Allegiant Travel Company · NASDAQ:ALGT
Allegiant Travel — Investor Presentation (March 2010)
23 slides from Allegiant Travel's investor presentation, Mar 8, 2010
Slide 1: Management Presentation March 2010
Management Presentation March 2010
Slide 2: Notice on Forward Looking Statements
Notice on Forward Looking Statements This presentation as well as oral statements made by officers or directors of Allegiant Travel Company, its advisors and affiliates (collectively or separately, the "Company") will contain forward-looking statements that are only predictions and involve risks and
Slide 3: Highlights
Highlights $mm Highly profitable: 2009 21.6% pre-tax margin Profitable last 28 quarters(1) $154mm 2009 EBITDAR(2) Very strong balance sheet: More cash than debt Ample liquidity 2009 free cash flow $120mm(2) Healthy growth (ASMs): 2006-2009 CAGR 24% 5 yr forward CAGR 15% Revenue Pre-tax Profit Pre-ta
Slide 4: Best Margins
Best Margins Pre-tax margins Industry-leading margins in all environments Recession Runaway Oil “Normal”
Slide 5: Strong Balance Sheet
(1) All data based on reported LTM ending 12/31/2009 (2) Adjusted debt equals total debt plus LTM aircraft rent capitalized at 7.0x; Adjusted net debt equals adjusted debt less unrestricted cash and short-term investments (3) End of the period data; includes aircraft on capital leases and owned airc
Slide 6: We Love Our Shareholders
We Love Our Shareholders Change in fully-diluted share count, 1Q07 to 4Q09 Management’s interests aligned with other shareholders thru significant ownership stakes
Slide 7: Nationwide Network
Nationwide Network Published(2) June 30, 2010 schedule: 138 routes, ~50 operating aircraft 57 small cities 11 leisure destinations 8 bases 1) Service to both Orlando-Sanford International Airport and Orlando International Airport 2) As of March 5, 2010
Slide 8: Best Costs – 2009 Per Pax
Best Costs – 2009 Per Pax Cost / pax vs. stage length (1)(2) Cost / pax, ex-fuel vs. stage length (1)(2) We expect flat 2010 ex-fuel costs Source: Financial reports of the companies, with the exception of Spirit, which is DOT Form 41 (1) Special charges and other one-time items are excluded (2) Vert
Slide 9: Unique Revenue Approach
Unique Revenue Approach Non-traditional markets Aggressive capacity management Ancillary revenue Own reservation platform Closed distribution system Pricing power
Slide 10: Non-Traditional Markets
Non-Traditional Markets Small, underserved (and sometimes unserved) markets Value proposition: Nonstop Local airport (avoid multi-hour drive) Big airplane Low, low fares Third-party sales Little to no competition Stimulation of previously overlooked markets
Slide 11: Aggressive Capacity Management
Avg. daily scheduled flights by month(1) Aggressive Capacity Management 2008 2007 2009 July 2008 High Fuel Price (1) Published schedules thru June 2010 2010E March > 8 block hours Sept ~ 4.5 block hours (1)
Slide 12: Ancillary Revenue
Ancillary Revenue Air-related charges, $29/pax in 2009, a la carte pricing (bags, seats, etc) Third party products, $4/pax in 2009 3.5% of 2009 revenues, 16.4% of pre-tax income Merchant model – wholesale price from hotel or rental car, we set the retail price Corporate focus on driving significantl
Slide 13: Own Reservation System
Own Reservation System Vast majority of airlines use system owned by third party - GDS (e.g. Sabre) or new gen LCC system (such as Open Skies) Software enhancements driven by consensus Encourages commoditization – all can offer same products We can offer a differentiated product Uniquely (and quickl
Slide 14: Distribution
Distribution Can only buy Allegiant air service from one source...Allegiant! Maximizes eyeballs of highly desirable customers on one website and creates revenue opportunities from: Sale of third party products Better CRM opportunities Advertising Very focused on monetizing brand value For air, lowes
Slide 15: 2010 Agenda
2010 Agenda Hawaii and 757-200 Fleet $25mm share repurchase authority – YE09 cumulative buyback $42mm Long Beach (California) – 2 slots recently awarded Grand Rapids new “small city” base – April 2010 Orlando International – 10 routes Buying 20 MD-80s from SAS Plan to add 15 aircraft in 2010 and 201
Slide 16: Hawaii
Hawaii Largest major US leisure market untapped by Allegiant Significant ancillary revenue opportunity Large hotel & rental car opportunities from longer passenger stays Significant fee opportunities from longer stage lengths No service on planned routes Existing and forecasted fares much higher tha
Slide 17: 757 Program
757 Program Best Hawaii aircraft Can reach Rocky Mountains 200+ seats Acquisition cost enables same flexible capacity approach as MD-80 Matched set of six high-spec, excellent-condition aircraft available Limited downside – if targeted expansion market fails, we can profitably put these to work else
Slide 18: Network Evolution
Network Evolution Geographic diversity Destination Markets 2Q10 depts Y/Y change depts Las Vegas 39 35.0% 0.2% Orlando 30 23.4% -6.9% Phoenix 20 13.0% 28.9% St. Petersburg 20 13.2% -7.6% SoCal 11 5.9% 56.3% Other 18 9.5% 6.1%
Slide 19: Growth – Same Store Departures
Growth – Same Store Departures True same-store departure growth for a given month excludes: Routes flown in this year but not prior year or vice versa Routes flown for a partial month in one or more of prior or this year Room for capacity upside in 2Q10
Slide 20: Guidance
Guidance Post-February update February 2010: RASM change 4% TRASM change 2% change in total fare 7% fuel price $2.02/gal fuel cost/passenger $39 1Q10 RASM change >2% 1Q10 TRASM change >1% 1Q10 total fare change >5%
Slide 21: Summary
Summary Superior results Sustained profitability Highly adaptable High growth Strong balance sheet Experienced management team Creating shareholder value
Slide 22: Appendix
A P| pend ix
Slide 23: GAAP Reconciliation
GAAP Reconciliation 2009 Free Cash Flow $120mm = Operating Income of $122mm + Depreciation & Amortization of $30mm - Capital expenditures of $32mm 2009 EBITDAR ($154mm)/2009 Average Aircraft (42.7) = $3.6mm $mm 2009 2008 2007 2006 Net Income 76 35 32 9 +Provision for Income Taxes 44 20 19 7 +Other E
Allegiant Travel — Investor Presentation (March 2010) on 6ix