Spirit of NKS
10-30-2013, 09:31 AM
#6511
Gets Weekends Off
Joined APC: Feb 2008
Position: Switch, Lever & Light Specialist
Posts: 1,065
Originally Posted by bubi352
A Norwegian LLC is set to become the first flying the 787 if I am not mistaken. They already have the plane and the approval. Seats as low as $200. You can't beat that! The LLC market is definitely going towards long haul flights. It's a proven formula already in Australia and Asia with JetStar.
LLC? Limited Liability Corporation?
or
LCC? Low Cost Carrier?
10-30-2013, 09:45 AM
#6512
Gets Weekends Off
Joined APC: Sep 2012
Posts: 104
great numbers indeed.
this has been mentioned before but painting "no debt" as either positive or negative is misleading. just forget about it.
company chooses sale & leaseback over owning the planes.
implication is that its not reported as debt but as leasing expenses.
its not an accounting trick, just a financing choice.
company acknowledges the leases as long term obligations, like any other airline. (see 2013 investor day presentation for details, page 40 shows $1.1billion of estimated lease obligations. thats a rough debt equivalent).
this has been mentioned before but painting "no debt" as either positive or negative is misleading. just forget about it.
company chooses sale & leaseback over owning the planes.
implication is that its not reported as debt but as leasing expenses.
its not an accounting trick, just a financing choice.
company acknowledges the leases as long term obligations, like any other airline. (see 2013 investor day presentation for details, page 40 shows $1.1billion of estimated lease obligations. thats a rough debt equivalent).
10-30-2013, 11:19 AM
#6513
Gets Weekends Off
Joined APC: Jun 2008
Posts: 647
Originally Posted by Cruise
LLC? Limited Liability Corporation?
or
LCC? Low Cost Carrier?
or
LCC? Low Cost Carrier?
It's actually Norwegian Air Shuttle. It's the third largest LCC in Europe. It's planning to start long haul flights between Europe and the US in May. FLL will be one of their destination.
10-30-2013, 07:34 PM
#6514
Gets Weekends Off
Joined APC: Dec 2005
Posts: 8,898
Hey Spirit guys, honest question, since we may be going through it soon. The Spirit IPO, wasn't that after the new contract '10? What did the pilots get as far as percentage or share, and how was it broken down (methodology)?
10-30-2013, 10:11 PM
#6515
Gets Weekends Off
Joined APC: Jun 2008
Position: More Drag
Posts: 447
Originally Posted by ShyGuy
Hey Spirit guys, honest question, since we may be going through it soon. The Spirit IPO, wasn't that after the new contract '10? What did the pilots get as far as percentage or share, and how was it broken down (methodology)?
10-31-2013, 03:17 AM
#6516
Gets Weekends Off
Joined APC: Dec 2009
Position: Airplane
Posts: 2,385
Originally Posted by sandlapper223
And Shy throws a flash bang into the room...
10-31-2013, 03:22 AM
#6517
ULTP-Ultra Low Tier Pilot
Joined APC: Dec 2007
Posts: 3,228
Hey Spirit guys, honest question, since we may be going through it soon. The Spirit IPO, wasn't that after the new contract '10? What did the pilots get as far as percentage or share, and how was it broken down (methodology)?
10-31-2013, 04:01 AM
#6518
Banned
Thread Starter
Joined APC: Oct 2008
Posts: 1,857
Well, he did say "Honest Question", so here is the answer, "nothing", but you already knew that, that's my "Honest Opinion".
10-31-2013, 04:40 AM
#6519
Gets Weekends Off
Joined APC: Aug 2010
Posts: 2,530
Originally Posted by JoeyMeatballs
Reason for 8% drop in stock today I guess
Spirit Shares Plunge, Revenue From Fees Slows In Q3 - Investors.com
Spirit Airlines (SAVE) earnings took flight and topped estimates, but fee revenue from amenities didn't grow as fast as it did a year ago and shares plunged Wednesday.
The budget airline's third-quarter earnings more than doubled to 79 cents per share from 35 cents. Analysts polled by Thomson Reuters were expecting 74 cents per share.
