COVER
COVER - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Jun. 30, 2022 | |
Cover [Abstract] | ||
Document Type | 10-K | |
Document Annual Report | true | |
Document Period End Date | Dec. 31, 2022 | |
Current Fiscal Year End Date | --12-31 | |
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 Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
ICFR Auditor Attestation Flag | false | |
Entity Shell Company | false | |
Entity Public Float | $ 602 | |
Amendment Flag | false | |
Documents Incorporated by Reference | DOCUMENTS INCORPORATED BY REFERENCE Portions of the registrant’s definitive proxy statement relating to the 2023 Annual Meeting of Stockholders are incorporated herein by references in Part III of this Annual Report on Form 10-K to the extent stated herein. Such proxy statement will be filed with the Securities and Exchange Commission within 120 days of the registrant’s fiscal year ended December 31, 2022. | |
Entity Central Index Key | 0001743907 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | FY | |
Common stock, shares outstanding (in shares) | 57,325,238 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Audit Information [Abstract] | |
Auditor Firm ID | 185 |
Auditor Name | KPMG LLP |
Auditor Location | Minneapolis, Minnesota |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Current Assets: | ||
Cash and Cash Equivalents | $ 92,086,000 | $ 309,338,000 |
Restricted Cash | 10,842,000 | 8,447,000 |
Investments | 178,936,000 | 6,283,000 |
Accounts Receivable, net of an allowance for credit losses of $231 and $250, respectively | 35,124,000 | 30,156,000 |
Short-term Lessor Maintenance Deposits | 1,241,000 | 5,505,000 |
Inventory, net of a reserve for obsolescence of $1,107 and $1,275, respectively | 7,659,000 | 5,405,000 |
Prepaid Expenses | 11,423,000 | 8,511,000 |
Other Current Assets | 8,179,000 | 1,798,000 |
Total Current Assets | 345,490,000 | 375,443,000 |
Property & Equipment, net: | ||
Finance Lease Assets | 261,991,000 | 209,457,000 |
Total Property & Equipment | 962,413,000 | 695,587,000 |
Accumulated Depreciation & Amortization | (176,746,000) | (117,069,000) |
Total Property & Equipment, net | 785,667,000 | 578,518,000 |
Other Assets: | ||
Goodwill | 222,223,000 | 222,223,000 |
Other Intangible Assets, net of accumulated amortization of $18,890 and $14,890, respectively | 85,110,000 | 89,110,000 |
Operating Lease Right-of-use Assets | 22,182,000 | 61,658,000 |
Aircraft Deposits | 9,134,000 | 10,021,000 |
Long-term Lessor Maintenance Deposits | 32,433,000 | 20,346,000 |
Deferred Tax Assets | 12,956,000 | 17,608,000 |
Other Assets | 9,217,000 | 5,495,000 |
Total Other Assets | 393,255,000 | 426,461,000 |
Total Assets | 1,524,412,000 | 1,380,422,000 |
Current Liabilities: | ||
Accounts Payable | 62,370,000 | 39,805,000 |
Accrued Salaries, Wages, and Benefits | 26,521,000 | 28,527,000 |
Accrued Transportation Taxes | 17,666,000 | 12,736,000 |
Air Traffic Liabilities | 157,995,000 | 118,562,000 |
Over-market Liabilities | 1,535,000 | 4,309,000 |
Finance Lease Obligations | 17,990,000 | 11,705,000 |
Loyalty Program Liabilities | 13,963,000 | 11,451,000 |
Operating Lease Obligations | 6,296,000 | 17,231,000 |
Current Maturities of Long-term Debt | 57,548,000 | 29,412,000 |
Income Tax Receivable Agreement Liability | 2,260,000 | 0 |
Other Current Liabilities | 12,984,000 | 7,913,000 |
Total Current Liabilities | 377,128,000 | 281,651,000 |
Long-term Liabilities: | ||
Over-market Liabilities | 1,039,000 | 10,428,000 |
Finance Lease Obligations | 233,306,000 | 180,450,000 |
Loyalty Program Liabilities | 1,474,000 | 8,267,000 |
Operating Lease Obligations | 19,836,000 | 58,810,000 |
Long-term Debt | 294,687,000 | 248,014,000 |
Income Tax Receivable Agreement Liability | 101,540,000 | 98,800,000 |
Other Long-term Liabilities | 2,690,000 | 3,413,000 |
Total Long-term Liabilities | 654,572,000 | 608,182,000 |
Total Liabilities | 1,031,700,000 | 889,833,000 |
Commitments and Contingencies (Note 18) | ||
Stockholders' Equity: | ||
Common stock with $0.01 par value, 995,000,000 shares authorized, 58,217,647 and 57,872,452 issued and 57,325,238 and 57,872,452 outstanding at December 31, 2022 and 2021, respectively | 582,000 | 579,000 |
Preferred stock with $0.01 par value, 5,000,000 shares authorized, no shares issued and outstanding at December 31, 2022 and 2021, respectively | 0 | 0 |
Treasury stock, at cost, 892,409 and no shares held at December 31, 2022 and 2021, respectively | (17,605,000) | 0 |
Additional Paid-In Capital | 488,494,000 | 485,638,000 |
Retained Earnings | 22,048,000 | 4,372,000 |
Accumulated Other Comprehensive Loss | (807,000) | 0 |
Total Stockholders' Equity | 492,712,000 | 490,589,000 |
Total Liabilities and Stockholders' Equity | 1,524,412,000 | 1,380,422,000 |
Aircraft and Flight Equipment | ||
Property & Equipment, net: | ||
Property & Equipment, net: | 636,584,000 | 447,319,000 |
Ground Equipment and Leasehold Improvements | ||
Property & Equipment, net: | ||
Property & Equipment, net: | 35,948,000 | 20,876,000 |
Computer Hardware and Software | ||
Property & Equipment, net: | ||
Property & Equipment, net: | 10,831,000 | 8,785,000 |
Rotable Parts | ||
Property & Equipment, net: | ||
Property & Equipment, net: | $ 17,059,000 | $ 9,150,000 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Accounts Receivable, allowance for credit losses | $ 231 | $ 250 |
Inventory, reserve for obsolescence | 1,107 | 1,275 |
Accumulated amortization | $ 18,890 | $ 14,890 |
Common stock-shares authorized (in shares) | 995,000,000 | 995,000,000 |
Common stock-shares issued (in shares) | 58,217,647 | 57,872,452 |
Common stock-par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock-shares outstanding | 57,325,238 | 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) | 892,409 | 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Operating Revenues: | |||
Total Operating Revenue | $ 894,444 | $ 623,015 | $ 401,486 |
Operating Expenses: | |||
Aircraft Fuel | 268,363 | 129,110 | 83,392 |
Salaries, Wages, and Benefits | 245,855 | 178,207 | 141,641 |
Aircraft Rent | 8,768 | 17,653 | 30,989 |
Maintenance | 46,604 | 40,095 | 27,416 |
Sales and Marketing | 31,053 | 22,060 | 16,570 |
Depreciation and Amortization | 67,641 | 57,075 | 48,086 |
Ground Handling | 33,816 | 26,981 | 20,596 |
Landing Fees and Airport Rent | 45,658 | 40,726 | 31,256 |
Special Items, net | 0 | (72,419) | (64,563) |
Other Operating, net | 90,978 | 71,580 | 48,718 |
Total Operating Expenses | 838,736 | 511,068 | 384,101 |
Operating Income | 55,708 | 111,947 | 17,385 |
Non-operating Income (Expense): | |||
Interest Income | 4,527 | 85 | 377 |
Interest Expense | (31,018) | (26,326) | (22,073) |
Other, net | (5,235) | 14,624 | (371) |
Total Non-operating Income (Expense), net | (31,726) | (11,617) | (22,067) |
Income (Loss) before Income Tax | 23,982 | 100,330 | (4,682) |
Income Tax Expense (Benefit) | 6,306 | 19,082 | (778) |
Net Income (Loss) | $ 17,676 | $ 81,248 | $ (3,904) |
Net Income (Loss) per share to common stockholders: | |||
Basic (in dollars per share) | $ 0.31 | $ 1.47 | $ (0.08) |
Diluted (in dollars per share) | $ 0.29 | $ 1.37 | $ (0.08) |
Shares used for computation: | |||
Basic (in shares) | 57,951,955 | 55,182,811 | 46,806,042 |
Diluted (in shares) | 61,046,595 | 59,324,040 | 46,806,042 |
Passenger | |||
Operating Revenues: | |||
Total Operating Revenue | $ 792,433 | $ 523,945 | $ 359,232 |
Cargo | |||
Operating Revenues: | |||
Total Operating Revenue | 90,350 | 91,428 | 36,809 |
Other | |||
Operating Revenues: | |||
Total Operating Revenue | $ 11,661 | $ 7,642 | $ 5,445 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||
Net Income (Loss) | $ 17,676 | $ 81,248 | $ (3,904) |
Other Comprehensive Loss: | |||
Net unrealized loss on Available-for-Sale securities, net of deferred tax benefit of $241, $—, and $—, respectively | (807) | 0 | 0 |
Other Comprehensive Loss | (807) | 0 | 0 |
Comprehensive Income (Loss) | $ 16,869 | $ 81,248 | $ (3,904) |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Warrants | Common Stock | Treasury Stock | Loans to Stockholders | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss |
Balances, at beginning of period (in shares) at Dec. 31, 2019 | 40,638,068 | 6,800,065 | ||||||
Balances, at beginning of period at Dec. 31, 2019 | $ 283,724 | $ 68 | $ 0 | $ (3,500) | $ 244,928 | $ 42,228 | $ 0 | |
Treasury Stock, at beginning of period (in shares) at Dec. 31, 2019 | 0 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Exercise of Apollo Warrants (in shares) | (40,005,885) | 40,005,885 | ||||||
Exercise of Apollo Warrants | 21 | $ 400 | (379) | |||||
Net Income (Loss) | (3,904) | (3,904) | ||||||
Warrants issued (in shares) | 252,869 | |||||||
Amazon Warrants | 1,866 | 1,866 | ||||||
Stock-based Compensation (in shares) | 33,709 | |||||||
Stock-based Compensation | 2,110 | 2,110 | ||||||
Balances, at end of period (in shares) at Dec. 31, 2020 | 885,052 | 46,839,659 | ||||||
Treasury Stock, at end of period (in shares) at Dec. 31, 2020 | 0 | |||||||
Balances, at end of period at Dec. 31, 2020 | 283,817 | $ 468 | $ 0 | (3,500) | 248,525 | 38,324 | 0 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net Income (Loss) | 81,248 | 81,248 | ||||||
Warrants issued (in shares) | 758,608 | |||||||
Amazon Warrants | 5,600 | 5,600 | ||||||
Stock-based Compensation | 5,562 | 5,562 | ||||||
Exercise of Stock Options (in shares) | 718,985 | |||||||
Exercise of Stock Options | 4,233 | $ 7 | 4,226 | |||||
Shares Surrendered by Stockholders (in shares) | (140,737) | |||||||
Shares Surrendered by Stockholders | $ (1) | 3,500 | (3,499) | |||||
Initial Public Offering (in shares) | 10,454,545 | |||||||
Initial Public Offering | 225,329 | $ 105 | 225,224 | |||||
Income Tax Receivable Agreement | $ (115,200) | (115,200) | ||||||
Balances, at end of period (in shares) at Dec. 31, 2021 | 1,643,660 | 57,872,452 | ||||||
Treasury Stock, at end of period (in shares) at Dec. 31, 2021 | 0 | 0 | ||||||
Balances, at end of period at Dec. 31, 2021 | $ 490,589 | $ 579 | $ 0 | 0 | 485,638 | 4,372 | 0 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net Income (Loss) | 17,676 | 17,676 | ||||||
Warrants issued (in shares) | 758,608 | |||||||
Amazon Warrants | 5,600 | 5,600 | ||||||
Stock-based Compensation | 2,774 | 2,774 | ||||||
Shares Surrendered by Stockholders | (52) | $ (52) | ||||||
Stock issued for Stock-Based Awards (in shares) | 345,195 | |||||||
Stock issued for Stock-Based Awards | 1,986 | $ 3 | 1,983 | |||||
Net stock settlement of stock-based awards (in shares) | 1,823 | |||||||
Common stock repurchases (in shares) | 890,586 | |||||||
Common Stock Repurchases | (25,054) | $ (17,553) | (7,501) | |||||
Other Comprehensive Loss | $ (807) | (807) | ||||||
Balances, at end of period (in shares) at Dec. 31, 2022 | 2,402,268 | 58,217,647 | ||||||
Treasury Stock, at end of period (in shares) at Dec. 31, 2022 | 892,409 | 892,409 | ||||||
Balances, at end of period at Dec. 31, 2022 | $ 492,712 | $ 582 | $ (17,605) | $ 0 | $ 488,494 | $ 22,048 | $ (807) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Cash Flows [Abstract] | |||
Net Income (Loss) | $ 17,676 | $ 81,248 | $ (3,904) |
Adjustments to reconcile Net Income (Loss) to Cash from Operating Activities: | |||
Depreciation and Amortization | 67,641 | 57,075 | 48,086 |
Tax Receivable Agreement Adjustment | 5,000 | (16,400) | 0 |
Operating Lease Right-of-use Assets | 1,538 | 16,477 | 25,880 |
(Gain) Loss on Asset Transactions, net | (1,107) | (5) | 413 |
Unrealized (Gain) Loss on Fuel Derivatives | 0 | (3,527) | 12,206 |
Amortization of Over-market Liabilities | (2,837) | (5,236) | (10,421) |
Deferred Income Taxes | 4,893 | 18,609 | (789) |
Amazon Warrants Vested | 5,600 | 5,600 | 1,866 |
Stock-based Compensation Expense | 2,774 | 5,562 | 2,110 |
Amortization of Debt Issuance Costs and Debt Securities | 172 | 1,239 | 1,523 |
Loss on Extinguishment of Debt | 1,557 | 1,224 | 0 |
Changes in Operating Assets and Liabilities: | |||
Accounts Receivable | (3,312) | (481) | (6,282) |
Inventory | (3,014) | (484) | (614) |
Prepaid Expenses | (2,918) | (510) | 15 |
Lessor Maintenance Deposits | (13,005) | (8,089) | (9,415) |
Aircraft Deposits | (2,583) | 445 | 1,290 |
Other Assets | (8,403) | 2,351 | (5,447) |
Accounts Payable | 17,623 | 5,820 | (7,174) |
Accrued Transportation Taxes | 4,930 | 6,853 | (7,845) |
Air Traffic Liabilities | 39,433 | 17,486 | (15,584) |
Loyalty Program Liabilities | (4,281) | (2,351) | (823) |
Operating Lease Obligations | (1,718) | (37,101) | (28,352) |
Other Liabilities | 1,781 | 13,171 | 3,635 |
Net Cash Provided by Operating Activities | 127,440 | 158,976 | 374 |
Cash Flows from Investing Activities: | |||
Purchases of Property & Equipment | (187,922) | (123,332) | (96,298) |
Proceeds from the Sale of Property & Equipment | 2,451 | 56 | 200 |
Proceeds from Insurance Settlements | 8,865 | 0 | 0 |
Purchase of Investments | (178,960) | (1,797) | (927) |
Proceeds from the Sale of Investments | 1,236 | 1,137 | 997 |
Proceeds from the Maturities of Investments | 5,000 | 0 | 0 |
Net Cash Used in Investing Activities | (349,330) | (123,936) | (96,028) |
Cash Flows from Financing Activities: | |||
Cash Received from Stock Offering | 0 | 235,894 | 0 |
Costs of Stock Offering | 0 | (8,384) | 0 |
Proceeds from Stock Option and Warrant Exercises | 1,965 | 4,233 | 21 |
Taxes Paid for Net Stock Settlement of Stock-Based Awards | (31) | 0 | 0 |
Common Stock Repurchases | (25,054) | 0 | 0 |
Proceeds from Borrowings | 188,277 | 80,500 | 265,307 |
Repayment of Finance Lease Obligations | (42,062) | (11,931) | (89,697) |
Repayment of Borrowings | (113,492) | (85,370) | (69,906) |
Debt Issuance Costs | (2,570) | (2,560) | (4,186) |
Net Cash Provided by Financing Activities | 7,033 | 212,382 | 101,539 |
Net (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash | (214,857) | 247,422 | 5,885 |
Cash, Cash Equivalents and Restricted Cash--Beginning of the Period | 317,785 | 70,363 | 64,478 |
Cash, Cash Equivalents and Restricted Cash--End of the Period | 102,928 | 317,785 | 70,363 |
Supplemental information: | |||
Cash Payments for Interest | 24,051 | 23,601 | 20,304 |
Cash Payments for Income Taxes, net | 1,691 | 172 | 47 |
Non-cash transactions: | |||
Operating Lease Deposits Applied Against the Purchase of Aircraft | 1,085 | 3,296 | 19,976 |
Aircraft and Flight Equipment Acquired through Finance Leases | 40,480 | 91,134 | 0 |
Finance Lease Asset Modifications | 46,311 | 0 | 0 |
Aircraft Acquired from Exercise of Finance Lease Purchase Option, net of Accumulated Depreciation | 28,012 | 0 | 0 |
Purchases of Property & Equipment in Accounts Payable | 4,367 | 221 | 734 |
Derecognition of Operating Lease Right-of-Use Assets, net | 8,674 | 41,135 | 0 |
Derecognition of Operating Lease Obligations | $ 8,674 | $ 44,726 | $ 0 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parentheticals) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Reconciliation of Cash, Cash Equivalents and Restricted Cash | ||||
Cash and Cash Equivalents | $ 92,086 | $ 309,338 | $ 62,028 | |
Restricted Cash | 10,842 | 8,447 | 8,335 | |
Total Cash, Cash Equivalents and Restricted Cash | $ 102,928 | $ 317,785 | $ 70,363 | $ 64,478 |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||
Deferred tax benefit | $ 241 | $ 0 | $ 0 |
COMPANY BACKGROUND
COMPANY BACKGROUND | 12 Months Ended |
Dec. 31, 2022 | |
COMPANY BACKGROUND | |
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 When certain investment funds managed by affiliates of Apollo Global Management, Inc. (the “Apollo Funds”) purchased the Company in 2018, SCA Horus Holdings, LLC, (the “Apollo Stockholder”) was issued 5,326,755 shares of common stock of SCA Acquisition Holdings, LLC with no par value. Also in 2018, SCA Acquisition Holdings, LLC issued 40,005,885 warrants to the Apollo Stockholder allowing it to acquire shares of common stock of SCA Acquisition Holdings, LLC at the exercise price of approximately $0.0005 per share. On January 31, 2020, all 40,005,885 outstanding warrants were exercised to purchase common stock of SCA Acquisition Holdings, LLC. In conjunction with the issuance of 1,416,645 shares of common stock of SCA Acquisition Holdings, LLC in 2018 to two stockholders, the Company issued, recourse promissory notes of $3,500, which are included as Loans to Stockholders on the Consolidated Statements of Changes in Stockholders’ Equity. In February of 2021, these promissory notes were repaid in full with equivalent shares of stock. On January 31, 2020, SCA Acquisition Holdings, LLC was converted into a Delaware corporation pursuant to a statutory conversion and changed its name to Sun Country Airlines Holdings, Inc. In connection with the conversion to a corporation, all of the outstanding shares, warrants and options were converted into shares or rights to shares of Sun Country Airlines Holdings, Inc. Stock Split In March 2021, the Company effected an approximately 18.8886 for 1 stock split of its common stock (the “Stock Split”), with exercise prices for outstanding warrants and options adjusted accordingly by dividing such prices by the Stock Split ratio. The $0.01 par value of the common stock was not adjusted in connection with the Stock Split. As a result of the Stock Split, the Company issued an additional 44,226,587 shares of common stock. All references to common stock, warrants to purchase common stock, stock options, per share amounts and related information contained in the accompanying Consolidated Financial Statements and applicable disclosures have been retroactively adjusted to reflect the effect of the Stock Split for all periods. Initial Public Offering of Common Stock and Other Stock Sales 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, 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 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 a public offering price 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 and October 2021 offerings, the underwriters elected to purchase an additional 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 and did not receive any of the proceeds from these offerings. 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 years ended December 31, 2022, 2021 and 2020, total warrants vested were 758,608, 758,608 and 252,869, respectively. This resulted in Amazon holding 2,402,268 vested warrants as of December 31, 2022. The exercise period of these warrants is through the eighth anniversary of the issue date. |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2022 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation – The consolidated financial statements include the accounts of Sun Country Airlines Holdings, Inc. and its subsidiaries and have been prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). All material intercompany balances and transactions have been eliminated in consolidation. The Company reclassified certain prior period amounts to conform to the current period presentation. The Company operates its fiscal year on a calendar year basis. Use of Estimates – The preparation of financial statements in conformity with GAAP requires management to make 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 and the reported amounts of revenues and expenses during the reporting periods. 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. Management believes that all adjustments necessary for the fair presentation of results, consisting of normally recurring items, have been included in the Consolidated Financial Statements. Revision of Previously Issued Consolidated Financial Statements During the second quarter of 2022, the Company identified an immaterial misstatement in its Consolidated Financial Statements for 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 Sheets 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 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 year ended December 31, 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 Consolidated Financial Statements and notes included in this Annual Report on Form 10-K. 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 Consolidated Statements of Operations for the year ended December 31, 2021 are as follows: Year Ended December 31, 2021 As Previously Issued Correction As Revised Operating Expenses Depreciation and Amortization $ 55,019 $ 2,056 $ 57,075 Special Items, net (65,456) (6,963) (72,419) Total Operating Expenses 515,975 (4,907) 511,068 Operating Income 107,040 4,907 111,947 Income Before Income Tax 95,423 4,907 100,330 Income Tax Expense 17,953 1,129 19,082 Net Income 77,470 3,778 81,248 Basic Income per share $ 1.40 $ 0.07 $ 1.47 Diluted Income per share $ 1.31 $ 0.06 $ 1.37 The Company's Consolidated Statement of Changes in 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 Consolidated Statements of Cash Flows for the year ended December 31, 2021 is as follows: Year Ended December 31, 2021 As Previously Issued Correction As Revised Operating Activities Net Income $ 77,470 $ 3,778 $ 81,248 Depreciation and Amortization 55,019 2,056 57,075 Non-Cash Gain on Asset Transaction, Net (12,673) 12,668 (5) Deferred Income Taxes 17,480 1,129 18,609 Operating Lease Obligations (24,433) (12,668) (37,101) Net Cash Provided by Operating Activities 152,013 6,963 158,976 Investing Activities Purchases of Property & Equipment (116,369) (6,963) (123,332) Net Cash Used in Investing Activities $ (116,973) $ (6,963) $ (123,936) The revision had no impact on the Company's Net Cash Provided by Financing Activities for the year ended December 31, 2021. A summary of significant accounting policies consistently applied in the preparation of the accompanying financial statements is as follows: Revenue Recognition – Scheduled passenger service, charter service, and most ancillary revenues are recognized when the passenger flight occurs. Revenues exclude amounts collected on behalf of other parties, including transportation taxes. Scheduled Service. The Company initially defers ticket sales as an Air Traffic Liability and recognizes revenue when the passenger flight occurs. Unused non-refundable tickets expire at the date of scheduled travel and are recorded as revenue unless the customer notifies the Company in advance of such date that the customer will not travel. If notification is made, a travel credit is created for the face value less applicable change fees. Travel credits may generally be redeemed toward future travel for up to 12 months after the date of the original booking. Therefore, these credits are recorded as a current liability on the Company's Consolidated Balance Sheets. The Company records an estimate for travel credits that will expire unused, otherwise known as breakage, in Passenger Revenue upon issuance of the travel credit. The estimated breakage rate is primarily based on historical experience of travel credit activity and other factors that may not be indicative of future trends, such as the COVID-19 pandemic, program changes or modifications that could affect the ultimate usage patterns of tickets and travel credits. The Company continuously monitors its breakage rate assumptions and may adjust its estimated breakage rate in the future. Changes in the Company’s estimated breakage rate impacts revenue recognition prospectively. The Company currently accounts for direct selling costs, including credit card fees, and commissions, in accordance with the terms of each service. The expense is deferred and recognized when the travel occurs. Ancillary. Ancillary revenue consists primarily of revenue generated from air travel-related services such as baggage fees, seat selection and upgrade fees, priority check-in and boarding fees, itinerary service fees and on-board sales, which are recognized when the associated flight occurs. Revenue for change fees is deferred and recognized when the passenger travel is provided. Fees received in advance of the flight date are initially recorded as an Air Traffic Liability. Charter. Charter revenue is recognized at the time of departure when transportation is provided. Revenue is generated from airline service agreements and is typically based on block hours flown. Under these agreements, the Company is obligated to provide aircraft for travel. Customers are generally responsible for aircraft fuel, landing fees, and certain other flight expenses, which are typically arranged by the Company. When functioning as the customers' agent for arranging such services, the Company records amounts reimbursable from the customer as revenues, net of the associated costs incurred to fulfill the performance obligations. The typical lead time for a charter flight is significantly less than one year; therefore, the Company does not capitalize cost related to obtaining the contract. Cargo. The ATSA is a six-year contract and includes two, two-year extensions exercisable at Amazon’s option, providing for a total term of ten years if both extension options are exercised. Each extension must be exercised with at least 180 days’ prior written notice before the expiration of the then-current term. The ATSA has annual rate escalations. Rate increases occurred on December 13, 2022, 2021, and 2020. Cargo revenue is typically recognized based on hours flown, number of flights, and the amount of aircraft resources provided during a reporting period. The ATSA contains three performance obligations: Flight Services, Heavy Maintenance and Fuel. As Sun Country is the principal in providing Flight Services, revenue and related costs are recognized gross on the Statement of Operations. Sun Country acts as the agent in providing the Heavy Maintenance and Fuel performance obligations, which are reimbursed by Amazon based on the actual costs incurred. Consumption of aircraft fuel and heavy maintenance are recognized in revenue, net of the associated costs incurred to fulfill the performance obligations. The ATSA with Amazon consists of three main components for revenue; a fixed amount is received each month per aircraft, a fixed amount is received each month per flight, and an amount per block hour is received each month. The ATSA contains a Service Level Agreement ("SLA") and penalties for certain delays and cancellations. The SLA can result in a bonus or penalty for the month depending on the Company's performance. When determining the transaction price, the Company will estimate the variable consideration and consideration payable to Amazon over the contract term. Each period, the Company updates its estimate for the variable consideration and consideration payable to the customer and treats the adjustment as an adjustment to the transaction price. When updating the estimate, the Company considers whether there are any changes in expected block hours, changes in expected bonuses or penalties based on performance, changes in warrants expected to be issued, and changes in reimbursable costs. The transaction price is allocated to the performance obligations based on their relative standalone selling price. The transaction price for Flight Services, which includes an upfront payment for startup costs, is reduced by the estimated value of warrants to be issued to Amazon based on expected performance under the ATSA. Loyalty Program Accounting – The Company records a liability for loyalty points earned by passengers under its 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 breakage, and 2) a liability for points attributed to loyalty points issued to the Company’s co-branded credit card holders is established by deferring a portion of payments received from the Company’s co-branded agreement. The Company’s Sun Country Rewards program allows for the redemption of loyalty points to include payment towards air