Cover
Cover | 9 Months Ended |
Sep. 30, 2022 shares | |
Cover [Abstract] | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Period End Date | Sep. 30, 2022 |
Document Transition Report | false |
Entity File Number | 001-40217 |
Entity Registrant Name | Sun Country Airlines Holdings, Inc. |
Entity Incorporation, State or Country Code | DE |
Entity Tax Identification Number | 82-4092570 |
Entity Address, Address Line One | 2005 Cargo Road |
Entity Address, City or Town | Minneapolis |
Entity Address, State or Province | MN |
Entity Address, Postal Zip Code | 55450 |
City Area Code | 651 |
Local Phone Number | 681-3900 |
Title of 12(b) Security | Common Stock, par value $0.01 per share |
Trading Symbol | SNCY |
Security Exchange Name | NASDAQ |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 58,166,674 |
Entity Central Index Key | 0001743907 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2022 |
Document Fiscal Period Focus | Q3 |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Current Assets: | ||
Cash and Cash Equivalents | $ 131,912 | $ 309,338 |
Restricted Cash | 14,163 | 8,447 |
Investments | 135,170 | 6,283 |
Accounts Receivable, net of an allowance for credit losses of $175 and $250, respectively | 31,628 | 30,156 |
Short-term Lessor Maintenance Deposits | 1,211 | 5,505 |
Inventory, net of a reserve for obsolescence of $1,255 and $1,275, respectively | 7,280 | 5,405 |
Prepaid Expenses | 11,692 | 8,511 |
Other Current Assets | 4,684 | 1,798 |
Total Current Assets | 337,740 | 375,443 |
Property & Equipment, net: | ||
Finance Lease Assets | 262,060 | 209,457 |
Total Property & Equipment | 948,638 | 695,587 |
Accumulated Depreciation & Amortization | (159,779) | (117,069) |
Total Property & Equipment, net | 788,859 | 578,518 |
Other Assets: | ||
Goodwill | 222,223 | 222,223 |
Other Intangible Assets, net | 86,110 | 89,110 |
Operating Lease Right-of-use Assets | 23,919 | 61,658 |
Aircraft Deposits | 9,128 | 10,021 |
Long-term Lessor Maintenance Deposits | 29,714 | 20,346 |
Deferred Tax Asset | 14,734 | 17,608 |
Other Assets | 9,017 | 5,495 |
Total Other Assets | 394,845 | 426,461 |
Total Assets | 1,521,444 | 1,380,422 |
Current Liabilities: | ||
Accounts Payable | 49,969 | 39,805 |
Accrued Salaries, Wages, and Benefits | 25,900 | 28,527 |
Accrued Transportation Taxes | 11,000 | 12,736 |
Air Traffic Liabilities | 132,830 | 118,562 |
Over-market Liabilities | 1,535 | 4,309 |
Finance Lease Obligations | 17,484 | 11,705 |
Loyalty Program Liabilities | 13,045 | 11,451 |
Operating Lease Obligations | 6,281 | 17,231 |
Current Maturities of Long-term Debt | 45,535 | 29,412 |
Income Tax Receivable Agreement Liability | 2,260 | 0 |
Other Current Liabilities | 14,850 | 7,913 |
Total Current Liabilities | 320,689 | 281,651 |
Long-term Liabilities: | ||
Over-market Liabilities | 1,423 | 10,428 |
Finance Lease Obligations | 237,644 | 180,450 |
Loyalty Program Liabilities | 3,272 | 8,267 |
Operating Lease Obligations | 21,508 | 58,810 |
Long-term Debt | 324,662 | 248,014 |
Income Tax Receivable Agreement Liability | 101,540 | 98,800 |
Other Long-term Liabilities | 2,701 | 3,413 |
Total Long-term Liabilities | 692,750 | 608,182 |
Total Liabilities | 1,013,439 | 889,833 |
Commitments and Contingencies (see Note 13) | ||
Common Stock, Number of Shares, Par Value and Other Disclosure [Abstract] | ||
Common stock, with $0.01 par value, 995,000,000 shares authorized, 58,168,497 and 57,872,452 issued at September 30, 2022 and December 31, 2021, respectively | 582 | 579 |
Preferred Stock, Number of Shares, Par Value and Other Disclosure [Abstract] | ||
Preferred stock, with $0.01 par value, 5,000,000 shares authorized, no shares issued and outstanding at September 30, 2022 and December 31, 2021 | 0 | 0 |
Treasury stock, at cost, 1,823 shares held at September 30, 2022 and no shares held at December 31, 2021 | (52) | 0 |
Additional Paid-In Capital | 493,493 | 485,638 |
Retained Earnings | 14,764 | 4,372 |
Accumulated Other Comprehensive Loss | (782) | 0 |
Total Stockholders' Equity | 508,005 | 490,589 |
Total Liabilities and Stockholders' Equity | 1,521,444 | 1,380,422 |
Aircraft and Flight Equipment | ||
Property & Equipment, net: | ||
Aircraft and Flight Equipment | 628,375 | 447,319 |
Ground Equipment and Leasehold Improvements | ||
Property & Equipment, net: | ||
Aircraft and Flight Equipment | 33,809 | 20,876 |
Computer Hardware and Software | ||
Property & Equipment, net: | ||
Aircraft and Flight Equipment | 10,402 | 8,785 |
Rotable Parts | ||
Property & Equipment, net: | ||
Aircraft and Flight Equipment | $ 13,992 | $ 9,150 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Accounts Receivable, allowance for credit losses | $ 175 | $ 250 |
Inventory, reserve for obsolescence | $ 1,255 | $ 1,275 |
Common stock-par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 995,000,000 | 995,000,000 |
Common stock, shares issued (in shares) | 58,168,497 | 57,872,452 |
Preferred stock-par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Treasury stock (in shares) | 1,823 | 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Operating Revenues: | ||||
Total Operating Revenue | $ 221,700 | $ 173,663 | $ 667,290 | $ 450,464 |
Operating Expenses: | ||||
Aircraft Fuel | 64,843 | 36,647 | 206,334 | 90,631 |
Salaries, Wages, and Benefits | 58,661 | 43,424 | 178,576 | 129,815 |
Aircraft Rent | 1,949 | 3,925 | 7,347 | 13,339 |
Maintenance | 11,018 | 9,660 | 35,794 | 30,170 |
Sales and Marketing | 6,827 | 5,470 | 23,336 | 16,402 |
Depreciation and Amortization | 17,181 | 14,710 | 49,364 | 41,532 |
Ground Handling | 8,669 | 7,873 | 24,838 | 19,654 |
Landing Fees and Airport Rent | 12,926 | 12,069 | 32,708 | 29,606 |
Special Items, net | 0 | (65) | 0 | (72,419) |
Other Operating, net | 24,235 | 18,629 | 68,401 | 50,026 |
Total Operating Expenses | 206,309 | 152,342 | 626,698 | 348,756 |
Operating Income | 15,391 | 21,321 | 40,592 | 101,708 |
Non-operating Income (Expense): | ||||
Interest Income | 1,610 | 28 | 2,166 | 52 |
Interest Expense | (7,493) | (6,286) | (23,097) | (19,487) |
Other, net | 3,422 | 456 | (5,156) | 18,505 |
Total Non-operating Expense, net | (2,461) | (5,802) | (26,087) | (930) |
Income Before Income Tax | 12,930 | 15,519 | 14,505 | 100,778 |
Income Tax Expense | 2,253 | 2,140 | 4,113 | 18,444 |
Net Income | $ 10,677 | $ 13,379 | $ 10,392 | $ 82,334 |
Net Income per share to common stockholders: | ||||
Basic (in dollars per share) | $ 0.18 | $ 0.23 | $ 0.18 | $ 1.51 |
Diluted (in dollars per share) | $ 0.18 | $ 0.22 | $ 0.17 | $ 1.40 |
Shares used for computation: | ||||
Basic (in shares) | 58,146,606 | 57,355,104 | 58,039,201 | 54,368,231 |
Diluted (in shares) | 60,793,516 | 61,712,378 | 61,372,735 | 58,699,991 |
Passenger | ||||
Operating Revenues: | ||||
Total Operating Revenue | $ 195,360 | $ 147,718 | $ 592,753 | $ 377,042 |
Cargo | ||||
Operating Revenues: | ||||
Total Operating Revenue | 23,687 | 24,400 | 65,930 | 68,084 |
Other | ||||
Operating Revenues: | ||||
Total Operating Revenue | $ 2,653 | $ 1,545 | $ 8,607 | $ 5,338 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||
Net Income | $ 10,677 | $ 13,379 | $ 10,392 | $ 82,334 |
Other Comprehensive Loss: | ||||
Net unrealized loss on Available-for-Sale securities, net of deferred tax benefit of $244, $—, $309 and $—, respectively | (562) | 0 | (782) | 0 |
Other Comprehensive Loss | (562) | 0 | (782) | 0 |
Comprehensive Income | $ 10,115 | $ 13,379 | $ 9,610 | $ 82,334 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Loans to Stockholders | Treasury Stock | Additional Paid-in Capital | Retained Earnings (Deficit) | Accumulated Other Comprehensive Loss |
Common stock, outstanding, at beginning of period (in shares) at Dec. 31, 2020 | 46,839,659 | ||||||
Balances, at beginning of period at Dec. 31, 2020 | $ 283,817 | $ 468 | $ (3,500) | $ 248,525 | $ 38,324 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Shares Surrendered by Stockholders (in shares) | (140,737) | ||||||
Shares Surrendered by Stockholders | 0 | $ (1) | 3,500 | (3,499) | |||
Initial Public Offering, net (in shares) | 10,454,545 | ||||||
Initial Public Offering, net | 224,657 | $ 105 | 224,552 | ||||
Net Income (Loss) | 16,778 | 16,778 | |||||
Income Tax Receivable Agreement | (115,200) | (115,200) | |||||
Amazon Warrants | 1,400 | 1,400 | |||||
Stock-based Compensation | 2,870 | 2,870 | |||||
Common stock, outstanding, at end of period (in shares) at Mar. 31, 2021 | 57,153,467 | ||||||
Balances, at end of period at Mar. 31, 2021 | 414,322 | $ 572 | 0 | 473,848 | (60,098) | ||
Common stock, outstanding, at beginning of period (in shares) at Dec. 31, 2020 | 46,839,659 | ||||||
Balances, at beginning of period at Dec. 31, 2020 | 283,817 | $ 468 | (3,500) | 248,525 | 38,324 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net Income (Loss) | 82,334 | ||||||
Common stock, outstanding, at end of period (in shares) at Sep. 30, 2021 | 57,551,741 | ||||||
Balances, at end of period at Sep. 30, 2021 | 487,142 | $ 576 | 0 | 481,108 | 5,458 | ||
Common stock, outstanding, at beginning of period (in shares) at Mar. 31, 2021 | 57,153,467 | ||||||
Balances, at beginning of period at Mar. 31, 2021 | 414,322 | $ 572 | 0 | 473,848 | (60,098) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net Income (Loss) | 52,177 | 52,177 | |||||
Amazon Warrants | 1,400 | 1,400 | |||||
Stock-based Compensation | 744 | 744 | |||||
Initial Public Offering Expense Adjustment | 349 | 349 | |||||
Stock Option Exercises (in shares) | 5,000 | ||||||
Stock Option Exercises | 27 | 27 | |||||
Common stock, outstanding, at end of period (in shares) at Jun. 30, 2021 | 57,158,467 | ||||||
Balances, at end of period at Jun. 30, 2021 | 469,019 | $ 572 | 0 | 476,368 | (7,921) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net Income (Loss) | 13,379 | 13,379 | |||||
Amazon Warrants | 1,400 | 1,400 | |||||
Stock-based Compensation | 964 | 964 | |||||
Stock Option Exercises (in shares) | 393,274 | ||||||
Stock Option Exercises | 2,380 | $ 4 | 2,376 | ||||
Common stock, outstanding, at end of period (in shares) at Sep. 30, 2021 | 57,551,741 | ||||||
Balances, at end of period at Sep. 30, 2021 | 487,142 | $ 576 | $ 0 | 481,108 | 5,458 | ||
Common stock, outstanding, at beginning of period (in shares) at Dec. 31, 2021 | 57,872,452 | ||||||
Balances, at beginning of period at Dec. 31, 2021 | $ 490,589 | $ 579 | $ 0 | 485,638 | 4,372 | $ 0 | |
Treasury Stock, at beginning of period (in shares) at Dec. 31, 2021 | 0 | 0 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net Income (Loss) | $ 3,637 | 3,637 | |||||
Amazon Warrants | 1,400 | 1,400 | |||||
Stock-based Compensation | 920 | 920 | |||||
Stock Option Exercises (in shares) | 91,868 | ||||||
Stock Option Exercises | 523 | $ 1 | 522 | ||||
Common stock, outstanding, at end of period (in shares) at Mar. 31, 2022 | 57,964,320 | ||||||
Balances, at end of period at Mar. 31, 2022 | 497,069 | $ 580 | $ 0 | 488,480 | 8,009 | 0 | |
Treasury Stock, at end of period (in shares) at Mar. 31, 2022 | 0 | ||||||
Common stock, outstanding, at beginning of period (in shares) at Dec. 31, 2021 | 57,872,452 | ||||||
Balances, at beginning of period at Dec. 31, 2021 | $ 490,589 | $ 579 | $ 0 | 485,638 | 4,372 | 0 | |
Treasury Stock, at beginning of period (in shares) at Dec. 31, 2021 | 0 | 0 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net Income (Loss) | $ 10,392 | ||||||
Common stock, outstanding, at end of period (in shares) at Sep. 30, 2022 | 58,168,497 | ||||||
Balances, at end of period at Sep. 30, 2022 | $ 508,005 | $ 582 | $ (52) | 493,493 | 14,764 | (782) | |
Treasury Stock, at end of period (in shares) at Sep. 30, 2022 | 1,823 | 1,823 | |||||
Common stock, outstanding, at beginning of period (in shares) at Mar. 31, 2022 | 57,964,320 | ||||||
Balances, at beginning of period at Mar. 31, 2022 | $ 497,069 | $ 580 | $ 0 | 488,480 | 8,009 | 0 | |
Treasury Stock, at beginning of period (in shares) at Mar. 31, 2022 | 0 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net Income (Loss) | (3,922) | (3,922) | |||||
Amazon Warrants | 1,400 | 1,400 | |||||
Stock-based Compensation | 575 | 575 | |||||
Stock Issued for Stock-Based Awards (in shares) | 181,404 | ||||||
Stock Issued for Stock-Based Awards | 1,038 | $ 1 | 1,037 | ||||
Net Stock Settlement of Stock-Based Awards (in shares) | 1,823 | ||||||
Net Stock Settlement of Stock-Based Awards | (52) | $ (52) | |||||
Other Comprehensive Loss | (220) | (220) | |||||
Common stock, outstanding, at end of period (in shares) at Jun. 30, 2022 | 58,145,724 | ||||||
Balances, at end of period at Jun. 30, 2022 | 495,888 | $ 581 | $ (52) | 491,492 | 4,087 | (220) | |
Treasury Stock, at end of period (in shares) at Jun. 30, 2022 | 1,823 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net Income (Loss) | 10,677 | 10,677 | |||||
Amazon Warrants | 1,400 | 1,400 | |||||
Stock-based Compensation | 487 | 487 | |||||
Stock Issued for Stock-Based Awards (in shares) | 22,773 | ||||||
Stock Issued for Stock-Based Awards | 115 | $ 1 | 114 | ||||
Other Comprehensive Loss | (562) | (562) | |||||
Common stock, outstanding, at end of period (in shares) at Sep. 30, 2022 | 58,168,497 | ||||||
Balances, at end of period at Sep. 30, 2022 | $ 508,005 | $ 582 | $ (52) | $ 493,493 | $ 14,764 | $ (782) | |
Treasury Stock, at end of period (in shares) at Sep. 30, 2022 | 1,823 | 1,823 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Cash flows from Operating Activities | ||
Net Income (Loss) | $ 10,392 | $ 82,334 |
Adjustments to reconcile Net Income to Cash from Operating Activities: | ||
Depreciation and Amortization | 49,364 | 41,532 |
Tax Receivable Agreement Adjustment | 5,000 | (19,800) |
Operating Lease Right-of-use Assets | (199) | 12,920 |
Non-Cash (Gain) Loss on Asset Transactions, net | (318) | 2 |
Unrealized (Gain) on Fuel Derivatives | 0 | (3,527) |
Amortization of Over-market Liabilities | (2,453) | (4,159) |
Deferred Income Taxes | 3,183 | 18,340 |
Amazon Warrants Vested | 4,200 | 4,200 |
Stock-based Compensation Expense | 1,981 | 4,577 |
Amortization of Debt Issuance Costs and Debt Securities | 467 | 963 |
Loss on Extinguishment of Debt | 1,557 | 1,224 |
Changes in Operating Assets and Liabilities: | ||
Accounts Receivable | (88) | 34 |
Inventory | (1,402) | (456) |
Prepaid Expenses | (3,188) | (3,153) |
Lessor Maintenance Deposits | (10,256) | (5,464) |
Aircraft Deposits | (2,569) | 1,162 |
Other Assets | (5,478) | 2,297 |
Accounts Payable | 8,674 | 2,257 |
Accrued Transportation Taxes | (1,736) | 2,999 |
Air Traffic Liabilities | 14,269 | 3,972 |
Loyalty Program Liabilities | (3,401) | (1,759) |
Operating Lease Obligations | (61) | (32,651) |
Other Liabilities | 3,733 | 8,514 |
Net Cash Provided by Operating Activities | 71,671 | 116,358 |
Cash Flows from Investing Activities: | ||
Purchases of Property & Equipment | (177,658) | (118,016) |
