ALGT

ALLEGIANT TRAVEL CO

Industrials | Small Cap

-$1.67

EPS Forecast

$565.7

Revenue Forecast

The company already released most recent quarter's earnings. We will publish our AI's next quarter's forecast around 2024-12-31
EX-99.1 2 a2019q48-kex991.htm EXHIBIT 99.1 Exhibit
Allegiant Q4/FY 2019 Earnings
Page 1

Exhibit 99.1
 algtheaderq417a12.jpg
  
ALLEGIANT TRAVEL COMPANY
FOURTH QUARTER AND FULL YEAR 2019 FINANCIAL RESULTS
Fourth quarter 2019 fully diluted earnings per share of $3.72
Fourth quarter 2019 airline only diluted earnings per share of $4.04(1) 
Full year 2019 fully diluted earnings per share of $14.26
Full year 2019 airline only diluted earnings per share of $15.88(1)
68th consecutive profitable quarter

LAS VEGAS. January 29, 2020 —Allegiant Travel Company (NASDAQ: ALGT) today reported the following financial results for the fourth quarter and full year 2019, as well as comparisons to the prior year:

Consolidated
Three Months Ended December 31,
Percent Change
 
Twelve Months Ended December 31,
Percent Change
(unaudited)
2019
 
2018
 
 
2019
 
2018
 
Total operating revenue (millions)
$
461.1

 
$
412.1

11.9
%
 
$
1,841.0

 
$
1,667.4

10.4
%
Operating income (millions)
92.7

 
63.1

46.9

 
364.0

 
243.5

49.5

Net income (millions)
60.5

 
41.4

46.1

 
232.1

 
161.8

43.4

Diluted earnings per share
$
3.72

 
$
2.56

45.3

 
$
14.26

 
$
10.00

42.6


Airline only
Three Months Ended December 31,
Percent Change
 
Twelve Months Ended December 31,
Percent Change
(unaudited)
2019
 
2018
 
 
2019
 
2018
 
Airline operating revenue (millions)(1)
$
456.6

 
$
409.9

11.4
 %
 
$
1,822.5

 
$
1,659.1

9.8
 %
Airline operating income (millions)(1)
97.4

 
68.2

42.8
 %
 
388.7

 
255.9

51.9
 %
Airline operating margin
21.3
%
 
16.6
%
4.7 pts.

 
21.3
%
 
15.4
%
5.9 pts.

Airline diluted earnings per share(1)
$
4.04

 
$
2.87

40.8
 %
 
$
15.88

 
$
10.77

47.4
 %
 
 
 
 
 
 
 
 
 
 
Airline CASM ex fuel (cents)(1)
6.50

 
6.60

(1.5
)%
 
6.22

 
6.43

(3.3
)%

(1) Denotes a non-GAAP financial measure. Refer to Appendix A: Non-GAAP Presentation section within this document for further information.

 


Allegiant Q4/FY 2019 Earnings
Page 2


“I am very happy to report our 68th consecutive profitable quarter and another profitable year,” stated Maurice J. Gallagher, Jr., chairman and CEO of Allegiant Travel Company. "The airline group successfully grew operating margin from 15 percent in 2018 to over 21 percent in 2019. Our success is very much tied to the efforts of our valued team members, who this year have also voted Allegiant as one of the Top 100 Best Places to Work according to Glassdoor's national survey. We are committed to investing in our people and are happy to report profit sharing payments to our employees company-wide are up nearly 80 percent from 2018. We could not achieve these outstanding financial and operational results without our dedicated team members, and I thank them for another truly extraordinary year.
"The highlights below show what a remarkable year we had in 2019, post our transition to our all-Airbus fleet. This transition is working as expected regarding both operations and profitability. We had an excellent operational quarter and year, averaging $6.3 million of EBITDA per aircraft this year, as predicted. We recently announced 44 new routes in the coming months - the largest network expansion in company history - which will bring us to more than 500 routes served. We truly are becoming a national brand as our reach stretches from coast to coast. Our non-competitive approach and limited-utilization model continues to work as it has for the past 18 years, allowing us to generate industry-leading profits.
"In closing, I would like to congratulate Scott DeAngelo on his promotion to executive vice president, chief marketing officer. In the nearly two years he has been with us, he has been the critical cog in our efforts to better understand our customers via a more data centric approach. This is a critical requirement in our Allegiant 2.0 evolution. He led the negotiations, as well, in our recent efforts to obtain the Allegiant Stadium naming rights. We are fortunate to have Scott, with his talent and experience on the team as we evolve into a customer centric travel company in the coming years. "