travel, land travel, taxes, and other ancillary purchases. The Company determines the standalone selling price of loyalty points issued using a redemption value approach, which considers the value a passenger will receive upon redemption of the loyalty points. Consideration allocated to loyalty points is deferred, net of estimated breakage, and recognized as Passenger Revenue when both the loyalty points have been redeemed and the passenger travel occurs. The Company estimates breakage for loyalty points that are not likely to be redeemed. These estimates are based on historical experience of loyalty point redemption activity and other factors, such as program changes and modifications that could affect the ultimate usage pattern of loyalty points. The current portion of the Loyalty Point Liability is an estimate primarily based on historical redemption patterns over the past 12 months, as well as other factors that may not be indicative of historical trends. Under the Company's co-branded credit card program, funds received for the marketing of a co-branded credit card and delivery of loyalty points are accounted for as a multiple-deliverable arrangement. At the inception of the arrangement, the Company evaluated all deliverables in the arrangement to determine whether they represent distinct performance obligations. The Company determined the arrangement has two distinct performance obligations: loyalty points to be awarded, and brand and marketing. Funds received are allocated based on relative standalone selling price. Revenue for the brand and marketing performance obligation is recognized as revenue when earned and recorded in Other Revenue. Consideration allocated to loyalty points is deferred and recognized as Passenger Revenue upon future redemption of the points. Cash and Equivalents – The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. The Company maintains cash balances at several financial institutions; at times, such balances may be in excess of insurance limits. The Company has not experienced any losses on these balances. Restricted Cash – Charter revenue receipts received prior to the date of transportation are recorded as Restricted Cash and as a component of the Air Traffic Liabilities. Department of Transportation ("DOT") regulations require that charter revenue receipts received prior to the date of transportation are maintained in a separate third-party escrow account. The restrictions are released once transportation is provided, which is typically within 12 months of booking. For that reason, the balance of Restricted Cash is classified as a current asset on the Company's Consolidated Balance Sheets. Investments – The Company's 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. The Debt Securities are classified as Current Assets on the 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. These investments have original maturities of three months or greater. Most of the Company's Debt 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. Securities downgraded below policy minimums after purchase will be disposed of in accordance with the Company’s investment policy. The Company's Debt Securities are classified as Available-for-Sale and are reported at fair value on the Company's Consolidated Balance Sheets. Unrealized gains and losses on the Company's Available-for-Sale securities are excluded from Net Income and are reported as a component of Accumulated Other Comprehensive Income, net of income tax effects, within Stockholders' Equity on the 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 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 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 Consolidated Statement of Operations. The Company did not recognize any impairment losses on its Available-for-Sale investments for the year ended December 31, 2022. Accounts Receivable – Accounts Receivable are recorded at the amount due from customers and do not bear interest. They consist primarily of amounts due from Amazon, credit card companies associated with ticket sales and charter service customers. The Company's Accounts Receivable balances at December 31, 2022 and 2021 also included $1,000 and $2,163, respectively, due from aircraft lessors related to maintenance deposits. Accounts outstanding longer than the contractual payment terms are considered past due. The Company determines its allowances for credit losses by considering a number of factors, including the length of time accounts receivable are past due, the Company’s previous loss history, the customer’s current ability to pay its obligation to the Company, and the condition of the general economy and the industry as a whole. During the years ended December 31, 2022, 2021 and 2020, $70, $17 and $982 in Accounts Receivable were written off, respectively. Lessor Maintenance Deposits – Certain of the Company’s aircraft lease agreements provide that the Company pay maintenance reserves monthly to aircraft lessors to be held as collateral in advance of major maintenance activities required to be performed by the Company. Generally, maintenance reserve payments are variable based on actual flight hours or cycles. These lease agreements provide that maintenance reserves are reimbursable to the Company upon completion of the maintenance event in an amount equal to the lesser of (1) the amount of the maintenance reserve held by the lessor associated with the specific maintenance event or (2) the qualifying costs related to the specific maintenance event. Maintenance reserve payments that are expected to be recoverable via reimbursable expenses are reflected as Lessor Maintenance Deposits on the accompanying Consolidated Balance Sheets. These deposits are expected to be reimbursed to the Company upon performance of maintenance activities. Upon completion of the maintenance event, the lessor is billed and the amount due is recorded in Accounts Receivable. Lessor Maintenance Deposits not deemed probable of recovery are expensed as incurred. The Company makes certain assumptions at the inception of the lease and at each Balance Sheet date to determine the recoverability of maintenance deposits. These assumptions are based on various factors, such as the estimated time between the maintenance events, the cost of such maintenance events, the date the aircraft is due to be returned to the lessor and the number of flight hours and cycles the aircraft is estimated to be utilized before it is purchased or returned to the lessor. Changes in estimates are accounted for on a prospective basis. At the April 11, 2018 acquisition date of Sun Country, Inc. (the “Acquisition Date”), the Company established a contra-asset to 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, the contra-asset is recognized as a reduction to Maintenance expense. Inventory – Inventories primarily consist of expendable parts related to flight equipment, which cannot be economically repaired, reconditioned or reused after removal from the aircraft, are carried at average cost and charged to operations as consumed. An allowance for obsolescence and excess is provided over the remaining useful life of the related fleet for spare parts expected to be on hand at the date that aircraft type is retired from service. These parts are assumed to have an estimated residual value of 10% of the original cost. Leases – Lease classification is evaluated by the Company at lease commencement and when significant amendments are executed . The Company's leases generally do not provide a readily determinable implicit rate; therefore, the Company estimates the incremental borrowing rate to discount lease payments based on information available at lease commencement. The lease term consists of the noncancellable period of the lease and periods covered by options to extend the lease if the Company is reasonably certain to exercise the option. For leases of 12 months or less, the Company expenses lease payments on a straight-line basis over the lease term. Operating Lease Right-of-Use Asset and Liabilities For all operating leases with a term greater than 12 months, the Company recognizes a right-of-use asset and a lease liability at the lease commencement date based on the estimated present value of future minimum lease payments, which includes certain lease and non-lease components, over the lease term. Operating Lease Right-of-use Assets and Operating Lease Obligations have their own lines on the Consolidated Balance Sheets. Finance Leases Finance leases are initially recorded at the net present value of future minimum lease payments, which includes certain lease and non-lease components. Finance leases generally have one of these five attributes: 1) ownership of the underlying asset transfers to the Company at the end of the lease term, 2) the lease agreement contains a purchase option that the Company is reasonably certain to exercise, 3) the lease term represents the major part of the asset’s economic life , 4) the present value of lease payments over the lease term equals or exceeds substantially all of the fair value of the asset, and 5) the underlying asset is so specialized in nature that it provides no alternative use to the lessor after the lease term . Finance Lease Assets are presented on separately on the Consolidated Balance Sheets. The Company depreciates Finance Lease Assets consistent with its useful life policy presented in the table below. Leased Aircraft Return Costs The Company's aircraft lease agreements often contain provisions that require the Company to return aircraft airframes, engines, and other aircraft components to the lessor in a certain condition or pay an amount to the lessor based on the airframe and engine's actual return condition. Lease return costs are recognized beginning when it is probable that such costs will be incurred and they can be estimated. The Company assesses the need to accrue lease return costs periodically throughout the year or whenever facts and circumstances warrant an assessment. When costs become both probable and estimable, lease return costs are expensed as a component of Aircraft Rent expense on the Consolidated Statements of Operations. Property & Equipment – Property and equipment are recorded at cost or fair value at the Acquisition Date and depreciated, when the asset is ready for its intended use, on a straight-line basis to an estimated residual value over their estimated useful lives or lease term (if applicable), whichever is shorter, as follows: Airframes 10-25 years (depending on age) Engines – Core 7 or 12 years (based on remaining cycles) Engines - Initial Greentime (time remaining until the first scheduled major maintenance event) 1 st scheduled maintenance event Leasehold Improvements, Aircraft, Other 3-25 years (or life of lease, if shorter) Office and Ground Equipment 5-7 years Computer Hardware and Software 3-5 years Property and Equipment under Finance Leases Lesser of the lease term or economic life Rotable Parts Average remaining life of aircraft fleet, currently estimated to be 6-16 years Modifications that enhance the operating performance or extend the useful lives of leased airframes are considered leasehold improvements and are capitalized and depreciated over the economic life of the asset or the term of the lease, whichever is shorter. Similar modifications made to owned aircraft are capitalized and depreciated consistent with the Company’s policy. The Company capitalizes certain internal and external costs associated with the acquisition and development of internal-use software for new products, and enhancements to existing products, that have reached the application development stage and meet recoverability tests. Capitalized costs include external direct costs of materials and services utilized in developing or obtaining internal-use software, and labor cost for employees who are directly associated with, and devote time to, internal-use software projects. The Company depreciates Rotable Parts to an estimated residual value using the pooling life method. Depreciation under the pooling life method is calculated over the estimated average useful life of the passenger aircraft fleet. The Company capitalizes certain costs of activities necessary to get the asset ready for its intended use. Capitalized interest represents interest costs incurred during the aircraft induction period, capitalization ceases when the asset is ready for service. See Note 8 for further information on the Company's Long-Term Debt. Airframe and Engine Maintenance – The Company accounts for non-major maintenance and repair costs incurred, as well as major maintenance costs of owned airframes, all leased airframes, and engines acquired via operating leases, using the expense as incurred method. Certain costs covered by third-party maintenance agreements are charged to expense based on an hourly fee, as defined by the contract. These expenses are reported as a component of Maintenance expense on the accompanying Consolidated Statements of Operations. The Company applies the Built-in Overhaul method for significant maintenance costs of owned engines, as well as to engines acquired via finance leases where the Company is reasonably certain to exercise a purchase option. Under this method, engine values are separated into amounts for life limited parts and “greentime”, representing the value of the engine for the time on-wing remaining until the next anticipated major maintenance event. Life limited parts are capitalized based on catalog rates published by the original equipment manufacturer and depreciated over their estimated useful lives. Initial engine "greentime" and subsequent major engine maintenance events are capitalized and depreciated until the next anticipated major maintenance event, assuming no residual value. The estimated period until the next scheduled major maintenance event is estimated based on assumptions such as estimated cycles, hours, and months, required maintenance intervals, and the age/condition of related parts. These assumptions may change based on forecasted aircraft utilization changes, updates to government regulations, and manufacturer maintenance intervals, as well as unplanned incidents causing damage requiring a major maintenance event prior to a scheduled visit. If the estimated timing of the next maintenance event changes, the related depreciation period changes prospectively. These expenses are reported as a component of Depreciation and Amortization on the accompanying Consolidated Statements of Operations. Asset Impairment Analysis – Long-lived assets, such as Property & Equipment and Finite-Lived Intangible Assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset (or asset group) may not be recoverable. If circumstances require a long-lived asset or asset group be tested for impairment, the Company first compares the undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying amount exceeds its fair value. Fair value is determined using various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. To determine whether impairment exists, the Company grouped its assets based on the lowest level of identifiable cash flows, which is its operating segments. This is due to the Company operating a Passenger Service fleet comprised exclusively of one type of aircraft, the Boeing 737-NG. Primarily all of the Company’s long-lived assets are owned by, or associated with, the Passenger operating segment. No impairment losses were recognized during the years ended December 31, 2022, 2021 or 2020. Goodwill and Other Intangible Assets – Goodwill represents the excess purchase price over the estimated fair value of net assets acquired in a business combination. Indefinite-Lived Intangible Assets represents a tradename acquired in a business combination and Finite-Lived Intangible Assets represent customer relationships. Goodwill and Other Indefinite-Lived Intangible Assets must be tested for impairment at least annually, or more frequently if events or changes in circumstances indicate that they might be impaired. Goodwill is tested at the reporting unit level. The Company has two reporting units: Passenger and Cargo, all Goodwill is related to the passenger reporting unit. Finite-Lived Intangible Assets are amortized over an estimated useful life based on several factors, including the effects of demand, competition, contractual relationship, and other business factors. The Company concluded that the customer relationships Finite-Lived Intangible Assets have an estimated life of 12 years and are being amortized over this period on a straight-line basis. The value of Goodwill and Other Indefinite-lived Intangible Assets is assessed under either a qualitative or quantitative approach. Under a qualitative approach, the Company considers various market factors, including certain key assumptions, such as the market value of other airlines, fuel prices, the overall economy, passenger yields and changes to the regulatory environment. The Company analyzes these factors to determine if events and circumstances have affected the fair value of Goodwill and Other Indefinite-lived Intangible Assets. If it is determined that it is more likely than not that the asset may be impaired, the Company uses a quantitative approach to determine the reporting unit or intangible asset’s fair value incorporating the key assumptions listed below. An impairment charge is recorded for the amount of carrying value that exceeds the determined fair value as of the testing date. When the Company evaluates Goodwill or its Other Indefinite-Lived Intangible Assets for impairment using a quantitative approach, the Company utilizes market and income approach valuation techniques. These measurements include the following key assumptions, 1) forecasted revenues, expenses and cash flows, 2) current discount rates, 3) observable market transactions, and 4) anticipated changes to the regulatory environment. These assumptions are consistent with those that hypothetical market participants would use. Because the Company is required to make estimates and assumptions when evaluating Goodwill and Other Indefinite-Lived Intangible Assets for impairment, actual transaction amounts may differ materially from these estimates. The Company performed its most recent annual Goodwill and Other Indefinite-Lived Intangible Assets impairment analysis as of October 1, 2022. The Company did not recognize any impairment losses for the years ended December 31, 2022, 2021 or 2020. Income Taxes – Deferred income taxes are recognized for the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year end based on enacted tax laws and statutory tax rates applicable to the periods |
IMPACT OF THE COVID-19 PANDEMIC
IMPACT OF THE COVID-19 PANDEMIC | 12 Months Ended |
Dec. 31, 2022 | |
IMPACT OF THE COVID-19 PANDEMIC | |
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 decline in demand related to the COVID-19 pandemic, which caused a material decline in 2021 and 2020 revenues as compared to pre-pandemic levels, and negatively impacted the Company’s financial condition and operating results. During 2022, Sun Country continued to see recovery in demand from the COVID-19 pandemic relative to demand in 2021 and 2020, which may impact the comparability of results to prior periods. The ongoing impact of the COVID-19 pandemic virus and its variants on overall demand for future air travel remains uncertain and cannot be predicted at this time. CARES Act On March 27, 2020, the CARES Act was passed by the U.S. Government. The provisions in the CARES Act provided for economic relief to eligible individuals and businesses affected by COVID-19. As a provider of scheduled passenger service, air cargo service, charter air transportation and related services, the Company was eligible for and received certain benefits in 2021 and 2020, as outlined in the CARES Act including, but not limited to payroll tax breaks, government grants and government loans. The grant amounts recognized under the CARES Act Payroll Support Program for the years ended December 31, 2021 and 2020 were $71,587 and $62,312, respectively, and were recorded in Special Items, net in the Company’s Consolidated Statements of Operations. The CARES Act also provided an employee retention credit (“CARES Employee Retention Credit”) which was a refundable tax credit against certain employment taxes. During the years ended December 31, 2021 and 2020, the Company recorded a benefit of $848 and $2,328, respectively, related to the CARES Employee Retention Credit within Special Items, net in the Company's Consolidated Statements of Operations. Under the CARES Act Loan Program, the Company received a $45,000 loan (the “CARES Act Loan”) from the Treasury on October 26, 2020, which was repaid in full on March 24, 2021. In accordance with any grants and/or loans received under the CARES Act, the Company is required to comply with the relevant provisions of the CARES Act and the related implementing agreements which, among other things, include the following: the requirement to use the Payroll Support Payments exclusively for the continuation of payment of crewmember and employee wages, salaries and benefits; the requirement that certain levels of commercial air service be maintained through March 1, 2022, if ordered by the DOT; the prohibitions on share repurchases of listed securities and the payment of common stock (or equivalent) dividends ended on September 30, 2022; and restrictions on the payment of certain executive compensation effective through April 1, 2023. During the twelve months ended June 30, 2022, the compensation payable to an executive officer temporarily exceeded the limit under the CARES Act by $319. Once the issue was identified, the executive officer voluntarily rescinded the unvested portion of the equity grant that caused the executive’s compensation to exceed the CARES Act limit. At no point did the executive's cash compensation and equity awards that could be monetized exceed the CARES Act limit. The correction occurred subsequent to December 31, 2022. The Company did not accrue any amounts related to this matter as of December 31, 2022. To the extent we are deemed to have failed to remain in full compliance with the CARES Act and the applicable rules and regulations thereunder, we may become subject to fines or other enforcement actions. |
REVENUE
REVENUE | 12 Months Ended |
Dec. 31, 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 sold primarily to Scheduled service passengers, such as baggage fees, seat selection and upgrade fees, priority check-in and boarding fees, itinerary service fees and on-board sales. Cargo revenue is earned from flying cargo aircraft under the ATSA. Other revenue consists primarily of revenue from services in connection with Sun Country Vacations products and brand and marketing revenue from the Company's co-branded credit card program. The significant categories comprising Operating Revenues are as follows: Year Ended December 31, 2022 2021 2020 Scheduled service $ 438,308 $ 279,377 $ 193,047 Charter service 161,619 127,331 98,130 Ancillary 192,506 117,237 68,055 Passenger 792,433 523,945 359,232 Cargo 90,350 91,428 36,809 Other 11,661 7,642 5,445 Total Operating Revenue $ 894,444 $ 623,015 $ 401,486 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: Year Ended December 31, 2022 2021 2020 Domestic $ 857,764 $ 597,005 $ 382,463 Latin America 36,537 24,646 18,515 Other 143 1,364 508 Total Operating Revenue $ 894,444 $ 623,015 $ 401,486 Contract Balances The Company’s contract assets primarily relate to costs incurred in 2020 to get Amazon cargo aircraft ready for service. The balances are included in Other Current Assets and Other Assets on the Consolidated Balance Sheets. These deferred up-front costs are being amortized into expense on a pro-rata basis over the initial six years of the ATSA and are immaterial on an annual basis. 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 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 Consolidated Balance Sheets) and 3) the Amazon deferred up-front payment received (reported within Other Current Liabilities and Other Long-term Liabilities on the 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 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 and is immaterial on an annual basis. Contract Assets and Liabilities are as follows: December 31, 2022 2021 Contract Assets Costs to fulfill contract with Amazon $ 2,195 $ 2,819 Total Contract Assets $ 2,195 $ 2,819 Contract Liabilities Air Traffic Liabilities $ 157,995 $ 118,562 Loyalty Program Liabilities 15,437 19,718 Amazon Deferred Up-front Payment 3,271 4,200 Total Contract Liabilities $ 176,703 $ 142,480 The balance in the Air Traffic Liabilities fluctuates with seasonal travel patterns. Most tickets can be purchased no more than 12 months in advance, therefore any revenue associated with tickets sold for future travel will be recognized within that timeframe. For the year ended December 31, 2022, $112,347 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 co-branded credit 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 7,052 4,562 Loyalty Points Redeemed (1) (11,333) (6,913) Balance - December 31 $ 15,437 $ 19,718 ________________________________ (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 | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE The following table shows the computation of basic and diluted earnings (loss) per share: Year Ended December 31, 2022 2021 2020 Net Income (Loss) $ 17,676 $ 81,248 $ (3,904) Denominator: Weighted Average Common Shares Outstanding - Basic 57,951,955 55,182,811 46,806,042 Dilutive effect of Stock Options, RSUs and Warrants (1) 3,094,640 4,141,229 — Weighted Average Common Shares Outstanding - Diluted 61,046,595 59,324,040 46,806,042 Basic earnings (loss) per share $ 0.31 $ 1.47 $ (0.08) Diluted earnings (loss) per share $ 0.29 $ 1.37 $ (0.08) _________________________________ (1) There were 3,178,533, 3,636,771 and 3,577,252 performance-based stock options outstanding at December 31, 2022, 2021, and 2020, respectively. As of December 31, 2022 and 2021, the Company expected approximately 59% and 75% of these options to vest, respectively. As of December 31, 2022 32.5% of the eligible outstanding performance-based stock options vested and were considered exercisable. No amounts had vested as of December 31, 2021. These amounts are included in the measure above to the extent they are dilutive. |
AIRCRAFT
AIRCRAFT | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
