ALGT - Earnings call transcript Q3 2018 | Allegiant Travel Company

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Operator

Good day, ladies and gentlemen, and welcome to the Q3 2018 Allegiant Travel Company Earnings Conference Call. At this time, all participants are in a listen-only mode.

Following management's prepared remarks, we will host a question-and-answer session and our instructions will be given at that time.

As a reminder, this conference call may be recorded. It is now pleasure to hand the conference over to Mr. Relations. Investor Allen, Chris proceed. may you Sir,

Christopher Allen

Thank you. earnings third XXXX Travel to Allegiant call. Company's quarter Welcome

call are of to Redmond, questions. On company's me Drew of Financial with the today others Operating Chief Planning; Chief Scott our Officer; Officer; and Officer President; handful and Chairman our Maury your Executive and & company's help John VP answer the Wells, Sheldon, Chief Revenue and the Gallagher, a

The that, earnings like we otherwise. be that obligation of to events information statements, reliance may John. as this forward-looking With new as call, site whether to not company's those assumptions the will information and visit it available future results statements fully on investors Relations questions. events, and are We by to or any on more factors implied a with or publicly up statements statements. underlying forward-looking SEC. release, feel turn are over the statements undertake To in based today and some strategic on the do I'd view of a forward-looking to assumptions materialize. ir.allegiantair.com. and this risk performance today us actual from our at company filings open then our free Any comments to well it as concerning others differ disclosed to start commentary forward-looking Various rebroadcast place could future contain result cause cautions which not of with expressed and undue our no These and these will to materially our based to forward-looking company's Investor The statements risk plan. factors update

John T. Redmond

everyone. course, Thank good you, Chris, and of afternoon,

the impressive without again issues with unprecedented, has fleet other with when given our in of an MD-XXs gone off Such Maury's So, few that is transition Thanksgiving, read and in a of course, of induction It a really special. all of is and after company through back part July. Starting an the course been problem that timeframe of has wow, significant year-to-date. the a particular, I a comments especially size what release quarter say impressive accomplishment. early and read coming can for out opening the the than transition I

course, transitions Of can't focus one movement hiring and overlook and but the put training individuals. the significant a so impacts planes of on that departments out, and many in

across board. incredible job entire team So, by the the

improved expectations rightsizing of high that XXXX Of performance same was and taking has and but the move any of the being now course, transition as airline line organization directed place, to all your with in of fleet into the while we beyond. incredible beyond that is our went into effort the performance improvement The standards.

and time of read dedication X.X. Allegiant foundation personnel times to of from those course, what's from the management last the on revenue programming full Touch time in the in reports Of the Investor substantially Very Sunseeker XXXX accomplished or of the effort to in relating Day, laid our reinvented. XXXX. But in the been do benefits reflect some has new ability in you and touch expected a read XXXX, course, do. given time, foundation of back when XXXX be months. provided any organizational what XXXX have is Investor by has to recent initiatives some the which end changes added, time. of complete been to been naysayers I we the company key for of will completed the its I just on questions business employees' during to course there, area set of couple of Part wanted the to with over on I now, All The to points made realized Sunseeker, the on bit nothing critical and processes be little get XX out so that something to a we doubt visibility base report. been Day frequent work IT out

We preview have of of center a expect a XXXX, the January opened by months. marketing so on to and site end couple in just

begin these targeted the XXXX We of dates expect previously Again, have communicated. in but vertical construction all XXXX. around October to of opening been February

currently XX. being December a hotel our at are headquarters. Our be Vegas model completed which Las guest should company standard We're in two-bedroom and suite built building rooms room by here a

So, to are product. Quickly, touch we'd after and base guidance. I to want this in whenever disclosures town of that love date, any you show you on

with XXXX in provide release. with that. Again, guidance the year-end that will you with consistent be will for expect to we continue XXXX disclosures Guidance provided conjunction earnings current release, with guidance that XXXX our and the full saw We for businesses. added non-airline in provided

in So, for the this release and we results operating for than find will disclosure our rather concern that analysis preopening we businesses, in forward. going expenses non-airline XXXX provided and you regard CapEx. the for With hope time, provide to first non-airline model worthwhile the of the your going businesses I business guidance

disclosed. each just year-to-date Drew. we it turn we what quarter on addition, will actuals have I'll the In similar provide and at And that, to of over end to

