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Alaska Air (ALK) Q4 Earnings & Revenues Surpass Estimates
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Alaska Air Group, Inc. (ALK - Free Report) reported fourth-quarter 2023 earnings per share (EPS) of 30 cents, which beat the Zacks Consensus Estimate of 18 cents but declined 67.4% year over year.
Operating revenues of $2,553 million missed the Zacks Consensus Estimate of $2,548.1 million. The top line jumped 3% year over year, with passenger revenues accounting for 91.1% of the top line and increasing 3% owing to continued recovery in air-travel demand.
Passenger revenues totaled $2,326 million in the reported quarter. On a year-over-year basis, cargo and other revenues of $62 million grew 7% year over year. Mileage plan other revenues grew 5% to $165 million.
Alaska Air Group, Inc. Price, Consensus and EPS Surprise
Total revenue per available seat mile (a key measure of unit revenues) fell 9% year over year to 14.95 cents. Yield decreased 7% to 16.43 cents.
Reflecting the uptick in air-travel demand, consolidated traffic (measured in revenue passenger miles) rose 10% to 14.15 billion. To cater to this increased demand, capacity (measured in average seat miles) expanded 14% to 17.07 billion. Consolidated load factor (percentage of seats filled by passengers) decreased 2.6 percentage points to 82.9% in the fourth quarter of 2023. The actual figure for load factor was also lower than our expectation of 87.1%.
In the fourth quarter, total operating expenses (on a reported basis) grew 3% year over year to $2,521 million.
Economic fuel price per gallon fell 4% to $3.42. The actual figure was higher than our estimate of $3.40.
Consolidated operating costs per available seat mile (excluding fuel and special items) fell 7% year over year to 10.40 cents. The actual figure was lower than our estimate of 10.61 cents.
Liquidity
As of Dec 31, 2023, Alaska Air had $1,791 million of cash and marketable securities compared with $2,451 million at the end of September 2023.
ALK exited the fourth quarter of 2023 with long-term debt (net of current portion) of $2,182 million compared with $2,128 million at the end of September 2023. Debt-to-capitalization ratio was 46%.
ALK utilized $53 million of cash in operating activities in the fourth quarter. During the fourth quarter of 2023, ALK repurchased nearly 2 million shares for $75 million.
Outlook
ALK anticipates full-year 2024 adjusted EPS between $3.00 and $5.00. This guidance includes a $150 million negative impact from the grounding of the company's Boeing 737-9 MAX fleet and assumes a gradual return to service of the 737-9 MAX fleet through early February.
J.B. Hunt Transport Services, Inc.’s (JBHT - Free Report) fourth-quarter 2023 earnings of $1.47 per share missed the Zacks Consensus Estimate of $1.74 and declined 23.4% year over year.
JBHT’s total operating revenues of $3,303.70million surpassed the Zacks Consensus Estimate of $3,236.2 million but fell 9.5% year over year. Total operating revenues, excluding fuel surcharge revenue, fell 6% year over year.
Delta Air Lines (DAL - Free Report) has reported fourth-quarter 2023 earnings (excluding $1.88 from non-recurring items) of $1.28 per share, which comfortably beat the Zacks Consensus Estimate of $1.17. Earnings, however, declined 13.51% on a year-over-year basis due to high labor costs.
DAL's revenues of $14,223 million surpassed the Zacks Consensus Estimate of $14,069.5 million and increased 5.87% on a year-over-year basis, driven by strong holiday-air-travel demand. Adjusted operating revenues (excluding third-party refinery sales) came in at $13,661 million, up 11% year over year.
United Airlines Holdings, Inc. (UAL - Free Report) reported fourth-quarter 2023 earnings per share (excluding 19 cents from non-recurring items) of $2.00, which outpaced the Zacks Consensus Estimate of $1.61 but declined 18.7% year over year.
UAL's operating revenues of $13,626 million beat the Zacks Consensus Estimate of $13,546.8 million. The top line increased 9.9% year over year due to upbeat air-travel demand. This was driven by a 10.9% rise in passenger revenues (accounting for 91.1% of the top line) to $12,421 million. Almost 41,779 passengers traveled on UAL flights in the fourth quarter.