AIRCRAFT | AIRCRAFT As of December 31, 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 years ended 2022 and 2021, respectively: December 31, 2021 Additions Reclassifications Removals December 31, 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 December 31, 2021 Passenger: Owned 14 1 6 — 21 Finance leases 5 4 — — 9 Operating leases 12 — (6) — 6 Sun Country Airlines' Fleet 31 5 — — 36 Cargo: Aircraft Operated for Amazon 12 — — — 12 Total Aircraft Operated 43 5 — — 48 (1) Two aircraft operating leases were reclassified into finance leases and two separate aircraft finance lease purchase options were exercised, resulting in a net change of zero finance lease reclassifications. During the year ended December 31, 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 December 31, 2022, 26 of the owned aircraft were financed and three aircraft were unencumbered. For more information on the Company's financing arrangements, see Note 8 of these Consolidated Financial Statements. During the year ended December 31, 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 year ended December 31, 2022, an owned aircraft was retired due to the aircraft sustaining damage beyond economic repair. The impact of the retirement was not material to the Company's Consolidated Results of Operations. See Note 18 for more information. Six of the aircraft purchased during the year ended December 31, 2021 were financed through the Delayed Draw Term Loan Facility. All six aircraft were previously accounted for as operating leases. The Company also acquired five incremental aircraft, one of which was purchased, and four through finance lease arrangements. Depreciation, amortization, and rent expense on aircraft is as follows: Year Ended December 31, Aircraft Status Expense Type 2022 2021 2020 Owned Depreciation $ 40,311 $ 35,855 $ 25,294 Finance Leased Amortization 16,871 11,507 13,253 Operating Leased Aircraft Rent (1) 8,768 17,653 30,989 $ 65,950 $ 65,015 $ 69,536 _________________________________ (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 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 deposit assets included in Short-term Lessor Maintenance Deposits on the Consolidated Balance Sheets. The assets represent deposits remitted by the previous owners of the Company to the lessor for maintenance events. The contra-asset 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 Consolidated Statements of Operations due to the fact that the previously acquired maintenance deposit is partially funding the maintenance event. As of December 31, 2022 and 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 year ended December 31, 2022, $8,362 is related to the purchase of two aircraft previously under operating leases. The contra-assets reduce future depreciation expense recognized on these aircraft. The remaining balance as of December 31, 2022 includes $8,021 that is available to be applied towards the purchase price of the two aircraft that were reclassified to finance leases during the current year. 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 December 31, 2022 and 2021 was $113 and $10,363, respectively and is recorded within Operating Lease Right-of-Use Assets. During fiscal year 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. The contra-assets were applied against the purchase price of the two aircraft previously under operating leases, which reduced the net cash outflows on the purchase date, and results in a reduction of future Depreciation and Amortization for the related aircrafts. 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 December 31, 2022 and 2021 was $2,574 and $14,737, respectively. Of the $12,163 reduction in the over-market maintenance reserve liabilities during fiscal year 2022, $6,023 was incorporated into the Finance Lease Assets in accordance with the terms of the two 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 reserves were applied against the purchase price of the two aircraft previously under operating leases, which reduced the net cash outflows on the purchase date, and results in a reduction of future Depreciation and Amortization for the related aircrafts. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | GOODWILL AND OTHER INTANGIBLE ASSETS Components of Goodwill and Other Intangible Assets were as follows: December 31, 2022 Gross Carrying Accumulated Net Carrying Goodwill $ 222,223 $ — $ 222,223 Intangible Assets with Finite Lives: Customer Relationships 48,000 (18,890) 29,110 Intangible Assets with Indefinite Lives: Tradename 56,000 — 56,000 Total Other Intangible Assets 104,000 (18,890) 85,110 Total Goodwill and Other Intangible Assets $ 326,223 $ (18,890) $ 307,333 December 31, 2021 Gross Carrying Accumulated Net Carrying Goodwill $ 222,223 $ — $ 222,223 Intangible Assets with Finite Lives: Customer Relationships 48,000 (14,890) 33,110 Intangible Assets with Indefinite Lives: Tradename 56,000 — 56,000 Total Other Intangible Assets 104,000 (14,890) 89,110 Total Goodwill and Other Intangible Assets $ 326,223 $ (14,890) $ 311,333 The Company recognized $4,000 of amortization expense on intangible assets with finite-lives during each of the years ended December 31, 2022, 2021 and 2020. As of December 31, 2022, estimated annual amortization expense for each of the next five fiscal years is $4,000 and $9,110 thereafter. |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 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 included a $25,000 Revolving Credit Facility and a $90,000 Delayed Draw Term Loan Facility ("DDTL"), which are collectively referred to as the “Credit Facilities". The interest rate on borrowings is determined by various alternative base rates plus an applicable margin ranging from 4% to 5%. In addition, there is a commitment fee on the unused Revolving Credit Facility of 0.5%. The proceeds from the Revolving Credit Facility can be used for general corporate purposes, whereas proceeds from the Delayed Draw Term Loan Facility 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 a minimum liquidity of $30,000 at the close of any business day. The Company was in compliance with these covenants as of December 31, 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 December 31, 2022. The Company recorded a $1,557 loss on extinguishment of debt related to the repayment of the DDTL, which represented the write-off of the unamortized deferred financing costs. As of December 31, 2022, the Company had $24,650 of financing available through the Revolving Credit Facility. Long-term Debt — 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 $2,570 in debt issuance costs associated with the 2022-1 EETC. Of the 13 aircraft financed by the 2022-1 EETC during the year ended December 31, 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 existing finance leases. 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. During the year ended December 31, 2022, the Company capitalized $3,074 of Interest Expense related to aircraft financed with the proceeds of the 2022-1 EETC while undergoing induction. 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 executed in 2020. The Company is required to make semi-annual principal and interest payments each June and December. These payments include interest through approximately the 15 th of the payment month. Long-term Debt includes the following: December 31, 2022 2021 Notes payable under the Company's 2019-1 EETC agreement dated December 2019, with original loan amounts of $248,587 payable in semi-annual installments, in June and December, through December 2027. These notes bear interest at an annual rate of between 4.13% and 6.95% and the weighted average interest rate is 4.73% as of December 31, 2022. $ 176,697 $ 202,984 Notes payable under the Company's 2022-1 EETC agreement dated March 2022, with a face amount of $188,277 payable in semi-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 December 31, 2022. 179,019 — Delayed Draw Term Loan Facility — 77,481 Other Notes payable — 466 Total Debt 355,716 280,931 Less: Unamortized debt issuance costs (3,481) (3,505) Less: Current Maturities of Long-term Debt (57,548) (29,412) Total Long-term Debt $ 294,687 $ 248,014 Future maturities of the outstanding Debt are as follows: December 31 Debt Principal Amortization of Debt Net Debt 2023 $ 58,518 $ (970) $ 57,548 2024 60,157 (785) 59,372 2025 65,241 (608) 64,633 2026 45,668 (420) 45,248 2027 47,999 (302) 47,697 Thereafter 78,133 (396) 77,737 Total $ 355,716 $ (3,481) $ 352,235 The fair value of Debt was $324,059 as of December 31, 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. |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Lessee, Operating Leases | LEASES The Company classifies its Leases into three categories: Aircraft, Real Estate, and Other. Aircraft leases consist of aircrafts, engines, and aircraft equipment under lease agreements. As of December 31, 2022, the Company had 13 leases for aircraft, of which 11 were under finance leases and two were right-of-use operating leases. Real estate leases consist of leased hangar and administration facilities, a simulator housing facility, and other leases consist of non-aircraft equipment under operating lease agreements. Real estate and other leases have initial terms of up to ten years. The Company’s Cargo fleet of 12 aircraft is subleased directly from Amazon and the Company operates them pursuant to the ATSA. Based upon review of the ATSA, the sublease arrangement does not qualify as a lease, because the Company does not control the use of the aircraft. As such, no right-of-use asset and lease liability is recognized in these financial statements for the Amazon arrangement. The Company also has various airport terminal agreements which include provisions for variable lease payments which are based on several factors, including, but not limited to, number of carriers, enplaned passengers, and airports’ annual operating budgets. Due to the variable nature of the rates, these leases are not recorded on the Company’s Consolidated Balance Sheets as a right-of-use asset and lease liability. Certain aircraft lease agreements include an option to extend the lease term beyond the original expiration date. As of December 31, 2022, the Company remains uncertain as to whether it will exercise any of the available extension options. As such, the Company’s operating and finance lease obligations do not reflect lease payments associated with extension periods that remain unexercised. Also, none of the Company’s aircraft leases contain an early termination provision. Certain aircraft lease agreements grant the Company the option to purchase the aircraft at the end of the lease term. To the extent the Company is reasonably certain to exercise the purchase option, the lease arrangement has been accounted for as a finance lease with the purchase option price recognized as part of the lease obligation. The following table summarizes the lease-related assets and liabilities recorded on the Company’s Consolidated Balance Sheets: December 31, Classification 2022 2021 Assets Finance lease assets, net Property and Equipment, net $ 221,727 $ 181,097 Operating lease assets Operating Lease Right-of-use Assets 22,182 61,658 Total lease assets $ 243,909 $ 242,755 Liabilities Current: Finance lease liabilities Short-term Finance Lease Obligations $ 17,990 $ 11,705 Operating lease liabilities Short-term Operating Lease Obligations 6,296 17,231 Long-term: Finance lease liabilities Long-term Finance Lease Obligations 233,306 180,450 Operating lease liabilities Long-term Operating Lease Obligations 19,836 58,810 Total lease liabilities $ 277,428 $ 268,196 The following table provides details of the Company’s obligations under Finance and Operating Leases as of December 31, 2022: Finance Leases Operating Leases Year Ending December 31 Aircraft Real Estate Total Aircraft Real Estate and Other Total 2023 $ 31,600 $ 1,492 $ 33,092 $ 4,382 $ 3,366 $ 7,748 2024 32,080 1,551 33,631 2,392 3,282 5,674 2025 32,080 1,773 33,853 — 3,273 3,273 2026 70,877 1,773 72,650 — 3,296 3,296 2027 20,604 1,773 22,377 — 3,306 3,306 Thereafter 122,527 3,179 125,706 — 8,722 8,722 Total Minimum Lease Payments 309,768 11,541 321,309 6,774 25,245 32,019 Less: Amount Representing Interest (66,652) (3,361) (70,013) (316) (5,571) (5,887) Present Value of Minimum Lease Payments 243,116 8,180 251,296 6,458 19,674 26,132 Less: Short-term Obligations (17,309) (681) (17,990) (4,111) (2,185) (6,296) Long-term Lease Obligations $ 225,807 $ 7,499 $ 233,306 $ 2,347 $ 17,489 $ 19,836 The following table presents lease costs related to the Company’s Finance and Operating Leases: Year Ended December 31, Classification 2022 2021 2020 Finance lease cost Amortization of leased assets Depreciation and Amortization $ 17,900 $ 12,536 $ 11,948 Interest on lease liabilities Interest Expense 13,782 8,021 8,659 Operating lease cost Included in ROU asset - Aircraft Aircraft Rent (1) 8,465 18,608 30,717 Included in ROU asset - Real Estate & Other Ground Handling, Landing Fees and Airport Rent & Other Operating 3,692 3,976 4,872 Short-term Aircraft Rent 691 277 1,813 Variable - Aircraft Aircraft Rent (1) (388) (1,232) (1,541) Variable - Other Landing Fees & Airport Rentals 1,838 1,210 1,049 Total Lease cost $ 45,980 $ 43,396 $ 57,517 _________________________________ (1) The years ended December 31, 2022, 2021 and 2020, include credits of $3,228, $7,609 and $14,110, respectively, for the amortization of Over-market Liabilities established at the Acquisition Date related to lease rates and maintenance reserves. The following table presents Supplemental cash flow information related to leases, included in the Consolidated Statements of Cash Flows: Year Ended December 31, 2022 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating Cash Flows for Operating Leases $ 12,378 $ 29,360 $ 34,576 Operating Cash Flows for Finance Leases $ 13,782 $ 8,021 $ 8,659 Financing Cash Flows for Finance Leases $ 42,062 $ 11,931 $ 89,697 The table below presents lease-related terms and discount rates related to the Company’s Finance and Operating Leases: Year Ended December 31, 2022 2021 2020 Weighted-average remaining lease term Operating Leases 5.9 years 4.6 years 4.8 years Finance Leases 6.1 years 7.2 years 8.6 years Weighted-average discount rates Operating Leases 6.3% 6.0% 6.0% Finance Leases 6.2% 6.1% 6.1% During the years ended December 31, 2022, 2021, and 2020 the Company expensed $2,191, $4,004 and $8,691 of maintenance reserve payments, respectively. These expenses are reflected in Aircraft Rent on the accompanying Consolidated Statements of Operations. |
Lessee, Finance Leases | LEASES The Company classifies its Leases into three categories: Aircraft, Real Estate, and Other. Aircraft leases consist of aircrafts, engines, and aircraft equipment under lease agreements. As of December 31, 2022, the Company had 13 leases for aircraft, of which 11 were under finance leases and two were right-of-use operating leases. Real estate leases consist of leased hangar and administration facilities, a simulator housing facility, and other leases consist of non-aircraft equipment under operating lease agreements. Real estate and other leases have initial terms of up to ten years. The Company’s Cargo fleet of 12 aircraft is subleased directly from Amazon and the Company operates them pursuant to the ATSA. Based upon review of the ATSA, the sublease arrangement does not qualify as a lease, because the Company does not control the use of the aircraft. As such, no right-of-use asset and lease liability is recognized in these financial statements for the Amazon arrangement. The Company also has various airport terminal agreements which include provisions for variable lease payments which are based on several factors, including, but not limited to, number of carriers, enplaned passengers, and airports’ annual operating budgets. Due to the variable nature of the rates, these leases are not recorded on the Company’s Consolidated Balance Sheets as a right-of-use asset and lease liability. Certain aircraft lease agreements include an option to extend the lease term beyond the original expiration date. As of December 31, 2022, the Company remains uncertain as to whether it will exercise any of the available extension options. As such, the Company’s operating and finance lease obligations do not reflect lease payments associated with extension periods that remain unexercised. Also, none of the Company’s aircraft leases contain an early termination provision. Certain aircraft lease agreements grant the Company the option to purchase the aircraft at the end of the lease term. To the extent the Company is reasonably certain to exercise the purchase option, the lease arrangement has been accounted for as a finance lease with the purchase option price recognized as part of the lease obligation. The following table summarizes the lease-related assets and liabilities recorded on the Company’s Consolidated Balance Sheets: December 31, Classification 2022 2021 Assets Finance lease assets, net Property and Equipment, net $ 221,727 $ 181,097 Operating lease assets Operating Lease Right-of-use Assets 22,182 61,658 Total lease assets $ 243,909 $ 242,755 Liabilities Current: Finance lease liabilities Short-term Finance Lease Obligations $ 17,990 $ 11,705 Operating lease liabilities Short-term Operating Lease Obligations 6,296 17,231 Long-term: Finance lease liabilities Long-term Finance Lease Obligations 233,306 180,450 Operating lease liabilities Long-term Operating Lease Obligations 19,836 58,810 Total lease liabilities $ 277,428 $ 268,196 The following table provides details of the Company’s obligations under Finance and Operating Leases as of December 31, 2022: Finance Leases Operating Leases Year Ending December 31 Aircraft Real Estate Total Aircraft Real Estate and Other Total 2023 $ 31,600 $ 1,492 $ 33,092 $ 4,382 $ 3,366 $ 7,748 2024 32,080 1,551 33,631 2,392 3,282 5,674 2025 32,080 1,773 33,853 — 3,273 3,273 2026 70,877 1,773 72,650 — 3,296 3,296 2027 20,604 1,773 22,377 — 3,306 3,306 Thereafter 122,527 3,179 125,706 — 8,722 8,722 Total Minimum Lease Payments 309,768 11,541 321,309 6,774 25,245 32,019 Less: Amount Representing Interest (66,652) (3,361) (70,013) (316) (5,571) (5,887) Present Value of Minimum Lease Payments 243,116 8,180 251,296 6,458 19,674 26,132 Less: Short-term Obligations (17,309) (681) (17,990) (4,111) (2,185) (6,296) Long-term Lease Obligations $ 225,807 $ 7,499 $ 233,306 $ 2,347 $ 17,489 $ 19,836 The following table presents lease costs related to the Company’s Finance and Operating Leases: Year Ended December 31, Classification 2022 2021 2020 Finance lease cost Amortization of leased assets Depreciation and Amortization $ 17,900 $ 12,536 $ 11,948 Interest on lease liabilities Interest Expense 13,782 8,021 8,659 Operating lease cost Included in ROU asset - Aircraft Aircraft Rent (1) 8,465 18,608 30,717 Included in ROU asset - Real Estate & Other Ground Handling, Landing Fees and Airport Rent & Other Operating 3,692 3,976 4,872 Short-term Aircraft Rent 691 277 1,813 Variable - Aircraft Aircraft Rent (1) (388) (1,232) (1,541) Variable - Other Landing Fees & Airport Rentals 1,838 1,210 1,049 Total Lease cost $ 45,980 $ 43,396 $ 57,517 _________________________________ (1) The years ended December 31, 2022, 2021 and 2020, include credits of $3,228, $7,609 and $14,110, respectively, for the amortization of Over-market Liabilities established at the Acquisition Date related to lease rates and maintenance reserves. The following table presents Supplemental cash flow information related to leases, included in the Consolidated Statements of Cash Flows: Year Ended December 31, 2022 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating Cash Flows for Operating Leases $ 12,378 $ 29,360 $ 34,576 Operating Cash Flows for Finance Leases $ 13,782 $ 8,021 $ 8,659 Financing Cash Flows for Finance Leases $ 42,062 $ 11,931 $ 89,697 The table below presents lease-related terms and discount rates related to the Company’s Finance and Operating Leases: Year Ended December 31, 2022 2021 2020 Weighted-average remaining lease term Operating Leases 5.9 years 4.6 years 4.8 years Finance Leases 6.1 years 7.2 years 8.6 years Weighted-average discount rates Operating Leases 6.3% 6.0% 6.0% Finance Leases 6.2% 6.1% 6.1% During the years ended December 31, 2022, 2021, and 2020 the Company expensed $2,191, $4,004 and $8,691 of maintenance reserve payments, respectively. These expenses are reflected in Aircraft Rent on the accompanying Consolidated Statements of Operations. |
STOCK BASED COMPENSATION
STOCK BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2022 | |
Compensation Related Costs [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION In March 2021, the stockholders approved the Sun Country Airlines Holdings, Inc. 2021 Omnibus Incentive Plan (the “Plan”). The Plan authorizes that no more than 3,600,000 shares of Common Stock may be delivered in the aggregate pursuant to Awards granted under the Plan. An “Award” means any Incentive Stock Option, Nonqualified Stock Option, Stock Appreciation Right, Restricted Stock, RSU, Other Stock-Based Award, or Other Cash-Based Award granted under the Plan. As of December 31, 2022, there were 3,276,169 shares available for future grants. Upon implementation of this new Plan, grants under the October 2018 equity incentive plan ceased. Awards already issued under the 2018 plan are not impacted by the new Plan. Stock compensation expense was $2,774, $5,562, and $2,110 during the years ended December 31, 2022, 2021 and 2020, respectively. During the years ended December 31, 2022 and 2021 there was a $1,032 and $3,619 tax benefit recognized in income related to stock compensation expense. The 2021 expense includes $3,804 for performance-based options, which were expensed for the first time in 2021 due to the achievement of a performance condition. As of December 31, 2022, there was $4,583 of total unrecognized compensation expense related to stock options and RSUs. This unrecognized compensation is expected to be fully recognized over a weighted average period of approximately 2.2 years. Time-Based Stock Options The following table is a summary of the Company's time-based stock option activity: Time-Based Stock Options Number of Weighted Weighted Weighted Aggregate Intrinsic Value (in thousands) Outstanding as of December 31, 2019 2,281,308 $ 5.84 $ 2.54 9.0 Granted 221,941 17.99 7.02 Forfeited (173,788) 14.65 5.70 Outstanding as of December 31, 2020 2,329,461 $ 6.36 $ 2.74 7.6 Granted 62,080 33.10 13.47 Forfeited (18,613) 11.75 5.15 Exercised (718,985) 5.89 2.56 Outstanding as of December 31, 2021 1,653,943 $ 7.57 $ 3.22 7.2 Granted — — — Forfeited (119,605) 20.09 8.03 Exercised (177,816) 5.63 2.49 Outstanding as of December 31, 2022 1,356,522 $ 6.72 $ 2.89 6.1 $ 12,950 Exercisable as of December 31, 2022 1,214,803 $ 6.12 $ 2.65 $ 12,084 Vested or expected to vest, December 31, 2022 1,356,522 $ 6.72 $ 2.89 $ 12,950 The Company recognizes expense associated with the Time-Based Stock Options in an amount equal to the fair value on the date of the grant and on a straight-line basis over the requisite service period of the award (generally the vesting period). Time-based stock option awards vest at 25% per year over the first four years following the grant. All time-based stock options expire ten years after the grant date. The intrinsic value of stock options exercised in 2022 and 2021 was $3,468 and $18,621, respectively. The fair value of the time-based stock options granted was estimated using the Black-Scholes option-pricing model with the following weighted-average assumptions used for grants. A third-party valuation advisor was utilized to assist management in determining the fair value of options granted using the Black-Scholes option-pricing model based on the grant price and assumptions regarding the expected term, expected volatility, dividends, and risk-free interest rates. The grant price was determined based on the fair value of the Company’s stock on the date the Compensation Committee of the Board approves the grant. During the year ended December 31, 2022, the Company did not grant any time-based stock options. The assumptions used for the Black-Scholes option pricing model were as follows: 2021 2020 Expected Term 5.1 years 5.6 years Expected Volatility 34.0 % 38.8 % Risk-free Interest Rate 1.2 % 1.7 % Expected Dividend Yield — — The expected term was based on vesting criteria and time to expiration. The expected volatility was based on historical volatility of stock prices and assets of a public company peer group. The risk-free interest rate was based on the implied risk-free rate using the expected term and yields of U.S Treasury stock and S&P bond yields. Performance-Based Stock Options The following table is a summary of the Company's performance-based stock option activity: Performance-Based Stock Options Number of Weighted Weighted Weighted Aggregate Intrinsic Value (in thousands) Outstanding as of December 31, 2019 3,502,947 $ 5.86 $ 1.61 9.0 Granted 346,984 17.99 4.36 Forfeited (272,679) 14.65 3.59 Outstanding as of December 31, 2020 3,577,252 $ 6.38 $ 1.72 7.6 Granted 99,167 33.10 10.08 Forfeited (39,648) 6.89 1.67 Outstanding as of December 31, 2021 3,636,771 $ 7.10 $ 1.53 7.2 Granted — — — Forfeited (307,894) 14.13 4.43 Exercised (150,344) 6.55 1.74 Outstanding as of December 31, 2022 3,178,533 $ 6.45 $ 1.83 6.1 $ 30,793 Exercisable as of December 31, 2022 964,635 $ 6.64 $ 1.93 $ 9,322 Vested or expected to vest, December 31, 2022 (1) 1,888,049 $ 6.45 $ 1.83 $ 18,291 _________________________________ (1) As of December 31, 2022, the Company expected approximately 59% of these options to vest. The vesting for the Company's performance-based stock options was based on the Company's IPO and other ongoing factors. The Company recognized a cumulative catch-up of stock-based compensation expense upon the Company's IPO. The Company continues to measure the ongoing factors and the impact on vesting. Compensation expense for the performance-based stock options is recognized ratably for each vesting tranche. The service period for these awards is from the original grant date through each of the future vesting dates. The intrinsic value of performance-based stock options exercised in 2022 was $2,511. There were no exercises of performance-based stock options during 2021 or 2020. All performance-based stock options expire ten years after the grant date. The fair value of performance-based stock options granted was estimated by simulating the future stock price using geometric Brownian motion and risk-free rate of return at intervals specified in the grant agreement. The number of shares vested and future price at each interval were recorded for each simulation and then multiplied together and discounted to present value at the risk-free rate of return. During the year ended December 31, 2022, the Company did not grant any performance-based stock options. Time-Based RSUs Restricted Stock Units Number of Weighted Outstanding as of December 31, 2020 — $ — Granted 7,634 40.60 Forfeited (2,955) 40.60 Outstanding as of December 31, 2021 4,679 40.60 Granted 248,025 20.44 Forfeited (5,478) 23.04 Vested (17,035) 25.87 Outstanding as of December 31, 2022 230,191 $ 20.39 |
DEFINED CONTRIBUTION 401(k) PLA
DEFINED CONTRIBUTION 401(k) PLAN | 12 Months Ended |
Dec. 31, 2022 | |
Retirement Benefits [Abstract] | |
DEFINED CONTRIBUTION 401(k) PLAN | DEFINED CONTRIBUTION 401(k) PLAN The Company has a 401(k) profit-sharing retirement plan covering substantially all employees. The plan allows employee contributions up to 50% of a participant’s eligible compensation, subject to limits established under the 401(k) plan and annual IRS elective deferral limits. The Company currently matches 100% of participants contribution up to a maximum of 4% for non-pilot participants’ and 6% for pilot participants’ eligible compensation. Pursuant to the current pilot collective bargaining agreement, the Company was also required to make a non-discretionary 13% Company contribution for pilots based on gross earnings. This non-discretionary Company contribution for pilots will increase to 14% in 2023, and 15% for 2024 and thereafter. Contributions are classified in Salaries, Wages, and Benefits on the Consolidated Statements of Operations. The Company made 401(k) contributions as follows: Year Ended December 31, 2022 2021 2020 Non-Discretionary $ 13,692 $ 1,187 $ 1,040 Discretionary 2,730 5,220 4,263 Total 401(k) Contributions $ 16,422 $ 6,407 $ 5,303 |
FUEL DERIVATIVES AND RISK MANAG
FUEL DERIVATIVES AND RISK MANAGEMENT | 12 Months Ended |
