PANAMA CITY, May 5, 2016 /PRNewswire/ -- Copa Holdings, S.A. (NYSE: CPA), today announced financial results for the first quarter of 2016(1Q16). 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 first quarter of 2015 (1Q15).
OPERATING AND FINANCIAL HIGHLIGHTS
- Copa Holdings reported net income of US$115.5 million for 1Q16, or diluted earnings per share (EPS) of US$2.74. Excluding special items, Copa Holdings would have reported an adjusted net income of US$69.9 million, or EPS of US$1.66 per share, a 31.1% decrease over adjusted net income of US$106.1 million and US$2.41 per share for 1Q15.
- Operating income for 1Q16 came in at US$94.1 million, a 26.1% decrease over operating income of US$127.3 million in 1Q15. Operating margin for the period came in at 16.9%, compared to 20.1% in 1Q15, as a result of lower unit revenues partially offset by lower unit costs.
- Total revenues decreased 11.8% to US$557.1 million. Yield per passenger mile decreased 15.4% to 12.5 cents and operating revenue per available seat mile (RASM) decreased 13.9% to 10.0 cents.
- For 1Q16, passenger traffic (RPMs) grew 3.6% on a 2.4% capacity expansion. Consolidated load factor came in at 77.4%, 0.9 percentage points above 1Q15.
- Operating cost per available seat mile (CASM) decreased 10.4%, from 9.3 cents in 1Q15 to 8.3 cents in 1Q16, mainly due to lower jet fuel costs, despite US$29 million in realized fuel hedge losses. CASM, excluding fuel, decreased 2.8% to 6.2 cents mainly due to weaker regional currencies and contract renegotiations with various suppliers.
- Cash, short-term and long-term investments ended 1Q16 at US$723.9 million, representing 33% of the last twelve months' revenues.
- For 1Q16, Copa Holdings reported consolidated on-time performance of 90.6% and a flight-completion factor of 99.8%, maintaining its position among the best in the industry.
Subsequent Events
- On May 2nd, 2016, Copa Holdings filed its 2015 20-F Annual Report. In its 2015 audited financial statements, the company recognized a $430.2 million U.S. dollar foreign currency translation loss, on its bolivar cash balance, due to the migration to an exchange rate of 198.69 bolivars per U.S. dollar, instead of the previously used rate of 6.3 bolivars per U.S. dollar.
- On June 15th, 2016, Copa Holdings will pay its second quarter dividend of US$0.51 per share, on all outstanding Class A and Class B shares, to stockholders of record as of May 31st, 2016.
Consolidated Financial & | 1Q16 | 1Q15 | % Change | 4Q15 | % Change |
Revenue Passengers Carried ('000) | 2,120 | 1,965 | 7.9% | 2,055 | 3.2% |
RPMs (mm) | 4,307 | 4,158 | 3.6% | 4,103 | 5.0% |
ASMs (mm) | 5,566 | 5,433 | 2.4% | 5,486 | 1.5% |
Load Factor | 77.4% | 76.5% | 0.9 p.p. | 74.8% | 2.6 p.p. |
Yield | 12.5 | 14.8 | -15.4% | 12.5 | 0.0% |
PRASM (US$ Cents) | 9.7 | 11.3 | -14.5% | 9.3 | 3.5% |
RASM (US$ Cents) | 10.0 | 11.6 | -13.9% | 9.7 | 3.1% |
CASM (US$ Cents) | 8.3 | 9.3 | -10.4% | 9.0 | -7.5% |
CASM Excl. Fuel (US$ Cents) | 6.2 | 6.3 | -2.8% | 6.5 | -5.4% |
Breakeven Load Factor (1) | 65.0% | 60.2% | 4.8 p.p. | 67.1% | -2.1 p.p. |
Fuel Gallons Consumed (Millions) | 71.7 | 69.6 | 3.0% | 70.5 | 1.7% |
