Earnings Call Transcript - ULCC Q4 2022

Operator, Operator

Good day, and thank you for standing by. Welcome to the Frontier Group Holdings' Fourth Quarter 2022 Earnings Conference Call. Please be advised that today's conference is recorded. I would now like to hand the conference over to your speaker today, David Erdman, Senior Director, Investor Relations. Please go ahead.

David Erdman, Senior Director, Investor Relations

Thank you, and good afternoon, everyone. Welcome to our fourth quarter 2022 earnings call. Today's speakers will be Barry Biffle, President and CEO; Jimmy Dempsey, EVP and CFO; and Daniel Shurz, Senior Vice President, Commercial. Each will deliver brief prepared remarks, and then we'll get to your questions. First though, let me cover the safe harbor provisions. During this call, we will be making forward-looking statements, which are subject to risks and uncertainties. Actual results may differ materially from those predicted in these forward-looking statements. Additional information concerning risk factors which could cause such differences are outlined in the announcement we published earlier, along with reports we filed with the SEC. We will also be discussing non-GAAP financial measures, which are reconciled to the nearest comparable GAAP measure in the appendix of the earnings announcement. And so with that, I'm going to give the floor to Barry to begin his comments. Barry?

Barry Biffle, President and CEO

Thank you, David, and good afternoon, everyone. Frontier posted strong fourth quarter results, achieving an adjusted pretax margin of 5.7%, our third straight quarterly profit. Results were underpinned by a record ancillary revenue performance along with meaningful improvements in our unit cost and utilization. The strong result was hampered by major disruptions followed by a winter storm early during the busy holiday travel period. However, we were able to minimize the impact through the recoverability of our modular network and the dedication of team Frontier who worked tirelessly to ensure our passengers arrived safely at their destination. I'd like to extend my gratitude and recognize the team's efforts as they overcame treacherous weather conditions with extended shifts and managed customer disruptions to get them to their destination safely. At our Investor Day last November, we highlighted how leisure travel demand has undergone a fundamental shift and how we're uniquely positioned to exploit it. Customers have more flexibility and more propensity to travel than they did pre-pandemic, and compelling evidence points to the resiliency in the leisure travel segment. We expect the benefits from this resilient demand to be amplified by industry capacity constraints predominantly caused by pilot shortages and supply chain bottlenecks. But this creates a significant opportunity for Frontier. Although we're not immune to these issues, our focus on the A321neo, together with our robust pilot recruiting and training platforms, uniquely provides us the foundation to harness the growth opportunity before us. Last year we launched our Cadet and Pilot Programs, and both are driving strong demand in candidates who applied to Frontier. Over 100 pilots have already been accepted into the Cadet Program, and we received nearly 5,000 applications last year through all our hiring channels. In fact, the first cadets from the program will be joining us as first officers in just a few weeks. Although aircraft manufacturers are dealing with supply chain issues, the delays we're experiencing from Airbus are between one to five months. While we're disappointed with these delays, they effectively represent a manageable one quarter shift on average across our order book. Our strategy has been to focus on the areas that we can control. We'll focus on hitting our near-term target of $85 in ancillary revenue per passenger, and we achieved $82 for the fourth quarter, enhancing our confidence that hitting the $85 target in the fourth quarter will happen. Moreover, we lowered our total adjusted CASM, including interest by 8% from the prior quarter and widened our total cost advantage with the industry to an equivalent of over $70 per passenger. Our costs are our competitive edge, and we expect to maintain this advantage for years to come. Put simply, our strong ancillary performance and industry-leading unit costs are the variables that make it possible for us to capitalize on the strong leisure market and stimulate profitable growth for the rest of the decade. All of team Frontier is unified in this pursuit, and it gives me confidence to reaffirm our target of returning the airline to pre-pandemic profit per plane by the second half of 2023 on a run rate basis. With that, I'll hand the call over to Daniel for a commercial update.

