Alaska has reported a net income of $236 million for the third quarter of the year, compared to net income of $139 million for 202 third quarter.
Alaska completed $2 billion in financing during the three-month period, backed by the company’s mileage plan program. Approximately $1.4 billion was used in October to refinance certain debt acquired with Hawaiian Airlines, which the company says is expected to result in interest cost savings of approximately $30 million over the next 12 months.
The company repurchased over 367,000 shares of common stock for approximately $14 million in the third quarter, bringing total repurchases to $63 million for the nine months ended September 30, 2024. During the same period, Alaska generated $318 million in operating cash flow and reported holding $2.5 billion in unrestricted cash and marketable securities as of September 30, 2024.
At the end of the quarter, the company reported total liquidity of $3.4 billion, which includes approximately $850 million in undrawn lines of credit that were upsized after the Hawaiian acquisition. After the loyalty financing and debt repayments in October, the company's debt-to-capitalisation ratio and net leverage stand at 58% and 2.4x, respectively.
For capital expenditures in 2024, the company expects to incur between $1.2 billion and $1.3 billion, which includes payments for 18 737 Max aircraft, contingent on Boeing's delivery schedule.
Ben Minicucci president and CEO of Alaska Air Group, said: “We have the resources and flexibility to navigate challenges, embrace new opportunities, and write the next chapter for our company. Our industry leading margins and strong operational performance are proof points that we are making the right investments to differentiate ourselves from our domestic-focused peers. Today’s results reinforce we are on the right path for the future.”
On the operational side for the quarter Alaska Airlines added two 737-9 aircraft and one 737-8 aircraft to its fleet. The airline now has 72 737-9s and five 737-8s. Meanwhile, Hawaiian Airlines received its fourth A330-300 freighter from Amazon.
An analyst from TD Cowen commented on the recent results: “Delivery delays are constraining capacity and putting pressure on unit costs. Attrition rates are also at their lowest since 2019. These two factors mean the company has more resources relative to the flying it will be doing. Management is confident they will be able to optimize resources relative to capacity over the course of 2025.”
Consolidated load factor across the group was up 0.9 percentage points when looking at the comparable period of 2023 to 85.5%. Alaska’s consolidated fleet also increased after its merger within Hawaiian during the quarter from 303 aircraft in the third quarter of 2023 to 394 aircraft during the same period of this year.
In a move to enhance passenger connectivity, Hawaiian completed the installation of Starlink high-speed Wi-Fi on its 24 A330 aircraft.