PANAMA CITY, Aug. 7, 2013 /PRNewswire/ -- Copa Holdings, S.A. (NYSE: CPA), today announced financial results for the second quarter of 2013 (2Q13). The terms "Copa Holdings" or "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 financial tables section of this earnings release. Unless otherwise stated, all comparisons with prior periods refer to the second quarter of 2012 (2Q12).
OPERATING AND FINANCIAL HIGHLIGHTS
- Copa Holdings reported net income of US$74.4 million for 2Q13, or diluted earnings per share (EPS) of US$1.68. Excluding special items, Copa Holdings would have reported an adjusted net income of $85.0 million, or $1.92 per share, a 45.3% increase over adjusted net income of US$58.5 million and US$1.32 per share for 2Q12.
- Operating income for 2Q13 came in at US$97.7 million, a 34.5% increase over operating income of US$72.6 million in 2Q12. Operating margin for the period came in at 16.5%, compared to 14.1% in 2Q12, as a result of lower unit costs.
- Total revenues increased 14.8% to US$592.0 million. Yield per passenger mile decreased 4.6% to 16.4 cents and operating revenue per available seat mile (RASM) decreased 2.5% to 12.8 cents. However, adjusting for a 7.3% increase in length of haul, yields decreased 1.2% and RASM increased 1.0%.
- For 2Q13, passenger traffic (RPMs) grew 20.4% on a 17.7% capacity expansion. Consolidated load factor came in at 75.3%, or 1.7 percentage points above 2Q12.
- Operating cost per available seat mile (CASM) decreased 5.2%, from 11.3 cents in 2Q12 to 10.7 cents in 2Q13. CASM, excluding fuel costs, decreased 2.6% to 6.7 cents.
- Cash, short term and long term investments ended 2Q13 at US$848.7 million, representing 35.0% of the last twelve months' revenues.
- During the second quarter, Copa Airlines took delivery of one Boeing 737-800 aircraft. As a result, Copa Holdings ended the quarter with a consolidated fleet of 86 aircraft.
- For 2Q13, Copa Holdings reported consolidated on-time performance of 89.3% and a flight-completion factor of 99.7%, maintaining its position among the best in the industry.
SUBSEQUENT EVENTS
- On July 17, 2013, Copa Airlines announced it will begin nonstop service four times a week from Panama to Tampa, Fla., on December 16, 2013. Tampa will be Copa Airlines' ninth U.S. destination and its 66th destination overall.
- On August 7, 2013, the Board of Directors of Copa Holdings resolved to change the Company's dividend policy to increase the annual distribution to an amount equal to 40% of the prior years' annual consolidated net income. In addition, dividends going forward will be distributed in equal quarterly installments during the months of March, June, September and December, subject to board approval each quarter. On August 7, 2013, the Board of Directors also approved dividend payments payable at the end of both 3Q13 and 4Q13, in amounts equal to 10% of the consolidated net income of 2012.
