Investing.com -- Shares in Spirit Airlines Inc (NASDAQ:SAVE) plunged more than 5% in after-hours trading after the Florida-based, low-cost airlines' carrier offered a subdued forward outlook for the remainder of 2015 on Monday.
Last month, the company said its June earnings were negatively impacted by numerous flight cancellations brought about by threatening storms. Adverse weather throughout the Midwest, followed by the ramifications of Tropical Storm Bill led to the cancellation of 500 flights, as well as a number of other delays, the company said. Spirit estimates that the high frequency of delays and cancellations over the month contributed to a $20 million negative impact on operating income, denting revenues by $5 million and increasing costs by $15 million.
"Due to the sheer volume of flights affected, we were unable to flex up our staffing levels enough to mitigate the impact of crews being displaced or timing out, which lengthened the span of the irregular operation and the time it took to restore our system to normal," Spirt Airlines said in an SEC 8-K filing. "In our high utilization, low frequency, point-to-point network, severe irregular operations typically create a unique set of challenges; however, we believe the unusual number and location of storms in June exacerbated the operational difficulty and made this event unlike others."
In June, the company said the U.S. domestic pricing environment softened due to competitor pricing level, a move which further tamped down on its earnings. As a result, Spirt is lowering its forward guidance for the remainder of the year. Spirit is revising its operating margin to 22-25% for the third quarter and to 20-23% for the final quarter of the year. The low-cost carrier is also lowering its cost per available seat mile, a widely cited industry metric, for the rest of the year.
Shares in Spirit Airlines fell 3.48 or 5.48% to 60.06 in after-hours trading.
Spirit will release its earnings for its second quarter later this month.