Parent of Las Vegas-based Allegiant Air sees big profit drop

Allegiant Air’s parent company on Wednesday reported a sharp drop in quarterly profit and signaled there were no immediate plans to hire a new chief operating officer.

Las Vegas-based Allegiant Travel Co. said it earned $48.5 million in net income for the three months ending June 30, down 20 percent from the same period last year.

It booked $400.6 million in revenue last quarter, up 16 percent from a year earlier, and $315.4 million in expenses, up 31 percent.

The deep-discount carrier, which flies largely from small, underserved cities to warm-weather vacation spots, spent $85.4 million on jet fuel, up 42 percent, and $92.2 million on salaries and benefits, up 34.5 percent.

The results follow an even steeper drop in first-quarter profit as well as turnover in Allegiant’s executive offices. The carrier’s share price, meanwhile, has been sliding this year despite a rising stock market.

Chief Operating Officer Jude Bricker resigned in May. He was hired as chief executive of Sun Country Airlines a few weeks ago.

Also, Ponder Harrison was named chief marketing officer in March but resigned in May, before Bricker left.

Maurice “Maury” Gallagher, chairman and CEO of Allegiant Travel, told analysts on a conference call that the airline “had a very good quarter, (we’re) very bullish on where we’re at.”

Allegiant President John Redmond added that Chief Financial Officer D. Scott Sheldon is “functioning” as chief operating officer and has done “a fabulous job.”

Redmond also said the company is not looking to “add to our bench” for at least six months, if not a year, but noted that “we are involved in a search” for a chief marketing officer.

After an analyst asked why “it doesn’t make sense” to search for a new operations boss, Redmond said in part, “We just don’t feel we need to bring someone on.”

A new hire wouldn’t have the opportunity to make changes “in a very quick manner,” something the airline wanted to do, he said.

Allegiant’s stock closed Wednesday trading at $143.20, down $1.25, or 0.87 percent. It’s down 20.6 percent since hitting $180.40 on Jan. 11, while the Dow Jones Industrial Average climbed 8.8 percent in that time.

Despite the drop in second-quarter profit, the slide wasn’t as steep as in the first quarter.

Allegiant booked $41.6 million in net income for the three months ending March 31, down 42 percent from a year earlier.

Contact Eli Segall at esegall@reviewjournal.com or 702-383-0342. Follow @eli_segall on Twitter.