Allegiant Travel Company Third Quarter 2011 Financial Results

LAS VEGAS, Oct. 26, 2011 (GLOBE NEWSWIRE) — Allegiant Travel Company ALGT +0.25% today reported the financial results for the 3rd quarter 2011 and comparisons to prior year equivalents.

“We are very proud to report our 35th consecutive profitable quarter,” stated Maurice J. Gallagher, Jr., Chairman and CEO of Allegiant Travel Company. "I’d like to thank our Team Members for their great efforts and contributions to another successful quarter.

“Revenues continue to perform nicely. Most of the meaningful revenue metrics during the third quarter increased 15% or more year over year, another strong performance. We are continuing our focus on near term projects. We now have two 166 seat MD-80 aircraft in service on our Bellingham routes, and we are beginning to sell into the extra seats.

“Our 757 activity was successful during the quarter as well. We began operations with our initial 757 aircraft in late July and operated it on two routes to and from Las Vegas. For a nominal amount of additional fuel burn, we are generating 67 additional profit potential seats. These additional seats on our peak days, in the proper markets, are expected to contribute significant incremental profit.

“Lastly we are making good progress on the revamp of our automation platform. Current plans call for our new platform to be available in time for the January 24th DOT cutover date. It will be the first enhancement of many to come, with the ultimate objective of creating an OTA style system that will enhance our efforts to sell additional hotel overnights and associated packages,” concluded Gallagher.

Andrew C. Levy, President of Allegiant Travel Company, stated, "We are very pleased in our ability to continuously offset increases in fuel prices with higher fares. Our total fare of $120.63 is a record high for the 3rd quarter, which is our seasonally weakest time of the year. It is the fourth consecutive quarter in which we have posted record fares for the respective quarter.

“Gains in the base airfare, air-related ancillary, third party ancillary and load factor all contributed to a 19.5% increase in TRASM. The unit revenue comparables become more difficult as the year progresses, but October should be another strong month with a projected year over year gain in PRASM between 16 and 18% despite 5% capacity growth. We expect 4th quarter PRASM to increase between 11 and 13% on a year over year basis despite capacity growth of between 5 and 9%.

“Finally, we are again pleased with the growth in third party ancillary revenue. As noted below, we saw growth in both hotel room nights and rental car days which helped to account for a 17.5% increase in ancillary revenue per passenger for the quarter,” concluded Levy.

Scott Sheldon, SVP and CFO of Allegiant Travel Company, stated, "During the quarter our cost per passenger ex-fuel increased 9.7% to $57.42. The increase in ex-fuel costs was due in part to a 6.5% reduction in aircraft utilization and a 2.3% decline in average stage length. As was the case in the 2nd quarter, we once again restricted capacity in the 3rd quarter in an effort to offset higher fuel which put additional pressure on our unit costs.

“Our increase in non-fuel costs was also due to the continued execution of our engine overhaul strategy, credit card processing fees related to a substantial increase in scheduled revenue and depreciation and amortization related to our four operating 757 aircraft, three of which are leased to other carriers.

“Lastly, our unrestricted cash balance (including investments in marketable securities) decreased slightly during the 3rd quarter to $303 million, down $14 million from the end of the 2nd quarter. During the quarter we raised $7 million of debt secured by one 757 aircraft purchased during the first quarter. In addition we spent $19 million in cap ex bringing our year to date total to $69 million,” concluded Sheldon.