In a financial report released on April 22, 2021, Alaska Airlines recorded its first cash positive month of the year, generating $1 million a day in March 2021, up from hemorrhaging $4 million a day in January and February 2021.
The Alaska Air Group sees this as an improvement to its revenue flows which reported a net loss of $131 million for the first quarter of 2021. This is a positive result for the group from a previous first quarter loss projection of $436 million which was averted by the Federal government pandemic payroll support received by the Alaska Airlines under the CARES Act during the period.
The airline has received $546 million through a combination of grants and loans from the U.S. Treasury under an extension of the PSP, and anticipates a supplemental payment of $80 million in late April 2021.
“It appears we have turned the corner,” said Air Group CEO Ben Minicucci to analysts, hinging the airlines shift in earnings on the return of leisure demand recorded in the first quarter and the efforts of the employees at Alaska and Horizon. “This has been a long road, and I want to thank the employees at Alaska and Horizon for providing great guest service and everything they’ve done to get through the last challenging year and help us achieve positive cash flow in March,” commends Minicucci. “We’re a big company, but still small enough that each person’s work makes a difference.”
Despite the challenges and uncertainties of the pandemic, which weakened the carriers balance sheet, plummeting revenues from its business lines in ticket sales, air cargo and Alaska Mileage Plan, the reduced fuel costs and maintenance bills from grounded aircraft, offered some relief.
The airline took delivery of four 737-9 MAX aircraft during the first quarter and finalized its existing purchase agreement with Boeing to expand its total 737-9 MAX firm deliveries to 68 between 2021 and 2024, inclusive of 13 leased aircraft.
Read more: Alaska Airlines firms its 120 Boeing 737 MAX order
The airline has promised “aggressive cost control and optimal productivity across its business lines.” Minicucci said the company is now “laser-focused” on returning to profitability and growth, which will include further cuts to the airline’s debt, planned in the latter half of 2021. The carrier projects a firm return to profitability in the third quarter of 2021
As of April 2021, Alaska Airlines’s debt is $1.6 billion, down from $1.7 billion in December 2020.