SkyWest (SKYW) 30 Oct 192019 Q3 Earnings call transcript

Good day, and welcome to the Skywest Incorporated Third Quarter 2019 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded.

I would now like to turn the conference over to Rob Simmons, Chief Financial Officer. ahead. go Please

joining for the today. call Thanks, us everyone, on

is SkyWest’s Chief As the Officer. Simmons, this indicated, operator Financial Rob

On the Commercial Chief SkyWest Executive Chief call President Officer; Airlines Officer; Childs, with Accounting Wade me Chief today Operating Steel, Mike Chief and Officer; Officer. Woodward, are Eric Thompson, Chip and

read time like Chip over I’d to for start Then Harbor. some by today Safe to to I’ll Eric comments. asking the turn the

and will related take will through financial discuss us the Wade fleet arrangements. Following Chip, I flying results. the Then

Following Q&A Eric? Wade, the with session customary we will have sell-side analysts.

vary beliefs, reasons. Today’s and are those from statements discussion uncertainties. to results of contains that or and forward-looking estimated risks anticipated, likely forward-looking to regarding represents We for and may our events vary any a current no number obligation Actual update expectations materially future assume projected and assumptions statement. subject will

may the our and Form XX-K factors of included Securities are Exchange Some and the in that such XXXX with and reports cause other differences filings Commission.

turn I’ll to the over that, With Chip. call

Thank afternoon, on you, thanks and Good everyone, Eric. call today. us the joining for and Rob

a footprint. build and a strong move airline as half more as we of on continue fleet to forward quarter Third single a with initiatives XXXX monetize efficient our first

Third terms results. this the here often the reflects year quarter is of busiest of those seasonally in departures and

quarter just employees to continuing and improve the XX.X% did our for Our a performance. completion remarkable solid job a adjusted on-time delivering

to for for efforts employees I our XX,XXX work and want deliver to our thank great customers. their together a product nearly

going going XXXX. and starting EXXXs contract American starting QX execute six Delta contract used July early on XXXX. August. wins contract flying three we in used continue with CRJXXXs in We and early for prepare EXXXs in Seven for announced XX into beginning in new and to into

of market limitations, ability deliver share have within making scope we a us ensure reliable partners our along than product. this four focused of would and our a customers’ existing for gains. to together without daily illustrate something people quality onboard for future seamless recently be our that set our deals and than more needs departures, do with is remain better other The and efficient to consistently product while carrier. SkyWest providing unlock partners up to and agile working our to growth and service are X,XXX growth on possible progress any in made other also responsive continue years These delivering we customers people None opportunities our ability

operational limitations competitive strong manage older fleet We CRJ our much to planing and continue changing previously stronger than future reliability to the a to demand led dynamics into for for have older expected. through fleet XXXX during Scope to fleet. product. customer designed the we response performance our of to market In of invest the further we improve the our this of are in half first demand, our sectors

We intend Even will to and leveraging scope. earnings set in assets the details operational the market a the an give in to to with be XXXX, of position will XXXX our continue this more on in minute. investment, expect stronger even but we for XXXX. continue growth value up within that Rob our realize we

into needs. in able convert partners’ our to also respond fortunate to strong and availability are the position to We to be pilot opportunity quickly market

hiring running levels. and XX% more team recruiting above strong year’s is product than last still and culture, our With quality pilot opportunities,

is years about ago. up our pipeline This quarter, hiring half last another just five XX% that pipeline, is from last mentioned we reduced As year. area over risk of current meaningfully that from the the existing

opportunities help risk remain balance year cash of reduces that growth success. business drive our on for overall our generation. position contract wins will We and us and earnings flow recent sustainable model healthy Our reshaping us this enterprise combined long-term a with very earlier focused

to their for quarter. excellent want during work thank great the Rob? I third professionals our aviation of team again

income $XX quarter to third $XX million last reported we million Today, in compared net quarter the third year.