Proceeds from the Sale of Property & Equipment | 777 | 0 |
Proceeds from Insurance Settlements | 8,865 | 0 |
Purchases of Investments | (130,529) | (1,436) |
Proceeds from the Sale of Investments | 935 | 1,062 |
Net Cash Used in Investing Activities | (297,610) | (118,390) |
Cash Flows from Financing Activities: | ||
Cash Received from Stock Offering | 0 | 235,894 |
Costs of Stock Offering | 0 | (8,706) |
Proceeds from Stock Option and Warrant Exercises | 1,656 | 2,407 |
Taxes Paid for Net Stock Settlement of Stock-Based Awards | (31) | 0 |
Proceeds from Borrowings | 188,277 | 80,500 |
Repayment of Finance Lease Obligations | (37,842) | (9,113) |
Repayment of Borrowings | (95,305) | (75,728) |
Debt Issuance Costs | (2,526) | (2,560) |
Net Cash Provided by Financing Activities | 54,229 | 222,694 |
Net (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash | (171,710) | 220,662 |
Cash, Cash Equivalents and Restricted Cash--Beginning of the Period | 317,785 | 70,363 |
Cash, Cash Equivalents and Restricted Cash--End of the Period | 146,075 | 291,025 |
Non-cash transactions: | ||
Lease Deposits Applied Against the Purchase of Aircraft | 1,085 | 3,296 |
Aircraft and Flight Equipment Acquired through Finance Leases | 40,480 | 71,856 |
Finance Lease Asset Modifications | 46,311 | 0 |
Aircraft Acquired From Exercise of Finance Lease Purchase Option, net of Accumulated Depreciation | 28,012 | 0 |
Derecognition of Operating Lease Right-of-Use Assets, net | 8,674 | 41,135 |
Derecognition of Operating Lease Obligations | 8,674 | 44,726 |
Reconciliation of Cash, Cash Equivalents and Restricted Cash | ||
Cash and Cash Equivalents | 131,912 | 275,332 |
Restricted Cash | 14,163 | 15,693 |
Total Cash, Cash Equivalents and Restricted Cash | $ 146,075 | $ 291,025 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||
Deferred tax benefit | $ 244 | $ 0 | $ 309 | $ 0 |
COMPANY BACKGROUND
COMPANY BACKGROUND | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
COMPANY BACKGROUND | COMPANY BACKGROUND Sun Country Airlines Holdings, Inc. (together with its consolidated subsidiaries, "Sun Country" or the "Company") is the parent company of Sun Country, Inc., which is a certificated air carrier providing scheduled passenger service, air cargo service, charter air transportation and related services. Services are provided to the general public, cargo customers, military branches, wholesale tour operators, schools, companies and other individual entities for air transportation to various U.S. and international destinations. Except as otherwise stated, the financial information, accounting policies, and activities of Sun Country Airlines Holdings, Inc. are referred to as those of the "Company" or "Sun Country". Equity Transactions On April 11, 2018 (the "Acquisition Date"), certain investment funds (the “Apollo Funds”) managed by affiliates of Apollo Global Management, Inc. (“Apollo”) acquired Sun Country, Inc. For more information on the Company’s equity transactions, see Note 1 of Notes to the Consolidated Financial Statements included in Part II, Item 8 “Financial Statements” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 as filed with the U.S. Securities and Exchange Commission (“2021 10-K”). Initial Public Offering of Common Stock On March 16, 2021, the Company priced its initial public offering of 9,090,909 shares of common stock to the public at $24.00 per share. The stock began trading on the NASDAQ on March 17, 2021 under the symbol "SNCY". The underwriters had an option to purchase an additional 1,363,636 shares from the Company at the public offering price, which they exercised. In total, all 10,454,545 shares were issued on March 19, 2021 and the net proceeds to the Company were $225,329 after deducting underwriting discounts and commissions, and other offering expenses. Concurrently with the closing of the initial public offering, SCA Horus Holdings, LLC, an affiliate of investment funds managed by affiliates of Apollo (the “Apollo Stockholder”), also completed a private placement in which the Apollo Stockholder sold 2,216,312 and 2,216,308 shares of common stock to PAR Investment Partners, L.P. and certain funds or accounts managed by an investment adviser subsidiary of Blackrock, Inc., respectively. Each of the two sales was based on an aggregate purchase price of $50,000 and a price per share equal to 94% of the initial public offering price of $24.00 per share. Secondary Offerings During May 2021 and October 2021, the Apollo Stockholder and other selling stockholders sold 7,250,000 and 8,500,000 shares of the Company's common stock at the public offering prices of $34.50 and $32.50, respectively. Under both transactions, the underwriters were given options to purchase additional shares of the Company's common stock at the public offering price. During the May 2021 and October 2021 offerings, the underwriters elected to purchase 1,087,500 and 435,291 of the option shares, respectively. The Company incurred offering expenses of $1,763 in conjunction with the two secondary offerings a nd did not receive any of the proceeds from these offerings. For more information on the 2021 secondary offerings, see Note 1 of Notes to the Consolidated Financial Statements included in Part II, Item 8 “Financial Statements” in the 2021 10-K. Amazon Agreement On December 13, 2019, the Company signed a six-year contract (with two, two-year extension options, for a maximum term of 10 years) with Amazon.com Services, Inc. (together with its affiliates, “Amazon”) to provide cargo services under an Air Transportation Services Agreement (the “ATSA”). In connection with the ATSA, the Company issued warrants to Amazon to purchase an aggregate of up to 9,482,606 shares of common stock at an exercise price of approximately $15.17 per share. There were 632,183 warrants that vested upon execution of the ATSA and 63,217 warrants will vest for each milestone of $8,000 in qualifying payments made by Amazon to the Company. During the nine months ended September 30, 2022 and September 30, 2021, 568,956 warrants vested in each respective period. As of September 30, 2022 and September 30, 2021, the cumulative vested warrants held by Amazon were 2,212,615 and 1,454,008, respectively. The exercise period of these warrants is through the eighth anniversary of the issue date. |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION The Company has prepared the Condensed Consolidated Financial Statements according to U.S. Generally Accepted Accounting Principles (“GAAP”) and has included the accounts of Sun Country Airlines Holdings, Inc. and its subsidiaries. The accompanying unaudited Condensed Consolidated Financial Statements of Sun Country Airlines Holdings, Inc. should be read in conjunction with the Consolidated Financial Statements contained in the 2021 10-K. Management believes that all adjustments necessary for the fair presentation of results, consisting of normally recurring items, have been included in the unaudited Condensed Consolidated Financial Statements for the interim periods presented. The Company reclassified certain prior period amounts to conform to the current period presentation. All material intercompany balances and transactions have been eliminated in consolidation. The preparation of financial statements in accordance with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates. Significant areas of judgment relate to passenger revenue recognition, maintenance under the built-in overhaul method, equity-based compensation, tax receivable agreement, lease accounting, impairment of goodwill, impairment of long-lived and intangible assets, air traffic liabilities, the loyalty program, as well as the valuation of Amazon warrants. During the nine months ended September 30, 2022, there were no significant changes to the Company’s critical accounting policies. Due to impacts from the global coronavirus (“COVID-19”) pandemic, seasonal variations in the demand for air travel, the volatility of aircraft fuel prices, uncertainties in pilot staffing, the impact of macroeconomic conditions including inflationary pressures, and other factors, operating results for the nine months ended September 30, 2022 are not necessarily indicative of operating results for future quarters or for the year ending December 31, 2022. Air travel is also significantly impacted by general economic conditions, the amount of disposable income available to consumers, unemployment levels, corporate travel budgets, extreme or severe weather and natural disasters, disease outbreaks, fears of terrorism or war, and other factors beyond the Company's control. Revision of Previously Issued Consolidated Financial Statements During the second quarter of 2022, the Company identified an immaterial misstatement in its Condensed Consolidated Financial Statements for the quarter and year-to-date interim periods in the year ended December 31, 2021 (the "previously issued financial statements"). The error related to the improper application of Accounting Standards Codification (ASC) Topic 842, Leases regarding the treatment of the incremental difference between the net purchase price of the leased aircraft and the net operating lease recorded on the balance sheet immediately prior to the transaction. This difference should have been capitalized as part of the acquisition costs incurred to purchase the aircraft off the operating lease. The Company incorrectly expensed this amount as incurred within Special Items, net on the Condensed Consolidated Statements of Operations. The error resulted in an understatement of the benefit within Special Items, net, partially offset by incremental Depreciation and Amortization Expense for the three and nine months ended September 30, 2021, and an understatement of Aircraft and Flight Equipment. The Company assessed the materiality of the errors on the prior period financial statements in accordance with Securities and Exchange Commission Staff Accounting Bulletin No. 99, Materiality , codified in ASC 250, Presentation of Financial Statements . Management concluded it was immaterial to the Company's previously issued annual or interim financial statements. The Company has revised the previously issued financial statements as presented in these Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q. In addition, the immaterial error has and will continue to be corrected in the comparative amounts presented in the Company’s subsequent quarterly and annual filings. The impact of the revision on the Company's previously issued Consolidated Balance Sheets as of December 31, 2021 are as follows: December 31, 2021 As Previously Issued Correction As Revised Assets Aircraft and Flight Equipment $ 440,356 $ 6,963 $ 447,319 Total Property & Equipment 688,624 6,963 695,587 Accumulated Depreciation & Amortization (115,013) (2,056) (117,069) Total Property & Equipment, net 573,611 4,907 578,518 Deferred Tax Asset 18,737 (1,129) 17,608 Total Other Assets 427,590 (1,129) 426,461 Total Assets 1,376,644 3,778 1,380,422 Stockholder's Equity Retained Earnings 594 3,778 4,372 Total Stockholders' Equity 486,811 3,778 490,589 Total Liabilities and Stockholders' Equity 1,376,644 3,778 1,380,422 The impact of the revision on the Company's previously issued Condensed Consolidated Statements of Operations for the three and nine-month periods ended September 30, 2021 are as follows: Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 As Previously Issued Correction As Revised As Previously Issued Correction As Revised Operating Expenses Depreciation and Amortization $ 14,029 $ 681 $ 14,710 $ 40,103 $ 1,429 $ 41,532 Special Items, net (65) — (65) (65,456) (6,963) (72,419) Total Operating Expenses 151,661 681 152,342 354,290 (5,534) 348,756 Operating Income 22,002 (681) 21,321 96,174 5,534 101,708 Income Before Income Tax 16,200 (681) 15,519 95,244 5,534 100,778 Income Tax Expense 2,297 (157) 2,140 17,172 1,272 18,444 Net Income 13,903 (524) 13,379 78,072 4,262 82,334 Basic Income per share $ 0.24 $ (0.01) $ 0.23 $ 1.44 $ 0.07 $ 1.51 Diluted Income per share $ 0.23 $ (0.01) $ 0.22 $ 1.33 $ 0.07 $ 1.40 The revision also impacted the Company's previously issued Condensed Consolidated Statements of Changes in Stockholders Equity as follows: For the Three Months Ended June 30, 2021 For the Three Months Ended March 31, 2021 As Previously Issued Correction As Revised As Previously Issued Correction As Revised Net Income $ 51,753 $ 424 $ 52,177 $ 12,416 $ 4,362 $ 16,778 As of March 31, 2022 As of September 30, 2021 As Previously Issued Correction As Revised As Previously Issued Correction As Revised Retained Earnings $ 4,231 $ 3,778 $ 8,009 $ 1,196 $ 4,262 $ 5,458 Total Stockholders' Equity 493,291 3,778 497,069 482,880 4,262 487,142 As of June 30, 2021 As of March 31, 2021 As Previously Issued Correction As Revised As Previously Issued Correction As Revised Retained Earnings (Deficit) $ (12,707) $ 4,786 $ (7,921) $ (64,460) $ 4,362 $ (60,098) Total Stockholders' Equity 464,233 4,786 469,019 409,960 4,362 414,322 The Company's Condensed Consolidated Statement of Changes Stockholders' Equity as of December 31, 2021 has been corrected to reflect the changes to the impacted Stockholders' Equity accounts as described above. The impact of the revision on the Company's previously issued Condensed Consolidated Statements of Cash Flow for the nine months ended September 30, 2021 is as follows: Nine Months Ended September 30, 2021 As Previously Issued Correction As Revised Operating Activities Net Income $ 78,072 $ 4,262 $ 82,334 Depreciation and Amortization 40,103 1,429 41,532 Non-Cash (Gain) Loss on Asset Transaction, Net (12,666) 12,668 2 Deferred Income Taxes 17,068 1,272 18,340 Operating Lease Obligations (19,983) (12,668) (32,651) Net Cash Provided by Operating Activities 109,395 6,963 116,358 Investing Activities Purchases of Property & Equipment (111,053) (6,963) (118,016) Net Cash Used in Investing Activities (111,427) (6,963) (118,390) The revision had no impact on the Company's Net Cash Provided by Financing Activities for the nine months ended September 30, 2021. Investments Investments consist of debt securities and Certificates of Deposit. The Certificates of Deposit are recorded at cost, plus accrued interest. These certificates serve as collateral for letters of credit required by various airports and other vendors. All of the certificates have original maturities greater than 90 days. During the nine months ended September 30, 2022, the Company purchased debt securities with original maturities of three months or greater. The investments are classified as Current Assets on the Condensed Consolidated Balance Sheets because the securities are highly liquid and are available to be quickly converted into known amounts of cash to fund current operations. Most of the Company's Available-for-Sale securities