Consolidated Financial & | 2Q13 | 2Q12 | % Change | 1Q13 | % Change |
Revenue Passengers Carried ('000) | 1,861 | 1,658 | 12.2% | 1,899 | -2.0% |
RPMs (mm) | 3,475 | 2,886 | 20.4% | 3,529 | -1.5% |
ASMs (mm) | 4,618 | 3,923 | 17.7% | 4,590 | 0.6% |
Load Factor | 75.3% | 73.5% | 1.7 p.p. | 76.9% | -1.6 p.p. |
Yield | 16.4 | 17.2 | -4.6% | 17.6 | -6.9% |
PRASM (US$ Cents) | 12.3 | 12.6 | -2.3% | 13.5 | -8.9% |
RASM (US$ Cents) | 12.8 | 13.1 | -2.5% | 14.0 | -8.2% |
CASM (US$ Cents) | 10.7 | 11.3 | -5.2% | 10.9 | -1.5% |
CASM Excl. Fuel (US$ Cents) | 6.7 | 6.9 | -2.6% | 6.5 | 3.3% |
Breakeven Load Factor (1) | 61.6% | 63.0% | -1.4 p.p. | 58.7% | 2.9 p.p. |
Fuel Gallons Consumed (Millions) | 60.0 | 52.1 | 15.0% | 60.1 | -0.2% |
Avg. Price Per Fuel Gallon (US$ Dollars) | 3.08 | 3.32 | -7.3% | 3.34 | -7.8% |
Average Length of Haul (Miles) | 1,868 | 1,740 | 7.3% | 1,859 | 0.5% |
Average Stage Length (Miles) | 1,126 | 1,063 | 6.0% | 1,123 | 0.2% |
Departures | 29,357 | 27,005 | 8.7% | 29,428 | -0.2% |
Block Hours | 84,985 | 74,678 | 13.8% | 84,490 | 0.6% |
Average Aircraft Utilization (Hours) | 10.9 | 10.6 | 3.1% | 11.3 | -3.5% |
Operating Revenues (US$ mm) | 592.0 | 515.8 | 14.8% | 641.3 | -7.7% |
Operating Income (US$ mm) | 97.7 | 72.6 | 34.5% | 142.6 | -31.5% |
Operating Margin | 16.5% | 14.1% | 2.4 p.p. | 22.2% | -5.7 p.p. |
Net Income (US$ mm) | 74.4 | 32.0 | 132.6% | 113.8 | -34.6% |
Adjusted Net Income (US$ mm) (1) | 85.0 | 58.5 | 45.3% | 124.4 | -31.6% |
EPS - Basic and Diluted (US$) | 1.68 | 0.72 | 132.4% | 2.56 | -34.6% |
Adjusted EPS - Basic and Diluted (US$) (1) | 1.92 | 1.32 | 45.2% | 2.80 | -31.6% |
# of Shares - Basic and Diluted ('000) | 44,387 | 44,354 | 0.1% | 44,387 | 0.0% |
(1)Breakeven Load Factor, Adjusted Net Income and Adjusted EPS for 2Q13, 2Q12, and 1Q13 exclude non-cash charges/gains associated with the mark-to-market of fuel hedges. Additionally, for 1Q13 excludes a US$13.9 million charge related to the devaluation of the Venezuelan currency.
Note: Attached to this press release is a reconciliation of non-IFRS financial measures to the comparable IFRS measures.
FULL 2Q13 EARNINGS RELEASE AVAILABLE FOR DOWNLOAD AT: http://investor.shareholder.com/copa/results.cfm
2Q13 EARNINGS RESULTS CONFERENCE CALL AND WEBCAST
Date: | August 8, 2013 | |||
Time: | 11:00 AM US ET (10:00 AM Local Time) | |||
Conference telephone number: | 877-293-5456 (US Domestic Callers) | |||
707-287-9357(International Callers) | ||||
Webcast: | http://investor.shareholder.com/copa/events.cfm | |||
Speakers: | Pedro Heilbron, Chief Executive Officer | |||
Jose Montero, Chief Financial Officer | ||||
Copa Holdings is a leading Latin American provider of passenger and cargo services. The Company, through its operating subsidiaries, provides service to 65 destinations in 29 countries in North, Central and South America and the Caribbean with one of the youngest and most modern fleets in the industry, consisting of 87 aircraft: 61 Boeing 737NG aircraft and 26 EMBRAER-190s. For more information visit: www.copaair.com.
