Hawaiian Airlines cargo revenue falls 19% in Q3

Hawaiian Holdings , the parent company of Hawaiian Airlines , on Tuesday reported third-quarter operating revenue of $728 million, a 2% decline from Q3 2022. Cargo and other revenue decreased 19.5% year-over-year to $62.8 million. THE BIG PICTURE: The year was marked by $48.7 million in net losses, due in large part to wildfires in Maui and increased operating costs, including jet fuel prices . “We ended the third quarter with an adjusted [earnings before income] loss of about $12 million, or an adjusted loss of $1.06 per share, which is about $40 million lower than we had forecast at the beginning of the quarter” Shannon Okinaka , chief financial officer at Hawaiian Airlines , said during Tuesday's earnings call. With the regional wildfire outbreak in August, Hawaiian Airlines flew 54,000 tonnes of cargo to aid victims in Maui, but lost $25 million in profit, or about 22% of its system revenue, due to cancellations, the company reported during its earning call. WHAT THEY’RE SAYING: Hawaiian Airlines executives said the carrier continues to outperform competitor Southwest Airlines by wide margins in terms of load factor and unit revenue when it comes to serving the Neighbor Islands. “ Up until the wildfires on Maui, our revenue was tracking ahead of the expectations we had entering the quarter, with particular strength from the U.S. mainland to Hawaii. Sydney and Incheon continue to produce strong results,” Peter Ingram , chief executive at Hawaiian Airlines, said during the call. “International performance was not materially affected by the Maui wildfires” STATE OF PLAY: Hawaiian Airlines began to expand its freighter fleet in partnership with Amazon through a deal announced in October 2022 . “E ven as we face more than our fair share of challenges, our team remains focused on important initiatives that make us a better airline, including the debut of Amazon freighter flights early this month, the unveiling of our 787 interiors and the successful first of type installation of Starlink Wi-Fi on an A321 aircraft,” Ingram said. FUTURE LOOK: Service with Amazon by Hawaiian Airlines began Oct. 2 and the airline received the first of 10 converted A330 freighters in July, the company reported. “On Oct. 2, we flew our first A330-300 freighter revenue flight from Cincinnati to San Bernardino,” Ingram said. “As a reminder, this is the beginning of a contractual relationship that envisions initial growth to a10-aircraft fleet in the months ahead.” Hawaiian Airlines also expects to receive 12 Boeing 787 aircraft by 2027 and the remaining nine A330 freighters will be delivered in the next two years, the company reported. THE BOTTOM LINE: “ I obviously wish that the third quarter’s financial outcomes more appropriately reflected the outstanding work of our team,” Ingram said. “While we are financially secure to continue investing for the long-term, we know that we need to deliver better near-term performance in spite of the external challenges we face. The initiatives that are coming on now and early next year will help us achieve this.” MARKET OUTLOOK: Shares of Hawaiian Holdings [ NASDAQ : HA] were down 3.95% from market open to $4.13 per share at market close today. Hawaiian Holdings has a market capitalization of $212.5 million.

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