will mature within one year. The Company limits its exposure to any one issuer or market sector, and largely limits its investments to investment grade quality securities. The Company's investment securities are classified as Available-for-Sale and are reported at fair value on the Company's Condensed Consolidated Balance Sheets. Unrealized gains and losses on the Company's Available-for-Sale securities are excluded from net earnings and are reported as a component of Accumulated Other Comprehensive Income, net of income tax effects, within Stockholders' Equity on the Condensed Consolidated Balance Sheets until realized. Realized gains and losses are recorded using the specific identification method and reflected in Other, net within Non-operating Income (Expense) on the Company's Condensed Consolidated Statement of Operations. Premiums and discounts recorded on Available-for-Sale debt securities are accounted for in Interest Income within Non-operating Income (Expense) on the Company's Condensed Consolidated Statement of Operations. At each reporting period, the Company assesses its Available-for-Sale investments in an unrealized loss position to determine whether an impairment exists. The Company will record an impairment if management intends to sell an impaired security, will likely be required to sell a security before recovery of the entire amortized cost, or the same level of collectible cash flows from the security is no longer expected. The entire impairment will be included in Other, net within Non-operating Income (Expense) on the Company's Condensed Consolidated Statement of Operations. Recently Adopted Accounting Standards In May 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options. This new standard provides clarification and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (such as warrants) that remain equity classified after modification or exchange. On January 1, 2022, the Company adopted ASU 2021-04 on a prospective basis, as required by the Standard. There was no financial statement impact upon adoption. In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832), Disclosures by Business Entities about Government Assistance . The new standard requires additional disclosures regarding government grants and money contributions. The standard requires disclosures on the nature of the transactions and related accounting policies, including significant terms and conditions, as well as the amounts and specific financial statement line items affected by the transactions. The Company adopted this standard as of January 1, 2022. See Note 3 for additional information on COVID-19 related government assistance the Company has received. |
IMPACT OF THE COVID-19 PANDEMIC
IMPACT OF THE COVID-19 PANDEMIC | 9 Months Ended |
Sep. 30, 2022 | |
Unusual or Infrequent Items, or Both [Abstract] | |
IMPACT OF THE COVID-19 PANDEMIC | IMPACT OF THE COVID-19 PANDEMIC The COVID-19 pandemic resulted in a dramatic decline in passenger demand across the U.S. airline industry. Sun Country experienced a significant decrease in demand related to the COVID-19 pandemic, which caused a material decline in 2021 revenues as compared to pre-pandemic levels, and negatively impacted the Company’s financial condition and operating results. During the third quarter of 2022, Sun Country continued to see recovery in demand from the COVID-19 pandemic relative to demand in 2021, which may impact the comparability of results to prior periods. However, the ongoing impact of the COVID-19 pandemic on overall demand for air travel remains uncertain and cannot be predicted at this time. Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) During 2021 and 2020, the Company received certain funds from the CARES Act. The cash awarded to the Company through the CARES Act was accounted for as grants, debt, and tax credits based on the terms and nature of the funds awarded. During the nine months ended September 30, 2021, the Company received and recognized as income within Special Items, net $71,587 from the U.S. Treasury under the Payroll Support Program Extension (“PSP2”) and the American Rescue Plan Act of 2021 ("PSP3"). The CARES Act provides an employee retention credit (“CARES Employee Retention Credit”), which is a refundable tax credit against certain employment taxes. During the nine months ended September 30, 2021, the Company recorded $848 related to the CARES Employee Retention Credit within Special Items, net. Under the CARES Act Loan Program, the Company received a $45,000 loan (the “CARES Act Loan”) from the U.S. Treasury, which was repaid in full on March 24, 2021 using proceeds from the IPO. For more information on funds awarded through the CARES Act, see Note 3 of Notes to the Consolidated Financial Statements included in Part II, Item 8 “Financial Statements” in the 2021 10-K. |
REVENUE
REVENUE | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE Sun Country is a certificated air carrier generating Operating Revenues from Scheduled service, Charter service, Ancillary, Cargo and Other revenue. Scheduled service revenue mainly consists of base fares. Charter service revenue is primarily generated through service provided to the U.S. Department of Defense, collegiate and professional sports teams, and casinos. Ancillary revenues consist of revenue earned from air travel-related services, such as: baggage fees, seat selection fees, passenger interface fee and on-board sales. Cargo consists of revenue earned from flying cargo aircraft under the ATSA. Other revenue consists primarily of revenue from services in connection with Sun Country Vacations products. The significant categories comprising Operating Revenues are as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Scheduled Service $ 102,200 $ 80,212 $ 334,679 $ 201,905 Charter Service 42,899 33,809 118,526 88,511 Ancillary 50,261 33,697 139,548 86,626 Passenger 195,360 147,718 592,753 377,042 Cargo 23,687 24,400 65,930 68,084 Other 2,653 1,545 8,607 5,338 Total Operating Revenue $ 221,700 $ 173,663 $ 667,290 $ 450,464 The Company attributes and measures its Operating Revenue by geographic region as defined by the DOT for airline reporting based upon the origin of each passenger and cargo flight segment. The Company’s operations are highly concentrated in the U.S., but include service to many international locations, primarily based on scheduled service to Latin America during the winter season and on military charter services. Total Operating Revenues by geographic region are as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Domestic $ 214,904 $ 167,660 $ 634,963 $ 429,508 Latin America 6,756 5,447 32,182 19,870 Other 40 556 145 1,086 Total Operating Revenue $ 221,700 $ 173,663 $ 667,290 $ 450,464 Contract Balances The Company’s contract assets primarily relate to costs incurred to get Amazon cargo aircraft ready for service. The balances are included in Other Current Assets and Other Assets on the Condensed Consolidated Balance Sheets. These deferred up-front costs are being amortized into Maintenance Expense on a pro-rata basis over the initial six years of the ATSA. The amount expensed during the three and nine months ended September 30, 2022 was $151 and $469, respectively. The expense for both the three and nine months ended September 30, 2021 was $208 and $515, respectively. The Company’s significant contract liabilities are comprised of: 1) ticket sales for transportation that has not yet been provided (reported as Air Traffic Liabilities on the Condensed Consolidated Balance Sheets), 2) outstanding loyalty points that may be redeemed for future travel and other non-air travel awards (reported as Loyalty Program Liabilities on the Condensed Consolidated Balance Sheets) and, 3) the Amazon Deferred Up-front Payment received (reported within Other Liabilities on the Condensed Consolidated Balance Sheets). As part of the ATSA executed in December 2019, Amazon paid the Company $10,300 toward start-up costs. Upon signing the ATSA, Amazon received 632,183 fully vested warrants to purchase the Company’s common stock, with a fair value of $4,667. This fair value was assigned to a portion of the $10,300 cash received from Amazon and the remaining $5,633 was recorded in Other Liabilities on the Company’s Condensed Consolidated Balance Sheets. This deferred up-front payment is being amortized into revenue on a pro-rata basis over the initial six years of the ATSA. For the three and nine months ended September 30, 2022, $225 and $699 was amortized into Cargo revenue, respectively. For the three and nine months ended September 30, 2021, $310 and $779 was amortized into Cargo revenue, respectively. Contract Assets and Liabilities are as follows: September 30, 2022 December 31, 2021 Contract Assets Costs to fulfill contract with Amazon $ 2,350 $ 2,819 Air Traffic Liabilities 132,830 118,562 Loyalty Program Liabilities 16,317 19,718 Amazon Deferred Up-front Payment 3,501 4,200 Total Contract Liabilities $ 152,648 $ 142,480 The balance in the Air Traffic Liabilities fluctuates with seasonal travel patterns. Most tickets can be purchased no more than twelve months in advance, therefore any revenue associated with tickets sold for future travel will be recognized within that timeframe. For the nine months ended September 30, 2022, $109,852 of revenue was recognized in Passenger revenue that was included in the Air Traffic Liabilities as of December 31, 2021. Loyalty Program The Sun Country Rewards program provides loyalty awards to program members based on accumulated loyalty points. The Company records a liability for loyalty points earned by passengers under the Sun Country Rewards program using two methods: (1) a liability for points that are earned by passengers on purchases of the Company’s services is established by deferring revenue based on the redemption value, net of estimated loyalty points that will expire unused, or breakage; and (2) a liability for points attributed to loyalty points issued to the Company’s Visa card holders is established by deferring a portion of payments received from the Company’s co-branded agreement. The balance of the Loyalty Program Liabilities fluctuates based on seasonal patterns, which impacts the volume of loyalty points awarded through travel or issued to co-branded credit card and other partners (deferral of revenue) and loyalty points redeemed (recognition of revenue). Due to these reasons, the timing of loyalty point redemptions can vary significantly. Changes in the Loyalty Program Liabilities are as follows: 2022 2021 Balance – January 1 $ 19,718 $ 22,069 Loyalty Points Earned 5,125 3,058 Loyalty Points Redeemed (1) (8,526) (4,816) Balance – September 30 $ 16,317 $ 20,311 ______________________ (1) Loyalty points are combined in one homogenous pool, that includes both air and non-air travel awards, and are not separately identifiable. As such, the revenue recognized is comprised of points that were part of the Loyalty Program Liabilities balance at the beginning of the period, as well as points that were earned during the period. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE The following table shows the computation of basic and diluted earnings per share: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Numerator: Net Income $ 10,677 $ 13,379 $ 10,392 $ 82,334 Denominator: Weighted Average Common Shares Outstanding - Basic 58,146,606 57,355,104 58,039,201 54,368,231 Dilutive effect of Stock Options, RSUs and Warrants (1) 2,646,910 4,357,274 3,333,534 4,331,760 Weighted Average Common Shares Outstanding - Diluted 60,793,516 61,712,378 61,372,735 58,699,991 Basic earnings per share $ 0.18 $ 0.23 $ 0.18 $ 1.51 Diluted earnings per share $ 0.18 $ 0.22 $ 0.17 $ 1.40 ______________________ (1) There were 3,221,617 and 3,626,851 performance-based stock options outstanding at September 30, 2022 and 2021, respectively. As of September 30, 2022 and 2021, the Company expected approximately 63% and 75% of these options to vest, respectively. As of September 30, 2022, 32.5% of the eligible outstanding performance-based stock options vested and were considered exercisable. These amounts are included in the measure above to the extent they are dilutive. The Company's anti-dilutive shares for the periods presented were immaterial to the Condensed Consolidated Financial Statements. |
AIRCRAFT
AIRCRAFT | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
AIRCRAFT | AIRCRAFT As of September 30, 2022, Sun Country operated a fleet of 54 Boeing 737-NG aircraft, consisting of 53 Boeing 737-800s and one Boeing 737-700. The following tables summarize the Company’s aircraft fleet activity for the nine months ended September 30, 2022 and 2021, respectively: December 31, 2021 Additions Reclassifications Removals September 30, 2022 Passenger: Owned 21 5 4 (1) 29 Finance leases (1) 9 2 — — 11 Operating leases 6 — (4) — 2 Sun Country Airlines’ Fleet 36 7 — (1) 42 Cargo: Aircraft Operated for Amazon 12 — — — 12 Total Aircraft Operated 48 7 — (1) 54 December 31, 2020 Additions Reclassifications Removals September 30, 2021 Passenger: Owned 14 1 6 — 21 Finance leases 5 3 — — 8 Operating leases 12 — (6) — 6 Sun Country Airlines’ Fleet 31 4 — — 35 Cargo: Aircraft Operated for Amazon 12 — — — 12 Total Aircraft Operated 43 4 — — 47 (1) Two aircraft operating leases were reclassified into finance lease and two separate aircraft finance lease purchase options were exercised, resulting in a net change of zero finance lease reclassifications. During the nine months ended September 30, 2022, the Company acquired seven incremental aircraft, five of which were financed using proceeds from the issuance of Class A and Class B pass-through trust certificates (the "2022-1 EETC"), and two through finance lease arrangements. As of September 30, 2022, 26 of the owned aircraft were financed and three aircraft were unencumbered. For more information on the Company's financing arrangements, see Note 7 of these Condensed Consolidated Financial Statements. During the nine months ended September 30, 2022, the Company completed transactions that adjusted the composition of its fleet. The Company executed lease amendments to purchase two aircraft at the end of the lease term, which modified the classification from operating leases to finance leases with expiration dates in fiscal year 2026. The Company purchased two aircraft previously classified as finance leases, using proceeds from the 2022-1 EETC. Additionally, the Company purchased two aircraft previously classified as operating leases, both of which are now unencumbered. During the nine months ended September 30, 2022, an owned aircraft was retired due to the aircraft sustaining damage beyond economic repair. The retirement had no impact on the Company's Condensed Consolidated Results of Operations. See Note 13 for more information. Six