Jetblue Airways Corporation · NASDAQ:JBLU
Jetblue Airways — Q2 2022 Earnings Presentation
25 slides from Jetblue Airways's earnings presentation, Aug 2, 2022
Slide 1: 2Q22 Earnings Presentation
2Q22 EARNINGS PRESENTATION AUGUST 2, 2022
Slide 2: Safe Harbor
2 SAFE HARBOR This Presentation (or otherwise made by JetBlue or on JetBlue’s behalf) contain various forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or
Slide 3: Additional Information and Where to Find It
3 Additional Information and Where to Find It On July 28, 2022, JetBlue entered into a merger agreement with Spirit and Sundown Acquisition Corp. A meeting of the stockholders of Spirit will be announced as promptly as practicable to seek stockholder approval in connection with the proposed transact
Slide 4: 2Q 2022 Robin Hayes, Chief Executive Officer
4 2Q 2022 EARNINGS UPDATE ROBIN HAYES CHIEF EXECUTIVE OFFICER
Slide 5: Creating Long-term Value for All Stakeholders
5 Will Provide Significant Value for JetBlue and Spirit Shareholders Exhibits Strong Strategic Rationale Will Create a Compelling National Low-fare Challenger Will Accelerate Existing Growth Plan while Complementing JetBlue’s Northeast Alliance (NEA) Strategy Will Significantly Enhance JetBlue’s Lon
Slide 6: Returning to Sustained Profitability
6 RETURNING TO SUSTAINED PROFITABILITY FY 2022 OUTLOOK (1) Refer to reconciliations of non-GAAP financial measures in Appendices A & B (2) Liquidity defined as unrestricted cash, cash equivalents, short-term investments and long-term marketable securities (3) As of June 30, 2022 • GAAP loss per shar
Slide 7: Enhancing Long-term Earnings Power
7 ENHANCING LONG-TERM EARNINGS POWER Strategic initiatives to structurally improve our profitability • Strengthening relevance, boosting competition, and growing our two largest focus cities – New York and Boston – through the Northeast Alliance (NEA) • Broad product portfolio offers unique customer
Slide 8: Commercial Update & Outlook
8 COMMERCIAL UPDATE & OUTLOOK JOANNA GERAGHTY PRESIDENT & CHIEF OPERATING OFFICER
Slide 9: Delivering on Our Operational Plan
9 2.3% 2Q22 3Q22* FY22* DELIVERING ON OUR OPERATIONAL PLAN ASM GROWTH VERSUS 2019 EstimateFlown • Clear returns from summer operational investments − Significant investments to reliably deliver for customers and crewmembers − May and June completion factor of >98%, compared to 90% in first three wee
Slide 10: Generating Record Unit Revenue Growth
1 0 (6.9%) 13.5% 1Q22 2Q22 3Q22* GENERATING RECORD UNIT REVENUE GROWTH RASM GROWTH VERSUS 2019 • Capitalizing on robust leisure demand environment − Second quarter revenue came in above the high-end of initial guidance due to robust demand across network − Ancillary revenue per customer grew ~65% in
Slide 11: Financial Update & Outlook
1 1 FINANCIAL UPDATE & OUTLOOK URSULA HURLEY CHIEF FINANCIAL OFFICER
Slide 12: Summary Financials 2Q 2022
1 2 SUMMARY FINANCIALS 2Q 2022 US$ Millions 2Q 2022 2Q 2019 Change vs ‘19 Revenue 2,445 2,105 16% Operating Expenses 2,558 1,855 38% Adjusted Operating Expenses (1) 2,514 1,853 36% Adjusted Pre-Tax Income (Loss) (1) (102) 238 NM Earnings / (Loss) per Diluted Share (0.58) 0.59 NM Adjusted Earnings /
Slide 13: Keeping a Diligent Focus on Costs
1 3 2.3% 14.5% 34.7% ASM CASM ex-Fuel CASM CASM EX-FUEL VERSUS 2019 COST INITIATIVES Actual 2Q22 Estimate 3Q22* • Investing to operate reliably; expect productivity improvements into 2023 − 2Q22 CASM ex-Fuel better versus guidance, with slight benefit from better-than-expected completion factor − 3Q
Slide 14: Setting a New Foundation for Long-term Costs