Daniel Shurz, Senior Vice President, Commercial

Thank you, Barry, and good afternoon, everyone. Fourth quarter revenue was $906 million, a 38% increase from the 2019 quarter, marking the fourth consecutive quarter in which revenue has grown by double-digits over the respective 2019 quarter. Travel reached capacity at a high level. Total revenue per passenger was $133 supported by impressive performance on the ancillary front, which, as Barry mentioned, reached a record $82 per passenger. Our ancillary performance demonstrates our customers' preference for unbundled products, enabling them to personalize their travel experience, contributing to a more stable and predictable source of revenue. This has affected our ancillary performance that we saw throughout 2022, aiming to achieve our target of $85 per passenger in the fourth quarter of 2023, as well as our long-term target of $100 per passenger by 2026. Aircraft utilization improved by approximately 25 minutes per day over the prior quarter to 11.5 hours, on average, flying to 1,032 miles. With the continued progression in our utilization throughout 2022 towards pre-pandemic levels, we're on track to achieve average daily utilization of over 12 hours and an average flight distance of 1,050 hours during 2023, as set forth at our Investor Day. In the fourth quarter, we opened new markets and added 140 routes, now available. Additionally, during the fourth quarter, we announced a new crew base in May 2023, where we expect to employ 120 pilots from 220 candidates by the end of the first year of operation. We've been the fastest-growing carrier at DFW since 2019. And once we launch our new service, we will be the largest carrier at the airport based on destinations served. Finally, since we launched our GoWild pass in November, we have seen strong demand. This unique product provides travelers with the opportunity for unlimited flights to all of our domestic and international destinations for one low annual price. Just last week, we introduced a second version of the product to travel during the summer months, and we're seeing strong demand since it went on sale. We're encouraged by the increasing engagement this product creates with our brand, both for existing and new customers. That concludes my remarks. I'll now hand over the floor to Jimmy.

Jimmy Dempsey, EVP and CFO

Thank you, Daniel. We generated a pretax margin of 5.5% on a GAAP basis and 5.7% on an adjusted basis during the fourth quarter, above the midpoint of our guidance range despite the impact of the holiday winter storm. Our adjusted pretax margin excludes $2 million in employee retention and termination costs related to the combination with Spirit, the recognition of which is expected in the March 2023 quarter. The sequential margin improvement hampered by storm impact was largely driven by record ancillary revenue and lower fuel cost per day. Adjusted CASM ex-fuel declined sequentially to $0.64, which was 7% lower than the prior quarter, the lowest expense since exiting the pandemic. The decline was driven by higher utilization along with the timing of aircraft deliveries and aircraft returns, partially offset by higher other non-fuel expenses, particularly lease return costs. We ended the year in a strong financial position with $761 million of unrestricted cash and cash equivalents and $332 million net of total debt. Additionally, as previously highlighted, we have the ability, if needed, to access substantial liquidity through our loyalty program and brand-related assets. We had 120 aircraft in our fleet at year-end after taking delivery of 2 A320neo and 3 A321neo aircraft during the quarter. We expect to take delivery of another 6 A321neos in the first quarter of 2023, of which 3 are direct leases. As noted in our earnings release, Airbus' delay in aircraft deliveries has reached between 1 to 5 months for schedules in 2023. Accordingly, 9 A321neo aircraft deliveries previously expected this year will shift into 2024, resulting in about 5% less capacity in 2023 than we expected in November. We therefore expect to encounter slight upward pressure on adjusted CASM ex-fuel in the near term given the unit cost efficiencies unlocked by the A321neo. Accordingly, we anticipate being below $0.06 during the second half of 2023 and largely above for the full year, levels which we believe are materially below the industry average. In recap and guidance, first quarter capacity is anticipated to grow 17% to 19% over the 2022 quarter, while full year 2023 is expected to grow 23% to 28% over the prior year. Fuel costs are expected to be between $3.50 and $3.55 per gallon in the first quarter and $3.05 to $3.15 per gallon for the full year 2023 as of the Brent fuel curve on January 30. Adjusted non-fuel operating expenses in the first quarter are expected to be between $570 million and $595 million and $2.425 billion to $2.525 billion for the full year. Our effective tax rate is expected to be 24% for the entire year. Finally, first quarter adjusted pretax margin is expected to be in the range of minus 2% to minus 6%, largely reflecting elevated fuel prices and seasonal softness. With that, I'll turn the call back to Barry for closing remarks.

Barry Biffle, President and CEO

Thanks, Jimmy. Our objectives for 2023 are clear. All 13,000 members of team Frontier are focused on completing the post-pandemic turnaround. I'm confident we can sustain the momentum from the last three quarters as we execute on widening our total cost advantage while delivering on revenue enhancements, particularly on the ancillary front. Together, these two factors will enable us to return the airline to pre-pandemic profit levels. Thanks again everyone for joining the call today. We're now happy to take your questions.

