Frontier Airlines CEO Barry Biffle and other company representatives rang the opening bell for the Nasdaq stock exchange Thursday morning as the Denver carrier’s long-planned, then stalled out initial public offering finally took flight.
Frontier Group Holdings, Frontier’s parent company, announced late Wednesday that it and some of its existing stockholders would combine to offer 30 million shares of stock for $19 per share on the Nasdaq exchange Thursday. After deducting money going to the other stockholders — who are putting up half the shares — and other expenses, the company projected the offering would inject $266 million into the low-cost airline.
Frontier’s ticker symbol on the Nasdaq Global Select Market is ULCC, according to a news release announcing the IPO.
“It improves our financial stability. It strengthens the balance sheet, and I think it just punctuates and encapsulated all of the success we have had as a company,” Biffle said in an interview with The Denver Post on Wednesday.
Frontier first registered with the Securities and Exchange Commission to go public in spring 2017 but never launched what was expected to be a $700 million stock offering. Then, last July, as the COVID-19 pandemic wreaked havoc on demand for air travel, the company pulled its registration.
But with vaccines rolling out and demand for air travel building again, particularly among Frontier’s bread-and-butter leisure travelers, the company refiled its registration in March. Referencing statistics that showed that many Americans boosted their savings during the pandemic and touting the latest round of federal stimulus checks, Biffle said the airline is planning for business to soar again in the coming months, making it the right time to finally go public.
“You’re in a situation where everybody wants to get back together and travel again and they have the money to do so, so it’s a great time to be a domestic, leisure-focused airline,” Biffle said. “At the beginning of March, we went cash positive again.”
In its SEC filing last month, Frontier officials outlined the damage the pandemic did to the company’s income in 2020. The airline lost $225 million last year after bringing in $1.25 billion in revenue, per that filing. That comes after Frontier made $251 million in 2019 on $2.5 billion in revenue.
Despite the massive swing, Biffle credited his employees for managing through a tough situation and keeping the airline in a position to scoop up passenger traffic as it returned.
Frontier has been the single biggest source of consumer complaints in the state during the pandemic, according to Colorado Attorney General Phil Weiser said, most of those stemming from the company’s voucher policies for flights canceled during the pandemic.
Biffle said he is not worried about consumer sentiment weighing down the airline’s long-awaited IPO. In fact, he feels the airline has a strong brand that resonates with flyers in its home state and beyond and that will attract investors.
“We have the lowest fares. That’s what attracts people and how we treat them keeps them coming back,” Biffle said. “It’s great for Colorado to have another fantastic, public company.”