Avg. Price Per Fuel Gallon (US$ Dollars) | 1.68 | 2.31 | -27.2% | 1.94 | -13.5% |
Average Length of Haul (Miles) | 2,031 | 2,116 | -4.0% | 1,997 | 1.7% |
Average Stage Length (Miles) | 1,223 | 1,247 | -1.9% | 1,222 | 0.1% |
Departures | 31,518 | 30,691 | 2.7% | 31,184 | 1.1% |
Block Hours | 97,632 | 97,820 | -0.2% | 97,788 | -0.2% |
Average Aircraft Utilization (Hours) | 10.7 | 11.1 | -3.3% | 10.7 | 0.6% |
Operating Revenues (US$ mm) | 557.1 | 631.9 | -11.8% | 532.6 | 4.6% |
Operating Income (US$ mm) | 94.1 | 127.3 | -26.1% | 39.1 | 140.8% |
Operating Margin | 16.9% | 20.1% | -3.3 p.p. | 7.3% | 9.6 p.p. |
Net Income (US$ mm) | 115.5 | 113.2 | 2.0% | -408.5 | n/m |
Adjusted Net Income (US$ mm) (1) | 69.9 | 106.1 | -34.1% | 41.5 | 68.4% |
EPS - Basic and Diluted (US$) | 2.74 | 2.57 | 6.8% | -9.44 | n/m |
Adjusted EPS - Basic and Diluted (US$) (1) | 1.66 | 2.41 | -31.1% | 0.96 | 73.1% |
# of Shares - Basic and Diluted ('000) | 42,109 | 44,077 | -4.5% | 43,286 | -2.7% |
(1) Breakeven Load Factor, Adjusted Net Income and Adjusted EPS for 1Q16, 1Q15, and 4Q15 exclude non-cash charges/gains associated with | |||||
Note: Attached to this press release is a reconciliation of non-IFRS financial measures to the comparable IFRS measures. |
FULL 1Q16 EARNINGS RELEASE AVAILABLE FOR DOWNLOAD AT: http://investor.shareholder.com/copa/results.cfm
1Q16 EARNINGS RESULTS CONFERENCE CALL AND WEBCAST
Date: | May 6, 2016 | ||
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: | |||
Speakers: | Pedro Heilbron, Chief Executive Officer | ||
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 76 destinations in 31 countries in North, Central and South America and the Caribbean with one of the youngest and most modern fleets in the industry, consisting of 100 aircraft: 77 Boeing 737NG aircraft and 23 EMBRAER-190s. For more information visit: www.copa.com.
CONTACT: Copa Holdings S.A.
Investor Relations:
Ph: (507) 304-2774
www.copa.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 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 | % | |||||
1Q16 | 1Q15 | Change | 4Q15 | Change | |||||
Operating Revenues | |||||||||
Passenger Revenue | 537,695 | 613,538 | -12.4% | 512,150 | 5.0% | ||||
Cargo, mail and other | 19,376 | 18,323 | 5.7% | 20,451 | -5.3% | ||||
Total Operating Revenue | 557,072 | 631,861 | -11.8% | 532,601 | 4.6% | ||||
Operating Expenses | |||||||||
Aircraft fuel | 120,549 | 160,791 | -25.0% | 136,881 | -11.9% | ||||
Salaries and benefits | 73,683 | 77,999 | -5.5% | 70,407 | 4.7% | ||||
Passenger servicing | 60,498 | 66,123 | -8.5% | 63,689 | -5.0% | ||||
Commissions | 20,980 | 25,988 | -19.3% | 19,556 | 7.3% | ||||
Reservations and sales | 26,037 | 21,500 | 21.1% | 24,882 | 4.6% | ||||
Maintenance, material and repairs | 29,412 | 25,708 | 14.4% | 31,528 | -6.7% | ||||
Depreciation | 34,388 | 31,464 | 9.3% | 34,083 | 0.9% | ||||
Flight operations | 31,932 | 33,369 | -4.3% | 34,028 | -6.2% | ||||
Aircraft rentals | 30,809 | 30,244 | 1.9% | 31,530 | -2.3% | ||||
Landing fees and other rentals | 13,302 | 13,748 | -3.2% | 13,481 | -1.3% | ||||
Other | 21,390 | 17,629 | 21.3% | 33,458 | -36.1% | ||||