Operator, Operator

And our first question will come from Stephen Trent from Citi.

Stephen Trent, Analyst

Definitely appreciate the color and everything you mentioned about the cadet program and what have you, and that's great to hear. I was wondering if you wouldn't mind giving us some color on what you're seeing in terms of mechanics and sort of availability of mechanics and if you're seeing any hiccups in terms of engine maintenance throughput issues of any kind?

Barry Biffle, President and CEO

Yes, thanks, Steve. So look, we've been talking about the mechanic shortage for years, and everyone is focused on the pilots, but actually the mechanic shortage is just as problematic. We have seen some of our business partners. As a reminder, the majority of our maintenance on the line is actually provided by business partners, and we have seen some challenges there. In particular, we've seen issues, especially in places where we still have on-call maintenance where we don't do maintenance every day. Sometimes the availability and the speed of their response has deteriorated as a result of their staffing levels. But we are working with them. We've had a lot of talks with them recently. The other thing that's been impacting us, you mentioned the engines, which hasn't been a major issue for us. However, there have been significant challenges with parts overall. We have seen multiple instances over the last several months where we've had aircraft grounded for 5 to 7 days, waiting on parts. So we're experiencing the supply chain issues that many industries are facing, and we are working with all our providers and spending a lot of time on that.

Operator, Operator

Our next question will come from the line of Jamie Baker from JPMorgan.

Jamie Baker, Analyst

So this first question, I wasn't planning to ask until last night. Of your total ancillary take, what percentage comes from the seat assignment fees on reservations with more than one traveler in the PNR?

Daniel Shurz, Senior Vice President, Commercial

Jamie, we don't disclose the breakdown, that's something I don't have a breakdown of. I don't have a breakdown of the exact mix of how many passengers are on the PNR and what's going on, but we're obviously conscious of the things that you've talked about.

Jamie Baker, Analyst

Yes, yes, which is why I'm asking.

Barry Biffle, President and CEO

Well, Jamie, I know why you're asking the question. And first of all, we have, for years, these are the standard practices across the industry. We have shown every option available to a customer before they complete their booking. So everyone knows prices well in advance. If a flight is canceled or significantly delayed, we provide prompt refunds on request. As for families and seating, we actually do that today for free and have high success in actually getting families seated together. There are operational challenges last time, and if the last few seats are sold to a family, it's a little harder. But we do a really good job with that. So, I think there's a lot of confusion about that.

Jamie Baker, Analyst

Well, and I appreciate that, Barry. So let me just ask, and I apologize because I'm going to give away the fact that I don't fly Frontier very often. But if I go to book a flight right now for a party of 5 for travel in June, you're telling me that all 5 of us will be able to make adjacent seat assignments for free?

Barry Biffle, President and CEO

No, no, we will make every effort to get you together, but not the whole family together. We will put an adult with the smaller children.

Jamie Baker, Analyst

Okay, fair enough. I'll experiment with it in a second. I'm sure, the 5% reduction in 2023 capacity, takes some pressure off pilot hiring and I know you made an excellent point at Investor Day emphasizing new crew bases out and back flying as lifestyle benefits. But given the recent wage increases, it looks like you're now bringing up the rear in the industry in terms of pay save, I guess, for maybe Avelo and Breeze. Obviously, this will change with the new pilot contract in 2024. But until then, why shouldn't we assume that the pilot shortage hurts you more than other low-cost airlines in the U.S.?

Barry Biffle, President and CEO

Because it hasn't happened. We have an aggressive hiring program, and we’re not bringing up the rear. I think we’ve gotten the brunt of a lot of this dialog. This is a regional situation, right? We are significantly higher than the regionals, and we are successful in all of our classes, receiving over 10 applications a day of qualified applicants. I think you’re welcome to come out, Jamie. I’ll introduce you to recruiting, and we can show you our classes. It's not the problem that the perception suggests. We’ll have to slow our hiring to accommodate Airbus deliveries.

Operator, Operator

Our next question will come from the line of Helane Becker from Cowen.

Helane Becker, Analyst

I appreciate the color. Just 1 or 2 questions here. I heard what you said about demand in the fourth quarter. But as you're looking at the cadence of demand in the first quarter, can you just talk about what you saw in January and what you're seeing for the rest of this quarter into maybe the second quarter?

