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JetBlue Airways (JBLU) Posts Q1 Loss Amid Coronavirus Woes

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JetBlue Airways (JBLU - Free Report) incurred a first-quarter 2021 loss (excluding 70 cents from non-recurring items) of $1.48 per share, comparing favorably with the Zacks Consensus Estimate of a loss of $1.62.

Results were hurt by the coronavirus-induced weakness in air-travel demand. Notably, this is the fifth successive quarterly loss posted by the currently Zacks Rank #3 (Hold) low-cost carrier. In the first quarter of 2020, JetBlue reported a quarterly loss of 42 cents per share.

Moreover, in first-quarter 2021, operating revenues of $733 million plunged 53.8% year over year due to the 55.7% decrease in passenger revenues, which accounted for bulk (91.4%) of the top line. Revenues from other sources also declined 18% to $63 million. The top line, however, surpassed the Zacks Consensus Estimate of $716.4 million.

JetBlue Airways Corporation Price, Consensus and EPS Surprise

JetBlue Airways Corporation Price, Consensus and EPS Surprise

JetBlue Airways Corporation price-consensus-eps-surprise-chart | JetBlue Airways Corporation Quote

Other Details

All comparisons are presented on a year-over-year basis. Revenue per available seat mile (RASM: a key measure of unit revenues) in the reported quarter dropped 24.5% to 8.06 cents. Passenger revenue per available seat mile (PRASM) fell 27.5% to 7.36 cents. Average fare at JetBlue during the quarter declined 19.1% to $149.97. Yield per passenger mile dropped 20.8% year over year to 11.52 cents.

Capacity, measured in available seat miles, contracted 39%. Traffic, measured in revenue passenger miles, plummeted 44.1% due to softness in air-travel demand. Load factor (percentage of seats filled by passengers) fell to 63.9% from 69.8% a year ago as traffic decline was more than the capacity reduction in the reported quarter.

In the first quarter, total operating expenses (on a reported basis) decreased 46.6% year over year, mainly owing to a 47% fall in aircraft fuel and related taxes. With major part of the fleet remaining grounded/under-utilized, fuel gallons consumed tanked 42.8% to 112 million.

Average fuel cost per gallon (including fuel taxes) declined 7.4% to $1.72. JetBlue’s operating expenses per available seat mile (CASM) fell 12.5% to 11.30 cents. Excluding fuel, the metric escalated 36% to 12.25 cents.

JetBlue exited the first quarter of 2021 with cash and cash equivalents of $2,358 million compared with $1,918 million at the end of 2020. Total debt at the end of the reported quarter was $5,082 million compared with $4,863 million at 2020 end.

The carrier exited the March quarter with $3.2 billion in unrestricted cash, cash equivalents and short-term investments. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Outlook

Revenues for the second quarter of 2021 are expected to decline in the 30-35% range from the second-quarter 2019 actuals.  Capacity is anticipated to contract at least 15% in the June quarter from the figure reported in the second quarter of 2019. Operating expenses are expected to be roughly 8% down from the recorded second-quarter 2019 levels. Average fuel cost per gallon in the June quarter is estimated to be $1.87.  EBITDA is expected in the range of a negative $100-$200 million. The company expects to reach breakeven in the third quarter of 2021, on an EBITDA basis.

How Other Airlines Fared

Let’s take a look at some of the other recently-released earnings reports of companies from within the Zacks Airline industry.

United Airlines (UAL - Free Report) incurred a loss (excluding $3.21 from non-recurring items) of $7.5 per share in the first quarter of 2021, wider than the Zacks Consensus Estimate of a loss of $6.97. This is the fifth consecutive quarterly loss incurred by the company as coronavirus continues to weigh on air-travel demand. Operating revenues of $3,221 million also fell short of the Zacks Consensus Estimate of $3,253.1 million.

Delta Air Lines’ (DAL - Free Report) first-quarter 2021 loss (excluding $1.70 from non-recurring items) of $3.55 per share was wider than the Zacks Consensus Estimate of $3.08 as well as the first-quarter 2020 loss of 51 cents.

American Airlines (AAL - Free Report) incurred a loss (excluding $2.35 from non-recurring items) of $4.32 per share, comparing favorably with the Zacks Consensus Estimate of a loss of $4.35. However, quarterly loss per share was wider than the year-ago loss of $2.65. Moreover, operating revenues of $4,008 million slumped 52.9% year over year and also fell shy of the Zacks Consensus Estimate of $4,031 million

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