earnings per in $XXX of pretax income up quarter million third share QX million $X.XX XX% QX in from for share quarter $X.XX, XXXX. of Pretax XXXX. from up the per Third is of is $XXX income

XX.X diluted QX down Our year. share million, of last count X.X%, million or X.X is shares from

XX% XX%, Our down in effective rate QX XXXX. tax QX in was slightly from

for We of continue rate tax fiscal XXXX. XX% to for be approximately and QX expect to our XXXX

of million as CapEx, quarter. quarter repurchases; uses things last September with and million engines of Primary quarter million slightly early; XXXX. sheet XX, for quarter in quarter. Let acquire ended of from maintenance about our million spare me other spare $XX cash $XXX $XX the say million included at $XX assets. CRJXXXs including to $XX $X the last for Debt $XXX leased We the four of down and a $XXX share billion from in cash up couple for ended parts balance billion, $X.X million off million, for

a about say expenditures. things Let me few capital

billion XX you few As years, XXXX, expect to we million we aircraft driven invested In In new in for have EXXXs. spent the heavily CapEx, XXXX, primarily growth in $XXX $X.X to expect fleet. cash the by we million our the last recall, deploy the acquisition could approximately XXXX a driver key Absent aircraft CapEx full million XXXX any in in $XXX be a CapEx flow free for additional in orders, year. XXXX. to $XXX would doubling what range, new in over of we be

orders. the on billion to end $X We come of levels again, to under debt by down XXXX, by $X will under of end could continue be billion the and depending that additional expect XXXX,

our financing EXXXs largely is a under are that bulk in that billion our fleet our aircraft, $X the coterminous flying Just financing of debt all related the contracts of debt and debt. of XXX with reminder is

year any. term principal repayment any expect to mortgage-style amortization through if orders, continue its of in financings each aircraft $XXX before the We new to to embedded pursuant future debt new of for delever in debt via new million

that sheet and to next balance our agility liquidity, cash the incremental market quickly strong maintain any to over maintain generation will years strong expect us respond We delever couple opportunities. to of the allow

program under February. repurchased repurchases. During of by we to returning under million and dividends program. to Board capital combination This remaining share shareholders QX, in approved the million committed million leaves $XX in a in via $XXX $XXX remain authorization this We us our stock

As per let policy and our practice, giving me and few a QX EPS without say XXXX fiscal about guidance. things formal

strong QX expect QX XXXX, As to would usual, season. cover and we summer QX the falloff levels in seasonal see normal earnings the that from

in per we digit spend. slower XXXX, driven CapEx and levels in fiscal mid-to-high older XXXX could double the We see would over the flat flow Chip the XXXX EBITDA be growth by per in XXXX share slightly to growth of of For cash earnings fleet XXXX. in referenced half from earnings XXXX Free in share the first to of expect first expect earlier. to the single investment by part would half due to from up

XXXX operational earnings have performance million in digit stronger than per over $XX fiscal ongoing improve CRJ into XXXX, the of expected originally scope is to investment mid-to-high leading XXXX. our fiscal reliability and fleet to half limitations. demand, we share response future This growth single the in EPS to in We of expect for growth and second would customer stronger further would

otherwise half of XXXX is would in possible additional this the and extensions in been us market case. maintenance additional for first orders and additional new XXXX scenario incremental better to share up this fleet leasing sets the XXXX from Investing $XX of have aircraft, fleet Upside million wins, opportunities. than

future investments shareholder to to value. us visibility continue create Our to cash flow confidence the to gives make disciplined

This investment opportunities if opportunities and As include new to strong capital a future ready flying with growth come, leasing. balance demonstrate contract or we sheet. when liquid in continue could will be flying, organic prorate deployment we and

returning to to and will shareholders of dividends. via share course, addition at In growth capital organic look to opportunities, we continue repurchase

As flow. we growth between drive are healthy a Chip striving mentioned, cash balance earnings and to

fleet opportunities. Wade initiatives, some movements give fleet will you other and now commercial Wade? on details