Total Operating Expense | 462,980 | 504,562 | -8.2% | 493,523 | -6.2% | ||||
Operating Income | 94,091 | 127,299 | -26.1% | 39,077 | 140.8% | ||||
Non-operating Income (Expense): | |||||||||
Interest expense | (9,301) | (7,590) | 22.5% | (8,922) | 4.2% | ||||
Interest income | 2,777 | 6,275 | -55.7% | 8,155 | -65.9% | ||||
Other, net | 39,362 | 2,130 | n/m | (440,284) | n/m | ||||
Total Non-Operating Income/(Expense) | 32,838 | 815 | n/m | (441,051) | n/m | ||||
Income before Income Taxes | 126,929 | 128,114 | -0.9% | (401,973) | n/m | ||||
Provision for Income Taxes | 11,474 | 14,926 | -23.1% | 6,499 | 76.6% | ||||
Net Income | 115,456 | 113,188 | 2.0% | (408,472) | n/m | ||||
EPS - Basic and Diluted | 2.74 | 2.57 | 6.8% | -9.44 | -129.1% | ||||
Shares - Basic and Diluted | 42,109,094 | 44,077,111 | -4.5% | 43,285,727 | -2.7% |
Copa Holdings, S.A. | |||||
Balance Sheet - IFRS | |||||
(US$ Thousands) | March 31, | December 31, | |||
2016 | 2015 | ||||
(Unaudited) | (Audited) | ||||
ASSETS | |||||
Current Assets: | |||||
Cash and cash equivalents | $ 209,953 | $ 204,715 | |||
Restricted cash and cash equivalents | 55,611 | 64,228 | |||
Short-term investments | 457,505 | 416,005 | |||
Total cash, cash equivalents and short-term investments | 723,069 | 684,948 | |||
Accounts receivable, net of allowance for doubtful accounts | 116,319 | 105,135 | |||
Accounts receivable from related parties | 557 | 642 | |||
Expendable parts and supplies, net of allowance for obsolescence | 62,984 | 62,247 | |||
Prepaid expenses | 53,988 | 48,667 | |||
Other current assets | 5,624 | 5,946 | |||
Total Current Assets | 962,541 | 907,585 | |||
Long-term investments | 864 | 861 | |||
Property and Equipment: | |||||
Owned property and equipment: | |||||
Flight equipment | 3,019,901 | 3,030,361 | |||
Other equipment | 118,760 | 121,205 | |||
3,138,661 | 3,151,566 | ||||
Less: Accumulated depreciation | (764,461) | (743,983) | |||
2,374,200 | 2,407,583 | ||||
Purchase deposits for flight equipment | 240,966 | 243,070 | |||
Total Property and Equipment | 2,615,166 | 2,650,653 | |||
Other Assets: | |||||
Net pension asset | 7,722 | 6,050 | |||
Goodwill | 20,380 | 20,380 | |||
Intangible asset | 50,085 | 49,046 | |||
Deferred tax Assets | 16,351 | 12,708 | |||
Other assets | 62,941 | 68,193 | |||
Total Other Assets | 157,479 | 156,377 | |||
Total Assets | $ 3,736,050 | $ 3,715,476 | |||
LIABILITIES AND SHAREHOLDER'S EQUITY | |||||
Current Liabilities: | |||||
Current maturities of long-term debt | $ 229,347 | $ 245,514 | |||
Accounts payable | 95,817 | 94,741 | |||
Accounts payable to related parties | 9,265 | 5,605 | |||
Air traffic liability | 321,034 | 352,110 | |||
Frequent flyer deferred revenue | 26,810 | 18,884 | |||
Taxes and interest payable | 87,305 | 67,242 | |||
Accrued expenses payable | 67,135 | 82,948 | |||
Other current liabilities | 91,363 | 118,623 | |||
Total Current Liabilities | 928,076 | 985,667 | |||
Non-Current Liabilities: | |||||
Long-term debt | 1,021,159 | 1,055,183 | |||
Other long-term liabilities | 67,148 | 54,339 | |||
Deferred tax liabilities | 37,224 | 32,865 | |||
