Copa Holdings Reports Financial Results for the First Quarter of 2024
PANAMA CITY, Panama, May 15, 2024 /PRNewswire/ -- Copa Holdings, S.A. (NYSE: CPA), today announced financial results for the first quarter of 2024 (1Q24). The terms "Copa Holdings" and the "Company" refer to the consolidated entity. The following financial information, unless otherwise indicated, is presented in accordance with International Financial Reporting Standards (IFRS). See the accompanying reconciliation of non-IFRS financial information to IFRS financial information included in the financial tables section of this earnings release. Unless otherwise stated, all comparisons with prior periods refer to the first quarter of 2023 (1Q23).
OPERATING AND FINANCIAL HIGHLIGHTS
- Copa Holdings reported a net profit of US$176.1 million for 1Q24 or US$4.19 per share, a US$18.3 million increase compared to 1Q23 on an adjusted basis. These results include a negative impact of approximately US$44.0 million related to the grounding of 21 of the Company's Boeing 737 MAX 9 aircraft in January and exclude any compensation received from Boeing.
- Copa Holdings reported an operating profit of US$216.0 million and an operating margin of 24.2%, an increase of 11.8% and 1.9 percentage points, respectively, compared to 1Q23.
- Passenger traffic for 1Q24, measured in terms of revenue passenger miles (RPMs), increased by 7.1% compared to 1Q23 while capacity, measured in available seat miles (ASMs), increased by 8.0%. As a result, the load factor for the quarter decreased by 0.7 percentage points to 86.0% compared to 1Q23.
- Total revenues for 1Q24 increased 3.0% to US$893.5 million driven by an increase in passenger traffic. During the quarter, compared to 1Q23, passenger yields decreased by 3.8% to 14.0 cents, and revenue per available seat mile (RASM) decreased by 4.6% to 12.5 cents.
- Operating cost per available seat mile (CASM) decreased by 6.9% from 10.2 cents in 1Q23 to 9.5 cents in 1Q24, mainly driven by a decrease of 13.9% in the price of jet fuel, a decrease in maintenance, materials and repairs costs, and lower sales and distribution costs.
- CASM excluding fuel (Ex-fuel CASM) decreased by 2.0% in the quarter to 6.1 cents, when compared to 1Q23. Excluding the negative impact on costs and capacity of the partial grounding of the Company's 737 MAX 9 fleet in January, Copa Holdings would have reported an Ex-fuel CASM of approximately 5.8 cents for the quarter.
- The Company ended the quarter with approximately US$1.1 billion in cash, short-term and long-term investments, which represent 32% of the last twelve months' revenues.
- By the end of 1Q24, the Company had executed approximately US$40 million of the US$200 million share repurchase program approved by the Board of Directors.
- The Company closed the quarter with total debt, including lease liabilities, of US$1.7 billion, while our Adjusted Net Debt to EBITDA ratio ended at 0.5 times.
- During the quarter, the Company purchased from lessors two Boeing 737-800 NG aircraft, which were part of its current fleet as operating leases.
- The Company ended the quarter with a consolidated fleet of 106 aircraft – 67 Boeing 737-800s, 29 Boeing 737 MAX 9s, 9 Boeing 737-700s, and 1 Boeing 737-800 freighter.
- During the first quarter, Cirium recognized Copa Airlines as the carrier with the highest on-time performance in Latin America. In fact, Copa Airlines' on-time performance averaging above 90% for the quarter was the highest amongst all airlines in the Americas and one of the highest in the world.
Subsequent Events
- In April, the Company signed a confidential resolution with Boeing to cover the impact of the partial grounding of its Boeing 737 MAX 9 fleet in January. The value will be amortized through the depreciation and amortization line of our Income Statement.
- In May, the Company took delivery of two Boeing 737 MAX 9 aircraft, increasing its total fleet to 108 aircraft.
- Copa Holdings will make its second dividend payment of the year of US$1.61 per share on June 14, 2024, to all Class A and Class B shareholders on record as of May 31, 2024.