FY 2019 guidance recap

•
Fuel cost per gallon for 2019 was $2.18, three cents higher than our expectation of $2.15
◦
Expectation going into fourth quarter was $2.08, whereas actual cost was $2.18
▪
Increase drove a $0.29 reduction in our expected fourth quarter EPS
•
Sunseeker Resort project spend expected between $90 to $100 million with actual spend at $48 million
◦
No change in anticipated second quarter 2021 opening
◦
Lower spend resulted in reduced capitalized interest causing interest expense to be slightly higher than guidance
•
Ended 2019 with 91 total A320 series aircraft, two fewer than expected
◦
Incremental two aircraft have been placed in service in early 2020
▪
Still expect to have 105 aircraft by end of 2020
•
Airline capex spend exceeded guidance
◦
Driven by opportunistic engine acquisitions and earlier than planned aircraft deliveries

Airline only fourth quarter 2019 results

•
Diluted earnings per share were $4.04, an increase of over 40 percent versus last year
•
21.3 percent operating margin for the quarter, up 4.7 points year over year
•
TRASM increased 2.5 percent despite capacity growth of 8.3 percent
◦
Despite a 0.5 percent TRASM headwind from our initial co-branded credit card breakage revenue in fourth quarter 2018
•
Average fare - air related charges (air ancillary) up 13.4 percent year over year
◦
Four consecutive quarters of air ancillary in excess of $50 per passenger
•
Third party products revenue up 17.4 percent versus last year
◦
Hotel net revenue grew 22 percent and car rental net revenue grew 16 percent, far exceeding passenger growth
•
Operating CASM, excluding fuel, declined 1.5 percent
◦
Efficiencies in maintenance along with more targeted marketing spend were the largest drivers of improvement
◦
Year over year decrease is less than initial expectations due to higher than expected profit sharing payments to employees and unplanned line maintenance events

Airline only full year 2019 highlights

•
Industry-leading controllable completion of 99.96 percent, up versus prior year

Allegiant Q4/FY 2019 Earnings
Page 3

•
On time performance (A-14) for the year was 78.7 percent, up 1.8 points year over year
•
Average fare - third party products revenue up 10.5 percent year over year on a per passenger basis
◦
Driven by higher rental car net revenue and increased activity from our co-branded credit card
•
Fixed fee contract revenue of $65 million
◦
Highest annual total in the company's history
•
Operating CASM, excluding fuel, declined 3.3 percent
◦
Reduction on a unitized basis in every operating expense line item with the exception of depreciation
◦
CASM, excluding fuel and profit sharing would have declined 4.4 percent
•
ASMs per gallon up 5.8 percent in 2019 versus 2018
•
EBITDA of $536.9 million, up 40 percent over the prior year
◦
Average airline EBITDA per aircraft of $6.3 million

Liquidity and shareholder returns

•
Total cash and investments at December 31, 2019 were $473 million
•
Total debt of $1.4 billion
•
We have 27 unencumbered aircraft
•
Returned $11 million in dividends in the fourth quarter
◦
Expect to pay dividend of $0.70 per share on March 12, 2020 to shareholders of record as of March 2, 2020
•
Currently have approximately $85 million in share repurchase authority
•
Drew down $81 million from the revolving credit facility to facilitate aircraft and engine acquisitions
◦
Intend to raise long-term financing on these assets individually and use the proceeds to pay down the facility

Non-airline highlights

•
Non-airline businesses resulted in a combined operating loss of $4.7 million during fourth quarter
•
In negotiation with potential buyer for Teesnap



