SNCY - Earnings call transcript Q1 2022 | Sun Country Airlines Holdings, Inc.

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Operator

Welcome to the Sun Country Airlines First Quarter 2022 Earnings Call. My name is Terry, and I will be your operator for today’s call. [Operator Instructions] Please be advised that this conference call is being recorded. [Operator Instructions] I will now turn the call over to Chris Allen, Director of Investor Relations. Mr. begin. may you Allen,

Chris Allen

joined Davis, Jude Officer; President others questions. group I’m Executive and our Officer; of answer help Dave and to today you. Bricker, by Chief talented Thank Chief Financial

like we may company statements to Before certain I’d remind that call, make statements. during forward-looking constitute everyone that the this begin,

We and review forward-looking Actual subject forward-looking are to filings. statement. risk and uncertainties. Our to include are obligation cautionary in on and statements, remarks statements today update to management’s assume We and our assumptions based may encourage differ factors and earnings materially. results any no which SEC the our may current you beliefs, expectations outlined recent most risks release

portion I of that website And find with now to call ir.suncountry.com. would our can first press our release Relations You at said, to earnings Jude. over quarter turn like the on Investor the

Jude Bricker

morning, Good pre-pandemic pandemic, Chris. the COVID years X the first Thanks, returned of the air After onset everyone. in quarter for since demand nearly travel levels. to

While the the a base. the industry, have believe truly have and We years industry in last and people of Country X time basis, its customer shown challenging it’s cargo unique. for our and daily long growing of what makes I’m serving employees, Sun we and us on been the proud them best resiliency our and a leisure, charter

some at certain a here faces few want highlight to to I broader now challenge, industry the While Country differences versus industry. a minutes Sun the take

of quarter. been profitable. we’re profitable were first through We most pandemic. already the We’ve profitable the in First,

to deliver we’re prospects, flow. Although growth consistent on our we’re cash tremendously growth about reliant excited profitability and not

Major businesses demand environments. produced segments cash League and fuel Soccer, predictable our Amazon, pass as the and premier long-term through flow cost These in under and and we all consumer. Second, primarily such with to contracts results Caesars partners charter strong fuel are cargo

as more have deliver they of the service to our between cargo, operations and consistency cargo, Third, adjust are scheduled and been flexibility of in importantly, charter Because our never service the and charter apparent scheduled segments the synergies circumstances. have today. all we to

the where compensate So fuel to periods much And service be the quarter, environment, achieved fares peak focus able in peak we’ve for able be growth XQ in can the growth because deliver our to our fuel scheduled on to focus, to in industry. expect been that us of we stronger unit revenue costs. to versus second response

own demand, a a is improved While much it’s in pandemic. unit design. Fourth, resurgence we through deleveraged the result of great, doing industry our our as seeing and will be revenue the

deploy as aircraft produced future our In deliver we the grew block to and we CapEx purchase and X growth flow can adding while by continue that cash to debt over have year, months. will purchased Through aircraft positive quarter asset. Our many that amortizes time XX% the without growth rates same already enter attractive deleveraging to expect pandemic for opportunity prices. next the strong XXXX. hours in XX% over CapEx the be opportunities next for to the been X the and interest at have adjusted financed Today, us prices, aircraft The versus liquidity first to this future position. we our producing quarter, fleet

of support to the we’ve that, in Dave. over to and in group an to and ratified it December. quantity open having in environment. future. of excited achieved date Country I’ll this talented as pilot needed aviators our our attract Finally, growth, it With but proud Again, cost gives to us I’m in about all contract Sun so compared what team here contract as members our quality and know, has to turn our you we the all with more us This also a certainty allowed

Dave Davis

Jude. at was another XX% quarter of EBITDA margins. QX quarter sixth greater than Country, Thanks, our including Sun consecutive profitable

throughout Omicron fuel pleased high results the quarter given and We’re driven these to demand with very prices President’s softness Day. prior

XX%, again highly business the quickly in capacity between can allocation We numbers the factors and Country’s today. our Sun like that adjusted higher segments of fuel resilient of the of believe revenue much record which to quarter $X.XX our Country. adjust be industry were leading. to margin pretax unique Adjusted Sun and a QX experiencing model. Our demonstrate share flying was we’re and earnings benefits exogenous adjusted million, costs reaction for for million, and $XX.X the $XXX.X EPS operating a was we

