Hawaiian Holdings Reports 2022 Third Quarter Financial Results

“We enjoyed strong demand for travel to Hawaiʻi this summer led by our North America routes and are encouraged to see these trends continue into the fall, while the relaxation of travel restrictions in Japan sets the stage for the full restoration of our network in the months ahead,” said Peter Ingram, president and CEO at Hawaiian Airlines. “Our competitive position is strong.  And above all else we continue to have the best team in the business that has taken on every challenge over the last few years and continues to deliver outstanding service and hospitality.”

Financial Results

Third Quarter 2022

The Company reported:

• GAAP net loss of $(9.3) million , and an adjusted net loss of $(7.7) million .
• GAAP EPS of $(0.18) , and adjusted EPS of $(0.15) .
• EBITDA of $46.8 million , and adjusted EBITDA of $47.9 million .

Third Quarter 2022 Highlights

Revenue Environment

The Company continued to enjoy strong demand throughout its domestic network and is seeing a solid recovery in its international network. The Company’s overall operating revenue was down 1.9% from third quarter 2019 as its international network is still rebuilding.

Other revenue was up 28.2% compared to the third quarter of 2019 driven by a strong quarter of cargo revenue and sales of HawaiianMiles.

Amazon Agreement

On October 21, 2022 , the Company announced an eight-year agreement with Amazon to provide flight operations and maintenance services for Amazon’s air cargo operation.  Amazon will provide a minimum of 10 A330-300 freight aircraft, and the Company will provide crew and line maintenance for this fleet.  The initial aircraft are scheduled to enter service in the second half of 2023.  In support of this business, the Company will open mainland base(s) for crew and maintenance.  Under the agreement, Amazon can grow its fleet with Hawaiian above the initial 10 aircraft and extend the contract beyond the initial eight-year term.  This agreement will provide the Company with a new long-term diversified stream of revenue with no aircraft acquisition costs.  As part of the agreement, Amazon will receive warrants to acquire up to 9.4 million of the Company’s common shares vesting over nine years.

Routes and Network

During the third quarter of 2022, the Company operated at 93% of its 2019 third quarter system capacity, comprised of 116%, 82% and 52% capacity on its North America , Neighbor Island and International routes, respectively.

Liquidity and Capital Resources

As of September 30, 2022, the Company had:

• Unrestricted cash, cash equivalents and short-term investments of $1.4 billion
• $1.7 billion in liquidity, including its undrawn $235 million revolving credit facility
• Outstanding debt and finance lease obligations of $1.7 billion
• Air traffic liability and current frequent flyer deferred revenue of $700 million

Operational Excellence

In August 2022 , the Company announced a partnership with Honolulu Community College to increase access to Aviation Maintenance Technician careers. The partnership will enable the college to double the number of students enrolled in the Aeronautics Maintenance Technology program by fall of 2023. One component of this program is the opportunity for students to take classes during the day while also participating in a paid part-time apprenticeship at Hawaiian Airlines.

Awards and Recognition

In August 2022 , Forbes named Hawaiian Airlines as Hawai’i’s Best Employer as part of the 2022 America’s Best Employers by State rankings.

Environmental, Social and Corporate Governance

In August 2022 , the Company awarded a $100,000 grant to Kākoʻo ʻŌiwi, a nonprofit organization dedicated to advancing the cultural, spiritual and traditional practices of the Native Hawaiian community. The grant will fund the construction of a wash and pack facility in Heʻeia that can be accessed by area farmers to process locally grown crops.

Fourth Quarter 2022 Outlook

The Company expects its capacity for the quarter ending December 31, 2022 to be down approximately 4% to down 7% compared to the fourth quarter of 2019, mostly driven by the delay of the full restoration of its Japan network.

The Company expects its total revenue for the quarter ending December 31, 2022 to be up 1.5% to up 5.5% compared to the fourth quarter of 2019.

The Company expects its CASM excluding fuel and non-recurring items for the quarter ending December 31, 2022 to be up approximately 13% to 16% compared to the fourth quarter of 2019.