Revenue jumped 33.4% to $456.6 million, topping estimates for $452.57 million. Passenger revenue revenue rose 38% to $279.5 million.
View Enlarged Image
Total revenue per available seat mile, an important metric in the airline industry, rose 8.9% to 12.55 cents as the load factor widened to 89.1%.
The average ticket revenue per passenger flight segment rose 15.3%, reversing a 12% decline a year ago. But the average non-ticket revenue per passenger flight segment rose 5.4% vs. a 11.5% gain in Q3 2012.
Spirit offers extremely low fares but then charges extra for everything from a carry-on bag to printing out a boarding pass at the airport.
The airline charges $25 for a carry-on bag when booking the flight, but the fee goes up to $50 when checking in at the airport. The first checked bag costs $20 and goes up to $45 at the airport.
Fees for what used to be free amenities have become a major source of revenue for airlines. In 2012, the 15 largest carriers collected $3.5 billion in baggage fees, a 3.8% increase from 2011.
Read More At Investor's Business Daily: Spirit Shares Plunge, Revenue From Fees Slows In Q3 - Investors.com
Follow us: @IBDinvestors on Twitter | InvestorsBusinessDaily on Facebook
Spirit Shares Plunge, Revenue From Fees Slows In Q3 - Investors.com
Spirit Airlines (SAVE) earnings took flight and topped estimates, but fee revenue from amenities didn't grow as fast as it did a year ago and shares plunged Wednesday.
The budget airline's third-quarter earnings more than doubled to 79 cents per share from 35 cents. Analysts polled by Thomson Reuters were expecting 74 cents per share.
Revenue jumped 33.4% to $456.6 million, topping estimates for $452.57 million. Passenger revenue revenue rose 38% to $279.5 million.
View Enlarged Image
Total revenue per available seat mile, an important metric in the airline industry, rose 8.9% to 12.55 cents as the load factor widened to 89.1%.
The average ticket revenue per passenger flight segment rose 15.3%, reversing a 12% decline a year ago. But the average non-ticket revenue per passenger flight segment rose 5.4% vs. a 11.5% gain in Q3 2012.
Spirit offers extremely low fares but then charges extra for everything from a carry-on bag to printing out a boarding pass at the airport.
The airline charges $25 for a carry-on bag when booking the flight, but the fee goes up to $50 when checking in at the airport. The first checked bag costs $20 and goes up to $45 at the airport.
Fees for what used to be free amenities have become a major source of revenue for airlines. In 2012, the 15 largest carriers collected $3.5 billion in baggage fees, a 3.8% increase from 2011.
Read More At Investor's Business Daily: Spirit Shares Plunge, Revenue From Fees Slows In Q3 - Investors.com
Follow us: @IBDinvestors on Twitter | InvestorsBusinessDaily on Facebook
10-31-2013, 05:01 AM
#6520
Gets Weekends Off
Joined APC: Oct 2012
Position: 190 captain and “Pro-pilot”
Posts: 2,918
MIRAMAR (TheStreet) -- Spirit (SAVE_), the U.S. leader in the airline industry's effort to find new ancillary fees, said it wants to charge more for bags and assigned seats on flights at peak travel times.
In a wide ranging interview after the carrier released third-quarter earnings on Wednesday, CEO
Ben Baldanza discussed applying yield management to ancillary fees, Spirit's below average on-time performance and Spirit's dissimilarity from low-cost European carrier Ryanair. He also said that competitor JetBlue (JBLU_) is pursuing an "Icarian strategy."
Airlines have historically charged more for tickets at peak travel times, using complex yield management systems to determine appropriate fares based on historic data and pricing trends. So far, the systems have not been applied to ancillary revenue sources. Historically, major airlines look to innovators like Spirit to develop new revenue strategies.
On the earnings call and in the interview, Baldanza said Spirit is exploring the possibility of applying yield management to ancillary revenue streams. "We've tiptoed around the idea, but not to the level of dynamic that we do ticket pricing," he said. "We like the idea and are looking into ways (to implement it)." Spirit charges low fares for seats and derives most of its passenger revenue from fees for everything else, including carry-on bags and boarding passes acquired at the airport.