Allegiant Q4/FY 2019 Earnings
Page 4

Guidance, subject to revision
 
 
 
 
 
Full year 2020 guidance
 
Previous
Current
Fuel cost per gallon
 
$2.12
$2.15
Available seat miles (ASMs) / gallon
 
82.5 to 83.5
82.5 to 83.5
 
 
 
 
Interest expense (millions)
 
$75 to $80
$75 to $80
Capitalized interest (millions)
 
$16 to $19
$16 to $19
Tax rate
 
23.0% to 24.0%
23.0% to 24.0%
Share count (millions)
 
16.0
16.0
Earnings per share
 
$16.50 to $19.00
$16.50 to $19.00
 
 
 
 
System ASMs - year over year change
 
10 to 12%
10 to 12%
Scheduled service ASMs - year over year change
 
10 to 12%
10 to 12%
 
 
 
 
Depreciation expense (millions)
 
$180 to $190
$180 to $190
Airline operating CASM excluding fuel - year over year change
 
(2) to 0%
(2) to 0%
 
 
 
 
Airline CAPEX - full year 2020
 
 
 
Capital expenditures (millions)
 
$275 to $295
$275 to $295
Capitalized Airbus deferred heavy maintenance (millions) *
 
$100 to $120
$100 to $120
 
 
 
 
Sunseeker Resorts Project - 2020
 
 
 
Expected full year 2020 spend (millions)
 
$325 to $350
$325 to $350
 
 
 
 
Sunseeker Resorts Project - Total project **
 
 
 
2018 project spend (millions)
 
 
$51
2019 project spend (millions)
 
 
$48
Total expected project spend (millions) ***
 
$470
$470
 
 
 
 
Other CAPEX - full year 2020****
 
 
 
Capital expenditures (millions)
 
$15 to $20
$15 to $20

Previous guidance as of November 13, 2019
* Not included in capital expenditure total
** Total project spend includes $25m of pre-operating expense
*** Of the total remaining capex, expect to receive $175m in third party financing from an affiliate of TPG Sixth Street Partners as the last funds in the project, of which 2/3 will be non-recourse to Allegiant Travel Company
**** Includes Allegiant Nonstop
Aircraft fleet plan by end of period
 
 
 
 
 
 
 
 
 
 
 
Aircraft - (seats per AC)
YE19

1Q20

2Q20

3Q20

YE20

A319 (156 seats)
37

38

38

38

38

A320 (177/186 seats)
54

57

63

65

67

Total
91

95

101

103

105


Aircraft listed in table above include only in-service aircraft and future aircraft under contract (subject to change)


Allegiant Travel Company will host a conference call with analysts at 4:30 p.m. ET Wednesday January 29, 2020 to discuss its fourth quarter and full year 2019 financial results. A live broadcast of the conference call will be available via the Company’s

Allegiant Q4/FY 2019 Earnings
Page 5

Investor Relations website homepage at http://ir.allegiantair.com. The webcast will also be archived in the “Events & Presentations” section of the website.

Allegiant Q4/FY 2019 Earnings
Page 6

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 premier leisure experiences - from vacations to hometown family entertainment. Since 1999, Allegiant Air has linked travelers in small-to-medium cities to world-class vacation destinations with all-nonstop flights and industry-low average fares. Today, Allegiant serves more than 450 routes across the country, with base airfares less than half the cost of the average domestic roundtrip ticket. Allegiant’s Sunseeker Resorts subsidiary is currently under construction with its inaugural resort property, Sunseeker Resort Charlotte Harbor in Southwest Florida - a unique waterside integrated resort like no other. And a growing group of Allegiant Nonstop family entertainment centers offer state-of-the art indoor games and attractions to thrill seekers of all ages. For more information, visit us at Allegiant.com. Media information, including photos, is available at http://gofly.us/iiFa303wrtF




Media Inquiries: mediarelations@allegiantair.com

Investor Inquiries: ir@allegiantair.com

 
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 expenses, revenues, earnings, ASM growth, fuel consumption, expected capital expenditures, number of contracted aircraft to be placed in service in the future, the development and financing 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, 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 ability to finance aircraft under contract, terrorist attacks, risks inherent to airlines, our competitive environment, our reliance on third parties who provide facilities or services to us, the possible loss of key personnel, economic and other conditions in markets in which we operate, the ability to successfully develop and finance a resort in Southwest Florida, governmental regulation, increases in maintenance costs and cyclical and seasonal fluctuations in our operating results.
 