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 a number of 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. | |||||||||
Income Statement - IFRS | |||||||||
(US$ Thousands) | |||||||||
Unaudited | Unaudited | % | Unaudited | % | |||||
2Q13 | 2Q12 | Change | 1Q13 | Change | |||||
Operating Revenues | |||||||||
Passenger Revenue | 568,960 | 495,029 | 14.9% | 620,488 | -8.3% | ||||
Cargo, mail and other | 23,038 | 20,814 | 10.7% | 20,793 | 10.8% | ||||
Total Operating Revenue | 591,998 | 515,843 | 14.8% | 641,282 | -7.7% | ||||
Operating Expenses | |||||||||
Aircraft fuel | 184,767 | 173,289 | 6.6% | 200,773 | -8.0% | ||||
Salaries and benefits | 66,105 | 61,123 | 8.2% | 66,728 | -0.9% | ||||
Passenger servicing | 60,389 | 50,943 | 18.5% | 60,316 | 0.1% | ||||
Commissions | 24,279 | 21,272 | 14.1% | 24,260 | 0.1% | ||||
Reservations and sales | 24,763 | 20,586 | 20.3% | 21,449 | 15.5% | ||||
Maintenance, material and repairs | 22,807 | 23,954 | -4.8% | 22,284 | 2.3% | ||||
Depreciation | 26,866 | 21,214 | 26.6% | 24,806 | 8.3% | ||||
Flight operations | 30,028 | 24,991 | 20.2% | 29,479 | 1.9% | ||||
Aircraft rentals | 22,124 | 17,191 | 28.7% | 19,952 | 10.9% | ||||
Landing fees and other rentals | 12,789 | 10,931 | 17.0% | 12,195 | 4.9% | ||||
Other | 19,393 | 17,730 | 9.4% | 16,412 | 18.2% | ||||
Total Operating Expense | 494,309 | 443,224 | 11.5% | 498,655 | -0.9% | ||||
Operating Income | 97,689 | 72,619 | 34.5% | 142,626 | -31.5% | ||||
Non-operating Income (Expense): | |||||||||
Interest expense | (7,560) | (8,583) | -11.9% | (7,660) | -1.3% | ||||
Interest capitalized | 0 | 0 | nm | 0 | nm | ||||
Interest income | 2,841 | 2,741 | 3.6% | 2,706 | 5.0% | ||||
Other, net | (10,616) | (30,982) | -65.7% | (9,195) | 15.5% | ||||
Total Non-Operating Income/(Expense) | (15,336) | (36,824) | n/a | (14,150) | 8.4% | ||||
Income before Income Taxes | 82,354 | 35,796 | 130.1% | 128,476 | -35.9% | ||||
Provision for Income Taxes | 7,912 | 3,790 | 108.8% | 14,646 | -46.0% | ||||
Net Income | 74,441 | 32,006 | 132.6% | 113,830 | -34.6% | ||||
EPS - Basic and Diluted | 1.68 | 0.72 | 132.4% | 2.56 | -34.6% | ||||
Shares - Basic and Diluted | 44,387,279 | 44,353,845 | 0.1% | 44,387,148 | 0.0% |
Copa Holdings, S.A. | |||||
Balance Sheet - IFRS | |||||
(US$ Thousands) | June 30, | December 31, | |||
2013 | 2012 | ||||
(Unaudited) | (Audited) | ||||
ASSETS | |||||
Current Assets: | |||||
Cash and cash equivalents | $ 327,385 | $ 76,094 | |||
Short-term investments | 479,676 | 575,009 | |||
Total cash, cash equivalents and short-term investments | 807,061 | 651,103 | |||
Accounts receivable, net of allowance for doubtful accounts | 169,115 | 135,207 | |||
Accounts receivable from related parties | 2,054 | 1,129 | |||
Expendable parts and supplies, net of allowance for obsolescence | 49,111 | 50,603 | |||
Prepaid expenses | 63,502 | 63,120 | |||
Other current assets | 12,472 | 16,328 | |||
Total Current Assets | 1,103,315 | 917,490 | |||
Long-term investments | 41,591 | 69,445 | |||
Property and Equipment: | |||||
Owned property and equipment: | |||||
Flight equipment | 2,448,950 | 2,405,346 | |||
