• Joe Breitfeller

Hawaiian Airlines Announces Second Quarter Net Loss of $106.9 Million or $2.33 per Diluted Share

Hawaiian Airlines announced on Tuesday a second quarter net loss of $106.9 million or $2.33 per diluted share. The company ended the quarter with cash, cash equivalents and short-term investments of $761 million and debt and finance lease obligations of $1 billion.

Hawaiian Airlines Airbus A321neo - Courtesy Hawaiian Airlines

Yesterday (July 28, 2020), Hawaiian Airline Holdings, Inc. (NASDAQ: HA) reported a second quarter net loss of $106.9 million or $(2.33) per diluted share on a 91.6 percent year-over-year revenue decline to $60 million. The company ended the quarter with cash, cash equivalents and short-term investments of $761 million, debt and finance lease obligations of approximately $1 billion, and an air traffic liability of $554 million. For most of the second quarter, Hawai’i was under a mandatory 14-day quarantine for both neighbor islands and all incoming travelers, resulting in the carrier operating an extremely limited schedule. On June 16, 2020 Hawai’i lifted the quarantine for neighbor islands only resulting in increased flight activity, though restrictions remained in place for many incoming visitors. In Tuesday’s announcement, Hawaiian Airlines President and CEO, Peter Ingram, said in part,

“Our second quarter results reflect the continued impact of COVID-19 and the State of Hawai’i quarantines on our business. In the face of these unprecedented challenges, we have taken action to preserve and raise cash and are crafting plans to position us for the future even as we address the immediate adversity. With our leisure business model and relentless focus on the needs of the Hawai’i traveler, we are positioned to emerge from this crisis poised for success. I am grateful, as always, for the efforts of my extraordinary colleagues, as they take care of our guests and adapt to this ever-changing environment with passion and dedication.”

Hawaiian Airlines has taken numerous liquidity preservation measures since the onset of the crisis including suspension of dividends and stock repurchases, a hiring freeze, deferral of CAPEX spending, implementation of a voluntary unpaid leave program, reduction of executive pay by 10-50 percent, discretionary spending reduction and negotiated payment deferrals. At the close of the second quarter, the company had received 214.2 million in grants and $49 million in loans under the U.S. Cares Act Payroll Support Program (PSP) and expects to receive an additional $29.2 million during July 2020.

The carrier reported a year-over-year capacity decrease of 86 percent for July and for August, expects to operate 85 percent of capacity versus August 2019. In July, the airline raised an additional $114 million through a sale-leaseback transaction for two Airbus A321neos and signed a non-binding agreement with the U.S. Treasury for Economic Relief Program (ERP) loans under the U.S. Cares Act. Hawaiian Airlines is eligible for up to $364 million in loans under the program and has until March 2021 to decide how much to borrow.

In trading Wednesday morning, shares in Hawaiian Airlines Holdings, Inc. (NASDAQ: HA) were 7.97 percent lower at $12.11/share (11:24 AM EDT).

Source: Hawaiian Airlines