EX-99.4 5 ex994-alaskahawaiianprofor.htm ALK 3Q24 PRO FORMA Document

Exhibit 99.4
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Unaudited Pro Forma Condensed Combined Financial Information

Unaudited Pro Forma Information

The following presents certain unaudited pro forma condensed combined statements of operations for the quarter-to-date and year-to-date periods ending September 30, 2023 and December 31, 2023, and for the quarter to date period ending September 30, 2024. The pro forma financial information is based upon the combined historical financial statements of Alaska Air Group, Inc., ("Air Group") and Hawaiian Holdings, Inc., (“Hawaiian”), after giving effect to Air Group’s purchase of all the issued and outstanding shares of Hawaiian by means of a merger (the “Merger”). The combined pro forma information includes adjustments in accordance with Article 11 of Regulation S-X to illustrate the effects of the merger as if it had occurred on January 1, 2023, the beginning of the earliest period presented.
Following Air Group's acquisition of Hawaiian on September 18, 2024, 13 days of Hawaiian's results were incorporated into the combined companies financial reporting. Management believes pro forma combined operating results for prior periods are useful for the purpose of comparing our actual or expected future operating results, as it provides a relevant baseline for identifying trends in the overall operating performance of our business. Management also believes the recalculation of certain operating statistics, unit metrics and certain non-GAAP measures on a pro forma basis to be useful in review of operating results.
"Other Adjustments" in the unaudited pro forma combined statements of operations reflect the preliminary allocation of the purchase price to the acquired assets and liabilities based upon estimates of fair values. These adjustments are provisional and subject to further adjustment up to September 18, 2025 as additional information becomes available, additional analyses are performed and as warranted by changes in current conditions and future expectations. Differences between these preliminary estimates and the final acquisition accounting will occur and these differences could have a material impact on the unaudited pro forma condensed combined financial information and the Combined Company’s future results of operations.

The unaudited pro forma condensed combined financial information is presented for informational purposes only. Such information is not necessarily indicative of the operating results or financial position that actually would have been achieved if the Merger had been consummated on the dates indicated or that the Combined Company may achieve in future periods. Specifically, the unaudited pro forma condensed combined financial information does not include any projected synergies expected to be achieved as a result of the Merger or any associated costs that may be incurred to achieve any projected synergies. The unaudited pro forma condensed combined financial information also exclude the costs associated with any integration activities that may result from the Merger.







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ALASKA AIR GROUP
Unaudited Pro Forma Condensed Combined Statement of Operations
Three Months Ended September 30, 2023

As Reported
Pro Forma
(in millions, except statistical data)
Alaska
Hawaiian
Reclassification and Policy AdjustmentsOtherCondensed Combined
Pro Forma
Operating Revenue
Passenger revenue$2,618 $665 $— $— $3,283 
Mileage Plan other revenue159 — 31 — 190 
Cargo and other revenue62 63 (32)— 93 
Total Operating Revenue2,839 728 (1)— 3,566 
Non-fuel operating expense1,934 583 (2)9 (a)2,524 
Fuel Expense694 200 8 — 902 
Total Operating Expenses2,628 783 6 9 3,426 
Operating Income / (Loss)211 (55)(7)(9)140 
Non-operating Income (Expense) (18)(6)6 3 (b)(15)
Income (Loss) Before Income Tax193 (61)(1)(6)125 
Income tax expense / (benefit) 54 (12)— (2)(c)40 
Net Income (Loss)139 (49)(1)(4)85 
RPMs (000,000) "traffic"15,718 4,451 20,169
ASMs (000,000) "capacity"18,582 5,169 23,751
Load Factor84.6 %86.1 %84.9 %
RASM15.28 ¢14.08 ¢15.01 ¢
As ReportedPro Forma
(in millions, except statistical data)
Alaska
Hawaiian
Reclassification and Policy AdjustmentsOtherCondensed Combined
Pro Forma
CASMex Reconciliation
Non-fuel operating expense$1,934 $583 $(2)$9 $2,524 
Less the following components:
Freighter costs12 — — — 12 
Special items - operating156 — — — 156 
Total non-fuel operating expenses, excluding freighter costs and special items$1,766 $583 $(2)$9 $2,356 
CASMex9.50 ¢11.27 ¢9.92 ¢
Adjusted Pretax Income
Income before income tax$193 $(61)$(1)$(6)$125 
Adjusted for:
Mark-to-market fuel hedge adjustment(35)(7)— — (42)
Special items - operating156 — — — 156 
Special items - net non-operating8 (1)— — 7 
Adjusted income before income tax$322 $(69)$(1)$(6)$246 
Pretax margin6.8 %(8.4)%3.5 %
Adjusted pretax margin11.4 %(9.5)%7.0 %
Adjusted Net Income
Net Income (Loss)$139 $(49)$(1)$(4)$85 
Adjusted for:
Mark-to-market fuel hedge adjustments(35)(7)— — (42)
Special items - operating156 — — — 156 
Special items - net non-operating8 (1)— — 7 
Income tax effect of reconciling items above(31)2 — — (29)
Adjusted Net Income (Loss)$237 $(55)$(1)$(4)$177 
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ALASKA AIR GROUP
Unaudited Pro Forma Condensed Combined Statement of Operations
Three Months Ended December 31, 2023