Drew Wells

and good afternoon, John Thank you, everyone.

summer. new the during that We the impact in important to involved of to comp believe eight environment that of as airport we the system to fourth the be including were recorded we service cents of new not continue the and the continued performance three In recognition TRASM quarter, scheduled it's Tucson, Albany, cities new length announced note including XXX. with Arizona, New we for to heavily fare July quarter. a George, load revenue would call our consecutive at rules. RM in negative discounted In pleased factor expansion new this aided St. we talked X.X Utah; the year. bringing year-over-year routes during have about August, I third service York; XXXX served the performance We total

in However, we September. previous very by performance return factor are by load to encouraged evidenced results the as the strong

about fourth as the headwinds factor system bounce we talked enter hurricanes Vegas the Florida stronger the and the had to bit. last headwind gains and with load a we noticeable quarter, for from back Turning But bookings the RM year a quarter. shooting that associated eased

a we best end with X%. strong XXXX. ASM the to QX, believe the of performance will end at of year-over-year As fourth saw the I up optimism quarter demand and fourth X% TRASM Obviously, looks the to the quarter contributor is at guidance TRASM

full the growth quarter will that, MD-XX fleet, turn limited rate, like aggressive the MD-XX to last our to questions. in as travel after December, retirement With I'd the particularly over we it complete right As of the a period. are be Thanksgiving fleet to to scheduled and we transition Airbus retire

Operator

Thank you.

first Our James. will with question come Raymond the from of Savi line Syth

now is open. line Your

Savanthi N. Syth

afternoon. good Hey,

of higher sized the guidance the especially expect kind what fuel broader be been over a characteristics specific market not you market, few smaller XXXX Just going to a years of a question, secondary kind of has environment? growth the little we forward, kind a for be of should bit leisure in And this may medium but the last destinations.

Drew Wells

Sure.

Primarily, growth that destinations have and I lot mid-sized connected. think So, continuing. dots out what exist cities to cities connecting the that today. There's be you'll origin including some will of towards yet look XXXX, that as the see be of is you a

least reconsider. rising at one in still even to fuel that's addition, network. cities We a be in think communicated current environment. we'll that at grow In we'll I before two certainly target mid-sized the environment, fuel new constantly If and cities a rises, the looking to year, the

Savanthi N. Syth

Thanks, is maintenance a I'm some I were Does events Should couple – That's of – maintenance Drew. just unlikely? maintenance pull some of next year in don't know helpful. expect of below XXXX. And it if Scott's somewhat or curious, around, we then, kind that forward that kind does from like there XXXX? average looks but

D. Scott Sheldon

Yeah. Hey, Yeah. some Savi. XQ. in kind of unique expenses There's

of that of kind that in fleet plane. fleet-wide the to MD-XX November. relates baseline There certain aspects end to kind of the Some also directly to were to order campaigns, some of of the get

the think through baseline you spec try you're wouldn't and going that continue. we're the to expect bay instance, normalize to APU fleet some For basis seeing expenses specifically we – on a to build some

we beyond. we aircraft per and of month kind as forward, look XXXX at per into kind move of directionally, cadence and the expect think $XX,XXX that's I what we

Savanthi N. Syth

of kind just below, to not average? return So,

D. Scott Sheldon

Yeah.

Savanthi N. Syth

Okay. Thank you.

Operator

Thank ISI. Evercore our the come next from will with you. And Duane question line Pfennigwerth of

line Your now is open.

