Q4 2024 Alaska Air Group Inc Earnings Call Transcript
Key Points
- Alaska Air Group Inc (ALK) reported a strong fourth-quarter and full-year GAAP net income of $71 million and $395 million, respectively, with adjusted net income of $125 million and $625 million.
- The company exceeded its guidance with an adjusted EPS of $0.97 for Q4 and $4.87 for the full year 2024.
- ALK aggressively repurchased $248 million in shares during December, fully exhausting its existing program, and launched a new $1 billion share repurchase program in January.
- The acquisition of Hawaiian Airlines has strengthened ALK's strategic assets, including a leading position in a top 25 US hub and a valuable brand.
- ALK's loyalty programs generated $2.1 billion in cash remuneration in 2024, with strong initial demand for its new premium credit card and the Huaka'i by Hawaiian loyalty benefits program gaining traction.
- The four-week grounding of the 9 MAX aircraft negatively impacted ALK's results, preventing it from posting the best margin in the industry.
- ALK expects its Hawaiian assets to be unprofitable in Q1 2025, although a small pretax profit is anticipated from Q2 onwards.
- Fourth-quarter unit costs were up 8.6% year over year, with performance-based pay accruals contributing to the increase.
- ALK's first-quarter earnings are expected to result in a loss per share of $0.50 to $0.70, reflecting normal seasonality but still a material improvement year over year.
- The integration of Hawaiian Airlines is still in progress, with a single operating certificate and unified reservation system expected by the end of 2025.
Good morning, ladies and gentlemen, and welcome to the Alaska Air Group 2024 fourth-quarter earnings call. (Operator Instructions) Today's call is being recorded and will be accessible for future playback at alaskaair.com. (Operator Instructions)
I would now like to turn the call over to Alaska Air Group's Vice President of Finance, Planning, and Investor Relations, Ryan St. John.
Thank you, operator, and good morning. Thank you for joining us for our fourth-quarter 2024 earnings call. Yesterday, we issued our earnings release along with several accompanying slides detailing our results, which are available at investor.alaskaair.com.
On today's call, you'll hear updates from Ben, Andrew, and Shane. Several others of our management team are also on the line to answer your questions during the Q&A portion of the call.
This morning, Air Group reported fourth-quarter and full-year GAAP net income of $71 million and $395 million,
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