October 23, 2013 / 9:44 PM / 5 years ago

Allegiant posts profit, says shutdown delayed plane deliveries

Oct 23 (Reuters) - Allegiant Travel Co, a low-cost carrier that serves leisure destinations, posted a 1 percent increase in third-quarter profit on Wednesday, aided by higher average fares and lower fuel costs.

The carrier said the two-week U.S. government shutdown would delay the introduction of seven Airbus A320 planes into its fleet because required regulatory work to acquire the aircraft was not able to be completed. With the shutdown now over, Allegiant said it expects to have some of the seven planes in operation before the end of the year.

Allegiant has just over 60 planes in its fleet, including MD-80s made by McDonnell Douglas, which Boeing acquired in 1997, Airbus A319 planes and Boeing 757s.

For the third quarter net income rose to $17.1 million, or 91 cents a share, compared with $16.9 million, or 87 cents a share, a year earlier.

Analysts expected profit of 90 cents a share on average, according to Thomson Reuters I/B/E/S.

Operating expenses rose 6 percent, pressured by costs of about $2 million tied to disruptions in service in wake of the grounding of roughly half the carrier’s planes in September to inspect emergency exit slides. Fuel costs fell nearly 1 percent.

Allegiant said the slide inspections, which were needed to comply with safety guidelines, raised lease-rental, overtime and other costs as it made arrangements to use airplanes of other carriers to ease the disruption from flight cancellations.

Quarterly revenue rose 5.5 percent to $228.9 million. The average fare was $130.99, up about 5 percent.

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