Other equipment | 70,953 | 66,330 | |||
2,519,903 | 2,471,676 | ||||
Less: Accumulated depreciation | (480,853) | (432,589) | |||
2,039,050 | 2,039,087 | ||||
Purchase deposits for flight equipment | 284,238 | 245,544 | |||
Total Property and Equipment | 2,323,288 | 2,284,631 | |||
Other Assets: | |||||
Net pension asset | 10,974 | 10,009 | |||
Goodwill | 25,277 | 27,575 | |||
Intangible asset | 57,748 | 59,382 | |||
Other assets | 111,643 | 110,968 | |||
Total Other Assets | 205,642 | 207,934 | |||
Total Assets | $ 3,673,836 | $ 3,479,500 | |||
LIABILITIES AND SHAREHOLDER'S EQUITY | |||||
Current Liabilities: | |||||
Current maturities of long-term debt | $ 131,474 | $ 136,268 | |||
Accounts payable | 102,209 | 104,975 | |||
Accounts payable to related parties | 14,232 | 20,255 | |||
Air traffic liability | 442,172 | 382,807 | |||
Taxes and interest payable | 98,519 | 85,436 | |||
Accrued expenses payable | 59,279 | 48,047 | |||
Other current liabilities | 11,883 | 10,902 | |||
Total Current Liabilities | 859,768 | 788,690 | |||
Non-Current Liabilities: | |||||
Long-term debt | 999,549 | 1,069,836 | |||
Post employment benefits liability | 6,293 | 6,340 | |||
Other long-term liabilities | 46,910 | 43,726 | |||
Deferred tax liabilities | 36,803 | 34,364 | |||
Total Non-Current Liabilities | 1,089,555 | 1,154,266 | |||
Total Liabilities | 1,949,323 | 1,942,956 | |||
Shareholders' Equity: | |||||
Class A - 33,408,928 shares issued and outstanding | 22,626 | 22,591 | |||
Class B - 10,938,125 shares issued and outstanding | 7,466 | 7,466 | |||
Additional paid in capital | 44,442 | 40,660 | |||
Retained earnings | 1,646,529 | 1,458,258 | |||
Accumulated other comprehensive income (loss) | 3,450 | 7,569 | |||
Total Shareholders' Equity | 1,724,513 | 1,536,544 | |||
Total Liabilities and Shareholders' Equity | $ 3,673,836 | $ 3,479,500 | |||
NON-IFRS FINANCIAL MEASURE RECONCILIATION
This press release includes the following non IFRS financial measures: CASM Excluding Fuel, Adjusted Net Income and Adjusted EPS.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 income and net income. The following is a reconciliation of these non-IFRS financial measures to the comparable IFRS measures:
Reconciliation of Net Income | ||||||
Excluding Special Items | 2Q13 | 2Q12 | 1Q13 | |||
Net income as Reported | $74,441 | $32,006 | $113,830 | |||
Special Items (adjustments): | ||||||
Unrealized (gain) loss on fuel hedging instruments | 10,582 | 26,510 | (3,376) | |||
Loss due to devaluation of Venezuelan Bolivar | 13,927 | |||||
Adjusted Net Income | $85,023 | $58,515 | $124,381 | |||
Shares used for Computation (in thousands) | ||||||
Basic and Diluted | 44,387 | 44,354 | 44,387 | |||
Adjusted earnings per share - Basic and Diluted | 1.92 | 1.32 | 2.80 | |||
Reconciliation Operating Costs per ASM | ||||||
Excluding Fuel and Special Items | 2Q13 | 2Q12 | 1Q13 | |||
Operating Costs per ASM as Reported | 10.7 | 11.3 | 10.9 | |||
Aircraft fuel per ASM | (4.0) | (4.4) | (4.4) | |||
Operating Costs per ASM excluding fuel | 6.7 | 6.9 | 6.5 | |||
SOURCE Copa Holdings, S.A.
