A Las Vegas-based airline is taking a major financial loss from the lack of air travel because of the coronavirus pandemic.
Allegiant Travel Co., the parent company of Allegiant Air, reported in a Securities and Exchange Commission filing Tuesday that it is burning through about $2 million to $2.5 million a day, even as it takes steps to reduce its losses.
Airline revenue for March will be about 40 to 45 percent lower than March 2019, the company said.
“Losses will result from the pandemic and our return to profitability will be impacted by the duration of the national emergency and the pace of the recovery for the entire airline industry,” the filing said.
Allegiant said its executives have taken a 50 percent cut in salaries, and it is suspending “nearly all” contractor positions and instituting a hiring freeze for nonessential positions.
The company is also suspending stock buybacks, payment of dividends, nonessential training and travel, and is renegotiating payments and contracts with vendors.
Nearly 700 employees have volunteered for a 60-day leave at half pay, Allegiant said.
Allegiant recently bought the naming rights to the Las Vegas Raiders stadium, which is now known as Allegiant Stadium. It is a budget airline with inexpensive daily flights servicing the country, with many flights in and out of Las Vegas daily.
The company said it applied for payroll support from the U.S. Department of Treasury last week and will continue “pursuing government and other financing alternatives.”
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