Spirit Airlines profit drops on higher costs

Spirit Airlines reported its Q4 and full year results showing a fall in net income for both periods. For the fourth quarter to end December 2016, Spirit reported a 34.8% drop in net profit to US$48.5m over the same period in 2015. Operating revenue for the quarter was $578.4m, a rise of 11.3%, while expenses came in at $493m, a 23.4% increase. Spirit said the increase in operating expenses was primarily driven by an increase in flight volume. Aircraft fuel expenses were up 20.3%, due to a 14% increase in fuel consumed. In RPM terms, revenue was up 13.4% on an ASM (available seat miles) capacity increase of 15.4%. The resulting load factor dropped 1.5 percentage points to 81.4%. Costs per available seat mile were up 7%. Spirit took delivery of five Airbus A320neo and one A321ceo aircraft during the fourth quarter. For the full year, Spirit’s net income was $264.9m, a 15% drop on 2015’s total. Revenue was $2.32b, up 8.4% from 2015’s $2.14b, while operating expenses rose 15.1% to $1.88b.<br/>