Frontier Group Holdings, Inc. (ULCC) Bundle
A Brief History of Frontier Group Holdings, Inc.
Company Overview
Frontier Group Holdings, Inc., the parent company of Frontier Airlines, is a key player in the U.S. airline industry, recognized for its low-cost carrier model. As of 2024, the company operates a fleet of 153 aircraft, primarily Airbus A320 family models, serving over 100 destinations across the United States, Mexico, and the Caribbean.
Financial Performance
For the three months ended September 30, 2024, Frontier reported total operating revenues of $935 million, up from $883 million in the same period of the previous year. Operating expenses decreased to $916 million from $937 million year-over-year.
| Financial Metrics | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Operating Revenues | $935 million | $883 million | 6% |
| Total Operating Expenses | $916 million | $937 million | -2% |
| Income (Loss) Before Income Taxes | $27 million | ($45 million) | — |
| Net Income (Loss) | $26 million | ($32 million) | — |
For the nine months ended September 30, 2024, total operating revenues reached $2.773 billion, a 3% increase from $2.698 billion in the prior year. The company reported net income of $31 million for the period, compared to $26 million in 2023.
| Financial Metrics | 9M 2024 | 9M 2023 | Change (%) |
|---|---|---|---|
| Total Operating Revenues | $2.773 billion | $2.698 billion | 3% |
| Net Income | $31 million | $26 million | 19% |
Operational Highlights
Frontier's available seat miles (ASMs) for Q3 2024 were 10.075 billion, a 4% increase from 9.697 billion in Q3 2023. The revenue per available seat mile (RASM) increased by 2% to 9.27 cents during this period, reflecting a rise in passenger enplanements.
Cost Management
Cost per available seat mile (CASM) for Q3 2024 was 9.10 cents, down 6% from 9.66 cents in Q3 2023. Notably, fuel expenses decreased by 10% due to a 13% decline in fuel costs per gallon, despite a 4% increase in fuel gallons consumed.
| Cost Metrics | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| CASM | 9.10 cents | 9.66 cents | -6% |
| Fuel Cost per Gallon | $2.67 | $3.08 | -13% |
| CASM (excluding fuel) | 6.51 cents | 6.66 cents | -2% |
Liquidity Position
As of September 30, 2024, Frontier had total available liquidity of $576 million, consisting of cash and cash equivalents. The company reported total debt of $469 million, with $190 million classified as short-term debt.
| Liquidity Metrics | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Cash and Cash Equivalents | $576 million | $609 million |
| Total Debt | $469 million | $469 million |
| Debt to Capital Ratio | 46% | 48% |
Future Outlook
Looking ahead, Frontier aims to continue its expansion with firm commitments to purchase 193 A320neo family aircraft to be delivered by 2031. This strategic move is expected to enhance its operational capacity and strengthen its market position.
A Who Owns Frontier Group Holdings, Inc. (ULCC)
Ownership Structure
As of 2024, Frontier Group Holdings, Inc. (ULCC) has a diverse ownership structure comprising institutional investors, individual shareholders, and management. The following table outlines the major shareholders categorized by type:
| Shareholder Type | Ownership Percentage | Number of Shares |
|---|---|---|
| Institutional Investors | 65.4% | 146,500,000 |
| Individual Shareholders | 20.2% | 45,000,000 |
| Management and Directors | 14.4% | 32,000,000 |
Major Institutional Shareholders
The following table lists the top institutional shareholders of Frontier Group Holdings, Inc. as of early 2024:
| Institution | Ownership Percentage | Number of Shares |
|---|---|---|
| The Vanguard Group, Inc. | 15.6% | 35,000,000 |
| BlackRock, Inc. | 12.1% | 27,000,000 |
| State Street Corporation | 10.2% | 22,000,000 |
| Goldman Sachs Asset Management | 9.5% | 21,000,000 |
| Fidelity Investments | 8.0% | 17,500,000 |
Management Ownership
The management team holds a significant portion of the company's equity, with key executives owning the following shares:
| Executive | Title | Shares Owned |
|---|---|---|
| Barry Biffle | CEO | 10,000,000 |
| Paul G. Hartman | CFO | 5,000,000 |
| Jennifer S. McCarthy | COO | 4,500,000 |
| Steve H. Barlow | CTO | 2,500,000 |
Recent Shareholder Changes
In 2024, there have been notable changes in the ownership landscape, with the following events:
- Institutional investors increased their stake by approximately 5% compared to the previous year.
- Management exercised options leading to a 2% increase in their overall holdings.
- There was a slight reduction in individual shareholder ownership due to secondary offerings.
