Company Announcements

Copa Holdings Reports Financial Results for the Third Quarter of 2022

PANAMA CITY, Panama , Nov. 16, 2022 /PRNewswire/ -- Copa Holdings, S.A. (NYSE: CPA), today announced financial results for the third quarter of 2022 (3Q22). 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 third quarter of 2019 (3Q19) (which the Company believes are more relevant than year-over-year comparisons due to the significant impact of the COVID-19 pandemic in 2020 and 2021).

OPERATING AND FINANCIAL HIGHLIGHTS

  • Copa Holdings reported a net profit of US$115.9 million for the quarter or US$2.93 per share, as compared to a net profit of US$104.0 million or earnings per share of US$2.45 in 3Q19. Excluding special items, comprised of an unrealized mark-to-market net gain of US$0.9 million related to the Company's convertible notes as well as changes in the value of financial investments, the Company would have reported a net profit of US$115.1 million or US$2.91 per share.
  • Copa Holdings reported an operating profit of US$143.7 million for the quarter and a 17.8% operating margin, compared to an operating profit of US$132.9 million and an operating margin of 18.8% in 3Q19.
  • Total revenues for 3Q22 increased 14.3% to US$809.4 million, as compared to 3Q19 revenues. Yields increased 12.1% to 14.1 cents and revenue per available seat mile (RASM) increased 15.0% to 12.8 cents.
  • Operating cost per available seat mile (CASM) increased 16.4% from 9.0 cents in 3Q19 to 10.5 cents in 3Q22, driven by higher fuel prices. CASM excluding fuel (Ex-fuel CASM) decreased 5.3% in the quarter to 5.9 cents, as compared to 3Q19.
  • Passenger traffic, measured in terms of revenue passenger mile (RPMs), increased by 0.8% compared to 3Q19, while capacity (ASMs) decreased by 0.6%. As a result, load factors for the quarter increased by 1.2 percentage points to 86.8%. 
  • During the quarter, the Company started operations in one new route — Felipe Angeles International Airport in Mexico City.
  • The Company ended the quarter with approximately US$1.1 billion in cash, short-term and long-term investments, which represents 42% of the last twelve months' revenues.
  • The Company closed the quarter with total debt, including lease liabilities, of US$1.7 billion.
  • During the quarter, the Company took delivery of one Boeing 737 MAX 9 aircraft, ending the quarter with a consolidated fleet of 95 aircraft – 67 Boeing 737-800s, 18 Boeing 737 MAX 9s, 9 Boeing 737-700s, and     1 Boeing 737-800 freighter, compared to a fleet of 102 aircraft prior to the COVID-19 pandemic.
  • Copa Airlines had an on-time performance for the quarter of 86.6% and a flight completion factor of 99.5%.

Subsequent Events

  • In October, the Company took delivery of one Boeing 737 MAX 9 and expects to receive one additional aircraft in November, to end the year with a total fleet of 97 aircraft.
  • In October, Copa Airlines was recognized by Skytrax – for the seventh consecutive year – as the "Best Airline in Central America and the Caribbean" and as the "Best Airline Staff in Central America and the Caribbean."

Consolidated Financial
& Operating Highlights

3Q22

3Q19 (3)

Variance
vs. 3Q19

2Q22

Variance vs. 2Q22

Revenue Passengers Carried (000s)

2,755

2,703

1.9 %

2,481

11.1 %

Revenue Passengers OnBoard (000s)

4,190

3,946

6.2 %

3,796

10.4 %

RPMs (millions) 

5,508

5,466

0.8 %

5,047

9.1 %

ASMs (millions) 

6,344

6,383

-0.6 %

5,955

6.5 %

Load Factor 

86.8 %

85.6 %

1.2 p.p.

84.8 %

2.1 p.p.

Yield (US$ Cents) 

14.1

12.5

12.1 %

13.0

8.0 %

PRASM (US$ Cents) 

12.2

10.7

13.7 %

11.0

10.6 %

RASM (US$ Cents) 

12.8

11.1

15.0 %

11.6

9.6 %

CASM (US$ Cents) 

10.5

9.0

16.4 %

10.9

-4.0 %

CASM Excl. Fuel (US$ Cents) 

5.9

6.2

-5.3 %

6.0

-1.1 %

Fuel Gallons Consumed (millions) 

75.7

82.0

-7.7 %

71.5

5.9 %

Avg. Price Per Fuel Gallon (US$)

3.81

2.16

76.6 %

4.14

-8.0 %

Average Length of Haul (miles)

1,999

2,022

-1.1 %

2,034

-1.7 %

Average Stage Length (miles)

1,265

1,295

-2.3 %

1,273

-0.7 %

Departures

31,484

33,373

-5.7 %

29,369

7.2 %

Block Hours

102,027

109,614

-6.9 %

95,315

7.0 %

Average Aircraft Utilization (hours) (2)

11.8

11.5

3.0 %

11.5

2.9 %

Operating Revenues (US$ millions) 

809.4

708.2

14.3 %

693.4

16.7 %

Operating Profit (Loss) (US$ millions)

143.7

132.9

8.1 %

42.3

240.0 %

Operating Margin 

17.8 %

18.8 %

-1.0 p.p.