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Alaska Air (ALK) Q4 Earnings & Revenues Surpass Estimates
Alaska Air Group, Inc. (ALK - Free Report) reported fourth-quarter 2023 earnings per share (EPS) of 30 cents, which beat the Zacks Consensus Estimate of 18 cents but declined 67.4% year over year.
Operating revenues of $2,553 million missed the Zacks Consensus Estimate of $2,548.1 million. The top line jumped 3% year over year, with passenger revenues accounting for 91.1% of the top line and increasing 3% owing to continued recovery in air-travel demand.
Passenger revenues totaled $2,326 million in the reported quarter. On a year-over-year basis, cargo and other revenues of $62 million grew 7% year over year. Mileage plan other revenues grew 5% to $165 million.
Alaska Air Group, Inc. Price, Consensus and EPS Surprise
Alaska Air Group, Inc. price-consensus-eps-surprise-chart | Alaska Air Group, Inc. Quote
Total revenue per available seat mile (a key measure of unit revenues) fell 9% year over year to 14.95 cents. Yield decreased 7% to 16.43 cents.
Reflecting the uptick in air-travel demand, consolidated traffic (measured in revenue passenger miles) rose 10% to 14.15 billion. To cater to this increased demand, capacity (measured in average seat miles) expanded 14% to 17.07 billion. Consolidated load factor (percentage of seats filled by passengers) decreased 2.6 percentage points to 82.9% in the fourth quarter of 2023. The actual figure for load factor was also lower than our expectation of 87.1%.
In the fourth quarter, total operating expenses (on a reported basis) grew 3% year over year to $2,521 million.
Economic fuel price per gallon fell 4% to $3.42. The actual figure was higher than our estimate of $3.40.
Consolidated operating costs per available seat mile (excluding fuel and special items) fell 7% year over year to 10.40 cents. The actual figure was lower than our estimate of 10.61 cents.
Liquidity
As of Dec 31, 2023, Alaska Air had $1,791 million of cash and marketable securities compared with $2,451 million at the end of September 2023.
ALK exited the fourth quarter of 2023 with long-term debt (net of current portion) of $2,182 million compared with $2,128 million at the end of September 2023. Debt-to-capitalization ratio was 46%.
ALK utilized $53 million of cash in operating activities in the fourth quarter. During the fourth quarter of 2023, ALK repurchased nearly 2 million shares for $75 million.
Outlook
ALK anticipates full-year 2024 adjusted EPS between $3.00 and $5.00. This guidance includes a $150 million negative impact from the grounding of the company's Boeing 737-9 MAX fleet and assumes a gradual return to service of the 737-9 MAX fleet through early February.
Currently, Alaska Air carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performances of Other Transportation Companies
J.B. Hunt Transport Services, Inc.’s (JBHT - Free Report) fourth-quarter 2023 earnings of $1.47 per share missed the Zacks Consensus Estimate of $1.74 and declined 23.4% year over year.
JBHT’s total operating revenues of $3,303.70million surpassed the Zacks Consensus Estimate of $3,236.2 million but fell 9.5% year over year. Total operating revenues, excluding fuel surcharge revenue, fell 6% year over year.
Delta Air Lines (DAL - Free Report) has reported fourth-quarter 2023 earnings (excluding $1.88 from non-recurring items) of $1.28 per share, which comfortably beat the Zacks Consensus Estimate of $1.17. Earnings, however, declined 13.51% on a year-over-year basis due to high labor costs.
DAL's revenues of $14,223 million surpassed the Zacks Consensus Estimate of $14,069.5 million and increased 5.87% on a year-over-year basis, driven by strong holiday-air-travel demand. Adjusted operating revenues (excluding third-party refinery sales) came in at $13,661 million, up 11% year over year.
United Airlines Holdings, Inc. (UAL - Free Report) reported fourth-quarter 2023 earnings per share (excluding 19 cents from non-recurring items) of $2.00, which outpaced the Zacks Consensus Estimate of $1.61 but declined 18.7% year over year.
UAL's operating revenues of $13,626 million beat the Zacks Consensus Estimate of $13,546.8 million. The top line increased 9.9% year over year due to upbeat air-travel demand. This was driven by a 10.9% rise in passenger revenues (accounting for 91.1% of the top line) to $12,421 million. Almost 41,779 passengers traveled on UAL flights in the fourth quarter.