Rob. you, Thank

Also regional in that Delta for by to purchase we financed operate The SkyWest by announced of August, have an in the of XXXX. delivery a from announced a scheduled operator agreed and in Delta to August, out has begin new agreement seven under SkyWest were be Delta, EXXXs financed As in connection. six with are early to aircraft sourced Delta operate will instead contract XXXX. and scheduled Delta be used multiyear operating CRJXXXs transitioning new EXXXs for and to seven we

received stream, our new during third for we quarter aircraft Delta. one delivery summarize CRJXXX To the

CRJXXXs year. by are the We owned scheduled stream next These financed are to at take of more This one CRJXXX delivery and will our aircrafts. XX new Delta. CRJXXXs delivery conclude for

end of our and We of of during This QX, will year. Delta five are new to half the total scheduled delivery new six fleet to in EXXXs mid-XXXX. first bring EXXXs the by used by six EXXX XXX for XXXX EXXXs also next take

me talk American about our Let partnership.

our attractive prorate approximately million investment CRJXXXs quarter, contracts. to customer for further to show this improve with half add extensions major result As our experience. return and strong. its our an a This on system And in anticipate aircraft the the under contract allow strong customer to This reliability $XX to agreement an announced demand, we placed and will us it our work CRJXXXs anticipate XX during to additional that as We first remains grow bring total should of contract. continue we our investing to RJ to fleet into small as long-term throughout American very Demand will these XXXX. partners flying XXXX fleet discussed last XX being of business.

leasing me to we continue business, opportunity. Let to gears leverage shift where our

our a of be XX delivered a party, four the the the anticipate majority delivery agreement, additional previous from and delivered we quarter, be previously, from lease This the these CRJXXXs that These through with we will aircraft bringing of our agreement remaining CRJXXXs aircrafts ExpressJet aircraft domestic year. five announced operation. are next will third communicated middle Also XX count under of to XX-year the sourced we aircraft. previously under

We have aircraft CRJXXXs under a end We remaining six-year leased of year. five of Canada agreement. will lease also to delivered this Air four be the by the anticipate delivered

under agreement we expire four are XXXX, scheduled four aircraft to with in Delta our QX CRJXXXs lease an buyout. XXXX. early These During acquired under

purchase also a or have third XX the We operating and used seven of a for CRJXXXs our partners these leasing to party. a party. combination aircraft to through engines third the from anticipate utilizing aircraft agreed We aircraft

XXXX. used be term. our CFXX-X XX XX Finally, with an engines The in during we million will with third to engines, help anticipated used engines an will to then Delta. $XX five-year support fleet the the lease will to already lease fund quarter, This the is engines we be to under Delta which addition in invested spare CFXX-X

We late next the XX of mid-XXXX. delivery expect to through year the engines begin

execution platform over the of built these model discussed, we’ve positioned help beyond. years unique ongoing and XXXX flexible utilize well I’ve enhance risk. continue position our for for we will past fleet As profitable we’re our agreements and to We leveraging several and ensure the minimize opportunities, anticipate to

we’re Okay. Operator, now. ready for session Q&A the

from the session. Company. We’ll & Sidoti with first go Instructions] question now begin comes Steve [Operator question-and-answer Please O’Hara ahead. The

for Thanks afternoon. taking good my question. Hi,

Hey Steve.