XX% a tale up of in hours versus our some Bookings The Day, were X were halves. X.X% QX up Our President’s January, of the QX since ‘XX. total seen but in of history. demand and ASMs strongest we were was block have quarter soft

the company. average our Included of ‘XX. $XX, fare this was highest history total the $XXX of comparable QX QX Our in than ancillary higher the was number in X% revenue of per in of in passenger which is

quarterly was scheduled In scheduled service down to in first of ASMs compared a quarter increase ‘XX. on terms XX% of X% the TRASM unit when revenue, service

ad Flying prioritize revenue over to under operating will service higher in However, during for flying XXXX in up as the contract. block new XX.X% hours we longer-term under and we the revenue while Caesars ramping and X%. consecutive scheduled ‘XX hour in MLS service QX up versus the block quarter. Charter million. XX% flying hoc total March with than QX hiring per quarter be under service X% TRASM were was charter up for in made third increased quarter our to cargo QX up flying our did of during was ramp was chose agreements done the fully capacity down versus pilot was scheduled and Charter scheduled due QX. reduced we was XXXX, the and where of contracts quarter $XX.X while charter

in down due participate our as capacity steadily We’ll staffing we’re of for flying this the optionality largest illustrating to year the the unique return that year our the For first we constraints. of improves, X-pronged tournament, future when affords million NCAA the we this one picture Recall, begin due typically to checks. but revenue heavy to $XX.X last did to May example, slightly was until compared XXXX. of of cargo the Cargo carriers of the again, model charter planned type not timing us. of in basketball didn’t quarter flying maintenance quarter

being On of solid our pilot our only front, first first maintain was under adjusted quarter. quarter continue the agreement, CASM operating Despite the of cost to discipline new ‘XX. than we the cost of QX full in $X.XXXX higher X.X% QX

quarter, X.X% of ‘XX total our significantly hour QX pilot despite than block items, per average special plan XX%. flying per was per quarter gallon higher cost the and agreement. margin quarter, fuel of in month $X was of was produced our higher QX ‘XX. gallon, $X.XX the and costs fuel for we almost than operating were in March, it Excluding cost which quarter $X.XX heaviest during was initial which paid yet of new the the greater gallon our per first an than In the fuel We of first below an of still

trends. shaping be we’re second robust seasonally the with strong a revenue pleased is quarter weaker how enter Demand to up. with quarter, continues we historically As

to service expect higher same remarkable XXXX quarter to These total growth XX% XX% versus the XX% over revenue of up period. and to TRASM imply second XX% of hours. growth We XX% a to scheduled the block XX% be trends

in margin to in spite the price headwinds We for of $X.XX expect and X% cost to quarter, operating forecasting unit the fuel plus QX. per even range gallon some be X% a in of facing

in profitability high-fuel to maximize a to capacity We’re rightsizing our challenges. staffing while responding environment,

and pilots, to of all see prospective our are continue We strong numbers new hire we classes. from new application filling

As us our we quarters. to the new of grow and agreement, allowing implement training increase hire size classes, faster in expanding plan we’re new our capacity our to future

balance completed for $XXX in our the very interest We strong. $XXX million Finally, X%. average closed an financing quarter rate remains a of with over and EETC sheet liquidity just million with aircraft

We CapEx. save positive during had $XX year per over cash million aircraft the approximately quarter, million refinancing free ownership excluding expect of We to the us flow costs. in $X

the the year. aircraft Of free We expect year, we X generate plan flow we already to acquire to X. strong cash this on have closed for

capital up I’ll expenditures that, no for remainder the With XXXX it expected. non-aircraft questions. are Additionally, open to significant of

Operator

first the from of line Shanker Ravi Morgan [Operator Stanley. from Instructions] comes question Your

Ravi Shanker

your in their capacity you the Does on this on time we et customer how side, question cargo excess schedule and aircraft guys are, actually first flying in time. the of with network the obviously, from cargo recently primary for that full heard First fulfillment some they’re they have impact cetera? have kind long the a any may

Jude Bricker

A volume. a same continue is commentary that foreseeable with fly we the now stood keep XX to long-term future, aircraft. amount fully the contract to annually mind, schedules No, we up it’s did see when cargo on we fixed. as that’s the escalation in And have for same the airplanes the though we little

associated is January. biggest as then effect went it pilots. into pilot in the contract our of with costs fuel One passed as And through

that the as pilot juniorization So pilots. as escalation and we will of increases outpaces tighter now are more year the they and widen margins than last were the business rate hire

that look expect we future. we So margins those forward as into the to widen

Ravi Shanker

the time of like What year of is is going what into effect the that? escalator timing the

Jude Bricker

The calendar year.