Consolidated Financial & Operating Highlights |
1Q24 |
1Q23 |
Variance vs. |
4Q23 |
Variance vs. |
Revenue Passengers Carried (000s) |
3,272 |
2,881 |
13.6 % |
3,310 |
(1.1) % |
Revenue Passengers OnBoard (000s) |
4,790 |
4,295 |
11.5 % |
4,930 |
(2.8) % |
RPMs (millions) |
6,127 |
5,723 |
7.1 % |
6,263 |
(2.2) % |
ASMs (millions) |
7,121 |
6,596 |
8.0 % |
7,228 |
(1.5) % |
Load Factor |
86.0 % |
86.8 % |
-0.7 p.p |
86.7 % |
-0.6 p.p |
Yield (US$ Cents) |
14.0 |
14.6 |
(3.8) % |
14.0 |
0.3 % |
PRASM (US$ Cents) |
12.1 |
12.6 |
(4.6) % |
12.1 |
(0.4) % |
RASM (US$ Cents) |
12.5 |
13.1 |
(4.6) % |
12.6 |
(0.7) % |
CASM (US$ Cents) |
9.5 |
10.2 |
(6.9) % |
9.7 |
(1.6) % |
CASM Excl. Fuel (US$ Cents) |
6.1 |
6.2 |
(2.0) % |
6.0 |
1.0 % |
Fuel Gallons Consumed (millions) |
84.4 |
78.2 |
7.9 % |
85.6 |
(1.5) % |
Avg. Price Per Fuel Gallon (US$) |
2.90 |
3.36 |
(13.9) % |
3.08 |
(5.8) % |
Average Length of Haul (miles) |
1,873 |
1,987 |
(5.8) % |
1,892 |
(1.0) % |
Average Stage Length (miles) |
1,246 |
1,281 |
(2.8) % |
1,229 |
1.4 % |
Departures |
35,220 |
31,984 |
10.1 % |
36,207 |
(2.7) % |
Block Hours |
112,164 |
104,626 |
7.2 % |
115,118 |
(2.6) % |
Average Aircraft Utilization (hours) |
11.6 |
11.9 |
(2.1) % |
11.9 |
(2.6) % |
Operating Revenues (US$ millions) |
893.5 |
867.3 |
3.0 % |
912.8 |
(2.1) % |
Operating Profit (Loss) (US$ millions) |
216.0 |
193.2 |
11.8 % |
214.3 |
0.8 % |
Operating Margin |
24.2 % |
22.3 % |
1.9 p.p |
23.5 % |
0.7 p.p |
Net Profit (Loss) (US$ millions) |
176.1 |
121.5 |
44.9 % |
187.7 |
(6.2) % |
Adjusted Net Profit (Loss) (US$ millions)(1) |
176.1 |
157.8 |
11.6 % |
184.3 |
(4.5) % |
Basic EPS (US$) |
4.19 |
3.07 |
36.3 % |
4.45 |
(6.0) % |
Adjusted Basic EPS (US$) (1) |
4.19 |
3.99 |
5.0 % |
4.37 |
(4.3) % |
Shares for calculation of Basic EPS (000s) |
42,052 |
39,565 |
6.3 % |
42,150 |
(0.2) % |
(1) Excludes Special Items. This earnings release includes a reconciliation of non-IFRS financial measures to the comparable IFRS measures.
FULL 1Q24 EARNINGS RELEASE AVAILABLE FOR DOWNLOAD AT:
https://copa.gcs-web.com/financial-information/quarterly-results
1Q24 EARNINGS RESULTS CONFERENCE CALL AND WEBCAST
Date: |
May 16, 2024 |
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Time: |
11:00 AM US ET (11:00 AM Local Time) |
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Join by phone: |
https://register.vevent.com/register/BIeac58d3f3e4f4841995aa07d6c718112 |
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Webcast (listen-only): |
|||
Speakers: |
Pedro Heilbron, Chief Executive Officer |
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José Montero, Chief Financial Officer |
About Copa Holdings
Copa Holdings is a leading Latin American provider of passenger and cargo services. The Company, through its operating subsidiaries, provides service to countries in North, Central, and South America and the Caribbean. For more information visit: www.copaair.com.
CONTACT: Copa Holdings S.A.
Investor Relations:
Ph: 011 507 304-2774
www.copaair.com (IR section)
This release includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on current plans, estimates, and expectations, and are not guarantees of future performance. They are based on management's expectations that involve several business risks and uncertainties, any of which could cause actual results to differ materially from those expressed in or implied by the forward-looking statements. The Company undertakes no obligation to update or revise any forward-looking statement. The risks and uncertainties relating to the forward-looking statements in this release are among those disclosed in Copa Holdings' filed disclosure documents and are, therefore, subject to change without prior notice.