Total Non-Current Liabilities | 1,125,531 | 1,142,387 | |||
Total Liabilities | 2,053,607 | 2,128,054 | |||
Shareholders' Equity: | |||||
Class A - 33,478,724 issued and 31,106,084 outstanding | 20,984 | 20,924 | |||
Class B - 10,938,125 shares issued and outstanding | 7,466 | 7,466 | |||
Additional paid in capital | 58,432 | 57,455 | |||
Treasury Stock | (136,388) | (136,388) | |||
Retained earnings | 1,732,725 | 1,638,733 | |||
Accumulated other comprehensive income (loss) | (776) | (768) | |||
Total Shareholders' Equity | 1,682,443 | 1,587,422 | |||
Total Liabilities and Shareholders' Equity | $ 3,736,050 | $ 3,715,476 |
Copa Holdings, S. A. and subsidiaries | |||||||||||||
Consolidated Statement of Cash Flows | |||||||||||||
For the three months ended March 31, | |||||||||||||
(In US$ thousands) | |||||||||||||
2016 | 2015 | 2014 | |||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | |||||||||||
Cash flow from operating activities | 118,934 | 83,361 | 74,364 | ||||||||||
Cash flow (used in) from investing activities | (42,044) | (16,479) | 97,524 | ||||||||||
Cash flow used in financing activities | (71,652) | (67,916) | (73,677) | ||||||||||
Net increase (decrease) in cash and cash equivalents | 5,238 | (1,034) | 98,211 | ||||||||||
Cash and cash equivalents at January 1 | 204,715 | 221,443 | 139,110 | ||||||||||
Cash and cash equivalents at March 31 | $ 209,953 | $ 220,409 | $ 237,321 | ||||||||||
Short-term investments * | 457,505 | 332,000 | 878,674 | ||||||||||
Long-term investments ** | 864 | 558,290 | 6,589 | ||||||||||
Restricted cash and cash equivalents *** | 55,611 | 48,872 | - | ||||||||||
Total cash and cash equivalents and investments at March 31 | $ 723,933 | $ 1,159,571 | $ 1,122,584 | ||||||||||
* Short term - investments include $417.1 million of cash in Venezuela at March 2014. | |||||||||||||
** Long term - investments include $452.4 million at March 2015 of cash in Venezuela. | |||||||||||||
*** Restricted cash correspond to a margin calls to secure derivative financial instruments transactions. |
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 | 1Q16 | 1Q15 | 4Q15 | |||
Net income as Reported | $115,456 | $113,188 | -$408,472 | |||
Special Items (adjustments): | ||||||
Unrealized (gain) loss on fuel hedging instruments | 27,432 | 7,115 | (15,296) | |||
(Loss) gain due to devaluation of Venezuelan Bolivar | 18,134 | (36) | (430,073) | |||
(Loss) gain due to devaluation of Argentinian Pesos | 0 | 0 | (6,901) | |||
Unrealized (gain) loss on Shares Repurchased | 0 | 0 | 2,296 | |||
Adjusted Net Income | $69,890 | $106,110 | $41,501 | |||
Shares used for Computation (in thousands) | ||||||
Basic and Diluted | 42,109 | 44,077 | 43,286 | |||
Adjusted earnings per share - Basic and Diluted | 1.66 | 2.41 | 0.96 | |||
Reconciliation Operating Costs per ASM | ||||||
Excluding Fuel and Special Items | 1Q16 | 1Q15 | 4Q15 | |||
Operating Costs per ASM as Reported | 8.3 | 9.3 | 9.0 | |||
Aircraft fuel per ASM | (2.2) | (3.0) | (2.5) | |||
Operating Costs per ASM excluding fuel | 6.2 | 6.3 | 6.5 |
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SOURCE Copa Holdings, S.A.