Duane Pfennigwerth

Hey. Thanks. Good afternoon.

impact have you On X%, of one that accelerated the X% is remind number fleet you growth an from MD-XX there Was delays? a just retirements? at or XQ point to higher us, can rate

Drew Wells

this growth timeline once I set depends with reference we we've go been on at well there. decision to initial the point made guess, But reasonably aggressive your through November, it more rate. the

may a amount especially not up fuel us bit, little there as pullback ran a been So material small a have but on downward trend. of

Duane Pfennigwerth

tax what on rate, accounts quarter then or, in the Thanks. specifically? And for tax I negative third guess, implied the rate the lower

Gregory C. Anderson

is This Greg. Duane. Hey,

third which means production were internally that So refund our XXX is effectively, we is like to quarter, And able domestic take a the a that. on of take call we able it Section refund were on during developed what to activities. some software,

reduction the So you're that's that seeing. primarily

Duane Pfennigwerth

be going XX%. Does guidance initial go-forward normalized thinking kind of sort Is I year XX%, that impact it a forward? was, that tax So should rate what, we of basis? the your this think about on how

Gregory C. Anderson

year, I going first mean, think the reduction. I this to you're remainder of a for see

we the forward guidance XX% that in But what to tax the was probably year-to-date following guided, of right we updated think rate to the years, initially to XX%. XX% moving then is the forward. move So to more XX% as I

Duane Pfennigwerth

is I great. in could the quarter things. year $X like quick just almost some then in light maybe all new that's I that's what Maybe some disclosure And which this of on quarter third Okay. the other mean, year. some add I but appreciate, on grew to nonairline just OpEx It assume million third you math did million some I $X in it the from the looks business? Sunseeker about actually last think

for it's So you. us in what's a et maybe there, why give growing, Thank cetera. just sense

John T. Redmond

that all And you mentioned entities me Yeah. No there, you golf – the Sunseeker, look you problem, that the missing FEC. course acquired Kingsway see, yeah, let Teesnap, August am this Duane. in oh, have When you of I have currently what year. – in are the you we at

but no there revenue on focused is was components FEC I yet. revenue the So

seeing standpoint, there you're what revenue is Teesnap Teesnap from strictly and So Kingsway. a

we'll as provided now. we'll as amount entities much So going provide continue them. each to we've scale, greater detail of as those for individually forward, detail one a get consider providing And of

Duane Pfennigwerth

the basis? you OpEx, think Sunseeker I about belabor XXXX but on that point, to how like Not mean a would

John T. Redmond

the and that way These industry Day, for calls that. move The have, may on be at take guidance involved the material the It's operation. you When expenses to met to Jason. and going not like mean, going of another two that, we're look starts relate operating with have at some take that spent of least complete or would to introduced project give preopening. starts their the you expenses change it instance, to that two I are to you were at time on design the Micah you and that's the those Investor to individuals, to into gentlemen

essence, preopening. as their an is early So in closer as pay you expensed to get you date, pay, have opening But may their on. capitalized

expenses have be the rotating capitalized. the all you capitalized happen as on that's payroll people or expensed opposed start all marketing to to it. go have being you the to That's nature So, side are to expensed. you that being when of those start of of hiring as expenses see what and being as Then, course, and from early to

and So, think number substantial that is to a give Sunseeker not going going XXXX. we we'll guidance it's what for complete FY to on be range for be

Duane Pfennigwerth

Thank you.

John T. Redmond

No problem.

Operator

Thank come line our with next from Becker And will question of Helane the you. Cowen.

now is open. line Your

Helane Becker

for say pricing very that or the look a to structure? you've everybody. what percentage recapture is fuel at you do Thanks much, operator. of Hello. you way maybe your year-to-date, not Thank been Can able Hi, should time. we

Drew Wells

Yeah.

not customer our going to pricing. model. be to of So, and through not fuel to it's XXX% as simply business our core That's before, not commented recapture reacts we're how able we

But capacity part in make There the are that on the with earnest. us like call able and some particularly elements seeing. some of we're fuel out of day recapture strength getting the would to XQ one is be trims fringes to see in as certainly I yield off-peak, really week, season we're of of elements will to You the there. recapture

to ago. exact there, maybe some would So, we I'm put but environment beyond hesitant two or the are through recapturing an on a month what pricing have percentage I expected

