Hawaiian Holdings Inc. on Tuesday reported a loss of $50.2 million in its fourth quarter, and enters this year with a financial performance that Peter Ingram, Hawaiian’s president and CEO, said “remains quite a ways from being fully recovered.”
The Honolulu-based company said it had a loss of 98 cents per share during the fourth quarter. Losses, adjusted for nonrecurring costs, came to 49 cents per share.
The fourth-quarter results surpassed Wall Street expectations. The average estimate of three analysts surveyed by Zacks Investment Research was for a loss of 71 cents per share. The parent company of Hawaiian Airlines posted revenue of $731 million in the period, falling short of Street forecasts. Three analysts surveyed by Zacks expected $737.6 mil-lion.
For full year 2022 the company reported that its loss widened to $240.1 million, or $4.67 per share. Revenue was reported as $2.64 billion.
Ingram said during an earnings call Tuesday that “the natural question for investors is to wonder why it is taking Hawaiian longer to return to profitability than other U.S. airlines.”
He said Hawaiian’s cost outlook is relative to other U.S. airlines but that its revenue is where its 2022 results and near-term outlook diverge from its peers.
“Not because we are underperforming our competitors on specific routes, but because of the characteristics of the markets in which we compete,” Ingram said. “We don’t control the timing of demand recovery from Japan, we only make decisions on one side of the neighbor island competitive battle. And even in North America — the North America-to-Hawaii market, which is operating profitably, the supply-demand environment relative to 2019 is less favorable than in the domestic 48 and trans-Atlantic markets. As a result, I can’t project the timing of return to profitability as precisely as I would like.”
Ingram said that in recent weeks Hawaiian has slowed the deployment of capacity to Japan. “While we remain confident that with time the long-standing affinity of Japanese travelers for Hawaii vacations will manifest, we also need to be pragmatic in putting capacity elsewhere if recovery remain slow,” he said.
Brent Overbeek, Hawaiian’s senior vice president and chief revenue officer, also noted that softness in North America bookings for travel in the first quarter emerged at the end of 2022. However, Overbeek said that “these have improved over recent weeks, and we’re encouraged with booking intakes, even with some fares discounting initiated by other carriers.”
Last quarter, Ingram talked at length about the competitive situation with Southwest Airlines on its neighbor island routes, which suppressed near-term financial performance. During this earnings call, he said, “We’re standing our ground and remain resolute that we will win in the end and emerge stronger on the other side.”
Overbeek added, “Our competitor is no longer offering $39 last-seat availability, as they were for much of the second half of 2022, but low fares are widely available in the market.”
He said, “The most recent DOT statistics show that for the third quarter our load factor (percentage of available seats filled) was 22 points higher than our competitor, and our average fare of roughly $51 was nearly double theirs.”
Ingram said Hawaiian is focused on what it can control from unlocking operational efficiencies to investing in a continuum of initiatives to position the company for sustained success.
Hawaiian’s stock rose 56 cents to $12.32 during the regular trading session but then plunged 11.4%, or $1.40, to $10.92 after hours.
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The Associated Press contributed to this story.
FOURTH-QUARTER LOSS
$50.2 million
2019 FOURTH- QUARTER NET
$49.7 million
