Frontier Airlines Reports Fourth Quarter Profit on Strong Revenue and Cost Performance

Frontier Airlines, Inc.

DENVER, Feb. 08, 2023 (GLOBE NEWSWIRE) -- Frontier Group Holdings, Inc. (Nasdaq: ULCC), parent company of Frontier Airlines, Inc., today reported profitable results for the fourth quarter of 2022 on strong revenue performance, including record ancillary revenue per passenger, and an improvement in unit costs.

Fourth Quarter 2022 Highlights

• Achieved total operating revenues of $906 million, 38 percent higher than the 2019 quarter on 15 percent higher capacity resulting in a 21 percent increase in revenue per available seat mile ("RASM") over the same period

• Generated record ancillary revenue of $82 per passenger, 41 percent higher than the 2019 quarter and five percent higher than the prior quarter

• Since exiting the pandemic, realized the lowest cost per available seat mile ("CASM") of 9.93 cents, CASM (excluding fuel), a non-GAAP measure, of 6.43 cents, and adjusted (non-GAAP) CASM (excluding fuel) of 6.40 cents

• Realized a pre-tax margin of 5.5 percent and an adjusted (non-GAAP) pre-tax margin of 5.7 percent

• Ended the quarter in a strong liquidity position with $761 million of unrestricted cash and cash equivalents, or $332 million net of total debt

• Took delivery of two A320neo and three A321neo aircraft during the fourth quarter, increasing the proportion of the fleet comprised of the more fuel-efficient A320neo family aircraft to 72 percent as of December 31, 2022, among the highest of all major U.S. carriers

• Generated 103 available seat miles ("ASM") per gallon, making Frontier the most fuel efficient of all major U.S. carriers and affirming its ongoing commitment to being "America's Greenest Airline"

• Expanded service in 16 domestic markets, including six new routes from Phoenix Sky Harbor International Airport to coincide with the November 2022 opening there of a crew base, and six international markets

• Announced new Dallas-Fort Worth crew base expected to open in May 2023 along with five new routes

• Launched GoWild All-You-Can-Fly Pass, providing passengers an opportunity for an unlimited number of flights to all Frontier domestic and international destinations

“Fourth quarter results were strong, underpinned by record ancillary revenue and meaningful improvements in CASM and utilization," commented Barry Biffle, President and CEO. “Moving into 2023, we intend to bolster our competitive edge by driving further improvement in ancillary revenue per passenger and unit costs. Today, our total cost advantage over the industry average is wider than it was in 2019, and I expect it will widen further this year. With these contributing factors, I'm confident we're on track to return the airline to the pre-pandemic profit levels per plane on a run-rate basis in the second half of 2023.

"I'm extraordinarily proud of Team Frontier for their tireless contributions in 2022 as we encountered repeated, uncontrollable operational challenges, including the recent winter storm Elliott. Our team overcame treacherous weather conditions, worked extended shifts and managed customer disruptions to get them to their destinations safely. I couldn't be more confident in Team Frontier and our future together as America's ultra-low-cost carrier."

Fourth Quarter and Full Year 2022 Select Financial Highlights

The following is a summary of fourth quarter and full year 2022 select financial results, including both GAAP and adjusted (non-GAAP) metrics. Refer to “Reconciliation of Non-GAAP Financial Information” in the appendix of this release.

(unaudited, in millions, except for percentages)
		Three Months Ended December 31,
			2022								2021								2019
		As Reported (GAAP)				Adjusted (Non-GAAP)				As Reported (GAAP)				Adjusted (Non-GAAP)				As Reported (GAAP)				Adjusted (Non-GAAP)
Total operating revenues		$	906			$	906			$	609			$	609			$	655			$	655
Total operating expenses		$	861			$	859			$	695			$	695			$	587			$	565
Pre-tax income (loss)		$	50			$	52			$	(86	)		$	(86	)		$	72			$	94
Pre-tax income (loss) margin			5.5	%			5.7	%		(14.1)%				(14.1)%					11.0	%			14.4	%
Net income (loss)		$	40			$	39			$	(53	)		$	(52	)		$	56			$	73