Spirit shares have risen 141% this year on the basis of rapid, profitable growth. The carrier said Wednesday it will boost capacity by 22% over the next 24 months, as 28 new Airbus jets are added by the end of 2015 to the existing fleet of 51 Airbus jets.
"We're in the midst of a robust growth cycle," Chief Financial Officer Ted Christie said on the earnings call.
Baldanza would not specify where future expansion might occur but said that "in general we want to be where lots of people live." He declined to say whether Spirit might benefit if divestitures are required in the proposed merger between American (AAMRQ) and US Airways (LCC_). Asked if Spirit might fly Charlotte-Dallas, because such a flight might mitigate antitrust concerns, Baldanza said only, "There are a lot of people in the Carolinas."
At Fort Lauderdale-Hollywood International Airport, Spirit is the No. 2 carrier with 17.3% of the passenger traffic in the first seven months, according to airport statistics. No. 1 is JetBlue with 18.4% of traffic.
JetBlue said Tuesday that it will grow its fleet of Airbus A321 aircraft and will use them "to accelerate attractive growth opportunities at Fort Lauderdale."
Baldanza said he isn't worried about JetBlue. "We have a long record of serving Fort Lauderdale successfully," he said. "Our model works well in South Florida, with a lot of discretionary, price sensitive passengers." He said Spirit's profit strategy relies on three concepts: low fares, a basic product and capacity discipline, while JetBlue offers the opposite: a leisure-oriented product, higher fares than Spirit and limited capacity discipline because "they are not seasonality oriented, they are market-share oriented.
"To us, it's an Icarian strategy," he said. In Greek mythology, Icarus flew too close to the sun, which melted the wax binding his artificial wings. His story is considered to provide an example of excessive ambition that leads to ruin.
Spirit's on-time performance is generally a bit below average because Spirit is prone to delay rather than cancel flights, Baldanza said. Cancellations do not show up in the on-time data. "Because we have a thin schedule, mostly just one flight a day, a cancellation would mean you can't go until the next day," he said. "We choose to run late, rather than cancel." Spirit completes more than 99% of scheduled flights.
Because it doesn't provide the required 1% of passenger revenue, Spirit is not included in the U.S. Transportation Department's monthly compilation of U.S. airline operational performance. DOT reviews airlines annually to determine inclusion the following year. This year's test "had us just below the threshold," Baldanza said. It is likely, he said, that Spirit will be included in 2015.
Baldanza said he does not feel the pressure felt by Ryanair CEO Michael O'Leary to seek to attract higher-paying passengers, perhaps even business passengers. "He has 300-plus airplanes and 11% of the European market," Baldanza said. "We are 51 airplanes, nowhere close to their size. I don't know if we will have to (do that) at 300 airplanes, but we don't see the need now."
Early Wednesday, Spirit reported earnings excluding items of $57.9 million, or 79 cents a share. Analysts had estimated 75 cents. In the same period a year earlier, Spirit earned $25.2 million, or 35 cents a share.
The trading day was a wild one. Shares closed Tuesday at $43.05, opened Wednesday at $46.03, plunged to $39.36 shortly after noon, then recovered to close at $42.76. Various theories were offered for the performance. In a note, Cowen & Co. analyst Helane Becker blamed a one-time, $10 million current quarter charge disclosed during the earnings call related to maintenance expenses following the Oct. 15 engine fire in an aircraft that returned to Dallas soon after takeoff. Becker said the selloff was unwarranted and raised her target price to $48
And so it begins........
In a wide ranging interview after the carrier released third-quarter earnings on Wednesday, CEO
Ben Baldanza discussed applying yield management to ancillary fees, Spirit's below average on-time performance and Spirit's dissimilarity from low-cost European carrier Ryanair. He also said that competitor JetBlue (JBLU_) is pursuing an "Icarian strategy." Airlines have historically charged more for tickets at peak travel times, using complex yield management systems to determine appropriate fares based on historic data and pricing trends. So far, the systems have not been applied to ancillary revenue sources. Historically, major airlines look to innovators like Spirit to develop new revenue strategies.
