23 July 2008

An Island of Black in a Sea of Red Ink - Allegiant

NOTE TO READERS - please read all of this post.

Allegiant announced profits today. A stellar achievement it would seem in the labours of all the other Hercules wannabes.

There is clearly something that they are doing right that the Network Legacy Carriers are not. T2 and Flight are working on a Low Cost Carrier study and our analysis seems to bear out some interesting truths as to why the legacy carrier model is broken. Please ping me directly if you are interested in getting early preview access.

In the mean time - big airlines - read this and weep.

Allegiant bucks trend, remains profitable
Leisure carrier Allegiant Airlines posted a second-quarter profit of $2.6 million (13 cents per share). The Lansing State Journal says that's "down sharply from a profit of $10 million, or 50 cents per share," from the same period a year ago. Still, that result allowed Allegiant to hold on to its status as one of the few U.S. carriers to turn a profit during the current industry downturn. "We had very good results during our second quarter. In spite of exceptional headwinds from fuel, we are yet again one of the few companies in our space who were profitable," Allegiant CEO Maurice Gallagher Jr. says in a statement (PDF file).

And just a little postscript. Allegiant does this with Fuel inefficient planes such as the MD80s of mixed heritage that makes up their fleet.

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