‘Today demand remains over 90% below normal levels,’ Alaska Air Group reports first quarter results
Alaska Air Group, the parent company of Alaska Airlines Inc. and Horizona Air Industricts Inc., released its first quarter report for 2020.
One main takeaway from the report, the company is seeing a net loss due to COVID-19.
According to a press release, “Reported net loss for the first quarter of 2020 under Generally Accepted Accounting Principles of $232 million, or $1.87 per diluted share, compared to net income of $4 million, or $0.03 per diluted share in the first quarter of 2019.”
Here are some other important takeaways from the report go as follows:
- Alaska Air Group says demand for flights started to decrease in February and continued through March when cancellations overwhelmed new bookings
- Demand remains over 90% below normal levels
- Flown capacity in April decreased more than 80% compared to the prior year, and capacity cuts in May will also be at least 80%
- Alaska Air Group parked 156 mainline aircraft and 13 Horizon Air aircraft and suspended flying for 8 SkyWest Airlines aircraft
- Enacted a company-wide hiring freeze for all non-essential positions, reduced salaries of senior management and offered voluntary short-term and incentive leave programs accepted by more than 5,000 employees
- Suspended stock repurchases and future dividend payments
Specifically in Alaska, an Alaska Airlines spokesperson says "like the rest of the network, we’ve seen an 80% reduction in scheduled service to/from and around the state of Alaska. We’ll continue with this current reduction and will be looking to increase service to meet demand in the coming weeks."
The spokesperson went on to say bookings did slow down around the same time as the overall network, but things have started to steady.
"We have no further plans for reduction now and Working to expand service to Cold Bay, Dillingham and King Salmon in the next few weeks to cover the loss of air service to these communities," said the spokesperson.
Aside from the net losses being reported, federal funds are coming to the company to keep things afloat. On April 23, 2020, the company received $992 million in funding support under the CARES Act PSP. On top of that, it applied to participate in the Loan Program of the CARES Act, which would give Air Group the option to access up to $1.1 billion in federal loans through Sept. 30, 2020.
The report also went on to mention what the company is doing to ensure the safety, health, and financial well-being of passengers and employees.
Starting May 11,
. On Monday it was announced employees who cannot maintain six feet of social distance from guests or coworkers must also wear face maks.
Alaska Air Group adds cleaning procedures have also been stepped up. Crews are using high-grade, EPA-registered disinfectants and electrostatic sanitizing spray to clean planes. There has been a reduction of in-flight services, as wells as having all planes equipped with hospital-grade HEPA filters.
Other highlights include:
- Any elite-qualifying miles earned between January 1, 2020 and April 30, 2020 will be rolled over to 2021
- Provided passengers with a "Peace of Mind" waiver, allowing changes to ticketed travel without change or cancellation fees
- Utilized its dedicated fleet of cargo freighter to transport essential supplies from Seattle and throughout Alaska
The full first quarter 2020 results can be found