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:



Allegiant Travel Company
Consolidated Statements of Income
(in thousands, except per share amounts)
(Unaudited)
 
 
Three Months Ended December 31,
 
Percent
 
2019
 
2018
 
change
OPERATING REVENUE:
 
 
 
 
 
Passenger revenue
$
416,976

 
$
376,258

 
10.8

Third party products
16,456

 
14,015

 
17.4

Fixed fee contract revenue
22,199

 
17,285

 
28.4

Other revenue
5,443

 
4,556

 
19.5

Total operating revenue
461,074

 
412,114

 
11.9

OPERATING EXPENSES:
 
 
 
 
 
Salary and benefits
109,859

 
101,578

 
8.2

Aircraft fuel
103,574

 
103,808

 
(0.2
)
Station operations
43,063

 
38,754

 
11.1

Depreciation and amortization
41,740

 
36,710

 
13.7

Maintenance and repairs
23,243

 
23,151

 
0.4

Sales and marketing
19,853

 
19,290

 
2.9

Aircraft lease rental
—

 
101

 
(100.0
)
Other
27,090

 
25,634

 
5.7

Total operating expense
368,422

 
349,026

 
5.6

OPERATING INCOME
92,652

 
63,088

 
46.9

OTHER (INCOME) EXPENSE:
 
 
 
 
 
Interest expense
18,270

 
15,649

 
16.7

Capitalized interest
(1,028
)
 
(2,075
)
 
(50.5
)
Interest income
(2,485
)
 
(2,967
)
 
(16.2
)
Other, net
(740
)
 
12

 
NM

Total other expense
14,017

 
10,619

 
32.0

INCOME BEFORE INCOME TAXES
78,635

 
52,469

 
49.9

PROVISION FOR INCOME TAXES
18,113

 
11,022

 
64.3

NET INCOME
$
60,522

 
$
41,447

 
46.0

Earnings per share attributable to common shareholders(1):
 
 
 

 
 
Basic

$3.72

 

$2.56

 
45.3

Diluted

$3.72

 

$2.56

 
45.3

Weighted average shares outstanding used in computing earnings per share attributable to common shareholders(1):
 

 
 

 
 
Basic
16,000

 
15,976

 
0.2

Diluted
16,006

 
15,989

 
0.1


NM - Not meaningful
(1) The Company's unvested restricted stock awards are considered participating securities as they receive non-forfeitable rights to cash dividends at the same rate as common stock. The Basic and Diluted earnings per share calculations for the periods presented reflect the two-class method mandated by ASC Topic 260, "Earnings Per Share." The two-class method adjusts both the net income and the shares used in the calculation. Application of the two-class method did not have a significant impact on the Basic and Diluted earnings per share for the periods presented.








Allegiant Travel Company
Operating Statistics
(Unaudited) 

 
Three Months Ended December 31,
 
Percent
 
2019
 
2018
 
change (1)
OPERATING STATISTICS
 
 
 
 
 
Total system statistics:
 
 
 
 
 
Passengers
3,585,966

 
3,239,286

 
10.7

Available seat miles (ASMs) (thousands)
3,928,536

 
3,605,069

 
9.0

Operating expense per ASM (CASM) (cents)
9.38

 
9.68

 
(3.1
)
Fuel expense per ASM (cents)
2.64

 
2.88

 
(8.3
)
Operating CASM, excluding fuel (cents)
6.74

 
6.80

 
(0.9
)
ASMs per gallon of fuel
82.8

 
81.4

 
1.7

Departures
27,088

 
24,300

 
11.5

Block hours
60,684

 
55,285

 
9.8

Average stage length (miles)
846

 
866

 
(2.3
)
Average number of operating aircraft during period
90.1

 
86.6

 
4.0

Average block hours per aircraft per day
7.3

 
6.9

 
5.8

Full-time equivalent employees at end of period
4,363

 
3,901

 
11.8

Fuel gallons consumed (thousands)
47,461

 
44,299

 
7.1

Average fuel cost per gallon
$
2.18

 
$
2.34

 
(6.8
)
Scheduled service statistics:
 