of the aircraft purchased during the nine months ended September 30, 2021 were financed through the Delayed Draw Term Loan Facility. See Note 7 for additional information. All six aircraft were previously accounted for as operating leases. The Company also acquired four incremental aircraft, one of which was purchased, and three through finance lease arrangements. Depreciation, amortization, and rent expense on aircraft are as follows: Three Months Ended September 30, Nine Months Ended September 30, Aircraft Status Expense Type 2022 2021 2022 2021 Owned Depreciation $ 10,179 $ 9,284 $ 29,027 $ 26,514 Finance Leased Amortization 4,419 2,977 12,533 7,846 Operating Leased Aircraft Rent (1) 1,949 3,925 7,347 13,339 $ 16,547 $ 16,186 $ 48,907 $ 47,699 (1) Aircraft Rent expense includes credits for the amortization of over-market liabilities established at the Acquisition Date. Depreciation expense on owned aircraft and amortization expense on finance leased aircraft are both classified in Depreciation and Amortization on the Condensed Consolidated Statements of Operations. Aircraft Maintenance Deposits Contra-Assets As of the Acquisition Date, the Company established a maintenance deposit contra-asset to offset the acquired maintenance deposits assets included in Short-term Lessor Maintenance Deposits on the Condensed Consolidated Balance Sheets. The assets represent deposits remitted by the previous owners of the Company to the lessor for maintenance events. The contra-assets represent the Company’s obligation to perform planned maintenance events on leased aircraft held as of the Acquisition date. As reimbursable maintenance events are performed and Maintenance Expense is incurred, a portion of the contra-asset is recognized as a reduction to Maintenance Expense on the Condensed Consolidated Statements of Operations due to the fact that the previously acquired maintenance deposit is partially funding the maintenance event. As of September 30, 2022 and December 31, 2021, the remaining balance of the contra-asset was $13,211 and $22,348, respectively. Of the $9,137 reduction in the contra-asset during the nine months ended September 30, 2022, $8,362 is related to the purchase of two aircraft previously under operating leases. The contra-assets reduced the acquisition costs incurred to purchase the aircraft off the operating lease. Over-market Liabilities As of the Acquisition Date, the Company recognized a liability representing lease terms which are unfavorable compared with market terms of similar leases. The over-market lease liability is recorded as a contra-asset offsetting the corresponding lease asset. The remaining unamortized balance of this contra-asset as of September 30, 2022 and December 31, 2021 was $132 and $10,363, respectively and is recorded within Operating Lease Right-of-Use Assets. During the first quarter of 2022, the Company executed lease amendments which modified two aircraft from operating leases to finance leases. As a result of the modifications, the Company reclassified $9,687 of the over-market lease liability from Operating Lease Right-of-Use Assets to Finance Lease Assets. The resulting reclassification reduced the go-forward Depreciation and Amortization for the related Finance Lease Assets. Additionally, $173 of the reduction is related to the purchase of two aircraft previously under operating leases in the three months ended September 30, 2022. The contra-assets reduced the acquisition costs incurred to purchase the aircraft off the operating lease. As of the Acquisition Date, Sun Country’s existing leases included payments for maintenance reserves in addition to the stated aircraft lease payments. For a substantial portion of these maintenance reserve payments, the Company does not expect to be reimbursed by the lessor. Therefore, a liability was established representing over-market maintenance reserve lease terms compared to market terms of similar leases. The remaining balance of this liability at September 30, 2022 and December 31, 2021 was $2,958 and $14,737, respectively. Of the $11,779 reduction in the over-market maintenance reserve liabilities during the nine months ended September 30, 2022, $6,023 was incorporated into the Finance Lease Assets in accordance with the terms of the executed lease amendments, as described above. Additionally, $3,303 of the reduction is related to the purchase of two aircraft previously under operating leases. The maintenance deposits were allocated to the acquisition costs incurred to purchase the aircraft off the operating lease. |
DEBT
DEBT | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Credit Facilities – On February 10, 2021, the Company executed a five-year credit agreement (the “Credit Agreement”) with a group of lenders that replaced the Company’s prior $25,000 asset-based revolving credit facility. The Credit Agreement includes a $25,000 Revolving Credit Facility (the "Revolving Credit Facility") and a $90,000 Delayed Draw Term Loan Facility (“DDTL”), which are collectively referred to as the “Credit Facilities.” The proceeds from the Revolving Credit Facility can be used for general corporate purposes, whereas the proceeds from the DDTL were to be used solely to finance the acquisition of aircraft or engines to be registered in the United States. The Credit Agreement includes financial covenants that require a minimum trailing 12-month EBITDAR ($87,700 as of March 31, 2022 and beyond) and minimum liquidity of $30,000 at the close of any business day. The Company was in compliance with these covenants as of September 30, 2022. During 2021, the Company drew $80,500 on the DDTL to purchase six aircraft, which were previously under operating leases. During the first quarter of 2022, the Company repaid the outstanding balance of the DDTL in full using proceeds it received from the 2022-1 EETC, which terminated the DDTL. As a result, no amounts under the DDTL were available to the Company as of September 30, 2022. The Company recorded a $1,557 loss on extinguishment of debt related to the repayment of the DDTL, which represents the write-off of the unamortized deferred financing costs. As of September 30, 2022, the Revolving Credit Facility remained undrawn and $24,650 was available to the Company. Long-term Debt – In December 2019, the Company arranged for the issuance of Class A, Class B and Class C pass-through trust certificates Series 2019-1 (the “2019-1 EETC”), in an aggregate face amount of $248,587 for the purpose of financing or refinancing 13 used aircraft, which was completed in 2020. In March 2022, the Company arranged for the issuance of the 2022-1 EETC in an aggregate face amount of $188,277 for the purpose of financing or refinancing 13 aircraft. The Company recorded $2,526 in debt issuance costs associated with the 2022-1 EETC. Of the 13 aircraft financed by the 2022-1 EETC during the nine months ended September 30, 2022, five were existing owned aircraft previously financed by the DDTL, two of the aircraft were owned outright, four of the aircraft were acquired incrementally, and two aircraft were bought-out from an existing finance lease. The Company is required to make semi-annual principal and interest payments each March and September, the first payment occurred on September 15, 2022. The 2022-1 EETC is secured by a lien on the financed or refinanced aircraft and will be cross-collateralized by the other aircraft financed through the issuance. Total appraised value of the aircraft and engines financed by the 2022-1 EETC was approximately $259,688 as of the original date of the agreement. During the nine months ended September 30, 2022, the Company capitalized $2,327 of Interest Expense related to aircraft financed with the proceeds of the 2022-1 EETC while undergoing induction. Long-term Debt includes the following: September 30, 2022 December 31, 2021 Notes payable under the Company's 2019-1 EETC agreement dated December 2019, with original loan amounts of $248,587 payable in bi-annual installments, in June and December, through December 2027. These notes bear interest at an annual rate between 4.13% and 6.95% and the weighted average interest rate is 4.73% as of September 30, 2022. $ 194,884 $ 202,984 Notes payable under the Company's 2022-1 EETC agreement dated March 2022, with a face amount of $188,277 payable in bi-annual installments, in March and September, through March 2031. These notes bear interest at an annual rate between 4.84% and 5.75% and the weighted average interest rate is 5.06% as of September 30, 2022. 179,019 — Delayed Draw Term Loan Facility — 77,481 Other Notes payable — 466 Total Debt 373,903 280,931 Less: Unamortized debt issuance costs (3,706) (3,505) Less: Current Maturities of Long-term Debt (45,535) (29,412) Total Long-term Debt $ 324,662 $ 248,014 Future maturities of the outstanding Debt are as follows: Debt Principal Amortization of Debt Net Debt Remainder of 2022 $ 18,187 $ (264) $ 17,923 2023 58,518 (962) 57,556 2024 60,157 (777) 59,380 2025 65,241 (602) 64,639 2026 45,668 (415) 45,253 Thereafter 126,132 (686) 125,446 Total as of September 30, 2022 $ 373,903 $ (3,706) $ 370,197 The fair value of Debt was $340,067 as of September 30, 2022 and $272,004 as of December 31, 2021. The fair value of the Company’s debt was based on the discounted amount of future cash flows using the Company’s end-of-period estimated incremental borrowing rate for similar obligations. The estimates were primarily based on Level 3 inputs. |
FUEL DERIVATIVES AND RISK MANAG
FUEL DERIVATIVES AND RISK MANAGEMENT | 9 Months Ended |
Sep. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
FUEL DERIVATIVES AND RISK MANAGEMENT | FUEL DERIVATIVES AND RISK MANAGEMENT The Company’s operations are inherently dependent upon the price of aircraft fuel. To manage economic risks associated with fluctuations in aircraft fuel prices, the Company periodically enters into fuel option and swap contracts. The Company does not apply hedge accounting to its fuel derivative contracts, nor does it hold or issue them for trading purposes. As of September 30, 2022 and December 31, 2021, the Company had no outstanding fuel derivative contracts. Fuel derivative contracts are recognized at fair value on the Condensed Consolidated Balance Sheets as Derivative Assets, if the fair value is in an asset position, or as Derivative Liabilities, if the fair value is in a liability position. Derivatives where the payment due date is greater than one year from the balance sheet date are classified as long-term. Fuel derivative gains and losses are classified in Aircraft Fuel on the Condensed Consolidated Statements of Operations. Changes in Derivative Assets (Liabilities) are as follows: Nine Months Ended September 30, 2022 2021 Balance - January 1 $ — $ (1,174) Non-cash Gains — 3,527 Contract Settlements — (2,105) Balance - September 30 $ — $ 248 Fuel Derivative Gains (Losses) consist of the following: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Total Fuel Derivative Gains (Losses) $ — $ (72) $ — $ 3,527 No cash premiums were paid in any of the periods presented above. |
INVESTMENTS
INVESTMENTS | 9 Months Ended |
Sep. 30, 2022 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENTS | INVESTMENTS A summary of debt securities by major security type: September 30, 2022 (1) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-Sale Securities (2) : Municipal Debt Securities $ 41,108 $ — $ (331) $ 40,777 Corporate Debt Securities 83,547 — (695) 82,852 U.S. Government Agency Securities 5,005 — (65) 4,940 Total $ 129,660 $ — $ (1,091) $ 128,569 (1) As the Company began purchasing these investment securities during the second quarter of 2022, there is no comparable prior period information. (2) The Company also holds Certificates of Deposit that are included in Investments on the Condensed Consolidated Balance Sheets totaling $6,601 and $6,283 as of September 30, 2022 and December 31, 2021, respectively. As of September 30, 2022, the Company's investments that have unrealized losses have been in a continuous unrealized loss position for less than 12 months. The unrealized losses were the result of increases in market interest rates and were not the result of a deterioration in the credit quality of the securities. As of September 30, 2022, the Company believes that any unrealized losses are recoverable prior to the investment's conversion to cash. Therefore, the Company believes these losses to be temporary. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS For a description of the methods and assumptions that are used to estimate the fair value and determine the fair value hierarchy classification of each class of financial instrument, see Note 12 of the Notes to the Consolidated Financial Statements in Part II, Item 8, “Financial Statements” in the 2021 10-K. Financial Instruments – Financial instruments including Restricted Cash, Certificates of Deposit, Accounts Receivable, Accounts Payable and all other Current Liabilities have carrying values that approximate fair value. Cash & Cash Equivalents – The carrying value of cash and cash equivalents approximates fair value. Fair values of cash equivalent instruments that do not trade on a regular basis in active markets are classified as Level 2. Available-for-Sale Securities - Available-for-Sale investment securities include debt securities, such as municipal, corporate, and U.S. government agency notes. All of these investments are classified as Level 2 because they do not trade in active markets on a regular basis. The Company obtains its pricing per security from a third-party, which uses quoted market prices, when available, or other observable inputs for determination of fair value. Non-Financial Assets – Certain assets are measured at fair value on a nonrecurring basis. The Company’s non-financial assets, which primarily consist of Property & Equipment, Goodwill and Other Intangible Assets are not required to be measured at fair value on a recurring basis and are reported at carrying value. However, on a periodic basis whenever events or changes in circumstances indicate that their carrying value may not be recoverable, non-financial assets are assessed for impairment and, if applicable, written down to fair value using significant unobservable inputs, classified as Level 3. Debt – See Note 7 for more information on the Company's debt financings and related fair values. The following table summarizes the assets measured at fair value on a recurring basis: September 30, 2022 Level 1 Level 2 Level 3 Total Cash & Cash Equivalents $ 70,925 $ 60,987 $ — $ 131,912 Available-for-Sale Securities: Municipal Debt Securities — 40,777 — 40,777 Corporate Debt Securities — 82,852 — 82,852 U.S. Government Agency Securities — 4,940 — 4,940 Total Available-for-Sale Securities — 128,569 — 128,569 Total Assets