Ben Minicucci
Alaska Airlines President and Chief Executive Officer at Alaska Air Group
Thanks, Emily, and good morning, everyone. Despite a slow start to the year in January and February, March results were very strong. In March, we recorded Air Group's highest ever cash sales, 13% above our prior best month. And for the first time since the pandemic began, March revenues exceeded their 2019 comp. This was driven by strength in both leisure and business demand, with leisure currently more than 100% recovered and business demand now at 70% of 2019. As demand strength has carried into the second quarter and throughout the summer, we issued guidance today indicating that we expect to deliver double-digit percentage increases in both unit revenues and yields versus 2019, and the second quarter guidance reflects line of sight to double-digit pretax margin for the quarter. Given we expect to deliver profits in Q2 and for the remainder of the year, we are reiterating our full-year pretax margin guidance of 6% to 9% for 2022 even with the higher fuel prices we are experiencing today.
To provide more context about our expectations, I want to speak to you today about three topics: what Air Group is doing well; where we are experiencing challenges; and why our team is optimistic about our future. I'll start with what we're doing well. While scaling capacity back rapidly has proved challenging, I'm proud of all the work being done at the company today. Our people have persevered to a lot these past two years. Every day I ask our people to focus on what we can control and where we need to do better. I also wanted to say thank you to every one of our employees, from leaders to our frontline. It is because of their hard work that Alaska was recognized as the 2022 Airline of the Year by Air Transport World. It's an incredible affirmation of the hard work and results this team has produced in a very challenging environment.
We are also progressing on many aspects of our long-term strategy extremely well, including our oneworld and West Coast international alliance partnerships that continue to strengthen and provide more value to our guests and to our results; our new long-term, materially-enhanced cobrand agreement with our partner Bank of America; being recognized as one of the 100 Most Influential Companies by Time magazine for our climate efforts, underscored by our commitment to net-zero by 2040; returning our balance sheet to within our target leverage range and continuing to post financial results that we believe will lead the industry this year; and as we discussed extensively at Investor Day in late March, positioning Alaska to outperform the industry over the next several years given our cost profile and tangible commercial roadmap to grow revenue by $400 million.
Moving on to where we are experiencing challenges. We have faced more operational disruptions than is acceptable as we scale our business back with the primary issue being staffing levels. We have been successful attracting new people to Alaska. We have hired 2,600 employees to date in 2022 with many of our work groups progressing as we expected against staffing plans. However, throughput in our pilot training department fell short of our plan at the end of the quarter, and our teams are now working to accelerate throughput to get us back on track for the year. For this reason, coupled with our commitment to accelerate the exit of the Airbus 320 fleet plus persistent high oil prices, we have reduced our planned capacity growth by a modest amount in the short term and now expect full-year capacity to be flat to down 3% versus 2019.
Alaska, at its core, is a company that is rooted in operational excellence and the productive and efficient use of our resources. Returning to our historic levels of excellence in these areas is the primary focus of our teams going forward. Despite these challenges, I have full confidence that we have a phenomenal future ahead of us because of our people, our culture, and our business model. The key elements are now in place to build a solid foundation to profitable growth. We have deepened our expansive network and global connections from the West Coast. We've reshaped our network over the past few years, seizing profitable flying opportunities as the pandemic shifted the competitive landscape. We are deepening the spokes of our network with efficient, low-risk growth primarily in existing markets. And we continue to build our global presence via oneworld benefiting from international recovery as our global partners launch new nonstop flights and restart service.
We have accelerated our move to single fleet to drive cost savings and operational efficiency. This week we welcomed our 20th MAX aircraft into the fleet. Last month we announced plans to retire our Q400 aircraft and move our regional operation to a single fleet of modern E175 regional jets. The economics are clear and compelling, and executing the strategy as quickly as possible is a top priority. We're leveraging our compelling product, brand, and powerful loyalty program to strengthen our performance. Our renewed credit card agreement with Bank of America expands the value of our program and speaks to the incredible partnership we have and the potential to grow the program further.
Finally, we're delivering on our resilient business model, supported by our competitive advantages, including a low cost, high-productivity mindset, operational excellence, and remarkable service and culture of care. We have a track record of delivering industry-leading pretax margins. On top of this, we have restored our balance sheet to pre-pandemic strength, and continue to focus on our commitment to sustainability. Together, our business model and the initiatives we have undertaken will enhance our ability to produce superior results even in volatile times. As we navigate the remainder of the year, I've asked my team to prioritize three critical work streams. First, to pursue our transition to a single mainline fleet by no later than early 2023. We know and understand the benefits this brings for our company, and the faster we get there, the better; second, to deliver on the $400 million in commercial initiatives we outlined at Investor Day; and third, to return Air Group to operational excellence for our people and guests.
Air Group has done well over 90 years because we are committed to learning from and adapting to our ever-changing environment. It is no small feat that we grew our airline 32% over the same period in 2021, and we have the ability to deliver future growth plans with our commitment to excellence. We will adjust our plans where needed to ensure safety, quality, and our long-term success, while also meeting our financial commitments in the near term, including our 6% to 9% pretax margin this year. I'm very excited for the bright future we have ahead of us.
And with that, I'll turn it over to Andrew.