 
 
 
 
Passengers
3,516,263

 
3,183,524

 
10.5

Revenue passenger miles (RPMs) (thousands)
3,073,055

 
2,846,246

 
8.0

Available seat miles (ASMs) (thousands)
3,745,031

 
3,457,044

 
8.3

Load factor
82.1
%
 
82.3
%
 
(0.2
)
Departures
25,541

 
23,017

 
11.0

Block hours
57,687

 
52,814

 
9.2

Total passenger revenue per ASM (TRASM) (cents)(2)
11.57

 
11.29

 
2.5

Average fare - scheduled service(3)
$
65.35

 
$
71.23

 
(8.3
)
Average fare - air-related charges(3)
$
53.24

 
$
46.96

 
13.4

Average fare - third party products
$
4.68

 
$
4.40

 
6.4

Average fare - total
$
123.26

 
$
122.59

 
0.5

Average stage length (miles)
856

 
877

 
(2.4
)
Fuel gallons consumed (thousands)
45,163

 
42,346

 
6.7

Average fuel cost per gallon
$
2.18

 
$
2.33

 
(6.4
)
Percent of sales through website during period
93.1
%
 
93.8
%
 
(0.7
)
Other data:
 
 
 
 
 
Rental car days sold
426,428

 
415,094

 
2.7

Hotel room nights sold
96,396

 
95,804

 
0.6


(1) Except load factor and percent of sales through website, which is percentage point change.
(2) Various components of this measurement do not have a direct correlation to ASMs. These figures are provided on a per ASM basis to facilitate comparison with airlines reporting revenues on a per ASM basis.
(3) Reflects division of passenger revenue between scheduled service and air-related charges in Company's booking path.



Allegiant Travel Company
Consolidated Statements of Income
(in thousands, except per share amounts)
(Unaudited)
 
 
Twelve Months Ended December 31,
 
Percent
 
2019
 
2018
 
change
OPERATING REVENUE:
 
 
 
 
 
Passenger revenue
$
1,682,955

 
$
1,533,701

 
9.7

Third party products
70,012

 
58,060

 
20.6

Fixed fee contract revenue
65,057

 
50,286

 
29.4

Other revenue
22,941

 
25,400

 
(9.7
)
Total operating revenue
1,840,965

 
1,667,447

 
10.4

OPERATING EXPENSES:
 
 
 
 
 
Salary and benefits
450,448

 
413,892

 
8.8

Aircraft fuel
427,827

 
445,814

 
(4.0
)
Station operations
171,420

 
161,019

 
6.5

Depreciation and amortization
155,852

 
129,351

 
20.5

Maintenance and repairs
91,713

 
99,015

 
(7.4
)
Sales and marketing
78,910

 
73,514

 
7.3

Aircraft lease rentals
—

 
868

 
(100.0
)
Other
100,845

 
100,515

 
0.3

Total operating expense
1,477,015

 
1,423,988

 
3.7

OPERATING INCOME
363,950

 
243,459

 
49.5

OTHER (INCOME) EXPENSE:
 
 
 
 
 
Interest expense
76,801

 
56,116

 
36.9

Capitalized interest
(4,472
)
 
(2,354
)
 
90.0

Interest income
(12,523
)
 
(9,226
)
 
35.7

Loss on extinguishment of debt
3,677

 
—

 
NM

Other, net
(780
)
 
(395
)
 