Measured at Fair Value on a Recurring Basis $ 70,925 $ 189,556 $ — $ 260,481 December 31, 2021 Level 1 Level 2 Level 3 Total Cash & Cash Equivalents $ 309,338 $ — $ — $ 309,338 Total Assets Measured at Fair Value on a Recurring Basis $ 309,338 $ — $ — $ 309,338 |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The Company's effective tax rate for the three and nine months ended September 30, 2022 was 17.4% and 28.4%, respectively. The effective tax rate for the three and nine months ended September 30, 2021 was 13.8% and 18.3%, respectively. The effective tax rate represents a blend of federal and state taxes and includes the impact of certain nondeductible or nontaxable items. The increase for the three and nine months ended September 30, 2022 effective tax rate is primarily due to the non-taxable adjustment to the tax receivable liability related to the Tax Receivable Agreement (the "Tax Receivable Agreement" or "TRA"), partially offset by stock compensation benefits. Tax Receivable Agreement In connection with the Company’s IPO, the Company entered into the TRA with our pre-IPO stockholders (the “TRA holders”). The TRA provides for the payment by the Company to the TRA holders of 85% of the amount of cash savings, if any, in U.S. federal, state, local, and foreign income tax that the Company actually realizes (or are deemed to realize in certain circumstances) as a result of certain tax attributes that existed at the time of the IPO (the “Pre-IPO Tax Attributes”). The Company will retain the benefit of the remaining 15% of these cash savings. Upon the closing of the IPO in the first quarter of 2021, the Company recognized a non-current liability of $115,200, which represented undiscounted aggregate payments that were expected to be paid to the TRA holders under the TRA, with an offset to Stockholders’ Equity. The TRA balance as of September 30, 2022 and December 31, 2021 was $103,800 and $98,800, respectively. The TRA liability is an estimate and actual amounts payable under the Tax Receivable Agreement could differ from this estimate. During the nine months ended September 30, 2022, the Company recorded an adjustment to the estimated TRA liability of $5,000. Adjustments to the TRA are recorded in Other, net Non-Operating Income (Expense) on the Company’s Condensed Consolidated Statements of Operations. For more information on the TRA, see Note 13 of the Notes to the Consolidated Financial Statements in Part II, Item 8, “Financial Statements” in the 2021 10-K. |
SPECIAL ITEMS, NET
SPECIAL ITEMS, NET | 9 Months Ended |
Sep. 30, 2022 | |
Unusual or Infrequent Items, or Both [Abstract] | |
SPECIAL ITEMS, NET | SPECIAL ITEMS, NET Special Items, net reflects expenses, or credits to expense, that are not representative of our ongoing costs for the periods presented and may vary from period to period in nature, frequency, and amount. Special Items, net on the Condensed Consolidated Statements of Operations consist of the following: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 CARES Act grant recognition (see Note 3 ) $ — $ — $ — $ (71,587) CARES Act employee retention credit (See Note 3 ) — (68) — (848) Other — 3 — 16 Total Special Items, net $ — $ (65) $ — $ (72,419) |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES The Company has contractual obligations and commitments primarily with regard to lease arrangements, repayment of debt (see Note 7 ), payments under the TRA (see Note 11 ), and probable future purchases of aircraft. During the second quarter of 2022, an owned aircraft was retired due to the aircraft sustaining damage beyond economic repair. The best estimate of this event was recorded as of the second quarter and had no financial impact on the Company's Condensed Consolidated Statement of Operations. The estimate will be revised when additional information becomes available or when the contingency is finalized. The Company does not believe the finalization of the contingency will have a material effect on the Company's Condensed Consolidated Results of Operations. During the nine months ended September 30, 2022, the Company executed an agreement to purchase a flight simulator at a total purchase price of $9,745. To date, $8,781 has been remitted to the seller. The remaining purchase price will be remitted to the seller upon receipt and installation of the simulator. Payments for the simulator are accounted for within Property & Equipment on the Condensed Consolidated Balance Sheets as of September 30, 2022. The Company is subject to various legal proceedings in the normal course of business and expenses legal costs as incurred. Management does not believe these proceedings will have a materially adverse effect on the Company. |
OPERATING SEGMENTS
OPERATING SEGMENTS | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
OPERATING SEGMENTS | OPERATING SEGMENTS The following tables present financial information for the Company’s two operating segments: Passenger and Cargo. For more information on the Company’s segments, see Note 17 of the Notes to the Consolidated Financial Statements in Part II, Item 8, “Financial Statements” in the 2021 10-K. Three Months Ended September 30, 2022 Three Months Ended September 30, 2021 Passenger Cargo Consolidated Passenger Cargo Consolidated Operating Revenues $ 198,013 $ 23,687 $ 221,700 $ 149,263 $ 24,400 $ 173,663 Non-Fuel Operating Expenses 117,788 23,678 141,466 99,960 15,800 115,760 Aircraft Fuel 64,763 80 64,843 36,556 91 36,647 Special Items, net — — — (65) — (65) Total Operating Expenses 182,551 23,758 206,309 136,451 15,891 152,342 Operating Income (Loss) $ 15,462 $ (71) 15,391 $ 12,812 $ 8,509 21,321 Interest Income 1,610 28 Interest Expense (7,493) (6,286) Other, net 3,422 456 Income Before Income Tax $ 12,930 $ 15,519 Nine Months Ended September 30, 2022 Nine Months Ended September 30, 2021 Passenger Cargo Consolidated Passenger Cargo Consolidated Operating Revenues $ 601,360 $ 65,930 $ 667,290 $ 382,380 $ 68,084 $ 450,464 Non-Fuel Operating Expenses 355,894 64,470 420,364 280,272 50,272 330,544 Aircraft Fuel 206,254 80 206,334 90,468 163 90,631 Special Items, net — — — (54,018) (18,401) (72,419) Total Operating Expenses 562,148 64,550 626,698 316,722 32,034 348,756 Operating Income $ 39,212 $ 1,380 40,592 $ 65,658 $ 36,050 101,708 Interest Income 2,166 52 Interest Expense (23,097) (19,487) Other, net (5,156) 18,505 Income Before Income Tax $ 14,505 $ 100,778 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTSThe Company evaluated subsequent events for the period from the Balance Sheet date through November 2, 2022, the date that the Condensed Consolidated Financial Statements were available to be issued.On October 31, 2022, the Company’s Board of Directors authorized a stock repurchase program pursuant to which the Company may purchase up to $50,000 of its Common Stock, $0.01 par value per share (“Common Stock”). The Company may purchase shares of its Common Stock on a discretionary basis from time-to-time through open market repurchases, privately negotiated transactions, accelerated share repurchase, or other means, including through Rule 10b5-1 trading plans. Whether any repurchases are made, and the timing and actual number of any shares repurchased, will be determined by management depending on a variety of factors, including stock price, trading volume, market conditions and other general business considerations. The stock repurchase program has no expiration date and may be modified, suspended, or terminated at any time. Any repurchases made under this program will be funded from the Company’s existing cash flows, or future cash flows. |
BASIS OF PRESENTATION (Policies
BASIS OF PRESENTATION (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | The Company has prepared the Condensed Consolidated Financial Statements according to U.S. Generally Accepted Accounting Principles (“GAAP”) and has included the accounts of Sun Country Airlines Holdings, Inc. and its subsidiaries. The accompanying unaudited Condensed Consolidated Financial Statements of Sun Country Airlines Holdings, Inc. should be read in conjunction with the Consolidated Financial Statements contained in the 2021 10-K. Management believes that all adjustments necessary for the fair presentation of results, consisting of normally recurring items, have been included in the unaudited Condensed Consolidated Financial Statements for the interim periods presented. The Company reclassified certain prior period amounts to conform to the current period presentation. All material intercompany balances and transactions have been eliminated in consolidation. |
Estimates and Assumptions | The preparation of financial statements in accordance with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates. Significant areas of judgment relate to passenger revenue recognition, maintenance under the built-in overhaul method, equity-based compensation, tax receivable agreement, lease accounting, impairment of goodwill, impairment of long-lived and intangible assets, air traffic liabilities, the loyalty program, as well as the valuation of Amazon warrants. |
Investments | Investments Investments consist of debt securities and Certificates of Deposit. The Certificates of Deposit are recorded at cost, plus accrued interest. These certificates serve as collateral for letters of credit required by various airports and other vendors. All of the certificates have original maturities greater than 90 days. During the nine months ended September 30, 2022, the Company purchased debt securities with original maturities of three months or greater. The investments are classified as Current Assets on the Condensed Consolidated Balance Sheets because the securities are highly liquid and are available to be quickly converted into known amounts of cash to fund current operations. Most of the Company's Available-for-Sale securities will mature within one year. The Company limits its exposure to any one issuer or market sector, and largely limits its investments to investment grade quality securities. The Company's investment securities are classified as Available-for-Sale and are reported at fair value on the Company's Condensed Consolidated Balance Sheets. Unrealized gains and losses on the Company's Available-for-Sale securities are excluded from net earnings and are reported as a component of Accumulated Other Comprehensive Income, net of income tax effects, within Stockholders' Equity on the Condensed Consolidated Balance Sheets until realized. Realized gains and losses are recorded using the specific identification method and reflected in Other, net within Non-operating Income (Expense) on the Company's Condensed Consolidated Statement of Operations. Premiums and discounts recorded on Available-for-Sale debt securities are accounted for in Interest Income within Non-operating Income (Expense) on the Company's Condensed Consolidated Statement of Operations. At each reporting period, the Company assesses its Available-for-Sale investments in an unrealized loss position to determine whether an impairment exists. The Company will record an impairment if management intends to sell an impaired security, will likely be required to sell a security before recovery of the entire amortized cost, or the same level of collectible cash flows from the security is no longer expected. The |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards In May 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2021-04, Earnings Per Share (Topic 260), Debt—Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options. This new standard provides clarification and reduces diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (such as warrants) that remain equity classified after modification or exchange. On January 1, 2022, the Company adopted ASU 2021-04 on a prospective basis, as required by the Standard. There was no financial statement impact upon adoption. In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832), Disclosures by Business Entities about Government Assistance . The new standard requires additional disclosures regarding government grants and money contributions. The standard requires disclosures on the nature of the transactions and related accounting policies, including significant terms and conditions, as well as the amounts and specific financial statement line items affected by the transactions. The Company adopted this standard as of January 1, 2022. See Note 3 for additional information on COVID-19 related government assistance the Company has received. |
BASIS OF PRESENTATION (Tables)
BASIS OF PRESENTATION (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Schedule of Error Corrections and Prior Period Adjustments | The impact of the revision on the Company's previously issued Consolidated Balance Sheets as of December 31, 2021 are as follows: December 31, 2021 As Previously Issued Correction As Revised Assets Aircraft and Flight Equipment $ 440,356 $ 6,963 $ 447,319 Total Property & Equipment 688,624 6,963 695,587 Accumulated Depreciation & Amortization (115,013) (2,056) (117,069) Total Property & Equipment, net 573,611 4,907 578,518 Deferred Tax Asset 18,737 (1,129) 17,608 Total Other Assets 427,590 (1,129) 426,461 Total Assets 1,376,644 3,778 1,380,422 Stockholder's Equity Retained Earnings 594 3,778 4,372 Total Stockholders' Equity 486,811 3,778 490,589 Total Liabilities and Stockholders' Equity 1,376,644 3,778 1,380,422 The impact of the revision on the Company's previously issued Condensed Consolidated Statements of Operations for the three and nine-month periods ended September 30, 2021 are as follows: Three Months Ended September 30, 2021 Nine Months Ended September 30, 2021 As Previously Issued Correction As Revised As Previously Issued Correction As Revised Operating Expenses Depreciation and Amortization $ 14,029 $ 681 $ 14,710 $ 40,103 $ 1,429 $ 41,532 Special Items, net (65) — (65) (65,456) (6,963) (72,419) Total Operating Expenses 151,661 681 152,342 354,290 (5,534) 348,756 Operating Income 22,002 (681) 21,321 96,174 5,534 101,708 Income Before Income Tax 16,200 (681) 15,519 95,244 5,534 100,778 Income Tax Expense 2,297 (157) 2,140 17,172 1,272 18,444 Net Income 13,903 (524) 13,379 78,072 4,262 82,334 Basic Income per share $ 0.24 $ (0.01) $ 0.23 $ 1.44 $ 0.07 $ 1.51 Diluted Income per share $ 0.23 $ (0.01) $ 0.22 $ 1.33 $ 0.07 $ 1.40 The revision also impacted the Company's previously issued Condensed Consolidated Statements of Changes in Stockholders Equity as follows: For the Three Months Ended June 30, 2021 For the Three Months Ended March 31, 2021 As Previously Issued Correction As Revised As Previously Issued Correction As Revised Net Income $ 51,753 $ 424 $ 52,177 $ 12,416 $ 4,362 $ 16,778 As of March 31, 2022 As of September 30, 2021 As Previously Issued Correction As Revised As Previously Issued Correction As Revised Retained Earnings $ 4,231 $ 3,778 $ 8,009 $ 1,196 $ 4,262 $ 5,458 Total Stockholders' Equity 493,291 3,778 497,069 482,880 4,262 487,142 As of June 30, 2021 As of March 31, 2021 As Previously Issued Correction As Revised As Previously Issued Correction As Revised Retained Earnings (Deficit) $ (12,707) $ 4,786 $ (7,921) $ (64,460) $ 4,362 $ (60,098) Total Stockholders' Equity 464,233 4,786 469,019 409,960 4,362 414,322 The Company's Condensed Consolidated Statement of Changes Stockholders' Equity as of December 31, 2021 has been corrected to reflect the changes to the impacted Stockholders' Equity accounts as described above. The impact of the revision on the Company's previously issued Condensed Consolidated Statements of Cash Flow for the nine months ended September 30, 2021 is as follows: Nine Months Ended September 30, 2021 As Previously Issued Correction As Revised Operating Activities Net Income $ 78,072 $ 4,262 $ 82,334 Depreciation and Amortization 40,103 1,429 41,532 Non-Cash (Gain) Loss on Asset Transaction, Net (12,666) 12,668 2 Deferred Income Taxes 17,068 1,272 18,340 Operating Lease Obligations (19,983) (12,668) (32,651) Net Cash Provided by Operating Activities 109,395 6,963 116,358 Investing Activities Purchases of Property & Equipment (111,053) (6,963) (118,016) Net Cash Used in Investing Activities (111,427) (6,963) (118,390) |