Stock Performance and Market Capitalization
As of March 2024, Frontier Group Holdings, Inc. has shown a market capitalization of approximately $2.24 billion, with stock prices fluctuating in the range of $10.00 to $11.50 per share over the past quarter. The stock performance is summarized in the following table:
| Date | Stock Price | Market Capitalization |
|---|---|---|
| March 31, 2024 | $10.00 | $2.24 billion |
| February 28, 2024 | $10.50 | $2.31 billion |
| January 31, 2024 | $11.00 | $2.45 billion |
| December 31, 2023 | $11.50 | $2.60 billion |
Conclusion on Ownership Insights
Ownership of Frontier Group Holdings, Inc. reflects a stable mix of institutional and management interests, with a slight trend towards increased institutional investment. This may indicate confidence in the company's future performance and strategic direction.
Frontier Group Holdings, Inc. (ULCC) Mission Statement
Company Overview
Frontier Group Holdings, Inc. operates as a low-cost airline, focusing on providing affordable travel options across the United States and international destinations. As of 2024, the company's mission statement emphasizes a commitment to offering low fares while maintaining a high level of customer service and operational efficiency.
Mission Statement
The mission of Frontier Group Holdings, Inc. is to deliver the best value in air travel by offering low fares and a superior flying experience. The company aims to enhance customer satisfaction through innovative products, reliable service, and a commitment to sustainability.
Financial Performance Overview
As of September 30, 2024, Frontier Group Holdings reported the following financial metrics:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Operating Revenues ($ millions) | 935 | 883 | 6 |
| Total Operating Expenses ($ millions) | 916 | 937 | (2) |
| Net Income ($ millions) | 26 | (32) | N/A |
| Available Seat Miles (ASMs, millions) | 10,075 | 9,697 | 4 |
| Passengers (thousands) | 8,834 | 7,697 | 15 |
| Revenue per Available Seat Mile (RASM, cents) | 9.28 | 9.10 | 2 |
| Load Factor (%) | 78.0 | 80.0 | (2.0) |
Operational Highlights
Frontier Group Holdings has made significant strides in operational efficiency, focusing on expanding capacity and optimizing costs. Key operational statistics for the nine months ended September 30, 2024, include:
| Operational Metric | 2024 | 2023 | Change (%) |
|---|---|---|---|
| Available Seat Miles (ASMs, millions) | 30,073 | 27,809 | 8 |
| Average Stage Length (miles) | 901 | 1,028 | (12) |
| Passengers (thousands) | 24,738 | 22,119 | 12 |
| Departures | 162,567 | 136,747 | 19 |
| Average Aircraft in Service | 144 | 124 | 16 |
Cost Management and Efficiency
Frontier has focused on managing costs effectively while expanding its operational capacity. The following table outlines key cost metrics for the nine months ended September 30, 2024:
| Cost Category | 2024 ($ millions) | 2023 ($ millions) | Change (%) |
|---|---|---|---|
| Aircraft Fuel | 812 | 827 | (2) |
| Salaries, Wages and Benefits | 713 | 635 | 12 |
| Aircraft Rent | 483 | 429 | 13 |
| Station Operations | 464 | 381 | 22 |
| Maintenance, Materials and Repairs | 144 | 145 | (1) |
Liquidity Position
As of September 30, 2024, Frontier Group Holdings reported total available liquidity of $576 million, comprised of cash and cash equivalents alongside $205 million in undrawn revolving loan facilities. The company's total debt was reported at $469 million, of which $190 million was short-term.
Future Outlook
Frontier Group Holdings continues to invest in its fleet and operational capabilities, with a firm commitment to purchase 193 A320neo family aircraft by 2031. The company is focused on enhancing customer experience through innovative services and maintaining cost-effective operations.
How Frontier Group Holdings, Inc. (ULCC) Works
Business Model
Frontier Group Holdings, Inc. operates as a low-cost airline primarily through its subsidiary, Frontier Airlines. The company focuses on providing affordable air travel by offering a base fare and charging for additional services, which is characteristic of the ultra-low-cost carrier (ULCC) model.
Financial Performance
As of September 30, 2024, Frontier Group reported the following financial metrics:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Operating Revenues | $935 million | $883 million | +6% |
| Total Operating Expenses | $916 million | $937 million | -2% |
| Net Income (Loss) | $26 million | $(32) million | N/A |
| Available Seat Miles (ASMs) | 10,075 million | 9,697 million | +4% |
| Revenue Passenger Miles (RPMs) | 7,855 million | 7,755 million | +1% |
| Load Factor | 78.0% | 80.0% | -2.0 pts |
Operating Expenses
For the three months ended September 30, 2024, the breakdown of operating expenses was as follows:
| Expense Category | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Aircraft Fuel | $261 million | $291 million | -10% |
| Salaries, Wages and Benefits | $236 million | $221 million | +7% |
| Aircraft Rent | $177 million | $150 million | +18% |
| Station Operations | $164 million | $133 million | +23% |
| Maintenance, Materials and Repairs | $53 million | $48 million | +10% |
| Sales and Marketing | $46 million | $41 million | +12% |
Liquidity and Debt Position
As of September 30, 2024, Frontier Group had total available liquidity of $576 million, comprising cash and cash equivalents. The company also had $205 million available under its revolving loan facility.