Dec. 31, 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 December 31, 2022 and 2021, the Company had no outstanding fuel derivative contracts. Fuel derivative contracts are recognized at fair value on the 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 Consolidated Statements of Operations. Changes in Derivative Assets (Liabilities) are as follows: December 31, 2022 2021 Balance - January 1 $ — $ (1,174) Non-cash Gains — 3,527 Contract Settlements — (2,353) Balance - December 31 $ — $ — Fuel Derivative Gains (Losses) consist of the following: Year Ended December 31, 2022 2021 2020 Non-cash Gains (Losses) $ — $ 3,527 $ (12,206) Cash Premiums Paid — — (2,053) Total Fuel Derivative Gains (Losses) $ — $ 3,527 $ (14,259) |
INVESTMENTS
INVESTMENTS | 12 Months Ended |
Dec. 31, 2022 | |
Investments, Debt and Equity Securities [Abstract] | |
INVESTMENTS | INVESTMENTS A summary of the Company's Available-for-Sale debt securities by major security type is as follows: December 31, 2022 (1) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-Sale Securities (2) : Municipal Debt Securities $ 47,897 $ 16 $ (258) $ 47,655 Corporate Debt Securities 93,460 1 (683) 92,778 U.S. Government Agency Securities 32,326 2 (126) 32,202 Total $ 173,683 $ 19 $ (1,067) $ 172,635 (1) As the Company purchased these investments during 2022; therefore, there is no comparable presentation for prior periods. (2) The Company also holds Certificates of Deposit that are included in Investments on the Consolidated Balance Sheets totaling $6,301 and $6,283 as of December 31, 2022 and December 31, 2021, respectively. As of December 31, 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 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Accounting standards define fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The standards also establish a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Under GAAP, there are three levels of inputs that may be used to measure fair value: Level 1 - Quoted prices for identical assets or liabilities in active markets. Level 2 - Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company uses the following valuation methodologies for financial instruments measured at fair value on a recurring basis. 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 8 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: December 31, 2022 Level 1 Level 2 Level 3 Total Cash & Cash Equivalents $ 73,727 $ 18,359 $ — $ 92,086 Available-for-Sale Securities: Municipal Debt Securities — 47,655 — 47,655 Corporate Debt Securities — 92,778 — 92,778 U.S. Government Agency Securities — 32,202 — 32,202 Total Available-for-Sale Securities — 172,635 — 172,635 Total Assets Measured at Fair Value on a Recurring Basis $ 73,727 $ 190,994 $ — $ 264,721 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 | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The following table summarizes the significant components of the provision for income taxes from continuing operations: Year Ended December 31, 2022 2021 2020 Current: Federal $ 1,329 $ — $ — State and Local 84 135 10 Total Current Tax Expense 1,413 135 10 Deferred: Federal 4,393 16,824 (597) State and Local 500 2,123 (191) Total Deferred Tax Expense (Benefit) 4,893 18,947 (788) Total Income Tax Expense (Benefit) $ 6,306 $ 19,082 $ (778) The income tax provision differs from that computed at the federal statutory corporate tax rate as follows: Year Ended December 31, 2022 2021 2020 Expected Provision at Federal Statutory Tax Rate 21.0 % 21.0 % 21.0 % State Tax, net of Federal Impact 1.9 % 1.8 % 3.1 % Stock Compensation Benefit (4.3) % (3.6) % — % Tax Receivable Agreement 4.4 % (3.4) % — % Executive Compensation Limitation 2.0 % 3.0 % — % Employee Parking 0.9 % 0.2 % (3.3) % Meals and Entertainment — % — % (2.2) % Other Permanent Adjustments 0.4 % — % (2.0) % Effective Tax Rate 26.3 % 19.0 % 16.6 % The following table summarizes the significant components of the Company’s deferred taxes: December 31, 2022 2021 Deferred Tax Assets: Net Operating Loss $ 73,252 $ 77,920 Operating Lease Obligations 5,179 16,544 Finance Lease Obligations 34,458 40,178 Goodwill and Other Intangible Assets 6,812 9,699 Loyalty Program Liabilities 3,459 4,407 Accrued Maintenance — 718 Other 7,028 5,095 Total Deferred Tax Assets 130,188 154,561 Deferred Tax Liabilities: Accelerated Depreciation (78,749) (81,120) Operating Lease Right-of-use Assets (5,102) (14,181) Finance Lease Assets (30,492) (41,652) Prepaid Maintenance (1,986) — Other (903) — Total Deferred Tax Liabilities (117,232) (136,953) Total Net Deferred Tax Assets $ 12,956 $ 17,608 As of December 31, 2022, the Company has $70,551 of federal net operating losses ("NOLs") and $2,701 of state NOLs, net of tax effect, available that may be applied against future tax liabilities. As a result of ownership changes that occurred in 2021, the existing federal and state NOLs may be subject to certain limitations under Section 382 of the Internal Revenue Code. However, the Company does not believe these limitations will adversely impact its ability to use these losses to offset taxable income in future periods. There is no expiration of federal net operating losses. The state net operating losses begin to expire in 2025. In assessing the realizability of Deferred Tax Assets, management considers whether it is more likely than not that some portion or all the Deferred Tax Assets will not be realized. The ultimate realization of the Deferred Tax Assets is dependent upon the generation of future taxable income during periods in which the temporary differences become deductible. Management considers the scheduled reversal of the liabilities (including the impact of available carryback and carryforward periods), projected future taxable income, and tax-planning strategies in making this assessment. As of December 31, 2022, management believes that it is more likely than not that the future results of the operations will generate sufficient taxable income to realize the tax benefits related to its Deferred Tax Assets. The Company recognizes the consolidated financial statement effect of a tax position when it is more likely than not, based on the technical merits, that the position will be sustained upon examination. If applicable, the Company reports both accrued interest and penalties related to unrecognized tax benefits as a component of Income Tax Expense in the Consolidated Statements of Operations. As of December 31, 2022 and 2021, the Company had no liability for unrecognized tax benefits recorded in its Consolidated Balance Sheets. The Company files income tax returns in the United States and various states. In the normal course of business, the Company is subject to potential income tax examination by the federal and state tax authorities in these jurisdictions for tax years that are open under local statute. For U.S. federal income tax purposes, the Company's 2021, 2020, and 2019 tax returns remain open to examination. For U.S. state income tax purposes, the Company's 2021, 2020, 2019, and 2018 tax returns remain open to examination. Tax Receivable Agreement In connection with the Company’s IPO, the Company entered into a TRA with 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 is 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, 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, with an offset to Stockholders’ Equity. Adjustments to the TRA are recorded in Other, net Non-Operating Income (Expense) on the Company's Consolidated Statements of Operations. If the Company does not generate sufficient taxable income in the aggregate over the term of the TRA to utilize the tax benefits, then it would not be required to make the related TRA payments. During fiscal year 2022, the TRA liability balance increased $5,000 from $98,800 to $103,800. The increase in the TRA liability was recorded as an expense within the Consolidated Statement of Operations. The 2022 increase in the TRA liability was mainly due to the reduction in the 2022 actual pre-tax income compared to the forecasted pre-tax income. During the year ended December 31, 2021, the TRA Liability decreased by $16,400, which was recorded as a benefit within the Consolidated Statement of Operations. The decrease in the TRA liability was mainly due to the receipt of an additional CARES Act grant in 2021, which extended the time period in which distributions made to shareholders are restricted from March 31, 2022 to September 30, 2022, and also resulted from an increase in 2021 pre-tax income. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | STOCKHOLDERS’ EQUITYOn 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. During the fourth quarter of 2022, the Company entered into a $25,000 Accelerated Share Repurchase Program. The Company received an initial delivery of 890,586 shares at an average price of $19.65 per share during the fourth quarter of 2022. The settlement of the program occurred during January 2023, upon which the Company received an additional 480,932 shares. In total, the Company repurchased 1,371,518 shares at an average price of $18.23 per share. As of December 31, 2022, the Company had $25,000 of Board authorization remaining to repurchase additional shares of its Common Stock. The stock repurchase program has no expiration date and may be modified, suspended, or terminated at any time. |
SPECIAL ITEMS, NET
SPECIAL ITEMS, NET | 12 Months Ended |
Dec. 31, 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 Consolidated Statements of Operations consist of the following: Year Ended December 31, 2022 2021 2020 CARES Act grant recognition (see Note 3 ) $ — $ (71,587) $ (62,312) CARES Act employee retention credit (see Note 3 ) — (848) (2,328) Other (1) — 16 77 Total Special Items, net $ — $ (72,419) $ (64,563) (1) The 2021 and 2020 costs were related to relocation of flight attendant bases due to the closure of the Portland and Las Vegas bases. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 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 (see Note 9 ), repayment of debt (see Note 8 ), payments under the TRA (see N ote 1 5 ), 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, the estimate has since been revised. The impact of the retirement was not material to the Company's Consolidated Results of Operations. The estimate will continue to 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 Consolidated Results of Operations. As of December 31, 2022 the Company had a commitment to lease three aircraft with deliveries spanning the fourth quarter of 2023 and the first quarter of 2024. The leases will each have annual lease payments of approximately $2,000 for six years. As of December 31, 2022 the Company had a commitment to purchase an engine for approximately $4,500. The engine was purchased and delivered in January 2023. 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 | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
OPERATING SEGMENTS | OPERATING SEGMENTSOperating segments are defined as components of an enterprise about which separate financial information is both available and evaluated regularly by the Chief Operating Decision Maker ("CODM") and is used in resource allocation and performance assessments. The Company’s CODM is considered to be the Company’s Chief Executive Officer. The CODM makes resource allocation decisions to maximize the Company's consolidated financial results, primarily through the scheduling of aircraft on the most profitable routes. Substantially all the Company’s tangible assets are located in the U.S. or relate to flight equipment, which is mobile across geographic markets. The Company has two operating and reportable segments: Passenger and Cargo. The Company’s Passenger segment is comprised of two businesses: Scheduled Service and Charter. These businesses both utilize the Company's Passenger fleet. The CODM maximizes the return on these aircraft through the combination of both the Scheduled Service and Charter flights. The Company routinely schedules its Passenger fleet using what is referred to as “ Power Patterns ,” which involves scheduling aircraft and crew on trips that combine scheduled service and charter legs, dynamically replacing what would be lower margin scheduled service flights with charter opportunities. Because of the complimentary nature of these businesses and the fact that the CODM routinely looks at the combined results of these businesses to ensure the highest level of returns on the Passenger fleet, the Company determined that it was appropriate that these businesses be viewed as a singular Passenger operating segment. The Cargo segment began providing air cargo services under the ATSA in May 2020. Fuel consumed in Cargo operations is directly reimbursed by Amazon and therefore aircraft fuel revenue is presented net of such reimbursements on the Consolidated Statements of Operations. Fuel consumed in Cargo maintenance activities is included within Aircraft Fuel expense in the Cargo segment. Certain operating expenses are directly attributable to the Cargo operating segment. Certain operating expenses are allocated between the operating segments. Non-Fuel operating expenses are allocated based on metrics such as block hours, fleet count and departures, which best align with the nature of the respective expense. CARES Act credits, included in Special Items, net, are allocated based on the respective segment Salaries, Wages, and Benefits. The following tables present financial information for the Company’s two segments. Assets by segment are not reviewed by the CODM and have not been presented herein. The Company does not consider Interest Income, Interest Expense, and Other Income, net, in assessing the financial performance of its operating segments. Collectively, these items are included in reconciliations of reporting segment financial amounts to consolidated financial amounts. Year Ended December 31, 2022 Passenger Cargo Consolidated Operating Revenues $ 804,094 $ 90,350 $ 894,444 Non-Fuel Operating Expenses 479,968 90,405 570,373 Aircraft Fuel 268,279 84 268,363 Total Operating Expenses 748,247 90,489 838,736 Operating Income (Loss) $ 55,847 $ (139) 55,708 Interest Income 4,527 Interest Expense (31,018) Other, net (5,235) Income before Income Tax $ 23,982 Year Ended December 31, 2021 Passenger Cargo Consolidated Operating Revenues $ 531,587 $ 91,428 $ 623,015 Non-Fuel Operating Expenses 385,580 68,797 454,377 Aircraft Fuel 128,863 247 129,110 Special Items, net (54,019) (18,400) (72,419) Total Operating Expenses 460,424 50,644 511,068 Operating Income $ 71,163 $ 40,784 $ 111,947 Interest Income 85 Interest Expense (26,326) Other, net 14,624 Income before Income Tax $ 100,330 Year Ended December 31, 2020 (1) Passenger Cargo Consolidated Operating Revenues $ 364,677 $ 36,809 $ 401,486 Non-Fuel Operating Expenses 332,742 32,530 365,272 Aircraft Fuel 83,392 — 83,392 Special Items, net (53,842) (10,721) (64,563) Total Operating Expenses 362,292 21,809 384,101 Operating Income $ 2,385 $ 15,000 $ 17,385 Interest Income 377 Interest Expense (22,073) Other, net (371) Loss before Income Tax $ (4,682) (1) As air cargo operations commenced in May 2020, there are limited Cargo amounts included in the year ended December 31, 2020. |
PARENT COMPANY FINANCIAL STATEM
PARENT COMPANY FINANCIAL STATEMENTS | 12 Months Ended |
Dec. 31, 2022 | |
Condensed Financial Information Disclosure [Abstract] | |
PARENT COMPANY FINANCIAL STATEMENTS | PARENT COMPANY FINANCIAL STATEMENTS Basis of Presentation These Condensed Parent Company-only Financial Statements are not general-purpose financial statements and should be read in conjunction with the Consolidated Financial Statements. The Parent’s significant accounting policies are consistent with those described in the Consolidated Financial Statements, except that all subsidiaries are accounted for as equity method investments. Revision of Previously Issued Parent Company Financial Information During the second quarter of 2022, the Company identified an immaterial misstatement in its Consolidated Financial Statements for the year ended December 31, 2021 (the "previously issued financial statements"). 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 Parent Company-only Financial Statements and notes included in this Annual Report on Form 10-K. For further information regarding the revision, refer to Note 2 of these Consolidated Financial Statements. The impact of the revision on the Company's previously issued Condensed Parent Company-only Balance Sheets as of December 31, 2021 are as follows: December 31, 2021 As Previously Issued Correction As Revised Assets Investment in Subsidiary $ 602,561 $ 3,778 $ 606,339 Total Other Assets 602,561 3,778 606,339 Total Assets 602,561 3,778 606,339 Stockholders' Equity Retained Earnings 115,794 3,778 119,572 Total Stockholders' Equity 602,011 3,778 605,789 Total Liabilities and Stockholders' Equity $ 602,561 $ 3,778 $ 606,339 The impact of the revision on the Company's previously issued Condensed Parent Company-only Statements of Operations for the year ended December 31, 2021 are as follows: Year Ended December 31, 2021 As Previously Issued Correction As Revised Operating Expenses Equity in Income of Subsidiaries $ 77,534 $ 3,778 $ 81,312 Total Non-operating Income, net 77,534 3,778 81,312 Income Before Income Tax 77,470 3,778 81,248 Net Income $ 77,470 $ 3,778 $ 81,248 The following Condensed Parent Company-only Financial Statements are presented to show only the parent company, Sun Country Airlines Holdings, Inc. Balance Sheets December 31, 2022 2021 ASSETS Current Assets: Cash and Cash Equivalents $ — $ — Total Current Assets — — Other Assets: Investment in Subsidiary 609,396 606,339 Total Other Assets 609,396 606,339 Total Assets $ 609,396 $ 606,339 December 31, 2022 2021 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts Payable $ — $ (1) Other Current Liabilities 16 57 Total Current Liabilities 16 56 Other Long-term Liabilities 1,468 494 Total Liabilities 1,484 550 Stockholders' Equity: Common Stock 582 579 Treasury Stock (17,605) — Additional Paid In Capital 488,494 485,638 Accumulated Other Comprehensive Income (807) — Retained Earnings 137,248 119,572 Total Stockholders' Equity 607,912 605,789 Total Liabilities and Stockholders' Equity $ 609,396 $ 606,339 Statements of Operations Year Ended December 31, 2022 2021 2020 Operating Expenses: Other Operating, net $ 465 $ 64 $ 179 Total Operating Expenses 465 64 179 Operating Loss (465) (64) (179) Non-operating Income (Expense): Equity in Income (Loss) of Subsidiaries 18,141 81,312 (3,725) Other, net — — — Total Non-operating Income (Expense), net 18,141 81,312 (3,725) Income (Loss) before Income Tax 17,676 81,248 (3,904) Income Tax Expense (Benefit) — — — Net Income (Loss) 17,676 81,248 (3,904) Other Comprehensive Loss (807) — — Comprehensive Income (Loss) $ 16,869 $ 81,248 $ (3,904) A Statement of Cash Flows has not been presented as Sun Country Airlines Holdings, Inc. did not have material cash transactions for the years ended December 31, 2022, 2021, and 2020. Further, Sun Country Airlines Holdings, Inc. did not have material cash balances as of December 31, 2022 and 2021. All cash transactions involving Sun Country Airlines Holdings, Inc. are performed at the subsidiary level. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS The Company evaluated subsequent events for the period from the Balance Sheet date through February 15, 2023, the date that the Consolidated Financial Statements were available to be issued. For more information on the Company's subsequent events, see Note 2 , N ote 3 , Note 16 , and Note 18 within these Consolidated Financial Statements. |
BASIS OF PRESENTATION AND SUM_2
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Principles of Consolidation | Principles of Consolidation – The consolidated financial statements include the accounts of Sun Country Airlines Holdings, Inc. and its subsidiaries and have been prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). All material intercompany balances and transactions have been eliminated in consolidation. |
Fiscal Year | The Company operates its fiscal year on a calendar year basis. |
Use of Estimates | Use of Estimates – The preparation of financial statements in conformity with GAAP requires management to make 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 and the reported amounts of revenues and expenses during the reporting periods. 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. |
Revenue Recognition | Revenue Recognition – Scheduled passenger service, charter service, and most ancillary revenues are recognized when the passenger flight occurs. Revenues exclude amounts collected on behalf of other parties, including transportation taxes. Scheduled Service. The Company initially defers ticket sales as an Air Traffic Liability and recognizes revenue when the passenger flight occurs. Unused non-refundable tickets expire at the date of scheduled travel and are recorded as revenue unless the customer notifies the Company in advance of such date that the customer will not travel. If notification is made, a travel credit is created for the face value less applicable change fees. Travel credits may generally be redeemed toward future travel for up to 12 months after the date of the original booking. Therefore, these credits are recorded as a current liability on the Company's Consolidated Balance Sheets. The Company records an estimate for travel credits that will expire unused, otherwise known as breakage, in Passenger Revenue upon issuance of the travel credit. The estimated breakage rate is primarily based on historical experience of travel credit activity and other factors that may not be indicative of future trends, such as the COVID-19 pandemic, program changes or modifications that could affect the ultimate usage patterns of tickets and travel credits. The Company continuously monitors its breakage rate assumptions and may adjust its estimated breakage rate in the future. Changes in the Company’s estimated breakage rate impacts revenue recognition prospectively. The Company currently accounts for direct selling costs, including credit card fees, and commissions, in accordance with the terms of each service. The expense is deferred and recognized when the travel occurs. Ancillary. Ancillary revenue consists primarily of revenue generated from air travel-related services such as baggage fees, seat selection and upgrade fees, priority check-in and boarding fees, itinerary service fees and on-board sales, which are recognized when the associated flight occurs. Revenue for change fees is deferred and recognized when the passenger travel is provided. Fees received in advance of the flight date are initially recorded as an Air Traffic Liability. Charter. Charter revenue is recognized at the time of departure when transportation is provided. Revenue is generated from airline service agreements and is typically based on block hours flown. Under these agreements, the Company is obligated to provide aircraft for travel. Customers are generally responsible for aircraft fuel, landing fees, and certain other flight expenses, which are typically arranged by the Company. When functioning as the customers' agent for arranging such services, the Company records amounts reimbursable from the customer as revenues, net of the associated costs incurred to fulfill the performance obligations. The typical lead time for a charter flight is significantly less than one year; therefore, the Company does not capitalize cost related to obtaining the contract. Cargo. The ATSA is a six-year contract and includes two, two-year extensions exercisable at Amazon’s option, providing for a total term of ten years if both extension options are exercised. Each extension must be exercised with at least 180 days’ prior written notice before the expiration of the then-current term. The ATSA has annual rate escalations. Rate increases occurred on December 13, 2022, 2021, and 2020. Cargo revenue is typically recognized based on hours flown, number of flights, and the amount of aircraft resources provided during a reporting period. The ATSA contains three performance obligations: Flight Services, Heavy Maintenance and Fuel. As Sun Country is the principal in providing Flight Services, revenue and related costs are recognized gross on the Statement of Operations. Sun Country acts as the agent in providing the Heavy Maintenance and Fuel performance obligations, which are reimbursed by Amazon based on the actual costs incurred. Consumption of aircraft fuel and heavy maintenance are recognized in revenue, net of the associated costs incurred to fulfill the performance obligations. The ATSA with Amazon consists of three main components for revenue; a fixed amount is received each month per aircraft, a fixed amount is received each month per flight, and an amount per block hour is received each month. The ATSA contains a Service Level Agreement ("SLA") and penalties for certain delays and cancellations. The SLA can result in a bonus or penalty for the month depending on the Company's performance. When determining the transaction price, the Company will estimate the variable consideration and consideration payable to Amazon over the contract term. Each period, the Company updates its estimate for the variable consideration and consideration payable to the customer and treats the adjustment as an adjustment to the transaction price. When updating the estimate, the Company considers whether there are any changes in expected block hours, changes in expected bonuses or penalties based on performance, changes in warrants |
Loyalty Program Accounting | Loyalty Program Accounting – The Company records a liability for loyalty points earned by passengers under its 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 breakage, and 2) a liability for points attributed to loyalty points issued to the Company’s co-branded credit card holders is established by deferring a portion of payments received from the Company’s co-branded agreement. The Company’s Sun Country Rewards program allows for the redemption of loyalty points to include payment towards air travel, land travel, taxes, and other ancillary purchases. The Company determines the standalone selling price of loyalty points issued using a redemption value approach, which considers the value a passenger will receive upon redemption of the loyalty points. Consideration allocated to loyalty points is deferred, net of estimated breakage, and recognized as Passenger Revenue when both the loyalty points have been redeemed and the passenger travel occurs. The Company estimates breakage for loyalty points that are not likely to be redeemed. These estimates are based on historical experience of loyalty point redemption activity and other factors, such as program changes and modifications that could affect the ultimate usage pattern of loyalty points. The current portion of the Loyalty Point Liability is an estimate primarily based on historical redemption patterns over the past 12 months, as well as other factors that may not be indicative of historical trends. Under the Company's co-branded credit card program, funds received for the marketing of a co-branded credit card and delivery of loyalty points are accounted for as a multiple-deliverable arrangement. At the inception of the arrangement, the Company evaluated all deliverables in the arrangement to determine whether they represent distinct performance obligations. The Company determined the arrangement has two distinct performance obligations: loyalty points to be awarded, and brand and marketing. Funds received are allocated based on relative standalone selling price. Revenue for the brand and marketing performance obligation is recognized as revenue when earned and recorded in Other Revenue. Consideration allocated to loyalty points is deferred and recognized as Passenger Revenue upon future redemption of the points. |