REVENUE (Tables)
REVENUE (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of significant categories comprising operating revenues | The significant categories comprising Operating Revenues are as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Scheduled Service $ 102,200 $ 80,212 $ 334,679 $ 201,905 Charter Service 42,899 33,809 118,526 88,511 Ancillary 50,261 33,697 139,548 86,626 Passenger 195,360 147,718 592,753 377,042 Cargo 23,687 24,400 65,930 68,084 Other 2,653 1,545 8,607 5,338 Total Operating Revenue $ 221,700 $ 173,663 $ 667,290 $ 450,464 |
Schedule of operating revenues by geographic region | Total Operating Revenues by geographic region are as follows: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Domestic $ 214,904 $ 167,660 $ 634,963 $ 429,508 Latin America 6,756 5,447 32,182 19,870 Other 40 556 145 1,086 Total Operating Revenue $ 221,700 $ 173,663 $ 667,290 $ 450,464 |
Summary of contract assets and liabilities | Contract Assets and Liabilities are as follows: September 30, 2022 December 31, 2021 Contract Assets Costs to fulfill contract with Amazon $ 2,350 $ 2,819 Air Traffic Liabilities 132,830 118,562 Loyalty Program Liabilities 16,317 19,718 Amazon Deferred Up-front Payment 3,501 4,200 Total Contract Liabilities $ 152,648 $ 142,480 |
Schedule of change in contract with customer, liability | Changes in the Loyalty Program Liabilities are as follows: 2022 2021 Balance – January 1 $ 19,718 $ 22,069 Loyalty Points Earned 5,125 3,058 Loyalty Points Redeemed (1) (8,526) (4,816) Balance – September 30 $ 16,317 $ 20,311 ______________________ (1) Loyalty points are combined in one homogenous pool, that includes both air and non-air travel awards, and are not separately identifiable. As such, the revenue recognized is comprised of points that were part of the Loyalty Program Liabilities balance at the beginning of the period, as well as points that were earned during the period. |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Summary of computation of basic and diluted earnings per share | The following table shows the computation of basic and diluted earnings per share: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Numerator: Net Income $ 10,677 $ 13,379 $ 10,392 $ 82,334 Denominator: Weighted Average Common Shares Outstanding - Basic 58,146,606 57,355,104 58,039,201 54,368,231 Dilutive effect of Stock Options, RSUs and Warrants (1) 2,646,910 4,357,274 3,333,534 4,331,760 Weighted Average Common Shares Outstanding - Diluted 60,793,516 61,712,378 61,372,735 58,699,991 Basic earnings per share $ 0.18 $ 0.23 $ 0.18 $ 1.51 Diluted earnings per share $ 0.18 $ 0.22 $ 0.17 $ 1.40 ______________________ (1) There were 3,221,617 and 3,626,851 performance-based stock options outstanding at September 30, 2022 and 2021, respectively. As of September 30, 2022 and 2021, the Company expected approximately 63% and 75% of these options to vest, respectively. As of September 30, 2022, 32.5% of the eligible outstanding performance-based stock options vested and were considered exercisable. These amounts are included in the measure above to the extent they are dilutive. |
AIRCRAFT (Tables)
AIRCRAFT (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Summary of aircraft fleet activity | The following tables summarize the Company’s aircraft fleet activity for the nine months ended September 30, 2022 and 2021, respectively: December 31, 2021 Additions Reclassifications Removals September 30, 2022 Passenger: Owned 21 5 4 (1) 29 Finance leases (1) 9 2 — — 11 Operating leases 6 — (4) — 2 Sun Country Airlines’ Fleet 36 7 — (1) 42 Cargo: Aircraft Operated for Amazon 12 — — — 12 Total Aircraft Operated 48 7 — (1) 54 December 31, 2020 Additions Reclassifications Removals September 30, 2021 Passenger: Owned 14 1 6 — 21 Finance leases 5 3 — — 8 Operating leases 12 — (6) — 6 Sun Country Airlines’ Fleet 31 4 — — 35 Cargo: Aircraft Operated for Amazon 12 — — — 12 Total Aircraft Operated 43 4 — — 47 (1) Two aircraft operating leases were reclassified into finance lease and two separate aircraft finance lease purchase options were exercised, resulting in a net change of zero finance lease reclassifications. |
Schedule of depreciation, amortization, and rent expense on aircraft | Depreciation, amortization, and rent expense on aircraft are as follows: Three Months Ended September 30, Nine Months Ended September 30, Aircraft Status Expense Type 2022 2021 2022 2021 Owned Depreciation $ 10,179 $ 9,284 $ 29,027 $ 26,514 Finance Leased Amortization 4,419 2,977 12,533 7,846 Operating Leased Aircraft Rent (1) 1,949 3,925 7,347 13,339 $ 16,547 $ 16,186 $ 48,907 $ 47,699 (1) Aircraft Rent expense includes credits for the amortization of over-market liabilities established at the Acquisition Date. |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Summary of long term debt | Long-term Debt includes the following: September 30, 2022 December 31, 2021 Notes payable under the Company's 2019-1 EETC agreement dated December 2019, with original loan amounts of $248,587 payable in bi-annual installments, in June and December, through December 2027. These notes bear interest at an annual rate between 4.13% and 6.95% and the weighted average interest rate is 4.73% as of September 30, 2022. $ 194,884 $ 202,984 Notes payable under the Company's 2022-1 EETC agreement dated March 2022, with a face amount of $188,277 payable in bi-annual installments, in March and September, through March 2031. These notes bear interest at an annual rate between 4.84% and 5.75% and the weighted average interest rate is 5.06% as of September 30, 2022. 179,019 — Delayed Draw Term Loan Facility — 77,481 Other Notes payable — 466 Total Debt 373,903 280,931 Less: Unamortized debt issuance costs (3,706) (3,505) Less: Current Maturities of Long-term Debt (45,535) (29,412) Total Long-term Debt $ 324,662 $ 248,014 |
Schedule of future maturities of the outstanding debt | Future maturities of the outstanding Debt are as follows: Debt Principal Amortization of Debt Net Debt Remainder of 2022 $ 18,187 $ (264) $ 17,923 2023 58,518 (962) 57,556 2024 60,157 (777) 59,380 2025 65,241 (602) 64,639 2026 45,668 (415) 45,253 Thereafter 126,132 (686) 125,446 Total as of September 30, 2022 $ 373,903 $ (3,706) $ 370,197 |
FUEL DERIVATIVES AND RISK MAN_2
FUEL DERIVATIVES AND RISK MANAGEMENT (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of changes in derivative assets (liabilities) | Changes in Derivative Assets (Liabilities) are as follows: Nine Months Ended September 30, 2022 2021 Balance - January 1 $ — $ (1,174) Non-cash Gains — 3,527 Contract Settlements — (2,105) Balance - September 30 $ — $ 248 |
Schedule of fuel derivative gains (losses) | Fuel Derivative Gains (Losses) consist of the following: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 Total Fuel Derivative Gains (Losses) $ — $ (72) $ — $ 3,527 |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of debt securities by major security type | A summary of debt securities by major security type: September 30, 2022 (1) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-Sale Securities (2) : Municipal Debt Securities $ 41,108 $ — $ (331) $ 40,777 Corporate Debt Securities 83,547 — (695) 82,852 U.S. Government Agency Securities 5,005 — (65) 4,940 Total $ 129,660 $ — $ (1,091) $ 128,569 (1) As the Company began purchasing these investment securities during the second quarter of 2022, there is no comparable prior period information. (2) The Company also holds Certificates of Deposit that are included in Investments on the Condensed Consolidated Balance Sheets totaling $6,601 and $6,283 as of September 30, 2022 and December 31, 2021, respectively. |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Summary of assets and liabilities measured at fair value on a recurring basis | The following table summarizes the assets measured at fair value on a recurring basis: September 30, 2022 Level 1 Level 2 Level 3 Total Cash & Cash Equivalents $ 70,925 $ 60,987 $ — $ 131,912 Available-for-Sale Securities: Municipal Debt Securities — 40,777 — 40,777 Corporate Debt Securities — 82,852 — 82,852 U.S. Government Agency Securities — 4,940 — 4,940 Total Available-for-Sale Securities — 128,569 — 128,569 Total Assets Measured at Fair Value on a Recurring Basis $ 70,925 $ 189,556 $ — $ 260,481 December 31, 2021 Level 1 Level 2 Level 3 Total Cash & Cash Equivalents $ 309,338 $ — $ — $ 309,338 Total Assets Measured at Fair Value on a Recurring Basis $ 309,338 $ — $ — $ 309,338 |
SPECIAL ITEMS, NET (Tables)
SPECIAL ITEMS, NET (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Unusual or Infrequent Items, or Both [Abstract] | |
Schedule of special items, net | Special Items, net on the Condensed Consolidated Statements of Operations consist of the following: Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 CARES Act grant recognition (see Note 3 ) $ — $ — $ — $ (71,587) CARES Act employee retention credit (See Note 3 ) — (68) — (848) Other — 3 — 16 Total Special Items, net $ — $ (65) $ — $ (72,419) |
OPERATING SEGMENTS (Tables)
OPERATING SEGMENTS (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Summary of financial information for the operating segments | The following tables present financial information for the Company’s two operating segments: Passenger and Cargo. For more information on the Company’s segments, see Note 17 of the Notes to the Consolidated Financial Statements in Part II, Item 8, “Financial Statements” in the 2021 10-K. Three Months Ended September 30, 2022 Three Months Ended September 30, 2021 Passenger Cargo Consolidated Passenger Cargo Consolidated Operating Revenues $ 198,013 $ 23,687 $ 221,700 $ 149,263 $ 24,400 $ 173,663 Non-Fuel Operating Expenses 117,788 23,678 141,466 99,960 15,800 115,760 Aircraft Fuel 64,763 80 64,843 36,556 91 36,647 Special Items, net — — — (65) — (65) Total Operating Expenses 182,551 23,758 206,309 136,451 15,891 152,342 Operating Income (Loss) $ 15,462 $ (71) 15,391 $ 12,812 $ 8,509 21,321 Interest Income 1,610 28 Interest Expense (7,493) (6,286) Other, net 3,422 456 Income Before Income Tax $ 12,930 $ 15,519 Nine Months Ended September 30, 2022 Nine Months Ended September 30, 2021 Passenger Cargo Consolidated Passenger Cargo Consolidated Operating Revenues $ 601,360 $ 65,930 $ 667,290 $ 382,380 $ 68,084 $ 450,464 Non-Fuel Operating Expenses 355,894 64,470 420,364 280,272 50,272 330,544 Aircraft Fuel 206,254 80 206,334 90,468 163 90,631 Special Items, net — — — (54,018) (18,401) (72,419) Total Operating Expenses 562,148 64,550 626,698 316,722 32,034 348,756 Operating Income $ 39,212 $ 1,380 40,592 $ 65,658 $ 36,050 101,708 Interest Income 2,166 52 Interest Expense (23,097) (19,487) Other, net (5,156) 18,505 Income Before Income Tax $ 14,505 $ 100,778 |
COMPANY BACKGROUND - Offerings
COMPANY BACKGROUND - Offerings (Details) - USD ($) | 1 Months Ended | 6 Months Ended | 9 Months Ended | |||||
Mar. 19, 2021 | Mar. 17, 2021 | Mar. 16, 2021 | Oct. 31, 2021 | May 31, 2021 | Oct. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Subsidiary, Sale of Stock [Line Items] | ||||||||
Proceeds from issuance of common stock | $ 0 | |||||||
Offering expenses | $ 1,763,000 | $ 0 | $ 8,706,000 | |||||
Apollo Stockholder | ||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||
Shares issued (in shares) | 8,500,000 | 7,250,000 | ||||||
Share price (in dollars per share) | $ 32.50 | $ 34.50 | $ 32.50 | |||||
IPO | ||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||
Shares issued (in shares) | 10,454,545 | 9,090,909 | ||||||
Share price (in dollars per share) | $ 24 | |||||||
Proceeds from issuance of common stock | $ 225,329,000 | |||||||
Underwriters option | ||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||
Shares issued (in shares) | 1,363,636 | 435,291 | 1,087,500 | |||||
Private placement | Apollo Stockholder | PAR Investment Partners, L.P | ||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||
Shares issued (in shares) | 2,216,312 | |||||||
Aggregate purchase price | $ 50,000,000 | |||||||
Share price percentage of IPO share price | 94% | |||||||
Private placement | Apollo Stockholder | Certain funds or accounts managed by an investment adviser subsidiary of Blackrock, Inc | ||||||||
Subsidiary, Sale of Stock [Line Items] | ||||||||
Shares issued (in shares) | 2,216,308 | |||||||
Aggregate purchase price | $ 50,000,000 | |||||||
Share price percentage of IPO share price | 94% |
COMPANY BACKGROUND - Amazon Agr
COMPANY BACKGROUND - Amazon Agreement (Details) - Amazon Agreement $ / shares in Units, $ in Thousands | 9 Months Ended | ||
Dec. 13, 2019 USD ($) item $ / shares shares | Sep. 30, 2022 shares | Sep. 30, 2021 shares | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Term of agreement | 6 years | ||
Number of extension option | item | 2 | ||
Term of renewal of agreement | 2 years | ||
Threshold term of agreement | 10 years | ||
Warrants issued (in shares) | 9,482,606 | ||
Exercise price (in dollars per share) | $ / shares | $ 15.17 | ||
Warrants vested (in shares) | 632,183 | 568,956 | 568,956 |
Number of warrants that vest on achievement of each milestone (in shares) | 63,217 | ||
Milestone achievement for warrants to vest | $ | $ 8,000 | ||
Cumulative warrants vested (in shares) | 2,212,615 | 1,454,008 |
BASIS OF PRESENTATION -Revision
BASIS OF PRESENTATION -Revision of Previously Issued Consolidated Financial Statements (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
