CASM, excluding fuel, of 7.75 cents, up 9.8 percent year-over-year
• Allegiant recently named to the Forbes’ America’s Best Midsize Employers for 2023, Newsweek’s America’s Greatest Workplaces for Diversity 2023, and Fortune’s America’s Most Innovative Companies 2023 lists

Balance Sheet, Cash and Liquidity

• Total available liquidity at March 31, 2023 of $1.5 billion, which includes $1.1 billion in cash and investments, and $412.2 million in undrawn revolving credit facilities and PDP facilities
• Repurchased 118 thousand shares during the first quarter at an average share price of $100.33
• $215.4 million in cash from operations during first quarter 2023, the highest first quarter in company history
• Total debt at March 31, 2023 was $2.1 billion
• Net debt at March 31, 2023 was $1.0 billion
• Debt principal payments of $51.5 million during the first quarter
• Air traffic liability at March 31, 2023 was $479.5 million

Airline Capital Expenditures

• First quarter capital expenditures of $92 million, which includes $56 million for aircraft purchases and inductions, pre-delivery deposits, and other related costs, and $36 million in other airline capital expenditures
• First quarter deferred heavy maintenance spend was $15 million

Sunseeker Resort Charlotte Harbor

• Total capital expenditures⁽¹⁾ as of March 31, 2023 were $571 million
• First quarter capital expenditures⁽¹⁾ were $82 million
• Previously recorded special charges were reduced by $1.6 million for approved insurance net recoveries related to outstanding insurance claims at Sunseeker Resort

The table above is provided based on the company’s current plans and is subject to change. The numbers exclude aircraft expected to be delivered before the end of 2023 for revenue service beginning in 2024

Allegiant Travel Company will host a conference call with analysts at 12:30 p.m. ET Wednesday, May 3, 2023 to discuss its first quarter 2023 financial results. A live broadcast of the conference call will be available via the Company’s Investor Relations website homepage at http://ir.allegiantair.com. The webcast will also be archived in the “Events & Presentations” section of the website.

Allegiant Travel Company

Las Vegas-based Allegiant (NASDAQ: ALGT) is an integrated travel company with an airline at its heart, focused on connecting customers with the people, places and experiences that matter most. Since 1999, Allegiant Air has linked travelers in underserved cities to world-class vacation destinations with all-nonstop flights and industry-low average fares. Today, Allegiant serves communities across the nation, with base airfares less than half the cost of the average domestic round trip ticket. For more information, visit us at Allegiant.com. Media information, including photos, is available at http://gofly.us/iiFa303wrtF.

Media Inquiries: [email protected]

Investor Inquiries: [email protected]

Under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, statements in this press release that are not historical facts are forward-looking statements. These forward-looking statements are only estimates or predictions based on our management’s beliefs and assumptions and on information currently available to our management. Forward-looking statements include our statements regarding future airline operations, revenue, expenses and earnings, available seat mile growth, expected capital expenditures, the cost of fuel, the timing of aircraft acquisitions and retirements, the number of contracted aircraft to be placed in service in the future, our ability to consummate announced aircraft transactions, the implementation of a joint alliance with Viva Aerobus, the capital expenditures budget for completion of our Sunseeker Resort, as well as other information concerning future results of operations, business strategies, financing plans, industry environment and potential growth opportunities. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words “believe,” “expect,” “guidance,” “anticipate,” “intend,” “plan,” “estimate”, “project”, “hope” or similar expressions.

Forward-looking statements involve risks, uncertainties and assumptions. Actual results may differ materially from those expressed in the forward-looking statements. Important risk factors that could cause our results to differ materially from those expressed in the forward-looking statements generally may be found in our periodic reports filed with the Securities and Exchange Commission at www.sec.gov. These risk factors include, without limitation, the impact of Hurricane Ian on our Florida markets and completion of Sunseeker Resort, the impact and duration of the COVID-19 pandemic on airline travel and the economy, an accident involving, or problems with, our aircraft, public perception of our safety, our reliance on our automated systems, our reliance on third parties to deliver aircraft under contract to us on a timely basis, risk of breach of security of personal data, volatility of fuel costs, labor issues and costs, the ability to obtain regulatory approvals as needed , the effect of economic conditions on leisure travel, debt covenants and balances, the impact of government regulations on the airline industry, the ability to finance aircraft to be acquired, the ability to obtain necessary government approvals to implement the announced alliance with Viva Aerobus and to otherwise prepare to offer international service, terrorist attacks, risks inherent to airlines, our competitive environment, our reliance on third parties who provide facilities or services to us, the impact of management changes and the possible loss of key personnel, economic and other conditions in markets in which we operate, the ability to successfully develop a resort in Southwest Florida, increases in maintenance costs, cyclical and seasonal fluctuations in our operating results, and the perceived acceptability of our environmental, social and governance efforts.

