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Sep 30, 2023
Frontier Q3 2023 Earnings Report
Frontier's financial performance was impacted by elevated fuel prices, uneven demand recovery, and operational disruptions.
Key Takeaways
Frontier Group Holdings reported a total operating revenue of $883 million, a 3% decrease compared to the same quarter in 2022. The company faced challenges including elevated fuel prices, uneven demand recovery, and operational disruptions, resulting in a pre-tax loss of $(45) million and a net loss of $(32) million.
Total operating revenues were $883 million, 3 percent lower than the 2022 quarter, on capacity growth of 21 percent.
Cost per available seat mile (CASM) was 9.66 cents, a decline of 9 percent over the 2022 quarter.
Pre-tax margin was (5.1) percent.
The company took delivery of eight A321neo aircraft during the third quarter, increasing the proportion of the fleet comprised of the more fuel-efficient A320neo family aircraft to 77 percent as of September 30, 2023.
Revenue by Segment
Forward Guidance
Looking to the fourth quarter, stage-adjusted, non-fuel unit costs are expected to sequentially improve and booking volume has stabilized, driven by low fare stimulation albeit at higher fuel prices.
Positive Outlook
- Stage-adjusted, non-fuel unit costs are expected to sequentially improve.
- Booking volume has stabilized.
- Low fare stimulation is driving booking volume.
- Capacity is expected to grow by 12% to 14% over the comparable 2022 quarter.
- Effective tax rate of 20%.
Challenges Ahead
- Higher fuel prices.
- Adjusted (non-GAAP) pre-tax margin (excluding special items) is expected to be (6) percent to (9) percent, including the impact of the higher fuel cost environment.
- Average fuel cost per gallon is expected to be $3.20 to $3.30.
- Adjusted (non-GAAP) total operating expenses (excluding fuel) are expected to be $655 to $665 million.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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