JetBlue Airways reported its results for the third quarter of 2021 which showed GAAP pre-tax earnings of $190 million compared to a pre-tax income of $254 million in the third quarter of 2019. Excluding one-time items, adjusted pre-tax loss of ($50) million(1) in the third quarter of 2021 versus adjusted pre-tax income of $239 million(1) in the third quarter of 2019.
Operational and Financial Highlights from the Third Quarter
Capacity declined by 0.8% year over two, in-line with our planning assumption of a 1% decline, year over two.Revenue declined 5.5% year over two, which is better than our planning assumption of a 6% to 9% decline year over two. This was mainly the result of continued outperformance of our Fare Options initiative, as well as an uptick in demand as we closed out the quarter.Operating expenses per available seat mile decreased 2.1% year over two. Operating expenses per available seat mile, excluding fuel and special items (CASM ex-fuel) (1) increased 12.7%(1) year over two, which is in-line with our planning assumption of an 11% to 13% increase year over two.Adjusted Earnings Before Interest, Taxes, Depreciation, Amortization and Special Items (Adjusted EBITDA) in the third quarter of 2021 was $140 million(1), better than our planning assumption range of $75 to $125 million.
Balance Sheet and Liquidity
As of September 30, 2021, JetBlue’s adjusted debt to capital was 53%(1).JetBlue ended the third quarter of 2021 with approximately $3.3 billion in unrestricted cash, cash equivalents, and short-term investments, or 41% of 2019 revenue. This excludes our $550 million undrawn revolving credit facility.JetBlue repaid $74 million in regularly scheduled debt and finance lease obligations, and prepaid the $115M CARES Act loan and $105M of bank loans.
Fuel Expense and Hedging
The realized fuel price in the third quarter 2021 was $2.08 per gallon, a 1.2% increase versus third quarter 2019 realized fuel price of $2.06.As of October 26, 2021, JetBlue has not entered into forward fuel derivative contracts to hedge its fuel consumption for the third quarter of 2021. Based on the forward curve as of October 15, 2021, JetBlue expects an average all-in price per gallon of fuel of $2.49 in the fourth quarter of 2021.
Accelerating ESG Efforts and Doubling Down On Commitments
At JetBlue, we firmly believe that robust ESG oversight generates value for shareholders. We’ve been transparently reporting on key ESG topics since 2007, with annual ESG reports aligned to SASB and TCFD reporting frameworks since 2017.JetBlue continues to lead the industry in ESG governance, as the first U.S. airline to tie executive compensation to ESG metrics, execute a sustainability-linked loan, and operate an ESG Subcommittee of our Board of Directors.Enabled by our recent deals with SG Preston, Neste, World Energy, and World Fuel Services, we are well ahead of pace to achieve our target of 10 percent SAF usage by 2030.Launched two new programs, Gateway College and Jet Ops to Support Pathway Program, aimed at investing in our crewmembers and provide better access to careers as pilots, in technical ops and support centers.We updated our uniform policy to be more inclusive, including changes to gendered uniforms, size options and hair-style policy.Following a devastating earthquake in Haiti, we transported over 14,000 pounds of supplies and over 150 volunteers from around our operation to support relief efforts.We distributed over 10,000 books to our communities through our JetBlue For Good program Soar with Reading.We logged over 6,400 hours of volunteering service during the third quarter.
The Northeast Alliance Supercharges Competition and Delivers Broader Benefits
The Northeast Alliance has supercharged competition in the Northeast by providing more choices and better service for customers.Together with American, JetBlue launched 58 new routes out of the Northeast, added frequencies on more than 130 routes, and plans to expand to 18 new international destinations.The Northeast Alliance is estimated to generate more than $800 million in consumer benefits annually. JetBlue plans to hire 1,800 new crewmembers for the NEA – jobs that otherwise would not be created without this alliance.
