Allegiant Travel Company · NASDAQ:ALGT
Allegiant Travel — Investor Presentation (February 2019)
18 slides from Allegiant Travel's investor presentation, Feb 12, 2019
Slide 1: Management Presentation February 2019
Management Presentation February 2019
Slide 2: Forward looking statements
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 uncertai
Slide 3: Advantages over the typical carrier
Advantages over the typical carrier Leisure customer Built to be different – Will travel in all economic conditions – Vacations are valued – price dependent Leisure customer Small/medium cities Underserved markets – Filling a large void Little competition – Increasing opportunity - industry rest
Slide 4: Measured, profitable growth
Measured, profitable growth Total revenue Scheduled ASMs 15.00 14.34 14.00 $1,700 $1,667 13.03 $1,600 13.00 $1,504 11.92 $1,500 12.00 11.00 $1,400 $1,363 ASMs - billions USD -USD mm 10.24 10.00 $1,300 $1,262 $1,200 9.00 8.69 $1,137 $1,100 8.00 $1,000 7.00 2014 2015 2016 2017 2018 2014 2015 2016 2017
Slide 5: A very large niche
A very large niche Based on current published schedule through August 13, 2019 431 routes, 96 small/medium cities, 26 leisure destinations Orange circles = destinations 5
Slide 6: Little competition
Little competition Historic level of non-competitive routes 322 314 309 294 255 221 207 181 161 168 136 114 109 98 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2019 Routes without competition Routes with competition Competitors – overlapping routes Legacy carriers 70 Brand/lower
Slide 7: Low frequency model
Low frequency model Leisure = seasonality Small cities = low frequency(1) Avg. block hours/AC/day Weekly market frequency 70.0% 9.5 Peak Off peak 60.0% 8.5 50.0% 7.5 40.0% 30.0% 6.5 % departures total of % 20.0% System block hours/AC/day System 5.5 10.0% 0.0% 4.5 2x 3x 4x 5x or greater Jan Feb Mar A
Slide 8: Low costs even with low utilization
Low costs even with low utilization 2018 CASM ex fuel vs daily aircraft utilization 9.0 8.5 8.4 JBLU 8.0 7.7 7.5 ALK 7.0 6.5 CASM ex fuel (cents) 6.4 ALGT 6.0 5.5 5.3 SAVE 5.0 5.0 6.0 7.0 8.0 9.0 10.0 11.0 12.0 13.0 14.0 Average daily aircraft utilization – LTM (block hours per day) As of 2018, ALGT
Slide 9: Fleet plan
Fleet plan 120 Aircraft by seat count Total Total 102 100 Total 93 89 Total 26 80 76 20 32 10 24 60 38 AC count EOY 22 23 40 20 20 38 38 37 32 0 2017 2018 2019E 2020E MD80 (166 seats) A319 (156 seats) A320 (186 seats) A320 (177 seats) Estimated aircraft count at end of year 186 seat density project
Slide 10: Capex & Airbus heavy maintenance
Capex & Airbus heavy maintenance Airline capital expenditures ($ millions) $700 Total $630 $600 35 Total 75 $535 $500 105 Total $400 $350 75 15 Total 50 $300 $280 520 49 Millions USD Millions 20 90 $200 340 75 $100 231 15 100 $0 2017 2018 2019E 2020E Aircraft CAPEX 186 seat conversion Other CAPEX Ai
Slide 11: Cumulative return to shareholders
Cumulative return to shareholders $927m returned to shareholders since 2007 $100m remaining in share repurchase authority Reduced diluted share count by 22% since 2007** $900 Implemented quarterly cash dividend in Q1 2015 – now $0.70 per share $800 $700 $316.2 $271.0 $600 $225.3 $157.8 $500 $ mm $40
Slide 12: Unique business model and results
Unique business model and results Highly resilient and profitable – Profitable last 64 quarters (1) – 2018 adjusted EBITDA $373mm (2) – 2018 Return on Equity 26%(2) Strong balance sheet – Rated BB- and Ba3(3) – Adjusted debt/ EBITDAR 3.4x(2) – $45mm returned to shareholders in 2018 • $100 mm in
Slide 13: Existing guidance - 2019
Existing guidance - 2019 2019 FY EPS $13.25 to $14.75 per share FY 19 ASMs per gallon 80.0 to 82.0 FY 19 interest expense $70mm to $80mm FY 19 effective tax rate 24% to 25% FY 19 share count 15.9m FY 19 airline CAPEX $425mm to $435mm* FY 19 capitalized Airbus deferred heavy maintenance
Slide 14: Appendix
Appendix — allegiant_,
Slide 15: GAAP reconciliation: EBITDA calculations
GAAP reconciliation EBITDA calculations $mm 2018 2017 2016 2015 Operating income as reported (GAAP) 243.5 227.2 370.6 371.7 +Depreciation and Amortization 129.4 121.7 105.2 98.1 =EBITDA 372.9 348.9 475.8 469.8 + Write down of MD-80 fleet 35.3 =Adjusted EBITDA 372.9 384.2 475.8 469.8 + Aircraft lease
Slide 16: GAAP reconciliation: Return on equity
GAAP reconciliation Return on equity $mm 2018 2017 2016 2015 Net Income as reported (GAAP) 159.7 195.2 219.6 220.4 Dec 2018 Dec 2017 Dec 2016 Dec 2015 Dec 2014 Total shareholders equity 690.3 553.3 473.6 350.0 294.1 Return on equity 26% 38% 53% 68% ROE = Net income / Avg shareholders equity 16
Slide 17: Revenue components
Revenue components Average fare - total Average fare - ancillary third party products $140 $137.23 $5.00 $4.56 $129.35 $4.34 $130 $4.29 $4.27 $4.08 $120 $117.96 $117.38 $116.99 $110 $3.00 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 * Average fare - scheduled service Average fare - ancillary ai
Slide 18: Contribution of initiatives
Contribution of initiatives Original Actual Original Update Operating earnings annual impact -$m 1 2017 2017 2020E 2020E Fuel benefit from ASM production $6 $6 $21 $21 Ex-fuel savings (costs) (21) (29) 73 73 Credit card program 10 17 45 50 eCommerce initiatives 14 10 92 92 Pricing engine 7 2 49 49 F
Allegiant Travel — Investor Presentation (February 2019) on 6ix