Cash and Equivalents | Cash and Equivalents – The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. The Company maintains cash balances at several financial institutions; at times, such balances may be in excess of insurance limits. The Company has not experienced any losses on these balances. |
Restricted Cash | Restricted Cash – Charter revenue receipts received prior to the date of transportation are recorded as Restricted Cash and as a component of the Air Traffic Liabilities. Department of Transportation ("DOT") regulations require that charter revenue receipts received prior to the date of transportation are maintained in a separate third-party escrow account. The restrictions are released once transportation is provided, which is typically within 12 months of booking. For that reason, the balance of Restricted Cash is classified as a current asset on the Company's Consolidated Balance Sheets. |
Investments | Investments – The Company's 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. The Debt Securities are classified as Current Assets on the 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. These investments have original maturities of three months or greater. Most of the Company's Debt 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. Securities downgraded below policy minimums after purchase will be disposed of in accordance with the Company’s investment policy. |
Accounts Receivable | Accounts Receivable – Accounts Receivable are recorded at the amount due from customers and do not bear interest. They consist primarily of amounts due from Amazon, credit card companies associated with ticket sales and charter service customers. The Company's Accounts Receivable balances at December 31, 2022 and 2021 also included $1,000 and $2,163, respectively, due from aircraft lessors related to maintenance deposits. Accounts outstanding longer than the contractual payment terms are considered past due. The Company determines its allowances for credit losses by considering a number of factors, including the length of time accounts receivable are past due, the Company’s previous loss history, the customer’s current ability to pay its obligation to the Company, and the condition of the general economy and the industry as a whole. During the years ended December 31, 2022, 2021 and 2020, $70, $17 and $982 in Accounts Receivable were written off, respectively. |
Lessor Maintenance Deposits | Lessor Maintenance Deposits – Certain of the Company’s aircraft lease agreements provide that the Company pay maintenance reserves monthly to aircraft lessors to be held as collateral in advance of major maintenance activities required to be performed by the Company. Generally, maintenance reserve payments are variable based on actual flight hours or cycles. These lease agreements provide that maintenance reserves are reimbursable to the Company upon completion of the maintenance event in an amount equal to the lesser of (1) the amount of the maintenance reserve held by the lessor associated with the specific maintenance event or (2) the qualifying costs related to the specific maintenance event. Maintenance reserve payments that are expected to be recoverable via reimbursable expenses are reflected as Lessor Maintenance Deposits on the accompanying Consolidated Balance Sheets. These deposits are expected to be reimbursed to the Company upon performance of maintenance activities. Upon completion of the maintenance event, the lessor is billed and the amount due is recorded in Accounts Receivable. Lessor Maintenance Deposits not deemed probable of recovery are expensed as incurred. The Company makes certain assumptions at the inception of the lease and at each Balance Sheet date to determine the recoverability of maintenance deposits. These assumptions are based on various factors, such as the estimated time between the maintenance events, the cost of such maintenance events, the date the aircraft is due to be returned to the lessor and the number of flight hours and cycles the aircraft is estimated to be utilized before it is purchased or returned to the lessor. Changes in estimates are accounted for on a prospective basis. At the April 11, 2018 acquisition date of Sun Country, Inc. (the “Acquisition Date”), the Company established a contra-asset to 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, the contra-asset is recognized as a reduction to Maintenance expense. |
Inventory | Inventory – Inventories primarily consist of expendable parts related to flight equipment, which cannot be economically repaired, reconditioned or reused after removal from the aircraft, are carried at average cost and charged to operations as consumed. An allowance for obsolescence and excess is provided over the remaining useful life of the related fleet for spare parts expected to be on hand at the date that aircraft type is retired from service. These parts are assumed to have an estimated residual value of 10% of the original cost. |
Leases | Leases – Lease classification is evaluated by the Company at lease commencement and when significant amendments are executed . The Company's leases generally do not provide a readily determinable implicit rate; therefore, the Company estimates the incremental borrowing rate to discount lease payments based on information available at lease commencement. The lease term consists of the noncancellable period of the lease and periods covered by options to extend the lease if the Company is reasonably certain to exercise the option. For leases of 12 months or less, the Company expenses lease payments on a straight-line basis over the lease term. Operating Lease Right-of-Use Asset and Liabilities For all operating leases with a term greater than 12 months, the Company recognizes a right-of-use asset and a lease liability at the lease commencement date based on the estimated present value of future minimum lease payments, which includes certain lease and non-lease components, over the lease term. Operating Lease Right-of-use Assets and Operating Lease Obligations have their own lines on the Consolidated Balance Sheets. Finance Leases Finance leases are initially recorded at the net present value of future minimum lease payments, which includes certain lease and non-lease components. Finance leases generally have one of these five attributes: 1) ownership of the underlying asset transfers to the Company at the end of the lease term, 2) the lease agreement contains a purchase option that the Company is reasonably certain to exercise, 3) the lease term represents the major part of the asset’s economic life , 4) the present value of lease payments over the lease term equals or exceeds substantially all of the fair value of the asset, and 5) the underlying asset is so specialized in nature that it provides no alternative use to the lessor after the lease term . Finance Lease Assets are presented on separately on the Consolidated Balance Sheets. The Company depreciates Finance Lease Assets consistent with its useful life policy presented in the table below. Leased Aircraft Return Costs The Company's aircraft lease agreements often contain provisions that require the Company to return aircraft airframes, engines, and other aircraft components to the lessor in a certain condition or pay an amount to the lessor based on the airframe and engine's actual return condition. Lease return costs are recognized beginning when it is probable that such costs will be incurred and they can be estimated. The Company assesses the need to accrue lease return costs periodically throughout the year or whenever facts and circumstances warrant an assessment. When costs become both probable and estimable, lease return costs are expensed as a component of Aircraft Rent expense on the Consolidated Statements of Operations. |
Property & Equipment | Property & Equipment – Property and equipment are recorded at cost or fair value at the Acquisition Date and depreciated, when the asset is ready for its intended use, on a straight-line basis to an estimated residual value over their estimated useful lives or lease term (if applicable), whichever is shorter, as follows: Airframes 10-25 years (depending on age) Engines – Core 7 or 12 years (based on remaining cycles) Engines - Initial Greentime (time remaining until the first scheduled major maintenance event) 1 st scheduled maintenance event Leasehold Improvements, Aircraft, Other 3-25 years (or life of lease, if shorter) Office and Ground Equipment 5-7 years Computer Hardware and Software 3-5 years Property and Equipment under Finance Leases Lesser of the lease term or economic life Rotable Parts Average remaining life of aircraft fleet, currently estimated to be 6-16 years Modifications that enhance the operating performance or extend the useful lives of leased airframes are considered leasehold improvements and are capitalized and depreciated over the economic life of the asset or the term of the lease, whichever is shorter. Similar modifications made to owned aircraft are capitalized and depreciated consistent with the Company’s policy. The Company capitalizes certain internal and external costs associated with the acquisition and development of internal-use software for new products, and enhancements to existing products, that have reached the application development stage and meet recoverability tests. Capitalized costs include external direct costs of materials and services utilized in developing or obtaining internal-use software, and labor cost for employees who are directly associated with, and devote time to, internal-use software projects. The Company depreciates Rotable Parts to an estimated residual value using the pooling life method. Depreciation under the pooling life method is calculated over the estimated average useful life of the passenger aircraft fleet. The Company capitalizes certain costs of activities necessary to get the asset ready for its intended use. Capitalized interest represents interest costs incurred during the aircraft induction period, capitalization ceases when the asset is ready for service. See Note 8 for further information on the Company's Long-Term Debt. |
Airframe and Engine Maintenance | Airframe and Engine Maintenance – The Company accounts for non-major maintenance and repair costs incurred, as well as major maintenance costs of owned airframes, all leased airframes, and engines acquired via operating leases, using the expense as incurred method. Certain costs covered by third-party maintenance agreements are charged to expense based on an hourly fee, as defined by the contract. These expenses are reported as a component of Maintenance expense on the accompanying Consolidated Statements of Operations. The Company applies the Built-in Overhaul method for significant maintenance costs of owned engines, as well as to engines acquired via finance leases where the Company is reasonably certain to exercise a purchase option. Under this method, engine values are separated into amounts for life limited parts and “greentime”, representing the value of the engine for the time on-wing remaining until the next anticipated major maintenance event. Life limited parts are capitalized based on catalog rates published by the original equipment manufacturer and depreciated over their estimated useful lives. Initial engine "greentime" and subsequent major engine maintenance events are capitalized and depreciated until the next anticipated major maintenance event, assuming no residual value. The estimated period until the next scheduled major maintenance event is estimated based on assumptions such as estimated cycles, hours, and months, required maintenance intervals, and the age/condition of related parts. These assumptions may change based on forecasted aircraft utilization changes, updates to government regulations, and manufacturer maintenance intervals, as well as unplanned |
Asset Impairment Analysis | Asset Impairment Analysis – Long-lived assets, such as Property & Equipment and Finite-Lived Intangible Assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset (or asset group) may not be recoverable. If circumstances require a long-lived asset or asset group be tested for impairment, the Company first compares the undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying amount exceeds its fair value. Fair value is determined using various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets – Goodwill represents the excess purchase price over the estimated fair value of net assets acquired in a business combination. Indefinite-Lived Intangible Assets represents a tradename acquired in a business combination and Finite-Lived Intangible Assets represent customer relationships. Goodwill and Other Indefinite-Lived Intangible Assets must be tested for impairment at least annually, or more frequently if events or changes in circumstances indicate that they might be impaired. Goodwill is tested at the reporting unit level. The Company has two reporting units: Passenger and Cargo, all Goodwill is related to the passenger reporting unit. Finite-Lived Intangible Assets are amortized over an estimated useful life based on several factors, including the effects of demand, competition, contractual relationship, and other business factors. The Company concluded that the customer relationships Finite-Lived Intangible Assets have an estimated life of 12 years and are being amortized over this period on a straight-line basis. The value of Goodwill and Other Indefinite-lived Intangible Assets is assessed under either a qualitative or quantitative approach. Under a qualitative approach, the Company considers various market factors, including certain key assumptions, such as the market value of other airlines, fuel prices, the overall economy, passenger yields and changes to the regulatory environment. The Company analyzes these factors to determine if events and circumstances have affected the fair value of Goodwill and Other Indefinite-lived Intangible Assets. If it is determined that it is more likely than not that the asset may be impaired, the Company uses a quantitative approach to determine the reporting unit or intangible asset’s fair value incorporating the key assumptions listed below. An impairment charge is recorded for the amount of carrying value that exceeds the determined fair value as of the testing date. When the Company evaluates Goodwill or its Other Indefinite-Lived Intangible Assets for impairment using a quantitative approach, the Company utilizes market and income approach valuation techniques. These measurements include the following key assumptions, 1) forecasted revenues, expenses and cash flows, 2) current discount rates, 3) observable market transactions, and 4) anticipated changes to the regulatory environment. These assumptions are consistent with those that hypothetical market participants would use. Because the Company is required to make estimates and assumptions when evaluating Goodwill and Other Indefinite-Lived Intangible Assets for impairment, actual transaction amounts may differ materially from these estimates. |
Income Taxes | Income Taxes – Deferred income taxes are recognized for the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts at each year end based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce Deferred Tax Assets to the amount expected to be realized. All Deferred Tax Assets and Liabilities, along with any related valuation allowance, are classified as noncurrent on the Consolidated Balance Sheets. Interest and penalties on uncertain tax positions, to the extent they exist, are included in the Company’s provision for income taxes. The provision for income taxes represents the current tax expense for the period and the change during the period in Deferred Tax Assets and Liabilities. |
Valuation of the TRA Liability | Valuation of the Tax Receivable Agreement ("TRA") Liability – In connection with the Company’s IPO, the Company entered into a TRA with 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. Prior to the expiration of the dividend and capital distribution restrictions included in the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) in 2022, the TRA Liability was subject to adjustments as a result of changes in taxable income earned during the restricted period. Future adjustments in the TRA liability balance and/or timing of TRA liability payments are contingent upon, among other things, 1) generation of future taxable income over the term of the TRA, 2) the Company’s participation in future government programs, and 3) future changes in tax laws. Any adjustments to the TRA liability would be recorded in Other Non-Operating Income (Expense) in the Company’s Consolidated Statements of Operations. Pursuant to certain CARES Act restrictions, payments under the TRA were prohibited through September 30, 2022. The Company expects to make payments under the TRA starting in 2023. The portion of the TRA expected to be paid in 2023 is reflected as a current liability on the Consolidated Balance Sheets. All other amounts are reflected as a non-current liability on the Consolidated Balance Sheets. |
Aircraft Fuel | Aircraft Fuel - Aircraft fuel expense includes jet fuel, federal and state taxes, other fees and the mark-to-market gains and losses associated with the Company's fuel derivative contracts since it does not apply hedge accounting |
Sales And Marketing | Sales and Marketing - Sales and Marketing expense includes credit card processing fees, travel agent commissions and related global distribution systems fees, advertising, sponsorship and distribution costs, such as the costs of our call centers, and costs associated with our loyalty program. The Company expenses advertising costs as incurred. |
Equity Incentive Plan | Equity Incentive Plan – Under its Equity Incentive Plan, the Company has primarily issued Time-Based Stock Options, Performance-Based Stock Options, Restricted Stock and Restricted Stock Unit (“RSUs”) awards. Due to the Company's limited stock award history, it does not always have sufficient historical stock option activity to make predictive assumptions based solely on its stock or stock option activity for the Black-Scholes option-pricing model or other pricing models. As a result, the Company may need to use data from other comparable public companies or alternative calculation methods to make predictive assumptions. Further, the Company has elected to account for forfeitures as they occur, rather than forecasting the future forfeitures. If an award is forfeited prior to vesting, the associated reduction in expense is reflected net in stock-based compensation expense in that period. Stock compensation expense is reported as a component of Salaries, Wages, and Benefits within the Company's Consolidated Statement of Operations. See Note 10 for further information on the Equity Incentive Plan. |
Earnings per Share | Earnings per Share - Basic earnings per share, which excludes dilution, is computed by dividing Net Income (Loss) available to common stockholders by the weighted average number of shares of common stock outstanding for the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. The number of incremental shares from the assumed issuance of shares relating to securities or other contracts to issue common stock is calculated by applying the treasury stock method. The treasury stock method assumes a hypothetical issuance of shares to settle the securities or other contracts to issue common stock, with the assumed proceeds used to purchase common stock at the average market price for the period. Assumed proceeds include the amount to be paid upon exercise, if applicable, and the average unrecognized compensation cost. The difference between the number of shares assumed issued and number of shares assumed purchased represents the dilutive shares. Warrants held by Amazon are included in the calculation of dilutive weighted average shares outstanding as of the date the warrants vest. The unvested warrants held by Amazon have not been included in dilutive shares as their performance condition has not been satisfied. |
Concentration Risk | Concentration Risk Approximately 33% and 56% of the Company’s Accounts Receivable balances as of December 31, 2022, and 2021 were due from Amazon, respectively. In addition, approximately 16% and 8% of the Company’s Accounts Receivable balances as of December 31, 2022 and 2021, were due from one financial institution for tickets purchased via credit cards. Approximately 69%, of the Company's fuel purchases were made from three vendors for the year ended December 31, 2022. Approximately 54% and 57% of the Company’s fuel purchases were made from two vendors for the years ended December 31, 2021 and 2020, respectively. Approximately 53% of the Company’s workforce were under union contracts as of December 31, 2022 with four different unions: Air Line Pilots Association (“ALPA”), International Brotherhood of Teamsters (“IBT”), Transport Workers Union (“TWU”) and Aircraft Mechanics Fraternal Association ("AMFA"). As of January 4, 2023, our fleet service employees (cargo, commissary/catering, ramp agents, and bag room agents) elected to be represented by the IBT. Negotiations have not yet begun for a new collective bargaining agreement with our fleet service employees. As of December 31, 2022, approximately 55% of the Company’s union workforce are under contracts in negotiations that are new or have become amendable. With the January 4th, 2023 election by the Company's fleet services employees to be represented by a union, this percentage increased to 63%. The following table shows the Company’s airline employee groups represented by unions: Employee Group Number of Active Employees Represented at December 31, 2022 Union Date on which Collective Sun Country Pilots 571 ALPA December 31, 2025 Sun Country Flight Attendants 547 IBT December 31, 2019 Sun Country Dispatchers 32 TWU November 30, 2024 Sun Country Technicians and related craft employees 177 AMFA Contract in Negotiations |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity. This standard simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity's own equity. On January 1, 2022, the Company adopted ASU 2020-06 using a modified retrospective approach. There was no financial statement impact upon adoption. 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 ("ASU 2021-10") . 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 and included disclosures as required under ASU 2021-10, see Note 3 |
BASIS OF PRESENTATION AND SUM_3
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of airline employee groups represented by unions | The following table shows the Company’s airline employee groups represented by unions: Employee Group Number of Active Employees Represented at December 31, 2022 Union Date on which Collective Sun Country Pilots 571 ALPA December 31, 2025 Sun Country Flight Attendants 547 IBT December 31, 2019 Sun Country Dispatchers 32 TWU November 30, 2024 Sun Country Technicians and related craft employees 177 AMFA Contract in Negotiations |
Property & Equipment, residual value over estimated useful lives or lease term | Property & Equipment – Property and equipment are recorded at cost or fair value at the Acquisition Date and depreciated, when the asset is ready for its intended use, on a straight-line basis to an estimated residual value over their estimated useful lives or lease term (if applicable), whichever is shorter, as follows: Airframes 10-25 years (depending on age) Engines – Core 7 or 12 years (based on remaining cycles) Engines - Initial Greentime (time remaining until the first scheduled major maintenance event) 1 st scheduled maintenance event Leasehold Improvements, Aircraft, Other 3-25 years (or life of lease, if shorter) Office and Ground Equipment 5-7 years Computer Hardware and Software 3-5 years Property and Equipment under Finance Leases Lesser of the lease term or economic life Rotable Parts Average remaining life of aircraft fleet, currently estimated to be 6-16 years |
Impact of revision on previously issued statements | 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 Consolidated Statements of Operations for the year ended December 31, 2021 are as follows: Year Ended December 31, 2021 As Previously Issued Correction As Revised Operating Expenses Depreciation and Amortization $ 55,019 $ 2,056 $ 57,075 Special Items, net (65,456) (6,963) (72,419) Total Operating Expenses 515,975 (4,907) 511,068 Operating Income 107,040 4,907 111,947 Income Before Income Tax 95,423 4,907 100,330 Income Tax Expense 17,953 1,129 19,082 Net Income 77,470 3,778 81,248 Basic Income per share $ 1.40 $ 0.07 $ 1.47 Diluted Income per share $ 1.31 $ 0.06 $ 1.37 The Company's Consolidated Statement of Changes in 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 Consolidated Statements of Cash Flows for the year ended December 31, 2021 is as follows: Year Ended December 31, 2021 As Previously Issued Correction As Revised Operating Activities Net Income $ 77,470 $ 3,778 $ 81,248 Depreciation and Amortization 55,019 2,056 57,075 Non-Cash Gain on Asset Transaction, Net (12,673) 12,668 (5) Deferred Income Taxes 17,480 1,129 18,609 Operating Lease Obligations (24,433) (12,668) (37,101) Net Cash Provided by Operating Activities 152,013 6,963 158,976 Investing Activities Purchases of Property & Equipment (116,369) (6,963) (123,332) Net Cash Used in Investing Activities $ (116,973) $ (6,963) $ (123,936) The impact of the revision on the Company's previously issued Condensed Parent Company-only Balance Sheets as of December 31, 2021 are as follows: December 31, 2021 As Previously Issued Correction As Revised Assets Investment in Subsidiary $ 602,561 $ 3,778 $ 606,339 Total Other Assets 602,561 3,778 606,339 Total Assets 602,561 3,778 606,339 Stockholders' Equity Retained Earnings 115,794 3,778 119,572 Total Stockholders' Equity 602,011 3,778 605,789 Total Liabilities and Stockholders' Equity $ 602,561 $ 3,778 $ 606,339 The impact of the revision on the Company's previously issued Condensed Parent Company-only Statements of Operations for the year ended December 31, 2021 are as follows: Year Ended December 31, 2021 As Previously Issued Correction As Revised Operating Expenses Equity in Income of Subsidiaries $ 77,534 $ 3,778 $ 81,312 Total Non-operating Income, net 77,534 3,778 81,312 Income Before Income Tax 77,470 3,778 81,248 Net Income $ 77,470 $ 3,778 $ 81,248 |
REVENUE (Tables)
REVENUE (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of significant categories comprising Operating Revenues | The significant categories comprising Operating Revenues are as follows: Year Ended December 31, 2022 2021 2020 Scheduled service $ 438,308 $ 279,377 $ 193,047 Charter service 161,619 127,331 98,130 Ancillary 192,506 117,237 68,055 Passenger 792,433 523,945 359,232 Cargo 90,350 91,428 36,809 Other 11,661 7,642 5,445 Total Operating Revenue $ 894,444 $ 623,015 $ 401,486 |
Schedule of Total Operating Revenues by geographic region | Total Operating Revenues by geographic region are as follows: Year Ended December 31, 2022 2021 2020 Domestic $ 857,764 $ 597,005 $ 382,463 Latin America 36,537 24,646 18,515 Other 143 1,364 508 Total Operating Revenue $ 894,444 $ 623,015 $ 401,486 |
Summary of Contract Assets and Liabilities | Contract Assets and Liabilities are as follows: December 31, 2022 2021 Contract Assets Costs to fulfill contract with Amazon $ 2,195 $ 2,819 Total Contract Assets $ 2,195 $ 2,819 Contract Liabilities Air Traffic Liabilities $ 157,995 $ 118,562 Loyalty Program Liabilities 15,437 19,718 Amazon Deferred Up-front Payment 3,271 4,200 Total Contract Liabilities $ 176,703 $ 142,480 |
