Attached files
| file | filename |
|---|---|
| 8-K - 8-K - Spirit Airlines, Inc. | form8-kinvestorupdate72415.htm |
Exhibit 99.1
Investor Update
July 24, 2015
This investor update provides Spirit's third quarter and full year guidance for the year ending December 31, 2015. All data is based on preliminary estimates.
Our booking period averages less than 50 days; as such, our visibility into revenue trends beyond that is limited. Our forecast assumes current pricing and booking trends continue for the remainder of the year.
Capacity - Available Seat Miles (ASMs) | 1Q15A | 2Q15A | 3Q15E | 4Q15E | FY2015E | ||||||||||
ASMs (millions) | 4,729 | 5,213 | 5,617 | 5,739 | 21,299 | ||||||||||
Year-over-Year % Change | 25.0 | % | 30.1 | % | 34.6 | % | 31.3 | % | 30.3 | % | |||||
3Q15E | FY2015E | |||||||||
Operating Margin(1) | 22.0 | % | - | 25.0% | 21.5 | % | - | 23.0% | ||
Operating Expense per ASM (CASM) (cents) | ||||||||||
Adjusted CASM(1) | 7.77 | - | 7.89 | 7.91 | - | 7.97 | ||||
Less: Economic fuel expense per ASM(2) | 2.35 | 2.38 | ||||||||
Adjusted CASM ex-fuel(3) | 5.42 | - | 5.54 | 5.53 | - | 5.59 | ||||
Average Stage Length (miles) | 988 | 990 | ||||||||
Fuel Expense ($) | ||||||||||
Fuel gallons (thousands) | 67,135 | 253,421 | ||||||||
Economic fuel cost per gallon(2) | $1.97 | $2.00 | ||||||||
Selected Operating Expenses ($Millions) | ||||||||||
Aircraft rent | $53.6 | $214.2 | ||||||||
Depreciation and amortization | $20.7 | $75.6 | ||||||||
. | ||||||||||
Interest Expense, net of Capitalized Interest ($Millions) | ||||||||||
Interest expense | $6.3 | $21.1 | ||||||||
Capitalized interest | (3.1) | (11.7) | ||||||||
Interest Expense, net of Capitalized Interest | $3.2 | $9.4 | ||||||||
Effective Tax Rate | 37% | 37% | ||||||||
Wtd. Average Share Count (Millions) | ||||||||||
Basic | 72.1 | 72.4 | ||||||||
Diluted | 72.4 | 72.7 | ||||||||
1
Full Year 2015E | ||||||
Capital Expenditures | ($Millions) | |||||
Aircraft capital expenditures(4) | $ | 620 | ||||
Other capital expenditures(5) | 67 | |||||
Gross capital expenditures(4) | $ | 687 | ||||
Anticipated proceeds from issuance of long term debt and sale/leaseback transactions | $ | 545 | ||||
Other Working Capital Requirements | ||||||
Payments for heavy maintenance events(6) | $ | 19 | ||||
Pre-delivery deposits for flight equipment, net of refunds | $ | 114 | ||||
Pre-paid maintenance deposits, net of reimbursements | $ | 23 | ||||
Fuel Hedges | |||
Period | % of Est. Volume | Instrument | Avg. Price / Gallon |
3Q15 | 24% | USGC Jet Call Options | $1.90 |
4Q15 | 23% | USGC Jet Call Options | $1.92 |
Footnotes
(1) | Excludes special items which may include unrealized gains or losses related to fuel derivative contracts, loss on disposal of assets, and special charges or credits. Includes realized gains or losses related to fuel derivative contracts. |
(2) | Includes fuel taxes, into-plane fuel cost, and realized gains and losses related to fuel derivative contracts. |
(3) | Excludes all components of fuel expense, loss on disposal of assets, and special charges or credits. |
(4) | Includes amounts related to 14 aircraft scheduled for delivery in 2015, including $152 million that was funded as pre-delivery deposits in prior years that is held by the aircraft manufacturer. The Company has 15 aircraft scheduled for delivery in 2015. The Company has debt commitments for the first 11 aircraft delivering in 2015 and assumes it will debt finance 3 additional aircraft and direct lease 1 aircraft from a third-party. |
(5) | Includes the purchase of a spare engine. |
(6) | Payments for heavy maintenance events are recorded as Long-term deposits and other assets within "Changes in operating assets and liabilities," on the Company's cash flow statement. |
2