Barry Biffle, President and CEO

Yes. So look, we've seen continued robust demand for leisure travel, and it continues to do very well. In fact, I think if you look at our results, you can see in the fourth quarter, I think we were second place in terms of capacity compared to 2019, and we've posted an impressive RASM number against that. In Q1, we continue to see that trend continue. We anticipate being in a really good RASM position even though we are now the largest carrier in terms of size relative to our 2019 size. So even with significant growth in capacity, we are seeing continued strength in leisure demand, especially with the peak periods approaching, and we are expecting sizable growth during the spring break period. We see really robust demand, probably the best we've ever seen, and I expect that, at the current rate, we will have never experienced a spring break as good as this year.

Helane Becker, Analyst

That's very helpful. I recall that in a previous earnings call, you mentioned seeing customers from other carriers switching to us. Are you still noticing that trend among nontraditional Frontier customers?

Barry Biffle, President and CEO

We've seen a significant uptick in customers who did not fly us before. As a growing carrier, you’re always seeing new customers because you’re entering new markets, and so forth. We did see a significant increase in customers over the past year that have not flown us before. We’ve seen a significant uptick in customers purchasing our GoWild pass, who we’ve never seen before at Frontier. It’s hard to specify whether that’s a result of being priced out of legacy carriers or if our brand is getting much stronger. It’s difficult to say, but yes, we continue to see a significant amount of new customers.

Operator, Operator

Our next question will come from the line of Michael Linenberg from Deutsche Bank.

Michael Linenberg, Analyst

I guess to Barry, you're sort of in a unique position in the sense that you're one of the few carriers that operate both the LEAP engine on your A320neo and GTF on your A321neos. I'm curious if you're seeing anything now or is it just because you just started getting the GTFs in your fleet? What are the issues from manufacturer conversations that you think will impact engines going forward?

Barry Biffle, President and CEO

Well, I think that's a question for the engine manufacturers. But yes, we operate both engines. We've been operating the NEO for about 7 years now. We've experienced a lot of initial challenges with the LEAP. There were shroud issues and fuel nozzle problems as encountered with every new technology. We are past most of those issues now, though there may still be a few lingering. We're not as familiar with the GTF, as you pointed out, since we just started operating it in the fourth quarter. So we're still acclimating to it. We haven't had many issues, but a lot of challenges have been with earlier production series parts. Fortunately, we have many of those upgrades installed, but there could still be challenges. The biggest issue is not in reliability but rather the turnaround time on the engines themselves. If you have an engine come off-wing, how long it takes to get that engine overhauled and back to the airlines. We're seeing across the industry longer repair times for components, which affects our operations. We are monitoring this closely and are fortunate to be in a good position compared to others facing more profound challenges.

Michael Linenberg, Analyst

Okay, that's helpful. That kind of reinforces that you never want to be first in line for new technology; it's better to let others experience it first. So that's good. My second question is to Barry and Jimmy regarding your comment about getting back to profitability per aircraft in the second half of 2023. I recall seeing margins around 14% in 2019, which is impressive. Is that what you're referring to? What metric do you hope to hit in the back half of the year?

Jimmy Dempsey, EVP and CFO

Yes, Michael, we have an internal target of getting back to pre-pandemic profit levels. Obviously, the entire industry is trying to do that, but we have a clear path back to pre-pandemic profit per plane on a net income basis, on a run rate basis in the second half of the year. There’s a lot of work to do, moving our unit costs down while widening the cost advantage against the competition, which gives us a real runway to move margins higher. We want to move margins higher, but it's not necessarily a margin race; it's more about profit levels per plane.

Barry Biffle, President and CEO

Yes. So Mike, it’s total dollars of net income per plane. And again, what we did in the fourth quarter illustrates this clearly. If you look sequentially at the last three quarters, you can see the cost trajectory is clear. The ancillary revenue trajectory is also clear. It’s just math. If you look, we’re already back to near pre-pandemic utilization. We might have less than half an hour to go, but we achieved 11.5 hours in the fourth quarter. So all systems go, and we have a clear path. It’s not a maybe, someday; it’s right upon us.

Operator, Operator

Our next question will come from the line of Duane Pfennigwerth from Evercore ISI.

Duane Pfennigwerth, Analyst

Yes, the takedown on full year growth makes sense. More near term, can you just speak to the March quarter? How much of this is just short on deliveries versus increased conservatism in your planning assumptions?