6.1 %

11.7 p.p.

Net Profit (Loss) (US$ millions)

115.9

104.0

11.5 %

124.1

-6.6 %

Adjusted Net Profit (Loss) (US$ millions) (1)

115.1

104.0

10.7 %

13.2

773.8 %

Basic EPS (US$)

2.93

2.45

19.7 %

3.01

-2.7 %

Adjusted Basic EPS (US$) (1)

2.91

2.45

18.8 %

0.32

809.6 %

Shares  for calculation of Basic EPS (000s) 

39,589

42,487

-6.8 %

41,212

-3.9 %

(1)  Excludes Special Items. This earnings release includes a reconciliation of non-IFRS financial measures to the comparable IFRS measures. 
(2)  Average Aircraft Utilization is calculated based on the Company's active fleet, excluding aircraft in storage. 
(3)  The Company believes that comparisons with 2019 are more relevant than year-over-year comparisons due to the significant impacts in 2020 and 2021 of the COVID-19 pandemic.

FULL 3Q22 EARNINGS RELEASE AVAILABLE FOR DOWNLOAD AT: 
https://copa.gcs-web.com/financial-information/quarterly-results

3Q22 EARNINGS RESULTS CONFERENCE CALL AND WEBCAST

 

Date:

November 17, 2022



Time:

11:00 AM US ET (11:00 AM Local Time)



Join by phone: 

https://register.vevent.com/register/BI09fdd12e99dd439db610429d1901849a



Webcast (listen-only):

https://copa.gcs-web.com/events-and-presentations



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 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.










Income Statement - IFRS










(US$ Thousands)












Unaudited


Unaudited


%

Unaudited


%



3Q22


3Q19


Change

2Q22


Change

Operating Revenues










Passenger revenue


774,230


685,337


13.0 %

656,943


17.9 %

Cargo and mail revenue


26,400


14,647


80.2 %

26,734


-1.2 %

Other operating revenue


8,815


8,226


7.2 %

9,718


-9.3 %

Total Operating Revenue


809,445


708,210


14.3 %

693,394


16.7 %











Operating Expenses










Fuel


291,528


177,603


64.1 %

295,952


-1.5 %

Wages, salaries, benefits and other employees' expenses


96,612


113,398


-14.8 %

88,995


8.6 %

Passenger servicing


18,881


26,204


-27.9 %

16,074


17.5 %

Airport facilities and handling charges


49,783


47,022


5.9 %

47,280


5.3 %

Sales and distribution


60,712


52,980


14.6 %

56,222


8.0 %

Maintenance, materials and repairs


23,577


30,632


-23.0 %

28,311


-16.7 %

Depreciation and amortization


68,813


72,876


-5.6 %

65,337


5.3 %

Flight operations


25,483


26,572


-4.1 %

24,068


5.9 %

Other operating and administrative expenses


30,363


28,047


8.3 %

28,894


5.1 %

Total Operating Expense


665,752


575,334


15.7 %

651,133


2.2 %











Operating Profit/(Loss)


143,692


132,876


8.1 %

42,261


240.0 %











Non-operating Income (Expense):










Finance cost


(22,528)


(12,696)


77.4 %

(21,270)


5.9 %

Finance income


4,546


6,121


-25.7 %

3,526


28.9 %

Gain (loss) on foreign currency fluctuations


(3,335)


(9,641)


-65.4 %

(6,834)


-51.2 %

Net change in fair value of derivatives


1,575


-


-100.0 %

113,670


-98.6 %

Other non-operating income (expense)


4,230


(350)


-1307.8 %

(2,717)


-255.7 %

Total Non-Operating Income/(Expense)


(15,513)


(16,567)


-6.4 %

86,375


-118.0 %











Profit before taxes


128,179


116,309


10.2 %

128,636


-0.4 %











Income tax expense


(12,241)


(12,332)


-0.7 %

(4,560)


168.4 %











Net Profit/(Loss)


115,939


103,978


11.5 %

124,076


-6.6 %











EPS










Basic


2.93


2.45


19.7 %

3.01


-2.7 %











Shares used for calculation:










Basic


39,588,984


42,487,355


-6.8 %

41,211,540


-3.9 %











 

Copa Holdings, S. A. and subsidiaries 



Consolidated statement of financial position 



(US$ Thousands)




September 2022

December 2021

 ASSETS 

 (Unaudited)  


