Hurricanes linked to revenue losses at Spirit Airlines

3rd-quarter numbers down by $40 million

MIRAMAR – Three hurricanes that barreled across key markets in Texas, Florida and the Caribbean helped to pare Spirit Airlines’ third-quarter operating revenues by $40 million, the lowcost carrier reported Thursday.

Hurricanes Harvey, Irma and Maria, together with the lingering impact of a pilots’ work slowdown earlier this year, negatively affected the quarter’s revenue by $40 million, Spirit said in an earnings news release. The storms forced the cancellation of more than a thousand flights and incurred other costs beyond the loss of passenger ticket money.

The Miramar-based airline’s quarterly net profit declined 26 percent to $60.2 million or 87 cents a share compared to $81.3 million or $1.17 cents in 2016.

But despite the storms’ impact, the carrier’s operating revenue still rose 10.6 percent to $687.2 million, from $621.3 million, a year ago. The increase came mainly from non-ticket revenues such as fees.

“Multiple hurricanes during the third quarter 2017 caused us to cancel over 1,650 flights,” said Robert Fornaro, Spirit’s president and CEO in a statement. “I am very proud of how the Spirit team pulled together to assist our guests and employees in the regions affected by the storms while keeping the rest of the network running smoothly and still delivering solid financial results.”

Spirit’s quarterly adjusted net earnings per share of 94 cents and revenue of $687.2 million, beat analysts’ estimates of 90 cents and $686.6 million respectively, according to the Zacks Consensus Estimate. Those results helped push the company’s stock up nearly 7 percent to $36.08 in Nasdaq trading Thursday.

In advance of Irma’s surge over Florida, Spirit had to relocate its flight operations control center and more than 300 employees to its backup facility in Detroit, where it conducted systemwide operations for about a week, Fornaro said.

He called the third quarter “challenging” on many fronts and lauded his employees for volunteering to assist with the relief efforts.

During an earnings call with financial analysts, Matt Klein, a Spirit senior vice president, said the airline is seeing some lingering impact from Hurricane Harvey in the fourth quarter that was modestly affecting its Houston area market. In Florida, there were no significant residual effects from Irma.