(unaudited, in millions, except for percentages)
		Year Ended December 31,
			2022								2021								2019
		As Reported (GAAP)				Adjusted (Non-GAAP)				As Reported (GAAP)				Adjusted (Non-GAAP)				As Reported (GAAP)				Adjusted (Non-GAAP)
Total operating revenues		$	3,326			$	3,326			$	2,060			$	2,060			$	2,508			$	2,508
Total operating expenses		$	3,371			$	3,352			$	2,177			$	2,461			$	2,199			$	2,167
Pre-tax income (loss)		$	(45	)		$	(19	)		$	(144	)		$	(406	)		$	325			$	357
Pre-tax income (loss) margin		(1.4)%				(0.6)%				(7.0)%				(19.7)%					13.0	%			14.2	%
Net income (loss)		$	(37	)		$	(17	)		$	(102	)		$	(299	)		$	251			$	276

Revenue Performance

Total operating revenue for the fourth quarter of 2022 was $906 million, 38 percent higher than the 2019 quarter, with total operating revenue per passenger of $133, 24 percent higher than the 2019 quarter. Ancillary revenue per passenger was a record $82, 41 percent higher than the 2019 quarter. RASM was 10.45 cents, 21 percent higher compared to the 2019 quarter, alongside capacity growth of 15 percent over the same period.

Average daily aircraft utilization in the fourth quarter increased four percent from the prior quarter to 11.5 hours per day, with further improvement expected to over 12 hours per day, on average, in 2023 as the trend toward normalized operations continues.

Cost Performance

Total operating expenses for the fourth quarter of 2022 were $861 million, including $2 million in employee retention costs associated with the Company's terminated combination with Spirit Airlines, Inc. ("Spirit"). Excluding this item, adjusted (non-GAAP) total operating expenses were $859 million, including $304 million of fuel expenses at an average cost of $3.60 per gallon. Adjusted (non-GAAP) total operating expenses (excluding fuel) were $555 million.

CASM was 9.93 cents in the fourth quarter, while adjusted (non-GAAP) CASM was 9.91 cents. CASM (excluding fuel), a non-GAAP measure, was 6.43 cents, while adjusted (non-GAAP) CASM (excluding fuel) was 6.40 cents, seven percent lower than the prior quarter and two percent lower than the 2021 quarter.

Earnings

Earnings before taxes for the fourth quarter of 2022 were $50 million, or $52 million on an adjusted (non-GAAP) basis excluding special items, reflecting a pre-tax margin of 5.5 percent and an adjusted (non-GAAP) pre-tax margin of 5.7 percent. Winter storm Elliott is estimated to have negatively impacted pre-tax income by approximately $16 million, or 175 basis points on pre-tax margin.

Net income for the fourth quarter of 2022 was $40 million, or $39 million on an adjusted (non-GAAP) basis excluding special items.

Cash and Liquidity

Unrestricted cash and cash equivalents as of December 31, 2022 totaled $761 million, or $332 million net of total debt. The Company repaid its $150 million U.S. Treasury loan (the "Treasury Loan") in February 2022 and is able to access substantial liquidity, if desired, through its co-branded credit card program and related brand assets, based on similar debt financings by other airlines.

Fleet

As of December 31, 2022, Frontier had a fleet of 120 Airbus single-aisle aircraft, per the schedule below, all financed with operating leases that expire between 2023 and 2034.

Equipment	Quantity	Seats
A320neo	82	186
A320ceo	13	180 - 186
A321ceo	21	230
A321neo	4	240
Total fleet	120

Frontier is America's Greenest Airline measured by ASMs per fuel gallon consumed. During the fourth quarter of 2022, Frontier generated 103 ASMs per gallon, four percent higher than the 2019 quarter. To learn more about Frontier's sustainability initiatives, visit www.flygreener.com.

Frontier took delivery of two A320neo and three A321neo aircraft during the fourth quarter of 2022, increasing the proportion of the fleet comprised of the more fuel-efficient A320neo family aircraft to 72 percent as of December 31, 2022, among the highest of all major U.S. carriers. The A321neo is expected to unlock meaningful scale efficiencies by way of fuel savings and higher average seats per departure. As of December 31, 2022, over 70 percent of future committed aircraft deliveries, including direct leases, are for A321neo aircraft.

As of December 31, 2022, the Company had commitments for an additional 231 aircraft to be delivered through 2029, including purchase commitments for 67 A320neo aircraft and 154 A321neo aircraft and another 10 A321neo aircraft through direct leases.

In December 2022, Airbus notified the Company of its intent to shift aircraft deliveries by a range of one to five months for aircraft initially scheduled in 2023, causing nine A321neo aircraft to shift into 2024 from 2023 and reducing available capacity growth in 2023 by approximately five percent.

