Alaska Airlines Reports Fourth Quarter Net Income of $181M, $798M For The Full Year 2019

Alaska Airlines announced on Tuesday their fourth quarter and full-year 2019 financial results. The carrier reported a net income of $181M or $1.46 per diluted share for the fourth quarter and $798M or a diluted EPS of $6.42 for the full year.


Alaska Airlines Boeing 737NG - Courtesy Alaska Airlines

At the close of markets today, the Alaska Air Group (NYSE: ALK) announced financial results for the fourth quarter and full year 2019. The carrier reported a fourth quarter net income of $181M or a diluted earnings per share of $1.46 versus a net income of $93M and EPS of $0.75 for Q4 2018. For the full year, Alaska reported net income of $798M or a diluted EPS of $6.42, as compared to a net income of $554M and an EPS of $4.46 for full-year 2018. Additionally, the airline announced a 7% increase in their quarterly dividend from $0.35 to $0.375 per share. This is the seventh time the company has raised their quarterly dividend since it was introduced in 2013 and the dividend will be payable March 5, 2020 to shareholders of record as of February 18, 2020. In Tuesday’s announcement, Alaska Airline’s CEO Brad Tilden said,


Alaska Airlines CEO Brad Tilden Rings Closing Bell at NYSE - Courtesy Alaska Airlines

“When we announced our intention to purchase Virgin America in the spring of 2016, we launched a body of work that was designed to make Alaska the ‘Go To’ airline for people living up and down the West Coast. 2019 was a fantastic year as we completed the majority of that work and began to see significant returns from our investment. We’re grateful to our people for pulling together to produce this strong financial performance, and proud that they are sharing in this financial success through our incentive pay program.”


During 2019, the company returned approximately $248M to shareholders through dividends and share repurchases. Alaska Air Group generated around $1.7B in operating cash flow during the year and invested around $696M in capital expenditures, ending the year with a free cash flow of approximately $1B. Passenger revenues grew 8% in the fourth quarter in Q4 versus Q4 2018 and 6% for the full year. The full year adjusted pre-tax margin came in at 12%, a 3.1% year-over-year margin improvement. At the close of the year, Alaska held $1.5B in unrestricted cash and equivalents.


For the fourth quarter, revenue per available seat mile (RASM) increased 4.2% to 13.38 cents versus Q4 2018, while full year RASM increased 4.2% to 13.17 cents. Cost per available seat mile, excluding fuel (CASM-ex) for the fourth quarter increased 0.7% versus Q4 2018 to 9.01 cents, while full year CASM-ex increased 2.3% to 8.70 cents.


Some notable highlights for 2019 include the launch of service from Paine Field in Everett, Washington to ten West Coast destinations as well as new livery on the Airline’s Airbus fleet and cabin interior renovations on 60% of the Airbus fleet. Additionally, Alaska installed high-speed satellite Wi-Fi on its 104th mainline aircraft (45% of the mainline fleet) and opened a new 15,000 square foot flagship lounge at Sea-Tac. The company also added EL AL as a Mileage Plan partner. During 2019, Alaska Airlines added four Boeing 737-900ERs and two Airbus A320neos to their mainline fleet as well as four Embraer E175s to their regional fleet.

In after-hours trading on Tuesday, shares in the Alaska Air Group (NYSE: ALK) were trading down 1.85% at $64.30/share (5:17PM EST).



Source: Alaska Airlines

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