DALLAS (AP) — Hawaiian Airlines predicts that 2016 profits will beat this year’s earnings assuming that travel demand remains strong and fuel prices stay around current levels.
DALLAS (AP) — Hawaiian Airlines predicts that 2016 profits will beat this year’s earnings assuming that travel demand remains strong and fuel prices stay around current levels.
Hawaiian faces stiff competition on key routes between the islands and the U.S. mainland. The newest rival is Virgin America, which began service between San Francisco and Honolulu last month and starts flying to Kahului on Thursday.
At an investor conference Wednesday in New York, Hawaiian officials said that the number of seats on all airlines between Hawaii and the mainland is still rising but at a much slower pace than in early 2015, which should help boost their company’s margins and profit in 2016.
The company has earned $144.7 million so far in 2015, more than double its profit over the same period in 2014. Analysts surveyed by FactSet expect 2016 net income to be 8 percent higher than 2015 earnings.
West Coast customers are still crucial, but Hawaiian has greatly increased its business of flying Asian tourists to the islands. This week, Hawaiian announced that it will begin daily flights to Tokyo’s Narita airport in July. It already flies daily to nearby Haneda airport.
In an interview, CEO Mark Dunkerley said the Narita route indicates that Hawaiian sees more short-term promise in expanding service to Asia, but he didn’t rule out new routes to the U.S. mainland, where its only Eastern destination is New York.
Hawaiian’s on-time performance has lagged lately — usually first in recent years, it fell to 11th among the largest U.S. airlines in the latest government numbers, which covered September. The airline has blamed construction at Honolulu International Airport, which reduced the number of gates and increased the time planes spend on the ground.
Dunkerley said the congestion eased this fall but “it will become more acute again right at Christmas time.”
Shares of Hawaiian Holdings Inc. rose $1.65, or 4.5 percent, to close at $38.38. They have gained 47 percent this year. The Standard & Poor’s 500 index has gained 1 percent.