Forward Guidance

The first quarter 2023 and full-year 2023 guidance provided below is based on the Company's current estimates and is not a guarantee of future performance. This guidance is subject to significant risks and uncertainties that could cause actual results to differ materially, including the risk factors discussed in the Company's reports on file with the SEC. Frontier undertakes no duty to update any forward-looking statements or estimates, except as required by applicable law. Further, this guidance excludes special items and the reconciliation of non-GAAP measures to the comparable GAAP measures because such amounts cannot be determined at this time.

Capacity is anticipated to grow 17 to 19 percent in the first quarter of 2023 compared to the 2022 quarter, while full-year capacity is expected to grow 23 to 28 percent over 2022 after accounting for the aforementioned delays in A321neo aircraft deliveries. Given the unit cost efficiencies expected from the A321neo aircraft, the Company now expects adjusted (non-GAAP) CASM (excluding fuel) to be below six cents during the second half of 2023 and modestly above six cents for the full year, a level which the Company expects will be materially below the industry average.

Fuel costs in the first quarter are expected to be $3.50 to $3.55 per gallon and $3.05 to $3.15 per gallon for full-year 2023 based on the blended fuel curve on January 30, 2023. Adjusted (non-GAAP) total operating expenses (excluding fuel) for the first quarter are anticipated to be $570 to $595 million and $2,425 to $2,525 million for full-year 2023. The effective tax rate for both the first quarter and full-year 2023 is estimated to be approximately 24 percent. Elevated fuel prices and the seasonal effect of leisure travel flows are anticipated to result in an adjusted (non-GAAP) pre-tax loss in the first quarter, reflecting an expected margin between (2) and (6) percent (excluding special items). Pre-delivery deposits, net of refunds, are expected to be in the range of approximately $120 - $200 million and other capital expenditures are expected to be $145 to $165 million, each for full-year 2023.

The current forward guidance estimates are presented in the following table:

	First Quarter
	2023(a)
Capacity growth (versus 1Q 2022)(b)	17% to 19%
Adjusted (non-GAAP) total operating expenses (excluding fuel) ($ millions)(c)	$570 to $595
Average fuel cost per gallon(d)	$3.50 to $3.55
Effective tax rate	~24%
Adjusted (non-GAAP) pre-tax margin	(2)% to (6)%

	Full Year
	2023(a)
Capacity growth (versus 2022)(b)	23% to 28%
Adjusted (non-GAAP) total operating expenses (excluding fuel) ($ millions)(c)	$2,425 to $2,525
Average fuel cost per gallon(d)	$3.05 to $3.15
Effective tax rate	~24%
Pre-delivery deposits, net of refunds ($ millions)	$120 - $200
Other capital expenditures ($ millions)(e)	$145 to $165

_________________

(a)	Includes guidance on certain non-GAAP measures, including adjusted total operating expenses (excluding fuel) and adjusted pre-tax margin, and which excludes, among other things, special items. The Company is unable to reconcile these forward-looking projections to GAAP as the nature or amount of such special items cannot be determined at this time.
(b)	The Company's guidance is based on its expectation that customer demand and the airline's operations will continue to recover to more normalized levels; the Company will monitor and adjust capacity levels as appropriate. Given the dynamic nature of the current demand environment, actual capacity adjustments made by the Company may be materially different than what is currently expected.
(c)	Amount estimated excludes fuel expense and special items, the latter of which are not estimable at this time. The amount takes into consideration the additional expected capacity and the Company's continued investment in the post-pandemic recovery. Estimated fuel cost per gallon is based upon the blended jet fuel curve on January 30, 2023 and is inclusive of estimated fuel taxes and into-plane fuel costs.
(d)	Other capital expenditures estimate includes capitalized heavy maintenance.

Conference Call

The Company will host a conference call to discuss fourth quarter 2022 results today, February 8, 2023, at 4:30 p.m. Eastern Standard Time (USA). Investors may listen to a live, listen-only webcast available on the investor relations section of the Company's website at https://ir.flyfrontier.com/news-and-events/events. The call will also be archived and available for 90 days on the investor relations section of the Company's website.

