Jetblue Airways Corporation · NASDAQ:JBLU
Jetblue Airways — Q3 2021 Earnings Presentation
28 slides from Jetblue Airways's earnings presentation, Oct 26, 2021
Slide 1: 3Q21 Earnings Presentation
3Q21 EARNINGS PRESENTATION OCTOBER 26, 2021
Slide 2: Safe Harbor
2 SAFE HARBOR Forward-Looking Information Statements in 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 Securi
Slide 3: 3Q 2021 Earnings Update
3 3Q 2021 EARNINGS UPDATE ROBIN HAYES CHIEF EXECUTIVE OFFICER
Slide 4: Building Towards Earnings Recovery
4 BUILDING TOWARDS EARNINGS RECOVERY KEY LIQUIDITY UPDATE (1) Refer to reconciliations of non-GAAP financial measures in Appendices A & B (2) As of September 30, 2021 • GAAP earnings per diluted share of $0.40; non-GAAP loss per share of ($0.12) (1) • Adjusted EBITDA of $140M (1) versus expected ran
Slide 5: Accelerating ESG Efforts and Doubling Down on Commitments
5 • Doubling down on crewmember education programs by adding more development opportunities and increasing accessibility to certain roles • Supporting STEM and aviation programs focused on underrepresented communities • Growing spend with underrepresented Business Partners • Now well ahead of pace t
Slide 6: Restoring Margins and Balance Sheet Strength
6 RESTORING MARGINS AND BALANCE SHEET STRENGTH Executing margin accretive revenue and network initiatives Remaining focused on cost control to drive superior margins Implementing Northeast Alliance to deliver customer benefits Maintaining fixed cost savings as enterprise scales Enhancing value propo
Slide 7: The NEA Supercharges Competition
7 THE NEA SUPERCHARGES COMPETITION Generating benefits for all of our stakeholders Delivering Broader BenefitsSpurring CompetitionBenefitting Consumers The NEA challenges the dominance of entrenched carriers in New York and Boston by creating a third, full-scale competitor • Competitors have announc
Slide 8: Commercial Update & Outlook
8 COMMERCIAL UPDATE & OUTLOOK JOANNA GERAGHTY PRESIDENT & CHIEF OPERATING OFFICER
Slide 9: Revenue Trends Normalizing
9 (3.3%) (2.9%) (12.3%) (28.8%) (5.5%) Jul '21 Aug '21Sep '21 2Q21 3Q21 4Q21* REVENUE TRENDS NORMALIZING REVENUE YO2Y GROWTH • Strong revenue performance during summer − Delta-variant predominantly impacted September with its thinner leisure demand and higher mix of business traffic − Bookings began
Slide 10: Capacity Deployment Aligned with Demand Trends
1 0 (1.9%) (0.4%) 0.0% (14.9%) (0.8%) Jul '21 Aug '21Sep '21 2Q21 3Q21 4Q21* CAPACITY DEPLOYMENT ALIGNED WITH DEMAND TRENDS ASM YO2Y GROWTH PlannedFlown • 4Q21 capacity aligned with demand trends − Seeing progressive normalization of booking patterns − Sequential capacity deployment reflects seasona
Slide 11: Financial Update & Outlook
1 1 FINANCIAL UPDATE & OUTLOOK URSULA HURLEY CHIEF FINANCIAL OFFICER
Slide 12: Summary Financials 3Q 2021
1 2 SUMMARY FINANCIALS 3Q 2021 METRIC 3Q 2021 3Q 2019 Change vs ‘19 Revenue (US$ million) 1,972 2,086 (5%) Operating Expenses (GAAP) 1,786 1,839 (3%) Operating Expenses (Non-GAAP) (1) 1,972 1,839 7% EBITDA (Adjusted) (US$ million) (1) 140 381 (63%) Earnings per Diluted Share (GAAP) 0.40 0.63 (36%) E
Slide 13: Offsetting Near-Term Unit Cost Pressure
1 3 (0.8%) 12.7% (2.1%) ASM CASM ex-Fuel CASM YO2Y CASM EX-FUEL COST INITIATIVES Actual 3Q21 Planned 4Q21* • Diligently managing cost pressures tied to the recovery − 3Q21 performance in-line with prior expectations despite operational challenges and incremental labor costs tied to financial incenti
Slide 14: Expecting Significant Unit Cost Reduction in 2H22