Hi. I commitments the next. just the guess of first moves the this and year aircraft on and for

ones all EXXXs of you’re terms correct? in Is ones that next own not You are taking own this year. coming year the that the that but

Steve, this is Wade.

we will There own delivery own financed another will we are will that EXXXs that of we’re that during used six those. QX operating for has be new So connection Delta the also five Delta carrier. EXXXs XXXX, Delta EXXXs will first half also and for those. in take of the There new six XXXX, we of

will that not Now over own. they will we transition us to

stream the so how And – those that’s goes.

thank half That’s of growth. about the you. XXXX the on And Okay, just the earnings expectations helpful. first around and commentary of kind then

is the of flying you’re Or continued you. I’m on maintenance to through things So it up that? pilots building wondering this expense that those half in capitalized and maintenance much and CRJs slightly around first let’s the like just half, – line? the And is half And that was it maybe – as how or is just taking think, flat does guess, run versus to into first I aircraft. I comment the the say, second for the Thank due well?

as half of picks we then in a of well first like a growth as that, like the XXXX investment, is in the result fleet first half and run EPS. the already that will service the terms Steve. outlined of result P&L. second Thanks, And the expense of what we that not, other seasonal component factors But lower that XXXX The deliveries of again, look XXXX, that up Wade through the of obviously, first half lot as first a $XX and the million the the said, be Yes. of into to would in will half expect, coming XXXX. as of the in half

think, what Is based was commentary seems it was maybe looking that I XXXX that better on would like was earnings comment right then the XXXX the now, that made? see you’re and at growth – XXXX. And Okay. lastly, than just that

that of and a the comment the that plan XXXX, the any XXXX think message specifics, make do think we’ll investments to – up things set up us Yes, be will we in for that from But I set was obviously, the which that will into I this XXXX year we’ll, without XXXX. now. some very nicely getting for year doing up us nicely was

Thank you Okay. much. very

go comes ISI. Our Evercore Duane question next ahead. Please from Pfennigwerth with

Hey, thanks.

it any into that? CRJXXXs. be there universe them point road? that that Is XXXs XX, that chance operating be is total could you’re than that at bigger some amount? the the On leasing out down Or going of be you’d And to are the transformed

now, is fly This XX that’s in party under to Right we Duane. XXX. to aircraft lease a currently that them have going Wade. Yes, third commitment to

CRJXXXs additional our have We in fleet.

We right of have the that. conversations aircraft all strong we’re having very very small extremely and around with in our now, demand for partners those. said I good the conversations CRJ demand my good for the script around is everyone with

So of use the we’re our definitely of those partners working aircraft. with on all best

operating want of isn’t round? Was to do just proven Why In why operating a type out? the you you fleet a function SkyWest first this economics, see aren’t those? word, it or

Chip. It’s Duane,

And this worked I an From question your our our comments be EXXX to when we’re extremely mean, now, block the right this. I to what able think would hours are at in I two is from answered underlying think – full. for term little look plate us I out you do there. the doing perspective, is fleet, you our just well enterprise our as perspective, doing, and what with bit just the a

XXXs? Your answered first these fly XXXs question is, Wade any there we may a well. really or question that ever is chance that think I

probably We’re well. do it and the how world, the in to operator largest CRJXXXs of know we really

spend making way. on that so And operation can overall that a we value the well our lot want balancing add think we components here leasing of a do these our where those – as we business point focus as look, some that aircraft, shareholders best to that time of and to and partners we is something model sure of through things we I the right is the have the

Okay. Leave you. thank it there,

The James. with next question comes from Savi Syth Raymond Please go ahead.

Hey, good afternoon.

Hi, Savi.

Hey.

also million $XX the how more or extended or the interior of Is there of CRJXXX just that the that extending as about that on clarification aircraft investment. of the the Just you for the XXXs kind kind is of investment? And adjustments if much life life the of well, XXXs? gets just aircraft, and curious fleet and this doing with are just

Wade. is Yes, Savi. This

would and include the CRJXXXs. fleet, the $XX is the it So my said the million both for which I RJ was script, – small in CRJXXXs

make going the well We’re reliability changes the both a as campaign, customer we’re to also interior to going some aircraft enhance of experience. to the then and through

to going doing be We’ve it’s life So the of the the a these. to couple been extend CRJXXX of combination for years. of last events

will to continuing continue invest – we’re that. We aircraft do The aircraft. to in is the just

go continue it can the foreseeable for to future. it So –

years XX life left the this CRJXXX, that on of average? aircraft are in guessing they is like I’m – If the

in and fleet could airplane it’s look definitely good to will fleet it. We plans, front immediately there the another the going us. of in and scope But don’t a years. right continue eight nice itself, think we sure. still go a our see for that now, away has seven, anything The future. for it, It of our airplane, in invest that – It out we’ll see for and like we in what monitor run going can in will still run front

