Sun Country Airlines’ net income dropped 23% in its most recent quarter, a bitter end to a profitable year.
Sun Country Airlines’ staffing boosted its performance but contributed to recent income loss
The Minneapolis carrier experienced a fourth-quarter drop in profit, though it had its highest full-year revenue.
The Minnesota Star Tribune
February 1, 2024 at 6:09PM
In the fourth quarter ended Dec. 31, Sun Country reported net income of $5.6 million, a nearly one-quarter decrease from the year-ago period. While the company saw an 8% increase in revenue of $245.5 million overall for the quarter — its highest quarterly total — it said increased salaries, wages, benefits, marketing expenses and higher ground handling expenses ate away at its bottom line.
Diluted earnings per share declined to 10 cents from 12 cents for that period.
The Minneapolis-based airline is number two at Minneapolis-St. Paul International Airport behind dominant Atlanta-based Delta Air Lines, which aims for premium and business travelers as opposed to Sun Country’s budget-conscious and leisure crowd.
Staffing at Sun Country ramped up last year, part of that higher wage cost, but it helped boost the carrier’s recent performance.
“We only canceled one scheduled flight throughout the quarter,” said Jude Bricker, the company’s chief executive, during a fourth-quarter earnings call Thursday with analysts.
Bricker said he expects stable demand early this year but does not predict a repeat of the “spectacular” spring break of last year. Scheduled service capacity should rise to 15% in the first quarter vs. a year ago for the growing carrier.
For the full year, the airline saw net income increase more than 300% to 72.2 million from the previous year. Diluted earnings per share last year also rose to $1.23 from 29 cents a year earlier. Sun Country reported its highest full-year 2023 total revenue of more than $1 billion, up 17% from the previous year, as the highest on record.
The company returned cash to shareholders through share repurchases, which in 2023 totaled 4.2 million shares for $68.6 million.
Sun Country also became the official airline of the University of Minnesota’s athletics teams. Its stock, which fluctuated from $11.96 to $23.80 per share during the past year, rose nearly 8% to $14.66 at market close Thursday.
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