About Frontier Airlines

Frontier Airlines, Inc., a subsidiary of Frontier Group Holdings, Inc. (Nasdaq: ULCC), is committed to “Low Fares Done Right.” Headquartered in Denver, Colorado, the Company operates 120 A320 family aircraft and has among the largest A320neo family fleets in the U.S. The use of these aircraft and Frontier’s seating configuration, weight-saving tactics and baggage process have all contributed to Frontier’s continued ability to be the most fuel-efficient of all major U.S. carriers when measured by ASMs per fuel gallon consumed. With more than 230 new Airbus planes on order, including direct leases, Frontier will continue to grow to deliver on the mission of providing affordable travel across America.

Cautionary Statement Regarding Forward-Looking Statements and Information

Certain statements in this release should be considered forward-looking statements within the meaning of the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on the Company’s current expectations and beliefs with respect to certain current and future events and anticipated financial and operating performance. Such forward-looking statements are and will be subject to many risks and uncertainties relating to the Company’s operations and business environment that may cause actual results to differ materially from any future results expressed or implied in such forward-looking statements. Words such as "expects," "will," "plans," "intends," "anticipates," "indicates," "remains," "believes," "estimates," "forecast," "guidance," "outlook," "goals," "targets" and similar expressions are intended to identify forward-looking statements. Additionally, forward-looking statements include statements that do not relate solely to historical facts, such as statements which identify uncertainties or trends, discuss the possible future effects of current known trends or uncertainties, or which indicate that the future effects of known trends or uncertainties cannot be predicted, guaranteed or assured. All forward-looking statements in this release are based upon information available to the Company on the date of this release. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, changed circumstances or otherwise, except as required by applicable law.

Actual results could differ materially from these forward-looking statements due to numerous factors including, without limitation, the following: unfavorable economic and political conditions in the states where the Company operates and globally, including an inflationary environment and potential recession, and the resulting impact on cost inputs and/or consumer demand for air travel; the highly competitive nature of the global airline industry and susceptibility of the industry to price discounting and changes in capacity; the Company's ability to attract and retain qualified personnel at reasonable costs; the potential future impacts of the COVID-19 pandemic, and possible outbreaks of another disease or similar public health threat in the future, on the Company’s business, operating results, financial condition, liquidity and near-term and long-term strategic operating plan, including possible additional adverse impacts resulting from the duration and spread of the pandemic; high and/or volatile fuel prices or significant disruptions in the supply of aircraft fuel, including as a result of the war between Russia and Ukraine; the Company's reliance on technology and automated systems to operate its business and the impact of any significant failure or disruption of, or failure to effectively integrate and implement, the technology or systems; the Company’s reliance on third-party service providers and the impact of any failure of these parties to perform as expected, or interruptions in the Company's relationships with these providers or their provision of services; adverse publicity and/or harm to the Company's brand or reputation; reduced travel demand and potential tort liability as a result of an accident, catastrophe or incident involving the Company, its codeshare partners or another airline; terrorist attacks, international hostilities or other security events, or the fear of terrorist attacks or hostilities, even if not made directly on the airline industry; increasing privacy and data security obligations or a significant data breach; further changes to the airline industry with respect to alliances and joint business arrangements or due to consolidations; changes in the Company's network strategy or other factors outside its control resulting in less economic aircraft orders, costs related to modification or termination of aircraft orders or entry into less favorable aircraft orders; the Company's reliance on a single supplier for its aircraft and two suppliers for its engines, and the impact of any failure to obtain timely deliveries, additional equipment or support from any of these suppliers; the impacts of union disputes, employee strikes or slowdowns, and other labor-related disruptions on the Company's operations; extended interruptions or disruptions in service at major airports where the Company operates; the impacts of seasonality and other factors associated with the airline industry; the Company's failure to realize the full value of its intangible assets or its long-lived assets, causing the Company to record impairments; the costs of compliance with extensive government regulation of the airline industry; costs, liabilities and risks associated with environmental regulation and climate change; the Company's inability to accept or integrate new aircraft into the Company's fleet as planned; the impacts of the Company's significant amount of financial leverage from fixed obligations, the possibility the Company may seek material amounts of additional financial liquidity in the short-term and the impacts of insufficient liquidity on the Company's financial condition and business; failure to comply with the covenants in the Company's financing agreements or failure to comply with financial and other covenants governing the Company's other debt; changes in, or failure to retain, the Company's senior management team or other key employees; current or future litigation and regulatory actions, or failure to comply with the terms of any settlement, order or arrangement relating to these actions; increases in insurance costs or inadequate insurance coverage; and other risks and uncertainties set forth from time to time under sections captioned "Risk Factors" in the Company's reports and other documents filed with the Securities and Exchange Commission, including the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2022.

