Allegiant Air’s parent company reported a sharp drop in fourth-quarter earnings as the airline marked its 16th straight year of profitability.
Las Vegas-based Allegiant Travel Co. said Wednesday that it earned $41.4 million in net income in the three months ending Dec. 31, down 50.4 percent from the same period in 2017.
Revenue rose 8.7 percent year-over-year to $412.1 million, while operating expenses dipped 1 percent to around $349 million. The profit plunge, however, stemmed from Allegiant’s “provision for income taxes,” or its estimate of income-tax payments.
Allegiant’s provision in the fourth quarter was about $11 million, compared to minus $66.35 million in the same quarter in 2017, the carrier reported Wednesday.
President Donald Trump slashed taxes in December 2017 with the Tax Cuts and Jobs Act, which, among other things, chopped corporate tax rates. Early last year, Allegiant said it received a one-time “tax benefit” of about $74 million in the fourth quarter of 2017.
Led by Chairman and CEO Maurice “Maury” Gallagher, Allegiant is an ultra-low-cost carrier known for flying from small, underserved cities to warm-weather vacation spots, often without competition on its routes.
The company is also developing a 22-acre real estate project in Florida called Sunseeker Resort Charlotte Harbor.
Allegiant indicated Wednesday that it lined up $175 million for Sunseeker from a “well-known institutional asset manager” and that it expects to close on the financing by the end of this quarter.
The airline did not name the asset manager.