Adjusted Net Profit for the second quarter came in at US$13.2 million, or Adjusted EPS of US$0.32
PANAMA CITY, Panama, Aug. 3, 2022 /PRNewswire/ — August 3, 2022. Copa Holdings, S.A. (NYSE: CPA), today announced financial results for the second quarter of 2022 (2Q22). 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 second quarter of 2019 (2Q19) (which the Company believes are more relevant than year-over-year comparisons due to the significant impacts in 2020 and 2021 of the COVID-19 pandemic).
OPERATING AND FINANCIAL HIGHLIGHTS
Copa Holdings’ adjusted net profit, excluding special items, for 2Q22 came in at US$13.2 million or US$0.32 per share, as compared to an adjusted net profit of US$50.9 million or earnings per share of US$1.20 in 2Q19.
Copa Holdings reported an operating profit of US$42.3 million for the quarter and a 6.1% operating margin, compared to an operating profit of US$82.6 million and an operating margin of 12.8% in 2Q19.
Total revenues for 2Q22 came in at US$693.4 million, a 7.5% increase compared to 2Q19 revenues. Passenger revenue for 2Q22 was 5.9% higher than 2Q19, while cargo revenue was 62.4% higher than 2Q19. Yields increased 10.1% to 13.0 cents while load factors decreased 0.4 percentage points to 84.8%, compared to 2Q19, resulting in Revenue per Available Seat Mile (RASM) of 11.6 cents, or 11.3% higher than 2Q19.
Operating cost per available seat mile (CASM) increased 19.9% from 9.1 cents in 2Q19 to 10.9 cents in 2Q22, driven by higher fuel prices. CASM excluding fuel (Ex-fuel CASM) decreased 4.6% in the quarter compared to 2Q19 to 6.0 cents.
Capacity for 2Q22, measured in terms of available seat miles (ASMs), was 96.6% of the capacity flown in 2Q19.
Including special items of US$110.9 million, comprised of an unrealized mark-to-market gain related to the Company’s convertible notes and an unrealized mark-to-market loss related to changes in the value of financial investments, the Company reported a net profit of US$124.1 million for the quarter or US$3.01 per share.
The Company ended the quarter with approximately US$1.1 billion in cash, short-term and long-term investments, which represents 47% of the last twelve months’ revenues.
The Company closed the quarter with total debt, including lease liabilities, of US$1.6 billion.
During the quarter, the Company took delivery of one Boeing 737 MAX 9 aircraft.
Including three Boeing 737-700 aircraft in temporary storage and one Boeing 737-800 freighter, Copa Holdings ended the quarter with a consolidated fleet of 94 aircraft – 68 Boeing 737-800s, 17 Boeing 737 MAX 9s, and 9 Boeing 737-700s.
Copa Airlines had an on-time performance for the quarter of 85.9% and a flight completion factor of 99.8%.
|
Consolidated Financial |
2Q22 |
2Q19 (3) |
Variance vs. 2Q19 |
1Q22 |
Variance vs. 1Q22 |
YTD22 |
YTD19 |
Variance vs. YTD19 |
|
Revenue Passengers Carried (000s) |
2,481 |
2,550 |
-2.7 % |
2,285 |
8.6 % |
4,765 |
5,138 |
-7.3 % |
|
Revenue Passengers OnBoard (000s) |
3,796 |
3,810 |
-0.4 % |
3,476 |
9.2 % |
7,272 |
7,640 |
-4.8 % |
|
RPMs (millions) |
5,047 |
5,249 |
-3.8 % |
4,585 |
10.1 % |
9,632 |
10,594 |
-9.1 % |
|
ASMs (millions) |
5,955 |
6,166 |
-3.4 % |
5,623 |
5.9 % |
11,578 |
12,581 |
-8.0 % |
|
Load Factor |
84.8 % |
85.1 % |
-0.4 p.p. |
81.5 % |
3.2 p.p. |
83.2 % |
84.2 % |
-1.0 p.p. |
|