1 4 SETTING A NEW FOUNDATION FOR LONG-TERM COSTS Network Efficiency Crew Planning End-of-Life Maintenance Optimization Maximizing Asset Productivity Accelerated E190 Transition to A220s Total cost reduction opportunity of ~$250M through 2024, supporting a flattish multi-year CASM ex-Fuel trajectory
Slide 15: Maintaining Relative Balance Sheet Strength
1 5 MAINTAINING RELATIVE BALANCE SHEET STRENGTH LEVERAGE Source: Management projections, historical financials, consensus estimates. Note: 2022E industry median excludes JetBlue and is based on consensus estimates as of July 19, 2022. Post-transaction net leverage is based on management projections
Slide 16: Summary of 3Q 2022 Guidance
1 6 SUMMARY OF 3Q 2022 GUIDANCE METRIC Guidance Available Seat Miles (ASMs) (3%) – 0% Yo3 RASM 19% – 23% Yo3 CASM ex-Fuel 15% – 17% Yo3 Operating Expenses Related to Other Non-Airline Businesses ~$14 million Estimated Fuel Price per Gallon $3.68 Tax Rate ~37% Capital Expenditures ~$350 million Note:
Slide 17: Questions?
1 7 QUESTIONS?
Slide 18: 2Q 2022 Financial Results
1 8 2Q 2022 FINANCIAL RESULTS US$ Millions 2Q 2022 2Q 2019 Change vs ’19 Total operating revenues 2,445 2,105 16% Aircraft fuel and related taxes 910 484 88% Salaries, wages and benefits 695 576 21% Landing fees and other rents 149 121 23% Depreciation and amortization 145 127 14% Aircraft rent 27 2
Slide 19: Non-GAAP Financial Measures
1 9 Non-GAAP Financial Measures JetBlue uses non-GAAP financial measures in this presentation. Non-GAAP financial measures are financial measures that are derived from the consolidated financial statements, but that are not presented in accordance with generally accepted accounting principles in the
Slide 20: CASM Ex-Fuel Reconciliation
2 0 Operating expense per available seat mile, excluding fuel and related taxes, other non-airline operating expenses, and special items (“CASM Ex-Fuel”) Operating expenses per available seat mile, or CASM, is a common metric used in the airline industry. We exclude aircraft fuel and related taxes,
Slide 21: Operating Expense, Income and EPS Excluding Special Items
2 1 Operating expense, (loss) income before taxes, net (loss) income, and (loss) earnings per share, excluding special items and net gain (loss) on investments Our GAAP results in the applicable periods were impacted by charges that are deemed special items. For the three and six months ended June 3
Slide 22: Appendix B: Calculation of Leverage Ratios
2 2 APPENDIX B: CALCULATION OF LEVERAGE RATIOS LOCATION Adjusted debt to capitalization ratio Adjusted debt to capitalization ratio is a non-GAAP financial metric which we believe is helpful to investors in assessing the company's overall debt profile. Adjusted debt includes aircraft operating lease
Slide 23: Appendix B: Adjusted Net Debt to EBITDAR
2 3 APPENDIX B: CALCULATION OF LEVERAGE RATIOS LOCATION Adjusted net debt to EBITDAR ratio Adjusted debt includes aircraft operating lease liabilities, in addition to total debt and finance leases, to present estimated financial obligations. Trailing 12 months EBITDAR consists of Earnings Before Int
Slide 24: Appendix C: Contractual Order Book
2 4 Deliveries A220 A321NEO A321NEO LR A320 E190 Total 2022 10 - 3 - - 13 2023 21 6 5 - - 32 Note: Delivery and return schedules as of August 2, 2022. The above represents the current delivery schedule set forth in our Airbus order book. However, we note that due to delays to the Airbus A220 program
Slide 25: Investor Relations Resources
2 5 Spirit Acquisition https://lowfaresgreatservice.com Investor Presentations http://blueir.investproductions.com/investor-relations/events-and-presentations/presentations Earnings Releases http://blueir.investproductions.com/investor-relations/financial-information/quarterly-results Annual Reports