Any forward-looking statements are based on information available to us today and we undertake no obligation to update publicly any forward-looking statements, whether as a result of future events, new information or otherwise.

Detailed financial information follows:

Summary Balance Sheet

EPS Calculation

The following table sets forth the computation of net income per share, on a basic and diluted basis, for the periods indicated (share count and dollar amounts other than per-share amounts in table are in thousands):

Appendix A
Non-GAAP Presentation
Three Months Ended March 31, 2023
(Unaudited)

Airline operating revenue, airline operating expense, airline operating income, airline income before income taxes, airline net income, and airline diluted earnings per share all eliminate the effects of non-airline operating activity, which is not reflective of the airline operating performance. Airline earnings before interest, taxes, depreciation and amortization (“Airline EBITDA”) eliminates the effects of non-airline operating activity and other items. As such, all of these are non-GAAP financial measures. We believe the presentation of these measures is relevant and useful for investors because it allows them to better gauge the performance of the airline and to compare our results to other airlines.

EBITDA and Airline-only EBITDA, as presented in this press release, are supplemental measures of our performance that are not required by, or presented in accordance with, accounting principles generally accepted in the United States (“GAAP”). These are not measurements of our financial performance under GAAP and should not be considered in isolation or as an alternative to net income or any other performance measures derived in accordance with GAAP or as an alternative to cash flows from operating activities as a measure of our liquidity.

We define “EBITDA” as earnings before interest, taxes, depreciation and amortization. We also adjust EBITDA within this release to exclude non-airline activity. We caution investors that amounts presented in accordance with this definition may not be comparable to similar measures disclosed by other issuers, because not all issuers and analysts calculate EBITDA in the same manner.

We use EBITDA and Airline EBITDA, to evaluate our operating performance and liquidity and these are among the primary measures used by management for planning and forecasting of future periods. We believe these presentations of EBITDA are relevant and useful for investors because they allow investors to view results in a manner similar to the method used by management and makes it easier to compare our results with other companies that have different financing and capital structures. EBITDA has important limitations as an analytical tool. These limitations include the following:

• EBITDA does not reflect our capital expenditures, future requirements for capital expenditures or contractual commitments to purchase capital equipment;
• EBITDA does not reflect interest expense or the cash requirements necessary to service principal or interest payments on our debt;
• although depreciation and amortization are non-cash charges, the assets that we currently depreciate and amortize will likely have to be replaced in the future, and EBITDA does not reflect the cash required to fund such replacements; and
• other companies in our industry may calculate EBITDA differently than we do, limiting its usefulness as a comparative measure.

Presented below is a quantitative reconciliation of these EBITDA numbers to the most directly comparable GAAP financial performance measure, which we believe is net income.

The SEC has adopted rules (Regulation G) regulating the use of non-GAAP financial measures. Because of our use of non-GAAP financial measures in this press release to supplement our consolidated financial statements presented on a GAAP basis, Regulation G requires us to include in this press release a presentation of the most directly comparable GAAP measure, which is operating revenue, operating expenses, operating income, income before income taxes, net income, and net income per share and a reconciliation of the non-GAAP measures to the most comparable GAAP measure. Our utilization of non-GAAP measurements is not meant to be considered in isolation or as a substitute for operating revenue, operating expenses, operating income, income before income taxes, net income, net income per share, or other measures of financial performance prepared in accordance with GAAP. Our use of these non-GAAP measures may not be comparable to similarly titled measures employed by other companies in the airline and travel industry. The reconciliation of each of these measures to the most comparable GAAP measure for the periods is indicated below.

SOURCE Allegiant Travel Company

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