Balance Sheet Related Disclosures [Abstract] | ||||||||||
Total Property & Equipment | $ 948,638 | $ 948,638 | $ 695,587 | |||||||
Total Property & Equipment, net | 788,859 | 788,859 | 578,518 | |||||||
Deferred Tax Asset | 14,734 | 14,734 | 17,608 | |||||||
Total Other Assets | 426,461 | |||||||||
Total Assets | 1,521,444 | 1,521,444 | 1,380,422 | |||||||
Retained Earnings | 14,764 | 14,764 | 4,372 | |||||||
Retained Earnings | 508,005 | $ 495,888 | $ 497,069 | $ 487,142 | $ 469,019 | $ 414,322 | 508,005 | $ 487,142 | 490,589 | $ 283,817 |
Total Liabilities and Stockholders' Equity | 1,521,444 | 1,521,444 | 1,380,422 | |||||||
Operating Expenses | ||||||||||
Depreciation and Amortization | 17,181 | 14,710 | 49,364 | 41,532 | ||||||
Special Items, net | 0 | (65) | 0 | (72,419) | ||||||
Total Operating Expenses | 152,342 | 348,756 | ||||||||
Operating Income | 15,391 | 21,321 | 40,592 | 101,708 | ||||||
Income Before Income Tax | 12,930 | 15,519 | 14,505 | 100,778 | ||||||
Income Tax Expense | 2,253 | 2,140 | 4,113 | 18,444 | ||||||
Net Income (Loss) | $ 10,677 | (3,922) | 3,637 | $ 13,379 | 52,177 | 16,778 | $ 10,392 | $ 82,334 | ||
Basic (in dollars per share) | $ 0.18 | $ 0.23 | $ 0.18 | $ 1.51 | ||||||
Diluted (in dollars per share) | $ 0.18 | $ 0.22 | $ 0.17 | $ 1.40 | ||||||
Stockholder's Equity | ||||||||||
Net Income (Loss) | $ 10,677 | (3,922) | 3,637 | $ 13,379 | 52,177 | 16,778 | $ 10,392 | $ 82,334 | ||
Total Stockholders' Equity | 508,005 | 495,888 | 497,069 | 487,142 | 469,019 | 414,322 | 508,005 | 487,142 | 490,589 | 283,817 |
Statement of Cash Flows [Abstract] | ||||||||||
Net Income (Loss) | 10,677 | (3,922) | 3,637 | 13,379 | 52,177 | 16,778 | 10,392 | 82,334 | ||
Depreciation and Amortization | 17,181 | 14,710 | 49,364 | 41,532 | ||||||
Non-Cash (Gain) Loss on Asset Transaction, Net | (318) | 2 | ||||||||
Deferred Income Taxes | 3,183 | 18,340 | ||||||||
Operating Lease Obligations | (61) | (32,651) | ||||||||
Net Cash Provided by Operating Activities | 71,671 | 116,358 | ||||||||
Purchases of Property & Equipment | (177,658) | (118,016) | ||||||||
Net Cash Used in Investing Activities | (297,610) | (118,390) | ||||||||
Retained Earnings (Deficit) | ||||||||||
Balance Sheet Related Disclosures [Abstract] | ||||||||||
Retained Earnings | 14,764 | 4,087 | 8,009 | 5,458 | (7,921) | (60,098) | 14,764 | 5,458 | 4,372 | 38,324 |
Operating Expenses | ||||||||||
Net Income (Loss) | 10,677 | (3,922) | 3,637 | 13,379 | 52,177 | 16,778 | ||||
Stockholder's Equity | ||||||||||
Net Income (Loss) | 10,677 | (3,922) | 3,637 | 13,379 | 52,177 | 16,778 | ||||
Total Stockholders' Equity | 14,764 | 4,087 | 8,009 | 5,458 | (7,921) | (60,098) | 14,764 | 5,458 | 4,372 | $ 38,324 |
Statement of Cash Flows [Abstract] | ||||||||||
Net Income (Loss) | 10,677 | $ (3,922) | 3,637 | 13,379 | 52,177 | 16,778 | ||||
Previously Reported | ||||||||||
Balance Sheet Related Disclosures [Abstract] | ||||||||||
Total Property & Equipment | 688,624 | |||||||||
Accumulated Depreciation & Amortization | (115,013) | |||||||||
Total Property & Equipment, net | 573,611 | |||||||||
Deferred Tax Asset | 18,737 | |||||||||
Total Other Assets | 427,590 | |||||||||
Total Assets | 1,376,644 | |||||||||
Retained Earnings | 594 | |||||||||
Retained Earnings | 493,291 | 482,880 | 464,233 | 409,960 | 482,880 | 486,811 | ||||
Total Liabilities and Stockholders' Equity | 1,376,644 | |||||||||
Operating Expenses | ||||||||||
Depreciation and Amortization | 14,029 | 40,103 | ||||||||
Special Items, net | (65) | (65,456) | ||||||||
Total Operating Expenses | 151,661 | 354,290 | ||||||||
Operating Income | 22,002 | 96,174 | ||||||||
Income Before Income Tax | 16,200 | 95,244 | ||||||||
Income Tax Expense | 2,297 | 17,172 | ||||||||
Net Income (Loss) | $ 13,903 | 51,753 | 12,416 | $ 78,072 | ||||||
Basic (in dollars per share) | $ 0.24 | $ 1.44 | ||||||||
Diluted (in dollars per share) | $ 0.23 | $ 1.33 | ||||||||
Stockholder's Equity | ||||||||||
Net Income (Loss) | $ 13,903 | 51,753 | 12,416 | $ 78,072 | ||||||
Total Stockholders' Equity | 493,291 | 482,880 | 464,233 | 409,960 | 482,880 | 486,811 | ||||
Statement of Cash Flows [Abstract] | ||||||||||
Net Income (Loss) | 13,903 | 51,753 | 12,416 | 78,072 | ||||||
Depreciation and Amortization | 14,029 | 40,103 | ||||||||
Non-Cash (Gain) Loss on Asset Transaction, Net | (12,666) | |||||||||
Deferred Income Taxes | 17,068 | |||||||||
Operating Lease Obligations | (19,983) | |||||||||
Net Cash Provided by Operating Activities | 109,395 | |||||||||
Purchases of Property & Equipment | (111,053) | |||||||||
Net Cash Used in Investing Activities | (111,427) | |||||||||
Previously Reported | Retained Earnings (Deficit) | ||||||||||
Balance Sheet Related Disclosures [Abstract] | ||||||||||
Retained Earnings | 4,231 | 1,196 | (12,707) | (64,460) | 1,196 | |||||
Stockholder's Equity | ||||||||||
Total Stockholders' Equity | 4,231 | 1,196 | (12,707) | (64,460) | 1,196 | |||||
Revision of Prior Period, Error Correction, Adjustment | ||||||||||
Balance Sheet Related Disclosures [Abstract] | ||||||||||
Total Property & Equipment | 6,963 | |||||||||
Accumulated Depreciation & Amortization | (2,056) | |||||||||
Total Property & Equipment, net | 4,907 | |||||||||
Deferred Tax Asset | (1,129) | |||||||||
Total Other Assets | (1,129) | |||||||||
Total Assets | 3,778 | |||||||||
Retained Earnings | 3,778 | |||||||||
Retained Earnings | 3,778 | 4,262 | 4,786 | 4,362 | 4,262 | 3,778 | ||||
Total Liabilities and Stockholders' Equity | 3,778 | |||||||||
Operating Expenses | ||||||||||
Depreciation and Amortization | 681 | 1,429 | ||||||||
Special Items, net | 0 | (6,963) | ||||||||
Total Operating Expenses | 681 | (5,534) | ||||||||
Operating Income | (681) | 5,534 | ||||||||
Income Before Income Tax | (681) | 5,534 | ||||||||
Income Tax Expense | (157) | 1,272 | ||||||||
Net Income (Loss) | $ (524) | 424 | 4,362 | $ 4,262 | ||||||
Basic (in dollars per share) | $ (0.01) | $ 0.07 | ||||||||
Diluted (in dollars per share) | $ (0.01) | $ 0.07 | ||||||||
Stockholder's Equity | ||||||||||
Net Income (Loss) | $ (524) | 424 | 4,362 | $ 4,262 | ||||||
Total Stockholders' Equity | 3,778 | 4,262 | 4,786 | 4,362 | 4,262 | 3,778 | ||||
Statement of Cash Flows [Abstract] | ||||||||||
Net Income (Loss) | (524) | 424 | 4,362 | 4,262 | ||||||
Depreciation and Amortization | 681 | 1,429 | ||||||||
Non-Cash (Gain) Loss on Asset Transaction, Net | 12,668 | |||||||||
Deferred Income Taxes | 1,272 | |||||||||
Operating Lease Obligations | (12,668) | |||||||||
Net Cash Provided by Operating Activities | 6,963 | |||||||||
Purchases of Property & Equipment | (6,963) | |||||||||
Net Cash Used in Investing Activities | (6,963) | |||||||||
Revision of Prior Period, Error Correction, Adjustment | Retained Earnings (Deficit) | ||||||||||
Balance Sheet Related Disclosures [Abstract] | ||||||||||
Retained Earnings | 3,778 | 4,262 | 4,786 | 4,362 | 4,262 | |||||
Stockholder's Equity | ||||||||||
Total Stockholders' Equity | $ 3,778 | $ 4,262 | $ 4,786 | $ 4,362 | $ 4,262 | |||||
Aircraft and Flight Equipment | ||||||||||
Balance Sheet Related Disclosures [Abstract] | ||||||||||
Aircraft and Flight Equipment | $ 628,375 | $ 628,375 | 447,319 | |||||||
Aircraft and Flight Equipment | Previously Reported | ||||||||||
Balance Sheet Related Disclosures [Abstract] | ||||||||||
Aircraft and Flight Equipment | 440,356 | |||||||||
Aircraft and Flight Equipment | Revision of Prior Period, Error Correction, Adjustment | ||||||||||
Balance Sheet Related Disclosures [Abstract] | ||||||||||
Aircraft and Flight Equipment | $ 6,963 |
IMPACT OF THE COVID-19 PANDEM_2
IMPACT OF THE COVID-19 PANDEMIC (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
IMPACT OF THE COVID19 PANDEMIC | ||||
Grants recognized | $ 0 | $ 0 | $ 0 | $ 71,587 |
CARES Act employee retention credit | $ 0 | $ 68 | $ 0 | 848 |
U. S. Department of the Treasury CARES Act Loan | ||||
IMPACT OF THE COVID19 PANDEMIC | ||||
Loan received | 45,000 | |||
PSP2 | ||||
IMPACT OF THE COVID19 PANDEMIC | ||||
Grants recognized | $ 71,587 |
REVENUE - Significant Categorie
REVENUE - Significant Categories of Operating Revenues (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
REVENUE | ||||
Total Operating Revenue | $ 221,700 | $ 173,663 | $ 667,290 | $ 450,464 |
Passenger | ||||
REVENUE | ||||
Total Operating Revenue | 195,360 | 147,718 | 592,753 | 377,042 |
Scheduled Service | ||||
REVENUE | ||||
Total Operating Revenue | 102,200 | 80,212 | 334,679 | 201,905 |
Charter Service | ||||
REVENUE | ||||
Total Operating Revenue | 42,899 | 33,809 | 118,526 | 88,511 |
Ancillary | ||||
REVENUE | ||||
Total Operating Revenue | 50,261 | 33,697 | 139,548 | 86,626 |
Cargo | ||||
REVENUE | ||||
Total Operating Revenue | 23,687 | 24,400 | 65,930 | 68,084 |
Other | ||||
REVENUE | ||||
Total Operating Revenue | $ 2,653 | $ 1,545 | $ 8,607 | $ 5,338 |
REVENUE - Operating Revenues by
REVENUE - Operating Revenues by Geographic Region (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
REVENUE | ||||
Total Operating Revenue | $ 221,700 | $ 173,663 | $ 667,290 | $ 450,464 |
Domestic | ||||
REVENUE | ||||
Total Operating Revenue | 214,904 | 167,660 | 634,963 | 429,508 |
Latin America | ||||
REVENUE | ||||
Total Operating Revenue | 6,756 | 5,447 | 32,182 | 19,870 |
Other | ||||
REVENUE | ||||
Total Operating Revenue | $ 40 | $ 556 | $ 145 | $ 1,086 |
REVENUE - Contract Balances (De
REVENUE - Contract Balances (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||
Dec. 13, 2019 | Dec. 31, 2019 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Dec. 31, 2020 | |
REVENUE | ||||||||
Maintenance expense | $ 11,018 | $ 9,660 | $ 35,794 | $ 30,170 | ||||
Total Contract Liabilities | 152,648 | $ 152,648 | $ 142,480 | |||||
Amazon Agreement | ||||||||
REVENUE | ||||||||
Warrants vested (in shares) | 632,183 | 568,956 | 568,956 | |||||
Air Traffic Liabilities | ||||||||
REVENUE | ||||||||
Total Contract Liabilities | 132,830 | $ 132,830 | 118,562 | |||||
Loyalty Program Liabilities | ||||||||
REVENUE | ||||||||
Revenue recognized | 8,526 | $ 4,816 | ||||||
Total Contract Liabilities | 16,317 | 20,311 | 16,317 | 20,311 | 19,718 | $ 22,069 | ||
Amazon Deferred Up-front Payment | ||||||||
REVENUE | ||||||||
Proceeds from startup costs | $ 10,300 | |||||||
Fair value of warrants vested | 4,667 | |||||||
Total Contract Liabilities | 3,501 | $ 3,501 | 4,200 | |||||
Amazon Deferred Up-front Payment | Other Liabilities | ||||||||
REVENUE | ||||||||
Fair value of warrants vested | $ 5,633 | |||||||
Costs to fulfill contract with Amazon | ||||||||
REVENUE | ||||||||
Amortization period | 6 years | |||||||
Maintenance expense | 151 | 208 | $ 469 | 515 | ||||
Contract Assets | 2,350 | 2,350 | $ 2,819 | |||||
Cargo | Amazon Deferred Up-front Payment | ||||||||
REVENUE | ||||||||
Revenue recognized | $ 225 | $ 310 | 699 | $ 779 | ||||
Passenger | ||||||||
REVENUE | ||||||||
Revenue recognized | $ 109,852 |
REVENUE - Loyalty Program (Deta
REVENUE - Loyalty Program (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Change in Contract with Customer, Liability [Roll Forward] | ||
Balance – January 1 | $ 142,480 | |
Balance – September 30 | 152,648 | |
Loyalty Program Liabilities | ||
Change in Contract with Customer, Liability [Roll Forward] | ||
Balance – January 1 | 19,718 | $ 22,069 |
Loyalty Points Earned | 5,125 | 3,058 |
Loyalty Points Redeemed | (8,526) | (4,816) |
Balance – September 30 | $ 16,317 | $ 20,311 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Numerator: | ||||||||
Net Income | $ 10,677 | $ (3,922) | $ 3,637 | $ 13,379 | $ 52,177 | $ 16,778 | $ 10,392 | $ 82,334 |
Denominator: | ||||||||
Weighted Average Common Shares Outstanding - Basic (in shares) | 58,146,606 | 57,355,104 | 58,039,201 | 54,368,231 | ||||
Dilutive effect of Stock Options, RSUs and Warrants (in shares) | 2,646,910 | 4,357,274 | 3,333,534 | 4,331,760 | ||||
Weighted Average Common Shares Outstanding - Diluted (in shares) | 60,793,516 | 61,712,378 | 61,372,735 | 58,699,991 | ||||
Basic earnings per share (in dollars per share) | $ 0.18 | $ 0.23 | $ 0.18 | $ 1.51 | ||||
Diluted earnings per share (in dollars per share) | $ 0.18 | $ 0.22 | $ 0.17 | $ 1.40 | ||||
Performance-based stock options | ||||||||
Denominator: | ||||||||
Outstanding shares (in shares) | 3,221,617 | 3,626,851 | 3,221,617 | 3,626,851 | ||||
Percentage of stock options expected to meet performance conditions | 63% | 75% | ||||||
Percentage of stock options vested and exercisable | 32.50% |
AIRCRAFT - Additional Informati
AIRCRAFT - Additional Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2022 USD ($) aircraft | Mar. 31, 2022 USD ($) aircraft | Sep. 30, 2022 USD ($) aircraft | Sep. 30, 2021 aircraft | Dec. 31, 2021 USD ($) aircraft | Dec. 31, 2020 aircraft | |
AIRCRAFT - Owned and Leased | ||||||
Number of aircraft | 54 | 54 | 47 | 48 | 43 | |
Number of aircraft modified to finance leases | 2 | |||||
Amount reclassified to finance lease, right-of-use asset | $ | $ 9,687 | |||||
Over-market maintenance reserve liability reclassified to finance lease liability | $ | $ 6,023 | |||||
Number of aircrafts financed using proceeds from issuance of pass-through trust certificates | 5 | |||||
Number of aircrafts financed using finance lease arrangement | 2 | 3 | ||||
Number of aircraft finance lease purchase options exercised | 2 | |||||
Number of aircrafts previously under operating leases | 2 | 6 | ||||
Additions | 7 | 4 | ||||
Aircraft maintenance deposits contra assets | ||||||
AIRCRAFT - Owned and Leased | ||||||
Remaining unamortized balance contra assets | $ | $ 13,211 | $ 13,211 | $ 22,348 | |||
Contra asset, reduction | $ | 9,137 | |||||
Remaining unamortized balance contra assets, used for purchase of aircraft | $ | 8,362 | |||||
Over-market lease rates | ||||||
AIRCRAFT - Owned and Leased | ||||||
Remaining unamortized balance contra assets | $ | 132 | 132 | 10,363 | |||
Over market liabilities | $ | 2,958 | 2,958 | $ 14,737 | |||
Reduction in over-market maintenance reserve liabilities | $ | $ 11,779 | |||||
Remaining unamortized balance contra assets, used for purchase of aircraft | $ | 173 | |||||
Purchase of aircraft | $ | $ 3,303 | |||||
Boeing 737-800 | ||||||
AIRCRAFT - Owned and Leased | ||||||
Number of aircraft | 53 | 53 | ||||
Boeing 737-700 | ||||||
AIRCRAFT - Owned and Leased | ||||||
Number of aircraft | 1 | 1 | ||||
Passenger | ||||||
AIRCRAFT - Owned and Leased | ||||||
Number of aircraft | 42 | 42 | 35 | 36 | 31 | |
Number of aircraft modified to finance leases | 2 | |||||
Number of aircrafts financed | 26 | 26 | ||||
Number of aircrafts unencumbered | 3 | 3 | 1 | |||
Additions | 7 | 4 |
AIRCRAFT - Aircraft Fleet (Deta
AIRCRAFT - Aircraft Fleet (Details) - aircraft | 3 Months Ended | 9 Months Ended | |
Mar. 31, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | |
Movement in Property, Plant and Equipment [Roll Forward] | |||
