CHICAGO, Oct 18 (Reuters) - Spirit Airlines ( SAVE )

said on Friday it has reached an agreement with its credit card

processor to extend a debt refinancing deadline by two months

until Dec. 23.

The extension agreement with U.S. Bank National Association

provides some breathing room to Spirit to refinance its $1.1

billion loyalty bonds due to mature next year. The previous

refinancing deadline was Oct. 21.

The Florida-based discount carrier also said it has fully

drawn down its $300 million revolving credit facility and

expects to end this year with over $1 billion in liquidity.

Spirit has been losing money despite strong travel demand.

It has failed to report a profit in the last five out of six

quarters, raising doubts about its ability to manage looming

debt maturities.

Those concerns have hammered its shares, which have slumped

about 91% this year compared with a 31% gain in S&P 500

passenger airlines index.

In a regulatory filing, Spirit said it is still in "active

and constructive discussions" with its bondholders about the

upcoming maturities.

Spirit has been facing an uncertain future after the

collapse of its $3.8 billion merger deal with JetBlue Airways ( JBLU )

. It has warned of a bigger third-quarter loss due to a

tough race for price-sensitive leisure travelers and an

oversupply of airline seats in the domestic market.

It is also among the airlines most heavily affected by

issues with RTX's Pratt & Whitney Geared Turbofan

engines, which have forced it to ground multiple aircraft and

have left the carrier with bloated costs.

It is trying to attract premium travelers to increase its

revenue and doubling down on cost cuts to save cash. It has

downgraded and furloughed pilots, offered voluntary unpaid

leaves to flight attendants, and deferred all aircraft

deliveries from Airbus.