97.5

Total other expense
62,703

 
44,141

 
42.1

INCOME BEFORE INCOME TAXES
301,247

 
199,318

 
51.1

PROVISION FOR INCOME TAXES
69,130

 
37,516

 
84.3

NET INCOME
$
232,117

 
$
161,802

 
43.5

Earnings per share attributable to common shareholders(1):
 
 
 
 
 
Basic

$14.27

 

$10.02

 
42.4

Diluted

$14.26

 

$10.00

 
42.6

Weighted average shares outstanding used in computing earnings per share attributable to common shareholders(1):
 
 
 
 
 
Basic
16,027

 
15,941

 
0.5

Diluted
16,041

 
15,967

 
0.5


NM - Not meaningful
(1) The Company's unvested restricted stock awards are considered participating securities as they receive non-forfeitable rights to cash dividends at the same rate as common stock. The Basic and Diluted earnings per share calculations for the periods presented reflect the two-class method mandated by ASC Topic 260, "Earnings Per Share." The two-class method adjusts both the net income and the shares used in the calculation. Application of the two-class method did not have a significant impact on the Basic and Diluted earnings per share for the periods presented.






Allegiant Travel Company
Operating Statistics
(Unaudited) 
 
Twelve Months Ended December 31,
 
Percent
 
2019
 
2018
 
change (1)
OPERATING STATISTICS
 
 
 
 
 
Total system statistics:
 
 
 
 
 
Passengers
15,012,149

 
13,750,199

 
9.2

Available seat miles (ASMs) (thousands)
16,174,240

 
14,899,874

 
8.6

Operating expense per ASM (CASM) (cents)
9.13

 
9.56

 
(4.5
)
Fuel expense per ASM (cents)
2.65

 
2.99

 
(11.4
)
Operating CASM, excluding fuel (cents)
6.48

 
6.57

 
(1.4
)
ASMs per gallon of fuel
82.3

 
77.8

 
5.8

Departures
110,542

 
101,212

 
9.2

Block hours
248,513

 
230,123

 
8.0

Average stage length (miles)
855

 
868

 
(1.5
)
Average number of operating aircraft during period
85.6

 
91.0

 
(5.9
)
Average block hours per aircraft per day
8.0

 
6.9

 
15.9

Full-time equivalent employees at end of period
4,363

 
3,901

 
11.8

Fuel gallons consumed (thousands)
196,442

 
191,471

 
2.6

Average fuel cost per gallon
$
2.18

 
$
2.33

 
(6.4
)
Scheduled service statistics:
 

 
 

 
 
Passengers
14,823,267

 
13,606,103

 
8.9

Revenue passenger miles (RPMs) (thousands)
13,038,003

 
12,145,601

 
7.3

Available seat miles (ASMs) (thousands)
15,545,818

 
14,340,674

 
8.4

Load factor
83.9
%
 
84.7
%
 
(0.8
)
Departures
105,690

 
96,554

 
9.5

Block hours
238,361

 
220,760

 
8.0

Total passenger revenue per ASM (TRASM) (cents)(2)
11.28

 
11.10

 
1.6

Average fare - scheduled service(3)
$
61.58

 
$
67.01

 
(8.1
)
Average fare - air-related charges(3)
$
51.96

 
$
45.71

 
13.7

Average fare - third party products
$
4.72

 
$
4.27

 
10.5

Average fare - total
$
118.26

 
$
116.99

 
1.1

Average stage length (miles)
859

 
875

 
(1.8
)
Fuel gallons consumed (thousands)
188,596

 
183,798

 
2.6

Average fuel cost per gallon
$
2.18

 
$
2.32

 
(6.0
)
Percent of sales through website during period
93.3
%
 
93.8
%
 
(0.5
)
Other data:
 
 
 
 
 
Rental car days sold
1,921,930

 
1,823,451

 
5.4

Hotel room nights sold
415,593

 
409,164

 
1.6


(1) Except load factor and percent of sales through website, which is percentage point change.
(2) Various components of this measurement do not have a direct correlation to ASMs. These figures are provided on a per ASM basis to facilitate comparison with airlines reporting revenues on a per ASM basis.
(3) Reflects division of passenger revenue between scheduled service and air-related charges in Company's booking path.