Spirit Airlines, Inc. | ||||||||||||||||||||
Aircraft Delivery Schedule (net of Scheduled Retirements) as of February 10, 2015 | ||||||||||||||||||||
A319 | A320 CEO | A320 NEO | A321 CEO | A321 NEO | Total | |||||||||||||||
Total Year-end 2014 | 29 | 34 | — | 2 | — | 65 | ||||||||||||||
1Q15 | — | 5 | — | — | — | 5 | ||||||||||||||
2Q15 | — | 3 | — | — | — | 3 | ||||||||||||||
3Q15 | — | — | — | 3 | — | 3 | ||||||||||||||
4Q15 | — | — | 1 | 3 | — | 4 | ||||||||||||||
Total Year-end 2015 | 29 | 42 | 1 | 8 | — | 80 | ||||||||||||||
1Q16 | (1 | ) | — | 1 | 3 | — | 3 | |||||||||||||
2Q16 | (2 | ) | 1 | 1 | 2 | — | 2 | |||||||||||||
3Q16 | — | 1 | 2 | 2 | — | 5 | ||||||||||||||
4Q16 | — | 1 | — | 2 | — | 3 | ||||||||||||||
Total Year-end 2016 | 26 | 45 | 5 | 17 | — | 93 | ||||||||||||||
2017 | (4 | ) | 7 | — | 8 | — | 11 | |||||||||||||
2018 | (5 | ) | 2 | 6 | 5 | — | 8 | |||||||||||||
2019 | (1 | ) | — | 3 | — | 10 | 12 | |||||||||||||
2020 | (7 | ) | — | 13 | — | — | 6 | |||||||||||||
2021 | (4 | ) | — | 18 | — | — | 14 | |||||||||||||
Total Year-end 2021 | 5 | 54 | 45 | 30 | 10 | 144 | ||||||||||||||
Notes: | ||||||||||||||||||||
Includes aircraft on firm order as well as 5 leased A320neo aircraft. | ||||||||||||||||||||
2017 reflects scheduled deliveries of 8 A320ceo and 10 A321ceo aircraft, net of 1 A320ceo and 2 A321ceo lease expirations. | ||||||||||||||||||||
3
Forward-Looking Statements
Statements in this release and certain oral statements made from time to time by representatives of the Company contain various forward-looking statements within the meaning Section 21E of the Securities Exchange Act of 1934, as amended, which represent the Company's expectations or beliefs concerning future events. When used in this release, the words “expects,” “estimates,” “plans,” “anticipates,” “indicates,” “believes,” “forecast,” “guidance,” “outlook,” “may,” “will,” “should,” “seeks,” “targets” and similar expressions are intended to identify forward-looking statements. Similarly, statements that describe the Company's objectives, plans or goals, or actions the Company may take in the future, are forward-looking statements. Forward-looking statements include, without limitation, statements regarding the Company's intentions and expectations regarding the delivery schedule of aircraft on order, guidance and estimates for the third and fourth quarter and full year 2015 including expectations regarding the delivery schedule of aircraft on order, announced new service routes, revenues, cost of operations, operating margin, capacity, CASM, CASM ex-fuel, fuel expense, economic fuel cost, expected unrealized mark-to-market gains or losses, capital expenditures and other working capital requirements, aircraft rent, depreciation and amortization, fuel hedges and tax rates. All forward-looking statements in this release are based upon information available to the Company on the date of this release. The Company has no intent, nor undertakes any obligation, to publicly update or revise any of these projections, whether as a result of new information, future events or otherwise, except as required by law. Forward-looking statements are subject to a number of factors that could cause the Company's actual results to differ materially from the Company's expectations, including the competitive environment in the airline industry; the Company's ability to keep costs low; changes in fuel costs; the impact of worldwide economic conditions on customer travel behavior; the Company's ability to generate non-ticket revenues; and government regulation. Additional information concerning these and other factors is contained in the Company's Securities and Exchange Commission filings, including but not limited to the Company's Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.
4