unaligned

JetBlue Airways Corp. is in discussions with lenders to sell $1.5b of high-yield bonds that would yield about 9.5% to 10%, according to people with knowledge of the matter.The airline is also considering a $1.25b leveraged loan with a margin of 5 to 5.5 percentage points over the Secured Overnight Financing Rate, the people said, who asked not to be named discussing a private transaction. Demand has already been strong for the bond, with orders exceeding $1.5b during premarketing, the people said. The debt package could launch as soon as Aug. 12, though discussions are ongoing and details could change, they added. JetBlue has been working with banks including Barclays Plc and Goldman Sachs Group Inc. on a potential $2.75b bond-and-loan offering backed by the company’s loyalty program, Bloomberg News reported on Tuesday. Proceeds would refinance JetBlue debt. Representatives for JetBlue and Goldman Sachs declined to comment. A representative for Barclays did not respond to requests for comment. Global market turmoil in recent days threatened to end a summer debt boom which helped some of the riskiest US companies cut borrowing costs. Four leveraged loan deals were pulled from syndication this week. But markets have been reopening, creating a more-positive tone for JetBlue. Multiple leveraged loans and high-yield bonds have launched since Tuesday, and investment-grade note issuance hit a 2024 high on Wednesday.<br/>

Frontier Group, the parent of budget carrier Frontier Airlines, beat Wall Street estimates for second-quarter profit on Thursday, and said it will defer taking deliveries of 54 Airbus jets. Airlines in the U.S. are experiencing a summer travel boom and expect to ferry 271m passengers during the season, a 6.3% increase over last year, according to Airlines for America, a group representing major carriers. However, carriers have increased seats in the domestic market in excess of demand, pressuring airfares at the price-sensitive end of the market. Frontier's profit beat was facilitated by tighter cost initiatives which included simplifying its network. It also benefited from its sale and leaseback deals in the quarter. The carrier said on Thursday it was deferring deliveries of 54 Airbus jets to between 2029 to 2031. Frontier previously expected to get the deliveries for the jets from 2025 to 2028. Airlines operating certain Airbus A320neo jets have also been impacted by troubles with Pratt & Whitney's Geared Turbofan (GTF) engines, which have forced them to take a number of its aircraft out of service. Last month JetBlue also said that it would defer deliveries of 44 Airbus airplanes to 2030 and beyond as part of its efforts to drive up earnings. On an adjusted basis, Frontier earned 14 cents per share in the second quarter ended June 30, compared with analyst estimates of 12 cents per share, according to LSEG data.<br/>

Experts say airfares may go up in the immediate aftermath of a hailstorm that tore through Calgary on Monday evening, damaging planes at WestJet and Flair Airlines and upending travel plans for thousands of passengers. Hailstones as big as golf balls pummelled the airport tarmac, forcing both airlines to ground 10 per cent of their fleets for repairs and inspections. WestJet said it cancelled 248 flights between Monday and Wednesday, and will have to cut trips across its network for the “foreseeable future.” The Calgary-based carrier cancelled 106 more trips on Thursday and Friday, according to tracking service FlightAware. Flair has also had to trim its schedule, while Air Canada saw a smattering of planes affected. A significant scale-back will likely boost demand at other airlines and push up ticket prices during the peak summer travel season, said Barry Prentice, who heads the University of Manitoba’s transport institute. “This is going to have a real impact on a lot of people who are waiting for flights. You can’t take 10 per cent out of the supply of the second-largest airline in the country and not have impacts,” he said. Longer term, more violent and volatile weather patterns could boost carrier costs such as maintenance and insurance, an expense that will likely trickle down to travellers.<br/>

Ryanair Holdings Plc is embarking on a fresh E800m ($873m) stock buyback as the airline benefits from a stronger cash position amid robust travel demand and aircraft delivery delays that have allowed it to conserve funds. The Irish discount carrier said it now expects to complete its current E700m share buyback by the end of this month, according to a regulatory filing. Ryanair will ask shareholders at its next annual general meeting in September to back an increase in the buyback size to as much as 15% of issued share capital, from previously 10%, it said. Ryanair is heading into a two-year period without new aircraft deliveries, meaning it will have more financial resources at its disposal. “This creates the capacity to extend shareholder returns,” the airline said, which estimated that it has handed out about E8b, including dividends, in the last 15 years. Ryanair is turning the delivery delays of Boeing aircraft into a windfall for shareholders. The company has long lamented the shortfall with new aircraft as its US supplier struggles with output. Boeing’s woes were further exacerbated this year with an additional slowdown in production as the planemaker seeks to improve manufacturing quality. The airline said in November that it would pay out a dividend of E400m, with plans to hand over about a quarter of annual profit to shareholders. Still, the company has lost some momentum in recent months as passengers curtail their travel budgets, and Ryanair said last month that fares in the crucial summer travel period will be “materially lower.”<br/>

Aer Lingus has confirmed plans to close its cargo facility at Shannon Airport before the end of the year. The carrier, part of the International Airlines Group (IAG), has said a review of its operation in Shannon has been completed with a decision made to close the facility by the end of 2024. The airline also stated that significant capital investment is required at their cargo building in Shannon but the level of activity at the airport would not support this. Aer Lingus confirmed that IAG Cargo will commence consultation with impacted staff in the coming weeks. In a statement, Aer Lingus said: “IAG Cargo has completed a review of its operation at Shannon Airport and has taken a decision to close the facility by the end of 2024. This is because the building requires significant capital investment that is not supported by the level of cargo activity at Shannon Airport. The company will now enter a consultation process with staff representatives to explore the options. Every effort was made in the last few years to secure additional cargo business for the Shannon facility both locally and by diverting cargo from other areas, but regretfully it was concluded that the cargo operation for Ireland could no longer support a dedicated presence in Shannon, particularly in light of the fact that over 95% of all Shannon cargo travels by road to fly in or out of Dublin."<br/>

Etihad Airways reported a record profit in the first half of the year, driven by robust demand for travel and cargo revenue as the Abu Dhabi-based carrier prepares for a possible initial public offering (IPO). The national airline posted net profit after tax of $232m (Dhs851m) in the six months ended June, up 48 per cent compared to $157m a year earlier, it said in a statement Thursday. Etihad carried 8.7m passengers in the January-June period, a 38 per cent increase compared to the same period a year ago. Its passenger traffic in H1 is approximately three times higher than IATA’s average growth rate of 13% for Middle Eastern carriers, the statement added. “Etihad continues to play a pivotal role in advancing Abu Dhabi’s tourism and economic development. Our strategic growth and network expansion not only bolster the connectivity of our capital but also significantly contribute to the prosperity of the UAE’s economy,” said Mohammed Ali Al Shorafa, chairman of Etihad Aviation Group. During this time, Etihad’s passenger revenue surged by 24% year-on-year, underscoring strong demand for travel due to network expansion and increased flight frequencies.<br/>

Vietnamese budget carrier VietJet said on Thursday it will take delivery of up to 10 Airbus jets this year, at a time when local airlines are facing a shortage of aircraft due to engine recalls by manufacturers and high leasing prices. The new jets, which are mostly the A321neo ACF (Airbus Cabin Flex) model, are expected to be delivered from this month, VietJet said in a statement. The company has ordered 206 planes from Airbus and operates a fleet of more than 100 aircraft, it added. Last month, it signed a contract with Airbus to buy 20 A330neo wide-body aircraft in a deal valued at $7.4b based on the manufacturer's list price.<br/>