Summary Balance Sheet

Unaudited (millions)
12/31/2019
 
12/31/2018
 
Percent Change
Unrestricted cash and investments
 
 
 
 
 
Cash and cash equivalents
$
121.9

 
$
81.5

 
49.6
 %
Short-term investments
335.9

 
314.5

 
6.8

Long-term investments
15.5

 
51.5

 
(69.9
)
Total unrestricted cash and investments
473.3

 
447.5

 
5.8

Debt
 
 
 
 
 
Current maturities of long-term debt and finance lease obligations, net of related costs(1)
173.3

 
152.3

 
13.8

Long-term debt and finance lease obligations, net of current maturities and related costs
1,248.6

 
1,119.4

 
11.5

Total debt
1,421.9

 
1,271.7

 
11.8

Total Allegiant Travel Company shareholders’ equity
883.6

 
690.3

 
28.0


(1) As of December 31, 2018, $428.0 million of the Company's Unsecured Senior Notes (which matured on July 15, 2019) were classified as long-term as the company refinanced the borrowings on a long-term basis in February 2019.


Summary Cash Flow

 
Twelve Months Ended December 31,
 
Percent
Unaudited (millions)
2019
 
2018
 
Change
Cash provided by operating activities
$
440.6

 
$
356.6

 
23.6
%
Purchase of property and equipment, including capitalized interest
(505.2
)
 
(334.8
)
 
50.9

Repurchase of common stock
(18.6
)
 
(3.7
)
 
402.7

Cash dividends paid to shareholders
(45.6
)
 
(45.2
)
 
0.9

Proceeds from the issuance of long-term debt
874.9

 
211.2

 
314.3

Principal payments on long-term debt & finance lease obligations
(705.8
)
 
(232.2
)
 
204.0





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):

 
Three Months Ended December 31,
 
Twelve Months Ended December 31,
 
2019
 
2018
 
2019
 
2018
Basic:
 
 
 
 
 
 
 
Net income
$
60,522

 
$
41,447

 
$
232,117

 
$
161,802

Less net income allocated to participating securities
(1,059
)
 
(504
)
 
(3,413
)
 
(2,106
)
Net income attributable to common stock
$
59,463

 
$
40,943

 
$
228,704

 
$
159,696

Earnings per share, basic
$
3.72

 
$
2.56

 
$
14.27

 
$
10.02

Weighted-average shares outstanding
16,000

 
15,976

 
16,027

 
15,941

Diluted:
 

 
 

 
 
 
 
Net income
$
60,522

 
$
41,447

 
$
232,117

 
$
161,802

Less net income allocated to participating securities
(1,058
)
 
(503
)
 
(3,410
)
 
(2,104
)
Net income attributable to common stock
$
59,464

 
$
40,944

 
$
228,707

 
$
159,698

Earnings per share, diluted
$
3.72

 
$
2.56

 
$
14.26

 
$
10.00

Weighted-average shares outstanding
16,000

 
15,976

 
16,027

 
15,941

Dilutive effect of stock options and restricted stock
101

 
29

 
51

 
53

Adjusted weighted-average shares outstanding under treasury stock method
16,101

 
16,005

 
16,078

 
15,994

Participating securities excluded under two-class method
(95
)
 
(16
)
 
(37
)
 
(27
)
Adjusted weighted-average shares outstanding under two-class method
16,006

 
15,989

 
16,041

 
15,967










Appendix A
Non-GAAP Presentation
Three and Twelve Months Ended December 31, 2019 and 2018
(Unaudited)

Airline operating revenue, airline operating income, airline net income, airline operating expense, 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.

EBITDA, as presented in this press release, and the various airline only metrics disclosed, 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”). They 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 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 to evaluate our operating performance and liquidity and it is among the primary measures used by management for planning and forecasting of future periods. We believe the presentation of this measure is relevant and useful for investors because it allows 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 EBITDA to the most directly comparable GAAP financial performance measure, which we believe is net income. We believe the presentation of EBITDA and the airline only 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.

