Spirit Airlines (SAVE) experienced a dramatic stock surge of nearly 40% in premarket trading on Monday after announcing it had extended its debt refinancing deadline with Visa and Mastercard. Initially set for September and extended to October, the deadline has now been pushed to December 23. Spirit confirmed that it remains in discussions with holders of its senior secured notes due in 2025 and convertible senior notes maturing in 2026.
The discount carrier also revealed it had fully drawn down a $300 million revolving credit line and expects to end 2024 with about $1 billion in liquidity, providing a much-needed financial buffer amid ongoing operational challenges.
Despite Monday’s rally, Spirit’s stock has dropped almost 90% year-to-date, following a tumultuous period marked by the collapse of its merger with JetBlue Airways, delays in aircraft deliveries, pilot furloughs, and concerns over reduced revenue. Additionally, speculation of a potential bankruptcy has weighed heavily on investor sentiment throughout the year.
The company’s aggressive cost-cutting measures and strategic refinancing efforts signal attempts to stabilize its financial outlook, but it faces significant hurdles as it navigates legal and operational challenges.
The discount carrier also revealed it had fully drawn down a $300 million revolving credit line and expects to end 2024 with about $1 billion in liquidity, providing a much-needed financial buffer amid ongoing operational challenges.
Despite Monday’s rally, Spirit’s stock has dropped almost 90% year-to-date, following a tumultuous period marked by the collapse of its merger with JetBlue Airways, delays in aircraft deliveries, pilot furloughs, and concerns over reduced revenue. Additionally, speculation of a potential bankruptcy has weighed heavily on investor sentiment throughout the year.
The company’s aggressive cost-cutting measures and strategic refinancing efforts signal attempts to stabilize its financial outlook, but it faces significant hurdles as it navigates legal and operational challenges.