Schedule of Changes in the Loyalty Program Liabilities | Changes in the Loyalty Program Liabilities are as follows: 2022 2021 Balance - January 1 $ 19,718 $ 22,069 Loyalty Points Earned 7,052 4,562 Loyalty Points Redeemed (1) (11,333) (6,913) Balance - December 31 $ 15,437 $ 19,718 ________________________________ (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) | 12 Months Ended |
Dec. 31, 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 (loss) per share: Year Ended December 31, 2022 2021 2020 Net Income (Loss) $ 17,676 $ 81,248 $ (3,904) Denominator: Weighted Average Common Shares Outstanding - Basic 57,951,955 55,182,811 46,806,042 Dilutive effect of Stock Options, RSUs and Warrants (1) 3,094,640 4,141,229 — Weighted Average Common Shares Outstanding - Diluted 61,046,595 59,324,040 46,806,042 Basic earnings (loss) per share $ 0.31 $ 1.47 $ (0.08) Diluted earnings (loss) per share $ 0.29 $ 1.37 $ (0.08) _________________________________ (1) There were 3,178,533, 3,636,771 and 3,577,252 performance-based stock options outstanding at December 31, 2022, 2021, and 2020, respectively. As of December 31, 2022 and 2021, the Company expected approximately 59% and 75% of these options to vest, respectively. As of December 31, 2022 32.5% of the eligible outstanding performance-based stock options vested and were considered exercisable. No amounts had vested as of December 31, 2021. These amounts are included in the measure above to the extent they are dilutive. |
AIRCRAFT (Tables)
AIRCRAFT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Summary of Aircraft Fleet Activity | The following tables summarize the Company’s aircraft fleet activity for the years ended 2022 and 2021, respectively: December 31, 2021 Additions Reclassifications Removals December 31, 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 December 31, 2021 Passenger: Owned 14 1 6 — 21 Finance leases 5 4 — — 9 Operating leases 12 — (6) — 6 Sun Country Airlines' Fleet 31 5 — — 36 Cargo: Aircraft Operated for Amazon 12 — — — 12 Total Aircraft Operated 43 5 — — 48 (1) Two aircraft operating leases were reclassified into finance leases 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 is as follows: Year Ended December 31, Aircraft Status Expense Type 2022 2021 2020 Owned Depreciation $ 40,311 $ 35,855 $ 25,294 Finance Leased Amortization 16,871 11,507 13,253 Operating Leased Aircraft Rent (1) 8,768 17,653 30,989 $ 65,950 $ 65,015 $ 69,536 _________________________________ (1) Aircraft Rent expense includes credits for the amortization of over-market liabilities established at the Acquisition Date. |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill and other intangible assets | Components of Goodwill and Other Intangible Assets were as follows: December 31, 2022 Gross Carrying Accumulated Net Carrying Goodwill $ 222,223 $ — $ 222,223 Intangible Assets with Finite Lives: Customer Relationships 48,000 (18,890) 29,110 Intangible Assets with Indefinite Lives: Tradename 56,000 — 56,000 Total Other Intangible Assets 104,000 (18,890) 85,110 Total Goodwill and Other Intangible Assets $ 326,223 $ (18,890) $ 307,333 December 31, 2021 Gross Carrying Accumulated Net Carrying Goodwill $ 222,223 $ — $ 222,223 Intangible Assets with Finite Lives: Customer Relationships 48,000 (14,890) 33,110 Intangible Assets with Indefinite Lives: Tradename 56,000 — 56,000 Total Other Intangible Assets 104,000 (14,890) 89,110 Total Goodwill and Other Intangible Assets $ 326,223 $ (14,890) $ 311,333 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Summary of long-term debt | Long-term Debt includes the following: December 31, 2022 2021 Notes payable under the Company's 2019-1 EETC agreement dated December 2019, with original loan amounts of $248,587 payable in semi-annual installments, in June and December, through December 2027. These notes bear interest at an annual rate of between 4.13% and 6.95% and the weighted average interest rate is 4.73% as of December 31, 2022. $ 176,697 $ 202,984 Notes payable under the Company's 2022-1 EETC agreement dated March 2022, with a face amount of $188,277 payable in semi-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 December 31, 2022. 179,019 — Delayed Draw Term Loan Facility — 77,481 Other Notes payable — 466 Total Debt 355,716 280,931 Less: Unamortized debt issuance costs (3,481) (3,505) Less: Current Maturities of Long-term Debt (57,548) (29,412) Total Long-term Debt $ 294,687 $ 248,014 |
Schedule of future maturities of the outstanding debt | Future maturities of the outstanding Debt are as follows: December 31 Debt Principal Amortization of Debt Net Debt 2023 $ 58,518 $ (970) $ 57,548 2024 60,157 (785) 59,372 2025 65,241 (608) 64,633 2026 45,668 (420) 45,248 2027 47,999 (302) 47,697 Thereafter 78,133 (396) 77,737 Total $ 355,716 $ (3,481) $ 352,235 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Summary of lease-related assets and liabilities | The following table summarizes the lease-related assets and liabilities recorded on the Company’s Consolidated Balance Sheets: December 31, Classification 2022 2021 Assets Finance lease assets, net Property and Equipment, net $ 221,727 $ 181,097 Operating lease assets Operating Lease Right-of-use Assets 22,182 61,658 Total lease assets $ 243,909 $ 242,755 Liabilities Current: Finance lease liabilities Short-term Finance Lease Obligations $ 17,990 $ 11,705 Operating lease liabilities Short-term Operating Lease Obligations 6,296 17,231 Long-term: Finance lease liabilities Long-term Finance Lease Obligations 233,306 180,450 Operating lease liabilities Long-term Operating Lease Obligations 19,836 58,810 Total lease liabilities $ 277,428 $ 268,196 |
Summary of obligations under finance leases | The following table provides details of the Company’s obligations under Finance and Operating Leases as of December 31, 2022: Finance Leases Operating Leases Year Ending December 31 Aircraft Real Estate Total Aircraft Real Estate and Other Total 2023 $ 31,600 $ 1,492 $ 33,092 $ 4,382 $ 3,366 $ 7,748 2024 32,080 1,551 33,631 2,392 3,282 5,674 2025 32,080 1,773 33,853 — 3,273 3,273 2026 70,877 1,773 72,650 — 3,296 3,296 2027 20,604 1,773 22,377 — 3,306 3,306 Thereafter 122,527 3,179 125,706 — 8,722 8,722 Total Minimum Lease Payments 309,768 11,541 321,309 6,774 25,245 32,019 Less: Amount Representing Interest (66,652) (3,361) (70,013) (316) (5,571) (5,887) Present Value of Minimum Lease Payments 243,116 8,180 251,296 6,458 19,674 26,132 Less: Short-term Obligations (17,309) (681) (17,990) (4,111) (2,185) (6,296) Long-term Lease Obligations $ 225,807 $ 7,499 $ 233,306 $ 2,347 $ 17,489 $ 19,836 |
Summary of obligations under operating leases | The following table provides details of the Company’s obligations under Finance and Operating Leases as of December 31, 2022: Finance Leases Operating Leases Year Ending December 31 Aircraft Real Estate Total Aircraft Real Estate and Other Total 2023 $ 31,600 $ 1,492 $ 33,092 $ 4,382 $ 3,366 $ 7,748 2024 32,080 1,551 33,631 2,392 3,282 5,674 2025 32,080 1,773 33,853 — 3,273 3,273 2026 70,877 1,773 72,650 — 3,296 3,296 2027 20,604 1,773 22,377 — 3,306 3,306 Thereafter 122,527 3,179 125,706 — 8,722 8,722 Total Minimum Lease Payments 309,768 11,541 321,309 6,774 25,245 32,019 Less: Amount Representing Interest (66,652) (3,361) (70,013) (316) (5,571) (5,887) Present Value of Minimum Lease Payments 243,116 8,180 251,296 6,458 19,674 26,132 Less: Short-term Obligations (17,309) (681) (17,990) (4,111) (2,185) (6,296) Long-term Lease Obligations $ 225,807 $ 7,499 $ 233,306 $ 2,347 $ 17,489 $ 19,836 |
Summary of lease costs related to the Finance and Operating Leases | The following table presents lease costs related to the Company’s Finance and Operating Leases: Year Ended December 31, Classification 2022 2021 2020 Finance lease cost Amortization of leased assets Depreciation and Amortization $ 17,900 $ 12,536 $ 11,948 Interest on lease liabilities Interest Expense 13,782 8,021 8,659 Operating lease cost Included in ROU asset - Aircraft Aircraft Rent (1) 8,465 18,608 30,717 Included in ROU asset - Real Estate & Other Ground Handling, Landing Fees and Airport Rent & Other Operating 3,692 3,976 4,872 Short-term Aircraft Rent 691 277 1,813 Variable - Aircraft Aircraft Rent (1) (388) (1,232) (1,541) Variable - Other Landing Fees & Airport Rentals 1,838 1,210 1,049 Total Lease cost $ 45,980 $ 43,396 $ 57,517 _________________________________ (1) The years ended December 31, 2022, 2021 and 2020, include credits of $3,228, $7,609 and $14,110, respectively, for the amortization of Over-market Liabilities established at the Acquisition Date related to lease rates and maintenance reserves. |
Summary of supplemental cash flow information related to leases | The following table presents Supplemental cash flow information related to leases, included in the Consolidated Statements of Cash Flows: Year Ended December 31, 2022 2021 2020 Cash paid for amounts included in the measurement of lease liabilities: Operating Cash Flows for Operating Leases $ 12,378 $ 29,360 $ 34,576 Operating Cash Flows for Finance Leases $ 13,782 $ 8,021 $ 8,659 Financing Cash Flows for Finance Leases $ 42,062 $ 11,931 $ 89,697 |
Summary of lease-related terms and discount rates | The table below presents lease-related terms and discount rates related to the Company’s Finance and Operating Leases: Year Ended December 31, 2022 2021 2020 Weighted-average remaining lease term Operating Leases 5.9 years 4.6 years 4.8 years Finance Leases 6.1 years 7.2 years 8.6 years Weighted-average discount rates Operating Leases 6.3% 6.0% 6.0% Finance Leases 6.2% 6.1% 6.1% |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Compensation Related Costs [Abstract] | |
Summary of time-based stock option activity | The following table is a summary of the Company's time-based stock option activity: Time-Based Stock Options Number of Weighted Weighted Weighted Aggregate Intrinsic Value (in thousands) Outstanding as of December 31, 2019 2,281,308 $ 5.84 $ 2.54 9.0 Granted 221,941 17.99 7.02 Forfeited (173,788) 14.65 5.70 Outstanding as of December 31, 2020 2,329,461 $ 6.36 $ 2.74 7.6 Granted 62,080 33.10 13.47 Forfeited (18,613) 11.75 5.15 Exercised (718,985) 5.89 2.56 Outstanding as of December 31, 2021 1,653,943 $ 7.57 $ 3.22 7.2 Granted — — — Forfeited (119,605) 20.09 8.03 Exercised (177,816) 5.63 2.49 Outstanding as of December 31, 2022 1,356,522 $ 6.72 $ 2.89 6.1 $ 12,950 Exercisable as of December 31, 2022 1,214,803 $ 6.12 $ 2.65 $ 12,084 Vested or expected to vest, December 31, 2022 1,356,522 $ 6.72 $ 2.89 $ 12,950 |
Schedule of stock options valuation assumptions | The assumptions used for the Black-Scholes option pricing model were as follows: 2021 2020 Expected Term 5.1 years 5.6 years Expected Volatility 34.0 % 38.8 % Risk-free Interest Rate 1.2 % 1.7 % Expected Dividend Yield — — |
Summary of performance-based stock option activity | The following table is a summary of the Company's performance-based stock option activity: Performance-Based Stock Options Number of Weighted Weighted Weighted Aggregate Intrinsic Value (in thousands) Outstanding as of December 31, 2019 3,502,947 $ 5.86 $ 1.61 9.0 Granted 346,984 17.99 4.36 Forfeited (272,679) 14.65 3.59 Outstanding as of December 31, 2020 3,577,252 $ 6.38 $ 1.72 7.6 Granted 99,167 33.10 10.08 Forfeited (39,648) 6.89 1.67 Outstanding as of December 31, 2021 3,636,771 $ 7.10 $ 1.53 7.2 Granted — — — Forfeited (307,894) 14.13 4.43 Exercised (150,344) 6.55 1.74 Outstanding as of December 31, 2022 3,178,533 $ 6.45 $ 1.83 6.1 $ 30,793 Exercisable as of December 31, 2022 964,635 $ 6.64 $ 1.93 $ 9,322 Vested or expected to vest, December 31, 2022 (1) 1,888,049 $ 6.45 $ 1.83 $ 18,291 _________________________________ (1) As of December 31, 2022, the Company expected approximately 59% of these options to vest. |
Time-Based RSUs | Restricted Stock Units Number of Weighted Outstanding as of December 31, 2020 — $ — Granted 7,634 40.60 Forfeited (2,955) 40.60 Outstanding as of December 31, 2021 4,679 40.60 Granted 248,025 20.44 Forfeited (5,478) 23.04 Vested (17,035) 25.87 Outstanding as of December 31, 2022 230,191 $ 20.39 |
DEFINED CONTRIBUTION 401(k) P_2
DEFINED CONTRIBUTION 401(k) PLAN (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Retirement Benefits [Abstract] | |
Schedule of 401(k) contributions | The Company made 401(k) contributions as follows: Year Ended December 31, 2022 2021 2020 Non-Discretionary $ 13,692 $ 1,187 $ 1,040 Discretionary 2,730 5,220 4,263 Total 401(k) Contributions $ 16,422 $ 6,407 $ 5,303 |
FUEL DERIVATIVES AND RISK MAN_2
FUEL DERIVATIVES AND RISK MANAGEMENT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of changes in derivative assets (liabilities) | Changes in Derivative Assets (Liabilities) are as follows: December 31, 2022 2021 Balance - January 1 $ — $ (1,174) Non-cash Gains — 3,527 Contract Settlements — (2,353) Balance - December 31 $ — $ — |
Schedule of fuel derivative gains (losses) | Fuel Derivative Gains (Losses) consist of the following: Year Ended December 31, 2022 2021 2020 Non-cash Gains (Losses) $ — $ 3,527 $ (12,206) Cash Premiums Paid — — (2,053) Total Fuel Derivative Gains (Losses) $ — $ 3,527 $ (14,259) |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Investments, Debt and Equity Securities [Abstract] | |
Summary of debt securities by major security type | A summary of the Company's Available-for-Sale debt securities by major security type is as follows: December 31, 2022 (1) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-Sale Securities (2) : Municipal Debt Securities $ 47,897 $ 16 $ (258) $ 47,655 Corporate Debt Securities 93,460 1 (683) 92,778 U.S. Government Agency Securities 32,326 2 (126) 32,202 Total $ 173,683 $ 19 $ (1,067) $ 172,635 (1) As the Company purchased these investments during 2022; therefore, there is no comparable presentation for prior periods. (2) The Company also holds Certificates of Deposit that are included in Investments on the Consolidated Balance Sheets totaling $6,301 and $6,283 as of December 31, 2022 and December 31, 2021, respectively. |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 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: December 31, 2022 Level 1 Level 2 Level 3 Total Cash & Cash Equivalents $ 73,727 $ 18,359 $ — $ 92,086 Available-for-Sale Securities: Municipal Debt Securities — 47,655 — 47,655 Corporate Debt Securities — 92,778 — 92,778 U.S. Government Agency Securities — 32,202 — 32,202 Total Available-for-Sale Securities — 172,635 — 172,635 Total Assets Measured at Fair Value on a Recurring Basis $ 73,727 $ 190,994 $ — $ 264,721 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 (Table)
INCOME TAXES (Table) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Summary of the significant components of the provision for income taxes from continuing operations | Year Ended December 31, 2022 2021 2020 Current: Federal $ 1,329 $ — $ — State and Local 84 135 10 Total Current Tax Expense 1,413 135 10 Deferred: Federal 4,393 16,824 (597) State and Local 500 2,123 (191) Total Deferred Tax Expense (Benefit) 4,893 18,947 (788) Total Income Tax Expense (Benefit) $ 6,306 $ 19,082 $ (778) |
Summary of difference of income tax provision from that computed at the federal statutory corporate tax rate | The income tax provision differs from that computed at the federal statutory corporate tax rate as follows: Year Ended December 31, 2022 2021 2020 Expected Provision at Federal Statutory Tax Rate 21.0 % 21.0 % 21.0 % State Tax, net of Federal Impact 1.9 % 1.8 % 3.1 % Stock Compensation Benefit (4.3) % (3.6) % — % Tax Receivable Agreement 4.4 % (3.4) % — % Executive Compensation Limitation 2.0 % 3.0 % — % Employee Parking 0.9 % 0.2 % (3.3) % Meals and Entertainment — % — % (2.2) % Other Permanent Adjustments 0.4 % — % (2.0) % Effective Tax Rate 26.3 % 19.0 % 16.6 % |
Summary of the significant components of the deferred taxes | The following table summarizes the significant components of the Company’s deferred taxes: December 31, 2022 2021 Deferred Tax Assets: Net Operating Loss $ 73,252 $ 77,920 Operating Lease Obligations 5,179 16,544 Finance Lease Obligations 34,458 40,178 Goodwill and Other Intangible Assets 6,812 9,699 Loyalty Program Liabilities 3,459 4,407 Accrued Maintenance — 718 Other 7,028 5,095 Total Deferred Tax Assets 130,188 154,561 Deferred Tax Liabilities: Accelerated Depreciation (78,749) (81,120) Operating Lease Right-of-use Assets (5,102) (14,181) Finance Lease Assets (30,492) (41,652) Prepaid Maintenance (1,986) — Other (903) — Total Deferred Tax Liabilities (117,232) (136,953) Total Net Deferred Tax Assets $ 12,956 $ 17,608 |
SPECIAL ITEMS, NET (Tables)
SPECIAL ITEMS, NET (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Unusual or Infrequent Items, or Both [Abstract] | |
Schedule of special items, net | Special Items, net on the Consolidated Statements of Operations consist of the following: Year Ended December 31, 2022 2021 2020 CARES Act grant recognition (see Note 3 ) $ — $ (71,587) $ (62,312) CARES Act employee retention credit (see Note 3 ) — (848) (2,328) Other (1) — 16 77 Total Special Items, net $ — $ (72,419) $ (64,563) (1) The 2021 and 2020 costs were related to relocation of flight attendant bases due to the closure of the Portland and Las Vegas bases. |
OPERATING SEGMENTS (Tables)
OPERATING SEGMENTS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Summary of financial information for the operating segments | The following tables present financial information for the Company’s two segments. Assets by segment are not reviewed by the CODM and have not been presented herein. The Company does not consider Interest Income, Interest Expense, and Other Income, net, in assessing the financial performance of its operating segments. Collectively, these items are included in reconciliations of reporting segment financial amounts to consolidated financial amounts. Year Ended December 31, 2022 Passenger Cargo Consolidated Operating Revenues $ 804,094 $ 90,350 $ 894,444 Non-Fuel Operating Expenses 479,968 90,405 570,373 Aircraft Fuel 268,279 84 268,363 Total Operating Expenses 748,247 90,489 838,736 Operating Income (Loss) $ 55,847 $ (139) 55,708 Interest Income 4,527 Interest Expense (31,018) Other, net (5,235) Income before Income Tax $ 23,982 Year Ended December 31, 2021 Passenger Cargo Consolidated Operating Revenues $ 531,587 $ 91,428 $ 623,015 Non-Fuel Operating Expenses 385,580 68,797 454,377 Aircraft Fuel 128,863 247 129,110 Special Items, net (54,019) (18,400) (72,419) Total Operating Expenses 460,424 50,644 511,068 Operating Income $ 71,163 $ 40,784 $ 111,947 Interest Income 85 Interest Expense (26,326) Other, net 14,624 Income before Income Tax $ 100,330 Year Ended December 31, 2020 (1) Passenger Cargo Consolidated Operating Revenues $ 364,677 $ 36,809 $ 401,486 Non-Fuel Operating Expenses 332,742 32,530 365,272 Aircraft Fuel 83,392 — 83,392 Special Items, net (53,842) (10,721) (64,563) Total Operating Expenses 362,292 21,809 384,101 Operating Income $ 2,385 $ 15,000 $ 17,385 Interest Income 377 Interest Expense (22,073) Other, net (371) Loss before Income Tax $ (4,682) (1) As air cargo operations commenced in May 2020, there are limited Cargo amounts included in the year ended December 31, 2020. |
PARENT COMPANY FINANCIAL STAT_2
PARENT COMPANY FINANCIAL STATEMENTS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Condensed Financial Information Disclosure [Abstract] | |
Impact of revision on previously issued condensed parent company | 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 Consolidated Statements of Operations for the year ended December 31, 2021 are as follows: Year Ended December 31, 2021 As Previously Issued Correction As Revised Operating Expenses Depreciation and Amortization $ 55,019 $ 2,056 $ 57,075 Special Items, net (65,456) (6,963) (72,419) Total Operating Expenses 515,975 (4,907) 511,068 Operating Income 107,040 4,907 111,947 Income Before Income Tax 95,423 4,907 100,330 Income Tax Expense 17,953 1,129 19,082 Net Income 77,470 3,778 81,248 Basic Income per share $ 1.40 $ 0.07 $ 1.47 Diluted Income per share $ 1.31 $ 0.06 $ 1.37 The Company's Consolidated Statement of Changes in 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 Consolidated Statements of Cash Flows for the year ended December 31, 2021 is as follows: Year Ended December 31, 2021 As Previously Issued Correction As Revised Operating Activities Net Income $ 77,470 $ 3,778 $ 81,248 Depreciation and Amortization 55,019 2,056 57,075 Non-Cash Gain on Asset Transaction, Net (12,673) 12,668 (5) Deferred Income Taxes 17,480 1,129 18,609 Operating Lease Obligations (24,433) (12,668) (37,101) Net Cash Provided by Operating Activities 152,013 6,963 158,976 Investing Activities Purchases of Property & Equipment (116,369) (6,963) (123,332) Net Cash Used in Investing Activities $ (116,973) $ (6,963) $ (123,936) The impact of the revision on the Company's previously issued Condensed Parent Company-only Balance Sheets as of December 31, 2021 are as follows: December 31, 2021 As Previously Issued Correction As Revised Assets Investment in Subsidiary $ 602,561 $ 3,778 $ 606,339 Total Other Assets 602,561 3,778 606,339 Total Assets 602,561 3,778 606,339 Stockholders' Equity Retained Earnings 115,794 3,778 119,572 Total Stockholders' Equity 602,011 3,778 605,789 Total Liabilities and Stockholders' Equity $ 602,561 $ 3,778 $ 606,339 The impact of the revision on the Company's previously issued Condensed Parent Company-only Statements of Operations for the year ended December 31, 2021 are as follows: Year Ended December 31, 2021 As Previously Issued Correction As Revised Operating Expenses Equity in Income of Subsidiaries $ 77,534 $ 3,778 $ 81,312 Total Non-operating Income, net 77,534 3,778 81,312 Income Before Income Tax 77,470 3,778 81,248 Net Income $ 77,470 $ 3,778 $ 81,248 |
Schedule of condensed financial statements | The following Condensed Parent Company-only Financial Statements are presented to show only the parent company, Sun Country Airlines Holdings, Inc. Balance Sheets December 31, 2022 2021 ASSETS Current Assets: Cash and Cash Equivalents $ — $ — Total Current Assets — — Other Assets: Investment in Subsidiary 609,396 606,339 Total Other Assets 609,396 606,339 Total Assets $ 609,396 $ 606,339 December 31, 2022 2021 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities: Accounts Payable $ — $ (1) Other Current Liabilities 16 57 Total Current Liabilities 16 56 Other Long-term Liabilities 1,468 494 Total Liabilities 1,484 550 Stockholders' Equity: Common Stock 582 579 Treasury Stock (17,605) — Additional Paid In Capital 488,494 485,638 Accumulated Other Comprehensive Income (807) — Retained Earnings 137,248 119,572 Total Stockholders' Equity 607,912 605,789 Total Liabilities and Stockholders' Equity $ 609,396 $ 606,339 Statements of Operations Year Ended December 31, 2022 2021 2020 Operating Expenses: Other Operating, net $ 465 $ 64 $ 179 Total Operating Expenses 465 64 179 Operating Loss (465) (64) (179) Non-operating Income (Expense): Equity in Income (Loss) of Subsidiaries 18,141 81,312 (3,725) Other, net — — — Total Non-operating Income (Expense), net 18,141 81,312 (3,725) Income (Loss) before Income Tax 17,676 81,248 (3,904) Income Tax Expense (Benefit) — — — Net Income (Loss) 17,676 81,248 (3,904) Other Comprehensive Loss (807) — — Comprehensive Income (Loss) $ 16,869 $ 81,248 $ (3,904) |
COMPANY BACKGROUND (Details)
COMPANY BACKGROUND (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | |||||||
Dec. 13, 2019 USD ($) $ / shares shares | Dec. 13, 2019 USD ($) $ / shares shares | Dec. 13, 2019 USD ($) item $ / shares shares | Dec. 13, 2019 USD ($) extension $ / shares shares | Dec. 31, 2022 $ / shares shares | Dec. 31, 2021 $ / shares shares | Dec. 31, 2020 shares | Dec. 31, 2018 $ / shares shares | |
Common stock-par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | ||||||
Amazon Agreement | ||||||||
Term of agreement (in years) | 6 years | |||||||
Number of extension option | 2 | 2 | ||||||
Term of renewal agreement (in years) | 2 years | |||||||
Threshold term of agreement (in years) | 10 years | |||||||
Warrants issued | 9,482,606 | 9,482,606 | 9,482,606 | 9,482,606 | ||||
Exercise price (in dollars per share) | $ / shares | $ 15.17 | $ 15.17 | $ 15.17 | $ 15.17 | ||||
Warrants vested | 632,183 | 758,608 | 758,608 | 252,869 | ||||
Number of warrants that vest on achievement of each milestone (in shares) | 63,217 | |||||||
Milestone achievement for warrants to vest | $ | $ 8,000 | $ 8,000 | $ 8,000 | $ 8,000 | ||||
Apollo Global Management, Inc. and its Subsidiaries | ||||||||
Exercise price (in dollars per share) | $ / shares | $ 0.0005 | |||||||
Common stock-par value (in dollars per share) | $ / shares | $ 0 | |||||||
Equity interest issued or Issuable, number of shares | 5,326,755 | |||||||
Warrants issued (in shares) | 40,005,885 |
COMPANY BACKGROUND - Equity Tra
COMPANY BACKGROUND - Equity Transactions (Details) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Jan. 31, 2020 shares | Dec. 31, 2018 USD ($) stockholder $ / shares shares | Dec. 31, 2022 $ / shares | Dec. 31, 2021 $ / shares | |
Common stock-par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | ||
Apollo Global Management, Inc. and its Subsidiaries | ||||
Equity interest issued or Issuable, number of shares | 5,326,755 | |||
Common stock-par value (in dollars per share) | $ / shares | $ 0 | |||
Warrants issued (in shares) | 40,005,885 | |||
Exercise price (in dollars per share) | $ / shares | $ 0.0005 | |||
Initial Public Offering (in shares) | 1,416,645 | |||
Warrants exercised | 40,005,885 | |||
Notes Issued | $ | $ 3,500 | |||
Number of stockholders | stockholder | 2 |
COMPANY BACKGROUND- Stock split
COMPANY BACKGROUND- Stock split (Details) | 1 Months Ended | ||
Mar. 31, 2021 shares | Dec. 31, 2022 $ / shares | Dec. 31, 2021 $ / shares | |
COMPANY BACKGROUND | |||
Stock split ratio | 18.8886 | ||
Common stock-par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | |
Share issued as a result of stock split (in shares) | shares | 44,226,587 |
COMPANY BACKGROUND - Initial Pu
COMPANY BACKGROUND - Initial Public Offering (Details) | 1 Months Ended | 6 Months Ended | 12 Months Ended | ||||||||||
Mar. 19, 2021 USD ($) shares | Mar. 17, 2021 shares | Mar. 16, 2021 $ / shares shares | Dec. 13, 2019 USD ($) $ / shares shares | Dec. 13, 2019 USD ($) $ / shares shares | Dec. 13, 2019 USD ($) item $ / shares shares | Dec. 13, 2019 USD ($) extension $ / shares shares | Oct. 31, 2021 $ / shares shares | May 31, 2021 $ / shares shares | Oct. 31, 2021 USD ($) $ / shares | Dec. 31, 2022 USD ($) shares | Dec. 31, 2021 USD ($) $ / shares shares | Dec. 31, 2020 USD ($) shares | |
Offering expenses | $ | $ 1,763,000 | $ 0 | $ 8,384,000 | $ 0 | |||||||||
Sale of Stock, Consideration Received on Transaction | $ | $ 0 | ||||||||||||
Amazon Agreement | |||||||||||||
Term of agreement (in years) | 6 years | ||||||||||||
Number of extension option | 2 | 2 | |||||||||||
Term of renewal agreement (in years) | 2 years | ||||||||||||
Threshold term of agreement (in years) | 10 years | ||||||||||||
Warrants issued | 9,482,606 | 9,482,606 | 9,482,606 | 9,482,606 | |||||||||
Exercise price (in dollars per share) | $ / shares | $ 15.17 | $ 15.17 | $ 15.17 | $ 15.17 | |||||||||
Warrants vested | 632,183 | 758,608 | 758,608 | 252,869 | |||||||||
Number of warrants that vest on achievement of each milestone (in shares) | 63,217 | ||||||||||||