Balance at beginning of period | 48 | 48 | 43 |
Additions | 7 | 4 | |
Reclassifications | 0 | 0 | |
Removals | (1) | 0 | |
Balance at end of period | 54 | 47 | |
Number of aircraft modified to finance leases | 2 | ||
Number of aircraft finance lease purchase options exercised | 2 | ||
Reclassifications, net change | 0 | ||
Passenger | |||
Movement in Property, Plant and Equipment [Roll Forward] | |||
Balance at beginning of period | 36 | 36 | 31 |
Additions | 7 | 4 | |
Reclassifications | 0 | 0 | |
Removals | (1) | 0 | |
Balance at end of period | 42 | 35 | |
Number of aircraft modified to finance leases | 2 | ||
Passenger | Owned | |||
Movement in Property, Plant and Equipment [Roll Forward] | |||
Balance at beginning of period | 21 | 21 | 14 |
Additions | 5 | 1 | |
Reclassifications | 4 | 6 | |
Removals | (1) | 0 | |
Balance at end of period | 29 | 21 | |
Passenger | Finance leases | |||
Movement in Property, Plant and Equipment [Roll Forward] | |||
Balance at beginning of period | 9 | 9 | 5 |
Additions | 2 | 3 | |
Reclassifications | 0 | 0 | |
Removals | 0 | 0 | |
Balance at end of period | 11 | 8 | |
Passenger | Operating leases | |||
Movement in Property, Plant and Equipment [Roll Forward] | |||
Balance at beginning of period | 6 | 6 | 12 |
Additions | 0 | 0 | |
Reclassifications | (4) | (6) | |
Removals | 0 | 0 | |
Balance at end of period | 2 | 6 | |
Cargo | Aircraft Operated for Amazon | |||
Movement in Property, Plant and Equipment [Roll Forward] | |||
Balance at beginning of period | 12 | 12 | 12 |
Additions | 0 | 0 | |
Reclassifications | 0 | 0 | |
Removals | 0 | 0 | |
Balance at end of period | 12 | 12 |
AIRCRAFT - Depreciation, Amorti
AIRCRAFT - Depreciation, Amortization, and Rent Expense on Aircraft (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
AIRCRAFT - Owned and Leased | ||||
Aircraft Rent | $ 1,949 | $ 3,925 | $ 7,347 | $ 13,339 |
Depreciation amortization and aircraft rent | 16,547 | 16,186 | 48,907 | 47,699 |
Owned | ||||
AIRCRAFT - Owned and Leased | ||||
Depreciation | 10,179 | 9,284 | 29,027 | 26,514 |
Finance leases | ||||
AIRCRAFT - Owned and Leased | ||||
Amortization | 4,419 | 2,977 | 12,533 | 7,846 |
Operating leases | ||||
AIRCRAFT - Owned and Leased | ||||
Aircraft Rent | $ 1,949 | $ 3,925 | $ 7,347 | $ 13,339 |
DEBT - Lines of Credit (Details
DEBT - Lines of Credit (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Feb. 10, 2021 USD ($) | Sep. 30, 2022 USD ($) aircraft | Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) aircraft | Dec. 31, 2021 USD ($) aircraft | |
DEBT | |||||
Number of aircrafts previously under operating leases | aircraft | 2 | 6 | |||
Loss on Extinguishment of Debt | $ 1,557 | $ 1,224 | |||
Credit Facilities | Line of Credit | |||||
DEBT | |||||
Term of debt | 5 years | ||||
Minimum EBITDAR required to be maintained | $ 87,700 | 87,700 | |||
Minimum liquidity required to be maintained | 30,000 | 30,000 | |||
Revolving Credit Facility | Line of Credit | Revolving Credit Facility | |||||
DEBT | |||||
Maximum borrowing capacity | $ 25,000 | ||||
Line of credit facility, amount available | 24,650 | 24,650 | |||
Delayed Draw Term Loan Facility | |||||
DEBT | |||||
Number of aircrafts previously under operating leases | aircraft | 6 | ||||
Delayed Draw Term Loan Facility | Loans Payable | |||||
DEBT | |||||
Maximum borrowing capacity | 90,000 | ||||
Amount of draw | $ 80,500 | ||||
Current borrowing capacity | $ 0 | $ 0 | |||
Prior revolving credit agreement | Line of Credit | Revolving Credit Facility | |||||
DEBT | |||||
Maximum borrowing capacity | $ 25,000 |
DEBT - Long-term Debt (Details)
DEBT - Long-term Debt (Details) - Notes payable | 1 Months Ended | 9 Months Ended | |
Dec. 31, 2019 USD ($) aircraft | Sep. 30, 2022 USD ($) aircraft | Mar. 31, 2022 USD ($) aircraft | |
Notes payable under the Company's 2019-1 EETC agreement | |||
DEBT | |||
Face amount | $ | $ 248,587,000 | ||
Number of used aircrafts purchased or refinanced | 13 | ||
Notes payable under the Company's 2022-1 EETC agreement | |||
DEBT | |||
Face amount | $ | $ 188,277,000 | ||
Number of aircraft financed by debt | 13 | ||
Debt issuance costs | $ | $ 2,526,000 | ||
Number of aircraft owned and refinanced | 5 | ||
Number of aircraft owned | 2 | ||
Number of aircraft acquired in current period | 4 | ||
Number of aircraft bought-out from an existing finance lease | 2 | ||
Appraised value | $ | $ 259,688,000 | ||
Interest expense capitalized | $ | $ 2,327,000 |
DEBT - Long-term Debt Schedule
DEBT - Long-term Debt Schedule (Details) - USD ($) | Sep. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2019 |
DEBT | ||||
Total Debt | $ 373,903,000 | $ 280,931,000 | ||
Less: Unamortized debt issuance costs | (3,706,000) | (3,505,000) | ||
Less: Current Maturities of Long-term Debt | (45,535,000) | (29,412,000) | ||
Total Long-term Debt | 324,662,000 | 248,014,000 | ||
Notes payable under the Company's 2019-1 EETC agreement | Notes payable | ||||
DEBT | ||||
Total Debt | $ 194,884,000 | 202,984,000 | ||
Face amount | $ 248,587,000 | |||
Weighted average interest rate | 4.73% | |||
Notes payable under the Company's 2019-1 EETC agreement | Minimum | Notes payable | ||||
DEBT | ||||
Interest Rate | 4.13% | |||
Notes payable under the Company's 2019-1 EETC agreement | Maximum | Notes payable | ||||
DEBT | ||||
Interest Rate | 6.95% | |||
Notes payable under the Company's 2022-1 EETC agreement | Notes payable | ||||
DEBT | ||||
Total Debt | $ 179,019,000 | 0 | ||
Face amount | $ 188,277,000 | |||
Weighted average interest rate | 5.06% | |||
Notes payable under the Company's 2022-1 EETC agreement | Minimum | Notes payable | ||||
DEBT | ||||
Interest Rate | 4.84% | |||
Notes payable under the Company's 2022-1 EETC agreement | Maximum | Notes payable | ||||
DEBT | ||||
Interest Rate | 5.75% | |||
Delayed Draw Term Loan Facility | Loans Payable | ||||
DEBT | ||||
Total Debt | $ 0 | 77,481,000 | ||
Notes payable | ||||
DEBT | ||||
Total Debt | $ 0 | $ 466,000 |
DEBT - Future Maturities of the
DEBT - Future Maturities of the Outstanding Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Debt Principal Payments | ||
Remainder of 2022 | $ 18,187 | |
2023 | 58,518 | |
2024 | 60,157 | |
2025 | 65,241 | |
2026 | 45,668 | |
Thereafter | 126,132 | |
Total | 373,903 | $ 280,931 |
Amortization of Debt Issuance Costs | ||
Remainder of 2022 | (264) | |
2023 | (962) | |
2024 | (777) | |
2025 | (602) | |
2026 | (415) | |
Thereafter | (686) | |
Total | (3,706) | $ (3,505) |
Net Debt | ||
Remainder of 2022 | 17,923 | |
2023 | 57,556 | |
2024 | 59,380 | |
2025 | 64,639 | |
2026 | 45,253 | |
Thereafter | 125,446 | |
Net Debt | $ 370,197 |
DEBT - Fair Value (Details)
DEBT - Fair Value (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Debt Disclosure [Abstract] | ||
Fair value | $ 340,067 | $ 272,004 |
FUEL DERIVATIVES AND RISK MAN_3
FUEL DERIVATIVES AND RISK MANAGEMENT - Additional Information (Details) - USD ($) | Sep. 30, 2022 | Dec. 31, 2021 |
FUEL DERIVATIVES AND RISK MANAGEMENT | ||
Premiums paid | $ 0 | |
Fuel Derivative Contracts | ||
FUEL DERIVATIVES AND RISK MANAGEMENT | ||
Outstanding derivative contracts | $ 0 | $ 0 |
FUEL DERIVATIVES AND RISK MAN_4
FUEL DERIVATIVES AND RISK MANAGEMENT - Changes in Derivative Assets (Liabilities) (Details) - Fuel Derivative Contracts - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Changes in Derivative Assets (Liabilities) | ||
Balance - January 1 | $ 0 | $ (1,174) |
Non-cash Gains | 0 | 3,527 |
Contract Settlements | 0 | (2,105) |
Balance - September 30 | $ 0 | $ 248 |
FUEL DERIVATIVES AND RISK MAN_5
FUEL DERIVATIVES AND RISK MANAGEMENT - Fuel Derivative Gains (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Fuel Derivative Contracts | ||||
Fuel Derivative Gains (Losses) | ||||
Total Fuel Derivative Gains (Losses) | $ 0 | $ (72) | $ 0 | $ 3,527 |
Investments (Details)
Investments (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Debt Securities, Available-for-Sale [Line Items] | ||
Amortized Cost | $ 129,660 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (1,091) | |
Fair Value | 128,569 | |
Municipal Debt Securities | ||
Debt Securities, Available-for-Sale [Line Items] | ||
Amortized Cost | 41,108 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (331) | |
Fair Value | 40,777 | |
Corporate Debt Securities | ||
Debt Securities, Available-for-Sale [Line Items] | ||
Amortized Cost | 83,547 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (695) | |
Fair Value | 82,852 | |
U.S. Government Agency Securities | ||
Debt Securities, Available-for-Sale [Line Items] | ||
Amortized Cost | 5,005 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (65) | |
Fair Value | 4,940 | |
Certificates of Deposit | ||
Debt Securities, Available-for-Sale [Line Items] | ||
Certificates of deposit | $ 6,601 | $ 6,283 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 |
FAIR VALUE MEASUREMENTS | |||
Cash & Cash Equivalents | $ 131,912 | $ 275,332 | |
Available-for-Sale Securities: | 128,569 | ||
Municipal Debt Securities | |||
FAIR VALUE MEASUREMENTS | |||
Available-for-Sale Securities: | 40,777 | ||
Corporate Debt Securities | |||
FAIR VALUE MEASUREMENTS | |||
Available-for-Sale Securities: | 82,852 | ||
U.S. Government Agency Securities | |||
FAIR VALUE MEASUREMENTS | |||
Available-for-Sale Securities: | 4,940 | ||
Recurring | |||
FAIR VALUE MEASUREMENTS | |||
Cash & Cash Equivalents | 131,912 | $ 309,338 | |
Available-for-Sale Securities: | 128,569 | ||
Total Assets Measured at Fair Value on a Recurring Basis | 260,481 | 309,338 | |
Recurring | Municipal Debt Securities | |||
FAIR VALUE MEASUREMENTS | |||
Available-for-Sale Securities: | 40,777 | ||
Recurring | Corporate Debt Securities | |||
FAIR VALUE MEASUREMENTS | |||
Available-for-Sale Securities: | 82,852 | ||
Recurring | U.S. Government Agency Securities | |||
FAIR VALUE MEASUREMENTS | |||
Available-for-Sale Securities: | 4,940 | ||
Recurring | Level 1 | |||
FAIR VALUE MEASUREMENTS | |||
Cash & Cash Equivalents | 70,925 | 309,338 | |
Available-for-Sale Securities: | 0 | ||
Total Assets Measured at Fair Value on a Recurring Basis | 70,925 | 309,338 | |
Recurring | Level 1 | Municipal Debt Securities | |||
FAIR VALUE MEASUREMENTS | |||
Available-for-Sale Securities: | 0 | ||
Recurring | Level 1 | Corporate Debt Securities | |||
FAIR VALUE MEASUREMENTS | |||
Available-for-Sale Securities: | 0 | ||
Recurring | Level 1 | U.S. Government Agency Securities | |||
FAIR VALUE MEASUREMENTS | |||
Available-for-Sale Securities: | 0 | ||
Recurring | Level 2 | |||
FAIR VALUE MEASUREMENTS | |||
Cash & Cash Equivalents | 60,987 | 0 | |
Available-for-Sale Securities: | 128,569 | ||
Total Assets Measured at Fair Value on a Recurring Basis | 189,556 | 0 | |
Recurring | Level 2 | Municipal Debt Securities | |||
FAIR VALUE MEASUREMENTS | |||
Available-for-Sale Securities: | 40,777 | ||
Recurring | Level 2 | Corporate Debt Securities | |||
FAIR VALUE MEASUREMENTS | |||
Available-for-Sale Securities: | 82,852 | ||
Recurring | Level 2 | U.S. Government Agency Securities | |||
FAIR VALUE MEASUREMENTS | |||
Available-for-Sale Securities: | 4,940 | ||
Recurring | Level 3 | |||
FAIR VALUE MEASUREMENTS | |||
Cash & Cash Equivalents | 0 | 0 | |
Available-for-Sale Securities: | 0 | ||
Total Assets Measured at Fair Value on a Recurring Basis | 0 | $ 0 | |
Recurring | Level 3 | Municipal Debt Securities | |||
FAIR VALUE MEASUREMENTS | |||
Available-for-Sale Securities: | 0 | ||
Recurring | Level 3 | Corporate Debt Securities | |||
FAIR VALUE MEASUREMENTS | |||
Available-for-Sale Securities: | 0 | ||
Recurring | Level 3 | U.S. Government Agency Securities | |||
FAIR VALUE MEASUREMENTS | |||
Available-for-Sale Securities: | $ 0 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Mar. 16, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | ||||||
Effective tax rate | 17.40% | 13.80% | 28.40% | 18.30% | ||
Percentage of cash savings | 85% | |||||
Percentage of cash savings retained | 15% | |||||
Non-current liability recognized | $ 115,200 | $ 103,800 | $ 103,800 | $ 98,800 | ||
Decrease to the tax receivable agreement liability | $ 5,000 |
SPECIAL ITEMS, NET - Schedule o
SPECIAL ITEMS, NET - Schedule of Special Items, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Unusual or Infrequent Items, or Both [Abstract] | ||||
CARES Act grant recognition (see Note 3) | $ 0 | $ 0 | $ 0 | $ (71,587) |
CARES Act employee retention credit (See Note 3) | 0 | (68) | 0 | (848) |
Other | 0 | 3 | 0 | 16 |
Total Special Items, net | $ 0 | $ (65) | $ 0 | $ (72,419) |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Long-term Purchase Commitment [Line Items] | ||
Installment payment | $ 177,658 | $ 118,016 |
Flight Simulator | ||
Long-term Purchase Commitment [Line Items] | ||
Commitment | 9,745 | |
Installment payment | $ 8,781 |
OPERATING SEGMENTS (Details)
OPERATING SEGMENTS (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 USD ($) | Sep. 30, 2021 USD ($) | Sep. 30, 2022 USD ($) segment | Sep. 30, 2021 USD ($) | |
OPERATING SEGMENTS | ||||
Number of operating segments | segment | 2 | |||
Total Operating Revenue | $ 221,700 | $ 173,663 | $ 667,290 | $ 450,464 |
Non-Fuel Operating Expenses | 141,466 | 115,760 | 420,364 | 330,544 |
Aircraft Fuel | 64,843 | 36,647 | 206,334 | 90,631 |
Special Items, net | 0 | (65) | 0 | (72,419) |
Total Operating Expenses | 206,309 | 152,342 | 626,698 | 348,756 |
Operating Income (Loss) | 15,391 | 21,321 | 40,592 | 101,708 |
Interest Income | 1,610 | 28 | 2,166 | 52 |
Interest Expense | (7,493) | (6,286) | (23,097) | (19,487) |
Other, net | 3,422 | 456 | (5,156) | 18,505 |
Income Before Income Tax | 12,930 | 15,519 | 14,505 | 100,778 |
Passenger | ||||
OPERATING SEGMENTS | ||||
Total Operating Revenue | 198,013 | 149,263 | 601,360 | 382,380 |
Non-Fuel Operating Expenses | 117,788 | 99,960 | 355,894 | 280,272 |
Aircraft Fuel | 64,763 | 36,556 | 206,254 | 90,468 |
Special Items, net | 0 | (65) | 0 | (54,018) |
Total Operating Expenses | 182,551 | 136,451 | 562,148 | 316,722 |
Operating Income (Loss) | 15,462 | 12,812 | 39,212 | 65,658 |
Cargo | ||||
OPERATING SEGMENTS | ||||
Total Operating Revenue | 23,687 | 24,400 | 65,930 | 68,084 |
Non-Fuel Operating Expenses | 23,678 | 15,800 | 64,470 | 50,272 |
Aircraft Fuel | 80 | 91 | 80 | 163 |
Special Items, net | 0 | 0 | 0 | (18,401) |
Total Operating Expenses | 23,758 | 15,891 | 64,550 | 32,034 |
Operating Income (Loss) | $ (71) | $ 8,509 | $ 1,380 | $ 36,050 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) $ / shares in Units, $ in Thousands | Oct. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
Subsequent Event [Line Items] | |||
Common stock-par value (in dollars per share) | $ 0.01 | $ 0.01 | |
Subsequent Event | |||
Subsequent Event [Line Items] | |||
Repurchase program, authorized amount | $ 50,000 | ||
Common stock-par value (in dollars per share) | $ 0.01 |