ALASKA AIR GROUP INC

For the period ended Sep 30, 2024. Filed Nov 8, 2024.

About this filing

A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.

Sep 30, 2024 · Filed Nov 8, 2024

ALK$41.54-0.4%Stored close · as of Nov 10, 2026

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Contents

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATED BALANCE SHEETS(unaudited)

(in millions)	September 30, 2024	December 31, 2023
ASSETS
Current Assets
Cash and cash equivalents	$1,015	$281
Restricted cash	27	—
Marketable securities	1,490	1,510
Total cash, restricted cash, and marketable securities	2,532	1,791
Receivables - net	510	383
Inventories and supplies - net	202	116
Prepaid expenses	270	176
Other current assets	223	239
Total Current Assets	3,737	2,705
Property and Equipment
Aircraft and other flight equipment	12,349	10,425
Other property and equipment	2,109	1,814
Deposits for future flight equipment	612	491
	15,070	12,730
Less accumulated depreciation and amortization	(4,548)	(4,342)
Total Property and Equipment - Net	10,522	8,388
Other Assets
Operating lease assets	1,346	1,195
Goodwill	2,703	1,943
Intangible assets - net	888	90
Other noncurrent assets	363	292
Total Other Assets	5,300	3,520
Total Assets	$19,559	$14,613

CONDENSED CONSOLIDATED BALANCE SHEETS(unaudited)

(in millions, except share amounts)	September 30, 2024	December 31, 2023
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable	$242	$207
Accrued wages, vacation and payroll taxes	822	584
Air traffic liability	1,878	1,136
Other accrued liabilities	958	800
Deferred revenue	1,614	1,221
Current portion of operating lease liabilities	211	158
Current portion of long-term debt and finance leases	523	353
Total Current Liabilities	6,248	4,459
Noncurrent Liabilities
Long-term debt and finance leases, net of current portion	4,159	2,182
Long-term operating lease liabilities, net of current portion	1,249	1,125
Deferred income taxes	889	695
Deferred revenue	1,578	1,382
Obligation for pension and post-retirement medical benefits	505	362
Other liabilities	452	295
Total Noncurrent Liabilities	8,832	3,859
Commitments and Contingencies (Note 7)
Shareholders' Equity
Preferred stock, $0.01 par value, Authorized: 5,000,000 shares, none issued or outstanding	—	—
Common stock, $0.01 par value, Authorized: 400,000,000 shares, Issued: 2024 - 140,588,216 shares; 2023 - 138,960,830 shares, Outstanding: 2024 - 126,125,771 shares; 2023 - 126,090,353 shares	1	1
Capital in excess of par value	769	695
Treasury stock (common), at cost: 2024 - 14,462,445 shares; 2023 - 12,870,477 shares	(882)	(819)
Accumulated other comprehensive loss	(268)	(299)
Retained earnings	4,859	4,535
Total Shareholders' Equity	4,479	4,113
Total Liabilities and Shareholders' Equity	$19,559	$14,613

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(unaudited)

	Three Months Ended September 30,		Nine Months Ended September 30,
(in millions, except per share amounts)	2024	2023	2024	2023
Operating Revenue
Passenger revenue	$2,821	$2,618	$7,476	$7,200
Loyalty program other revenue	171	159	509	483
Cargo and other revenue	80	62	216	190
Total Operating Revenue	3,072	2,839	8,201	7,873
Operating Expenses
Wages and benefits	883	782	2,469	2,259
Variable incentive pay	104	45	197	149
Aircraft fuel, including hedging gains and losses	624	694	1,804	1,932
Aircraft maintenance	140	118	391	367
Aircraft rent	49	48	142	161
Landing fees and other rentals	194	183	532	502
Contracted services	108	100	311	290
Selling expenses	82	84	243	231
Depreciation and amortization	139	113	393	330
Food and beverage service	69	62	194	176
Third-party regional carrier expense	63	58	181	164
Other	202	185	593	544
Special items - operating	74	156	254	406
Total Operating Expenses	2,731	2,628	7,704	7,511
Operating Income	341	211	497	362
Non-operating Income (Expense)
Interest income	28	23	69	62
Interest expense	(44)	(34)	(115)	(90)
Interest capitalized	7	7	19	21
Special items - net non-operating	(1)	(8)	(1)	(14)
Other - net	(3)	(6)	(3)	(22)
Total Non-operating Expense	(13)	(18)	(31)	(43)
Income Before Income Tax	328	193	466	319
Income tax expense	92	54	142	82
Net Income	$236	$139	$324	$237
Basic Earnings Per Share:	$1.87	$1.09	$2.57	$1.86
Diluted Earnings Per Share:	$1.84	$1.08	$2.52	$1.84
Weighted Average Shares Outstanding used for computation:
Basic	126.189	127.187	126.165	127.375
Diluted	128.590	129.188	128.347	129.085

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE OPERATIONS(unaudited)

	Three Months Ended September 30,		Nine Months Ended September 30,
(in millions)	2024	2023	2024	2023
Net Income	$236	$139	$324	$237
Other comprehensive income (loss), net of tax
Marketable securities	20	2	25	18
Employee benefit plans	3	3	9	11
Interest rate derivative instruments	(4)	—	(3)	(1)
Total other comprehensive income, net of tax	$19	$5	$31	$28
Total Comprehensive Income, Net of Tax	$255	$144	$355	$265

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY(unaudited)