On the earnings call and in the interview, Baldanza said Spirit is exploring the possibility of applying yield management to ancillary revenue streams. "We've tiptoed around the idea, but not to the level of dynamic that we do ticket pricing," he said. "We like the idea and are looking into ways (to implement it)." Spirit charges low fares for seats and derives most of its passenger revenue from fees for everything else, including carry-on bags and boarding passes acquired at the airport.
Spirit shares have risen 141% this year on the basis of rapid, profitable growth. The carrier said Wednesday it will boost capacity by 22% over the next 24 months, as 28 new Airbus jets are added by the end of 2015 to the existing fleet of 51 Airbus jets.
"We're in the midst of a robust growth cycle," Chief Financial
Officer Ted Christie said on the earnings call. Baldanza would not specify where future expansion might occur but said that "in general we want to be where lots of people live." He declined to say whether Spirit might benefit if divestitures are required in the proposed merger between American (AAMRQ) and US Airways (LCC_). Asked if Spirit might fly Charlotte-Dallas, because such a flight might mitigate antitrust concerns, Baldanza said only, "There are a lot of people in the Carolinas."
At Fort Lauderdale-Hollywood International Airport, Spirit is the No. 2 carrier with 17.3% of the passenger traffic in the first seven months, according to airport statistics. No. 1 is JetBlue with 18.4% of traffic.
JetBlue said Tuesday that it will grow its fleet of Airbus A321 aircraft and will use them "to accelerate attractive growth opportunities at Fort Lauderdale."
Baldanza said he isn't worried about JetBlue. "We have a long record of serving Fort Lauderdale successfully," he said. "Our model works well in South Florida, with a lot of discretionary, price sensitive passengers." He said Spirit's profit strategy relies on three concepts: low fares, a basic product and capacity discipline, while JetBlue offers the opposite: a leisure-oriented product, higher fares than Spirit and limited capacity discipline because "they are not seasonality oriented, they are market-share oriented.
"To us, it's an Icarian strategy," he said. In Greek mythology, Icarus flew too close to the sun, which melted the wax binding his artificial wings. His story is considered to provide an example of excessive ambition that leads to ruin.
Spirit's on-time performance is generally a bit below average because Spirit is prone to delay rather than cancel flights, Baldanza said. Cancellations do not show up in the on-time data. "Because we have a thin schedule, mostly just one flight a day, a cancellation would mean you can't go until the next day," he said. "We choose to run late, rather than cancel." Spirit completes more than 99% of scheduled flights.
Because it doesn't provide the required 1% of passenger revenue, Spirit is not included in the U.S. Transportation Department's monthly compilation of U.S. airline operational performance. DOT reviews airlines annually to determine inclusion the following year. This year's test "had us just below the threshold," Baldanza said. It is likely, he said, that Spirit will be included in 2015.
Baldanza said he does not feel the pressure felt by Ryanair CEO Michael O'Leary to seek to attract higher-paying passengers, perhaps even business passengers. "He has 300-plus airplanes and 11% of the European market," Baldanza said. "We are 51 airplanes, nowhere close to their size. I don't know if we will have to (do that) at 300 airplanes, but we don't see the need now."
Early Wednesday, Spirit reported earnings excluding items of $57.9 million, or 79 cents a share. Analysts had estimated 75 cents. In the same period a year earlier, Spirit earned $25.2 million, or 35 cents a share.
The trading day was a wild one. Shares closed Tuesday at $43.05, opened Wednesday at $46.03, plunged to $39.36 shortly after noon, then recovered to close at $42.76. Various theories were offered for the performance. In a note, Cowen & Co. analyst Helane Becker blamed a one-time, $10 million current quarter charge disclosed during the earnings call related to maintenance expenses
following the Oct. 15 engine fire in an aircraft that returned to Dallas soon after takeoff. Becker said the selloff was unwarranted and raised her target price to $48And so it begins........
Thread
Thread Starter
Forum
Replies
Last Post
