Spirit Airlines Inc.’s stock was rallying in premarket trading on Friday as the carrier said its bookings over the holidays were strong and that it’ll likely match or slightly beat Wall Street’s fourth-quarter revenue estimate.
Addressing doubts about its balance sheet due to the loss of its merger deal with JetBlue Airways Corp. JBLU, +7.79%, Spirit Airlines SAVE, -7.17% said it has $ 1.3 billion of liquidity as of Dec. 31, plus $ 300 million in a revolving credit facility.
“The company took several steps to shore up its liquidity to allow it time to make the necessary strategic shifts to enable [it] to compete effectively in the current demand backdrop and to return the business to profitability,” the carrier said in a filing.
Spirit Airlines stock jumped 19% in premarket trading as it closed out a bruising week by regaining some of its steep losses on Tuesday, when a federal judge blocked its proposed $ 3.8 billion acquisition by JetBlue.
Spirit Airlines estimated it would report fourth-quarter revenue of $ 1.32 billion, slightly ahead of the FactSet consensus estimate of $ 1.3 billion.
Spirit expects fourth-quarter capacity growth will be up by 1% to 2% year over year.
Spirit Airlines said it expects its total fourth-quarter revenue to be at the high end of its initial guidance, “as bookings for the peak travel period over Christmas and New Years were strong.”
Lower fuel costs will also keep operating expenses low, the company said.
Spirit Airlines said it raised $ 419 million in cash and repaid debt from sale-leaseback transactions on aircraft.
It also expects a “significant source of liquidity over the next couple of years” from negotiations with Pratt & Whitney on compensation for financial damages related to geared turbofan (GTF) neo-engine availability issues.
Spirit Airlines said it’s weighing options to refinance its 2025 debt maturities, including the $ 1.1 billion of aggregate principal amount of 8.00% senior secured notes.