Virgin America (VA) Tops Q4 EPS Views; Comments on Q1 Outlook

Virgin America (NASDAQ: VA) reported Q4 EPS of $1.16, $0.37 better than the analyst estimate of $0.79. Revenue for the quarter came in at $372.2 million versus the consensus estimate of $370.57 million.

• Revenue per Available Seat Mile (RASM): RASM increased 3.7 percent compared to the fourth quarter of 2013, to 12.23 cents. Year-over-year RASM growth was driven by a 2.7 point increase in load factor, offset partially by a 1.8 percent decline in yield, and also by a 25.5 percent growth in other revenue attributable to Virgin America's new co-branded credit card agreement that was implemented in early 2014 and strength in other ancillary products.
• Cost per Available Seat Mile (CASM): Total CASM excluding special items increased 0.7 percent compared to the fourth quarter of 2013, to 11.10 cents. CASM excluding special items, fuel costs and profit sharing for the quarter increased 4.2 percent year-over-year, to 7.16 cents.

First Quarter 2015 Outlook

The Company expects capacity, as measured by available seat miles, to increase by approximately 2.0 percent to 3.0 percent for the first quarter of 2015 as compared to the first quarter of 2014. Based on current revenue trends, the Company expects PRASM to change between -1.0 percent and +1.0 percent versus the first quarter of 2014. The Company expects CASM excluding fuel and profit sharing to increase between +1.0 percent and +3.0 percent versus the first quarter of 2014.

Based on Virgin America's hedge portfolio and current market prices for aviation fuel products, the Company expects Virgin America's economic fuel cost per gallon inclusive of related taxes and hedge costs to average between $2.45 and $2.55 for the first quarter of 2015. This number may change depending on fluctuations in market prices for jet fuel during the quarter.

For earnings history and earnings-related data on Virgin America (VA) click here.

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