Allegiant suspends resort construction to cope with virus fallout
(Two Allegiant Air airplanes are seen on the tarmac at McCarran International Airport in Las Vegas on Tuesday, Jan. 14, 2020.)
Allegiant Air鈥檚 parent company is suspending construction of its Florida resort and slashing other costs to cope with the national fallout over the new coronavirus.
Just days after saying construction would not be affected, Las Vegas-based Allegiant Travel Co. on Wednesday unveiled a slate of measures in response to the virus, with Chairman and CEO Maurice 鈥淢aury鈥� Gallagher calling the public health crisis an 鈥渦nprecedented situation鈥� that is 鈥渃hanging daily.鈥�
The deep-discount carrier said it already slashed flying capacity and that more cuts were on the way. It also said it would 鈥渋mmediately cease activity on non-airline projects.鈥�
Allegiant is shelving construction of its $470 million Sunseeker Resort Charlotte Harbor project; tabling the planned renovation of its Florida golf course, Kingsway Country Club; and closing its two arcades 鈥� one in Utah, another in Michigan 鈥� until further notice.
It also put a moratorium on nonessential capital spending, froze hiring for nonessential positions, suspended stock buybacks and dividends, and said 鈥渁venues for additional borrowing will be explored.鈥�
Gallagher and Allegiant President John Redmond do not take a base salary, but other corporate officers will take a 50 percent salary cut, the airline said.
All told, the measures 鈥渃ould defer as much as $300 million鈥� in planned cash spending this year, Chief Financial Officer Greg Anderson said in the release.
Allegiant will 鈥渂ring forward additional measures as needed,鈥� he added.
The carrier 鈥� known for flying from small, underserved cities to warm-weather vacation spots, usually without competition on its routes 鈥� said over the weekend it will for two weeks starting Monday because of the new coronavirus.
It said employees based there will work remotely during the closure, which 鈥渨ill not affect construction鈥� of the .
Allegiant broke ground on Sunseeker a year ago and has said it expects to finish the hotel in the second quarter of 2021.
Contact Eli Segall at esegall@reviewjournal.com or 702-383-0342. Follow on Twitter.