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 income, net income, operating expenses, and diluted earnings 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 income, net income 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.













Reconciliation of Non-GAAP Financial Measures

 
Three Months Ended December 31,
 
Twelve Months Ended December 31,
 
2019
 
2018
 
2019
 
2018
Reconciliation of airline operating CASM excluding fuel (millions, unless otherwise noted)
 
 
 
 
 
 
 
Consolidated operating expense (GAAP)
$
368.4

 
$
349.0

 
$
1,477.0

 
$
1,424.0

Less aircraft fuel expense
103.6

 
103.8

 
427.8

 
445.8

Less non-airline operating expense(1)
9.3

 
7.3

 
43.3

 
20.7

Total airline operating expense less fuel expense(1)
255.5

 
237.9

 
1,005.9

 
957.5

 
 
 
 
 
 
 
 
System available seat miles
3,928.5

 
3,605.1

 
16,174.2

 
14,899.9

Cost per available seat mile (cents) as reported
9.38

 
9.68

 
9.13

 
9.56

Cost per available seat mile excluding fuel and non-airline operating expense (cents)(1)
6.50

 
6.60

 
6.22

 
6.43


 
Three Months Ended December 31,
 
Twelve Months Ended December 31,
 
2019
 
2018
 
2019
 
2018
Reconciliation of airline operating revenue, operating income, net income, and EBITDA (millions, unless otherwise noted)
 
 
 
 
 
 
 
Operating revenue as reported (GAAP)
$
461.1

 
$
412.1

 
$
1,841.0

 
$
1,667.4

Non-airline operating revenue(1)
4.5

 
2.2

 
18.5

 
8.3

Airline operating revenue(1)
456.6

 
409.9

 
1,822.5

 
1,659.1

 
 
 
 
 
 
 
 
Operating income as reported (GAAP)
92.7

 
63.1

 
364.0

 
243.5

Non-airline operating loss(1)
(4.7
)
 
(5.1
)
 
(24.8
)
 
(12.4
)
Airline operating income(1)
97.4

 
68.2

 
388.7

 
255.9

Airline operating margin
21.3
%
 
16.6
%
 
21.3
%
 
15.4
%
 
 
 
 
 
 
 
 
Net income as reported (GAAP)
60.5

 
41.4

 
232.1

 
161.8

Non-airline net loss(1)
(5.3
)
 
(5.1
)
 
(26.5
)
 
(12.4
)
Airline net income(1)
65.8

 
46.5

 
258.6

 
174.2

 
 
 
 
 
 
 
 
Airline net income(1)
65.8

 
46.5

 
258.6

 
174.2

Airline interest expense(1)
14.2

 
10.6

 
58.1

 
44.5

Airline provision for income taxes(1)
18.1

 
11.0

 
69.1

 
37.5

Airline depreciation and amortization(1)
40.5

 
36.2

 
151.1

 
127.5

Airline EBITDA(1)
138.6

 
104.3

 
536.9

 
383.7

Average number of aircraft in service (#)
90.1

 
86.6

 
85.6

 
91.0

Airline EBITDA per aircraft(1)
1.5

 
1.2

 
6.3

 
4.2





 
Three Months Ended December 31,
 
Twelve Months Ended December 31,
 
2019
 
2018
 
2019
 
2018
Reconciliation of airline diluted earnings per share
 
 
 
 
 
 
 
Net income as reported (GAAP) (millions)
$
60.5

 
$
41.4

 
$
232.1

 
$
161.8

Airline net income (millions)(1)
65.8

 
46.5

 
258.6

 
174.2

 
 
 
 
 
 
 
 
Diluted shares used for computation (thousands)
16,006

 
15,989

 
16,041

 
15,967

 
 
 
 
 
 
 
 
Diluted earnings per share as reported (per share) (GAAP)
$
3.72

 
$
2.56

 
$
14.26

 
$
10.00

 
 
 
 
 
 
 
 
Airline diluted earnings per share(1)
$
4.04

 
$
2.87

 
$
15.88

 
$
10.77


(1) Denotes non-GAAP figure.