Milestone achievement for warrants to vest | $ | $ 8,000,000 | $ 8,000,000 | $ 8,000,000 | $ 8,000,000 | |||||||||
Vested warrants held (in shares) | 2,402,268 | ||||||||||||
Apollo Stockholder | |||||||||||||
Shares issued (in shares) | 7,250,000 | ||||||||||||
Share price (in dollars per share) | $ / shares | $ 34.50 | ||||||||||||
Apollo Stockholder | Chief Executive Officer | |||||||||||||
Shares issued (in shares) | 8,500,000 | ||||||||||||
Share price (in dollars per share) | $ / shares | $ 32.50 | $ 32.50 | |||||||||||
IPO | |||||||||||||
Shares issued (in shares) | 10,454,545 | 9,090,909 | |||||||||||
Share price (in dollars per share) | $ / shares | $ 24 | ||||||||||||
Proceeds from issuance of common stock | $ | $ 225,329,000 | ||||||||||||
Over-Allotment Option | |||||||||||||
Shares issued (in shares) | 1,363,636 | 435,291 | 1,087,500 | ||||||||||
Private Placement | |||||||||||||
Share price (in dollars per share) | $ / shares | $ 24 | ||||||||||||
Private Placement | Apollo Stockholder | P A R Investment Partners, L.P | |||||||||||||
Shares issued (in shares) | 2,216,312 | ||||||||||||
Aggregate purchase price | $ | $ 50,000,000 | ||||||||||||
Share price percentage of I P O share price | 94% | ||||||||||||
Private Placement | Apollo Stockholder | Certain funds or accounts managed by an investment adviser subsidiary of Blackrock, Inc | |||||||||||||
Shares issued (in shares) | 2,216,308 | ||||||||||||
Aggregate purchase price | $ | $ 50,000,000 | ||||||||||||
Share price percentage of I P O share price | 94% |
BASIS OF PRESENTATION AND SUM_4
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue Recognition (Details) | Dec. 13, 2019 item | Dec. 13, 2019 item | Dec. 13, 2019 extension item | Dec. 31, 2022 |
REVENUE | ||||
Travel credits (in years) | 12 months | |||
Amazon Agreement | ||||
REVENUE | ||||
Term of agreement (in years) | 6 years | |||
Number of extension option | 2 | 2 | ||
Term of renewal agreement (in years) | 2 years | |||
Threshold term of agreement (in years) | 10 years | |||
Notice of expiration (in days) | 180 days | |||
Performance obligations | 3 | 3 | 3 |
BASIS OF PRESENTATION AND SUM_5
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Restricted Cash (Details) | Dec. 31, 2022 |
Accounting Policies [Abstract] | |
Transportation, term (in months) | 12 months |
BASIS OF PRESENTATION AND SUM_6
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Accounts Receivable (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Accounts Receivable | |||
Accounts receivable | $ 35,124 | $ 30,156 | |
Amazon | |||
Accounts Receivable | |||
Accounts receivable | 1,000 | 2,163 | |
Accounts receivable write offs | $ 70 | $ 17 | $ 982 |
BASIS OF PRESENTATION AND SUM_7
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Inventory (Details) | Dec. 31, 2022 |
Parts Related to Flight Equipment | |
PROPERTY & EQUIPMENT | |
Estimated residual value (as a percent) | 10% |
BASIS OF PRESENTATION AND SUM_8
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property and Equipment (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
PROPERTY & EQUIPMENT | |||
Impairment of its long-lived assets | $ 0 | $ 0 | $ 0 |
Airframes | Minimum | |||
PROPERTY & EQUIPMENT | |||
Estimated useful life | 10 years | ||
Airframes | Maximum | |||
PROPERTY & EQUIPMENT | |||
Estimated useful life | 25 years | ||
Engines – Core | Minimum | |||
PROPERTY & EQUIPMENT | |||
Estimated useful life | 7 years | ||
Engines – Core | Maximum | |||
PROPERTY & EQUIPMENT | |||
Estimated useful life | 12 years | ||
Leasehold Improvements, Aircraft, Other | Minimum | |||
PROPERTY & EQUIPMENT | |||
Estimated useful life | 3 years | ||
Leasehold Improvements, Aircraft, Other | Maximum | |||
PROPERTY & EQUIPMENT | |||
Estimated useful life | 25 years | ||
Office and Ground Equipment | Minimum | |||
PROPERTY & EQUIPMENT | |||
Estimated useful life | 5 years | ||
Office and Ground Equipment | Maximum | |||
PROPERTY & EQUIPMENT | |||
Estimated useful life | 7 years | ||
Computer Hardware and Software | Minimum | |||
PROPERTY & EQUIPMENT | |||
Estimated useful life | 3 years | ||
Computer Hardware and Software | Maximum | |||
PROPERTY & EQUIPMENT | |||
Estimated useful life | 5 years | ||
Rotable Parts | Minimum | |||
PROPERTY & EQUIPMENT | |||
Estimated useful life | 6 years | ||
Rotable Parts | Maximum | |||
PROPERTY & EQUIPMENT | |||
Estimated useful life | 16 years |
BASIS OF PRESENTATION AND SUM_9
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Asset Impairment Analysis (Details) | 12 Months Ended | ||
Dec. 31, 2022 USD ($) aircraft | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Accounting Policies [Abstract] | |||
Number of aircraft types | aircraft | 1 | ||
Impairment of its long-lived assets | $ | $ 0 | $ 0 | $ 0 |
BASIS OF PRESENTATION AND SU_10
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Goodwill and Other Intangible Assets (Details) | 12 Months Ended | ||
Dec. 31, 2022 USD ($) item | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||
Number of reporting units | item | 2 | ||
Assets estimated life | 12 years | ||
Impairment losses | $ | $ 0 | $ 0 | $ 0 |
BASIS OF PRESENTATION AND SU_11
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Valuation of the Tax Receivable Agreement ("TRA") Liability (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Percentage of cash savings | 85% |
Percentage of cash savings retained | 15% |
BASIS OF PRESENTATION AND SU_12
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Concentration Risk (Details) | 12 Months Ended | |||
Jan. 04, 2023 | Dec. 31, 2022 employee item | Dec. 31, 2021 item | Dec. 31, 2020 item | |
ALPA | ||||
Concentration Risk | ||||
Number of active employees represented | 571 | |||
IBT | ||||
Concentration Risk | ||||
Number of active employees represented | 547 | |||
TWU | ||||
Concentration Risk | ||||
Number of active employees represented | 32 | |||
AMFA | ||||
Concentration Risk | ||||
Number of active employees represented | 177 | |||
Accounts Receivable | Customer Concentration Risk | Amazon | ||||
Concentration Risk | ||||
Percentage of concentration risk | 33% | 56% | ||
Accounts Receivable | Customer Concentration Risk | One Financial Institution | ||||
Concentration Risk | ||||
Percentage of concentration risk | 16% | 8% | ||
Cost of Goods and Service Benchmark | Supplier Concentration Risk | Two Vendors | ||||
Concentration Risk | ||||
Percentage of concentration risk | 69% | 54% | 57% | |
Number of vendors | item | 3 | 2 | 2 | |
Workforce Subject to Collective Bargaining Arrangements | Unionized Employees Concentration Risk | ||||
Concentration Risk | ||||
Percentage of concentration risk | 53% | |||
Number of unions | item | 4 | |||
Workforce Subject to Collective Bargaining Arrangements Expiring within One Year | Unionized Employees Concentration Risk | ||||
Concentration Risk | ||||
Percentage of concentration risk | 55% | |||
Workforce Subject to Collective Bargaining Arrangements Expiring within One Year | Unionized Employees Concentration Risk | Maximum | Subsequent Event | ||||
Concentration Risk | ||||
Percentage of concentration risk | 63% |
BASIS OF PRESENTATION AND SU_13
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revision of Previously Issued Consolidated Financial Statements (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Balance Sheet Related Disclosures [Abstract] | ||||
Total Property & Equipment | $ 962,413 | $ 695,587 | ||
Accumulated Depreciation & Amortization | (176,746) | (117,069) | ||
Total Property & Equipment, net | 785,667 | 578,518 | ||
Deferred Tax Assets | 12,956 | 17,608 | ||
Total Other Assets | 393,255 | 426,461 | ||
Total Assets | 1,524,412 | 1,380,422 | ||
Retained Earnings | 22,048 | 4,372 | ||
Total Stockholders' Equity | 492,712 | 490,589 | $ 283,817 | $ 283,724 |
Total Liabilities and Stockholders' Equity | 1,524,412 | 1,380,422 | ||
Income Statement [Abstract] | ||||
Depreciation and Amortization | 67,641 | 57,075 | 48,086 | |
Special Items, net | 0 | (72,419) | (64,563) | |
Total Operating Expenses | 511,068 | |||
Operating Income | 55,708 | 111,947 | 17,385 | |
Income Before Income Tax | 23,982 | 100,330 | (4,682) | |
Income Tax Expense | 6,306 | 19,082 | (778) | |
Net Income (Loss) | $ 17,676 | $ 81,248 | $ (3,904) | |
Basic (in dollars per share) | $ 0.31 | $ 1.47 | $ (0.08) | |
Diluted (in dollars per share) | $ 0.29 | $ 1.37 | $ (0.08) | |
Operating Activities | ||||
Non-Cash Gain on Asset Transaction, Net | $ (1,107) | $ (5) | $ 413 | |
Deferred Income Taxes | 4,893 | 18,609 | (789) | |
Operating Lease Obligations | (1,718) | (37,101) | (28,352) | |
Net Cash Provided by Operating Activities | 127,440 | 158,976 | 374 | |
Investing Activities | ||||
Purchases of Property & Equipment | (187,922) | (123,332) | (96,298) | |
Net Cash Used in Investing Activities | (349,330) | (123,936) | $ (96,028) | |
Aircraft and Flight Equipment | ||||
Balance Sheet Related Disclosures [Abstract] | ||||
Aircraft and Flight Equipment | $ 636,584 | 447,319 | ||
As Previously Issued | ||||
Balance Sheet Related Disclosures [Abstract] | ||||
Total Property & Equipment | 688,624 | |||
Accumulated Depreciation & Amortization | (115,013) | |||
Total Property & Equipment, net | 573,611 | |||
Deferred Tax Assets | 18,737 | |||
Total Other Assets | 427,590 | |||
Total Assets | 1,376,644 | |||
Retained Earnings | 594 | |||
Total Stockholders' Equity | 486,811 | |||
Total Liabilities and Stockholders' Equity | 1,376,644 | |||
Income Statement [Abstract] | ||||
Depreciation and Amortization | 55,019 | |||
Special Items, net | (65,456) | |||
Total Operating Expenses | 515,975 | |||
Operating Income | 107,040 | |||
Income Before Income Tax | 95,423 | |||
Income Tax Expense | 17,953 | |||
Net Income (Loss) | $ 77,470 | |||
Basic (in dollars per share) | $ 1.40 | |||
Diluted (in dollars per share) | $ 1.31 | |||
Operating Activities | ||||
Non-Cash Gain on Asset Transaction, Net | $ (12,673) | |||
Deferred Income Taxes | 17,480 | |||
Operating Lease Obligations | (24,433) | |||
Net Cash Provided by Operating Activities | 152,013 | |||
Investing Activities | ||||
Purchases of Property & Equipment | (116,369) | |||
Net Cash Used in Investing Activities | (116,973) | |||
As Previously Issued | Aircraft and Flight Equipment | ||||
Balance Sheet Related Disclosures [Abstract] | ||||
Aircraft and Flight Equipment | 440,356 | |||
Correction | ||||
Balance Sheet Related Disclosures [Abstract] | ||||
Total Property & Equipment | 6,963 | |||
Accumulated Depreciation & Amortization | (2,056) | |||
Total Property & Equipment, net | 4,907 | |||
Deferred Tax Assets | (1,129) | |||
Total Other Assets | (1,129) | |||
Total Assets | 3,778 | |||
Retained Earnings | 3,778 | |||
Total Stockholders' Equity | 3,778 | |||
Total Liabilities and Stockholders' Equity | 3,778 | |||
Income Statement [Abstract] | ||||
Depreciation and Amortization | 2,056 | |||
Special Items, net | (6,963) | |||
Total Operating Expenses | (4,907) | |||
Operating Income | 4,907 | |||
Income Before Income Tax | 4,907 | |||
Income Tax Expense | 1,129 | |||
Net Income (Loss) | $ 3,778 | |||
Basic (in dollars per share) | $ 0.07 | |||
Diluted (in dollars per share) | $ 0.06 | |||
Operating Activities | ||||
Non-Cash Gain on Asset Transaction, Net | $ 12,668 | |||
Deferred Income Taxes | 1,129 | |||
Operating Lease Obligations | (12,668) | |||
Net Cash Provided by Operating Activities | 6,963 | |||
Investing Activities | ||||
Purchases of Property & Equipment | (6,963) | |||
Net Cash Used in Investing Activities | (6,963) | |||
Correction | Aircraft and Flight Equipment | ||||
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 | 12 Months Ended | ||||
Oct. 26, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 30, 2022 | |
IMPACT OF THE COVID19 PANDEMIC | |||||
Grants recognized | $ 0 | $ 71,587 | $ 62,312 | ||
CARES Act employee retention credit | $ 0 | 848 | $ 2,328 | ||
CARES Act | |||||
IMPACT OF THE COVID19 PANDEMIC | |||||
Limit exceeded | $ 319 | ||||
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 - Disaggregation of Ope
REVENUE - Disaggregation of Operating Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
REVENUE | |||
Total Operating Revenue | $ 894,444 | $ 623,015 | $ 401,486 |
Domestic | |||
REVENUE | |||
Total Operating Revenue | 857,764 | 597,005 | 382,463 |
Latin America | |||
REVENUE | |||
Total Operating Revenue | 36,537 | 24,646 | 18,515 |
Other | |||
REVENUE | |||
Total Operating Revenue | 143 | 1,364 | 508 |
Passenger | |||
REVENUE | |||
Total Operating Revenue | 792,433 | 523,945 | 359,232 |
Scheduled service | |||
REVENUE | |||
Total Operating Revenue | 438,308 | 279,377 | 193,047 |
Charter service | |||
REVENUE | |||
Total Operating Revenue | 161,619 | 127,331 | 98,130 |
Ancillary | |||
REVENUE | |||
Total Operating Revenue | 192,506 | 117,237 | 68,055 |
Cargo | |||
REVENUE | |||
Total Operating Revenue | 90,350 | 91,428 | 36,809 |
Other | |||
REVENUE | |||
Total Operating Revenue | $ 11,661 | $ 7,642 | $ 5,445 |
REVENUE - Contract Balances (De
REVENUE - Contract Balances (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
REVENUE | |||
Total Contract Assets | $ 2,195 | $ 2,819 | |
Total Contract Liabilities | 176,703 | 142,480 | |
Air Traffic Liabilities | |||
REVENUE | |||
Total Contract Liabilities | 157,995 | 118,562 | |
Loyalty Program Liabilities | |||
REVENUE | |||
Total Contract Liabilities | 15,437 | 19,718 | $ 22,069 |
Amazon Deferred Up-front Payment | |||
REVENUE | |||
Total Contract Liabilities | 3,271 | 4,200 | |
Costs to fulfill contract with Amazon | |||
REVENUE | |||
Total Contract Assets | $ 2,195 | $ 2,819 |
REVENUE - Additional Informatio
REVENUE - Additional Information (Details) - USD ($) shares in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2022 | Dec. 31, 2019 | |
Costs to fulfill contract with Amazon | |||
REVENUE | |||
Deferred up-front costs amortization period (in years) | 6 years | 6 years | |
Amazon Deferred Up-front Payment | |||
REVENUE | |||
Proceeds from startup costs | $ 10,300 | ||
Warrants vested | 632,183 | ||
Fair value of warrants vested | 4,667 | $ 4,667 | |
Amazon Deferred Up-front Payment | Other Liabilities | |||
REVENUE | |||
Remaining start up costs | $ 5,633 | $ 5,633 | |
Passenger | Air Traffic Liabilities | |||
REVENUE | |||
Revenue recognized | $ 112,347 |
REVENUE - Loyalty Program (Deta
REVENUE - Loyalty Program (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Changes in the Loyalty Program Liabilities | ||
Balance - January 1 | $ 142,480 | |
Balance - December 31 | 176,703 | $ 142,480 |
Loyalty Program Liabilities | ||
Changes in the Loyalty Program Liabilities | ||
Balance - January 1 | 19,718 | 22,069 |
Loyalty Points Earned | 7,052 | 4,562 |
Loyalty Points Redeemed | (11,333) | (6,913) |
Balance - December 31 | 15,437 | 19,718 |
Air Traffic Liabilities | ||
Changes in the Loyalty Program Liabilities | ||
Balance - January 1 | 118,562 | |
Balance - December 31 | 157,995 | 118,562 |
Amazon Deferred Up-front Payment | ||
Changes in the Loyalty Program Liabilities | ||
Balance - January 1 | 4,200 | |
Balance - December 31 | $ 3,271 | $ 4,200 |
EARNINGS PER SHARE - Computatio
EARNINGS PER SHARE - Computation of basic and diluted earnings (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Numerator: | |||
Net Income (Loss) | $ 17,676 | $ 81,248 | $ (3,904) |
Denominator: | |||
Weighted Average Common Shares Outstanding - Basic (in shares) | 57,951,955 | 55,182,811 | 46,806,042 |
Dilutive effect of Stock Options, RSUs and Warrants (in shares) | 3,094,640 | 4,141,229 | 0 |
Diluted (in shares) | 61,046,595 | 59,324,040 | 46,806,042 |
Basic earnings (loss) per share (in dollars per share) | $ 0.31 | $ 1.47 | $ (0.08) |
Diluted earnings (loss) per share (in dollars per share) | $ 0.29 | $ 1.37 | $ (0.08) |
Performance-based stock options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Outstanding shares | 3,636,771 | 3,577,252 | |
Percentage of stock options expected to meet performance conditions | 59% | 75% | |
Vesting percentage | 32.50% |
AIRCRAFT - Aircraft fleet (Deta
AIRCRAFT - Aircraft fleet (Details) - aircraft | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
AIRCRAFT - Owned and Leased | ||
Balance at beginning of period | 48 | 43 |
Additions | 7 | 5 |
Reclassifications | 0 | 0 |
Removals | (1) | 0 |
Balance at end of period | 54 | 48 |
Number of aircrafts financed using finance lease arrangement | 2 | 4 |
Number of aircraft finance lease purchase options exercised | 2 | |
Number of aircrafts previously under operating leases | 6 | |
B-737-800 | ||
AIRCRAFT - Owned and Leased | ||
Balance at end of period | 53 | |
B-737-700 | ||
AIRCRAFT - Owned and Leased | ||
Balance at end of period | 1 | |
Passenger | ||
AIRCRAFT - Owned and Leased | ||
Balance at beginning of period | 36 | 31 |
Additions | 7 | 5 |
Reclassifications | 0 | 0 |
Removals | (1) | 0 |
Balance at end of period | 42 | 36 |
Number of new aircrafts purchased | 5 | |
Number of aircrafts financed | 26 | |
Number of aircrafts unencumbered | 3 | 1 |
Number of aircrafts transferred from operating to finance lease | 2 | |
Passenger | Owned | ||
AIRCRAFT - Owned and Leased | ||
Balance at beginning of period | 21 | 14 |
Additions | 5 | 1 |
Reclassifications | 4 | 6 |
Removals | (1) | 0 |
Balance at end of period | 29 | 21 |
Number of aircrafts previously under operating leases | 2 | |
Passenger | Finance leases | ||
AIRCRAFT - Owned and Leased | ||
Balance at beginning of period | 9 | 5 |
Additions | 2 | 4 |
Reclassifications | 0 | 0 |
Removals | 0 | 0 |
Balance at end of period | 11 | 9 |
Passenger | Operating leases | ||
AIRCRAFT - Owned and Leased | ||
Balance at beginning of period | 6 | 12 |
Additions | 0 | 0 |
Reclassifications | (4) | (6) |
Removals | 0 | 0 |
Balance at end of period | 2 | 6 |
Cargo | Aircraft Operated for Amazon | ||
AIRCRAFT - Owned and Leased | ||
Balance at beginning of period | 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 | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
AIRCRAFT - Owned and Leased | |||
Aircraft Rent | $ 8,768 | $ 17,653 | $ 30,989 |
Depreciation amortization and aircraft rent | 65,950 | 65,015 | 69,536 |
Owned | |||
AIRCRAFT - Owned and Leased | |||
Depreciation | 40,311 | 35,855 | 25,294 |
Operating leases | |||
AIRCRAFT - Owned and Leased | |||
Aircraft Rent | 8,768 | 17,653 | 30,989 |
Finance Lease Assets | |||
AIRCRAFT - Owned and Leased | |||
Amortization | $ 16,871 | $ 11,507 | $ 13,253 |
AIRCRAFT - Aircraft Maintenance
AIRCRAFT - Aircraft Maintenance Deposits Contra-Assets (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) aircraft | |
AIRCRAFT - Owned and Leased | ||
Number of aircrafts previously under operating leases | aircraft | 6 | |
Aircraft maintenance deposits contra assets | ||
AIRCRAFT - Owned and Leased | ||
Remaining unamortized balance contra assets | $ 13,211 | $ 22,348 |
Reduction in contra assets | 9,137 | |
Aircraft maintenance deposits contra assets | Owned | ||
AIRCRAFT - Owned and Leased | ||
Reduction in contra assets | $ 8,362 |
AIRCRAFT - Over-market Liabilit
AIRCRAFT - Over-market Liabilities (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 USD ($) aircraft | Dec. 31, 2021 USD ($) aircraft | |
AIRCRAFT - Owned and Leased | ||
Amount reclassified to finance lease | $ 9,687 | |
Number of aircrafts previously under operating leases | aircraft | 6 | |
Passenger | ||
AIRCRAFT - Owned and Leased | ||
Number of aircrafts transferred from operating to finance lease | aircraft | 2 | |
Passenger | Owned | ||
AIRCRAFT - Owned and Leased | ||
Remaining unamortized balance contra assets | $ 8,021 | |
Number of aircrafts previously under operating leases | aircraft | 2 | |
Over-market rent and maintenance reserves | ||
AIRCRAFT - Owned and Leased | ||
Remaining unamortized balance contra assets | $ 113 | $ 10,363 |
Decrease in purchase of aircrafts previously leased | 173 | |
Over market liabilities | 2,574 | $ 14,737 |
Increase (decrease) in over market maintenance reserve liabilities | 12,163 | |
Over market maintenance reserve liabilities, purchase of aircraft | 3,303 | |
Over-market rent and maintenance reserves | Owned | ||
AIRCRAFT - Owned and Leased | ||
Increase (decrease) in over market maintenance reserve liabilities | $ 6,023 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS - Components (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill | $ 222,223 | $ 222,223 |
Intangible Assets with Finite Lives: | ||
Gross Carrying Amount | 48,000 | 48,000 |
Accumulated Amortization | (18,890) | (14,890) |
Net Carrying Value | 29,110 | 33,110 |
Total Other Intangible Assets | ||
Gross Carrying Amount | 104,000 | 104,000 |
Total Other Intangible Assets | 85,110 | 89,110 |
Total Goodwill and Other Intangible Assets, Gross Carrying Amount | 326,223 | 326,223 |
Total Goodwill and Other Intangible Assets, Net Carrying Value | 307,333 | 311,333 |
Tradename | ||
Intangible Assets with Indefinite Lives: | ||
Tradename | $ 56,000 | $ 56,000 |
GOODWILL AND OTHER INTANGIBLE_4
GOODWILL AND OTHER INTANGIBLE ASSETS - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense | $ 4,000 | $ 4,000 | $ 4,000 |
Annual amortization expense fiscal year maturity | |||
Year one | 4,000 | ||
Year two | 4,000 | ||
Year three | 4,000 | ||
Year four | 4,000 | ||
Year five | 4,000 | ||
Thereafter | $ 9,110 |
DEBT - Credit Facilities (Detai
DEBT - Credit Facilities (Details) $ in Thousands | 9 Months Ended | 12 Months Ended | |||
Feb. 10, 2021 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) aircraft | Dec. 31, 2020 USD ($) | |
DEBT | |||||
Number of aircrafts previously under operating leases | aircraft | 6 | ||||
Loss on extinguishment of debt | $ (1,557) | $ (1,224) | $ 0 | ||
Prior revolving credit agreement | |||||
DEBT | |||||
Maximum borrowing capacity | $ 25,000 | ||||
Credit Facilities | |||||
DEBT | |||||
Term of debt | 5 years | ||||
Minimum EBITDAR required to be maintained | $ 87,700 | ||||
Minimum liquidity required to be maintained | 30,000 | ||||
Credit Facilities | Base Rate | Minimum | |||||
DEBT | |||||
Margin (as a percent) | 4% | ||||
Credit Facilities | Base Rate | Maximum | |||||
DEBT | |||||
Margin (as a percent) | 5% | ||||
Revolving Credit Facility | |||||
DEBT | |||||
Maximum borrowing capacity | $ 25,000 | ||||
Commitment fee on unused facility (as a percent) | 0.50% | ||||
Revolving Credit Facility | Revolving Credit Facility | Line of Credit | |||||
DEBT | |||||
Line of credit facility, amount available | 24,650 | 24,650 | |||
Delayed Draw Term Loan Facility | |||||
DEBT | |||||
Maximum borrowing capacity | $ 90,000 | ||||
Amount of draw | $ 80,500 | ||||
Amount drawn | $ 0 | $ 0 |
DEBT - Long-term Debt (Details)
DEBT - Long-term Debt (Details) | 12 Months Ended | |||
Dec. 31, 2022 USD ($) aircraft | Dec. 31, 2020 aircraft | Mar. 31, 2022 USD ($) | Dec. 31, 2019 USD ($) | |
Notes payable under the Company's 2019-1 EETC agreement | ||||
DEBT | ||||
Face amount | $ | $ 248,587,000 | |||
Number of used aircrafts purchased or refinanced | 13 | |||
2022-1 EETC Agreement Notes Payable | Notes Payable, Other Payables | ||||
DEBT | ||||
Face amount | $ | $ 188,277,000 | |||
Number of aircraft financed by debt issuance | 13 | |||
Debt issuance costs | $ | $ 2,570,000 | |||
Number of aircraft owned and previously financed by DDTL | 5 | |||
Number of aircraft owned | 2 | |||
Number of aircraft acquired incrementally | 4 | |||
Number of aircraft bought-out from existing finance lease | 2 | |||
Interest expense capitalized | $ | $ 3,074,000 |
DEBT - Long-term Debt schedule
DEBT - Long-term Debt schedule (Details) - USD ($) | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2019 |
DEBT | ||||
Total Debt | $ 355,716,000 | $ 280,931,000 | ||
Less: Unamortized debt issuance costs | (3,481,000) | (3,505,000) | ||
Less: Current Maturities of Long-term Debt | (57,548,000) | (29,412,000) | ||
Total Long-term Debt | 294,687,000 | 248,014,000 | ||
Notes payable under the Company's 2019-1 EETC agreement | ||||
DEBT | ||||
Total Debt | $ 176,697,000 | 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 | ||||
DEBT | ||||
Interest rate | 4.13% | |||
Notes payable under the Company's 2019-1 EETC agreement | Maximum | ||||
DEBT | ||||
Interest rate | 6.95% | |||
2022-1 EETC Agreement Notes Payable | Notes Payable, Other Payables | ||||
DEBT | ||||
Total Debt | $ 179,019,000 | 0 | ||
Face amount | $ 188,277,000 | |||
Weighted average interest rate | 5.06% | |||
2022-1 EETC Agreement Notes Payable | Minimum | Notes Payable, Other Payables | ||||
DEBT | ||||
Interest rate | 4.84% | |||
2022-1 EETC Agreement Notes Payable | Maximum | Notes Payable, Other Payables | ||||
DEBT | ||||
Interest rate | 5.75% | |||
Delayed Draw Term Loan Facility | ||||
DEBT | ||||
Total Debt | $ 0 | 77,481,000 | ||
Notes Payable, Other Payables | ||||
DEBT | ||||
Total Debt | $ 0 | $ 466,000 |
DEBT - Future maturities of the
DEBT - Future maturities of the outstanding Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Principal Payments | ||
2023 | $ 58,518 | |
2024 | 60,157 | |
2025 | 65,241 | |
2026 | 45,668 | |
2027 | 47,999 | |
Thereafter | 78,133 | |
Total | 355,716 | $ 280,931 |
Amortization of Debt Issuance Costs | ||
2023 | (970) | |
2024 | (785) | |
2025 | (608) | |
2026 | (420) | |
2027 | (302) | |
Thereafter | (396) | |
Total | (3,481) | $ (3,505) |
Net Debt | ||
2023 | 57,548 | |
2024 | 59,372 | |
2025 | 64,633 | |
2026 | 45,248 | |
2027 | 47,697 | |
Thereafter | 77,737 | |
Total | $ 352,235 |
DEBT - Measured at fair value (
DEBT - Measured at fair value (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Disclosure [Abstract] | ||
Fair value | $ 324,059 | $ 272,004 |
LEASES - Summary (Details)
LEASES - Summary (Details) | 12 Months Ended | |
Dec. 31, 2022 USD ($) lease | Dec. 31, 2021 USD ($) | |
Finance Leases | ||
Number of categories in operating leases | lease | 3 | |
Initial terms | 6 years | |
Operating lease assets | $ | $ 22,182,000 | $ 61,658,000 |
Lease liability | $ | $ 26,132,000 | |
Aircraft | ||
Finance Leases | ||
Number of leases for aircraft | lease | 13 | |
Number of leases under finance leases | lease | 11 | |
Number of leases under Right-of-use operating leases | lease | 2 | |
Lease liability | $ | $ 6,458,000 | |
Real Estate | ||
Finance Leases | ||
Lease liability | $ | $ 19,674,000 | |
Real Estate | Maximum | ||
Finance Leases | ||
Initial terms | 10 years | |
Aircraft Operated for Amazon | ||
Finance Leases | ||
Number of freighters subleased directly | lease | 12 | |
Operating lease assets | $ | $ 0 |
LEASES - Lease-related assets a
LEASES - Lease-related assets and liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Assets | ||
Finance lease assets, net | $ 221,727 | $ 181,097 |
Operating lease assets | 22,182 | 61,658 |
Total lease assets | 243,909 | 242,755 |
Liabilities | ||
Short-term Finance Lease Obligations | 17,990 | 11,705 |
Short-term Operating Lease Obligations | 6,296 | 17,231 |
Long-term Lease Obligations | 233,306 | 180,450 |
Long-term Lease Obligations | 19,836 | 58,810 |
Total lease liabilities | $ 277,428 | $ 268,196 |
LEASES - Finance lease obligati
LEASES - Finance lease obligations (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Finance Leases | ||
2023 | $ 33,092 | |
2024 | 33,631 | |
2025 | 33,853 | |
2026 | 72,650 | |
2027 | 22,377 | |
Thereafter | 125,706 | |
Total Minimum Lease Payments | 321,309 | |
Less: Amount Representing Interest | (70,013) | |
Present Value of Minimum Lease Payments | 251,296 | |
Less: Short-term Obligations | (17,990) | $ (11,705) |
Long-term Lease Obligations | 233,306 | $ 180,450 |
Aircraft | ||
Finance Leases | ||
2023 | 31,600 | |
2024 | 32,080 | |
2025 | 32,080 | |
2026 | 70,877 | |
2027 | 20,604 | |
Thereafter | 122,527 | |
Total Minimum Lease Payments | 309,768 | |