Ravi Shanker

of time you if flexibility makes a I’m that it. pretty contracts, have mean I year, fly you guys sense. and because the much about didn’t and availability, have flexibility they the on in kind fly contracts question contracts you you guys are because want just is said charter things And this the that think one them didn’t sticky. got how But that to? follow-up I long-term good the this you charter planes your Calendar side. not of wondering okay, to do just NCAA of they’re

Dave Davis

it’s Ravi, Hello, Dave.

of is the fly will. we’re segment. if component That’s and on way NCAA don’t that. available. any have we is it, a have need want to it sort instance, for pole because our this on to resources, ad on And a basically which this fixed we the ad we near-term pick of more last contract, we say, bit Remember, about let’s the and continue of pilot we stuff the component, don’t resides. Yes, The little in of as And under segment. whatever hoc a charter fly to I bid totem constraining where up basketball, fell we’ll use basis. at pilots, think resources composed the That our then hoc all it thing That’s a prioritizing the our is we flexibility think we I’ll hours the business way. call time.

Those at we situation in that’s of ad fixed environment the horizon, XX margin of So staffing planning anything And and or then the track for cost prices, it, the we which the comes production most service, the in have rest we the yield are our adjust at cargo. fuel airplanes businesses. opportunity scheduled time, can sched of in really. hoc, for adjust from end very for the

Operator

line comes Evercore. of from Your next question the Pfennigwerth from Duane

Duane Pfennigwerth

Duane nice to guys. speak to you here,

hours, on balance XQ can the wonder of but Just historically composition you give put composition if on block is guess I for on the could of point a Understand service, the any quarter a any bigger you And there? sort high-level color thoughts on finer the scheduled you within year? sequentially. the about

Jude Bricker

just happen Duane. of to numbers me, in couple actually front have I those of a

XX% XX% So was and of first scheduled total Charter our were the was XX%. hours service quarter. in block cargo

year, I a service scheduled big particularly perspective. is move QX from into remember, quarter, the our we As mean,

a the March. be charter didn’t really there. as reallocate I we will move MLS from contracts, the the resources service particularly away into Also shift until So in get started into as Caesars and business modest there scheduled we Caesars our year, business think QX,

a gave in flying ramping basis. bigger or that’s X% piece up The as of quarter business, you So a will is or well. the our quarterly minus now, number on I cargo plus be and really the second X% that

Duane Pfennigwerth

looking it’s natural that fuel And lot of lot And for. certainly such and you’d a in than protect we obviously, what like what it’s a that the that, on your service, face environment has then played pull just out the stronger were stronger, on been did margins. scheduled back revenue

you’d what’s talk the about that for was margins? actually much how schedules, So And out have possible, of that’s a just that what’s being proactively an than maybe in cut can if in the it or taking driving overly versus it service aggressive of growth? idea sched of down maybe that your it’s in sort protecting world, we Is been see more ideal there constraint was constraint? in you growth of this

Jude Bricker

first, I strong mean, of a Well, we’re opportunities mind keep still in so include that weak distribution that flights. having and

flights. always will higher we cut these now and So the response to prices be is fuel weaker that

demand broad-based seeing improvements. we’re Now

we So we are of fuel we’re that at looked to most the those week even across have opportunities overly better fuel prices. allocate We -- also, in haul. peak set. can we’re really always but is on better, peak response periods did long cuts certainly high and prices are and crews, how so, where thinking opportunity we can about mind tied Keep the expense the

if of cuts fuel So that’s the look you at of prices. made, we some because

out get We’re flights business. those of just trying to sched the service

-- always to fuel exact continually hurdle modifying but So and you every can’t inputs rate just an the prices we give I based environment to include trying think and given the answer, a hit in yield schedule period. we’re the on

Duane Pfennigwerth

taking for this third be and revenue over taking the And look at And out is? appreciate the if based maybe sense. baked. how the what’s sort the the what at schedule to I we on makes as questions? point looked would that quarter, quarter, of That third you we we planned on is in strong

