9-Mar-2010 10:52 AM

Allegiant focusing on ancillary revenue development

Allegiant Travel Company, at the Raymond James Institutional Investors Conference on 08-Mar-2010, announced the following regarding its operations:

  • Growth: Compound Annual Growth Rate (CAGR) has been 24% between 2006 and 2009, with a five-year forward CAGR estimated at 15%;
  • Network: Published schedule for 30-Jun-2010 involves 138 routes, from eight bases, using 50 operating aircraft;
  • Unit costs: Expects flat ex-fuel costs in 2010;
  • Ancillary revenue: Air-related charges totalled USD29/passenger in 2009, due to the carrier's a la carte pricing model, with third party products contributing USD4/passenger (or 3.5% of total revenues and 16.4% of pre-tax income);
  • Hawaii services: Plans to commence services to Hawaii, which the LCC labels as the "largest major US leisure market untapped by Allegiant". The carrier added that the market has "significant" ancillary revenue opportunities;
  • Fleet: Recent B757 programme announcement does "not mean a shift away from MD-80 operations". The carrier described the B757 as the "best Hawaii aircraft";
  • Unit revenues: Expects a 4% RASM improvement in Feb-2010, with a 2% increase in TRASM and a 7% upward movement in the total fare.[more]

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