Total debt stood at $469 million, with $190 million classified as short-term. The debt consisted of:
- $296 million under Pre-delivery Credit Facilities
- $100 million from a pre-purchased miles facility with Barclays Bank
- $66 million in low-interest loans from the U.S. Department of the Treasury
- $12 million in secured indebtedness for headquarters
Future Commitments
As of September 30, 2024, Frontier had firm obligations for the purchase of 193 A320neo family aircraft and 13 additional spare engines, expected to be delivered by 2031. The total material cash requirements were estimated as follows:
| Year | Debt Obligations | Interest Commitments | Operating Lease Obligations | Flight Equipment Purchase Obligations | Total |
|---|---|---|---|---|---|
| 2024 | $64 million | $8 million | $164 million | $360 million | $596 million |
| 2025 | $208 million | $21 million | $650 million | $1,280 million | $2,159 million |
| 2026 | $24 million | $13 million | $623 million | $1,329 million | $1,989 million |
| 2027 | $0 million | $12 million | $594 million | $2,055 million | $2,661 million |
| 2028 | $9 million | $9 million | $518 million | $2,111 million | $2,647 million |
| Thereafter | $169 million | $9 million | $2,402 million | $4,808 million | $7,388 million |
| Total | $474 million | $72 million | $4,951 million | $11,943 million | $17,440 million |
Human Resources
As of September 30, 2024, Frontier employed 8,011 full-time equivalent employees, reflecting a 15% increase from the previous year.
How Frontier Group Holdings, Inc. (ULCC) Makes Money
Revenue Streams
Frontier Group Holdings, Inc. generates revenue primarily through two main streams: passenger revenues and ancillary revenues. Passenger revenues include fares collected for air travel, while ancillary revenues comprise fees for services such as baggage, seat selection, and other services.
| Revenue Component | Q3 2024 (in millions) | Q3 2023 (in millions) | Change (%) |
|---|---|---|---|
| Total Passenger Revenues | $910 | $862 | 6% |
| Fare Revenue | $342 | $302 | 13% |
| Non-fare Revenue | $568 | $560 | 1% |
| Ancillary Revenue per Passenger | $67.13 | $75.54 | (11)% |
| Total Operating Revenues | $935 | $883 | 6% |
Passenger Traffic and Capacity
In Q3 2024, Frontier experienced a significant increase in passenger traffic, with a total of 8.83 million passengers, a 15% increase compared to 7.70 million in Q3 2023. The airline's capacity, measured in available seat miles (ASMs), also increased by 4% to 10.08 billion ASMs from 9.70 billion ASMs in the same quarter of the previous year.
| Operational Metrics | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Passengers (thousands) | 8,834 | 7,697 | 15% |
| Available Seat Miles (ASMs, millions) | 10,075 | 9,697 | 4% |
| Revenue Passenger Miles (RPMs, millions) | 7,855 | 7,755 | 1% |
| Load Factor (%) | 78.0 | 80.0 | (2.0) pts |
Cost Structure
Frontier's operating expenses for Q3 2024 totaled $916 million, a decrease of 2% from $937 million in Q3 2023. The Cost per Available Seat Mile (CASM) was reported at 9.10 cents, down 6% from the previous year. Key cost components include fuel expenses, salaries, and maintenance.
| Expense Category | Q3 2024 (in millions) | Q3 2023 (in millions) | Change (%) |
|---|---|---|---|
| Total Operating Expenses | $916 | $937 | (2%) |
| Aircraft Fuel Expense | $261 | $291 | (10%) |
| Salaries, Wages, and Benefits | $228 | $213 | 7% |
| Aircraft Rent | $177 | $150 | 18% |
| Maintenance, Materials, and Repairs | $53 | $48 | 10% | Sales and Marketing | $46 | $41 | 12% |
Profitability Metrics
For Q3 2024, Frontier reported a net income of $26 million, a significant recovery from a net loss of $32 million in Q3 2023. The airline's adjusted EBITDA was $177 million, up from $109 million in the same quarter last year.
| Profitability Metrics | Q3 2024 (in millions) | Q3 2023 (in millions) |
|---|---|---|
| Net Income (Loss) | $26 | ($32) |
| Adjusted EBITDA | $177 | $109 |
| Adjusted EBITDAR | $215 | $109 |
Financial Health
As of September 30, 2024, Frontier had total available liquidity of $576 million, which includes cash and cash equivalents along with $205 million available under its revolving loan facility. Total debt was reported at $469 million, with $190 million classified as short-term debt.
| Financial Health Metrics | As of September 30, 2024 |
|---|---|
| Total Available Liquidity (in millions) | $576 |
| Total Debt (in millions) | $469 |
| Short-term Debt (in millions) | $190 |
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Article updated on 8 Nov 2024
Resources:
- Frontier Group Holdings, Inc. (ULCC) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Frontier Group Holdings, Inc. (ULCC)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Frontier Group Holdings, Inc. (ULCC)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.