Jude Bricker

mean -- we third curve, is backwardation. our is appropriate today’s I think, Yes plan, quarter forward which in at

So some cut if bit go than then a have add. we we probably is to a to through Minneapolis little falls way opportunities don’t have There fuel in And fuel Day. seasonality get in expect, prices, if faster more. to we’ll decline we’ll the all Labor tends probably

operation words, probably really -- where In all big strong. is with it from right. we’re a And about Texas are and see improving I really, don’t to And we have so think Mexico. But of other we today. I also, travel that

Operator

line Oglenski from Brandon the from of Barclays. comes question next Your

Brandon Oglenski

guess maybe look Does ASMs sound be right are I down at schedules now, about right? that explicit, more we if XQ X%. to about

Jude Bricker

Yes, right. about that’s

Brandon Oglenski

staffing you hire think well? or new talk to I as Can And full new Okay, mentioned classes the Jude, mentioned constraints attrition side. I some helped think on well that’s on you the you contract and as pilot though, you not? are if

Jude Bricker

remain new our full Yes, hire pilots. for classes

the hiring The X We’re we’re now we’re continues have the production timeline for so X, we’re have we unprecedented hiring go around training XX about was went and lumpy include and so growing in a long the winter bottlenecks month today. basis, and and began been those. starting X And company’s month training X, which on time rates. sort our we in -- on a that for traditionally or a of company a of approval from hit more of to need across to airmen, we process getting to SIMs we more to -- from to FA which check more the

that’s but bottlenecks, and just at -- these eliminating we’re we’re in So we’re growing this to do difficult environment. XX%,

Dave Davis

Yes, hello, the other -- Dave. thing Brandon, it’s

quarter. the hours The that ago business our capacity metric, production other look can more to now we’ve of metric, on When have big out cargo is us got or XXXX. that this one we’re a years, total second for total XX% relevant sort you in That’s want look metric terms to at in X didn’t we you ASM years X up whatever. I is thing relative of block because point but

come hasn’t did the expect moderated -- wouldn’t continues has given robust. sort this I what in Jude I all timeframe legacy October and the out come very it sort the of was the call, to said the trend. I at down. of of we experienced what attrition -- mean, on be front. doing levels down September, last We the which we’re the So been the has year. pilot deal. on this think to carriers. of It pointed before, last Attrition growth hiring like of we October high it is to

very applications hire size new have the good hire done of increased So what we’ve And continue we’re and we our our new is filling the strong, news classes. classes. is

the end growth it’s So going sort to of anymore. even That on classes funnel diligently size, is the aperture expanding a solved. not of looks get of we that now continue the funnel so and we’re working can up that forward. front be our larger What the

on We’re good progress that. making

Brandon Oglenski

efficiency Got new you had expected that you expected? it. one you offsets like you lot were I that coming XX% one think contracts, the me, Is you, said through as up rates for Dave. but a of with And with last

Dave Davis

that’s going to come Here’s where through.

of seen lot haven’t we it So a yet.

cost in future. So the reductions we expect some

ones biggest the is of One PBS.

So the slated didn’t have, That not almost airlines other until bidding, most next we first have. quarter preferential which really year. to online which is -- come of

be, So of stuff, some that step bearing will other some to in of seeing that some change PBS we’re commuter the is big us. stuff that but we be think, change pretty that a efficiency. fruit, the going benefit big to There’s is the

Operator

from Your O’Brien next Goldman comes Catherine line the Sachs. of question from

Catherine O’Brien

stick to on cost I’m going this So question.

saw XX% sure contract, next down and across ‘XX. doesn’t per Could what like color efficiencies drive fixed more drive do year, the said are just basis a hours I’m new helped block ex-fuel but have come costs. on you helping the still So on us cost the productivity But one biggest you increase until that offset you you block in hour you of just result? X% [indiscernible] some give from pilot

Jude Bricker

mean, I One CASM of in reflected work, bigger, block We’ve just we’ve we’re so also costs done overhead is things. over of XX% significantly in here spreading one front number. and about a years over our hours, of talked there’s as Yes. years. lot cost few few which the fleet several on is times our last is the last clearly, a ownership we’re driven excess the items, our a over costs, number biggest of which down more

of initiatives taken So we’ve a of sort our in through fruit. that’s that work. We’ve bearing down number distribution had costs

sort So over it’s the map. of all really

expensive green older buying fleet We’re benefit time our which on reducing got active as working now strategy. engines an We’ve another our to opposed is program hard overhauls, costs. of maintenance

like that. its So items

Catherine O’Brien

you next to -- the we XX% over so aircraft just there you’re locked just got about plus think think And year, like I the as said you’ve keep growing be is may in. going with