Yes, Savi. Chip. is This

if we flying we’re Just certain has didn’t to extent, be CRJXXXs said, know this Wade add to I a think, to long. going to what

provide continue the and we the being – operate to and service system work continue this able our and our that the is that we’re certainly, this Wade economics like while, can with, scope them the But that good. lot XXXX, in the we a engineers going when do demand it for way started great customers. all works to the demand quite for we folks them think, to bought said, is we But with to thing, extremely product and given along didn’t product buying in were. to And keep the we’re world people this I monitor know back willing to things. to the and of a

sense. And kind color I of focusing but is on the this you’d That on make segment a provide might you’re some the what can well. smaller I your on since leasing realize of own that I business. you add, wonder understand I you’re and kind if the seeing equipment some if it’s of side, know

and biggest your kind Just years? side next outlook kind three like to yield on the two generally business is driver? Is it of that what that demand and of for

Well, done we’ve of this kind a to where I the Savi, set different financing past. aircraft what think to this approach up started we’ve in what compared was

and transformed able this, Bombardier we the through some extra a that we the go-forward business where that the be a basis, and sale been operator about evaluate through of assets to to monetize of ended model on did business leasing. our if we’re we’ve something Express there’s product. said And we we’ve as lot our largest candidly up things model with of As assets

We’re becoming good as the and aerospace well, biggest of in now Embraer the capital. have one we

us we back flexibility go able shareholders it and and of a and marketplace, to love good care returning gives good people, some have with flexibility taking return and have our to forth within our this. being the the We relative to credibility that

Again said going our this we’ve within platforms only operate. existing leasing that that model can be always is to we

being in outside ways our and go amount two other largest in is of order the to work going But just strategically well to very business regional world not also yet return with that. carrier assets taking pretty our these shareholders that. We’re the do deliver finding a care people of fair good well, for as models of with this a each

way I too? driven years being just aircraft versus demand it for maybe the guess, type another doing Is it ago, it? maybe ask why by now strong five Or to

approach Five five years is really actually we tough to to And decided ExpressJet. started years financing ago when we when in relative change aircraft. ago, some to to make on have assets our decisions

does take and I candidly, even think well to quite all work to decision cost approach return long back competitive this us not this the our What flexibility lease to also, to owning also is – of to we said, our care leases being it like assets our do able in within help over having deliver being the ago, used the also but really people just able didn’t shareholders. and of other I right them place, leverage be partners. and

their to just best of partners set the all huge operator now the model Wade by Delta, can value and as apply providing our unique business our and and being capital, things, to competitive perspective, has of we’re well and relative advantage, with of capital engines announced them more take by we with structures as our needs do we partner’s a multitude a industry. in their need. the and partners Our help have from aircraft with And our in the what that’s to particularly business than

creativity are our seen it getting success than past. the But think, in we And that’s well. on our is bring of job has of our that. partners help to part strategically, our be is, what what capitalize model see help to that kind type has continue business now partners to I relationship why and more that’s their able and to it as And of

have. all I That’s you. Okay. Thank

Bank. from Please go next ahead. Our with comes Linenberg Deutsche question Michael

that answer to this both connect everybody. Is went you CRJXXXs to XXX some question. maybe guess Savi’s question, and Duane’s saying one next question into – to on a Is planning reasonably the could is weren’t answered I you case? I clarify the were guess dots, you I want I Wade. conclude to that way year. reconfigure Chip Hey and you then the that sometime and just that.

No.