Yield (US$ Cents) |
13.0 |
11.8 |
10.1 % |
11.8 |
10.3 % |
12.4 |
12.0 |
3.8 % |
|
PRASM (US$ Cents) |
11.0 |
10.1 |
9.6 % |
9.6 |
14.6 % |
10.3 |
10.1 |
2.6 % |
|
RASM (US$ Cents) |
11.6 |
10.5 |
11.3 % |
10.2 |
14.6 % |
10.9 |
10.5 |
4.4 % |
|
CASM (US$ Cents) |
10.9 |
9.1 |
19.9 % |
9.4 |
16.7 % |
10.2 |
8.9 |
14.1 % |
|
CASM Excl. Fuel (US$ Cents) |
6.0 |
6.2 |
-4.6 % |
6.0 |
0.0 % |
6.0 |
6.2 |
-3.1 % |
|
Fuel Gallons Consumed (millions) |
71.5 |
79.3 |
-9.9 % |
66.5 |
7.4 % |
138.0 |
160.5 |
-14.0 % |
|
Avg. Price Per Fuel Gallon (US$) |
4.14 |
2.22 |
86.1 % |
2.87 |
44.4 % |
3.52 |
2.15 |
63.7 % |
|
Average Length of Haul (miles) |
2,034 |
2,058 |
-1.2 % |
2,007 |
1.4 % |
2,021 |
2,062 |
-2.0 % |
|
Average Stage Length (miles) |
1,273 |
1,279 |
-0.4 % |
1,298 |
-1.9 % |
1,285 |
1,289 |
-0.3 % |
|
Departures |
29,369 |
32,676 |
-10.1 % |
27,190 |
8.0 % |
56,559 |
66,005 |
-14.3 % |
|
Block Hours |
95,315 |
106,425 |
-10.4 % |
88,474 |
7.7 % |
183,790 |
216,515 |
-15.1 % |
|
Average Aircraft Utilization (hours) (2) |
11.5 |
11.2 |
2.4 % |
11.0 |
5.0 % |
11.2 |
11.4 |
-1.8 % |
|
Operating Revenues (US$ millions) |
693.4 |
645.1 |
7.5 % |
571.6 |
21.3 % |
1,265.0 |
1,317.3 |
-4.0 % |
|
Operating Profit (Loss) (US$ millions) |
42.3 |
82.6 |
-48.8 % |
44.8 |
-5.6 % |
87.0 |
195.5 |
-55.5 % |
|
Operating Margin |
6.1 % |
12.8 % |
-6.7 p.p. |
7.8 % |
-1.7 p.p. |
6.9 % |
14.8 % |
-8.0 p.p. |
|
Net Profit (Loss) (US$ millions) |
124.1 |
50.9 |
143.9 % |
19.8 |
527.9 % |
143.8 |
140.3 |
2.5 % |
|
Adjusted Net Profit (Loss) (US$ millions) (1) |
13.2 |
50.9 |
-74.1 % |
29.5 |
-55.3 % |
42.7 |
140.3 |
-69.6 % |
|
Basic EPS (US$) |
3.01 |
1.20 |
151.4 % |
0.47 |
540.0 % |
3.49 |
3.30 |
5.7 % |
|
Adjusted Basic EPS (US$) (1) |
0.32 |
1.20 |
-73.3 % |
0.70 |
-54.5 % |
1.04 |
3.30 |
-68.7 % |
|
Shares for calculation of Basic EPS (000s) |
41,212 |
42,478 |
-3.0 % |
42,006 |
-1.9 % |
41,212 |
42,478 |
-3.0 % |
|
(1) Excludes Special Items. This earnings release includes a reconciliation of non-IFRS financial measures to the comparable IFRS measures. |
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(2) Average Aircraft Utilization is calculated based on the Company’s active fleet, excluding aircraft in storage as well as those classified as assets held for sale |
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(3) The Company believes that comparisons with 2019 are more relevant than year-over-year comparisons due to the significant impacts in 2020 of the COVID-19 pandemic. |
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FULL 2Q22 EARNINGS RELEASE AVAILABLE FOR DOWNLOAD AT:
https://copa.gcs-web.com/financial-information/quarterly-results
2Q22 EARNINGS RESULTS CONFERENCE CALL AND WEBCAST
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Date: |
August 4, 2022 |
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Time: |
11:00 AM US ET (10:00 AM Local Time) |
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Join by phone: |
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Webcast (listen-only): |
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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
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Copa Holdings, S.A. |
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Income Statement – IFRS |