I to lumpy that on horizon, So But couple overhead it’s spread? to see should cost ‘XX, things obviously, see like then just that of a -- to versus got obviously So little quarter-to-quarter? the and general, versus a the continue even in drive we build ‘XX? efficiency should we’ve we PBS know other that just continue lower, more

Dave Davis

continue add in as out mean, that I those you of exact absolutely hours. to And can’t spread grow quarters costs to give and over block more Yes. all but our there. we numbers ahead, continue the concepts are I still the flying, we’ll particularly,

Jude Bricker

Yes.

input and the that affects that think to we less and I we fuel fuel mean CASM is flying revert. is that don’t fast out doesn’t know how will ex-fuel grow cut if

Dave Davis

talked fly that’s we we’re can’t big when in money. don’t the wildcard is make -- We targeted very economically. we it fly. as We about Yes, how before, do where we

So be tempered well growth part is fuel going is it to by staffing of both our costs. as as

Catherine O’Brien

-- related just last maybe then the of going the a one And string. same one kind on it’s quick plan on on

the And we is said, are forward. new this relatively than to As think could margins the the a business. and while contracts. hour higher just anyone’s these out takes charter that little to would we’re we But business, they cargo so where the you time, levels, see back if you fuel but is at rate per as going higher, run best as then about XXXX Do significantly the year. pilot block changes are you stay stable surpass block we half I next year, think hours guess costs lower, the of today, some of your to all obviously took gents? year, maybe get in demand And where fuel revenue charter improves I think margins improve adding bit of in understand your XXXX. profitability, would

Jude Bricker

margins answer. when to will I our as circumstances, right it’s get is right I there is the with else, all in the lead think think Yes, way as we’ll good everybody the be And other can them. industry. it mean about for

Operator

the line Research. Scott Group of Your Wolfe next question from from comes

Scott Group

longer going, ancillary term? see of $XX year You that you here or of do do where Where about the from going that per talked revenue passenger. see you rest

Jude Bricker

new product going which charge, displace to is called want fare the because we pretty interface I here be careful passenger launched So, just substantially. a to

effective. pricing the we relevant bags we efficiency, based total are $X is rolling is and bundles, third-party on -- So have to that’s most of and of assignments. to revenue be upside which in going acceleration just that in of $X what ancillary And passenger products effectiveness really that revenue pretty But in to see are be and products, think to airfare. there increased per just you’re accretive displacement rapid financials, our going ones seat because of we’re PIF the a ancillary of our per you, out passenger to going warn are that to about our

going So finish over we’re probably to XX.

Scott Group

a shift is one from saying lot other? the you’re to a But of that just

Jude Bricker

ULCCs and Yes have that all that’s product is. one all it like doing a we’re the

stack you So ancillary the people therefore comparisons the passenger, have a one. bag expect a sales matters kind of you just products, when may bring think careful buy the to the don’t priced the irrelevant stuff and airfare, that to so [indiscernible] Onboard accretive particularly have to to about interpret per stuff you total is less, it’s if And for airfare. that little seats, to industry seat completely across bag into of be that is the revenue. -- you is as ancillary revenue

are Third-party anyway, product going totally those you’re buy accretive. sales to

customer spectrum all incremental a fee charge, The remember one a and CIC, basically there’s but that So convenience calls Spirit have money it, associated from fee, Allegiant can’t at PIF, customer Frontier. just I interface value the it’s categories. a moves product think, I with fare. a calls they of it’s what it

Dave Davis

As the is total out, Jude of pointed accretive object to here revenue. obviously sort

in in upside started we getting rental products, management doing involved third-party the seat in of of pricing, heavily business. $X to truly accretive more $X Yield of sort stuff. car about talked we So which

the that’s sort well. road down of coming as So

Scott Group

cargo Amazon know on the follow-up I from the earlier. question

of your -- the So some I maybe get mind? when you aircraft get additional no your does capacity excess change Amazon change timing Do think in today. in network in could the having you business

Jude Bricker

believe there doing in with to service about well. And really them that scheduled mean, I continue right remain growth I is some. We are now, opportunities. discussion