Daniel Shurz, Senior Vice President, Commercial

Duane, it's all delays in aircraft deliveries. We have been working with Airbus for some time on understanding the supply chain issues they have in their business. We were notified recently of significant delays across this year that we were previously unaware of. We are seeing delays between 4 and 6 weeks in aircraft deliveries, which has now extended to 1 to 5 months. The change in capacity is driven by those aircraft delivery delays.

Barry Biffle, President and CEO

Well, in Q1, particularly, this is the first time we've had this many aircraft late, resulting in significant impacts to our schedule.

Duane Pfennigwerth, Analyst

Yes, how many are you short right now? Where do you think you would be and where are you?

Daniel Shurz, Senior Vice President, Commercial

We're seeing aircraft delays extending over time. By the end of the year, given our delivery schedule, we're seeing 9 aircraft moving out of the fourth quarter and into next year. As of today, we've taken 4 lines, expecting to be down to 5 now by the end of this quarter, and it grows to 9 by the end of the year.

Operator, Operator

Our next question will come from the line of Brandon Oglenski from Barclays.

Brandon Oglenski, Analyst

Barry, can you talk about the resiliency of your network and operation? I know you've addressed the pilot issue, but last summer you had constraints across the network, whether it was airport capacity or FAA, ATC capacity. What are you doing to mitigate those challenges this year? What gives you confidence to grow at levels you think you can?

Barry Biffle, President and CEO

Yes, it wasn't the summer; the challenges were observed in spring, particularly significant in Florida. We reoriented our flying to create crew pairings that minimize crossings of busy air traffic centers, allowing us to maintain operational integrity. This helped alleviate disruptions significantly. We also implemented a higher percentage of one-day crew pairings, enhancing our network's resiliency and reliability for the coming summer.

Daniel Shurz, Senior Vice President, Commercial

Moreover, we've built resilience in our operations by making adjustments to our schedule and maintaining larger crew bases. Our tight operational structure ensures we can manage our peaks while minimizing disruptions.

Brandon Oglenski, Analyst

I appreciate the outlook for second half profitability. But Barry, what's the view right now that you can't generate that profitability? Your costs are down, aircraft utilization is increasing. Is it just the outlook for lower fuel prices that makes the difference?

Jimmy Dempsey, EVP and CFO

There is a relationship between fuel prices and revenue that we've seen over the course of the last year. However, we are being clear in our guidance regarding market conditions and costs throughout the year. Recent demand trends indicate strength as we enter the year, so our focus remains on increasing profitability.

Barry Biffle, President and CEO

Specifically regarding your question about why not now, seasonally, Q1 is actually the hardest period for our network, but as costs sequentially decrease and revenues increase with seasonal demand, we will return to pre-pandemic profitability.

Operator, Operator

Our next question comes from the line of Conor Cunningham from Melius Research.

Conor Cunningham, Analyst

Maybe talk a little bit more about just the pilots in general and staffing. Some of the other airlines mentioned a need for 5% more pilots to hit previous production levels. You appear to be overstaffed but I assume that aligns with delays and hopes of future growth. Do you think there’s a structural change in staffing and employee productivity at Frontier?

Barry Biffle, President and CEO

We don't completely understand that. We've heard some of these comments, but we do not have more pilots per plane than we did before or more than we need. There is slightly higher pilot costs due to attrition, leading to increased training costs. However, we are efficient given our modular network. We believe we can sustain staffing levels without the same challenges others are facing.

Conor Cunningham, Analyst

I'll take that. On crew bases, I understand the operational benefits, but shouldn't we assume that opening a crew base leads to structurally higher costs? I mean, the stance you're taking is different compared to pre-pandemic. Just curious how you assess crew bases and their impact on your overall profitability?

Barry Biffle, President and CEO

We spend considerable time figuring this out. As long as we have a minimum amount of sizing, we maintain efficiency. We just opened a base in Phoenix, and we've achieved the necessary scale efficiently. While there may be some inefficiencies related to reserves, we’ve learned to manage that effectively. We are not opening bases unless we believe they fit our efficiency ratio and reliability requirements. We’re optimizing our operations strategically.

Operator, Operator

Our next question will come from the line of Christopher Stathoulopoulos from Susquehanna Investment Group.

