[ACCESSWIRE]
LONDON, UK / ACCESSWIRE / August 11, 2016 / Active Wall St. announces its post-earnings coverage on Virgin America Inc. (NASDAQ: VA). The company announced its second quarter fiscal 2016 earnings on August 5, 2016. The west coast airline reported a 9% decline in passenger revenue per available seat mile, which impacted the bottom line despite the company saving on lower fuel expenses. Register with us now for your free membership at:
http://www.activewallst.com/register/.
Today, AWS is promoting its earnings coverage on VA; touching on Alaska Air Group Inc. (NYSE: ALK). Get our free coverage by signing up to:
http://www.activewallst.com/registration-3/?symbol=VA
http://www.activewallst.com/registration-3/?symbol=ALK
Earnings Reviewed
Virgin America posted profit of $38.1 million, or $0.85 per share, for the quarter ended on June 30, 2016, down from $65 million, or $1.47 per share, in the year ago period. On an adjusted basis, the company reported earnings of $0.93 per share, which declined 36.3% on a y-o-y basis, missing analysts' consensus estimate of adjusted earnings of $1.17 per share.
The earnings number might not be painting the right picture as the company's results were impacted by the taxes paid by the company during the quarter. In Q2 FY16, the company paid $25.95 million in taxes as compared to $364 thousand paid towards tax expenses in the year ago period. On a pre-tax basis and adjusting for one-time merger related cost of $4.4 million, the company's profit was up slightly as compared to the year ago period. Quarterly revenues of $426 million climbed 6.2% on y-o-y basis, though it also missed analysts' expectation of revenue of $447 million.
Operational Details
During Q2 FY16, airline traffic measured in revenue passenger miles rose 16.2% on a y-o-y basis to $3.16 billion. Capacity or available seat miles increased 15.3% to 3,689 million in the reported quarter. While company's load factor (percentage of seats filled by passengers) came in at 85.8%, an increase of 70 basis points as compared to the year ago period.
For Q2 FY16, Virgin America's operating income improved 2.2% to $69.2 million from the year earlier quarter. For the reported quarter, the airline paid an average of $1.51 per gallon of fuel, down 30% as compared to the average of $ $2.18 per gallon of fuel in the year-ago quarter. Meanwhile, consolidated unit cost, or cost per available seat mile, (excluding fuel and profit sharing) increased 2.8% on y-o-y basis.
Best out of the West Update
In April, 2016, Alaska Air Group, Inc., the parent company of Alaska Airlines, announced that it will acquire Virgin America for $57.00 per share in cash, or approximately $4.0 billion in aggregate transaction value. The transaction is expected to be completed by the December 2016, subject to customary closing conditions. In July 2016, Virgin America received approval for the merger from its shareholders. In the short term, Virgin America is expected to continue to operate separately from Alaska Airlines. In the long run, the merger is expected to unlock significant revenue synergies that will boost the profitability of Virgin America's present-day route network. Alaska's management has estimated the long-term revenue synergies at $175 million annually.
Stock Performance
Virgin America's stock saw a slight change downwards of 0.02% at the closing of yesterday's trading session, finishing at $55.92 on a total volume of 366,988 shares changing hands. The company's share price has surged 55.29% since the beginning of the year.
Active Wall Street:
Active Wall Street (AWS) produces regular sponsored and non-sponsored reports, articles, stock market blogs, and popular investment newsletters covering equities listed on NYSE and NASDAQ and micro-cap stocks. AWS has two distinct and independent departments. One department produces non-sponsored analyst certified content generally in the form of press releases, articles and reports covering equities listed on NYSE and NASDAQ and the other produces sponsored content (in most cases not reviewed by a registered analyst), which typically consists of compensated investment newsletters, articles and reports covering listed stocks and micro-caps. Such sponsored content is outside the scope of procedures detailed below.
AWS has not been compensated; directly or indirectly; for producing or publishing this document.
PRESS RELEASE PROCEDURES:
The non-sponsored content contained herein has been prepared by a writer (the "Author") and is fact checked and reviewed by a third party research service company (the "Reviewer") represented by a credentialed financial analyst, for further information on analyst credentials, please email [email protected]. Rohit Tuli, a CFA® charterholder (the "Sponsor"), provides necessary guidance in preparing the document templates. The Reviewer has reviewed and revised the content, as necessary, based on publicly available information which is believed to be reliable. Content is researched, written and reviewed on a reasonable-effort basis. The Reviewer has not performed any independent investigations or forensic audits to validate the information herein. The Reviewer has only independently reviewed the information provided by the Author according to the procedures outlined by AWS. AWS is not entitled to veto or interfere in the application of such procedures by the third-party research service company to the articles, documents or reports, as the case may be. Unless otherwise noted, any content outside of this document has no association with the Author or the Reviewer in any way.
NO WARRANTY
AWS, the Author, and the Reviewer are not responsible for any error which may be occasioned at the time of printing of this document or any error, mistake or shortcoming. No liability is accepted whatsoever for any direct, indirect or consequential loss arising from the use of this document. AWS, the Author, and the Reviewer expressly disclaim any fiduciary responsibility or liability for any consequences, financial or otherwise arising from any reliance placed on the information in this document. Additionally, AWS, the Author, and the Reviewer do not (1) guarantee the accuracy, timeliness, completeness or correct sequencing of the information, or (2) warrant any results from use of the information. The included information is subject to change without notice.
NOT AN OFFERING
This document is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only. Please read all associated disclosures and disclaimers in full before investing. Neither AWS nor any party affiliated with us is a registered investment adviser or broker-dealer with any agency or in any jurisdiction whatsoever. To download our report(s), read our disclosures, or for more information, visit http://www.activewallst.com/disclaimer/.
CONTACT
For any questions, inquiries, or comments reach out to us directly. If you're a company we are covering and wish to no longer feature on our coverage list contact us via email and/or phone between 09:30 EDT to 16:00 EDT from Monday to Friday at:
Email: [email protected]
Phone number: 1-858-257-3144
Office Address: 3rd floor, 207 Regent Street, London, W1B 3HH, United Kingdom
CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.
SOURCE: Active Wall Street