CPA-G
Copa Holdings, S. A. and Subsidiaries
Consolidated statement of profit or loss
(In US$ thousands)
Unaudited |
Unaudited |
% |
Audited |
% |
|||||
1Q24 |
1Q23 |
Change |
4Q23 |
Change |
|||||
Operating Revenues |
|||||||||
Passenger revenue |
858,725 |
834,018 |
3.0 % |
875,257 |
(1.9 %) |
||||
Cargo and mail revenue |
21,910 |
23,252 |
(5.8 %) |
26,534 |
(17.4 %) |
||||
Other operating revenue |
12,831 |
9,995 |
28.4 % |
11,049 |
16.1 % |
||||
Total Operating Revenue |
893,467 |
867,264 |
3.0 % |
912,840 |
(2.1 %) |
||||
Operating Expenses |
|||||||||
Fuel |
245,352 |
265,498 |
(7.6 %) |
264,166 |
(7.1 %) |
||||
Wages, salaries, benefits and other employees' expenses |
114,314 |
102,652 |
11.4 % |
119,669 |
(4.5 %) |
||||
Passenger servicing |
29,684 |
20,391 |
45.6 % |
24,148 |
22.9 % |
||||
Airport facilities and handling charges |
60,347 |
50,479 |
19.5 % |
59,010 |
2.3 % |
||||
Sales and distribution |
55,494 |
61,406 |
(9.6 %) |
55,111 |
0.7 % |
||||
Maintenance, materials and repairs |
25,627 |
40,296 |
(36.4 %) |
31,276 |
(18.1 %) |
||||
Depreciation and amortization |
83,365 |
72,677 |
14.7 % |
80,261 |
3.9 % |
||||
Flight operations |
31,029 |
27,424 |
13.1 % |
27,987 |
10.9 % |
||||
Other operating and administrative expenses |
32,270 |
33,228 |
(2.9 %) |
36,875 |
(12.5 %) |
||||
Total Operating Expense |
677,482 |
674,053 |
0.5 % |
698,504 |
(3.0 %) |
||||
Operating Profit/(Loss) |
215,985 |
193,212 |
11.8 % |
214,335 |
0.8 % |
||||
Non-operating Income (Expense): |
|||||||||
Finance cost |
(18,840) |
(24,365) |
(22.7 %) |
(20,408) |
(7.7 %) |
||||
Finance income |
13,746 |
8,842 |
55.5 % |
14,289 |
(3.8 %) |
||||
Gain (loss) on foreign currency fluctuations |
(3,914) |
1,201 |
(425.8 %) |
(272) |
1339.3 % |
||||
Net change in fair value of derivatives |
(8) |
(37,933) |
(100.0 %) |
— |
— % |
||||
Other non-operating income (expense) |
(112) |
1,235 |
(109.1 %) |
3,126 |
(103.6 %) |
||||
Total Non-Operating Income/(Expense) |
(9,127) |
(51,020) |
(82.1 %) |
(3,264) |
179.6 % |
||||
Profit before taxes |
206,858 |
142,192 |
45.5 % |
211,071 |
(2.0 %) |
||||
Income tax expense |
(30,792) |
(20,671) |
49.0 % |
(23,378) |
31.7 % |
||||
Net Profit/(Loss) |
176,066 |
121,521 |
44.9 % |
187,693 |
(6.2 %) |
Copa Holdings, S. A. and Subsidiaries
Consolidated statement of financial position
(In US$ thousands)
March 2024 |
December 2023 |
|||
ASSETS |
(Unaudited) |
(Audited) |
||
Cash and cash equivalents |
170,525 |
206,375 |
||
Short-term investments |
630,640 |
708,809 |
||
Total cash, cash equivalents and short-term investments |
801,165 |
915,184 |
||
Accounts receivable, net |
192,486 |
156,720 |
||
Accounts receivable from related parties |
2,433 |
2,527 |
||
Expendable parts and supplies, net |
116,919 |
116,604 |
||
Prepaid expenses |
55,495 |
44,635 |
||
Prepaid income tax |
88 |
66 |
||
Other current assets |
32,548 |
32,227 |
||
399,968 |
352,780 |
|||
TOTAL CURRENT ASSETS |
1,201,133 |
1,267,963 |
||
Long-term investments |
301,192 |
258,934 |
||
Long-term prepaid expenses |
9,471 |
9,633 |
||
Property and equipment, net |
3,286,848 |
3,238,632 |
||
Right of use assets |
259,283 |
281,146 |
||
Intangible, net |
88,312 |
87,986 |
||
Net defined benefit assets |
5,373 |
5,346 |
||
Deferred tax assets |
20,999 |
30,148 |
||
Other Non-Current Assets |
16,722 |
17,048 |
||
TOTAL NON-CURRENT ASSETS |
3,988,199 |
3,928,872 |
||
TOTAL ASSETS |
5,189,332 |
5,196,836 |
||
LIABILITIES |
||||
Loans and borrowings |
233,110 |
222,430 |
||
Current portion of lease liability |
64,465 |
68,304 |
||
Accounts payable |
204,237 |
182,303 |
||
Accounts payable to related parties |
1,658 |
1,228 |
||
Air traffic liability |