Christopher Stathoulopoulos, Analyst

Barry, going back to the outlook for pre-pandemic profitability per plane, what are the assumptions around seasonality and utilization? Does the outlook assume any macro softening, or is it seasonally in line plus or worse? Any color on your demand outlook as we move through the quarters?

Barry Biffle, President and CEO

Yes, we expect to achieve 12 hours of utilization. We were actually at 11.5 in the fourth quarter. We're tracking close to that level now. The significant leverage will come from our A321neo delivery, providing a CASM advantage. We anticipate revenue advantages, even with incremental seating, allowing us to manage any downturn from the broader economy. We can withstand a mild recession, but we are not preparing for a severe downturn in demand.

Christopher Stathoulopoulos, Analyst

Noted, thanks. I think your outlook was modestly above 6 in November, yet today's outlook is less than 6. I understand the slippage here. If there are further delays, what are some levers you could pull since it sounds like there's not much left to squeeze on utilization measure?

Daniel Shurz, Senior Vice President, Commercial

Our trajectory on unit cost is strong. The impact of Airbus delays is a quarter delay for the benefit of the A321neo. However, we are looking to infill capacity via extended leases or distressed aircraft options. We're planning our business on the assumption that today's supply chain challenges may persist, aiming for optimal performance regardless of fluctuations in delivery timings.

Barry Biffle, President and CEO

To clarify on our expectations versus November, we discussed sub-6 before, and we are now focused on low 6 for the year. We still expect to remain below 6 in the second half despite delays.

Operator, Operator

Our next question will come from the line of Savi Syth from Raymond James.

Savi Syth, Analyst

Just a follow-up on the fourth quarter, your cost came in much better than you had thought despite the storms. Curious on what was driving that and what level of conservatism might be in your non-fuel guidance for 2023?

Jimmy Dempsey, EVP and CFO

The big driving force was overcoming fixed overhead costs while moving utilization to 11.5 hours per day, which significantly impacts unit cost metrics. We're providing what we know in our cost outlook for the year where we aim for a sustainable cost advantage versus the industry. Even slight variance still positions us substantially lower than industry averages, positioning us well for growth in both short and medium-term.

Barry Biffle, President and CEO

To clarify, we had a cost advantage of over $70 in 2022, which has expanded to over $80 per passenger in the fourth quarter. This cost advantage gives us confidence that momentum will continue, ultimately leading us to pre-pandemic profit per plane in the second half.

Savi Syth, Analyst

That makes sense. I recall discussing moving from high-touch to self-service at the Investor Day, and how those efforts will yield cost benefits. What updates can you share on the switch in call center practices and customer acceptance?

Barry Biffle, President and CEO

Contrary to some news reports, we’ve seen really good results from our service transition. We've experienced a dramatically improved Net Promoter Score compared to the call center approach. Customers are indeed looking for more efficient methods of interaction, and prompt resolution of issues remains our priority. When compared to competitors, we are successfully reducing wait times, leading to overall customer satisfaction improvements.

Operator, Operator

Our next question will come from the line of Scott Group from Wolfe Research.

Scott Group, Analyst

If I look in the fourth quarter, capacity is up about 15% versus 2019, and CASM ex is up low 20s. If I look at Q1, capacity is now going to be up about 40% versus 2019, but CASM ex is still up low 20s. Why aren't we seeing better unit cost leverage as capacity ramps up meaningfully?

Daniel Shurz, Senior Vice President, Commercial

In Q1, we have lower utilization, which is typical in our business. Just comparing Q4 and Q1 will present challenges for unit metrics. But we haven’t hidden our efficiency initiatives driven by the introduction of the A321neo, which has a larger fleet capacity, helping create efficiency in our business.

Scott Group, Analyst

Okay. Can you discuss your view on full-year revenue growth or RASM? What assumptions are you making here?

Daniel Shurz, Senior Vice President, Commercial

We don’t provide guidance on unit revenue. It’s obviously affected by fluctuations in oil prices throughout the year. We've indicated where we see oil prices right now and are prepared to manage the business against these market forces.

Operator, Operator

I'm not showing any further questions in the queue. I'd like to turn the call back over to the company for any closing remarks.

Barry Biffle, President and CEO

I want to thank everybody for joining our call today. I especially want to thank the Phoenix Airport for hosting our call. We look forward to talking again after the first quarter. That concludes our call. Thanks, everyone.

Operator, Operator

This concludes today's conference call. Thank you for participating. You may now disconnect. Everyone, have a great day.