Alaska Airlines doesn’t report earnings for a couple more weeks, but in a Securities and Exchange Commission filing Thursday it gave investors a quick good news-bad news heads up.
The good news is that it’s getting a nice $160 million check from Boeing over January’s 737 Max 9 door plug blowout. Planes had to be grounded and Alaska Airlines, which just last year phased out its Airbus fleet to go all-in on the 737 Max planes, was forced to ground a bunch of them while it waited to figure out if they were safe enough to fly.
“As a result of the Flight 1282 accident and the Boeing 737-9 MAX grounding, we lost approximately $160 million in Q1 pretax profit, primarily comprising lost revenues, costs due to irregular operations, and costs to restore our fleet to operating service,” the carrier said in the filing. “We have received initial compensation from Boeing to address the financial damages incurred as a result of Flight 1282 and the 737-9 MAX groundings.” The company also said that it would be getting more money from Boeing, though it did not disclose how much and under what terms.
The bad news is that Alaska Airlines is expecting its losses for the quarter to double, from a negative 55 cents a share to as much as -$1.15 a share. At an investor conference last month, CEO Ben Minicucci said that it took the company a month to get its planes back in the air, which hurt its efforts to turn around what he said is typically the company’s weakest quarter.
“I’m really pleased at Q1, and when we looked at it in December, the revenue trends were strong,” he said at the conference. “Of course, then Flight 1282 happened.”
Alaska Airlines stock was about 5% higher in early Thursday trading.