579,476 |
611,856 |
||
Frequent flyer deferred revenue |
132,132 |
124,815 |
||
Taxes Payable |
53,565 |
44,210 |
||
Accrued expenses payable |
34,214 |
64,940 |
||
Income tax payable |
16,365 |
26,741 |
||
Other Current Liabilities |
1,468 |
1,403 |
||
TOTAL CURRENT LIABILITIES |
1,320,689 |
1,348,229 |
||
Loans and borrowings long-term |
1,198,017 |
1,240,261 |
||
Lease Liability |
198,387 |
215,353 |
||
Deferred tax Liabilities |
45,742 |
36,369 |
||
Other long - term liabilities |
235,014 |
234,474 |
||
TOTAL NON-CURRENT LIABILITIES |
1,677,161 |
1,726,457 |
||
TOTAL LIABILITIES |
2,997,850 |
3,074,685 |
||
EQUITY |
||||
Class A - 34,143,485 issued and 30,748,862 outstanding |
23,238 |
23,201 |
||
Class B - 10,938,125 |
7,466 |
7,466 |
||
Additional Paid-In Capital |
210,157 |
209,102 |
||
Treasury Stock |
(244,311) |
(204,130) |
||
Retained Earnings |
2,028,194 |
1,581,739 |
||
Net profit |
176,066 |
514,098 |
||
Other comprehensive loss |
(9,326) |
(9,326) |
||
TOTAL EQUITY |
2,191,483 |
2,122,150 |
||
TOTAL EQUITY LIABILITIES |
5,189,332 |
5,196,836 |
Copa Holdings, S. A. and Subsidiaries
Consolidated statement of cash flows
For the three months ended
(In US$ thousands)
2024 |
2023 |
2022 |
|||
(Unaudited) |
(Audited) |
(Audited) |
|||
Cash flow from operating activities |
200,998 |
203,419 |
169,336 |
||
Cash flow used in investing activities |
(78,334) |
(62,868) |
(120,515) |
||
Cash flow used in financing activities |
(158,514) |
(20,661) |
(10,888) |
||
Net (decrease) increase in cash and cash equivalents |
(35,850) |
119,890 |
37,933 |
||
Cash and cash equivalents at January 1 |
206,375 |
122,424 |
211,081 |
||
Cash and cash equivalents at March 31 |
$ 170,525 |
$ 242,314 |
$ 249,014 |
||
Short-term investments |
630,640 |
773,493 |
771,074 |
||
Long-term investments |
301,192 |
166,481 |
204,810 |
||
Total cash and cash equivalents and investments at March 31 |
$ 1,102,357 |
$ 1,182,288 |
$ 1,224,898 |
Copa Holdings, S.A.
NON-IFRS FINANCIAL MEASURE RECONCILIATION
This press release includes the following non-IFRS financial measures: Adjusted Net Profit, Adjusted Basic EPS, and Operating CASM Excluding Fuel. This supplemental information is presented because we believe it is a useful indicator of our operating performance and is useful in comparing our performance with other companies in the airline industry. These measures should not be considered in isolation and should be considered together with comparable IFRS measures, in particular operating profit, and net profit. The following is a reconciliation of these non-IFRS financial measures to the comparable IFRS measures:
Reconciliation of Adjusted Net Profit |
1Q24 |
1Q23 |
4Q23 |
|||
Net Profit as Reported |
$ 176,066 |
$ 121,521 |
$ 187,693 |
|||
Net change in fair value of derivatives |
$ — |
$ 37,933 |
$ — |
|||
Net change in fair value of financial investments |
$ — |
$ (1,655) |
$ (3,372) |
|||
Adjusted Net Profit |
$ 176,066 |
$ 157,799 |
$ 184,321 |
|||
Reconciliation of Adjusted Basic EPS |
1Q24 |
1Q23 |
4Q23 |
|||
Adjusted Net Profit |
$ 176,066 |
$ 157,799 |
$ 184,321 |
|||
Shares used for calculation of Basic EPS |
42,052 |
39,565 |
42,150 |
|||
Adjusted Basic Earnings per share (Adjusted Basic EPS) |
$ 4.19 |
$ 3.99 |
$ 4.37 |
|||
Reconciliation of Operating Costs per ASM |
||||||
Excluding Fuel (CASM Excl. Fuel) |
1Q24 |
1Q23 |
4Q23 |
|||
Operating Costs per ASM as Reported (in US$ Cents) |
9.5 |
10.2 |
9.7 |
|||
Aircraft Fuel Cost per ASM (in US$ Cents) |
3.4 |
4.0 |
3.7 |
|||
Operating Costs per ASM excluding fuel (in US$ Cents) |
6.1 |
6.2 |
6.0 |
SOURCE Copa Holdings, S.A.
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