1 4 EXPECTING SIGNIFICANT UNIT COST REDUCTION IN 2H22 2H21 1H22 2H22 FY22 Key Assumptions: • Expecting strong continued recovery in travel demand throughout 2022 driving relief in rents and landing fees rate headwind of ~3 – 4 pts in 2H21 • Gaining efficiencies as ramp-up labor related costs of ~2 p
Slide 15: Investing in Margin Accretive Aircraft Fleet
1 5 $263 ~$200 ~$1,000 3Q21 4Q21* 2021* • 2021 CAPEX expected to be ~$1B • Prioritizing highest ROI non-aircraft CAPEX projects CAPEX INVESTING IN MARGIN ACCRETIVE AIRCRAFT FLEET* PlannedActual (US$ million) • Taking next generation aircraft to improve margins • In 3Q21, took delivery of 3 A220s and
Slide 16: Balanced Approach to Multi-Year Deleveraging Effort
1 6 BALANCED APPROACH TO MULTI-YEAR DELEVERAGING EFFORT LEVERAGE (1) Refer to reconciliations of non-GAAP financial measures in Appendix B Adjusted Debt to Cap (1) • Actively lowering debt towers by paying off scheduled debt payments and additional prepayments • Well-positioned to achieve investment
Slide 17: Summary of Current Planning Assumptions for 4Q 2021
1 7 SUMMARY OF CURRENT PLANNING ASSUMPTIONS FOR 4Q 2021* METRIC Planning Assumption EBITDA (Non-GAAP) ($50) – $50 million Revenue (8%) – (13%) Yo2 Available Seat Miles (ASMs) (4%) – (7%) Yo2 CASM ex-Fuel 14% – 16% Yo2 Operating Expenses Related to Other Non-Airline Businesses ~$13 million Estimated
Slide 18: Questions?
1 8 QUESTIONS?
Slide 19: 3Q 2021 Financial Results
1 9 3Q 2021 FINANCIAL RESULTS US$ Millions 3Q 2021 3Q 2019 Yo2Y % Total operating revenues 1,972 2,086 (5.5) Aircraft fuel and related taxes 443 471 (5.9) Salaries, wages and benefits 620 580 6.8 Landing fees and other rents 182 125 45.2 Depreciation and amortization 140 134 4.1 Aircraft rent 25 26
Slide 20: Committing to Sustainable Growth in New York
2 0 COMMITTING TO SUSTAINABLE GROWTH IN NEW YORK • Now well ahead of target to convert 10% of total fuel usage to sustainable aviation fuel (SAF) on a blended basis by 2030 • SG Preston agreement marks first large-scale volume of domestically produced SAF for a commercial airline to New York’s metro
Slide 21: Non-GAAP Financial Measures
2 1 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 22: CASM Ex-Fuel Reconciliation
2 2 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 23: Adjusted EBITDA Reconciliation
2 3 LOCATION Earnings before interest, taxes, depreciation, amortization, and special Items Earnings before interest, taxes, depreciation, and amortization (EBITDA) is a non-GAAP financial measure. We believes this measure allows investors to better understand the financial performance of the compan
Slide 24: Excluding Special Items Reconciliation
2 4 Operating expense, income (loss) before taxes, net income (loss) and earnings (loss) per share, excluding special items and gain on equity investments Our GAAP results in the applicable periods were impacted by credits and charges that were deemed special items. In 2021, special items include co
Slide 25: Appendix B: Calculation of Leverage Ratios
2 5 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 26: Adjusted Net Debt
2 6 LOCATION Adjusted Net Debt Adjusted net debt is a non-GAAP financial measure which we believe is helpful to investors in assessing our overall debt profile. We reduce our adjusted debt by cash, cash equivalents, and short-term investments resulting in adjusted net debt, to present the amount of
Slide 27: Appendix C: Contractual Order Book
2 7 A220 A321NEO A321NEO LR Total 2021* 7 5 3 15 2022 9 - 3 12 Delivery schedule, as of October 26, 2021 *Includes 13 deliveries received through 3Q21 APPENDIX C: CONTRACTUAL ORDER BOOK
Slide 28: Investor Relations Links
2 8 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 http://blueir.investproductions.com/investor-relati