As Reported
Pro Forma
(in millions, except statistical data)
Alaska
Hawaiian
Reclassification and Policy AdjustmentsOtherCondensed Combined
Pro Forma
Operating Revenue
Passenger revenue$2,326 $602 $— $— $2,928 
Mileage Plan other revenue165 — 31 — $196 
Cargo and other revenue62 67 (32)— $97 
Total Operating Revenue2,553 669 (1)— 3,221 
Non-fuel operating expense1,812 579 (13)9 (a)2,387 
Fuel Expense709 202 8 — 919 
Total Operating Expenses2,521 781 (5)9 3,306 
Operating Income / (Loss)
32 (112)4 (9)(85)
Non-operating Income (Expense)
(28)(15)6 3 (b)(34)
Income (Loss) Before Income Tax4 (127)10 (6)(119)
Income tax expense / (benefit)6 (26)— (2)(c)(22)
Net Income (Loss)(2)(101)10 (4)(97)
RPMs (000,000) "traffic"14,153 4,221 18,374
ASMs (000,000) "capacity"17,077 5,104 22,181
Load Factor82.9 %82.7 %82.8 %
RASM14.95 ¢13.11 ¢14.52 ¢
As Reported
Pro Forma
(in millions, except statistical data)
Alaska
Hawaiian
Reclassification and Policy AdjustmentsOtherCondensed Combined
Pro Forma
CASMex Reconciliation
Non-fuel operating expense$1,812 $579 $(13)$9 $2,387 
Less the following components:
Freighter costs15 — — — 15 
Special items - operating37 (22)— — 15 
Total non-fuel operating expenses, excluding freighter costs and special items
$1,760 $601 $(13)$9 $2,357 
CASMex10.31 ¢11.77 ¢10.63 ¢
Adjusted Pretax Income
Income before income tax$4 $(127)$10 $(6)$(119)
Adjusted for:
Mark-to-market fuel hedge adjustment12 4 — — 16 
Special items - operating37 (22)— — 15 
Special items - net non-operating4 (9)— — (5)
Adjusted income before income tax$57 $(154)$10 $(6)$(93)
Pretax margin0.2 %(19.0)%(3.7)%
Adjusted pretax margin2.2 %(22.9)%(2.8)%
Adjusted Net Income
Net Income (Loss)$(2)$(101)$10 $(4)$(97)
Adjusted for:
Mark-to-market fuel hedge adjustments12 4 — — 16 
Special items - operating37 (22)— — 15 
Special items - net non-operating4 (9)— — (5)
Income tax effect of reconciling items above(13)5 — — (8)
Adjusted Net Income (Loss)$38 $(123)$10 $(4)$(79)
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ALASKA AIR GROUP
Unaudited Pro Forma Condensed Combined Statement of Operations
Twelve Months Ended December 31, 2023
As Reported
Pro Forma
(in millions, except statistical data)
Alaska
Hawaiian
Reclassification and Policy AdjustmentsOtherCondensed Combined
Pro Forma
Operating Revenue
Passenger revenue$9,526 $2,460 $— $— $11,986 
Mileage Plan other revenue648 — 124 — 772 
Cargo and other revenue252 256 (126)— 382 
Total Operating Revenue10,426 2,716 (2)— 13,140 
Non-fuel operating expense7,391 2,244 (20)33 (a)9,648 
Fuel Expense2,641 766 32 — 3,439 
Total Operating Expenses10,032 3,010 12 33 13,087 
Operating Income / (Loss)
394 (294)(14)(33)53 
Non-operating Income (expense) (71)(34)12 4 (b)(89)
Income (Loss) Before Income Tax323 (328)(2)(29)(36)
Income tax expense / (benefit)
88 (67)— (7)(c)14 
Net Income (Loss)235 (261)(2)(22)(50)
RPMs (000,000) "traffic"57,362 16,865 74,227
ASMs (000,000) "capacity"68,524 20,204 88,728
Load Factor83.7 %83.5 %83.7 %
RASM15.22 ¢13.44 ¢14.81 ¢
As Reported
Pro Forma
(in millions, except statistical data)
Alaska
Hawaiian
Reclassification and Policy AdjustmentsOtherCondensed Combined
Pro Forma
CASMex Reconciliation
Non-fuel operating expense$7,391 $2,244 $(20)$33 $9,648 
Less the following components:
Freighter costs53 — — — 53 
Special items - operating443 (38)— — 405 
Total non-fuel operating expenses, excluding freighter costs and special items
$6,895 $2,282 $(20)$33 $9,190 
CASMex10.06 ¢11.29 ¢10.36 ¢
Adjusted Pretax Income
Income before income tax$323 $(328)$(2)$(29)$(36)
Adjusted for:
Mark-to-market fuel hedge adjustment(2)2 — — — 
Special items - operating443 (38)— — 405 
Special items - net non-operating18 (29)— — (11)
Adjusted income before income tax$782 $(393)$(2)$(29)$358 
Pretax margin3.1 %(12.1)%(0.3)%
Adjusted pretax margin7.5 %(14.5)%2.7 %
Adjusted Net Income
Net Income (Loss)$235 $(261)$(2)$(22)$(50)
Adjusted for:
Mark-to-market fuel hedge adjustments(2)2 — — — 
Special items - operating443 (38)— — 405 
Special items - net non-operating18 (29)— — (11)
Income tax effect of reconciling items above(111)12 — — (111)
Adjusted Net Income (Loss)$583 $(314)$(2)$(22)$233 