No. that. We are not saying

Okay, about you around okay. Because your little improvement, and talked enhancement, color that.

okay. So,

so Okay, that helps that.

that’s there your realize swap for I until have out the you start we that of airplane. order XXXX, XXXX. not just thoughts the to And But not into around large about on jet. first. either thinking airplane. or whether not out with have business, Bombardier that curious maybe regional guess jet But the and that maybe have I’m would rights basically whether the MRJXX, that or And I’m You that space to swap with sense. I make coming the rights MRJXXX, curious

Bombardier folks when we conversations I you that talk significant a number when bandwidth back Yes, within tell question. and the rights, size little anything the happening certainly Mitsubishi are just no existing that Mitsubishi Bombardier tilt fleet. we’ve There’s to because that just question and very swap with a probably about Michael. candidly, that the negotiable. having strong Great candidly the the you platform. question quite is entire I’d of we’re a you from bit, are, And relative have elements got and can Bombardier, of

done Very on, say, the candid But because our be by that the parties engagement, this it going forward with of to having conversations clarity work, but clearly it else just what the good there key elements model of So the the and is something and we’re generally. direction good our overall very very of going needs some going business if to doesn’t is the well. I’d good end, future. might similar, that be in very volume are time with to and what not? be even of we’re will work Well, better or not

just And one then Okay, one really – great. great. And quick that’s just last, one.

a turn at compare you’re seeing now, what’s to are holding doing Are over should you sense how year’s You I losing? running better? availability, I’m your just XX% what mentioned you. that of – – pilot getting you to though? last above more than does Thank levels. point? people right are What that actually So turnover? SkyWest on many this that how leaving you’re say pilots, above

it’s our always to reasons. we Yes, for several very of sure pilots and part strategy much a complement have so, healthy make of

about good talk of to a reliability. us that a operational operational they and It’s the families deserve, extremely of have heard have lot they and also that to everything to reliability. that pilots is we for You’ve make lot It’s relative pilots get the off livelihood with good of get all is believe to pilot, they time strategic our incredibly we good. important, in do so that analysis sure hiring

a We’re where spring in now, attrition of as next the pilots and filling year we’re continue to going is build late classes we along. into position

it. So we monitor

more how place our comfortable today. with and position, more that visibility with we’re comfortable We’re where takes getting at and are

Chip. Thanks, Thanks Great. everyone.

Thank you.

Our with next question ahead. comes go from Goldman Catherine O’Brien Please Sachs.

Hi, Thanks Hey the everyone. time. good guys. for afternoon

several thing the I that – investment this aircraft setup been worked up time, Mike investments, are These the for one? contract? potential on so have it’s Or basically these for they aircraft I within there. are those requested on being I was setting less question that for the currently – a are contract ask million just extensions. But more current on Or tell to another contract? their they years made way, some next quite the on that same $XX the so guess can CRJXXX with thinking I So investments for maybe

Wade. is This

is – also it’s of answer more a combination of Some a of them airplanes A four, some It’s lot of both, five shorter three, for are actually question. that’s right? great than years, expiration. contracts under time, have the long periods honestly. these So

the the they’re believe, under contracts our will short-term that we’re demand or and to going make whether partners. be at going long-term fleet they’re the whether of the the seeing to we investment from want because in fleet, we contracts, ultimately, to end So to we need day, aircraft, they’re major under we in a – the of know the fleet, be long-term

the a the in the or making under so it we’re And both there time. a investments believe – the are we’re fleet we for short if investment long airplanes be that because in making will term, term long

that ask without quick ever decision – the you just to ever the make follow-up do first SkyWest Maybe before I would an discussion one. with side interior of Understood. modification to a major another having Would partner?

very interiors question. closely At partners the the with of on our That’s the day, very, their great aircraft. of major end work a we

we go out and without with partners. And the and there do so would not our blessing something working major