I We’re strong not business, our today. It’s right which service, mean in to peak period push cargo best need thing try frankly. our we to a big is quite continue really rush to now. to grow scheduled

Scott Group

And of are seeing uptick changes cases an then environment just cases, bit in as you lastly, the any move we’re a higher? in little little seeing demand as a

Jude Bricker

mean, push none but it’s at looks of I I a and hearing no say sold CEOs U.S. It and I we’ve inflection hill airline really average into accretive. gets where we every summer. down. the across inflection you’re mid-February higher saw variance It’s no, seen of this another No, rare. the of steady all the as point, all. it’s kind think higher airfare it, day. linear and kind this the can’t slowing point backdrop this signs we very the capacity circumstance And where in of from of know

to going there. out enough lot not pay travel of a seats there’s, because You’re

can’t soon. I around turning anytime imagine -- it’s it So

Operator

comes question of the next line from Your Bank. Instructions] Linenberg [Operator Deutsche from Mike

Mike Linenberg

one a that’s from better just a seem Dave, to here Harbor, Chicago, What’s with day Maybe the on York Mid-Con, the not benefiting you guess bit fuel, are I prices, that you’re gallon. end? did Presumably, New lower? quick be strip. dealing $X.XX per

Dave Davis

going don’t the for come to days bulk that’s narrowing, of the with fuel that’s honest the something is here -- along cracks old, assumption to are obviously, or buy crack X I bulk X probably, strip in. days, some like some we of X that. We The Yes, you, in Minneapolis. with be think know, spread

the Northeast comes So is very continues our of from. most be to but exposure minimal, that fuel our to where

Jude Bricker

Probably business the the our the is of as more fuel to fuel our of volatile environment. rest industry relevant compare within you seasonality the price

paid to other et -- look which really than -- to as same you is happened plan. June if fuel heavy more to the fuel probably compared It’s quarter. of be significantly the our where price them, higher to because a quarter, in that’s X And price in little we’re when third months higher that’s higher, of in quarter, relative -- in majority our we is second March the flying the quarter And going the fuel So reverse exists business the first cetera. the the comps.

Mike Linenberg

last said, for Hawaii, it And XXs? expensive the charter and able was and as less reserve to sort to business? for it’s but X backfill cargo airplanes, And to shifting you helpful. it’s were I pretty shift at starts on these you getting you on Coast then that’s No, haul above X quarter, that of fact to biz mean, down capacity, and XX it’s this scheduled curious, -- months hour given there you make look, Charter your obviously, mean, Minneapolis you’re guess where to did the just you’ve pulling Okay. June thing. meaningful I mix pilots the in months I longer was? pilots that it’s than quarter, you things carry Fairbanks fuel to said ago, a the like ago, now mean, right basis, get West some maybe I from of Jude, a scheduled and these not really what the with block maybe XX% X, know or X, quarter, it’s it less be that carrying scheduled. I’m looks flights and fuel definition you March the to were going -- to been shift. a bit little I at like

Jude Bricker

mean talk let always. Yes flying me I lines our first pilots. group about of pilot all supports just

then crew and cargo they trip. out fly they a and integrated all one and we have then a trips, sched and in at and go fly we might fly single and in particular then So a charter base, they may

of it’s efficiencies. lot us and very So the integrated that a gives

fixed think, in is about ability to on we March XX% about it sched draw a at expect seasonality versus and we’re would optimally, of our X/X so down what which to And XX% the gives We service September us September. typical flying March that sched.

-- then benign associated variations backdrop, or or fuel there’s or anything other and whatever. inputs So environment competitive or prices of else, aggressive yield that with the

that into if we’re where think of so XX-XX operate place -- basically same business which about anything in time, over our and I and, the sched Grant, And got track going -- versus else? but correct to kind cargo, it’s you’ve

Grant Whitney

is say really team is job a All the this forecasted best Mike, Yes. does of margins. I Grant. good based would on optimizing

customers we the as service, stepped And made and a would adjustments on side, back made and we can you that through ones in the done if we -- framework. commented -- there so then we scheduled as ad or with as relatively you in, which choose well. pick we absolutely time, have were strategic mentioned, from this these a on the absolutely, And hoc -- charter definitely you right Dave are have close

So a value. executing still you’ll high of a but this job team little drive really most of the But reduction operating bit and optimizing biggest level at our does it’s a good of to there, amount customers. -- for see

