BUZZ-Spirit Airlines jumps as lower labor costs, airport rents to prop up Q1 margins

Reuters04-15

** Shares of Spirit Airlines up ~7% at $4.46 in early trading

** SAVE largely sticks to its Q1 margin forecast, even as it flags a delay in recognition of a big portion of credits that were set to help margins in Q1

** Says better-than-expected operational efficiencies drove reduced labor costs, while lower airport rent expenses also helped

** Sees Q1 adjusted operating margin to be down 14.5% to 13.5%, compared to prior guidance of down 15% to 12%

** Firm says it had initially expected to recognize ~$38 mln of credits in Q1 as part of a compensation for quality issues with engines made by supplier Pratt & Whitney

** Says it now expects to recognize just about $1.6 mln of credits in Q1 due to a change in accounting

** Raymond James analyst Savanthi Syth says excluding impact of compensation delay, "Spirit's 1Q24 results came in comfortably ahead of our and consensus forecasts"

** YTD, stock down ~71%

(Reporting by Deborah Sophia in Bengaluru)

((DeborahMary.Sophia@thomsonreuters.com))

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap
Leave a comment