Jetblue Airways Corporation · NASDAQ:JBLU
Jetblue Airways — Q4 2019 Earnings Presentation
24 slides from Jetblue Airways's earnings presentation, Jan 23, 2020
Slide 1: 4Q 2019 Earnings Presentation
4Q 2019 EARNINGS PRESENTATION JANUARY 23, 2020 1
Slide 2: Safe Harbor
SAFE HARBOR 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 Securities Exchange Act of 1934, as
Slide 3: 4Q 2019 Earnings Update: Robin Hayes, CEO
4Q 2019 EARNINGS UPDATE ROBIN HAYES CHIEF EXECUTIVE OFFICER
Slide 4: Committed to Achieving $2.50 - $3.00 EPS in 2020
COMMITTED TO ACHIEVING $2.50 - $3.00 EPS IN 2020 PRE-TAX MARGINS JBLU VS PEERS* HIGHLIGHTS / KEY DEVELOPMENTS 4Q 2018 4Q 2019 • Full year 2020 capacity growth expected between 5.5 and 7.5% driven GAAP Non-GAAP** Non-GAAP by disciplined network expansion, and additional seats from cabin restyling pro
Slide 5: Commercial Update & Outlook
COMMERCIAL UPDATE & OUTLOOK JOANNA GERAGHTY PRESIDENT & CHIEF OPERATING OFFICER
Slide 6: Capacity Growth: Focusing on Our Strengths
CAPACITY GROWTH: FOCUSING ON OUR STRENGTHS ASM YOY GROWTH • 2020 growth driven by timing of aircraft deliveries Low scheduled capacity growth 5.5 – 7.5% and restyling efforts driven by NEO 6.6% delays − Unusually low capacity growth in 1Q driven by 2019 6.0% NEO delays − Recently signed agreement fo
Slide 7: Unit Revenue: Benefits Ramping from Initiatives
UNIT REVENUE: BENEFITS RAMPING FROM INITITIAVES RASM YOY GROWTH • 4Q 2019 performance reflects softer close-in trends during Thanksgiving − International market trends improved sequentially from 0.0 – 3.0% high single digit declines in 3Q19 − Continued strong trends in transcon and business markets
Slide 8: Financial Update & Outlook
FINANCIAL UPDATE & OUTLOOK STEVE PRIEST CHIEF FINANCIAL OFFICER
Slide 9: Building Block Initiatives Driving Margin Gains
BUILDING BLOCK INITIATIVES DRIVING MARGIN GAINS RASM CASM & CASM EX-FUEL* PRE-TAX MARGIN* EARNINGS PER SHARE* (US$ cents) (US$ cents) (US$ cents) 4Q 2019 4Q 2019 4Q 2019 4Q 2019 10.9% 12.98 0.56 0.56 12.63 10.8% 0.55 11.55 11.22 0.50 8.31 8.31 10.4% 10.2% CASM CASM (GAAP) (GAAP) (Non- (Non- CASM CAS
Slide 10: Unit Costs: On Pace to Hit 2020 Cost Goals
UNIT COSTS: ON PACE TO HIT 2020 COST GOALS CASM EX-FUEL YOY GROWTH* • Achieved CASM ex-fuel goals in both 4Q and full year 2019 1.5 – 3.5% ‒ Progress on Structural Cost Program and operational improvements fully mitigated NEO delays in 4Q 2019 ‒ Exited 2019 with negative underlying CASM ex-fuel run-
Slide 11: Unit Costs: Execution of CASM Ex-Fuel Goals
UNIT COSTS: EXECUTION OF CASM EX-FUEL GOALS CASM EX-FUEL YOY GROWTH 2019* CASM EX-FUEL / ASM YOY GROWTH 2020 Guidance as of 1/24/19 Actuals as of 12/31/19 CASM ex-Fuel Guidance as of 1/23/20 Capacity Guidance as of 1/23/20 Flatter progression Structural Cost during 2019, driven Program, timing 8.0 –
Slide 12: Structural Cost Program Completed; Continuing Efforts Into Next Decade
STRUCTURAL COST PROGRAM COMPLETED; CONTINUING EFFORTS INTO NEXT DECADE SAVINGS CATEGORY ACHIEVEMENT* OPPORTUNITY • Achieved 2020 savings of $314 million, exceeding Tech Ops guidance established in 2016 Investor Day ‒ Structural Cost savings evidenced in CASM ex-Fuel Corporate progression from 2018 t
Slide 13: Accretive Fleet Growth and Reinvestment Continues