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|
(US$ Thousands) |
||||||||||||||
|
Unaudited |
Unaudited |
% |
Unaudited |
% |
Unaudited |
Unaudited |
% |
|||||||
|
2Q22 |
2Q19 |
Change |
1Q22 |
Change |
YTD22 |
YTD19 |
Change |
|||||||
|
Operating Revenues |
||||||||||||||
|
Passenger revenue |
656,943 |
620,538 |
5.9 % |
541,255 |
21.4 % |
1,198,198 |
1,269,328 |
-5.6 % |
||||||
|
Cargo and mail revenue |
26,734 |
16,464 |
62.4 % |
21,537 |
24.1 % |
48,270 |
31,780 |
51.9 % |
||||||
|
Other operating revenue |
9,718 |
8,100 |
20.0 % |
8,790 |
10.6 % |
18,508 |
16,163 |
14.5 % |
||||||
|
Total Operating Revenue |
693,394 |
645,102 |
7.5 % |
571,582 |
21.3 % |
1,264,976 |
1,317,271 |
-4.0 % |
||||||
|
Operating Expenses |
||||||||||||||
|
Fuel |
295,952 |
177,169 |
67.0 % |
191,256 |
54.7 % |
487,208 |
347,332 |
40.3 % |
||||||
|
Wages, salaries, benefits and other employees’ expenses |
88,995 |
108,342 |
-17.9 % |
89,759 |
-0.9 % |
178,754 |
222,004 |
-19.5 % |
||||||
|
Passenger servicing |
16,074 |
25,530 |
-37.0 % |
15,607 |
3.0 % |
31,681 |
51,101 |
-38.0 % |
||||||
|
Airport facilities and handling charges |
47,280 |
44,698 |
5.8 % |
45,787 |
3.3 % |
93,067 |
90,060 |
3.3 % |
||||||
|
Sales and distribution |
56,222 |
51,289 |
9.6 % |
46,033 |
22.1 % |
102,255 |
104,421 |
-2.1 % |
||||||
|
Maintenance, materials and repairs |
28,311 |
31,235 |
-9.4 % |
23,350 |
21.2 % |
51,662 |
59,282 |
-12.9 % |
||||||
|
Depreciation and amortization |
65,337 |
70,549 |
-7.4 % |
63,303 |
3.2 % |
128,640 |
138,736 |
-7.3 % |
||||||
|
Flight operations |
24,068 |
25,450 |
-5.4 % |
22,039 |
9.2 % |
46,106 |
51,325 |
-10.2 % |
||||||
|
Other operating and administrative expenses |
28,894 |
28,240 |
2.3 % |
29,674 |
-2.6 % |
58,568 |
57,537 |
1.8 % |
||||||
|
Total Operating Expense |
651,133 |
562,502 |
15.8 % |
526,809 |
23.6 % |
1,177,942 |
1,121,798 |
5.0 % |
||||||
|
Operating Profit/(Loss) |
42,261 |
82,601 |
-48.8 % |
44,774 |
-5.6 % |
87,035 |
195,474 |
-55.5 % |
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|
Non-operating Income (Expense): |
||||||||||||||
|
Finance cost |
(21,270) |
(13,573) |
56.7 % |
(20,445) |
4.0 % |
(41,715) |
(27,583) |
51.2 % |
||||||
|
Finance income |
3,526 |
6,041 |
-41.6 % |
2,545 |
38.6 % |
6,071 |
11,995 |
-49.4 % |
||||||
|
Gain (loss) on foreign currency fluctuations |
(6,834) |
(2,213) |
208.8 % |
2,917 |
-334.2 % |
(3,916) |
(8,173) |
-52.1 % |
||||||
|
Net change in fair value of derivatives |
113,670 |
– |
-100.0 % |
(6,752) |
-1783.6 % |
106,918 |
– |
-100.0 % |
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|
Other non-operating income (expense) |
(2,717) |
(2,115) |
28.5 % |
(2,664) |
2.0 % |
(5,381) |
(2,940) |
83.0 % |
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|
Total Non-Operating Income/(Expense) |
86,375 |
(11,859) |
-828.3 % |
(24,398) |
-454.0 % |
61,977 |
(26,700) |
-332.1 % |
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|
Profit before taxes |
128,636 |
70,742 |
81.8 % |
20,376 |
531.3 % |
149,012 |
168,773 |
-11.7 % |
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|
Income tax expense |
(4,560) |
(19,876) |
-77.1 % |
(617) |
639.5 % |
(5,177) |
(28,476) |
-81.8 % |
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|
Net Profit/(Loss) |
124,076 |
50,866 |
143.9 % |
19,759 |
527.9 % |
143,835 |
140,297 |
2.5 % |
