In line with other US carriers, Frontier Airlines, has updated previously issued guidance for the third quarter of 2023, to reflect both a “recent significant unexpected change in the booking trajectory along with higher fuel prices and a greater volume of recent operational cancellations than forecast”.
In recent weeks, sales have been trending below historical seasonality patterns, says Frontier, adding that fuel prices for the quarter are expected to average approximately 23 cents per gallon more than previously forecast. Operational cancellation levels have also been “elevated relative to management’s earlier guidance for the quarter driven in part by the impact of Tropical Storm Hilary and Hurricane Idalia, as well as continued challenges with the operating environment”.
The impact from these items Frontier says will result in an adjusted (non-GAAP) pre-tax margin for the quarter of between (4) to (7) percent. Frontier expects its capacity growth compared to the third quarter of 2022 to be between 20% and 21%, less that the previous expected growth of between 21% and 23%. On an adjusted basis, Frontier expects its ex-fuel costs to be $645 million to $655 million, down from prior expectations of $650 million to $665 million.