ACCRETIVE FLEET GROWTH AND REINVESTMENT CONTINUES FLEET* CAPITAL EXPENDITURES Guidance as of 1/23/20 271 259 253 1 $1.35 - $1.55b 6 17 35 35 35 $1.1b $1.1b 28 28 28 130 130 130 60 60 60 2018 2019 2020E 2018 2019 2020E E190 A320 A321 HD A321 Mint A321neo HD A220 • Six A321neos delivered during 2019 •
Slide 14: Balanced Approach to Capital Allocation
BALANCED APPROACH TO CAPITAL ALLOCATION SOURCES / USES OF CASH LEVERAGE RATIOS* (US$ billion) 12/31/2018 12/31/2019 Trailing 12 months as of 12/31/2019 SOURCES USES 1.81x Net share 0.5 repurchases Debt 1.57x 1.0 raise 0.3 Debt repayments CAPEX and 1.2 other Cash from operations and 1.4 other Beginni
Slide 15: 1Q 2020 Guide Summary
1Q 2020 GUIDE SUMMARY EPS CAPACITY RASM CASM EX-FUEL* 1Q 2020 FY 2020 1Q 2020 FY 2020 1Q 2020 FY 2020 1Q 2020 FY 2020 $0.10 – 0.20 $2.50 – 3.00 1.5 – 3.5% 5.5 – 7.5% 0.0 – 3.0% N/A 1.5 – 3.5% (2.0) – 0.0% ALL-IN FUEL PRICE FUEL GALLONS OTHER INCOME / (EXPENSE) JTP / JTV (EXPENSES) 1Q 2020 FY 2020 1Q
Slide 16: Questions?
QUESTIONS?
Slide 17: Appendix A: Non-GAAP Financial Measures
APPENDIX A Non-GAAP Financial Measures JetBlue sometimes uses non-GAAP financial measures in this presentation. Non-GAAP financial measures are financial measures that are derived from the consolidated financial statements, but that are not presented in accordance with generally accepted accounting
Slide 18: 4Q 2019 Financial Results
4Q 2019 FINANCIAL RESULTS US$ Millions 4Q 2019 4Q 2018 Var % Total Operating Revenues 2,031 1,968 3.2 Aircraft fuel and related taxes 455 476 (4.6) Salaries, wages and benefits 589 543 8.4 Landing fees and other rents 112 108 4.8 Depreciation and amortization 140 123 13.7 Aircraft rent 23 28 (18.5)
Slide 19: CASM Ex-Fuel Reconciliation
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, oper
Slide 20: Operating Expense, Income, Net Income and EPS Excluding Special Items
Operating Expense, Income before Taxes, Net Income and Earnings per Share, excluding special items, gain on equity method investments, and impact of tax reform Our GAAP results in the applicable periods were impacted by the following: (a) the 2017 tax reform, (b) a gain on equity method investments,
Slide 21: Appendix B: Calculation of Leverage Ratios
APPENDIX B: CALCULATION OF LEVERAGE RATIOS 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 liabilities,
Slide 22: Adjusted Debt to EBITDAR Ratio
Adjusted Debt to Earnings Before Interest, Taxes, Depreciation, Amortization and Rent ("EBITDAR") Ratio Adjusted debt to earnings before interest, taxes, depreciation, amortization and rent ratio, or EBITDAR, is a non-GAAP financial metric which we believe is helpful to investors in assessing the co
Slide 23: Appendix C: Contractual Order Book
APPENDIX C: CONTRACTUAL ORDER BOOK CONTRACTUAL ORDER BOOK CURRENT A321NEO STATUS Delayed Beyond A220 A321NEO Total Delivered Contractual Delivery Year 2019 - 13 13 6 7 2020* 1 14 15 3 2021 6 17 23 2022 8 15 23 2023 19 14 33 2024 22 12 34 2025 12 - 12 2026 2 - 2 Total 70 85 155 6 10 Delivery schedule
Slide 24: Appendix D: Relevant JetBlue Materials
APPENDIX D: RELEVANT JETBLUE MATERIALS www.investor.jetblue.com/investor-relations DOCUMENT LOCATION Investor Presentations http://blueir.investproductions.com/investor-relations/events-and-presentations/presentations Earnings Releases http://blueir.investproductions.com/investor-relations/financial