Helane Becker

Okay.

those ancillaries through on is mean, even at to it does a just reasonable right? comments and like, or you follow-up of So, based sense? percentage could my the a – guess I look So, there's more made, percentage recapturing you combined not through I make is that fare,

Drew Wells

Yeah.

be very ancillary to So, sticky. tends

to factor obviously. fuel high air to will with low ton, be fuel, of that So, have it part ancillary through load and where recaptured move isn't going comes a

So done total fill. where the as have as fewer obviously we ancillary drive cuts, easily factor spend, gather that's you that seats load benefit we'll and get most easy capacity to – and with that's

point which going Another about more and is aircraft, per right this have these point. earnest. By have $X fleet, somewhere analysis, into gallon we $X.XX more in us If between kind fuel of would bit that a the maybe as still now cuts to shifted make talking we seen efficiency more our you flexibility Airbus give making Airbus. before we is changes us we worth to buffer efficient to MD-XX here a the of is were fully in have and the

Helane Becker

putting was for helpful. And thanks That Thanks question. much answering out. my very that for very

Drew Wells

you. Thank

Operator

question Thank the you. line our will And from of with come DeNardi Joseph Stifel. next

open. now is line Your

Joseph William DeNardi

you guess just this talk Scott point? can at months that the about maybe directionally to range think likely hit Drew, I Yes. end with or EPS two Thanks. which more you you're dollar left, of

D. Scott Sheldon

Yeah.

mid need think what had slightly lower the doing. this thought through pressure year we've So, business we the undertake point, evident. the and were the the into that execution XXXX Still honestly we to we as that the points given looking given to go maybe drive to fuel All cost it's has great. there been and probably at XXXX, be that trends is would

than operation So, continues the I'm execute really expected. to happy better with pace, the

So would yeah, say to I I the this slightly midpoint at point. mean, lower

Joseph William DeNardi

Okay.

I XXX,XXX Scott probably call, he's that got you at then can guys you've on tackle think not, a presentation John question for Punta into but the And DeAngelo Gorda. about maybe Okay. Sunseeker the if investor said for if it itineraries

Just you Marriott to talk wondering Sunseeker really up programs, second locked are how or into within homeowners, for Hyatt you you. that about could try itineraries. customers really can not and if of convert many loyalty Thank grabs, their not those

Scott DeAngelo

answer You a This that. bet. Scott. I'll is can of start. part I

and/or to as even in (XX:XX:XX) who Sunseeker with it's our too up I'd programs. ours is have we multiple up. time be happy So, speaking, offer I other pliable on is to a program, stay of flexible X by once opens these that, and already the which assume more that time at and loyalty of will or one XX% one been out that for loyalty but they say than that that a involved XXX,XXX tied currently and be some more vacation think property, the most have five like of Don't X now every up offer information would them customers share. memberships Sunseeker we'll home, a conservatively And are would that affixed grabs is XXX,XXX out whether have hotel, right rent experience currently second they

John T. Redmond

definitely and show Joe, basis, a how inbound even a XX the we've actually of is most closer to XXX,XXX itineraries. we're may And out have to inbound that address. trailing that clean Yeah, those itineraries any number even you is number just stripped Florida on

but if out. could in Florida. they tripper, like round Florida stripped a address, So, second homes a some They They may it look people we originate. have have

XXX,XXX the inbound a happening you may But believing So, in trajectory at itineraries. at XXXX, we're than it's that what's of been stronger show. data that that number when would look when numbers actually what with look given the little greater point comfortable you even maybe make Scott's bit the

Joseph William DeNardi

And Are an the one Okay. same those or... as thing interchangeable passenger? itinerary is

John T. Redmond

No.

and If you, books family wife or itinerary. members, your on significant someone the that's one other, everyone there,

an have So, you on anywhere one from can people to eight itinerary.