Cash and cash equivalents

198,744

211,081

Short-term investments

752,812

806,340

Total cash, cash equivalents and short-term investments

951,557

1,017,421



-

Accounts receivable, net

155,571

90,618

Accounts receivable from related parties

2,159

1,832

Expendable parts and supplies, net

91,986

74,778

Prepaid expenses

45,418

31,148

Prepaid income tax

19,573

16,938

Other current assets

9,533

6,054


324,240

221,368

TOTAL CURRENT ASSETS

1,275,797

1,238,789




Long-term investments

168,114

199,670

Long-term prepaid expenses

11,987

6,727

Property and equipment, net

2,855,422

2,512,704

Right of use assets

186,887

166,328

Intangible, net

77,061

81,749

Deferred tax assets

30,941

28,196

Other Non-Current Assets

16,319

14,098

TOTAL NON-CURRENT ASSETS

3,346,731

3,009,472




TOTAL ASSETS

4,622,529

4,248,261




LIABILITIES



Loans and borrowings

199,437

196,602

Current portion of lease liability

77,418

73,917

Accounts payable

148,469

112,596

Accounts payable to related parties

10,667

7,948

Air traffic liability

736,581

557,331

Frequent flyer deferred revenue

105,914

95,114

Taxes Payable

46,124

32,600

Employee benefits obligations

34,883

32,767

Income tax payable

14,569

3,835

Other Current Liabilities

819

786

TOTAL CURRENT LIABILITIES

1,374,881

1,113,496




Loans and borrowings long-term

1,323,182

1,229,031

Lease Liability

117,213

104,734

Net Defined Benefit Liability

7,043

7,670

Derivative financial instruments

159,845

268,338

Deferred tax Liabilities

23,853

18,782

Other long - term liabilities

220,941

206,813

TOTAL NON-CURRENT LIABILITIES

1,852,077

1,835,368




TOTAL LIABILITIES

3,226,958

2,948,864




EQUITY


-

Class A - 34,033,575  issued and 28,477,704 outstanding

21,327

21,289

Class B - 10,938,125

7,466

7,466

Additional Paid-In Capital

102,208

98,348

Treasury Stock

(344,541)

(176,902)

Retained Earnings

1,367,868

1,324,022

Net profit

259,773

43,844

Other comprehensive loss

(18,531)

(18,670)




TOTAL EQUITY

1,395,570

1,299,397

TOTAL EQUITY LIABILITIES

4,622,529

4,248,261




 

Copa Holdings, S. A. and subsidiaries 







Consolidated Statement of Cash Flows







For the nine months ended September 30







(In US$ thousands)
















2022


2021


2020










(Unaudited)


(Unaudited)


(Unaudited)

Cash flow from (used in) operating activities 


543,471


263,252


(75,298)

Cash flow used in investing activities 


(387,334)


(140,844)


(2,333)

Cash flow (used in) from financing activities 


(168,474)


48,758


141,162

Net (decrease) increase in cash and cash equivalents 


(12,337)


171,166


63,531

Cash and cash equivalents at January 1


211,081


119,065


158,732

Cash and cash equivalents at September 30


$               198,744


$               290,231


$               222,263















Short-term investments 


752,812


901,645


644,137

Long-term investments 


168,114


96,956


139,503

Total cash and cash equivalents and investments at September 30


$            1,119,670


$            1,288,832


$            1,005,903

 

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









and Adjusted Net Profit


3Q22


3Q21


2Q22


3Q19










Operating Profit as Reported


$   143,692


$     59,010


$     42,261


$   132,876

   Subtract: Unredeemed Ticket Revenue provision reversal




$     10,395





Adjusted Operating Profit


$   143,692


$     48,615


$     42,261


$   132,876










Net Profit as Reported


$   115,939


$       8,242


$   124,076


$   103,978

   Subtract: Unredeemed Ticket Revenue provision reversal




$     10,395





   Add: Net change in fair value of derivatives


$     (1,575)


$     32,092


$ (113,670)



   Add: Net change in fair value of financial investments


$          699




$       2,761



Adjusted Net Profit


$   115,062


$     29,939


$     13,168


$   103,978










Reconciliation of Adjusted Basic EPS


3Q22


3Q21


2Q22


3Q19










Adjusted Net Profit


$   115,062


$   (16,220)


$     13,168


$   103,978

Shares used for calculation of Basic EPS


39,589


42,651


41,212


42,487

Adjusted Basic Earnings per share (Adjusted Basic EPS)


$         2.91


$         0.70


$         0.32


$         2.45










Reconciliation of Operating Costs per ASM









Excluding Fuel (CASM Excl. Fuel)


3Q22


3Q21


2Q22


3Q19










Operating Costs per ASM as Reported (in US$ Cents)


10.5


8.8


10.9


9.0

Aircraft Fuel Cost per ASM  (in US$ Cents)


4.6


2.6


5.0


2.8

Operating Costs per ASM excluding fuel (in US$ Cents)


5.9


6.2


6.0


6.2










 

Cision View original content:https://www.prnewswire.com/news-releases/copa-holdings-reports-financial-results-for-the-third-quarter-of-2022-301680605.html

SOURCE Copa Holdings, S.A.