Operator

comes Susquehanna. Your from Stathoulopoulos next question from line the of Christopher

Christopher Stathoulopoulos

way. want get this just I in to demand perhaps or to different TRASM So a outlook

off So mask quarter. travel here, summer mandates the around

compare half? RMS discount, say, excuse is your factors you let’s stimulate your days to out you out, years normally the with whatever window on marketing kind time second And having the demand last If average or it how X pre-pandemic. let’s year could to load do color stimulate to further this are sufficient then, like? And so booking into of me, around XX-day then X XX-plus say, does give and to you to required or respect to to some with looks and X team what fill

Jude Bricker

it general won’t in any to Hello, and I’ll there’s couple make of it Right if Chris, Grant. throw we a now stimulation we’re comments, me it. a flight, doing over -- not pricing. prices cut, just low fly is It let a

may Omicron at is quickly how you new going environment. after the we this think kind things to are the of went getting into new kind of react environment pricing to of I be we when One

in to sold at And is so February all in And recovered we it’s XX% mid-February And end downs. we COVID the end and about about grace environment, our We change different strongly. good, of with booking yet quarter. environment. is give to second now of okay, the kind the new X/X the in the weeks quarter and priced and pricing this of us and February to be through where into third X/X the I’d by probably when of the behavior say, new of demand had real its segments would a we we’re saw and about just ups came X with really

So X, the that go XXXX, in bookings say, into it’s they lot it’s the on is because just move. algorithm. higher yields will were fares And It’s are I of X-year we’re selling up post steady. is but new are basis in just a XX%. like would on seats so of the kind March basically other the just comment more will up, environment. But be of fair, year big over a back what days And all a fares high, sold out mean, a like fares. back day. One it I of heuristic

by So activity higher creates -- fares activity booking nature.

our algorithms naturally of so just sort And adjust.

anything Grant of even And to our so realigning of add. able we’re of kind to advantage expectations. advance take in it

Grant Whitney

have these well. add the And that, team we markets management, basis, these know to especially only No. I flight-by-flight really the They are Jude the would -- these folks who thing really, on a manage yield management basis. revenue day-by-day teams,

seeing level doing making at that the being this, cognizant things. good they’re a that market of sure highest will we of really selling and other the So are fares bear, job they’re

echo is value absolutely sentiment. we put When schedules every expect thing up, would just I other Jude we drive for the to flight The airline.

a just any thought country. out some doing on we not what’s been input for schedule stimulation in stakeholders best in lot the are There’s and the have we schedules future. So of the from

Operator

next from from Pfennigwerth Duane Evercore. question the line Your of comes

Duane Pfennigwerth

good look kind we model you’ve in the at revenue. scheduled had when of historically service, So

hasn’t be sort much actively the you’ve all push as But a deciding It of capacity, should yields. loads. on right about loads with a this of bit decent had balance fares, decent of you been You’ve capacity thinking how tight are the way be given differently now little with to had just tight we year? for

Jude Bricker

of naked Grant I let that just to of when is seasonal a The there’s that I’ll good and a differences ends couple answer, question, nature flying of leg, it want and a have. seasonal right. highlight we do We but lot begins flying. It’s a

flight. the return because was Central So able planes empty be trip back America, pulled but round your on nobody down first that down, fly and to to

to I lower Southwest, our would our is So at expect than state -- example. you steady what would in probably say such for see load factors

Grant Whitney

Yes. to want But people when fly cater we do the schedule fly. to

to the or so revenue people take the So unit valid sort ancillary to doing well. team you if job We strategic of the where getting are of going that step lot the come fly, allocating through we -- from are a a still the depths when fly getting -- that good do increases the benefit as And want are we a certainly down in airplane. into of a way. doing people capacity, it’s fare. we’re very But on really is

So making system really look can level while strategic we markets be bets may at there. excited and that at absolutely we’re down, a we’re you about,

coming really feel in us. how things about we So are good for

Operator

the like right. I’m back at questions conference to this further showing Bricker. All time. no now turn Jude I’d to

Jude Bricker

and your Well, Talk quarter. everybody, with the to time you us. thanks spending for for interest, thanks next

Operator

This concludes all you for participation. Thank your call. today’s conference

may disconnect. now You

Sun Country Airlines (SNCY) 8 May 222022 Q1 Earnings call transcript