Joseph William DeNardi

Got it.

Thank you. Okay.

Operator

Thank question you. Deutsche from Michael next Linenberg our will line of And the with Bank. come

is line now Your open.

Michael Linenberg

here. Hey. two Good questions guess Hey. afternoon, I everyone.

sounds the – some out that February kind Are it for it go come just loan, internally in like construction point, activity? at to seeking of on did be and in detail funds generated us of this XXXX, that to you guess start But that's the is say out going numbers indicated to if a when about annual think January. you'd you we cash sometime of going door are also which to construction is you – assume of that off I I bit think John, out, costs. So, we a kick the more will coming some sort that of kind groundbreaking in or like financing give

John T. Redmond

what comments financing on always I've at – in been my we are and but with the I look will Michael, sources. think potential consistent points those and pursue saying past,

So, commentary changed performance the course financing the have the all to, ability being there's around done true, And if the all expect of going will internally, at fact look as one as it. opportunities look and forward. that given we be to Sunseeker forward. we'll a we have fund company, But that able at we going work made that's hasn't to that's to we continue and to-date we strong like, over that

Michael Linenberg

Okay.

that out what will we base XXXX. off – you XXXX of there would Thanks. around lower great. than you less growth assume capacity coming a into enough. Fair be this either capacity you, my the we'll then of accelerating Drew, just about get rough fact John kind and we growth. The feel data second but in Okay. know or be may early color the that when for that And of a Should XXXX January an year? think Any growth as saw up little since be early MD-XXs I ramp it's we question,

Drew Wells

Sure. Yeah, this is Drew.

to say that expect it's would I next – fair year we think hi. to

be to fair XXXX expect to we I lower than say think it's XXXX.

right our out for first we schedule sale out, look have quarter now. you As

be going the to end. lower on that's think I

expect So I to that. would XXXX surpass

those. So some really we work probably you really, wide goalpost there, have could with

Michael Linenberg

Very good. I appreciate Thanks. it.

Operator

come of with Oglenski Thank you. question And Barclays. the will Brandon our next line from

Your now line open. is

Unknown Speaker

This Hi. for is Brandon. actually (XX:XX:XX) Matt on

was kind just any of taking you to the quickly and the hoping the of and I of kind aircraft of training fleet, MD-XXs lingering remind expenses and kind transition? related what still receive as you final So could other is pilot or the us, out overhang related

D. Scott Sheldon

March be into Yeah. training at shells, per Scott. be Yeah, will look pilot going of that if any Hi. for of And available if aircraft metric grow the of XXX there MD-XX to rules, you you for we the adjusted be next number kind to back is sort the carrying fleet some a folks where This will $XX number could through when single back in had we you're into over it to years. the excess a as labor new couple come type $XX million million to peak. you

it's so, pretty And substantial.

as then is actual far the a cadence scheduled will events. everyone training on fleet be Everything As on same type. the trained because

Unknown Speaker

Okay.

of down next kind through timing the or that? what's that And so the so, on comes year or

D. Scott Sheldon

we obviously the so of bottom Yeah, end at year. the

we're have, next XX we think frames XX of to I in the frames. upwards XX growing think year. frames I release, And

And efficiency that of back type fleet from perspective. some single a so, to you gain start

Unknown Speaker

in Okay. aircraft more, utilizing more of Great. with the then And then that potentially? there in kind having growth that of fleet, newer a just kind little assume – get the we schedule kind peak bit of could of capability and you more more optimization be as the should point, or on shells the

Drew Wells

Yeah.

will grow the ways be One help. two there's that days. peak biggest the really growth, so can So, shell we that is

Additionally improved hours the the on with Airbus bit. little the a we day can economics the push of

peak a MD-XXs operate a earnest. Airbus I of with utilization But how bit your expect you of kind of you'll out fleet-wide we once consistent grow bit, get there, see see is in to particularly which more So, kind the the today. on days would

Unknown Speaker

Thank you. Okay. Great.