We’re brand just their customers, partners. and and and our seamless we we’re make with carrying sure their lockstep in major to want

margins. or adding as advance, I based only SkyWest down been gave you flat prorate question. that and in driven SkyWest sense. by last about by maybe of I And make some then a I kind also the slightly the flying realize changes less-profitable apologize looks in in of into release, operating back in of I margins I impressive couple the year, long-winded of And Totally a figures been last think or if like years. But on from we that’s cost your profitable flying. of quarter combination growth could new guess, this margin revenue unprofitable That out that driven margins are first know flying the getting of some year-over-year.

if like guess of Is unprofitable much. I that what less-profitable getting unprofitable flying? was so, margin so of And guess, you majority driven we year are the so I And reduction inning Thank of terms in of of in, right? growth the out by your this flying?

Catie. Sure

I as the can. answer me simply as Let question

years hard worked of unprofitable of that we’ve obviously, eliminate we’ve aeroplanes It’s a a fleet, achieved It’s economics a of end to lot it’s last profitable better things. that. pretty the pockets It’s the flying, combination on we’ve when of elimination mix that different richer we a of mix. I think get of over the a job good improvements of done five and our airplanes. any extensions. It’s

So a really our ongoing our combination is – of profitability profitability it’s all and of things. those

And again, work scope for a going within partners. forward to nice our continue to have existing we opportunity I creatively think

opportunities in incremental story market this going continue these, the leasing I for makes our of and can invest to We of story part forward. drive obviously, have And forward business from here We’ve think, help along share. growth that going profitability growth opportunities, sense take way part some and going long to opportunities where all is term. of the it to we’re be in got

the color. Thanks Great. for

question with next go Helane Our from ahead. comes Cowen. Please Becker

This see additional about years I Hey for Cunningham But to feel opportunities wanted is actually the come. some well have Clearly, growth Helane. if term win? on XXXX. positioned the guys. that coming how you really to near curious there any are for was in there contracted some feel on up business restrictions to just scope, Conor on going know you on in you but you’re

it’s optimistic, Conor, Chip. dialogue close that single I we pretty call that very with think our that – we is Hey, every think would, certainly, a this perspective, Yes. our say outlook I say, partners honestly. our the all time. I we from No, have

of while. of initiatives like in, a ideas no had just in overall where we’ve that to ways. is can feel fill Ours responding one we not matter RFPs engage been There’s with a and that but a this we for heavily multitude strategic that their we question

else have relative We’re we anybody do. the And pretty we straight to what you basics to we say do and if to tackle, typically the commit we’re than will. down know better going to centerline block and do

have four, on much us been. we’ve have been over And ever optimistic about the tell that to past years as our continues five that, as you we future I that can working model

partners way deliver there’s But been our the we view with be dialogue of the overall we’ve delivering scope thing. continue if have the type So things. our is right restrictions that’s to kind on and continue know I have, we the we to optimistic. and of those way what

aircraft Okay. lease. off And you that the on just then purchased

active pretty and couple been that have guys last quarters terms You in in general. of the in just of doing aircraft buying

number I if curious Just this many unencumbered? going in new couple on might of now, right are if last not now? aircraft, forward? a is equity of years, over have unencumbered stuff, so lot of that you how a just EXXX right your yet you realize maybe And but lot of curious a those of target an have

Conor. Yes,

our financing, of owned some balance leasing, our a fleet on we’ve If kind. got it are assets. significant no parts debt by look of sheet of has roughly fleet no a no But our our you any other at fleet, unencumbered of partners. on There’s our chunk that third

I especially just then incredibly I regional factor are side, on just there’s you was flight. know Thanks any I may like on question well XX be time. to the guys – have running going adjusted Okay, but raw a operation. flights completion I if almost on that weird slightly late. thoughts on really a basis, you curious guys on as on XXX% additional an great XX% it’s the you run a expensive always question any of just and XXX%, quick if paid mean, on And near this complete near assumption but curious to for that. was get that know thoughts. a

