Allegiant earnings up, despite grounding of planes

An Allegiant Airlines jet takes off from McCarran International Airport Friday, August 26, 2011.

Las Vegas-based Allegiant Travel Co., parent company of Allegiant Air, the fifth-busiest commercial airline at McCarran International Airport, reported its third-quarter earnings Wednesday.

Company: Allegiant Travel Co. (Nasdaq: ALGT)

Revenue: $228.9 million (up 5.5 percent from the third quarter of 2012). The number of passengers served increased by 6.3 percent to 1.7 million for the quarter and base fares were up 5.6 percent to an average $86.94. Ancillary revenue from third-party companies, such as hotel and car rental companies, was off 9.5 percent to an average $5.06. But flight-related fees were up 5.2 percent to $38.99 per ticket, resulting in a 4.8 percent increase in revenue on each ticket sold.

Earnings: $17.1 million (up 1 percent from the third quarter of 2012). Allegiant refunded $1 million to passengers as a result of the airline canceling and delaying flights after grounding most of its MD-80 jet fleet to address evacuation slide maintenance issues.

Earnings per share: 91 cents (up 4.6 percent from third quarter of 2012).

What it means: It was the 43rd straight quarter of profitability for Allegiant. The company will add 12 new cities, with service beginning in the next two quarters. It will add 29 new routes in the fourth quarter and service from nine existing cities to Punta Gorda, Fla., in the fourth quarter.

Allegiant said it completed the acquisition of five Airbus A320 jets during the quarter and now has seven in the fleet.

But the company said this month’s federal government shutdown would delay integrating the planes into service, adding fuel and crew expenses because smaller, less-efficient MD-80s would be used on routes instead.

The company enhanced shareholder value by repurchasing 491,000 shares for $47 million during the quarter.

Allegiant also announced that President Andrew Levy would take on the additional role of chief operating officer and has been appointed to the company’s board of directors.

Quote: “We were significantly challenged operationally at the end of September when many of our MD-80s were taken out of service due to an evacuation slide issue. Through the tireless efforts of our team members, we were able to minimize the disruption to our customers.” — Allegiant Chairman and CEO Maurice Gallagher