Operator

Thank you.

the of next Dan Research. come with Our from question Buckingham will line McKenzie

line now Your is open.

Dan J. McKenzie

or few Good back pushed here. if in Day to IT Investor perhaps are Thanks, afternoon. follow you track presentation, benefits revert I still XXXX those a call the deliver I Hey. but just to I that quite questions guys. changes e-commerce didn't likely late, the get prior previously join outlined on back? did to Got are you a could so the

John T. Redmond

No, that XXXX, John Redmond. I XXXX. done Day it is We initiatives – this in being was talked Dan, in these about about back in was, Investor believe had it

we're effort will So, that the the all making comments initiatives of be relating to that done revenue programming XXXX. in was

back will then. in those So, see as we benefits XXXX we communicated

Dan J. McKenzie

in it up a it. like looks step from benefits. those Got there's big fairly But XXXX

I think million $XX was targeted.

back guess is that's to sort so is, if step – up that I'm of I pushed And what wondering XXXX. gets

John T. Redmond

years We on guidance any between. the of never provided any in

we initiatives. XXXX XXXX come guidance will. on to without that we XXXX, any literally provide those you on through when if XXXX said to that, will So, of of years, you'll Having some see in some middle benefits start the showed

Dan J. McKenzie

third and relative Okay. inflected it products wondering Drew, in quarter I into what year. third is year think like next we ahead as you year? the of first the the think related I'm quarter it in looks to is And last initiatives and this, half that these just even we to do third-party look nicely differently about how guys the did fourth that – and the

Drew Wells

the Really, recently. of our up credit to party third we biggest the of have when of kind Dan. on September It the all card. it Sure, we is exceed until launched both XXXX expectations continues winner

has by that. piece of become to churn very the and spend New nicely, biggest growth far along account continues

So expect year. into to card to is that really that and a I big expand continue victory next credit

Dan J. McKenzie

percent other percent One the the end in completed the the what of What say, what if the question, currently? at the third fourth to And do versus, XXXX? expect you quarter fleet XXX-seat complete the to going I the at fleet can of in the one – was is last of be of quarter? end project. modifications one of So pace here, completed sneak Good. the is

Gregory C. Anderson

of delivered expect is as have AXXX-series so the also seats. with forward, to to going be of or delivered delivery And – XXX Dan. XXX aircraft we seats. will We Hey, come all of aircraft take of Greg. modified come those This we the course, kind new

from XX it be the would AXXX as will under then variant, XXX the about mature remaining think be we the So the the variant. will fleet, and XXX-seat the way I perspective

Dan J. McKenzie

for XX? And that's period, that sorry, what

Gregory C. Anderson

the XXXX. Yeah, I think end that's of through XXXX.

Dan J. McKenzie

majority Okay. point? you've able you're guess, of revenue that And fleet or to presumably revenue those safe – are the to since that guess, the are modification, that optimize manage got say this in you, seats I at I

Drew Wells

Drew as the work and is think the the fleet closely This very of We team what we the with again. Yeah. kind about to layout view optimal be. we

we'll best XXX So continue we suggests review, for so the everything but at is look revenue to team. the far that

Dan J. McKenzie

Thanks Okay. for the time you guys.

Operator

Thank you. And the of our O'Hara next from question will Steve come Sidoti. line with

now Your line is open.

Stephen O’Hara

Can come on just – within going had I thought Good and afternoon. you lease remind that picked of. the third Can can would to was I line, me I me other in you would Hi. you eventually there? that just tell delivery it due some that just you have quarter. you'll up thought the down, take aircraft have revenue guess what's on

Drew Wells

Yes.

to really timing from exceeded So, some we nicely. of expectations of point, beginning with program did planes. which drivers going that filled more the rev old Teesnap really year. our that of in other that And think But Teesnap was really to come down biggest I is the our the on gap the your on the one think

John T. Redmond

Kingsway And year beginning tick course. there August had in golf would with been we other have the of the up again this

other. that of part are Teesnap and Kingsway both So

Stephen O’Hara

so November, gallon or Okay. revert $XX burn of And should I guess. then I MD-XXs to should the I fuel end the for just of next kind mean, year? $XX out next per the year. mean – maybe on at with

Drew Wells

Yes. It's that definitely trending way.

at split. the I shells if we're think next look year taking you it's

six it's Yes. seven and rest the AXXXs. think I or AXXXs

obviously target to So continues $XX. the be

Stephen O’Hara

All Thank Okay. right. you.