Our Recovery Plan and Actions Taken to Position JetBlue for Future Success
Revenue and Capacity
Financial Performance and Outlook
JETBLUE AIRWAYS CORPORATION | ||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||||
(in millions, except per share amounts) | ||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||
Three Months Ended |
|
| Nine Months Ended |
|
| |||||||||||||||||
September 30, | Percent |
| September 30, | Percent |
| |||||||||||||||||
2021 |
| 2020 |
| Change |
| 2021 |
| 2020 |
| Change |
| |||||||||||
OPERATING REVENUES | ||||||||||||||||||||||
Passenger | $ | 1,856 |
| $ | 445 |
| 317.3 |
| $ | 3,913 |
| $ | 2,126 |
| 84.0 |
| ||||||
Other |
| 116 |
|
| 47 |
| 145.6 |
|
| 290 |
|
| 169 |
| 71.6 |
| ||||||
Total operating revenues |
| 1,972 |
|
| 492 |
| 300.8 |
|
| 4,203 |
|
| 2,295 |
| 83.1 |
| ||||||
OPERATING EXPENSES | ||||||||||||||||||||||
Aircraft fuel and related taxes |
| 443 |
|
| 102 |
| 335.3 |
|
| 973 |
|
| 496 |
| 96.1 |
| ||||||
Salaries, wages and benefits |
| 620 |
|
| 482 |
| 28.6 |
|
| 1,718 |
|
| 1,560 |
| 10.1 |
| ||||||
Landing fees and other rents |
| 182 |
|
| 84 |
| 115.8 |
|
| 470 |
|
| 258 |
| 82.6 |
| ||||||
Depreciation and amortization |
| 140 |
|
| 127 |
| 9.6 |
|
| 398 |
|
| 407 |
| (2.2 | ) | ||||||
Aircraft rent |
| 25 |
|
| 23 |
| 9.5 |
|
| 76 |
|
| 60 |
| 25.7 |
| ||||||
Sales and marketing |
| 60 |
|
| 24 |
| 154.4 |
|
| 130 |
|
| 84 |
| 54.6 |
| ||||||
Maintenance, materials and repairs |
| 205 |
|
| 111 |
| 85.5 |
|
| 472 |
|
| 344 |
| 37.5 |
| ||||||
Other operating expenses |
| 297 |
|
| 167 |
| 78.1 |
|
| 768 |
|
| 560 |
| 37.1 |
| ||||||
Special items |
| (186 | ) |
| (112 | ) | 67.1 |
|
| (841 | ) |
| (214 | ) | 293.8 |
| ||||||
Total operating expenses |
| 1,786 |
|
| 1,008 |
| 77.1 |
|
| 4,164 |
|
| 3,555 |
| 17.1 |
| ||||||
OPERATING INCOME (LOSS) |
| 186 |
|
| (516 | ) | (136.1 | ) |
| 39 |
|
| (1,260 | ) | (103.1 | ) | ||||||
Operating margin |
| 9.4 | % |
| -104.9 | % | 114.3 |
|
| 0.9 | % |
| -54.9 | % | 55.8 |
| pts | |||||
OTHER INCOME (EXPENSE) | ||||||||||||||||||||||
Interest expense |
| (42 | ) |
| (56 | ) | (25.4 | ) |
| (153 | ) |
| (121 | ) | 27.2 |
| ||||||
Capitalized interest |
| 3 |
|
| 3 |
| (10.7 | ) |
| 9 |
|
| 10 |
| (8.6 | ) | ||||||
Gain on equity investments |
| 54 |
|
| - |
| NM |
|
| 54 |
|
| - |
| NM |
| ||||||
Interest income and other |
| (11 | ) |
| (9 | ) | 27.0 |
|
| (49 | ) |
| (10 | ) | 379.0 |
| ||||||
Total other income (expense) |
| 4 |
|
| (62 | ) | (106.5 | ) |
| (139 | ) |
| (121 | ) | 14.9 |
| ||||||
INCOME (LOSS) BEFORE INCOME TAXES |
| 190 |
|
| (578 | ) | (132.9 | ) |
| (100 | ) |
| (1,381 | ) | (92.8 | ) | ||||||
Pre-tax margin |
| 9.6 | % |
| -117.4 | % | 127.0 |
| pts |
| -2.4 | % |
| -60.2 | % | 57.8 |
| pts | ||||
Income tax expense (benefit) |
| 60 |
|
| (185 | ) | (132.6 | ) |
| (47 | ) |
| (400 | ) | (88.4 | ) | ||||||
NET INCOME (LOSS) | $ | 130 |
| $ | (393 | ) | (133.1 | ) | $ | (53 | ) | $ | (981 | ) | (94.6 | ) | ||||||
EARNINGS (LOSS) PER COMMON SHARE: | ||||||||||||||||||||||
Basic | $ | 0.41 |
| $ | (1.44 | ) | $ | (0.17 | ) | $ | (3.58 | ) | ||||||||||
Diluted | $ | 0.40 |