Frontier Group Holdings, Inc.
Consolidated Statements of Operations
(unaudited, in millions, except for per share data)

		Three Months Ended December 31,												Percent Change						Year Ended December 31,												Percent Change
			2022				2021				2019			2022 vs. 2021			2022 vs. 2019				2022				2021				2019			2022 vs. 2021			2022 vs. 2019
Operating revenues:
Passenger		$	887			$	592			$	638			50	%		39	%		$	3,248			$	2,000			$	2,445			62	%		33	%
Other			19				17				17			12	%		12	%			78				60				63			30	%		24	%
Total operating revenues			906				609				655			49	%		38	%			3,326				2,060				2,508			61	%		33	%
Operating expenses:
Aircraft fuel			304				186				172			63	%		77	%			1,160				575				640			102	%		81	%
Salaries, wages and benefits			187				162				156			15	%		20	%			715				616				529			16	%		35	%
Aircraft rent			155				131				98			18	%		58	%			556				530				368			5	%		51	%
Station operations			96				99				84			(3)%			14	%			422				384				336			10	%		26	%
Sales and marketing			44				29				34			52	%		29	%			164				109				130			50	%		26	%
Maintenance, materials and repairs			39				37				26			5	%		50	%			146				119				86			23	%		70	%
Depreciation and amortization			9				10				11			(10)%			(18)%				45				38				46			18	%		(2)%
CARES Act credits			—				—				—			N/M			N/M				—				(295	)			—			N/M			N/M
Transaction and merger-related costs, net			2				—				—			N/M			N/M				10				—				—			N/M			N/M
Other operating			25				41				6			(39)%			317	%			153				101				64			51	%		139	%
Total operating expenses			861				695				587			24	%		47	%			3,371				2,177				2,199			55	%		53	%
Operating income (loss)			45				(86	)			68			N/M			(34)%				(45	)			(117	)			309			(62)%			N/M
Other income (expense):
Interest expense			(5	)			(2	)			(3	)		150	%		67	%			(21	)			(33	)			(11	)		(36)%			91	%
Capitalized interest			5				1				3			400	%		67	%			11				4				11			175	%		—	%
Interest income and other			5				1				4			400	%		25	%			10				2				16			400	%		(38)%
Total other income (expense)			5				—				4			N/M			25	%			—				(27	)			16			N/M			N/M
Income (loss) before income taxes			50				(86	)			72			N/M			(31)%				(45	)			(144	)			325			(69)%			N/M
Income tax expense (benefit)			10				(33	)			16			N/M			(38)%				(8	)			(42	)			74			(81)%			N/M
Net income (loss)		$	40			$	(53	)		$	56			N/M			(29)%			$	(37	)		$	(102	)		$	251			(64)%			N/M
Earnings (loss) per share:
Basic (a)		$	0.18			$	(0.25	)		$	0.26			N/M			(31)%			$	(0.17	)		$	(0.48	)		$	1.19			(65)%			N/M
Diluted (a)		$	0.18			$	(0.25	)		$	0.26			N/M			(31)%			$	(0.17	)		$	(0.48	)		$	1.19			(65)%			N/M
Weighted average shares outstanding:
Basic (a)			218				216				199			1	%		10	%			218				211				199			3	%		10	%
Diluted (a)			220				216				200			2	%		10	%			218				211				200			3	%		9	%

__________________
N/M = Not meaningful

(a)

Share amounts included in the basic and diluted earnings (loss) per share calculations for 2022 and 2021, as reflected in the consolidated statements of operations, include the impact of the 15 million shares issued and sold by the Company as part of its initial public offering that closed on April 6, 2021. Additionally, in periods of net income, the dilutive impact of the 3.1 million warrants outstanding relating to CARES Act funding, any non-participating options and unvested restricted stock units are included in the diluted earnings per share calculations. In addition, most of the Company's 7.3 million outstanding options are participating securities and are therefore not expected to be part of the Company's diluted share count under the two-class method until they are exercised, but, in periods of net income, are included as an adjustment to the numerator of the Company's earnings per share calculation as they are eligible to participate in the Company's earnings. The participating securities impact has been subtracted from periods presented with positive net income in the computation of basic and diluted earnings per share.

