Spirit Airlines Revenue Dips Amid Merger Woes With JetBlue

Spirit Airlines Inc SAVE reported a fourth-quarter fiscal 2023 revenue decline of 5% Y/Y to $1.322 billion, beating the consensus of $1.317 billion. 

Adjusted EPS loss was $(1.36), down from $0.12, beating the consensus of $(1.46).

Passenger revenues fell 5.3% Y/Y to $1.296 billion, while other revenue rose 15.7% Y/Y to $25.0404 million.  

Total revenue per ASM was 8.94 cents, down 17.3% Y/Y. Total revenue per passenger flight segment dipped 15.3% Y/Y to $114.84. 

Fare revenue per segment was down 25% Y/Y to $48.24, and non-ticket revenue per segment grew 6.6% Y/Y to $66.60. 

For the fourth quarter, the load factor contracted 0.9ppt Y/Y to 80.1%. Aircraft utilization in the fourth quarter was 11.2 hours, up 3.7% compared to the 10.8 hours in the same period last year. The aircraft utilization was constrained in the quarter due to engine availability issues primarily driven by unscheduled engine maintenance events.

Merger Update: On January 16, 2024, the Court granted an injunction against the Merger. On January 19, 2024, Spirit and JetBlue Airways Corporation JBLU filed a notice of appeal and to reverse the Injunction and allow Spirit and JetBlue to complete the Merger. On February 2, 2024, the Court of Appeals granted the motion, stating it would hear arguments in June 2024.

Related: JetBlue CEO Comments “We Strongly Disagree With The Court’s Ruling”, Requests Expedited Appeal

In the fourth quarter, it took delivery of four aircraft, with two A320neo and two A321neo aircraft, retired one A319ceo aircraft, and had 205 aircraft in its fleet at the end of the quarter.

Total capital expenditures for the fiscal stood at $232.4 million, especially related to building a new headquarters campus in Florida and purchasing spare parts.

SAVE ended the quarter with unrestricted cash and cash equivalents, short-term investment securities, and liquidity available under its revolving credit facility of $1.3 billion.

Price Action: SAVE shares are trading flat at $6.95 on the last check Thursday.

Photo via Wikimedia Commons