Operator

with will by DeNardi Thank you. come question Joseph And our next Stifel.

open. is line Your now

Joseph William DeNardi

outlook Scott, couple labor of until is is fleet XXXX? CASM How in follow-up. completing the over for on do you baseline from really transition taking Yeah. that? of Thanks years, we next CASM or kind ex that just about think not the the efficiencies ex that XXXX get should the for the down come the

D. Scott Sheldon

Yeah.

side. impact labor is biggest the can ex-fuel definitely on the we So, have

continued the you'll movement think lion's to in year right see share next I direction into the start with XXXX.

M&E to None like maintenance to a quarter. continue in, little see – continues nice in third in of expense noise should We the item really that we continue come to line nature. there's although the be recurring trends,

So, we where pressure, the to be the thing this is, was we and there that good identified thought there. – things going they're manageable. But is areas the quite

some we movement But bring of can the but you'll movement is on that into and do left, efficiency we're we and term we XXXX fuel. pull flight see have biggest if then targets. going the to share long being where shells to into biggest additional of the But crews maybe efficiency ex So, that can XXXX. see movement lion's the

Joseph William DeNardi

the Should in expectation or CASM be that ex those expectations? should temper XXXX we is down

D. Scott Sheldon

No.

the if you core related CASM moves for you think ex started expenses, I – since non-airline very should we've adjusted see nice shell in the business.

core business execute. And so, that's the continues the whole is underlying to point, right,

right areas little there the where see that's in and focus is. might areas be to positive a in trends the problematic, the continue really where We

liking no, So, we're what we see.

Joseph William DeNardi

property? management the I'm with now go and actually that John, your use airline bit And experience run is it develop guess of a to surprised you can't get if contracts. you a approach properties you business the I without What think to that those you saying I Okay. to strategy them little these then without property, use build effectively, are smaller building then, to a have and that management own? the some hotel properties experience some

John T. Redmond

new type conversations looking haven't I without had with. getting had surrounding when at I development that periphery say started some I've to-date, so folks that. And opportunities into conversations fringe directly we to directly There's one. just involved a to-date some conversation some, nitty-gritty Look, that's in the have yet, conversation that are

But look part software of everything opportunity. cetera, an that's what branding, want offer several something et cetera. is management be from to solutions. could that at So managing properties, think you We've mentioned these we to I to et when

things the efforts until the the lot with that a roll us lot So we're part package for entirety resort. done package out and be a that ready of around to that be of would of there's IT of won't

that a governor are that, booking properties of the on include how there we channel. So we booking of relationships the around we we cases with that work did don't And there channel. we in move is that mix we if know do ones we we're the work and right hotel marketing other said Florida in was are all done some a to even want change the that little out We've there. opportunity. we can product those bit stronger markets that that what because that have in puts channel. booking done Having can our have in need as strengthen, in to we properties significant intending We've of quickly on

we're starting remain then the to conversations to with well that remaining make regard financial adjustments with the So strengthen those having opportunities that as in and properties. properties

out We think will it going So, think property. of contracts, point have we along easier way. opportunity baby real management that's we to doubt. of if think steps to a it's happen. the make for the there going. I hope us some you the to And coming There's things would to to I couple start and But to to no you after still those is then there I the will, actually that we easier that point can it's vertical. be – something project before is could that's be ground, why project, a open go I nail a point always

to old I the this, course, X any those that takeaway those them properties would I was hard contracts one on contracts, product years only years you is The are typically The at how of had lot to the given have have shorter may length or it's you would in properties. is of XX other think those thing what are, would of a that place they old. tails find have if that visibility to than

our crossed will quicker, keep chasing So, opportunities fingers happen that down. but them we be

So, I'm lot give in the I quarters, more couple hoping that over can regard. of visibility you a next

Joseph William DeNardi

Thank you.