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ALASKA AIR GROUP
Unaudited Pro Forma Condensed Combined Statement of Operations
Three Months Ended September 30, 2024
As Reported
Pro Forma
(in millions, except statistical data)
Alaska
Hawaiian
Reclassification and Policy AdjustmentsOtherCondensed Combined
Pro Forma
Operating Revenue
Passenger revenue$2,821 $606 $— $— $3,427 
Mileage Plan other revenue171 — 4 — 175 
Cargo and other revenue80 62 (5)— 137 
Total Operating Revenue3,072 668 (1)— 3,739 
Non-fuel operating expense2,107 539 (8)(9)(a)2,629 
Fuel Expense624 153 6 — 783 
Total Operating Expenses2,731 692 (2)(9)3,412 
Operating Income / (Loss)
341 (24)1 9 327 
Non-operating Income (Expense)
(13)(38)17 3 (b)(31)
Income (Loss) Before Income Tax328 (62)18 12 296 
Income tax expense / (benefit)
92 (3)— 3 (c)92 
Net Income (Loss)236 (59)18 9 204 
RPMs (000,000) "traffic"16,970 4,103 21,073
ASMs (000,000) "capacity"19,847 4,760 24,607
Load Factor85.5 %86.2 %85.6 %
RASM15.48 ¢14.03 ¢15.19 ¢
As Reported
Pro Forma
(in millions, except statistical data)
Alaska
Hawaiian
Reclassification and Policy AdjustmentsOtherCondensed Combined
Pro Forma
CASMex Reconciliation
Non-fuel operating expense$2,107 $539 $(8)$(9)$2,629 
Less the following components:
Freighter costs17 — — — 17 
Special items - operating74 3 — — 77 
Total non-fuel operating expenses, excluding freighter costs and special items$2,016 $536 $(8)$(9)$2,535 
CASMex10.16 ¢11.26 ¢10.30 ¢
Adjusted Pretax Income
Income before income tax$328 $(62)$18 $12 $296 
Adjusted for:
Mark-to-market fuel hedge adjustment(4)— — — (4)
Special items - operating74 3 — — 77 
Special items - net non-operating1 — — — 1 
Adjusted income before income tax$399 $(59)$18 $12 $370 
Pretax margin10.7 %(9.3)%7.9 %
Adjusted pretax margin13.0 %(8.8)%9.9 %
Adjusted Net Income
Net Income (Loss)$236 $(59)$18 $9 $204 
Adjusted for:
Mark-to-market fuel hedge adjustments(4)— — — (4)
Special items - operating74 3 — — 77 
Special items - net non-operating1 — — — 1 
Income tax effect of reconciling items above(18)— — — (18)
Adjusted Net Income (Loss)$289 $(56)$18 $9 $260 
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Notes for the Pro Forma Adjustments
(a)Adjustments to non-fuel operating expense includes impacts of purchase accounting and related depreciation and amortization.
(b)To eliminate the historical amortization of debt fees and discount and to record the impact for interest expense related to the fair value adjustment of debt.
(c)To recognize the income tax impacts of other adjustments.



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