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|
EPS |
||||||||||||||
|
Basic |
3.01 |
1.20 |
151.4 % |
0.47 |
540.0 % |
3.49 |
3.30 |
5.7 % |
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|
Shares used for calculation: |
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|
Basic |
41,211,540 |
42,478,415 |
-3.0 % |
42,006,022 |
-1.9 % |
41,211,540 |
42,478,415 |
-3.0 % |
|
Copa Holdings, S. A. and subsidiaries |
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|
Consolidated statement of financial position |
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|
(US$ Thousands) |
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|
June 2022 |
December 2021 |
|
|
ASSETS |
(Unaudited) |
|
|
Cash and cash equivalents |
134,125 |
211,081 |
|
Short-term investments |
801,132 |
806,340 |
|
Total cash, cash equivalents and short-term investments |
935,257 |
1,017,421 |
|
– |
– |
|
|
Accounts receivable, net |
155,322 |
90,618 |
|
Accounts receivable from related parties |
1,767 |
1,832 |
|
Expendable parts and supplies, net |
88,980 |
74,778 |
|
Prepaid expenses |
42,029 |
31,148 |
|
Prepaid income tax |
15,832 |
16,938 |
|
Other current assets |
8,127 |
6,054 |
|
312,057 |
221,368 |
|
|
TOTAL CURRENT ASSETS |
1,247,314 |
1,238,789 |
|
Long-term investments |
140,374 |
199,670 |
|
Long-term prepaid expenses |
9,785 |
6,727 |
|
Property and equipment, net |
2,755,741 |
2,512,704 |
|
Right of use assets |
137,339 |
166,328 |
|
Intangible, net |
77,302 |
81,749 |
|
Deferred tax assets |
29,874 |
28,196 |
|
Other Non-Current Assets |
15,045 |
14,098 |
|
TOTAL NON-CURRENT ASSETS |
3,165,461 |
3,009,472 |
|
TOTAL ASSETS |
4,412,774 |
4,248,261 |
|
LIABILITIES |
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|
Loans and borrowings |
148,158 |
196,602 |
|
Current portion of lease liability |
75,494 |
73,917 |
|
Accounts payable |
142,711 |
112,596 |
|
Accounts payable to related parties |
27,400 |
7,948 |
|
Air traffic liability |
711,135 |
557,331 |
|
Frequent flyer deferred revenue |
100,230 |
95,114 |
|
Taxes Payable |
43,650 |
32,600 |
|
Employee benefits obligations |
29,933 |
32,767 |
|
Income tax payable |
4,993 |
3,835 |
|
Other Current Liabilities |
592 |
786 |
|
TOTAL CURRENT LIABILITIES |
1,284,295 |
1,113,496 |
|
Loans and borrowings long-term |
1,350,239 |
1,229,031 |
|
Lease Liability |
72,745 |
104,734 |
|
Net Defined Benefit Liability |
7,006 |
7,670 |
|
Derivative financial instruments |
161,420 |
268,338 |
|
Deferred tax Liabilities |
18,919 |
18,782 |
|
Other long – term liabilities |
221,480 |
206,813 |
|
TOTAL NON-CURRENT LIABILITIES |
1,831,810 |
1,835,368 |
|
TOTAL LIABILITIES |
3,116,105 |
2,948,864 |
|
EQUITY |
– |
– |
|
Class A – 34,012,213 issued and 28,770,135 outstanding |
21,326 |
21,289 |
|
Class B – 10,938,125 |
7,466 |
7,466 |
|
Additional Paid-In Capital |
100,945 |
98,348 |
|
Treasury Stock |
(326,239) |
(176,902) |
|
Retained Earnings |
1,367,868 |
1,324,022 |
|
Net profit |
143,835 |
43,844 |
|
Other comprehensive loss |
(18,531) |
(18,670) |
|
TOTAL EQUITY |
1,296,669 |
1,299,397 |
|
TOTAL EQUITY LIABILITIES |
4,412,774 |
4,248,261 |
|
Copa Holdings, S. A. and subsidiaries |
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|
Consolidated Statement of Cash Flows |
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|
