Sun Country Airlines said late Tuesday its latest quarterly profit fell after fuel costs nearly doubled, and executives said damage related to Hurricane Ian may dampen demand for travel to Florida this winter.
“We expect the region to fully recover and we’ll be there along the way,” said Jude Bricker, chief executive of the Minneapolis-based airline.
In the third quarter, Sun Country announced that service will begin in February to Destin-Fort Walton Beach and Melbourne, its 11th and 12th nonstops in Florida from MSP.
The company also announced the expansion of service to Orlando from Eau Claire, Green Bay and Madison, Wis., starting in April 2023.
In the third quarter, Sun Country faced higher fuel prices and staff-driven capacity constraints. Hurricane Ian, which made landfall on Sept. 28 near Fort Myers, reduced total revenue by $1 million.
After a summer where airlines were hit by flight cancellations, Bricker noted that Sun Country hasn’t had one in 96 days.
For the quarter ended Sept. 30, Sun Country’s adjusted net income fell 45% to $7.4 million, or 12 cents a share. That compared with $13.5 million, or 22 cents per share, a year earlier.
Revenue was $222 million, up 28% from a year earlier. But operating costs rose 35%, with fuel up 77%.
Meanwhile, the company continues to train pilots to meet growth plans. The company hired 91 pilots in 2022, up 20%.
Sun Country’s board of directors authorized management to repurchase up to $50 million of the company’s stock. The company’s near-term intention is to enter into an accelerated share repurchase agreement of $25 million with its brokerage bank to allow for the rapid retirement of the purchased shares.
Shares of Sun Country were around $16.37 in after-hours trading after closing at $16.28. The company’s stock has ranged from $13.25 to $33.31 over the course of a year.