Earlier this week, Sun Country Airlines Holdings, the parent company of Minneapolis-based Sun Country Airlines, published its financial results for the fourth quarter of 2022, along with the financial results for the entire year. Sun Country Airlines finished with a total operating revenue of $227.2 million in the fourth quarter.
A strong quarter to finish 2022
Sun Country Airlines ended 2022 with a 31.6% increase in total operating revenue compared to the fourth quarter of 2021, where the total operating revenue was $172.6 million. This includes a 48% increase in operating income, going from $10.2 million in the fourth quarter of 2021 to $15.1 million in the fourth quarter of 2022. This quarterly increase over the course of the last year shows Sun Country Airlines continuously improving despite the other airlines in the industry not seeing large jumps.
The company also capitalized on a large net income increase in the fourth quarter. Sun Country Airlines recognized a $7.3 million net income for the fourth quarter of 2022. This is a considerable improvement from the fourth quarter of 2021, where the company posted a $1.1 million loss.
Moving forward from 2021In the financial reports, Sun Country Airlines reported a total operating revenue of $894.4 million in the entire year of 2022. This is nearly a 44% increase from 2021’s result of $623.0 million and represents a record high for Sun Country Airlines. However, the net income decreased, dropping from $111.9 million in 2021 to $55.7 million at the end of 2022. This represents over a 55% drop in year-over-year net income.
These jumps in operating revenue show a continued increase in demand that led to expansion throughout the company. The increase in demand allowed Sun Country Airlines to continue to grow its fleet and expand its flight network. Dave Davis, President and Chief Financial Officer, said
"We have continued to prudently grow our airline as we have overcome supply chain challenges and the complexities of implementing a new pilot agreement. Our passenger fleet counts increased 16.7% in 2022, and we ended the year with 571 pilots, which is 25% higher than in 2021."
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As the fleet continues to grow after a strong 2022, Sun Country Airlines recently announced new routes being offered beginning in the summer of 2023. The 15 new nonstop routes depart from Minneapolis-St. Paul International Airport (MSP). 12 new destinations are going to be offered that include Colorado Springs, CO, and Kansas City, MO. These new routes are coming off an 11% increase in revenue in the charter segment.
This represents a total revenue of $43.1 million throughout the year. The charter services are typically provided for professional and college sports teams, the US Department of Defense, and other customers.
Additionally, Sun Country Airlines increased operations in its air cargo services. The company began servicing Eau Claire, WI, through an Essential Air Service agreement that was awarded by the Department of Transportation. The existing charter agreement with Caesars Entertainment was increased to utilize a third aircraft. Sun Country Airlines continued to earn revenue flying cargo through the Air Transportation Services Agreement with Amazon. The cargo segment of Sun Country Airlines remained strong through the course of 2022, representing revenue of $24.4 million.
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Looking Ahead
Sun Country Airlines will continue pushing forward after recognizing a strong four quarter. Q4 2022 was a drastic improvement from the same period in 2021. Jude Bricker, Chief Executive Officer of Sun Country Airlines, said,
“We are very optimistic about 2023, as we continue to see strong bookings, unit revenues, and earnings growth heading into Q1.”
The company will look to build on the improvements made in 2022 to 2023.