(in millions)	Common Stock Outstanding	Common Stock	Capital in Excess of Par Value	Treasury Stock	Accumulated Other Comprehensive Loss	Retained Earnings	Total
Balance at December 31, 2023	126.090	$1	$695	$(819)	$(299)	$4,535	$4,113
Net loss	—	—	—	—	—	(132)	(132)
Other comprehensive income	—	—	—	—	5	—	5
Common stock repurchase	(0.561)	—	—	(21)	—	—	(21)
Stock-based compensation	—	—	15	—	—	—	15
Stock issued under stock plans	0.177	—	(3)	—	—	—	(3)
Balance at March 31, 2024	125.706	$1	$707	$(840)	$(294)	$4,403	$3,977
Net income	—	—	—	—	—	220	220
Other comprehensive income	—	—	—	—	7	—	7
Common stock repurchase	(0.663)	—	—	(28)	—	—	(28)
Stock-based compensation	0.013	—	13	—	—	—	13
Stock issued for employee stock purchase plan	1.401	—	37	—	—	—	37
Stock issued under stock plans	0.018	—	—	—	—	—	—
Balance at June 30, 2024	126.475	$1	$757	$(868)	$(287)	$4,623	$4,226
Net income	—	—	—	—	—	236	236
Other comprehensive income	—	—	—	—	19	—	19
Common stock repurchase	(0.368)	—	—	(14)	—	—	(14)
Stock-based compensation	—	—	12	—	—	—	12
Stock issued under stock plans	0.019	—	—	—	—	—	—
Balance at September 30, 2024	126.126	$1	$769	$(882)	$(268)	$4,859	$4,479

(in millions)	Common Stock Outstanding	Common Stock	Capital in Excess of Par Value	Treasury Stock	Accumulated Other Comprehensive Loss	Retained Earnings	Total
Balance at December 31, 2022	127.534	$1	$577	$(674)	$(388)	$4,300	$3,816
Net loss	—	—	—	—	—	(142)	(142)
Other comprehensive income	—	—	—	—	23	—	23
Common stock repurchase	(0.414)	—	—	(18)	—	—	(18)
Stock-based compensation	—	—	12	—	—	—	12
Stock issued under stock plans	0.123	—	(2)	—	—	—	(2)
Balance at March 31, 2023	127.243	$1	$587	$(692)	$(365)	$4,158	$3,689
Net income	—	—	—	—	—	240	240
Other comprehensive income	—	—	—	—	—	—	—
Common stock repurchase	(0.872)	—	—	(39)	—	—	(39)
Stock-based compensation	0.017	—	26	—	—	—	26
Stock issued for employee stock purchase plan	0.924	—	34	—	—	—	34
Stock issued under stock plans	0.036	—	1	—	—	—	1
Balance at June 30, 2023	127.348	$1	$648	$(731)	$(365)	$4,398	$3,951
Net income	—	—	—	—	—	139	139
Other comprehensive income	—	—	—	—	5	—	5
Common stock repurchase	(0.249)	—	—	(13)	—	—	(13)
Stock-based compensation	—	—	11	—	—	—	11
Stock issued under stock plans	0.021	—	—	—	—	—	—
Balance at September 30, 2023	127.120	$1	$659	$(744)	$(360)	$4,537	$4,093

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(unaudited)

	Nine Months Ended September 30,
(in millions)	2024	2023
Cash Flows from Operating Activities:
Net Income	$324	$237
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	393	330
Stock-based compensation and other	55	73
Special items - operating	4	395
Changes in certain assets and liabilities:
Changes in deferred income taxes	127	90
Increase in accounts receivable	(85)	(45)
Increase in air traffic liability	229	179
Increase in deferred revenue	52	102
Other - net	91	(258)
Net Cash Provided by Operating Activities	1,190	1,103
Cash Flows from Investing Activities:
Property and equipment additions
Aircraft and aircraft purchase deposits	(532)	(669)
Other flight equipment	(118)	(153)
Other property and equipment	(202)	(169)
Acquisition of Hawaiian, net of cash acquired	(659)	—
Supplier proceeds	162	—
Purchases of marketable securities	(428)	(519)
Sales and maturities of marketable securities	1,153	806
Other investing activities	188	(106)
Net cash used in investing activities	(436)	(810)
Cash Flows from Financing Activities:
Proceeds from issuance of long-term debt, net of issuance costs	344	313
Long-term debt payments	(279)	(242)
Common stock repurchases	(63)	(70)
Other financing activities	5	11
Net cash provided by financing activities	7	12
Net increase in cash and cash equivalents	761	305
Cash, cash equivalents, and restricted cash at beginning of period	308	369
Cash, cash equivalents, and restricted cash at end of the period	$1,069	$674
Supplemental disclosure:
Cash paid during the period for:
Interest, net of amount capitalized	$107	$85
Income taxes, net of refunds received	2	14
Non-cash transactions:
Right-of-use assets acquired through operating leases	35	120
Operating leases converted to finance leases	—	505
Property and equipment acquired through the issuance of debt	$68	$179

	Nine Months Ended September 30,
(in millions)	2024	2023
Reconciliation of cash, cash equivalents, and restricted cash:
Cash and cash equivalents	$1,015	$647
Restricted cash	27	—
Restricted cash included in Other noncurrent assets	27	27
Total cash, cash equivalents, and restricted cash at end of the period	$1,069	$674

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The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.