Conor. you, Thank

I think right. you’re

I expensive but is tremendous think it investment an yielded return. it’s that

thing able – a to who goes are, that within people, product be culture, it’s to thing competitive we and cultural we whole we that’s to perfect. to want is want And compared the our deliver DNA our within to competition that we organization. deep Our be just want not so a our a

return but strong do, try life continue reliable when for so to what an you efficiency as assets and us. we is know investment We not know members cheap. we a it’s we better deploy certainly be of to the for of operation, is levels and try it a that to to do crew find have as and everybody best strategically, our it, yield for You we

Great, thank you.

next from go Please Stifel. ahead. question Bert Subin Our with comes

afternoon. for Good time. Thanks guys. the Hey,

Bert. Hey,

a Just wondering talked about CRJ think the bit So investments. you little about you’ve do how prorate?

larger wind business with this this does exist can when or regional jets retirements happen? to start program just down wondering, Just those

Hey, Bert, this is Wade.

very to fulfilling So sure all are and prorate opportunities opportunities there, to the from there’s prorate our want now. it’s prorate prorate continue look so many there – then or the and demand, balanced can many around – very the right small There well in – and exist those. our we’ll out are the strong The approach obligations prorate it are opportunities to XX% fleet, good there market. of contract make We if prorate. best that contract right out this of perspective are to we’ll so continue can very, communities keep for between we the in our that now, out opportunities underserved served there not and to somewhere But we’re our be flying.

got Yes. that wondering that’s in I start you road, just towards eight the Does move down just maybe does because CPAs maybe left you – of long that I’m my seven question was now. back to yet? XXXs. guess earlier years just jets XX said a sort that really longer-term. little like more on know I haven’t to to point Or run? the business that

great something say what I fleet deploy I on would when this relative the good I the larger these strong. to wanted on to I Bert, to years for exactly this we or if stuff other markets. can something X majors road don’t be fundamentally, fleet another that It’s demand the question, with very CRJXXXs else, call very, one is that a there. that to happens our down we an Chip. like XX travel – type of think, tell this have that, Yes, small way demand would fair about saying If And is call things the as the is economy or this talked a or met. particularly we doubt demand you, something and or of no particularly some you already a demand of the communities evaluate air like are in amount know

in from demand why investment is – make until foreseeable CRJXXX. investment the we’re to going and in in the we the that’s is good it that’s size the wheelhouse. now, demand strong, continue this why to is This being making the right now But news is Right to future, we’re and fleet, evaluate and created the our today community forward. demand the the as in of going something that’s this

Thanks. that. Appreciate

Just it’s quick guess for follow up. probably Rob. one I

flow of up you end pretty it walk through just material. CPAs Can materializing out? next that sort are year, if become free should no seems cash assuming like plays So what the Thanks. uses top

from is today, is million where is. based we know to going all we’re Bert. Again, see next of line year that you be of the we million. sure, what on it call Yes, to million, CapEx need that we if think would $XXX $XXX scrimmage to roughly this $XXX to We going our said half but audibles

combination should in CapEx, XXXX. of could the So be double continued and cash flow and lower in – EBITDA flow over the powerful what cash generate free we expect it XXXX growth growth to

we new an that upside in come, on sheet we generate potentially. publicly that sure today, want got upside I talked and from have next place great we’ve other the the additional make to of There’s we’ve the we liquidity a if announced flow hell aircraft opportunities. additional a extensions, of year. we’re obviously, nimble think additional based there’s flexibility to So very of fleet should share, market what lot we that opportunities a from There’s cash and about. But what balance sheet, orders We it. keep upside balance a leasing in

Great. Thanks for the time.

Childs back the like would Chip turn over This I to concludes for closing conference remarks. question-and-answer to our session. any

for us call again, Thank the you, joining everyone, today. on

long up we set near months. our you. year get some you about review our ourselves end in the and results to term. have future We Thank of the things that And back and in are excited three for will and we

attending now has Thank conference you The today’s presentation. concluded. for

now may You disconnect.