For the six months ended June 30, |
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|
(In US$ thousands) |
|||||||||||||
|
2022 |
2021 |
2020 |
|||||||||||
|
(Unaudited) |
(Unaudited) |
(Unaudited) |
|||||||||||
|
Cash flow from (used in) operating activities |
327,833 |
149,669 |
(56,632) |
||||||||||
|
Cash flow used in investing activities |
(262,743) |
(119,776) |
(48,009) |
||||||||||
|
Cash flow (used in) from financing activities |
(142,046) |
107,806 |
253,205 |
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|
Net (decrease) increase in cash and cash equivalents |
(76,956) |
137,699 |
148,564 |
||||||||||
|
Cash and cash equivalents at January 1 |
211,081 |
119,065 |
158,733 |
||||||||||
|
Cash and cash equivalents at June 30 |
$ 134,125 |
$ 256,764 |
$ 307,297 |
||||||||||
|
Short-term investments |
801,132 |
925,680 |
740,887 |
||||||||||
|
Long-term investments |
140,374 |
99,235 |
95,540 |
||||||||||
|
Total cash and cash equivalents and investments at June 30 |
$ 1,075,631 |
$ 1,281,679 |
$ 1,143,724 |
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Copa Holdings, S.A.
NON-IFRS FINANCIAL MEASURE RECONCILIATION
This press release includes the following non-IFRS financial measures: Adjusted Operating Profit, 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 Operating Profit |
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|
and Adjusted Net Profit |
2Q22 |
2Q21 |
1Q22 |
2Q19 |
||||
|
Operating Profit as Reported |
$ 42,261 |
$ 8,736 |
$ 44,774 |
$ 82,601 |
||||
|
Subtract: Unredeemed Ticket Revenue provision reversal |
$ (10,395) |
|||||||
|
Adjusted Operating Profit |
$ 42,261 |
$ (1,659) |
$ 44,774 |
$ 82,601 |
||||
|
Net Profit as Reported |
$ 124,076 |
$ 28,073 |
$ 19,759 |
$ 50,866 |
||||
|
Subtract: Unredeemed Ticket Revenue provision reversal |
$ (10,395) |
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|
Add: Net change in fair value of derivatives |
$ (113,670) |
$ (33,898) |
$ 6,752 |
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|
Add: Net change in fair value of financial investments |
$ 2,761 |
$ 2,979 |
||||||
|
Adjusted Net Profit |
$ 13,168 |
$ (16,220) |
$ 29,490 |
$ 50,866 |
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|
Reconciliation of Adjusted Basic EPS |
2Q22 |
2Q21 |
1Q22 |
2Q19 |
||||
|
Adjusted Net Profit |
$ 13,168 |
$ (16,220) |
$ 29,490 |
$ 50,866 |
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|
Shares used for calculation of Basic EPS |
41,212 |
42,651 |
42,006 |
42,478 |
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|
Adjusted Basic Earnings per share (Adjusted Basic EPS) |
$ 0.32 |
$ (0.38) |
$ 0.70 |
$ 1.20 |
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|
Reconciliation of Operating Costs per ASM |
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|
Excluding Fuel (CASM Excl. Fuel) |
2Q22 |
2Q21 |
1Q22 |
2Q19 |
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|
Operating Costs per ASM as Reported (in US$ Cents) |
10.9 |
9.0 |
9.4 |
9.1 |
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|
Aircraft Fuel Cost per ASM (in US$ Cents) |
5.0 |
2.5 |
3.4 |
2.9 |
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Operating Costs per ASM excluding fuel (in US$ Cents) |
6.0 |
6.6 |
6.0 |
6.2 |
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SOURCE Copa Holdings, S.A.