| $ | (1.44 | ) | $ | (0.17 | ) | $ | (3.58 | ) | ||||||||||
WEIGHTED AVERAGE SHARES OUTSTANDING: | ||||||||||||||||||||||
Basic |
| 318.0 |
|
| 272.4 |
|
| 317.3 |
|
| 274.3 |
| ||||||||||
Diluted |
| 321.3 |
|
| 272.4 |
|
| 317.3 |
|
| 274.3 |
| ||||||||||
JETBLUE AIRWAYS CORPORATION | ||||||||||||||||||||||
COMPARATIVE OPERATING STATISTICS | ||||||||||||||||||||||
(unaudited) | ||||||||||||||||||||||
Three Months Ended |
|
| Nine Months Ended |
|
| |||||||||||||||||
September 30, | Percent |
| September 30, | Percent |
| |||||||||||||||||
2021 |
| 2020 |
| Change |
| 2021 |
| 2020 |
| Change |
| |||||||||||
Revenue passengers (thousands) |
| 9,075 |
|
| 2,151 |
| 321.8 |
|
| 21,476 |
|
| 10,918 |
| 96.7 |
| ||||||
Revenue passenger miles (millions) |
| 12,913 |
|
| 2,945 |
| 338.5 |
|
| 29,524 |
|
| 14,153 |
| 108.6 |
| ||||||
Available seat miles (ASMs) (millions) |
| 16,168 |
|
| 6,905 |
| 134.1 |
|
| 38,902 |
|
| 24,209 |
| 60.7 |
| ||||||
Load factor |
| 79.9 | % |
| 42.6 | % | 37.3 |
| pts. |
| 75.9 | % |
| 58.5 | % | 17.4 |
| pts. | ||||
Aircraft utilization (hours per day) |
| 10.1 |
|
| 4.2 |
| 140.5 |
|
| 8.3 |
|
| 5.5 |
| 50.9 |
| ||||||
Average fare | $ | 204.50 |
| $ | 206.73 |
| (1.1 | ) | $ | 182.22 |
| $ | 194.77 |
| (6.4 | ) | ||||||
Yield per passenger mile (cents) |
| 14.37 |
|
| 15.10 |
| (4.8 | ) |
| 13.26 |
|
| 15.02 |
| (11.8 | ) | ||||||
Passenger revenue per ASM (cents) |
| 11.48 |
|
| 6.44 |
| 78.2 |
|
| 10.06 |
|
| 8.78 |
| 14.5 |
| ||||||
Revenue per ASM (cents) |
| 12.20 |
|
| 7.12 |
| 71.2 |
|
| 10.80 |
|
| 9.48 |
| 14.0 |
| ||||||
Operating expense per ASM (cents) |
| 11.04 |
|
| 14.60 |
| (24.3 | ) |
| 10.70 |
|
| 14.69 |
| (27.1 | ) | ||||||
Operating expense per ASM, excluding fuel (cents)(1) |
| 9.39 |
|
| 14.64 |
| (35.9 | ) |
| 10.29 |
|
| 13.40 |
| (23.2 | ) | ||||||
Departures |
| 76,918 |
|
| 32,124 |
| 139.4 |
|
| 188,220 |
|
| 128,315 |
| 46.7 |
| ||||||
Average stage length (miles) |
| 1,320 |
|
| 1,313 |
| 0.5 |
|
| 1,293 |
|
| 1,201 |
| 7.7 |
| ||||||
Average number of operating aircraft during period |
| 275.9 |
|
| 262.9 |
| 4.9 |
|
| 270.4 |
|
| 261.3 |
| 3.5 |
| ||||||
Average fuel cost per gallon, including fuel taxes | $ | 2.08 |
| $ | 1.23 |
| 69.7 |
| $ | 1.94 |
| $ | 1.60 |
| 21.3 |
| ||||||
Fuel gallons consumed (millions) |
| 213 |
|
| 83 |
| 156.4 |
|
| 501 |
|
| 310 |
| 61.6 |
| ||||||
Average number of full-time equivalent crewmembers |
| 16,088 |
|
| 16,004 |
|
(1) Refer to Note A at the end of our Earnings Release for more information on this non-GAAP financial measure. Operating expense per available seat mile, excluding fuel (“CASM Ex-Fuel”) excludes fuel and related taxes, other non-airline operating expenses, and special items. |
JETBLUE AIRWAYS CORPORATION | |||||
SELECTED CONSOLIDATED BALANCE SHEET DATA | |||||
(in millions) | |||||
September 30, |
| December 31, | |||
2021 |
| 2020 | |||
(unaudited) |
|
| |||
Cash and cash equivalents | $ | 2,193 | $ | 1,918 | |
Total investment securities |
| 1,101 |
| 1,137 | |
Total assets |
| 14,069 |
| 13,406 | |
Total debt |
| 4,151 |
| 4,863 | |
Stockholders' equity |
| 3,949 |
| 3,951 | |
|
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