Less: Amount Representing Interest | (66,652) | |
Present Value of Minimum Lease Payments | 243,116 | |
Less: Short-term Obligations | (17,309) | |
Long-term Lease Obligations | 225,807 | |
Real Estate | ||
Finance Leases | ||
2023 | 1,492 | |
2024 | 1,551 | |
2025 | 1,773 | |
2026 | 1,773 | |
2027 | 1,773 | |
Thereafter | 3,179 | |
Total Minimum Lease Payments | 11,541 | |
Less: Amount Representing Interest | (3,361) | |
Present Value of Minimum Lease Payments | 8,180 | |
Less: Short-term Obligations | (681) | |
Long-term Lease Obligations | $ 7,499 |
LEASES - Operating lease obliga
LEASES - Operating lease obligations (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Operating Leases | ||
2023 | $ 7,748 | |
2024 | 5,674 | |
2025 | 3,273 | |
2026 | 3,296 | |
2027 | 3,306 | |
Thereafter | 8,722 | |
Total Minimum Lease Payments | 32,019 | |
Less: Amount Representing Interest | (5,887) | |
Present Value of Minimum Lease Payments | 26,132 | |
Less: Short-term Obligations | (6,296) | $ (17,231) |
Long-term Lease Obligations | 19,836 | $ 58,810 |
Aircraft | ||
Operating Leases | ||
2023 | 4,382 | |
2024 | 2,392 | |
2025 | 0 | |
2026 | 0 | |
2027 | 0 | |
Thereafter | 0 | |
Total Minimum Lease Payments | 6,774 | |
Less: Amount Representing Interest | (316) | |
Present Value of Minimum Lease Payments | 6,458 | |
Less: Short-term Obligations | (4,111) | |
Long-term Lease Obligations | 2,347 | |
Real Estate | ||
Operating Leases | ||
2023 | 3,366 | |
2024 | 3,282 | |
2025 | 3,273 | |
2026 | 3,296 | |
2027 | 3,306 | |
Thereafter | 8,722 | |
Total Minimum Lease Payments | 25,245 | |
Less: Amount Representing Interest | (5,571) | |
Present Value of Minimum Lease Payments | 19,674 | |
Less: Short-term Obligations | (2,185) | |
Long-term Lease Obligations | $ 17,489 |
LEASES - Lease cost (Details)
LEASES - Lease cost (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Finance lease cost | |||
Amortization of leased assets | $ 17,900 | $ 12,536 | $ 11,948 |
Interest on lease liabilities | 13,782 | 8,021 | 8,659 |
Operating lease cost | |||
Short-term | 691 | 277 | 1,813 |
Total Lease cost | 45,980 | 43,396 | 57,517 |
Over-market rent and maintenance reserves | |||
Operating lease cost | |||
Credits for amortization of Over-market Liabilities | 3,228 | 7,609 | 14,110 |
Aircraft | |||
Operating lease cost | |||
Included in ROU asset | 8,465 | 18,608 | 30,717 |
Variable - Aircraft | (388) | (1,232) | (1,541) |
Other | |||
Operating lease cost | |||
Included in ROU asset | 3,692 | 3,976 | 4,872 |
Variable - Other | $ 1,838 | $ 1,210 | $ 1,049 |
LEASES - Supplemental cash flow
LEASES - Supplemental cash flow information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash paid for amounts included in the measurement of lease liabilities: | |||
Operating Cash Flows for Operating Leases | $ 12,378 | $ 29,360 | $ 34,576 |
Operating Cash Flows for Finance Leases | 13,782 | 8,021 | 8,659 |
Financing Cash Flows for Finance Leases | $ 42,062 | $ 11,931 | $ 89,697 |
LEASES - Terms and discount rat
LEASES - Terms and discount rates (Details) | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Leases [Abstract] | |||
Weighted-average remaining lease term, operating leases | 5 years 10 months 24 days | 4 years 7 months 6 days | 4 years 9 months 18 days |
Weighted-average remaining lease term, finance leases | 6 years 1 month 6 days | 7 years 2 months 12 days | 8 years 7 months 6 days |
Weighted-average discount rates, operating leases | 6.30% | 6% | 6% |
Weighted-average discount rates, finance leases | 6.20% | 6.10% | 6.10% |
LEASES - Additional disclosures
LEASES - Additional disclosures (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | |||
Maintenance reserve payments expensed | $ 2,191 | $ 4,004 | $ 8,691 |
STOCK-BASED COMPENSATION - Addi
STOCK-BASED COMPENSATION - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2021 | |
STOCK-BASED COMPENSATION | ||||
Stock compensation expense | $ 2,774 | $ 5,562 | $ 2,110 | |
Tax benefit recognized | 1,032 | 3,619 | ||
Total unrecognized compensation expense, expected to be recognized | $ 4,583 | |||
Award term (in years) | 2 years 2 months 12 days | |||
Intrinsic value of stock options exercised | $ 3,468 | 18,621 | ||
Time-Based Stock Options | ||||
STOCK-BASED COMPENSATION | ||||
Expiration period | 10 years | |||
Vesting percentage each year over four years | 25% | |||
Initial vesting period from grant date | 4 years | |||
Restricted Stock Units (RSUs) | ||||
STOCK-BASED COMPENSATION | ||||
Award term (in years) | 3 years | |||
Vested (in shares) | 17,035 | |||
Restricted stock units vested | $ 441 | |||
Performance-based stock options | ||||
STOCK-BASED COMPENSATION | ||||
Stock compensation expense | $ 3,804 | |||
Intrinsic value of stock options exercised | $ 2,511 | |||
Equity incentive plan | ||||
STOCK-BASED COMPENSATION | ||||
Available for grant | 3,276,169 | |||
Equity incentive plan | Maximum | ||||
STOCK-BASED COMPENSATION | ||||
Authorized | 3,600,000 |
STOCK-BASED COMPENSATION - Stoc
STOCK-BASED COMPENSATION - Stock option activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Time-Based Stock Options | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding [Roll Forward] | ||||
Outstanding at beginning of period (in shares) | 1,653,943 | 2,329,461 | 2,281,308 | |
Granted (in shares) | 0 | 62,080 | 221,941 | |
Forfeited (in shares) | (119,605) | (18,613) | (173,788) | |
Exercised (in shares) | (177,816) | (718,985) | ||
Outstanding at end of period (in shares) | 1,356,522 | 1,653,943 | 2,329,461 | 2,281,308 |
Exercisable at end of period (in shares) | 1,214,803 | |||
Vested or expected to vest, at end of period (in shares) | 1,356,522 | |||
Weighted average exercise price per share | ||||
Outstanding at beginning of period (in dollars per share) | $ 7.57 | $ 6.36 | $ 5.84 | |
Granted (in dollars per share) | 0 | 33.10 | 17.99 | |
Forfeited (in dollars per share) | 20.09 | 11.75 | 14.65 | |
Exercised (in dollars per share) | 5.63 | 5.89 | ||
Outstanding at end of period (in dollars per share) | 6.72 | 7.57 | 6.36 | $ 5.84 |
Exercisable at end of period (in dollars per share) | 6.12 | |||
Vested or expected to vest, at end of period (in dollars per share) | 6.72 | |||
Weighted average grant date fair value | ||||
Outstanding at beginning of period (in dollars per share) | 3.22 | 2.74 | 2.54 | |
Granted (in dollars per share) | 0 | 13.47 | 7.02 | |
Forfeited (in dollars per share) | 8.03 | 5.15 | 5.70 | |
Exercised (in dollars per share) | 2.49 | 2.56 | ||
Outstanding at end of period (in dollars per share) | 2.89 | $ 3.22 | $ 2.74 | $ 2.54 |
Exercisable at end of period (in dollars per share) | 2.65 | |||
Vested or expected to vest, at end of period (in dollars per share) | $ 2.89 | |||
Weighted average remaining contractual term (years) | ||||
Weighted average remaining contractual term, outstanding (in years) | 6 years 1 month 6 days | 7 years 2 months 12 days | 7 years 7 months 6 days | 9 years |
Aggregate Intrinsic Value (in thousands) | ||||
Outstanding as of December 31, 2022 | $ 12,950 | |||
Exercisable as of December 31, 2022 | 12,084 | |||
Vested or expected to vest, December 31, 2022 | $ 12,950 | |||
Performance-based stock options | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding [Roll Forward] | ||||
Outstanding at beginning of period (in shares) | 3,636,771 | 3,577,252 | 3,502,947 | |
Granted (in shares) | 0 | 99,167 | 346,984 | |
Forfeited (in shares) | (307,894) | (39,648) | (272,679) | |
Exercised (in shares) | (150,344) | |||
Outstanding at end of period (in shares) | 3,178,533 | 3,636,771 | 3,577,252 | 3,502,947 |
Exercisable at end of period (in shares) | 964,635 | |||
Vested or expected to vest, at end of period (in shares) | 1,888,049 | |||
Weighted average exercise price per share | ||||
Outstanding at beginning of period (in dollars per share) | $ 7.10 | $ 6.38 | $ 5.86 | |
Granted (in dollars per share) | 0 | 33.10 | 17.99 | |
Forfeited (in dollars per share) | 14.13 | 6.89 | 14.65 | |
Exercised (in dollars per share) | 6.55 | |||
Outstanding at end of period (in dollars per share) | 6.45 | 7.10 | 6.38 | $ 5.86 |
Exercisable at end of period (in dollars per share) | 6.64 | |||
Vested or expected to vest, at end of period (in dollars per share) | 6.45 | |||
Weighted average grant date fair value | ||||
Outstanding at beginning of period (in dollars per share) | 1.53 | 1.72 | 1.61 | |
Granted (in dollars per share) | 0 | 10.08 | 4.36 | |
Forfeited (in dollars per share) | 4.43 | 1.67 | 3.59 | |
Exercised (in dollars per share) | 1.74 | |||
Outstanding at end of period (in dollars per share) | 1.83 | $ 1.53 | $ 1.72 | $ 1.61 |
Exercisable at end of period (in dollars per share) | 1.93 | |||
Vested or expected to vest, at end of period (in dollars per share) | $ 1.83 | |||
Weighted average remaining contractual term (years) | ||||
Weighted average remaining contractual term, outstanding (in years) | 6 years 1 month 6 days | 7 years 2 months 12 days | 7 years 7 months 6 days | 9 years |
Aggregate Intrinsic Value (in thousands) | ||||
Outstanding as of December 31, 2022 | $ 30,793 | |||
Exercisable as of December 31, 2022 | 9,322 | |||
Vested or expected to vest, December 31, 2022 | $ 18,291 | |||
Percentage of stock options expected to meet performance conditions | 59% | 75% |
STOCK-BASED COMPENSATION - Blac
STOCK-BASED COMPENSATION - Black-Scholes option pricing model (Details) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | ||
Expected Term | 5 years 1 month 6 days | 5 years 7 months 6 days |
Expected Volatility | 34% | 38.80% |
Risk-free Interest Rate | 1.20% | 1.70% |
Expected Dividend Yield | 0% | 0% |
STOCK-BASED COMPENSATION - Rest
STOCK-BASED COMPENSATION - Restricted Stock Units (Details) - Restricted Stock Units (RSUs) - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Number of shares | ||
Outstanding, beginning balance (in shares) | 4,679 | 0 |
Granted (in shares) | 248,025 | 7,634 |
Forfeited (in shares) | (5,478) | (2,955) |
Vested (in shares) | (17,035) | |
Outstanding, ending balance (in shares) | 230,191 | 4,679 |
Weighted average grant date fair value | ||
Outstanding, Weighted average grant date fair value, beginning balance (in dollars per share) | $ 40.60 | $ 0 |
Granted, Weighted average grant date fair value (in dollars per share) | 20.44 | 40.60 |
Forfeited, Weighted average grant date fair value (in dollars per share) | 23.04 | 40.60 |
Vested, Weighted average grant date fair value (in dollars per share) | 25.87 | |
Outstanding, Weighted average grant date fair value, ending balance (in dollars per share) | $ 20.39 | $ 40.60 |
DEFINED CONTRIBUTION 401(k) P_3
DEFINED CONTRIBUTION 401(k) PLAN (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
DEFINED CONTRIBUTION 401(K) PLAN | |||
Employee's maximum contribution allowed (as a percent) | 50% | ||
Matching contribution of participants' contribution (as a percent) | 100% | ||
Non-discretionary contribution for pilots based on gross earnings | 13% | ||
Non-discretionary contributions 2023 | 14% | ||
Non-discretionary contributions 2024 | 15% | ||
Non-Discretionary | $ 13,692 | $ 1,187 | $ 1,040 |
Discretionary | 2,730 | 5,220 | 4,263 |
Total 401(k) Contributions | $ 16,422 | $ 6,407 | $ 5,303 |
Non Pilot Employees | |||
DEFINED CONTRIBUTION 401(K) PLAN | |||
Maximum contribution as a percent of participants' compensation | 4% | ||
Pilot Employees | |||
DEFINED CONTRIBUTION 401(K) PLAN | |||
Maximum contribution as a percent of participants' compensation | 6% |
FUEL DERIVATIVES AND RISK MAN_3
FUEL DERIVATIVES AND RISK MANAGEMENT - Narrative (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Fuel Derivative Contracts | ||
FUEL DERIVATIVES AND RISK MANAGEMENT | ||
Outstanding derivative contracts | $ 0 | $ 0 |
FUEL DERIVATIVES AND RISK MAN_4
FUEL DERIVATIVES AND RISK MANAGEMENT (Details) - Fuel Derivative Contracts - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Changes in Derivative Assets (Liabilities) | |||
Balance - January 1 | $ 0 | $ (1,174) | |
Non-cash Gains (Losses) | 0 | 3,527 | |
Contract Settlements | 0 | (2,353) | |
Balance - End of period | 0 | 0 | $ (1,174) |
Fuel Derivative Gains (Losses) | |||
Non-cash Gains (Losses) | 0 | 3,527 | (12,206) |
Cash Premiums Paid | 0 | 0 | (2,053) |
Total Fuel Derivative Gains (Losses) | $ 0 | $ 3,527 | $ (14,259) |
INVESTMENTS (Details)
INVESTMENTS (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Securities, Available-for-Sale [Line Items] | ||
Amortized Cost | $ 173,683 | |
Gross Unrealized Gains | 19 | |
Gross Unrealized Losses | (1,067) | |
Fair Value | 172,635 | |
Municipal Debt Securities | ||
Debt Securities, Available-for-Sale [Line Items] | ||
Amortized Cost | 47,897 | |
Gross Unrealized Gains | 16 | |
Gross Unrealized Losses | (258) | |
Fair Value | 47,655 | |
Corporate Debt Securities | ||
Debt Securities, Available-for-Sale [Line Items] | ||
Amortized Cost | 93,460 | |
Gross Unrealized Gains | 1 | |
Gross Unrealized Losses | (683) | |
Fair Value | 92,778 | |
U.S. Government Agency Securities | ||
Debt Securities, Available-for-Sale [Line Items] | ||
Amortized Cost | 32,326 | |
Gross Unrealized Gains | 2 | |
Gross Unrealized Losses | (126) | |
Fair Value | 32,202 | |
Certificates of Deposit | ||
Debt Securities, Available-for-Sale [Line Items] | ||
Certificates of deposit | $ 6,301 | $ 6,283 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | $ 172,635 | |
Municipal Debt Securities | ||
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | 47,655 | |
Corporate Debt Securities | ||
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | 92,778 | |
U.S. Government Agency Securities | ||
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | 32,202 | |
Fair Value, Recurring | ||
FAIR VALUE MEASUREMENTS | ||
Cash & Cash Equivalents | 92,086 | $ 309,338 |
Total Available-for-Sale Securities | 172,635 | |
Total Assets Measured at Fair Value on a Recurring Basis | 264,721 | 309,338 |
Fair Value, Recurring | Municipal Debt Securities | ||
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | 47,655 | |
Fair Value, Recurring | Corporate Debt Securities | ||
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | 92,778 | |
Fair Value, Recurring | U.S. Government Agency Securities | ||
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | 32,202 | |
Fair Value, Recurring | Fair Value, Inputs, Level 1 | ||
FAIR VALUE MEASUREMENTS | ||
Cash & Cash Equivalents | 73,727 | 309,338 |
Total Available-for-Sale Securities | 0 | |
Total Assets Measured at Fair Value on a Recurring Basis | 73,727 | 309,338 |
Fair Value, Recurring | Fair Value, Inputs, Level 1 | Municipal Debt Securities | ||
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | 0 | |
Fair Value, Recurring | Fair Value, Inputs, Level 1 | Corporate Debt Securities | ||
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | 0 | |
Fair Value, Recurring | Fair Value, Inputs, Level 1 | U.S. Government Agency Securities | ||
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | 0 | |
Fair Value, Recurring | Fair Value, Inputs, Level 2 | ||
FAIR VALUE MEASUREMENTS | ||
Cash & Cash Equivalents | 18,359 | 0 |
Total Available-for-Sale Securities | 172,635 | |
Total Assets Measured at Fair Value on a Recurring Basis | 190,994 | 0 |
Fair Value, Recurring | Fair Value, Inputs, Level 2 | Municipal Debt Securities | ||
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | 47,655 | |
Fair Value, Recurring | Fair Value, Inputs, Level 2 | Corporate Debt Securities | ||
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | 92,778 | |
Fair Value, Recurring | Fair Value, Inputs, Level 2 | U.S. Government Agency Securities | ||
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | 32,202 | |
Fair Value, Recurring | Fair Value, Inputs, Level 3 | ||
FAIR VALUE MEASUREMENTS | ||
Cash & Cash Equivalents | 0 | 0 |
Total Available-for-Sale Securities | 0 | |
Total Assets Measured at Fair Value on a Recurring Basis | 0 | $ 0 |
Fair Value, Recurring | Fair Value, Inputs, Level 3 | Municipal Debt Securities | ||
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | 0 | |
Fair Value, Recurring | Fair Value, Inputs, Level 3 | Corporate Debt Securities | ||
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | 0 | |
Fair Value, Recurring | Fair Value, Inputs, Level 3 | U.S. Government Agency Securities | ||
FAIR VALUE MEASUREMENTS | ||
Total Available-for-Sale Securities | $ 0 |
INCOME TAXES - Components of In
INCOME TAXES - Components of Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current: | |||
Federal | $ 1,329 | $ 0 | $ 0 |
State and Local | 84 | 135 | 10 |
Total Current Tax Expense | 1,413 | 135 | 10 |
Deferred: | |||
Federal | 4,393 | 16,824 | (597) |
State and Local | 500 | 2,123 | (191) |
Total Deferred Tax Expense (Benefit) | 4,893 | 18,947 | (788) |
Total Income Tax Expense (Benefit) | $ 6,306 | $ 19,082 | $ (778) |
INCOME TAXES - Tax Rate Reconci
INCOME TAXES - Tax Rate Reconciliation (Details) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Expected Provision at Federal Statutory | |||
Expected Provision at Federal Statutory Tax Rate | 21% | 21% | 21% |
State Tax, net of Federal Impact | 1.90% | 1.80% | 3.10% |
Stock Compensation Benefit | (4.30%) | (3.60%) | 0% |
Tax Receivable Agreement | 4.40% | (3.40%) | 0% |
Executive Compensation Limitation | 2% | 3% | 0% |
Employee Parking | 0.90% | 0.20% | (3.30%) |
Meals and Entertainment | 0% | 0% | (2.20%) |
Other Permanent Adjustments | 0.40% | 0% | (2.00%) |
Effective Tax Rate | 26.30% | 19% | 16.60% |
INCOME TAXES - Deferred taxes (
INCOME TAXES - Deferred taxes (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred Tax Assets: | ||
Net Operating Loss | $ 73,252 | $ 77,920 |
Operating Lease Obligations | 5,179 | 16,544 |
Finance Lease Obligations | 34,458 | 40,178 |
Goodwill and Other Intangible Assets | 6,812 | 9,699 |
Loyalty Program Liabilities | 3,459 | 4,407 |
Accrued Maintenance | 0 | 718 |
Other | 7,028 | 5,095 |
Total Deferred Tax Assets | 130,188 | 154,561 |
Deferred Tax Liabilities: | ||
Accelerated Depreciation | (78,749) | (81,120) |
Operating Lease Right-of-use Assets | (5,102) | (14,181) |
Finance Lease Assets | (30,492) | (41,652) |
Prepaid Maintenance | (1,986) | 0 |
Other | (903) | 0 |
Total Deferred Tax Liabilities | (117,232) | (136,953) |
Total Net Deferred Tax Assets | $ 12,956 | $ 17,608 |
INCOME TAXES - Additional Infor
INCOME TAXES - Additional Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Examination [Line Items] | ||
Federal net operating losses | $ 70,551,000 | |
State net operating losses | 2,701,000 | |
Liability for unrecognized tax benefits | $ 0 | $ 0 |
Percentage of cash savings | 85% | |
Percentage of cash savings retained | 15% | |
Tax receivable agreement liability non current | $ 115,200,000 | 98,800,000 |
Increase (decrease) in tax receivable agreement liability | (5,000,000) | $ 16,400,000 |
Maximum | ||
Income Tax Examination [Line Items] | ||
Tax receivable agreement liability non current | $ 103,800,000 |
STOCKHOLDERS' EQUITY (Details)
STOCKHOLDERS' EQUITY (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | ||
Jan. 31, 2023 | Dec. 31, 2022 | Oct. 31, 2022 | Dec. 31, 2021 | |
Class of Stock [Line Items] | ||||
Common stock-par value (in dollars per share) | $ 0.01 | $ 0.01 | ||
Subsequent Event | ||||
Class of Stock [Line Items] | ||||
Stock repurchased during period (in shares) | 480,932 | |||
Stocks repurchased, total (in shares) | 1,371,518 | |||
2022 Repurchase Program | ||||
Class of Stock [Line Items] | ||||
Stock repurchase program, authorized amount | $ 25,000 | $ 50,000 | ||
Stock repurchased during period (in shares) | 890,586 | |||
Accelerated share repurchases, initial (in dollars per share) | $ 19.65 | |||
Remaining authorized repurchase amount | $ 25,000 | |||
2022 Repurchase Program | Subsequent Event | ||||
Class of Stock [Line Items] | ||||
Accelerated share repurchases, initial (in dollars per share) | $ 18.23 |
SPECIAL ITEMS, NET - Schedule o
SPECIAL ITEMS, NET - Schedule of special items, net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Unusual or Infrequent Items, or Both [Abstract] | |||
CARES Act grant recognition (see Note 3) | $ 0 | $ (71,587) | $ (62,312) |
CARES Act employee retention credit (see Note 3) | 0 | (848) | (2,328) |
Other | 0 | 16 | 77 |
Total Special Items, net | $ 0 | $ (72,419) | $ (64,563) |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands | Dec. 31, 2022 USD ($) aircraft |
Purchase Commitment, Excluding Long-Term Commitment [Line Items] | |
Number of aircraft to lease | aircraft | 3 |
Annual lease payments | $ 32,019 |
Term of contract (in years) | 6 years |
Commitment to purchase an aircraft | $ 4,500 |
Commitments | |
Purchase Commitment, Excluding Long-Term Commitment [Line Items] | |
Annual lease payments | $ 2,000 |
OPERATING SEGMENTS (Details)
OPERATING SEGMENTS (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) segment item | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
OPERATING SEGMENTS | |||
Number of operating segments | segment | 2 | ||
Number of internal passenger groups | item | 2 | ||
Operating Revenues | $ 894,444 | $ 623,015 | $ 401,486 |
Non-Fuel Operating Expenses | 570,373 | 454,377 | 365,272 |
Aircraft Fuel | 268,363 | 129,110 | 83,392 |
Special Items, net | 0 | (72,419) | (64,563) |
Total Operating Expenses | 838,736 | 511,068 | 384,101 |
Operating Income (Loss) | 55,708 | 111,947 | 17,385 |
Interest Income | 4,527 | 85 | 377 |
Interest Expense | (31,018) | (26,326) | (22,073) |
Other, net | (5,235) | 14,624 | (371) |
Income (Loss) before Income Tax | 23,982 | 100,330 | (4,682) |
Passenger | |||
OPERATING SEGMENTS | |||
Operating Revenues | 804,094 | 531,587 | 364,677 |
Non-Fuel Operating Expenses | 479,968 | 385,580 | 332,742 |
Aircraft Fuel | 268,279 | 128,863 | 83,392 |
Special Items, net | (54,019) | (53,842) | |
Total Operating Expenses | 748,247 | 460,424 | 362,292 |
Operating Income (Loss) | 55,847 | 71,163 | 2,385 |
Cargo | |||
OPERATING SEGMENTS | |||
Operating Revenues | 90,350 | 91,428 | 36,809 |
Non-Fuel Operating Expenses | 90,405 | 68,797 | 32,530 |
Aircraft Fuel | 84 | 247 | 0 |
Special Items, net | (18,400) | (10,721) | |
Total Operating Expenses | 90,489 | 50,644 | 21,809 |
Operating Income (Loss) | $ (139) | $ 40,784 | $ 15,000 |
PARENT COMPANY FINANCIAL STAT_3
PARENT COMPANY FINANCIAL STATEMENTS - Impact of Revision on Previously Issued Condensed Parent Company (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Balance Sheet | |||
Total Assets | $ 1,524,412 | $ 1,380,422 | |
Retained Earnings | 22,048 | 4,372 | |
Total Liabilities and Stockholders' Equity | 1,524,412 | 1,380,422 | |
Income Statement [Abstract] | |||
Total Non-operating Income, net | (31,726) | (11,617) | $ (22,067) |
Income Before Income Tax | 23,982 | 100,330 | (4,682) |
Net Income (Loss) | 17,676 | 81,248 | (3,904) |
Parent Company | |||
Balance Sheet | |||
Investment in Subsidiary | 609,396 | 606,339 | |
Total Other Assets | 609,396 | 606,339 | |
Total Assets | 609,396 | 606,339 | |
Retained Earnings | 137,248 | 119,572 | |
Total Stockholders' Equity | 607,912 | 605,789 | |
Total Liabilities and Stockholders' Equity | 609,396 | 606,339 | |
Income Statement [Abstract] | |||
Equity in Income of Subsidiaries | 18,141 | 81,312 | (3,725) |
Total Non-operating Income, net | 18,141 | 81,312 | (3,725) |
Income Before Income Tax | 17,676 | 81,248 | (3,904) |
Net Income (Loss) | $ 17,676 | 81,248 | $ (3,904) |
As Previously Issued | |||
Balance Sheet | |||
Total Assets | 1,376,644 | ||
Retained Earnings | 594 | ||
Total Liabilities and Stockholders' Equity | 1,376,644 | ||
Income Statement [Abstract] | |||
Income Before Income Tax | 95,423 | ||
Net Income (Loss) | 77,470 | ||
As Previously Issued | Parent Company | |||
Balance Sheet | |||
Investment in Subsidiary | 602,561 | ||
Total Other Assets | 602,561 | ||
Total Assets | 602,561 | ||
Retained Earnings | 115,794 | ||
Total Stockholders' Equity | 602,011 | ||
Total Liabilities and Stockholders' Equity | 602,561 | ||
Income Statement [Abstract] | |||
Equity in Income of Subsidiaries | 77,534 | ||
Total Non-operating Income, net | 77,534 | ||
Income Before Income Tax | 77,470 | ||
Net Income (Loss) | 77,470 | ||
Correction | Parent Company | |||
Balance Sheet | |||
Investment in Subsidiary | 3,778 | ||
Total Other Assets | 3,778 | ||
Total Assets | 3,778 | ||
Retained Earnings | 3,778 | ||
Total Stockholders' Equity | 3,778 | ||
Total Liabilities and Stockholders' Equity | 3,778 | ||
Income Statement [Abstract] | |||
Equity in Income of Subsidiaries | 3,778 | ||
Total Non-operating Income, net | 3,778 | ||
Income Before Income Tax | 3,778 | ||
Net Income (Loss) | $ 3,778 |
PARENT COMPANY FINANCIAL STAT_4
PARENT COMPANY FINANCIAL STATEMENTS - Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Current Assets: | |||
Cash and Cash Equivalents | $ 92,086 | $ 309,338 | $ 62,028 |
Total Current Assets | 345,490 | 375,443 | |
Other Assets: | |||
Total Assets | 1,524,412 | 1,380,422 | |
Current Liabilities: | |||
Accounts Payable | 62,370 | 39,805 | |
Other Current Liabilities | 12,984 | 7,913 | |
Total Current Liabilities | 377,128 | 281,651 | |
Liabilities [Abstract] | |||
Other Long-term Liabilities | 2,690 | 3,413 | |
Total Liabilities | 1,031,700 | 889,833 | |
Stockholders' Equity: | |||
Common Stock | 582 | 579 | |
Additional Paid-In Capital | 488,494 | 485,638 | |
Accumulated Other Comprehensive Loss | (807) | 0 | |
Retained Earnings | 22,048 | 4,372 | |
Total Liabilities and Stockholders' Equity | 1,524,412 | 1,380,422 | |
Parent Company | |||
Current Assets: | |||
Cash and Cash Equivalents | 0 | 0 | |
Total Current Assets | 0 | 0 | |
Other Assets: | |||
Investment in Subsidiary | 609,396 | 606,339 | |
Total Other Assets | 609,396 | 606,339 | |
Total Assets | 609,396 | 606,339 | |
Current Liabilities: | |||
Accounts Payable | 0 | (1) | |
Other Current Liabilities | 16 | 57 | |
Total Current Liabilities | 16 | 56 | |
Liabilities [Abstract] | |||
Other Long-term Liabilities | 1,468 | 494 | |
Total Liabilities | 1,484 | 550 | |
Stockholders' Equity: | |||
Common Stock | 582 | 579 | |
Treasury Stock | (17,605) | 0 | |
Additional Paid-In Capital | 488,494 | 485,638 | |
Accumulated Other Comprehensive Loss | (807) | 0 | |
Retained Earnings | 137,248 | 119,572 | |
Total Stockholders' Equity | 607,912 | 605,789 | |
Total Liabilities and Stockholders' Equity | $ 609,396 | $ 606,339 |
PARENT COMPANY FINANCIAL STAT_5
PARENT COMPANY FINANCIAL STATEMENTS - Statements of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Operating Expenses: | |||
Other Operating Income (Expense), Net | $ 90,978 | $ 71,580 | $ 48,718 |
Costs and Expenses | 838,736 | 511,068 | 384,101 |
Operating Income | 55,708 | 111,947 | 17,385 |
Non-Operating Income Expense [Abstract] | |||
Other, net | (5,235) | 14,624 | (371) |
Total Non-operating Income (Expense), net | (31,726) | (11,617) | (22,067) |
Income (Loss) before Income Tax | 23,982 | 100,330 | (4,682) |
Income Tax Expense | 6,306 | 19,082 | (778) |
Net Income (Loss) | 17,676 | 81,248 | (3,904) |
Other Comprehensive Loss | (807) | 0 | 0 |
Comprehensive Income (Loss) | 16,869 | 81,248 | (3,904) |
Parent Company | |||
Operating Expenses: | |||
Other Operating Income (Expense), Net | 465 | 64 | 179 |
Costs and Expenses | 465 | 64 | 179 |
Operating Income | (465) | (64) | (179) |
Non-Operating Income Expense [Abstract] | |||
Equity in Income of Subsidiaries | 18,141 | 81,312 | (3,725) |
Other, net | 0 | 0 | 0 |
Total Non-operating Income (Expense), net | 18,141 | 81,312 | (3,725) |
Income (Loss) before Income Tax | 17,676 | 81,248 | (3,904) |
Income Tax Expense | 0 | 0 | 0 |
Net Income (Loss) | 17,676 | 81,248 | (3,904) |
Other Comprehensive Loss | (807) | 0 | 0 |
Comprehensive Income (Loss) | $ 16,869 | $ 81,248 | $ (3,904) |