Frontier Group Holdings, Inc. Selected Operating Statistics (unaudited)
	Three Months Ended December 31,									Percent Change						Year Ended December 31,									Percent Change
	2022			2021			2019			2022 vs. 2021			2022 vs. 2019			2022			2021			2019			2022 vs. 2021			2022 vs. 2019
Available seat miles (ASMs) (millions)	8,670			7,836			7,560			11	%		15	%		31,746			26,867			28,120			18	%		13	%
Departures	43,407			41,523			37,768			5	%		15	%		165,447			143,476			138,570			15	%		19	%
Average stage length (miles)	1,032			975			1,039			6	%		(1)%			991			968			1,051			2	%		(6)%
Block hours	121,623			111,363			105,327			9	%		15	%		451,156			381,018			389,476			18	%		16	%
Average aircraft in service	115			111			94			4	%		22	%		112			106			88			6	%		27	%
Aircraft – end of period	120			110			98			9	%		22	%		120			110			98			9	%		22	%
Average daily aircraft utilization (hours)	11.5			10.9			12.1			6	%		(5)%			11.1			9.8			12.2			13	%		(9)%
Passengers (thousands)	6,836			5,896			6,110			16	%		12	%		25,486			20,709			22,823			23	%		12	%
Average seats per departure	193			193			192			—	%		1	%		193			193			192			—	%		1	%
Revenue passenger miles (RPMs) (millions)	7,122			5,818			6,406			22	%		11	%		25,669			20,380			24,203			26	%		6	%
Load Factor	82.1	%		74.2	%		84.7	%		7.9pts			(2.6)pts			80.9	%		75.9	%		86.1	%		5.0pts			(5.2)pts
Fare revenue per passenger ($)	50.76			40.41			49.12			26	%		3	%		54.22			38.94			52.80			39	%		3	%
Non-fare passenger revenue per passenger ($)	78.99			60.00			55.31			32	%		43	%		73.21			57.65			54.33			27	%		35	%
Other revenue per passenger ($)	2.77			3.00			2.87			(8)%			(3)%			3.07			2.90			2.78			6	%		10	%
Total ancillary revenue passenger ($)	81.76			63.00			58.18			30	%		41	%		76.28			60.55			57.11			26	%		34	%
Total revenue per passenger ($)	132.52			103.41			107.30			28	%		24	%		130.50			99.49			109.91			31	%		19	%
Total revenue per available seat mile (RASM) (¢)	10.45			7.78			8.67			34	%		21	%		10.48			7.67			8.92			37	%		17	%
Cost per available seat mile (CASM) (¢)	9.93			8.87			7.78			12	%		28	%		10.62			8.10			7.82			31	%		36	%
CASM (excluding fuel) (¢)	6.43			6.50			5.51			(1)%			17	%		6.96			5.96			5.55			17	%		25	%
CASM + net interest (¢)	9.87			8.88			7.73			11	%		28	%		10.62			8.21			7.76			29	%		37	%
Adjusted CASM (¢)	9.91			8.87			7.48			12	%		32	%		10.56			9.16			7.71			15	%		37	%
Adjusted CASM (excluding fuel) (¢)	6.40			6.50			5.21			(2)%			23	%		6.90			7.02			5.44			(2)%			27	%
Adjusted CASM + net interest (¢)	9.85			8.88			7.43			11	%		33	%		10.54			9.18			7.65			15	%		38	%
Fuel cost per gallon ($)	3.60			2.43			2.24			48	%		61	%		3.72			2.17			2.22			71	%		68	%
Fuel gallons consumed (thousands)	84,556			76,555			76,736			10	%		10	%		312,115			265,558			288,510			18	%		8	%
Full-Time Equivalent Employees (FTEs)	6,450			5,481			4,935			18	%		31	%		6,450			5,481			4,935			18	%		31	%

Reconciliation of Non-GAAP Financial Information

The Company is providing below a reconciliation of GAAP financial information to the non-GAAP financial information provided. The non-GAAP financial information is included to provide supplemental disclosures because the Company believes they are useful additional indicators of, among other things, its operating and cost performance. These non-GAAP financial measures have limitations as analytical tools. Because of these limitations, determinations of the Company’s operating performance or CASM excluding unrealized gains and losses, special items or other items should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. These non-GAAP financial measures may be presented on a different basis than other companies using similarly titled non-GAAP financial measures.

Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss) and Adjusted Pre-tax Income (Loss)
($ in millions) (unaudited)

Three Months Ended December 31,

Year Ended December 31,...