The Company’s outlook for adjusted EBITDA for the quarter ending December 31, 2022 is – $5 million to $35 million .

The table below summarizes the Company’s expectations for the quarter ending December 31, 2022 expressed as an expected percentage change compared to the results for the quarter ended December 31, 2019 .

Statistical information, as well as a reconciliation of certain non-GAAP financial measures, can be found in the accompanying tables.

Full Year 2022 Outlook

The table below summarizes the Company’s updated expectations for the full year ending December 31, 2022 expressed as an expected percentage change compared to the results for the year ended December 31, 2019 .

(a) Fuel Price per Gallon estimates are based on the October 13, 2022 fuel forward curve

Investor Conference Call

Hawaiian Holdings’ quarterly results conference call is scheduled to begin today, October 25, 2022, at 4:30 p.m. Eastern Time ( USA ).  The conference call will be broadcast live over the Internet. Investors may access and listen to the live audio webcast on the investor relations section of the Company’s website at HawaiianAirlines.com . For those who are not available for the live webcast, a replay of the webcast will be archived for 90 days on the investor relations section of the Company’s website.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect the Company’s current views with respect to certain current and future events and financial performance.  Such forward-looking statements include, without limitation, the Company’s ability, timing and progress in recovering from the impacts of COVID-19 pandemic; the Company’s timing and expectations related to network and route recovery; future domestic and international demand for air travel; expectations and outcomes related to the Company’ cargo deal with Amazon; the outcomes of the Company’s partnership with Honolulu Community College ; the outcomes of the Company’s grant to Kākoʻo ʻŌiwi; the Company’s outlook for the quarter ending December 31, 2022 and twelve-months ending December 31, 2022 ; the Company’s expectations and plans related to the restatement of its financial statements for the quarters ended March 31, 2022 and June 30, 2022 and statements as to other matters that do not relate strictly to historical facts or statements of assumptions underlying any of the foregoing.  Words such as “expects,” “anticipates,” “projects,” “intends,” “plans,” “believes,” “estimates,” variations of such words, and similar expressions are also intended to identify such forward-looking statements.  These forward-looking statements are and will be subject to many risks, uncertainties and assumptions relating to the Company’s operations and business environment, all of which may cause the Company’s actual results to be materially different from any future results, expressed or implied, in these forward-looking statements.  These risks and uncertainties include, without limitation, the continuing and developing effects of the spread of COVID-19 on the Company’s business operations and financial condition; fluctuations and the extent of declining demand for air transportation in the markets in which the Company operates; the Company’s dependence on the tourism industry; current macroeconomic conditions, including inflationary pressures; the Company’s ability to accurately forecast economic volatility; macroeconomic developments; political developments; geopolitical conflict; the price and availability of aircraft fuel; labor negotiations; supply chain constraints; regulatory determinations and related developments; competitive pressures, including the impact of industry capacity between North America and Hawai’i and interisland; changes in the Company’s future capital needs; foreign currency exchange rate fluctuations; the outcome of the Company’s evaluation of its accounting with respect to previously issued financial statements, including the possibility of material adjustments thereto; the discovery of additional and unanticipated information during the procedures required to be completed before the Company is able to file its required restated reports for the quarters ended March 31, 2022 and June 30, 2022 ; and the application of accounting or tax principles in an unanticipated manner.

The risks, uncertainties and assumptions referred to above that could cause the Company’s results to differ materially from the results expressed or implied by such forward-looking statements also include the risks, uncertainties and assumptions discussed from time to time in the Company’s other public filings and public announcements, including the Company’s Annual Report on Form 10-K and the Company’s Quarterly Reports on Form 10-Q, as well as other documents that may be filed by the Company from time to time with the Securities and Exchange Commission.  All forward-looking statements included in this document are based on information available to the Company on the date hereof.  The Company does not undertake to publicly update or revise any forward-looking statements to reflect events or circumstances that may arise after the date hereof even if experience or future changes make it clear that any projected results expressed or implied herein will not be realized.