John T. Redmond

welcome. You're

Operator

Raymond next Savi with our come And from question the you. line James. Thank Syth of will

is line Your now open.

Savanthi N. Syth

a quick Hey, I had just follow-up.

– sorry, understand. fleet the I'm didn't quite On I

expect your what XXXX? at had you Are expect this you what you've – you what know a to few of roughly from end aircrafts like So still or aircraft expect should the thinking next do year, I we year there? to XXX do slip fleet

Gregory C. Anderson

we put we mean, talked earnings I last about we've the mean Yeah, in seen I call. that's as out there delays probably. what some

I for when give be and XXXX, – think there Savi. puts our on takes I that XXXX, mean, But in expecting guidance bit. may by still number, some we little that we're a

Savanthi N. Syth

you. Thank Okay.

Operator

Thank Buckingham Research. you. with And our of line McKenzie next from question comes Dan the

is line line now open, now your Your please proceed. open. is Dan,

Dan J. McKenzie

The wondering are for thanks and incredibly talk you're here, you level the operator, if the Drew, here. what demand volatile. high I'm guys. time from Thanks, seeing backdrop stocks just could extra

business, bookings I think there's tracking about market rates, least the noticed of not talk a is at seeing you a in thing that now? on wondering lot just one interest impact lot you from if high could about of stock where volatility what I'm there's you, been demand. that volatile the the I've worries But abnormally here. has what doesn't right sit But would worry you're underlying you level, what worry

Drew Wells

Yeah.

last volatility now We've spot-on. it lot the hit demand. in months you seen a – of least a So, I I in last of couple for of strength of ton terms seen forward bookings. the terms of at think haven't

with where a I so now, industry, think Even right lot January. about periods. late in growth And in the of spur – of concern have think don't drop still the we're lot fuel off-peak I heavy issues through today, capacity more during too those think periods, fuel a industry-wide you'll I were If and even to I it particularly capacity is. really don't see

hear anticipate April so, the get that call we And we'll timeframe. about I into as

Dan J. McKenzie

got are you're you this the you of can there somewhat past evolved a in And sort pricing at about are volume know perspective, price and lot like of just inventory, has back you that's umbrella – of if benefiting the feel them, that that year, guess, compete for talk observed the thing, directly pardon I you airlines the from of diminished. I'm the don't because with me, but I legacy how year what guys. wondering seen that under. wondering seeing some if is Drew, sort you I'm you're relative from can half just the of whether while cost that over I've that same is seats I've levels then, there's pricing one you, thing And airlines ultra-low you've legacy And carrier out

Drew Wells

Yeah.

talked little I'll So caveat what overlap. is there as this you about very that and

really perspective to we the weren't seats a base not that from So at going economy were of the lot see same affected that there when We're a priced windfall rate. from of ton either.

that's On going worthy or competition, something head-to-head the might few see of select in calling my on routes to the out anything opinion. noticeable margin be have not nothing where it's that might we but you

Dan J. McKenzie

extra Thanks the good. Very time. for

Drew Wells

you. Thank

Operator

concludes Ladies and our for question-and-answer Thank today. you. session this gentlemen,

hand remarks. back So my Mr. Gallagher conference pleasure or comments now, to it closing Maury the to for over is

Maurice J. Gallagher, Jr.

Thank Thank you, in. you. days. Appreciate you're you see all, very We'll in listening XX much.

Operator

our This your may gentlemen, day. wonderful you program for on Everybody, a disconnect. we and participation and conclude Ladies conference. all today's does have thank

Allegiant Travel (ALGT) 24 Oct 182018 Q3 Earnings call transcript